DINESHKUMAR UPADHYAYA AND ANR. v. SMT. HANSA NIRANJAN VYAS AND ORS.

An agreement of sale in respect of plot no.4 at mouza Khamla admeasuring 3000 sq. fts. together with construction standing thereon was entered into in between the plaintiffs and one Niranjan Vyas on 6.10.1987 (Exh.29). It was for total consideration of Rs.2,27,500/-, out of which an amount of Rs.27,500/- was paid by way of earnest money vide Cheque No.018782, dt. 6.10.1987, which was acknowledged by the vendor. As per the terms of this agreement, the sale deed was to be executed within a period of 90 days upon receipt of balance consideration. The period of 90 days was to expire on 6.1.1988.

4. The said Niranjan Vyas died on 3.12.1987 and the defendants, who are the legal representatives of said Niranjan Vyas, executed separate agreement dt. 5.1.1988, and extended the time for making payment of balance consideration and execution of sale deed. Again on 12.1.1988, by executing separate agreement (Exh.30), adopted the terms of agreement dated 6.10.1987 at Exh.29 and the time for execution of sale deed was extended by a period of one month i.e. upto 12.2.1988. There is a dispute about at whose instance such extension of time was granted and the same shall be dealt with later on.

5. The Plaintiff no.2 Chandrakanta w/o. Dhirendrakumar Dixit issued cheque bearing No.264974 (Exh.31) for an amount of Rs.50,000/- in the

3

name of defendant no.1 Smt. Hansa w/o. Niranjan Vyas. The defendant no.1 acknowledged receipt of said cheque (Exh.32). This cheque was, however, dishonored on the ground of "not arranged for". There is controversy about the said cheque being against part payment on consideration and this controversy shall be dealt with latter on.

6. The defendants issued notice dt. 13.5.1988 (Exh.33) through their lawyer informing the plaintiffs that they have shown their inability to arrange for remaining sale consideration and have failed to perform their part of contract, as a result of which the agreement has become unenforceable in law. By this notice, the defendants revoked the agreements dated 6.10.1987 and 12.1.1988 and forfeited the amount of earnest money of Rs.27,500/-. The plaintiffs being irked by this notice, filed a complaint u/s. 420 of the Indian Penal Code dt. 20.6.1988 in the Court of Sessions Judge at Nagpur against the defendants (Exh.40). The defendants were, however, discharged by the learned Sessions Judge, Nagpur by his judgment and order dt. 11.1.1994 passed in Criminal Revision No.221 of 1992.

7. The plaintiffs filed Special Civil Suit No.591 of 1990 against the defendants on 6.8.1990, for specific performance of contract and prayed the reliefs as under :

4

"(a) grant a decree for specific performance of contract as per the agreement dated 6.10.1987 and further be pleased to direct the defendants to execute the sale-deed of the suit property in favour of the plaintiffs by receiving the balance consideration.

(b) execute the sale-deed in favour of the plaintiffs in case the defendants fail to execute the sale-deed after receipt of balance consideration.

( c) direct the defendants to develop the suit plot and incur the necessary expenses for the same.

(d) in the alternative, grant a decree for refund of earnest money paid to the defendants, in favour of the plaintiffs.

(e) saddle the costs of suit on the defendants, and

(f) grant any other relief which this Hon'ble Court deems fit in the facts and circumstances of the case.

