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Smart Summary

Structured Summary of the Provided Legal Opinion

Factual and Procedural Background

The plaintiff sued for specific performance of a written agreement of sale dated 5.10.1979 concerning a wet land of 27 cents belonging to the defendant. The contract price was Rs. 24,300, of which Rs. 8,000 was paid as advance on the date of the agreement; the agreement provided that the sale should be completed within about three months and the time was later extended to 15.6.1980. The plaintiff alleged she was ready and willing to perform but the defendant evaded execution of the sale deed; the defendant admitted executing the agreement and receipt of Rs. 8,000 but contended that the plaintiff breached the contract, was unable to raise the balance, and had voluntarily abandoned or waived the transaction. The trial Court (Sub Court, Madurai / Subordinate Judge) decreed specific performance with costs. The defendant appealed to the District Court, Madurai (A.S. No. 90 of 1982), which confirmed the trial Court's decree and dismissed the appeal with costs. The defendant then filed a second appeal before this Court. This Court framed the substantial question of law: "Whether in the circumstances of the case, the plaintiff has established that she has been ready and willing to perform her part of the contract."

Legal Issues Presented

  1. Whether, on the facts and the recitals of the sale agreement and its extension, time was made the essence of the contract.
  2. Whether the plaintiff had established that she was ready and willing to perform her part of the contract (the substantial question of law framed by this Court).

Arguments of the Parties

Appellant's Arguments (Defendant)

  • Although ordinarily time is not the essence in contracts for immovable property, in the facts and circumstances of this case and as per the agreed terms, time was the essence of the contract.
  • The plaintiff was not ready or willing to perform her part of the contract.
  • Accordingly, the appellant sought interference with the concurrent findings of the Courts below.

Respondent's Arguments (Plaintiff)

  • As a settled principle, time is not ordinarily the essence of contracts relating to immovable property.
  • The plaintiff was always ready and willing to perform her part of the contract.
  • Both Courts below have concurrently found for the plaintiff based on evidence; therefore the second appeal should not interfere with those concurrent findings.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
S.S. Chokkalingam v. R.B.S. Mani & 5 others, 1994 (1) L.W 321 Illustrates that although ordinarily time is not the essence in sale of immovable property, parties may make time the essence by their agreement and circumstances. The Court held this decision applicable and accepted the argument that the parties intended time to be the essence of the contract in the present case.
Dr. Bal Saroop Daulat Ram v. Lt.Col Lakhbir Singh Kirpal Singh and another, AIR 1964 Punjab 375 Affirms that the presumption that time is not ordinarily the essence in immovable property contracts is not absolute and may be rebutted by circumstances of the contract. Referred to support the proposition that the normal presumption can be negatived by contractual circumstances; used in the chain of authorities supporting Chokkalingam.
Chand Rani v. Kamal Rani, AIR 1993 S.C. 1742 States that parties can intend to make time the essence of a contract; on facts, time may be held to be of the essence. Cited to reinforce that the parties may make time the essence and applied in concluding time was essence in this case.
Kandaswami Mudaliar v. Munuswamy Udayar, 1974 (II) M.L.J 162 Authority relied on by respondent to show presumption that time is not the essence in immovable property transactions. Considered by the Court but found less applicable in light of the facts and the Court's acceptance of Chokkalingam; did not alter the conclusion that time was essence here.
M/s. P.R Deb and Associates v. Sunanda Roy, 1996 (II) M.L.J S.C 3 Relied on by respondent as supporting the general rule that time is not ordinarily of the essence in property contracts. Not determinative for this case; the Court distinguished and preferred the reasoning in Chokkalingam given the contractual terms and extension setting an outer limit.
Sonnappa Iyer v. K.R. Ramuthaiammal and others, 1994 (1) M.L.J 44 Holds that a plaintiff seeking equitable relief of specific performance must produce the best evidence available, and failure to do so invites adverse inference. The Court applied this principle to criticise the plaintiff's failure to produce documentary proof of the two letters and to examine her husband (who allegedly would provide funds), treating non-production as fatal to the plaintiff's claim of readiness and willingness.
A.P. Sagar and others v. Govindaswami Gramani, 1996 (I) M.L.J 146 Invoked for the limited proposition that concurrent findings of fact by lower Courts should not be lightly interfered with on second appeal (Section 100 CPC). Referred to by respondent; Court noted the principle but held it could interfere where findings are unsupported by evidence or perverse, and therefore proceeded to reappraise legal aspects in this case.
O.T.M.O.M. Meyyappa Chettiar v. O.T.M.S.M. Kasi Viswanathan Chettiar and another, 1994 (1) M.L.J S.C 28 Also cited in support of the limits on interfering with concurrent findings on second appeal (Section 100 CPC). Noted by the Court; the Court nevertheless found grounds to interfere because the lower Courts' findings were inconsistent with contractual documents and evidence regarding readiness/willingness.

