Andhra Pradesh High Court – Amravati
Yekkala Venkata Subba Rao vs Alaparthi Nageswara Rao Another on 16 June, 2025
APHC010006172015
IN THE HIGH COURT OF ANDHRA PRADESH
AT AMARAVATI [3397]
(Special Original Jurisdiction)
MONDAY ,THE SIXTEENTH DAY OF JUNE
TWO THOUSAND AND TWENTY FIVE
PRESENT
THE HONOURABLE SRI JUSTICE VENUTHURUMALLI GOPALA
KRISHNA RAO
SECOND APPEAL NO: 580/2015
Between:
Yekkala Venkata Subba Rao ...APPELLANT/DEFENDANT No.1
AND
Alaparthi Nageswara Rao ...RESPONDENT No.1/PLAINTIFF
Yekkala Venkateswarlu …RESPONDENT No.2/DEFENDANT No.2
Counsel for the Appellant:
1. JUPUDI V K YAGNADUTT
Counsel for the Respondent No.1:
1.GANTA RAMA RAO, SENIOR COUNSEL, LEO LAW
REPRESENTING ASSOCIATESThe Court made the following:
Judgment:
This second appeal is filed aggrieved against the Judgment and decree
dated 30-4-2015 in A.S.No.11 of 2013 on the file of the X Additional District
Judge, Gurazala, Guntur District, in confirming the Judgment and decree
dated 25-8-2011 in O.S.No.107 of 2004 on the file of the Senior Civil Judge,
Gurazala.
2. The appellant herein is the 1st defendant, the 1st respondent is the
plaintiff and the 2nd respondent is the 2nd defendant in O.S.No.107 of 2004 on
the file of the Senior Civil Judge, Gurazala.
3. The plaintiff initiated action in O.S.No.107 of 2004 on the file of the
Senior Civil Judge, Gurazala, with a prayer for the relief of specific
performance of agreement of sale directing the 1st defendant to execute
a registered sale deed in his favour in pursuance of agreement of sale dated
07-7-1999 in respect of the schedule property and alternatively sought for
refund of advance amount of Rs.2,20,000/- with interest at 18% per annum
and for costs of the suit.
4. The learned Senior Civil Judge, Gurazala, decreed the suit with costs
against the 1st defendant directing him to execute a registered sale deed in
favour of the plaintiff in respect of the schedule property on receiving the
balance of consideration as deposited into Court and further, directing the
plaintiff to deposit the balance of consideration within one week from the date
of the judgment and on such deposit, the 1st defendant is entitled to withdraw
the amount and directed to execute a sale deed in terms of the decree, while
dismissing the suit against the 2nd defendant without costs. Felt aggrieved of
the same, the unsuccessful 1st defendant in the above said suit filed the
aforesaid appeal suit before the first appellate Court. The learned
X Additional District Judge, Gurazala, dismissed the first appeal with costs by
confirming the judgment and decree passed by the trial Court. Aggrieved
thereby, the unsuccessful 1st defendant/appellant approached this Court by
way of second appeal.
5. For the sake of convenience, both parties in the second appeal will
be referred to as they are arrayed in the original suit.
6. The case of the plaintiff, in brief, as set out in the plaint averments in
O.S.No.107 of 2004, is as follows:
(a) It is pleaded that the schedule property is a vacant site situated in
Piduguralla Gram Panchayat limits. The 1st defendant is the owner of the suit
schedule site and he agreed to sell the same to the plaintiff on 07-7-1999 for
a lawful consideration of Rs.2,70,000/- and on the same day, the 1st defendant
received Rs.2,20,000/- towards sale consideration from the plaintiff and the
balance of sale consideration of Rs.50,000/- to be paid at the time of
registration by the plaintiff to the 1st defendant and he got executed an
agreement of sale for the suit schedule property in favour of the plaintiff by
receiving Rs.2,20,000/- as part of sale consideration.
(b) It is further pleaded that the plaintiff demanded the 1st defendant to
execute a registered sale deed in his favour in respect of the suit schedule
property by receiving the balance sale consideration of Rs.50,000/-, but the
1st defendant did not execute a registered sale deed and postponed the same
by one pretext or the other. The plaintiff expressed his readiness and
willingness to perform his part of the contract and in spite of repeated
demands made by him, the 1st defendant pretended to create some false
documents in favour of the 2nd defendant, who is his close relative, to defeat
the right of the plaintiff. On 24-8-2004, the plaintiff got issued a legal notice to
the defendants 1 and 2 and requested the 1st defendant to execute
a registered sale deed for the suit schedule property, but the 1st defendant did
not execute any document. Hence, the plaintiff was constrained to file the suit
for specific performance of contract against the 1st defendant for execution of
a regular registered sale deed for the suit schedule property basing on the
agreement on 07-7-1999, alternatively to direct the 1st defendant to return the
earnest money of Rs.2,20,000/- with interest at 18% per annum to the plaintiff
and for costs of the suit.