8. The case of plaintiffs was that an agreement was entered into in between the plaintiffs and one Niranjan Vyas on 6.10.1987 for a consideration of Rs.2,27,500/-, out of which an amount of Rs.27,500/- was paid by way of earnest money on 6.10.1987 itself. As per the agreement, the sale deed was to be executed within a period of ninety days from the

5

date of agreement. According to them, said Niranjan Vyas represented to the plaintiff that the plot was developed and no development charges would be required to be paid to the Nagpur Improvement Trust. However, said Niranjan Vyas died on 3.12.1997 leaving behind the defendants as his legal heirs. It was further pleaded that the plaintiffs being ready to perform their part of contract, advanced a cheque of Rs.50,000/- in the name of defendant no.1 drawn on the State Bank of India, Central Avenue Branch bearing No.264974. However, when the plaintiffs visited the plot, it was found that the said plot was not developed and as such, they became aware of dishonest intention of the defendants. It was alleged that they were shocked by this unlawful act of defendants and hence, asked the bank to stop payment to the defendants. It was alleged that the plaintiffs were ready and willing to perform their part of contract. However, the defendants not only refused to execute the sale deed in favour of plaintiffs, but also revoked the agreement and forfeited the earnest money.

9. The defendants filed their common Written Statement (Exh.18) and denied the claim of plaintiffs. The trial Court framed the issues as under :

6

ISSUES FINDINGS

1. Do plaintiffs prove that, they have contacted to purchase the suit plot mentioned in para no.1 of the plaint for the consideration of Rs.2,27,500/- from Niranjan Vyas (i.e. father of defendant nos. 2 to 4) on 6.10.1987 ? ….. Yes.

2. Do they further prove that, they paid an earnest money of Rs.27,500/- to deceased Niranjan Vyas by cheque No. 018782, dated 6.10.1987 ? …... Yes.

3. Do they further prove that, in pursuance of the contract a cheque of Rs.50,000/- was given in the name of defendant no.1 of State Bank of India, Central Avenue Branch, bearing no.264974 ? …..... Yes.

4. Do they further prove that, they were ready and willing to perform the part of the contract as per agreement but defendants have not performed the part of contract as per agreement ? …...... No.

5. Do defendants prove that, suit of the plaintiff is not properly valued ? …...... No.

6. Do they further prove that, the suit of the plaintiff was false and frivolous as well as vexatious ? …...... Yes.

7. Are they entitled to recover the compensatory cost of Rs.10,000/- from the plaintiff ? …...... No.

8. Are plaintiffs entitled for the relief of specific performance of contract as prayed ? …...... No.

7

9. What decree, relief and costs ? …...... As per final order.

10. The plaintiffs in support of their claim examined plaintiff no.1 Dineshkumar Upadhyaya (PW 1), Plaintiff no.2 Chandrakanta Dixit (PW-2) and one Mr.Mohankumar Bhagat - an attesting witness (PW-3) to the agreement of sale (Exh.29). The defendants examined Jayesh Niranjan Vyas (DW 1), the defendant no.2 and Vinod Borkar (DW 2) - a bank employee.

11. The trial Court by its judgment and order dt. 14.8.1995 dismissed the suit on the basis of finding recorded on the core issue of readiness and willingness on the part of plaintiffs. The trial Court held that the plaintiffs have failed to prove that they were ready and willing to perform their part of contract in terms of agreement. It was held that Cheque of Rs.50,000/- was given by plaintiffs pursuant to the contract and the dishonour of cheque on the ground of "not arranged for", clearly established that the plaintiffs were not having sufficient funds to complete the transaction. The finding is also based upon the evidence of witness from bank Mr.Vinod Borkar (DW 2) and Exh.34 - Bank intimation of dishonour of cheque. It is also based upon the admission of plaintiff nos. 1 and 2 that they were not having sufficient funds when the said cheque

8

was issued. The contention of plaintiffs that they had stopped the payment of cheque amount as the property was not developed, was rejected for want of proof. It was also held that there was variance between the pleadings and proof. In respect of forfeiture of amount of Rs.27,500/-, it was held that the defendants could not use the property from 6.10.1987 because of the agreement and therefore, they have rightly forfeited the said amount.