Court's Reasoning and Analysis

The Court's analysis proceeded in two main stages: (A) whether time was the essence of the contract and (B) whether the plaintiff was ready and willing to perform.

(A) Whether time was the essence of the contract

  1. The Court closely examined the sale agreement Ex.A1 (dated 5.10.1979) and noted the contract rate (Rs. 900 per cent), the total price (Rs. 24,300), and that Rs. 8,000 was paid on execution.
  2. The agreement expressly contemplated completion within a period of three months, and the parties later executed Ex.A2 on 16.3.1980 fixing 15.6.1980 as the last date for completion.
  3. The Court rejected the lower Courts' conclusion that parties were not particular about time; it reasoned that setting an outer limit (15.6.1980) is inconsistent with the view that time was not material.
  4. The Court accepted precedent (notably S.S. Chokkalingam v. R.B.S. Mani) establishing that the general presumption that time is not the essence is rebuttable, and concluded on the facts here that the parties intended time to be of the essence.

(B) Whether the plaintiff was ready and willing to perform

  1. The Court reiterated established authorities requiring the plaintiff to specifically plead and substantiate readiness and willingness by substantial evidence.
  2. The plaintiff as P.W.1 claimed to have sent two reminder letters before expiry; no copies of those letters were produced as exhibits and she gave the explanation that they were sent by ordinary post. The defendant denied receipt. The Court found that, in the absence of documentary evidence, it was unsafe to accept the plaintiff's claim of having sent the letters.
  3. The plaintiff admitted she did not have money and that her husband would advance funds; the husband, though available, was not examined to prove availability of funds. The Court relied on Sonnappa Iyer to hold that non-production of best evidence and failure to examine the husband was fatal to the plaintiff's claim of readiness.
  4. The plaintiff did not deposit the balance of the purchase price in Court when filing the suit; the record shows the deposit was made only on 6.1.1982 (the date of the trial Court's judgment). The Court referred to Section 16(c) of the Specific Relief Act, 1963, and concluded that the plaintiff had not shown readiness and willingness as of the date of filing the suit.
  5. The Court addressed the respondent's contention based on concurrent findings under Section 100 CPC and relevant authorities, but held that interference in a second appeal is appropriate where findings are unsupported by evidence or are perverse. Given its conclusions on the contractual documents and the absence of proof of readiness, the Court found legitimate grounds to interfere.

Holding and Implications

Holding: The Court allowed the second appeal and set aside the judgments and decrees of the Courts below. The suit for specific performance (O.S. No. 1249 of 1980) is dismissed. The Court ordered no costs in the circumstances.

Implications and Consequences:

  • Direct effect: The plaintiff's suit for specific performance is dismissed; the decree in her favour by the trial Court and the confirmation by the District Court are overturned.
  • On the factual and legal findings in this opinion: (a) the Court concluded that the parties had made time the essence of the contract by the original term and the subsequent extension fixing 15.6.1980, and (b) the plaintiff failed to prove readiness and willingness (no documentary proof of reminders, no evidence of available funds by examining the husband, and deposit of balance only at judgment stage), which precluded equitable relief.
  • Regarding precedent: The Court relied upon and applied existing case law (as summarized above) to the facts; the opinion did not purport to lay down a novel principle beyond applying established authorities to the present facts.

No information beyond the content of the provided opinion has been added. Where the opinion did not specify additional details (for example, judge names or dates of the appellate judgment other than those in the record), such details have not been inferred or supplied.