7. The 1st defendant filed written statement denying the contents of
plaint averments and further contended as follows:
(a) It is contended that the 1st defendant acquired the suit schedule
property for his family necessities and has been in possession and enjoyment
of the same. There is no necessity for him either to sell the said property to
the plaintiff or to execute a false document in favour of the 2nd defendant.
(b) It is further contended that there were disputes between the
1st defendant and one Reddy Venkata Koteswara Rao @ Kondalu during the
year 1999 and for settlement of the said disputes, the mediators viz., Varla
Ratnam, Yakkala Amara Lingeswara Rao, Challa Vengala Reddy etc.,
obtained the signatures of both the 1st defendant and Reddy Venkata
Koteswara Rao @ Kondalu on Rs.100/- stamp papers (Rs.50/- + Rs.50/-) and
also on blank promissory notes and the said papers were kept with the
plaintiff. Subsequently, the disputes were not settled and no compromise was
effected and the plaintiff in collusion with the above said Koteswara Rao has
been dragging on the matter on one pretext or the other. Thus, the
1st defendant obtained a decree against Koteswara Rao for auctioning of his
properties.
(c) It is further contended that the plaintiff is the Chairman of
Pradhamika Vyavasaya Sahakara Parapathi Sangha Bank. The plaintiff in
collusion with the Secretary, by name V. Krishna Murthy, forged the signature
of 1st defendant and withdrawn an amount of Rs.20,000/- on 26-12-2002 and
availed the entire amount by both of them for their own purposes secretly.
Subsequently, both of them made to believe the 1st defendant that they are
going to auction a house of one creditor and they will give sale agreement in
his favour for Rs.1,10,000/- and obtained his signature to withdraw an amount
of Rs.54,500/- from his account, on a blank form as well as the signature of
the 1st defendant’s wife, by name Kanaka Durga.
(d) It is further contended that the plaintiff obtained sale agreement on
07-7-1999 after paying a sum of Rs.2,20,000/- and has been waiting to get
regular registered sale deed after paying the balance consideration of
Rs.50,000/- and waited for five years, that he approached the Court with
unclean hands. The attestor and the scribe are close friends to the plaintiff.
The suit agreement is a sham document and thus, the plaintiff is not entitled to
seek for the relief of either specific performance or for refund of amount and
thus the suit is not maintainable. He prayed to dismiss the suit with costs.
8. The 2nd defendant remained set ex parte.
9. On the basis of above pleadings, the learned Senior Civil Judge,
Gurazala, framed the following issues for trial:
(1) Whether the plaintiff is entitled to the relief of specific performance
as prayed for ?
(2) Whether the plaintiff in the alternative is entitled to recover
Rs.2,20,000/- as claimed by him from the defendant ?
(3) Whether the signatures of the defendant was obtained forcibly by
the plaintiff ? and
(4) To what relief ?
10. During the course of trial in the trial Court, on behalf of the plaintiff,
P.Ws.1 to 3 were examined and Exs.A-1 to A-6 were marked. On behalf of
the 1st defendant, D.Ws.1 and 2 were examined and Exs.B-1 to B-10 were
marked.
11. The learned Senior Civil Judge, Gurazala, after conclusion of trial,
on hearing the arguments of both sides and on consideration of oral and
documentary evidence on record, decreed the suit with costs. Felt aggrieved
thereby, the unsuccessful 1st defendant filed the appeal suit in A.S.No.11 of
2013 before the learned X Additional District Judge, Gurazala, wherein, the
following point came up for consideration:
Whether the judgment and decree of the trial Court is sustainable in
law ?
12. The learned X Additional District Judge, Gurazala, i.e., the first
appellate Judge, after hearing the arguments, answered the point, as above,
against the 1st defendant/appellant and in favour of the plaintiff/1st respondent
and dismissed the appeal suit filed by the 1st defendant. Felt aggrieved of the
same, the unsuccessful 1st defendant in O.S.No.107 of 2004 filed the present
second appeal before this Court.
13. On hearing both side counsels at the time of admission of the
second appeal, on 08-11-2016, the composite High Court of Andhra Pradesh
at Hyderabad, framed the following substantial questions of law:
(1) Whether the suit sale agreement-Ex.A1 dated 07-7-1999 is not duly
executed, valid and supported by consideration from the version of the
defendant, of the plaintiff obtained signatures on the blank/blank stamp papers
and taking advantage of the same to act as mediator misused the same and
still the conclusion of the trial Court that from the signatures admitted contents
follow including, no doubt, with reference to the evidence of attestors is
sustainable, in view of the law laid down by the Apex Court in Abdul Jabbar v.
