Arjuna Mudaliar v. Lakshmi Ammal And Others.

1. The plaintiff is the appellant. He and his deceased brother, one Ramaswami Mudali, and the latter as the guardian of his minor son the third defendant, sold the suit properties to the second defendant on 9th January, 1920, by registered sale deed Ex. D. 1, for a sum of Rs. 300. On the same day, the second defendant and his wife, the first defendant, executed in favour of the vendors an agreement, Ex. P-1, agreeing to reconvey the properties on the vendors paying on any day the principal of Rs. 300, the sale price, and interest accrued on it at the rate of Re. 1 per Rs. 100 per mensem. Ramaswami Mudali died, and defendants 3 and 4 are his sons and the fifth defendant is his widow. The plaintiff instituted the suit out of which this appeal arises in the Court of the District Munsiff of Ami on 4th September, 1942, claiming one of two alternative reliefs. His first claim was on the basis that the sale deed and the agreement to reconvey formed part of the same transaction, and together amounted in law to a mortgage by conditional sale. On this footing, he claimed redemption. In the alternative, he claimed specific performance of the agreement to reconvey. The contesting defendants 1 and 2 denied that the transaction amounted to a mortgage and pleaded that the suit was barred by limitation because the agreement was sought to be enforced after the expiry of a reasonable time. The plaintiff alleged that in calculating the amount payable to the defendants he would be entitled to the benefits of Madras Act IV of 1938, but the defendants denied that he was so entitled.

2. The learned District Munsiff of Arni who tried the suit dismissed it. He held that as the agreement to reconvey was unregistered it cannot in any way affect in law the registered conveyance and the two together could not amount to a mortgage by conditional sale. He further held that the relief of specific performance could not be granted as there was no averment by the plaintiff of his willingness to perform his part of the contract and also because of his laches, as the transaction was so far back as 1920. The plaintiff appealed to the Subordinate Judge of Vellore who concurred with the District Munsiff in dismissing the suit but on a ground different from the grounds on which the District Munsiff based his decision. The learned Subordinate Judge held that the plaintiff would not be disentitled to the relief of specific performance because of delay but because one of the parties to the agreement to reconvey, namely, the present third defendant, was not joined as a plaintiff; and as he did not also pray for specific performance, the plaintiff alone would not be entitled to a decree. The plaintiff again appealed to this Court in S.A. No. 284 of 194.6. Chandrasekhara Aiyar, J., agreed with the lower Courts in dismissing the plaintiff's suit, but not exactly on the ground on which the learned Subordinate Judge negatived the plaintiff's claim. The learned Judge held that the plaintiff was not entitled to specific performance because he had not expressed his readiness and willingness to perform his part of the contract when such an averment was the foundation for an action for specific performance and also because there had been a long and unreasonable delay in enforcing the claim, and it would be inequitable to grant a decree for specific performance after the lapse of 22 years.

3. The plaintiff is again the appellant in the Letters Patent Appeal.

4. Undoubtedly, in a suit for specific per romance the plaintiff has to allege that he is ready and willing to perform his part of the contract. But we do not agree with the learned Judge that it is difficult to spell out such an averment from the plaint. It is true that he raised various pleas as regards the amount rightly payable to the contesting defendants 1 and 2, but finally in paragraph 16 he stated this:

Though the plaintiff is entitled to claim larger relief's from the defendants, the plaintiff has no objection to pay the defendants any sum that the Court should be pleased to fix.

In view of this averment, the decisions in Rustomali v. Ahider Rahaman Mia (1940) 45 C.W.N. 837 and Bindeshri Prasad v. Mahant Jairam Gir (1887) L.R.

14 I.A. 173 : I.L.R. 9 All 705 (P.C.) relied on by the learned advocate for the contesting respondents (defendants 1 and 2) have no application. The plaintiff is not asserting a right to perform the contract not as it actually was but as it is alleged to be by him. Though he puts forward his own case, he makes it clear that he is ready and willing to perform the terms of the contract in accordance with the decision of the Court. No authority has been cited to us that an averment that the plaintiff had no objection to perform the contract in accordance with the decision of the Court is not a sufficient averment of his readiness and willingness to perform his part of the contract. Such an averment the plaintiff has made in this case. On this point we agree with the learned Subordinate Judge.

5. The learned Judge held that the delay of 22 years in enforcing the agreement was fatal to the plaintiff's suit. It is now well established that mere delay does not by itself preclude the plaintiff from obtaining specific performance if his suit is otherwise in time. The delay must be such that it may be properly inferred that the plaintiff has abandoned his right or on account of the delay there must have been such a change of circumstances that the grant of specific performance would prejudice the defendant. Their Lordships of the Judicial Committee pointed out in the leading case of Lindsay Petroleum Co. v. Hurd (1873) L.R. 5 P.C 221, 239 when lapse of time and delay are most material.

Where it would be practically unjust to give a remedy either because the party has, by his conduct, done that which might fairly be regarded as equivalent to a waiver of it, or where by his conduct and neglect, he has, though perhaps not waiving that remedy, yet put the other party in a situation in which it would not be reasonable to place him if the remedy were afterwards to be asserted; in either of these cases lapse of time and delay are most material.

Vide also Athikarath Nanu Menon v. Erathanikat Komu Nayar (1897) I.L.R. 21 Mad. 42. With great respect to the learned Judge, we must say that we have not been referred to any authority in which it had been held that from long delay alone without anything further, an abandonment of rights could be presumed.

6. Now in this case, there is no evidence whatever from which it could be inferred that the plaintiff had abandoned his right. The learned Judge himself observes that it is probable that the parties thought that the transaction amounted to a mortgage and there was a period of 60 years to redeem the mortgage and recover possession. If this was likely to be the consciousness of the parties, then certainly the delay of 22 years cannot lead to an inference of an abandonment of his rights by the plaintiff. Likewise, there is no evidence that on account of the lapse of time defendants 1 and 2 would be prejudiced if the plaintiff is now granted specific performance. No rights of third parties have intervened, and it is not suggested that there are any special circumstances which make it unequitable that the plaintiff should be granted the relief to which he would be entitled on foot of the agreement to reconvey. On this point we agree with the learned Subordinate Judge that the delay is no bar to the maintainability of the suit.

7. It was contended by the learned advocate for the contesting respondents that the agreement to reconvey is void because it offends against the rule of perpetuities. But this contention cannot be accepted in view of the decision of this Court in Charamudi v. Raghavulu (1915) 28 M.L.J. 471 : I.L.R. 39 Mad. 462.

8. The plaintiff will, therefore, be entitled to specific performance of the agreement to reconvey. The Madras Agriculturists Relief Act cannot possibly apply to the case, and the plaintiff, before he gets a conveyance must, in accordance with the terms of the agreement, deposit into Court the sum of Rs. 300 with interest thereon at the rate of 12 per cent. per annum from the date of the agreement upto the date of the plaint and thereafter at 6 per cent. per annum upto the date of the deposit. The time for deposit will be three months from this date. Having regard to the long lapse of time, the plaintiff will not be entitled to any extension of time which we have now granted to deposit the money. There will be a decree for specific performance. The appellant will be entitled to his costs from the contesting respondents 1 and 2 in the Letters Patent Appeal. But there will be no order as to costs in the second appeal and in the Courts below.