    Seeni Ammal v. Veerayee Ammal

    1. The defendant in O.S No. 1249 of 1980 on the file of the Sub Court, Madurai, is the appellant in the above appeal. She filed the said suit for specific performance of an agreement for sale.

    2. The case of the plaintiff as seen from the plaint are briefly narrated hereunder:

    The suit property is a wet land of an extent of 27 cents, belongs to the defendant. She agreed to sell the land to the plaintiff for a price of Rs. 24,300. The agreement was reduced to writing and signed by the contracting parties. It is dated 5.10.1979 and on the date of the agreement Rs. 8000 was paid as advance. It is further averred that the agreement stipulates that the sale was to be completed within a period of about three months. Again it was extended upto 15th June, 1980. Though the plaintiff was always ready and willing to perform her part of the contract, the defendant was evading. So, the plaintiff sent two letters calling upon the defendant to execute the sale deed on receipt of the balance of the price. Since it had no effect, the plaintiff has filed the present suit.

    3. The defendant filed a written statement, wherein she had admitted the execution of the sale agreement and receipt of Rs. 8,000. She however contends that it was the plaintiff, who committed the breach of contract and that she could not raise the money for payment of balance of sale price. The land in question is conveyed for construction of buildings. The value was increasing day by day. Having regard to this fact and other surrounding circumstances, time was made of the essence of the contract. This would be evident from the fact of time having been extended from 16.3.1980 for a period of three months. It is further averred that the plaintiff did not send any letters to the defendant and she was never ready and willing to perform her part of the contract. Having found that she could not complete the transaction, the plaintiff voluntarily abandoned it and also waived her rights if any arising under the agreement. So, the defendant expending large sums of money arranged to shift telegraph post standing in the land and this has enhanced the market value of the land considerably. So, it is the plaintiff, who has filed the suit for specific performance with a view to enrich herself at the expense of the defendant. With these averments, she prayed for dismissal of the suit.

    4. Plaintiff herself was examined as P.W 1 and marked Exs. A. 1 to A. 5 in support of her case. The defendant was examined as D.W 1 and she has also examined one Narayanan as D.W 2 apart from marking Ex. B. 1 in support of her defence. Through witness Exs.X1 to X. 3 were marked. The learned Subordinate Judge after framing necessary issues and in the light of the evidence available on record, decreed the suit as prayed for with costs.

    5. Against the decree of the trial Court, the aggrieved defendant filed appeal A.S No. 90 of 1982 before the District Court, Madurai. The learned First Additional District Judge, Madurai, after framing necessary points for consideration and after reassessing the evidence, confirmed the findings of the trial Court and dismissed the appeal with costs.

    6. Aggrieved by the concurrent finding of the Courts below, the defendant filed the present appeal before this Court. While entertaining this appeal, this Court has framed the following substantial question of law for consideration:

    “Whether in the circumstances of the case, the plaintiff has established that she has been ready and willing to perform her part of the contract.”

    7. Mr. T. Srinivasa Raghavan, learned counsel for the appellant, in the light of the substantial question of law framed earlier raised the following submissions: (1) Normally in matters relating to immovable property time is not the essence of the contract, however, in the facts and circumstances of the case and as per the terms agreed by both the parties, time in the essence of the contract; and (2) There was no readiness or willingness on the part of the plaintiff to perform her part of the contract. With these submissions he prays for interference in the concurrent finding of the Courts below.

    8. On the other hand, Mr. M.L Ganesan, learned counsel for the respondent raised the following submissions: (1) It is settled law that time is not the essence of the contract if it relates to immovable properties; (2) The plaintiff was always ready and willing to perform her part of the contract; and (3) In asmuch as both the Courts below have concurrently held that the plaintiff is entitled to a decree for specific performance based on evidence, absolutely there is no warrant to interfere in the second appeal. With these submissions he prayed for the dismissal of the second appeal.