Venkata Sastri (AIR 1969 SC 1147) as and when presumption from the
admission of signature to be drawn and when not to draw ?
(2) Whether the suit sale agreement dated 07-7-1999, which contains
no stipulation for performance and the return notice of demand under Ex.A2
was after four years on 24-8-2004 in filing the suit in the same year subsequent
to the said reply-Ex.A3, is barred by limitation within the scope of Article 54 of
the Indian Limitation Act and even otherwise plaintiff is entitled to the equitable
and discretionary relief of specific performance and from the gap between the
agreement and date of notice, whether constitutes the pre-requisite of ever-
ready and willing to perform his part of the contract ?
(3) Whether the equitable relief of specific performance to exercise the
discretion is giving undue hardship to the defendant rather to the plaintiff and
if so, the discretion exercised by the trial Court is unsustainable equally to
confirm the same by the lower appellate Court ?
(4) Whether the deciding of the appeal on merits by the lower appellate
Court by dismissing or rejecting the application for adjournment from change of
advocate and even dismissing or rejecting the application to reopen
subsequently in saying taken as heard is contrary to the spirit of Order 41, Rule
17 C.P.C and liable to be set aside ? and
(5) To what result ?
14. Heard Sri Jupudi V.K. Yagnadutt, learned counsel for the
appellant/1st defendant and Sri Ganta Rama Rao, learned Senior Counsel
representing M/s. Leo Law Associates appearing for the 1st respondent/
plaintiff.
15. Dealing with the scope of Section 100 of the Code of Civil
Procedure, the Apex Court in the case of Kulwant Kaur v. Gurdial Singh
Mann (Dead) By Lrs1 held as follows:
“34. … … … Section 100 has introduced a definite restriction on to the
exercise of jurisdiction in a second appeal so far as the High Court is
concerned. Needless to record that the Code of Civil Procedure (Amendment)
Act, 1976 introduced such an embargo for such definite objectives and since
we are not required to further probe on that score, we are not detailing out,
but the fact remains that while it is true that in a second appeal a finding of
fact, even if erroneous, will generally not be disturbed but where it is found
that the findings stand vitiated on wrong test and on the basis of assumptions
and conjectures and resultantly there is an element of perversity involved
therein, the High Court in our view will be within its jurisdiction to deal with the
issue. This is, however, only in the event such a fact is brought to light by the
High Court explicitly and the judgment should also be categorical as to the
issue of perversity vis-à-vis the concept of justice. Needless to say however,
that perversity itself is a substantial question worth adjudication — what is
required is a categorical finding on the part of the High Court as to perversity.
… … …”
The Apex Court in the case of Yadavarao Dajiba Shrawane v. Nanilal
Harakchand Shah (Dead) and Ors.,2 held as follows:
“31. From the discussions in the judgment it is clear that the High Court has
based its findings on the documentary evidence placed on record and
statements made by some witnesses which can be construed as admissions
or conclusions. The position is well settled that when the judgment of the final
court of fact is based on misinterpretation of documentary evidence or on
consideration of inadmissible evidence or ignoring material evidence the High
Court in second appeal is entitled to interfere with the judgment. The position
is also well settled that admission of parties or their witnesses are relevant
pieces of evidence and should be given due weightage by courts. A finding of
fact ignoring such admissions or concessions is vitiated in law and can be
interfered with by the High Court in second appeal. Since the parties have
been in litigating terms for several decades, the records are voluminous.
1
(2001) 4 SCC 262
2
(2002) 6 SCC 404
The High Court as it appears from the judgment, has discussed the
documentary evidence threadbare in the light of law relating to their
admissibility and relevance.”
In the case of Hero Vinoth (Minor) v. Seshammal 3 , the Apex Court
held as follows:
“19. It is not within the domain of the High Court to investigate the grounds on
which the findings were arrived at, by the last court of fact, being the first
appellate court. It is true that the lower appellate court should not ordinarily
reject witnesses accepted by the trial court in respect of credibility but even
where it has rejected the witnesses accepted by the trial court, the same is no
ground for interference in second appeal when it is found that the appellate
court has given satisfactory reasons for doing so. In a case where from
a given set of circumstances two inferences of fact are possible, the one
drawn by the lower appellate court will not be interfered by the High Court in
second appeal. Adopting any other approach is not permissible. The High
Court will, however, interfere where it is found that the conclusions drawn by
the lower appellate court were erroneous being contrary to the mandatory
provisions of law applicable or its settled position on the basis of
pronouncements made by the Apex Court, or was based upon inadmissible
evidence or arrived at by ignoring material evidence.” (emphasis supplied)In the present case on hand, on appreciation of the entire evidence on
record, the learned trial Judge decreed the suit filed for specific performance
of agreement of sale by the plaintiff and on re-appreciation of the entire
evidence on record, the learned first appellate Judge confirmed the judgment
passed by the learned trial Judge and both the Courts below have given
concurrent finding against which, the second appeal has been preferred by
the 1st defendant. The suit is based on Ex.A-1 agreement of sale said to have
been executed by the 1st defendant. The contention of the appellant is that he
never executed the agreement of sale Ex.A-1 in favour of the plaintiff.
