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2023 Supreme(Online)(Bom) 23757
IN THE HIGH COURT OF BOMBAY AT GOA
SECOND APPEAL NO.33/2022
MR K. NAGESH SHET, son of
late Manunath Shet, married,
aged 78, resident of G/1, Classic
Apts., Behind Cafe Porvorim,
Krantinagar Alto Betim,
Porvorim, Bardez, Goa. … APPELLANT
Versus
1. DR. ANTONIO TEOTONIO
CARDOSO, son of late Rodrigo
Francisco das Merces Peres
Cardozo, aged 69, and his wife,
2. MRS JAYANTI GRACIAS E
CARDOSO, aged 69, retired,
both residents of H.No.520 of
Caitanwado, Merces, Tiswadi,
Goa. … RESPONDENTS
Mr Ajit Kantak, Advocate for the Appellant.
Mr Amey Kakodkar, Advocate for the Respondents.
CORAM: M. S. SONAK, J.
DATED: 23rd February 2023
For the Appellants/Petitioners: Mr Ajit Kantak
For the Respondents: Mr Amey Kakodkar
Agreements contravening statutory provisions are unenforceable, and lack of timely performance invalidates claims for specific performance.
Headnote:(A) Goa Land Use (Regulation) Act, 1991 - Section 2 - Indian Contract Act, 1872 - Sections 23 and 46 - Second appeal for specific performance of an agreement declared opposed to public policy and unenforceable as per the applicable laws - Respondents contended that a tripartite agreement violated the provisions of the Land Use Act. (Paras 3, 9, 12)
(B) Appeal Court held that the agreement was unenforceable since timely permissions were not obtained for construction as per the contractual terms leading to repudiation after considerable delay. (Paras 12, 13)
Facts of the case:
The appellant sought specific performance of a tripartite agreement for property that was ostensibly intended for agricultural use but was set to be developed for non-agricultural purposes. Time specifications for obtaining permissions were contested in the appeal on grounds of public policy.
Findings of Court:
The appeal court affirmed the application of public policy principles, stating no performance could be executed for agreements designed to contravene statutory provisions.
Issues: The main issues included the enforceability of the contract in light of public policy and whether the time for performance was adequately defined.
Ratio Decidendi: The court emphasized that agreements contravening legal statutes are unenforceable and highlighted that non-discharge of obligations within a reasonable timeframe renders a specific performance claim invalid.
Result: Appeal dismissed.
ORAL JUDGMENT:
1. Heard Mr Kantak for the appellant and Mr Kakodkar for the respondents.
2. This Second Appeal challenges the Judgment and Decree dated 22.02.2021 made by the Appeal Court in Regular Civil Appeal No.91/2019 dismissing the appellant's (plaintiff's) suit for specific performance.
3. Mr Kantak, the learned counsel for the appellant urges the formulation of the following substantial questions of law, which according to him, arise in this appeal:-
(A) Whether the reasoning of the learned District Judge of the applicability of Section 2 of the Goa land Use Act and consequently Section 23 of the Indian Contract Act could be said to be applicable when the competent authority viz. the Mamlatdar under the GDD Agricultural Tenancy Act had held Shamba Kavlekar not to be a tenant and when the respondent too contended that Shamba Kavlekar was not tenant.
(B) Whether the learned District Judge could have interpreted the wordings “one year from the date the plaintiffs obtain all the relevant permissions from the competent authorities for carrying out construction in the suit property” to hold the applicability of Section 46 of the Indian Contract Act that no time for specific performance is specified.
4. Mr Kantak submits that in this case Shamba Kavlekar was never declared as a tenant under the provisions of the Goa Agricultural Tenancy Act. He therefore submits that there was no vesting of property in the said alleged tenant. In the absence of vesting, the provisions of the Goa Land Use (Regulation) Act, 1991 were not attracted. Therefore, the appeal court erred in holding that the agreement, of which specific performance was applied for, was opposed to public policy or otherwise hit by the provisions of Section 23 of the Contract Act.
5. Mr Kantak submitted that in terms of Clause 2(b) of the agreement dated 25.10.1996, the balance consideration of Rs.6.5 lakhs had to be paid to the respondents within a period of one year of obtaining all the relevant permissions from the competent authorities for carrying out construction on the said property. He submits that the construction permissions were admittedly not obtained. Notice was served by the respondents concerning this agreement on 18.04.2012. Within three months, the appellant offered to pay the entire balance consideration even though no permissions had been obtained. Mr Kantak submits that in such circumstances neither did the bar of limitation apply nor can it be said that there was any lack of readiness and willingness on the appellant's part to comply with his part of the bargain. Mr Kantak submits that considering this factual situation, provisions of Section 46 of the Contract Act were not attracted.
6. In the above regard, the following averments in paragraph 7 of the plaint are quite telling:
“7. That in terms already agreed upon in the discussions and settled upon by the Plaintiff with Smt. Mira Shamba Kavlekar and Smt. Ashwini Ashakant Kavlekar, a tripartite Agreement dated 25.10.1996 and was entered into between the Defendants as the owners of the property, the plaintiff and Smt. Mira Shamba Kavlekar and Smt. Ashwini Ashakant Kavlekar, the heirs of Late Shamba Janu Kavlekar, this agreement executed before the Notary Shri Ashok S. Mashelkar under No.2977 on 25.10.1996. In terms of this Agreement, it was agreed that the heirs of Late Shamba Janu Kavlekar would declare that the name of Late Shamba Janu Kavlekar was erroneously recorded in the Survey Records and the Plaintiff in return was to give them an amount of Rs.1,00,000/- at the time of execution of the Agreement and thereafter a double bedroom Flat admeasuring a Super Built up area of 80 square metres to be located on the First floor of the Building to be constructed on the SUIT PROPERTY.”
7. Mr Kakodkar, learned counsel for the respondents submits that the appeal court was justified in invoking the provisions of Section 2 of the Goa land Use (Regulation) Act 1991. He submits that the appeal court was just