    9. I have carefully considered the rival submissions.

    10. First I shall deal with the question whether time is the essence of the contract, in the light of the recitals in the sale agreement Ex.A 1? Ex.A 1 is dated 5.10.1979 Both the Courts below after noting the recitals in Ex.A 1, namely,” came to the conclusion that parties to the document were not particular about the completion of the contract within a particular time. I am unable to accept the conclusion of the Courts below. A careful scrutiny of Ex.A 1 shows that the rate was fixed at Rs. 900 per cent and the total amount payable by the plaintiff to the defendant is Rs. 24,300, out of which Rs. 8,000 has been paid on the date of the execution of the agreement. Further, the recital that within a period of three months the sale has to be completed, would clearly indicate that the parties should have completed the contract within the stipulated time. However, both the parties on 16.3.1980 once again extended the time and fixed 15.6.1980 as the last date for completion of the sale. If time is not the essence of the contract, there is no need to fix the outer limit, namely, 15.6.1980 for execution of the sale deed and completion of the contract.

    11. In the light of the above position, the learned counsel for the appellant relied upon a decision of the Division Bench of this Court reported in Chokkalingam, S.S. Chokkalingam v. R.B.S. Mani & 5 others, 1994 (1) L.W 321.

    In similar circumstances the Division Bench in the above judgment has held as follows:

    “It is contended that time is not the essence of the contract and the mere fact that the appellant has not been able to pay the entire amount within a particular time will not disentitle him to the relief of specific performance. No doubt, ordinarily in contracts relating to immovable property, time is not the essence of the contract. But, in the facts and circumstances of each case, the court can come to a conclusion in that in a particular case, time has been made the essence of the contract. In Dr. Bal Saroop Daulat Ram v. Lt.Col Lakhbir Singh Kirpal Singh and another, AIR 1964 Punjab 375, a Division Bench has held that the normal initial presumption of time not ordinarily being of the essence of contract in case of sale of immovable property, is not statutory or absolute and irrebuttable, and circumstances of a given contract may clearly negative it. In Chand Rani v. Kamal Rani, AIR 1993 S.C 1742, the Court stated that though as a general proposition of law time is not the essence of the contract in the case of sale of immovable property, yet the parties can intend to make time as the essence. On the facts of the case, the Court held that the time was of the essence of contract. In the present case, we hold that though initially the respondents were willing to extend the time as requested by the appellant, they have made it clear to him unequivocally that he should complete the transaction before a particular date. In fact, the appellant himself has assured the respondents that in case of default, they were free to seek other purchasers. Hence, in this case we hold that the appellant is not entitled to claim the relief of specific performance as he has not come to Court within the time. We have also pointed out that the suit has been filed long after the appellant was informed of the sale in favour of respondents 3 and 4. There is absolutely no explanation on record as to why the appellant was keeping quiet for such a long time.”

    In this case also under Ex.A 1 initially the parties have agreed for the completion of the sale within the period of three months and thereafter under Ex.A 2 dated 16.3.1980, both the parties agreed that the sale has to be completed before 15.6.1980 In those circumstances, it is safe to conclude that the parties were aware that the sale has to be completed before 15.6.1980 Under such circumstances, the general rule that ordinarily any contract relating to immovable property time is not the essence of the contract is not applicable in this case. No doubt, after pointing out that after the expiry of the initial period of three months till 16.3.1980 both the parties kept quiet, under those circumstances, the learned counsel for the respondent submits that it is presumed by the parties that time is not the essence of the contract. He has also relied upon two decisions, namely, (1) Kandaswami Mudaliar v. Munuswamy Udayar, 1974 (II) M.L.J 162 and (2) M/s. P.R Deb and Associates v. Sunanda Roy, 1996 (II) M.L.J S.C 3.

    After considering the above two judgments and in the light of the factual position in the present case, I am of the view that the decision relied on by the learned counsel for the appellant, namely, Chokkalingam, S.S. Chokkalingam v. R.B.S. Mani & 5 others, 1994 (1) L.W 321 is applicable to the facts of this case and I accordingly accept the arguments of the learned counsel for the appellant, namely, the intention of the parties to the sale agreement is that time is the essence of the contract.

