Allowed

Madan Lal and Anr. v. Ravi Setia and Ors.

Punjab & Haryana HC13 Jan 2009RSA/2443/1999

Case brief

AI extract

What is this about?

In an appeal regarding a suit for specific performance of an agreement to sell land, the High Court set aside the lower courts' decree. Finding the plaintiff failed to demonstrate readiness and willingness due to ignoring notices and non-payment of consideration, the Court reversed the finding of entitlement under Section 16(c) of the Specific Relief Act, dismissing the suit.

What did the court decide?

The appeal was accepted; the judgment and decree below were set aside; the original suit for specific performance was dismissed with no order as to costs.

Madan Lal and Anr. Vs Ravi Setia… — Contract and Commercial Disputes | Punjab & Haryana HC (2009)

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RSA No.2443 of 1999

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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH

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RSA No.2443 of 1999 Date of Decision: 13.1.2009

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Madan Lal & Anr. ...Appellants

Vs.

Ravi Setia & Ors.

...Respondents

CORAM Hon'ble Mr.Justice Vinod K.Sharma

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Present: Mr.L.N.Verma, Advocate, for the appellants.

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Mr.J.R.Mittal, Sr. Advocate, with Mr.Kashmir Singh & Mr.Lalit Sharma, Advocates, for respondent No.1.

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Mr.S.C.Chhabra, Advocate, for respondents No.5 and 6.

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Vinod K.Sharma, J .

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This order shall dispose of RSA Nos. 2443 and 1649 of 1999 titled Madan Lal & Anr. Vs. Ravi Setia & Ors. and Vinay Kumar & Anr. Vs. Ravi Setia & Ors. as these arise out of the same transaction and raises a common question of law and facts.

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For the sake of brevity the facts are being taken from RSA No.2443 of 1999.

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RSA No.2443 of 1999

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The plaintiff/respondents filed a suit for possession by way of specific performance of the agreement to sell dated 10.11.1989 with respect to the suit land measuring 41 kanals 4//2/3 marlas i.e. 2/3^rd share of the total land measuring 61 kanal 17 marlas and in the alternative suit for recovery of Rs.1 lac.

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The plaintiff/respondents also sought a consequential relief of permanent injunction restraining defendants No.4 to 7 from alienating the suit land to any other person. It was claimed by the plaintiffs that Shankar Lal, Het Ram and Hazari Ram were owners in possession of land measuring 61 kanals 17 marlas in village Gumjal, Tehsil Abohar, District Ferozepur. On 10.11.1989 defendants No.1 and 2 agreed to sell the entire land measuring 61 kanals 7 marlas to the plaintiff/respondent No.1 at the rate of Rs.17,000/- per acre. The defendants were said to have 1/3^rd share each in the above said land. It was claimed that the agreement was also executed by Shankar Lal and Het Ram on behalf of Hazari Ram on the assertions that the same would be signed by Hazari Ram lateron. It was also claimed that a sum of Rs.50,000/- was paid as earnest money and the sale deed was agreed to be executed on or before 30.4.1990.

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The suit was also filed against minors who were sued through their father Het Ram. It was also claimed that Hazari Ram did not come forward to sign the agreement to sell. The plaintiff/respondents claimed that they have always been ready and willing to perform their part of contract but defendants No.1 and 2 did not execute the sale deed in favour of the plaintiff. It was claimed by the plaintiff/respondent that on 30.4.1990 the plaintiff went to the office of Registrar, Abohar with the balance sale

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RSA No.2443 of 1999

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consideration and other necessary expenses of sale deed and remained there from 9 AM to 5 PM but defendants No.1 and 2 did not reach there and thus, the sale deed could not be executed. It was also claimed that defendants No.4 to 7 i.e. Subsequent buyers had the knowledge of agreement being executed but in spite of knowledge they purchased the suit land from defendants No.1 to 3 through different sale deeds dated 16.1.1991. It was also claimed that in case decree of specific performance is not granted the suit filed by the plaintiff be decreed for the recovery of a sum of Rs.1 lac.

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The suit was contested by defendants No.1 to 3 admitting the agreement to sell dated 10.11.1989. However, it was claimed that defendant No.3 had not authorized defendants No.1 and 2 to execute the agreement to sell his share of the land on his behalf. It was claimed that agreement to sell was cancelled by the plaintiff/respondent in the presence of Baldev Singh Sarpanch and Harphool, attorney of Lamberdar Ram Partap of village Gumjal. The appellants issued notices to the plaintiff/respondent on 28.5.1990 and 12.6.1990 to get the sale deed executed till 12.6.1990 but he failed to get the same executed. It was also the stand of the defendants that they had always been ready and willing to perform their part of the contract but there was lapse on the part of the plaintiff. The pleas that the suit was not properly valued for the purpose of court fee and jurisdiction and that agreement to sell was not enforceable were also taken.

