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Ramakrishna Pillai And Another v. Muhammed Kunju And Others
Factual and Procedural Background
Two separate suits for specific performance of agreements to sell immovable property were filed in 1987 before the Sub-Court, Mavelikkara:
- OS No. 11 of 1997 by Appellant 1 (agreement dated 20-8-1979 for 7.5 cents at a price of Rs 43,500, with Rs 27,000 paid in advance).
- OS No. 17 of 1987 by Appellant 2 (agreement dated 6-8-1979 for 3.5 cents at a price of Rs 32,000, with Rs 10,000 paid in advance and an adjustment of earlier security deposit).
The defendants were common to both suits: Defendant 1 (nephew of Defendant 2), Defendant 2 (husband of Defendant 3 and power-of-attorney holder), and Defendant 3 (owner of the property). Title to the property flowed through a series of transactions, including:
- Sale by Defendant 2, acting under a 1970 power of attorney given by Defendant 3, in favour of Defendant 1 on 17-5-1974.
- Subsequent cancellation of that power of attorney by Defendant 3 on 12-8-1974.
- A fresh 1979 power of attorney from Defendant 1 to Defendant 2, under which the impugned agreements with the appellants were executed.
When the defendants refused to execute the sale deeds in 1986, the appellants filed the present suits. The trial court (19-3-1992) dismissed the suits as time-barred while upholding the validity of the agreements. On appeal, the Kerala High Court (9-7-2001) held the suits to be within limitation and affirmed the validity of the agreements, yet dismissed them on the ground that the plaintiffs had not pleaded or proved their “readiness and willingness” as required for specific performance, instead ordering refund of advances already paid. The plaintiffs (appellants) challenged that dismissal before the Supreme Court.
Legal Issues Presented
- Whether the High Court erred in holding that the plaintiffs had not pleaded or proved their continuous readiness and willingness to perform their part of the agreements.
- Consequentially, whether the discretionary relief of specific performance should be decreed in favour of the plaintiffs notwithstanding the High Court’s contrary conclusion.
Arguments of the Parties
Appellants' Arguments
- The pleadings explicitly aver that the plaintiffs were “always ready and willing” to perform their contractual obligations; the High Court overlooked these averments.
- No such objection was ever taken in the written statements or cross-objections filed by the defendants; hence the High Court decided the matter on a ground never in issue.
- The trial court itself had extracted the relevant averments in its judgment, confirming that the plea was raised.
Respondents' Arguments
- Under Section 20 of the Specific Relief Act, courts must consider delay and other discretionary factors; the plaintiffs waited unreasonably long before filing suit.
- There was insufficient material to show that the plaintiffs were continuously ready and willing at all relevant times.
- Reliance was placed on several Supreme Court precedents emphasising stringent scrutiny of readiness and willingness in suits for specific performance.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| K.S. Vidyanadam v. Vairavan (1997) 3 SCC 1 | Parameters governing grant of specific performance, including delay and readiness/willingness. | Cited by respondents; the Supreme Court did not find it decisive because the factual plea of unreadiness was never raised below. |
| K. Narendra v. Riviera Apartments (P) Ltd. (1999) 5 SCC 77 | Discretion of court under Section 20 and the need for continuous readiness and willingness. | Relied on by respondents; distinguished for the same reason as above. |
| V. Pechimuthu v. Gowrammal (2001) 7 SCC 617 | Requirement that plaintiff must plead and prove readiness and willingness. | Cited by respondents; Court held factual matrix differed because pleadings did contain the averment. |
| Manjunath Anandappa v. Tammanasa (2003) 10 SCC 390 | Discretionary nature of specific performance. | Referenced by respondents; not determinative in view of absence of contrary pleadings. |
| Pukhraj D. Jain v. G. Gopalakrishna (2004) 7 SCC 251 | Factors for exercising discretion in specific performance suits. | Same treatment as prior precedents; Court focused on pleadings and issues actually framed. |
Court's Reasoning and Analysis
The Supreme Court conducted a focused review of the pleadings, issues, and findings below, arriving at the following analytical steps:
- Pleaded Readiness and Willingness: The plaints in both suits contained categorical assertions that the plaintiffs were “always ready and willing” to perform their obligations. The trial court itself reproduced these averments; hence the High Court’s contrary observation was factually incorrect.