    12. Now, I shall deal with the other question, namely, readiness and willings of the plaintiff in performing her part of the contract. Repeatedly, this Court as well as the Apex Court have held in many decisions that the plaintiff has to specifically plead his readiness and willingness and prove his case by substantial evidence. No doubt, in this case, there is a general averment that plaintiff was always ready and willing to perform his part of the contract. Plaintiff as P.W 1 deposed that before the expiry date she has reminded the defendant for completion of the sale by sending two letters. However, the copies of the alleged two letters have not been marked as exhibits in support of her case and she has also not given any explanation, however, she has conveniently deposed that both the letters were sent by ordinary post. In this regard, the defendant in the written statement as well as in her evidence categorically denied the said two letters alleged to have been sent by the plaintiff. In the absence of any documentary evidence, it is not safe to accept the case of the plaintiff that she had sent two letters prior to the expiry of the contractual period.

    13. Another important fact is that the plaintiff as P.W 1 deposed in the following manner:

    A reading of the above deposition shows that the plaintiff, who is a party to Ex.A 1 sale agreement, has admitted that she has not possessed of any money. She has also admitted that her husband will advance money for completion of the sale transaction. Even though her husband was available, he was not examined to speak about the availability of money and resources for completion of the contract. In such circumstances, the learned counsel for the appellant relied on a Division Bench Judgment of this Court reported in Sonnappa Iyer v. K.R Ramuthaiammal and others, 1994 (1) M.L.J 44.

    In the said decision it has been held that non-production of best evidence is fatal to the plaintiff's case. In the said decision, the Division Bench has held as follows:

    “When the burden is on the plaintiff to prove clearly in order to get the equitable relief of specific performance, he ought to have produced the best evidence available with him and his failure to do so would enjoin the court to draw an adverse inference against him.”

    The said proposition is squarely applicable to this case for the simple reason that the plaintiff having deposed that she was depending on her husband for completion of the sale transaction and in the absence of any money with her she ought to have examined her husband in support of her case. Non-examination of the husband of the plaintiff is a fatal to the plaintiff's case as observed by the Division Bench in the above case.

    14. Another important feature in this case is that apart from the fact that the plaintiff was not having any money for completion of the sale, she has not taken any steps atleast to deposit the remaining sale consideration into Court at the time of filing of the suit. A perusal of the records show that only on 6.1.1982 i.e, on the date of judgment of the trial Court, she has deposited the balance of sale consideration in the Court. With regard to the above aspect and in the light of Section 16(c) of Specific Relief Act, 1963, I am justified in holding that the plaintiff has not established her case that she was ready and willing to perform her part of the contract even on the date of the filing of the suit.

    15. Finally, the learned counsel for the respondent made a faint argument that inasmuch as both the Courts below have concurrently held in favour of the plaintiff, it is not open to this Court to interfere with the said concurrent findings under Section 100 of Civil Procedure Code, for which, he relied on the following decisions:

    (1) A.P Sagar and others v. Govindaswami Gramani, 1996 (I) M.L.J 146

    (2) O.T.M.O.M Meyyappa Chettiar v. O.T.M.S.M Kasi Viswanathan Chettiar and another, 1994 (1) M.L.J, S.C 28.

    While invoking Section 100 Civil Procedure Code it is not possible for this Court to reappraise or to reassess the evidence. However, the discussion of mine shows that both the Courts below have committed an error in holding that time is not the essence of the contract when Exs.A 1 and A. 2 clearly show the intention of the parties that time is the essence of the contract. Likewise, the plaintiff has not proved her case regarding readiness and willingness in order to perform her part of the contract. If the findings of the Courts below are not supported by evidence or passed on misconception or erroneous, and perverse this Court can interfere in the second appeal. Moreover, the relief of specific performance being an equitable relief, the same cannot be enforced in favour of a person who fails to prove that she has performed or has always been ready and willing to perform the essential terms of contract which are to be performed by her, other than the terms the performance of which has been prevented or waived by the defendant. In fine, it is clear from the evidence on record that the plaintiff/respondent was not ready and willing to perform her part of the contract and both the Courts below have committed an error in holding in favour of the plaintiff.

    16. Under these circumstances, the judgment and decree of the Courts below are set aside. The suit filed by the plaintiff O.S No. 1249 of 1980 on the file of the Subordinate Judge, Madurai, is hereby dismissed. The second appeal is allowed. However, in the facts and circumstances of the case, there will be no order as to costs.

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    Seeni Ammal v. Veerayee Ammal
    (Aug 9, 1996)