12. Mr. Sirpurkar, learned Counsel appearing for the appellants/plaintiffs has urged that the trial Court has misconstrued the documents at Exhs. 29 and 30 as extension of time to pay the balance consideration at the instance of plaintiffs. According to him, Exh.29/agreement dt. 6.12.1987 created an obligation upon the defendants to produce all necessary documents and to execute the sale deed in favour of plaintiffs within a period of three months from the date of agreement. According to him, the plaintiffs were not required to do anything except to remain present before the Registrar, Nagpur with the balance amount of consideration as and when the defendants called upon them to get the sale deed executed, upon production of necessary documents. According to the learned Counsel, the plaintiffs have pleaded in the plaint that they were and are ready and willing to perform their part of contract i.e. to pay balance amount of consideration which was

9

sufficient compliance on their part. He urged that, the defendants, at no point of time, called upon the plaintiffs to get the sale deed executed on any stipulated date and time before the Registrar at Nagpur stating that they have procured all the documents necessary for execution of sale deed. According to him, the defendants required time to procure all such documents and complete the formalities which they could not complete due to death of Mr. Niranjan Vyas and hence, by agreement at Exh.30, time was extended at their instance to execute the sale deed. He urged that the trial Court was wrong in basing its findings on dishonour of cheque of Rs.50,000/- and it ought to have been seen that the said amount had nothing to do with the transaction of sale in question. Although he urged that the said cheque was given to the defendants as they were in need of money, he accepted that it was with an understanding that it would be adjusted towards the part of consideration. Mr.Sirpurkar, learned Counsel relied upon the following decisions of the Apex Court for several propositions stated below :

a. The first judgment relied upon by him is reported in

(2009) 2 SCC 582, Aloka Bose .vs. Parmatma Devi and Ors. (Para nos. 21 to 24) in support of his proposition that it was for the vendor to perform and fulfill the terms of agreement by executing the sale deed which he has failed to do.

10

b. The second judgment reported in (2008) 5 SCC 676,

Rameshwar Prasad (Dead) By LRS. vs. Basanti Lal (Para Nos. 8 to 10) in support of his contention that the conduct of plaintiff was unblemished throughout entitling him to specific relief.

c. The third judgment is reported in (2006) 12 SCC 146, Faquir Chand and anr. vs. Sudesh Kumari in support of his proposition that the plaintiff has to make averment that he has performed and has always been ready and willing to perform his part of contract.

d. Lastly, he has relied upon the judgment of this Court reported in 2008 (6) ALL MR 611, Avdel Tools and Services .vs. Trufit Fasteners Private Limited (Para no.6) for the proposition that it is not necessary to actually tender the money to show readiness and willingness.

13. As against the aforesaid contentions, Mr. Sadavarte, learned Counsel appearing for the defendants relied upon provisions of Section 16 ( c ) of the Specific Relief Act, 1963 r/w. Section 51 of the Indian Contract Act and has urged that it is for the plaintiffs to plead that they were and are ready and willing to perform their part of contract. According to him, the plaintiffs have failed to bring any evidence on record to establish that

11

they were ready and willing to perform their part of contract. He supported the finding of the trial Court that a cheque of Rs.50,000/- was paid by the plaintiffs towards part of balance consideration and it was dishonoured on the ground of 'not arranged for'. According to him, the plaintiffs had neither any funds nor capacity to get the sale deed executed in terms of the agreement and hence, the trial Court rightly dismissed the suit. He further urged that, at no point of time, the plaintiffs issued any notice calling upon the defendants to execute the sale deed after getting the amount of balance consideration. He urged that the suit is also filed at the very fag end of period of limitation. According to him, the only necessary document was the No-Objection Certificate from the Income Tax Department which the defendants had obtained. He further urged that the plaint averment shows that the plaintiffs have avoided to get the sale deed executed on the ground that the suit plot was not developed and that the development charges were not paid. According to him, none of these conditions were incorporated in the agreement and hence, breach was committed by the plaintiffs. Mr.Sadavarte, Adv. has Relied upon the following decisions of the Apex Court :