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Defendants No.4 and 5 filed separate written statement alleging that they purchased some part of the suit land vide sale deed dated 16.1.1991 for valuable consideration without notice of the previous agreement to sell.

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RSA No.2443 of 1999

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Defendants No.6 and 7 who are minors filed written statement through court guardian by claiming that they had purchased part of the suit land through two sale deeds dated 16.1.1991 for valuable consideration without knowledge.

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On the pleadings of the parties the following issues were

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framed:-

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Whether the plaintiff is and has always been ready and willing to perform his part of the agreement? OPP

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Whether the agreement dated 10.11.1989 was cancelled as alleged by the defendants? OPD

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Whether the defendants Nos.4 to 7 are bona fide purchasers without notices for consideration ? OPD 4 to 7

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Whether the agreement in question is unenforceable? OPD

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Whether the suit is properly valued for the purposes of court fee and jurisdiction? OPP

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Whether the plaintiff is entitled for specific performance of the contract? OPP

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Relief.

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Learned trial court by believing the statement made by the

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plaintiff/respondent that he was ready with the sale consideration along with other expenses and had appeared before the Sub Registrar on 30.4.1990 and thus decided issue No.1 in favour of the plaintiff/respondent and against the appellant/defendants. Issue No.2 was also decided in favour of the plaintiff/respondent by observing that the oral evidence led by the

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RSA No.2443 of 1999

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defendant/appellants showing the cancellation of agreement to sell could not be believed in the absence of endorsement on the back of agreement. Learned trial court also ignored the documentary evidence Ex.D.1 and Ex.D.2 i.e. the notices issued calling upon the plaintiff/respondent to execute the sale deed to be not relevant for deciding as to whether the agreement stood cancelled or not. Learned trial court also held the sale deed in favour of subsequent purchasers to be merely a sham transaction. Learned trial court observed that as the defendants were residing at the neighbourhood of defendants No.1 and 2 they could not be held to be bona fide purchasers as they were deemed to have knowledge of the agreement to sell in favour of the plaintiff. In view of the findings on issues No.1 to 3 other issues were also decided in favour of plaintiff and against the defendants. Consequently, suit was ordered to be decreed.

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Before the learned lower appellate court a plea was raised that the interest of minor defendant No.6 was not properly protected as the court guardian did not take steps to protect their right. It was also the contention that the application moved by the natural guardian i.e. the father of defendants No.6 and 7 was wrongly brushed aside and suit decreed.

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Learned lower appellate court observed that the interest of the other defendants was similar to that of minors and therefore, it could not be held that the interest of minors was not watched, thus, rejected the plea of the appellants. The plea that the agreement was invalid was also rejected. Learned lower appellate court affirmed the findings recorded by the learned trial court and dismissed the appeal.

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Learned counsel for the appellants raised the following

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RSA No.2443 of 1999

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substantial questions of law for determination by this court:-

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Whether the learned courts below have acted with perversity in returning the findings of readiness and willingness in favour of the respondent by over looking the evidence as noticed by the learned trial court in the judgment i.e. prior notices given by Shankar Lal etc. Ex.D1 dated 28.5.1990, Ex.D.2 dated 12.6.90, postal receipts thereof, Exh.D.3 to D.8 and application made for marking their presence dated 13.6.1990 (Ex.D.9) to which there was no rebuttal by respondent Shri Ravi Setia who failed to get executed the sale deed executed despite said repeated requests by the vendors?

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Whether the judgment rendered by the learned Courts below suffer from perversity in recording a finding on no evidence and in drawing wrong inferences from proved facts contrary to the judgment of the Hon'ble Supreme Court in case Hero Vinoth (minor) Vs. Seeshammal, 2006 (2) RCR (Civil) 677”

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Mr.S.C.Chhabra, learned counsel appearing on behalf of the appellants contended that the findings recorded by the learned courts below on facts are contrary to evidence on record and suffer from perversity. The contention of the learned counsel for the appellants was that in the present case the agreement to sell was admitted. However, learned courts below committed an error in deciding issue No.1 in favour of the plaintiff/respondent. The contention of the learned counsel for the

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RSA No.2443 of 1999

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appellants was that in order to succeed in a suit for specific performance the plaintiff was required to prove that he was always willing and ready and was still willing to perform his part of the contract.

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There is force in the contention raised by the learned counsel for the appellants.