- No Contrary Plea by Defendants: Neither the written statements before the trial court nor the cross-objections before the High Court raised any defence alleging lack of readiness and willingness. Therefore, that issue never arose for adjudication.
- Error of Law by High Court: By non-suiting the plaintiffs on a ground not pleaded or argued by the defendants, the High Court acted contrary to settled procedural law. Its reliance on discretionary considerations under Section 20 was misplaced in the absence of the foundational factual dispute.
- Affirmation of Validity & Limitation: Both lower courts had already held the agreements valid and binding; the High Court additionally held the suits within limitation. Those concurrent findings remained unchallenged and thus conclusive.
- Entitlement to Specific Performance: With no legal impediment remaining, and given the plaintiffs’ demonstrated willingness to tender the balance consideration, specific performance was the appropriate relief.
Holding and Implications
APPEALS ALLOWED. The Supreme Court directed the respondents to execute the requisite sale deeds in favour of the appellants on receipt of the balance consideration within three months. Failing compliance, the appellants may approach the trial court for enforcement.
Implications are confined to the parties: the contractual transfers will now be completed, and the refund decree granted by the High Court stands superseded. The judgment turns on factual pleading defects rather than establishing a new legal precedent.
Dr. Arijit Pasayat, J.— Challenge in these appeals is to the judgment of a Division Bench of the Kerala High Court.
2. Background facts need to be noted in some detail.
3. Two suits were filed for specific performance of agreement to sell the suit properties. Appellant 1 is the plaintiff in OS No. 11 of 1997 which was filed in the Sub-Court, Mavelikkara on 23-2-1987. Appellant 2 is the plaintiff in OS No. 17 of 1987 which was filed on 28-2-1987. The three defendants were common to both the suits. Defendant 1 is Defendant 2's brother's son and Defendant 3 is the wife of Defendant 2. Defendant 3 obtained the property mentioned in the two suits under an exchange of properties between her and her husband i.e Defendant 2. She mortgaged the properties to Kerala Financial Corporation Limited. Sometime in 1970 Defendant 3 executed a power of attorney in favour of her Defendant 2 husband authorising him to deal with the property. On 17-5-1974 Defendant 2 sold portions of the property to Defendant 1 acting on the power conferred by the power of attorney vide Exts. A-8 and A-18. Subsequently on 12-8-1974, Defendant 3 cancelled the power of attorney.
4. In 1979 Defendant 1 executed a power of attorney authorising Defendant 2 to deal with the property. On the basis of such power of attorney he entered into an agreement with Appellant 2 on 6-8-1979 to sell 3.5 cents of the property and the structures for a price of Rs 32,000. An advance of Rs 10,000 was paid. Appellant 2 was then the tenant in possession of the structure and had paid Rs 7000 as security. It was agreed that the amount shall be adjusted against part-payment of the price fixed and Appellant 2 was to pay Rs 15,000 as the balance consideration. The agreement indicated that possession was delivered to Appellant 2.
5. On 20-8-1979 Defendant 2 as power-of-attorney holder entered into an agreement to sell 7.5 cents of property with structures to Appellant 1 for consideration of Rs 43,500, out of which Rs 27,000 was paid as advance. Appellant 1 was already in possession of the structure as tenant. The terms of the agreement i.e Ext. A-1 are similar to those of Ext. A-14. Since Defendant 3 did not discharge the dues to the Financial Corporation, recovery proceedings were started and the rent payable by the appellant was attached. It appears thereafter there was a dissension amongst the defendants and Defendant 3 filed a suit (OS No. 42 of 1982) challenging the sales made by Defendant 2 to Defendant 1. The appellants were not parties to the said suit. Defendant 1 took the stand that the sales in favour of Defendant 2 as power-of-attorney holder were valid and Defendant 3 was not entitled to the relief prayed for. Thereafter the dispute was settled recognising the rights of Defendant 3. She undertook to honour all commitments made by Defendant 2 in respect of the property.