I. (2002) 9 SCC 582, Pushparani S. Sundaram and Ors. vs. Pauline Manomani James (Deceased) and Ors.

12

ii. (2004 )6 SCC 649, P. D'Souza .vs. Shondrilo Naidu.

iii. AIR 2008 SC 2050, Ramesh Prasad (D) by L.Rs. vs. Basanti Lal.

iv. AIR 2008 SC 2052, Seenivasan .vs. Peter Jebaraj and anr.

v. AIR 1999 SC 3804, M/s Arosan Enterprises Ltd. vs. Union of India and anr.

vi. AIR 1999 SC 3821, Smt. N. Nirmala .vs. Nelson Jeyakumar.

vii. V (2000) SLT 779, Ajaib Singh and Ors. vs. Smt. Tulsi Devi.

viii. V (2000) SLT 790, Rajendra Kumar .vs. Kalyan (Dead) by L.Rs.

ix. AIR 2000 SC 2408, Motilal Jain vs. Smt. Ramdasi Devi and Ors.

x. AIR 2000 SC 2411, M/s. Hindustan Shipyard Ltd. vs. State of Andhra Pradesh.

xi. AIR 1989 SC 606, Jawahar Lal Wadhwa and anr. vs. Haripada Chakroberty.

xii. AIR 1989 SC 611 - (Special Leave Petition (Civil) No.8566 of 1988, dt. 30.9.1988).

13

14. The first question required to be considered is about the nature of contract exhibited by an agreement dt. 6.10.1987 (Exh.29). By this agreement, the plaintiffs have agreed to pay the balance consideration of Rs.2,00,000/- before the Registrar at the time of registration of sale deed and the defendants have agreed to execute the sale deed in respect of the suit property within a period of ninety days from the date of agreement by producing the documents necessary to execute the sale deed. The agreement, thus, creates reciprocal promises to be simultaneously performed by the parties. Section 37 of the Indian Contract Act, 1872 deals with the obligation of parties to contract and states that the parties to the contract must either perform or offer to perform, their respective promises, unless such performance is dispensed with or excused under the provisions of this Act or any other law. None of the reciprocal promises created by the agreement at Exh.29 is either dispensed with or excused under the provisions of the Act or of any other law. Hence, both the parties are under obligation to offer to perform their respective promises.

15. Section 51 of the Indian Contract Act is relevant along with the illustration (a); same is, therefore, reproduced below :

14

"51. Promisor not bound to perform, unless reciprocal promisee ready and willing to perform. - When a contract consists of reciprocal promises to be simultaneously performed, no promisor need perform his promise unless the promisee is ready and willing to perform his reciprocal promise.

Illustrations :

(a) A and B contract that A shall deliver goods to B to be paid for by B on delivery. A need not deliver the goods, unless B is ready and willing to pay for the goods on delivery."

Bare perusal of Section 51 of the Indian Contract Act, 1872 re- produced above read with illustration (a) makes it clear that when a contract consists of reciprocal promises to be simultaneously performed, no promisor need to perform his promise unless the promisee is ready and willing to perform his reciprocal promise. Illustration (a) further makes it clear that it will be for the plaintiffs herein to show their readiness and willingness to pay the amount of balance consideration to get the sale deed executed and the defendants need not perform their reciprocal promise unless plaintiffs show their readiness and willingness to perform their reciprocal promise.

15

16. Section 16 ( c) of the Specific Relief Act, 1963 along with the explanation therein is relevant for the purpose of present case and the same is, therefore, re-produced below :

"16. Personal bars to relief. - Specific performance of a contract cannot be enforced in favour of a person -

(a)..........

(b).........

(c ) who fails to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than terms the performance of which has been prevented or waived by the defendant.

Explanation. - For the purposes of clause (c ), -

(I) Where a contract involves the payment of money, it is not essential for the plaintiff to actually tender to the defendant or to deposit in Court any money except when so directed by the Court;

(ii) the plaintiff must aver performance of, or readiness and willingness to perform, the contract according to its true construction.