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It may be noticed that in the present case except for the bald statement along with certificate of presence nothing was brought on record to show the willingness of the plaintiff/respondent to execute the sale deed The appellant/defendants placed on record notice Ex.D.1 dated 28.5.90 as well as notice Ex.D.2 dated 12.6.1990 along with their postal receipts calling upon the plaintiff/respondent to execute the sale deed on 13.6.1990. The evidence led went unrebutted. The evidence led by the defendant/appellants coupled with the fact that subsequent sale in favour of subsequent purchasers was at lower rate than the one agreed to be sold to the plaintiff would lead to no other conclusion but to one that the plaintiff/respondent was not always willing to perform his part of the contract and the stand of the appellant/defendants that they had no money for execution of the sale deed stood proved as no evidence was brought on record showing that the plaintiff/respondent has means to execute the sale deed on the date fixed in the agreement.

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It may also be pertinent to notice here that the learned trial court decreed the suit for specific performance of agreement by directing the plaintiff/respondent to pay the balance sale price of Rs.3,10,490/within 2 months from the passing of the decree. Direction was given that the amount be paid to defendants No.1 and 2 within 2 months. It was also

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RSA No.2443 of 1999

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mentioned that in case after receipt of consideration amount the sale deed is not executed or sale consideration not accepted then it would be open to the plaintiff/respondent to get the sale deed executed through the court after depositing the balance sale consideration in court within 2 months, in the name of concerned defendants. Decree was passed on 1.6.1994. However the amount was not deposited within the period stipulated.

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However, an application was moved under section 149 of the Code after expiry of the stipulated period for extension of time. The court vide order dated 2.8.1994 extended the time till the disposal of appeal by the learned appellate court. It is pertinent to mention here that there was no stay granted by the lower appellate court against the execution of the decree.

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However, the plea taken by the appellants for extension of time was that the stay was granted by the lower appellate court which was factually incorrect.

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Thus, it would be seen that it was proved on record that the plaintiff/respondents were not always willing to perform his part of the contract. The finding on issue No.1 by the learned courts below therefore, is contrary to the evidence brought on record and suffer from perversity and therefore, is liable to be reversed.

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It may also be noticed that in any case the defendants had agreed to sell the land in order to shift out of Punjab, however, it is the plaintiff who delayed the execution and failed to give reply to the notices issued by the appellant/defendants and thus, it could not be said that the plaintiff/respondent was ready and willing to perform his part of the contract. This view finds support from the judgment of Hon'ble Supreme

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RSA No.2443 of 1999

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Court in the case of His Holiness Achrya Swami Gansh Dassji Vs. Sita Ram Thapar AIR 1996 SC 2095.

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Mr. J.R.Mittal, learned senior counsel appearing on behalf of respondent/plaintiff contends that the concurrent findings of fact that the plaintiff was willing to perform his part of the contract cannot be interfered with by this court in regular second appeal. Learned senior counsel also contended that the appellant/defendants can take no benefit for non-deposit of decretal amount as the time was extended by the court and the amount stands deposited by the plaintiff/respondent and thus, contended that the appeal deserved to be dismissed as it raises no substantial question of law. However, on consideration of matter, I find that substantial questions of law as framed deserve to be decided in favour of the appellants.

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In the present case it was proved on record that the appellant/defendants prior to the subsequent sale had issued two notices calling upon the plaintiff/respondent to get the sale deed executed in terms of the agreement to sell.

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However, the plaintiff chose not to file any reply to the notices issued. Rather he waited for sale deed to be executed in favour of subsequent vendees before filing the suit for specific performance. Though, it is not necessary for the plaintiff to show that he was carrying actual amount for execution of the sale deed. However, in view of the facts of the present case when the notices were proved on record vide which the plaintiff/respondent was called upon to execute the sale deed it was necessary for him to bring on record the evidence to show that he had sufficient means to execute the sale deed on the date fixed, especially, when

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RSA No.2443 of 1999

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even after the passing of the decree no steps were taken by the plaintiff to deposit the amount with defendants No.1 and 2.

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Thus, the findings of the learned courts below that the plaintiff was always willing to perform his part of the contract are perverse and are contrary to the evidence brought on record and therefore, cannot be sustained in the eye of law.

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Though the High Court in regular second appeal cannot interfere with the concurrent findings of fact recorded by the courts below, however, if the findings of facts are contrary to the evidence on record and suffer from perversity the court can always interfere and set aside such findings in appeal under section 100 of the Code of Civil Procedure as held by Hon'ble Supreme Court in the case of Bondar Singh Vs.Nihal Singh 2003 (2) RCR (Civil) 222.

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The plaintiff/respondent was, thus, not entitled to decree for specific performance in view of Section 16 (c) of the Specific Relief Act, 1963.

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Consequently, both the appeal are accepted. Judgment and decree passed by the learned lower court are set aside. The suit filed by the plaintiff/respondent is ordered to be dismissed with no order as to costs.

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(Vinod K.Sharma) Judge

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13 .1.2009 rp

Madan Lal and Anr. v. Ravi Setia and Ors.

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Madan Lal and Anr. v. Ravi Setia and Ors.

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