6. In 1986 the appellants called upon the defendants to execute the sale deed in their favour. A reply was given on 13-11-1986 refusing to execute the sale deeds. Two suits were filed, as noted above, for specific performance. There were clear averments to the effect that the appellants were and are always ready and willing to perform their part of the agreement. Defendants 1 and 3 contested the proceedings. It was their stand that the agreements sued on, namely, Exts. A-1 and A-19 are not valid and binding on the defendant. A plea of limitation was also taken. But there was no denial to the plea regarding readiness and willingness. There was specific reference to the earlier disputes between the defendants. The trial court by judgment and decree dated 19-3-1992 dismissed the suit as barred by limitation after holding on merits that the agreements are valid and binding on the defendant.
7. The plaintiffs filed separate appeals in the High Court. Defendant 3 also filed separate memo of cross-objections challenging the trial court's finding on the valid and binding nature of the agreements. By the impugned judgment dated 9-7-2001, the High Court affirmed the trial court's finding that the agreements are valid and binding, and also held that the suits were not barred by limitation. However, the High Court dismissed the suit on the ground that there was no plea raised regarding readiness and willingness and exercise of discretion. However, the High Court granted a decree for refund of the amount paid as advance covered by the agreement, but that no credit was to be given for further payments of Rs 3800 and Rs 4460 by the plaintiffs.
8. Learned counsel for the appellants submitted that the High Court fell into grave error by holding that the plea of readiness and willingness was not raised by the plaintiffs. In this connection, reference is made to averments in the plaint as noted in the judgment of the trial court. Reference was also made to the issues framed and the written statements filed by the defendants. It was pointed out that in the written statements there was no plea taken by the defendants that the plaintiffs were not ready and willing to fulfil their part of the obligation. It was, therefore, submitted that the High Court non-suited the plaintiffs on a ground which was not raised by the defendants and which was not considered by the trial court. It was also pointed out that factually the High Court was wrong in holding that no plea in that regard was taken.
9. Learned counsel for the respondent on the other hand submitted, that while considering a case of this nature, the parameters of Section 20 have to be kept in view. It is pointed out that suits were not filed within a reasonable time and the subsequent events by considerable effect. It was submitted that the High Court has rightly held that there was no material to show that at all relevant points of time the plaintiffs were ready and willing to fulfil their part of the obligation. Reference was placed on several decisions of this Court in support of the stand e.g K.S Vidyanadam v. Vairavan (1997) 3 SCC 1, K. Narendra v. Riviera Apartments (P) Ltd. (1999) 5 SCC 77, V. Pechimuthu v. Gowrammal (2001) 7 SCC 617, Manjunath Anandappa v. Tammanasa (2003) 10 SCC 390 and Pukhraj D. Jain v. G. Gopalakrishna (2004) 7 SCC 251.
10. There can be no quarrel with the position in law urged by learned counsel for the respondent about the parameters to be considered while dealing with a suit for specific performance. But the High Court's judgment is clearly vulnerable. Firstly, there was no dispute ever raised by the defendants about the readiness and willingness of the plaintiffs to fulfil their obligations. The High Court was clearly in error in holding that no plea regarding readiness and willingness was raised. As noted above, the trial court in its judgment has referred to various portions of the averments in the plaint where the plaintiffs had categorically stated that they were and are always willing to fulfil their part of the obligations. The High Court also failed to notice that there was no plea either in the written statement or in the cross-objections filed in the appeal before the High Court that the plaintiffs were not ready and willing to fulfil their part of the obligation.
11. The conclusions of the High Court are to the following effect:
“Then the question is whether the respective plaintiffs have pleaded and proved that they were always ready and willing to perform their part of the contracts. Even though time did not start to run on the expiry of two months from the dates of the agreements, certainly, the plaintiffs were aware that the defendants had to discharge their obligation and get a release of the mortgage in two months of the dates of the agreements. Until the sending of the notices preceding the suits, there is nothing to show that the plaintiffs at any time called upon the defendants to perform their part of the contract.”
12. The conclusions are clearly contrary to the pleadings of the plaintiffs. It was categorically stated in the plaint in both the suits that the plaintiffs are always ready and willing to fulfil their part of the obligations and that the defendants were evading the execution for one reason or the other.
13. Above being the position, the appeals deserve to be allowed, which we direct. The respondents shall execute the sale deed after receiving the balance of the consideration within a period of three months. If that is not done it shall be open to the appellants to move the trial court for necessary steps in that regard.
14. The appeals are allowed without any order as to costs.
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