16

Bare perusal of the aforesaid provision makes it clear that if the plaintiff fails to aver and prove that he has performed or has always been ready and willing to perform the essential terms of contract which are to be performed by him, then it creates a personal bar for him to get specific performance of contract.

17. A combined reading of Section 51 of the Indian Contract Act and Section 16(c) of the Specific Relief Act, 1963 makes it clear that it is for the plaintiffs to aver and prove that they have performed or has been ready and willing to perform the essential terms of contract and defendants cannot be compelled to perform their promise unless the plaintiffs establish before the Court that they were and are ready and willing to perform the essential terms of contract. Thus, the burden of proof to establish readiness and willingness to perform contract is upon the plaintiffs. Similarly, in case of promises to be performed simultaneously, it is for the plaintiffs to show that they were ready and willing to pay the amount of balance consideration to the defendants to get the sale deed executed.

18. The Apex Court in its decision reported in AIR 1996 SC 2095, His Holiness Acharya Swami Ganesh Dassji vs. Shri Sita Ram Thapar has explained the distinction between readiness to perform the

17

contract and willingness to perform the contract. In para 2 of the said judgment, the Apex Court has observed as under :

"2. There is a distinction between readiness to perform the contract and willingness to perform the contract. By readiness may be meant the capacity of the plaintiff to perform the contract which includes his financial position to pay the purchase price. For determining his willingness to perform his part of the contract, the conduct has to be properly scrutinised. There is no documentary proof that the plaintiff had ever funds to pay the balance of consideration. Assuming that he had the funds, he has to prove his willingness to perform his part of the contract. According to the terms of the agreement, the plaintiff was to supply the draft sale deed to the defendant within 7 days of the execution of the agreement, i.e. by 27.2.1975. The draft sale deed was not returned after being duly approved by the petitioner. The factum of readiness and willingness to perform plaintiff's part of the contract is to be adjudged with reference to the conduct of the party and the attending circumstances. The Court may infer from the fact and circumstances whether the plaintiff was ready and was always ready and willing to perform his part of the contract. The facts of this case would amply demonstrate that the petitioner/plaintiff was not ready nor capacity to perform his part of the contract as he had no financial capacity to pay the consideration in cash as contracted and intended to bite for the time

18

which disentitles him as time is the essence of the contract. "

19. Keeping in view the aforesaid distinction made by the Apex Court, the averments in the plaint are required to be seen. It is the case of plaintiffs that they were ready and willing to perform their part of contract and hence, advanced a sum of Rs.50,000/- by way of cheque in the name of defendant no.1 drawn on the State Bank of India bearing No.264974. It is pleaded that Mr.Niranjan Vyas assured them that the development of plot has been done and the plaintiff shall not be required to pay the development charges. However, it is further alleged that upon visit to the plot it was found that the plot was not developed and hence, the plaintiffs asked the bank to stop the payment to the defendants. Thus, from the averments made in the plaint, it is apparent that the plaintiffs have avoided to pay the part of balance consideration of Rs.50,000/- on the ground that the plot was not developed and the development charges were not paid. Mr.Sadavarte, Adv. for defendants has rightly pointed out that none of the agreements at Exhs. 29 and 30 contain any such stipulation that a developed plot would be given to the plaintiffs or that the plaintiffs would not be required to pay the development charges. In spite of it, a prayer is made in the plaint to direct the defendants to develop the suit plot and to incur the necessary

19

expenses for the same. The plaintiffs were, thus, wrong in insisting for compliance of conditions which were never part of contract. Thus, in my opinion, the plaintiffs were not justified in avoiding to make the payment of part of consideration for the aforesaid reasons.

20. So far as the cheque of Rs.50,000/- is concerned, the argument of Mr.Sirpurkar that it was not given towards part of consideration but was given to satisfy the financial needs of the defendants, is contrary to the pleadings and evidence on record. The plaintiffs have pleaded that they were ready and willing to perform their part of contract and hence, advanced a sum of Rs.50,000/- by way of cheque in the name of defendant no.1. This is also the oral evidence of plaintiffs. Moreover, it was accepted by Mr.Sirpurkar that the said amount was to be adjusted subsequently towards the payment of balance consideration. The contention that the cheque was not dishonoured on the ground of 'not arranged for', but it was on account of the fact that plaintiff no.2 asked the bank to stop the payment, is also not supported by any evidence on record, though it is pleaded in the plaint. The finding recorded by the trial Court that the cheque was dishonoured on the ground of 'not arranged for' is based upon the positive evidence on record in the form of Exh.34 i.e. intimation given by the bank and proved by the witness Vinod Borkar (PW 2) - an employee from the bank. In view of this, no fault can be found with the findings

20

recorded by the trial Court. The trial Court was, therefore, right in recording finding of variance between pleadings and proof.

21. The case of plaintiffs that a sum of Rs.50,000/- was advanced to the defendants to show their readiness to perform part of their contract did not find favour with the trial Court. On the contrary, the evidence led by the plaintiffs themselves indicated that though cheque of Rs.50,000/- was issued, plaintiff no.2 had no funds in her account. Plaintiff no.1 Dinesh in his cross-examination has stated as under :

" It is true that Rs.50,000/- was not in the account of plaintiff no.2 at the relevant time when she issued a cheque. It is true that the bank has issued a letter along with cheque Exh.31 and that letter is at Exh.34. The contents mentioned in Exh.34 are correct. It is not true that the pleadings mentioned in the plaint is false. I cannot assign any reason why I have not filed any document on record to show that I had directed the bank to stop the payment of cheque, Exh.31".

Plaintiff no.2 Chandrakala has also in her cross-examination stated as under :

" It is true that Rs.50,000/- was not in my account when the cheque Exh.31 was given to defendant no.1. "

21

22. It is true that, in view of clause (1) to the explanation in Section 16 ( c ) of the Specific Relief Act r/w. judgment of this Court reported in

2008 (6) ALL MR 611 (Avdedl Tools and Services vs. Trufit Fasteners Private Ltd.) (cited supra), it is not necessary actually to tender money to show the readiness. However, this does not mean that the proof of capacity of the plaintiffs to perform their part of contract, which includes the financial position to pay the purchase price, needs to be dispensed with. The admission given by both the plaintiffs, reproduced above, indicate that the plaintiffs had no funds when cheque of Rs.50,000/- was issued. The plaintiffs have not brought on record any oral or documentary evidence to establish their financial capacity to pay the balance consideration. In view of this, the plaintiffs have failed to establish their readiness to perform their part of contract.

23. So far as willingness on the part of plaintiffs to perform their part of contract is concern, mere averment in the plaint to that effect is not enough. The plaintiffs must lead evidence to show their conduct to establish their willingness to perform the contract. Although, the agreement in question was executed on 6.10.1987 and an amount of Rs.27,500/- was paid by way of earnest money on the same date, the plaintiffs have not produced on record any evidence to show that they had either orally or in writing called upon the defendants to execute the sale

22

deed by accepting balance amount of consideration within a period of ninety days i.e. upto 6.1.1988. It may be true that, as per Exh.30 - separate agreement dt. 12.1.1988, the time for execution of sale deed might have been extended at the instance of the defendants; but, that did not prevent the plaintiffs from showing their anxiety to get the sale deed executed. Although the time was extended upto 12.2.1988, the plaintiffs did not issue any notice nor called upon the defendants to execute the sale deed by accepting the balance amount of consideration. As per the agreement dt. 12.1.1988 (Exh.30), all the expenses of sale deed were required to be borne or incurred completely by the plaintiffs. The plaintiffs have not brought on record any evidence either oral or documentary to show that they had made all the preparations necessary to get the sale deed executed by keeping ready the balance of amount of consideration. The plaintiffs were expected to purchase the requisite stamp papers for getting the sale deed executed in terms of Exh.30 the agreement dated 12.1.1988 and to call upon the defendants to remain present in the Office of Sub-Registrar on 12.2.1988. However, there is no evidence on record to show any such preparations by the plaintiffs. Even after expiry of period on 12.2.1988, the plaintiffs did not call upon the defendants to execute the sale deed for a period of almost three years and a suit for specific performance is filed on 6.8.1990 i.e. just before expiry of period of limitation. Although time was not the essence of contract, this conduct on

23

the part of the plaintiffs clearly establishes that they slept for almost three years. This conduct of the plaintiffs and the attending circumstances clearly establish that the plaintiffs have failed to prove their willingness to get the sale deed executed.

24. The pleadings in the plaint indicate that the plaintiffs avoided to get the sale deed executed on the ground that the plot in question was not developed and/or the development charges in respect of the plot in question were not paid and that the No-Objection Certificate was not obtained by the defendants. Mr. Sirpurkar, Adv. has urged that when the plaintiffs have specifically pleaded that they were and are ready and willing to perform their part of contract, it was for the defendants to show that they had made all preparations for production of documents necessary for getting the sale deed executed. However, according to him, the defendants have failed to produce all the documents necessary for executing the sale deed and hence, it was breach of contract by the defendants when they have issued notice at Exh.33, dt. 13.5.1988 cancelling the contact and forfeiting the amount of earnest money.

25. The stand taken by the plaintiffs appears to be inconsistent. Although it was one of the grounds to avoid the contract that the plot was not developed, as assured and that the development charges were not

24

paid, it is urged that this shall not come in the way of plaintiffs to get the sale deed executed. Mr.Sadavarte, Adv. for defendants has rightly pointed out that none of the agreements at Exhs. 29 and 30 contained any such stipulations and therefore, the plaintiffs were not justified in avoiding to make the payment of part of consideration on that count. Although the agreement at Exh.30 recites that the defendants shall produce all the documents necessary for execution of sale deed, what were such documents to be produced by the defendants is not explained by both the plaintiffs in their evidence. The only reference in the pleadings as well as in the oral evidence of plaintiffs is regarding the No-Objection Certificate. However, none of the plaintiffs have stated as to from which Authority and what No-Objection Certificate the defendants were required to produce. There is no evidence brought on record to show that without production of any such document, the sale deed could not have been executed. Plaintiff no.1 in his cross-examination has stated that the condition of production of No-Objection Certificate does not find place in the agreement. When he was asked the question as to what is meant by necessary documents, he answered that the documents which are required for registration of sale deed. Plaintiff no.1 has further stated in his evidence that plaintiff no.2 was satisfied regarding title and ownership of the plot when agreement at Exh.29 was prepared. Similar is the evidence of plaintiff no.2. At no point of time, the plaintiffs ever issued any notice in writing or orally asked the

25

defendants to produce any specific document necessary for execution of sale deed. On the contrary, Mr.Sadavarte, Adv. appearing for the defendants has pointed out that No-Objection Certificate from the Income Tax Authorities was obtained and the same was kept ready at the time of execution of Sale deed. In view of this, it is clearly established that the plaintiffs have not only failed to prove their willingness to perform their part of contract, but, on the contrary, have committed breach of contract.

26. The first judgment relied upon by Mr. Sirpurkar in Aloka Bose's case (cited supra) decided by the Apex Court needs to be considered. I have gone through the said judgment. The trial Court as well as the Division Bench of the High Court, on the basis of materials in the form of oral and documentary evidence, had concluded that the vendee had performed her part of contract by paying earnest money and sending a notice conveying her willingness and readiness to pay the balance of sale consideration. The clauses in the agreement indicated that the vendor had to perform and fulfill the terms of the agreement by executing the sale deed on receipt of consideration. It was not a case where the issue involved was whether the plaintiff has pleaded and proved his readiness and willingness to perform his part of contract. The findings recorded by the Courts below in respect thereof were accepted by the Apex Court. In addition to this, the plaintiff had sent the notice conveying her willingness and readiness to pay the

26

balance of sale consideration and the defendants had failed to perform the terms of agreement. Hence, for all such reasons, the said judgment is, in my view, not applicable to the facts of the present case.

27. In the decision of the Apex Court in Rameshwar Prasad's case (cited supra) the question was whether the plaintiff was willing to comply with the terms of agreement in relation to payment of interest. The High Court had held that there was no specific plea regarding readiness to pay interest. The Apex Court upon examination of pleadings found that the High Court had committed an error in recording such findings. The matter was remanded back to the High Court for decision on merits. The said judgment also is not applicable to the facts of the present case.

28. The decision of the Apex Court in Faquir Chand's case (cited supra) was dealing with the requirement of pleadings. It was held that the language of Section 16 ( c ) does not require any specific phraseology, but only that the plaintiff must aver that he has performed or has always been ready and willing to perform his part of contract. It was held on facts that the plaintiff has established by his conduct that he had deposited the entire sale consideration in the Court and was also present at the Registrar's Office for registration of the document. This judgment is of no help to the petitioners for the reason that here - in the present case the

27

plaintiffs have failed to show their capacity to pay the amount and also did not establish their willingness to get the sale deed executed.

29. Both the learned Counsel have relied upon decision of the Apex Court reported in 2004 (6) SCC 649, P. D'Souza vs. Shondrilo Naidu. In this case, the issue was framed as to whether the plaintiff has proved that she was and has always been ready and willing to perform her part of contract. The trial Court answered the said issue in the negative and dismissed the suit. The High Court accepted the contentions advanced by the plaintiffs and held that, on the basis of the material on record, it was proved that the plaintiff has all along been ready and willing to perform her part of contract. The Apex Court accepted the said finding as binding on it and thus, the question of readiness and willingness on the part of plaintiff did not fall for consideration on merits. The said judgment is also, therefore, of no help to the plaintiffs in the case in hand.

30. In the light of findings which the trial Court has recorded on the question of readiness and willingness on the part of plaintiffs and the findings which I have recorded In this judgment, it is not necessary to consider the judgments cited and relied upon by Mr. P. S. Sadavarte, Adv. for defendants.

28

31. The alternate contention raised by Mr.Sirpurkar, Adv. is with regard to refund of amount of earnest money of Rs.27,500/- forfeited by the defendants on 13.5.1988 at Exh.33. The defendants have stated in this notice that, as a result of execution of the agreement that the defendants could not sell the property and have thereby suffered loss and damage; however, it is not known as to how the defendants have suffered any loss or damage. The prices of real estates are going higher and higher, of which judicial notice can be taken. The defendants have not produced any evidence on record to show the actual loss and damage caused because of non-performance of contract by the plaintiffs. There was no such stipulation in the agreements (Exh.29 and 30) to pay damages or forfeit amount of earnest money; the defendants were, therefore, not justified in forfeiting an amount of Rs.27,500/-. The plaintiffs are, therefore, entitled to get refund of earnest money of Rs.27,500/-. The defendants have wrongfully denied the said amount to the plaintiffs and hence, the defendants are liable to pay simple interest @ 6 % p.a. from the date 13.5.1988 till its realisation.

32. In the result, the instant appeal partly succeeds. The order of dismissal of Special Civil Suit No. 591 of 1990 for specific performance of contract passed by the learned 4^thJt. Civil Judge (Sr.Dn.), Nagpur by his judgment and order dt. 14.8.1995 is

29

maintained. The plaintiffs are held entitled to refund of amount of Rs.27,500/- from the defendants with simple interest @ 6 % p.a. from 13.5.1988 till the date of realisation of said amount, which the defendants shall jointly and severally be liable to pay. The parties shall bear their own costs.

JUDGE

jaiswal

30