16. Section 20 of the Specific Relief Act, 1963, defines that grant of
relief of specific performance is discretionary and the said discretion has to be
3
(2006) 5 SCC 545
exercised judiciously but not arbitrarily. The plaintiff cannot be punished by
refusing the relief of specific performance despite the fact that the execution of
agreement of sale in his favour has been established and proved and that he
is found to be always ready and willing to perform his part of the contract.
Not to grant a decree of specific performance despite execution of agreement
of sale is proved and the plaintiff is always ready and willing to perform his
part of the contract would encourage dishonesty.
17. The contention of appellant is that there were disputes between him
and one Reddy Venkata Koteswara Rao during the year 1999 and for
settlement of the said disputes, mediators Varla Ratnam, Yakkala Amara
Lingeswara Rao, Challa Vengala Reddy have obtained signatures of both the
1st defendant and Reddy Venkata Koteswara Rao on Rs.100/- stamp papers
(Rs.50/- + Rs.50/-) and also on blank papers and the said papers were kept
with the plaintiff. The appellant further pleaded that since the disputes were
not settled and the plaintiff in collusion with Reddy Venkata Koteswara Rao
has been dragging on the matter. The appellant further pleaded in the written
statement itself that the plaintiff in collusion with the Secretary of Society,
by name V. Krishna Murthy, forged the signature of 1st defendant and
withdrawn an amount of Rs.20,000/- on 26-12-2002 and availed the entire
amount by both of them for their own purpose secretly. The 1 st defendant
further pleaded that the plaintiff obtained his signature to withdraw an amount
of Rs.54,500/- from his account in the Cooperative Society and the plaintiff
also obtained his signatures on blank form as well as the signature of his wife.
Since the 1st defendant is admitting the signatures on Ex.A-1 agreement but
disputing Ex.A-1 agreement sale transaction, the evidence on record has to
be scrutinized with care and caution. Both the Courts below arrived at
a concurrent finding that the plaintiff is entitled to the main relief of specific
performance of agreement of sale. The plaintiff proved Ex.A-1 agreement
through P.Ws.2 and 3. P.W.2 is one of the attestors in Ex.A-1 agreement of
sale. P.W.3 is the scribe of Ex.A-1 agreement of sale. It is not the case of
appellant that he is having enmity with the attestors and that they deposed
falsehood against him. To disprove Ex.A-1 agreement of sale and to prove
the defence put-forth by him in the written statement, the 1st defendant
examined himself as D.W.1. He admitted the signatures on Ex.A-1 agreement
of sale. As per his own statement in his evidence, the signatures on Ex.A-1
agreement belong to him and he is not having personal disputes with both the
attestors.
18. It was contended by the appellant that the plaintiff is the president of
Cooperative Society/Bank. The contention of appellant/1st defendant is that
being the President of Cooperative Society, the plaintiff obtained his
signatures on blank papers and fabricated Ex.A-1 agreement of sale. But, the
1st defendant admitted in his evidence in cross-examination itself that he is not
a member in the Cooperative Society. In case if he is not a member of the
Cooperative Society, obtaining a loan from the Cooperative Society in which
the plaintiff worked as President of the Society does not arise.
19. As per the evidence of D.W.2, he came to know that the plaintiff
used the empty Non-Judicial stamp papers as an agreement of sale in his
favour alleged to have been sold by the 1st defendant and filed the present
suit. Therefore, the above admission of D.W.2 goes to show that he is not
having any personal knowledge about the sale transaction. As per the
pleadings in the written statement of the 1st defendant, the mediators have
obtained his signatures and that of Reddy Venkata Koteswara Rao on stamp
papers and kept the same with the plaintiff. But, as per the statement of
D.W.2, the 1st defendant and Reddy Venkate Koteswara Rao purchased
stamp papers as per the own instructions of the plaintiff and handed over the
same to the plaintiff.
20. It is well settled that no party should be permitted to travel beyond
its pleading and that all necessary and material facts should be pleaded by the
party in support of the case set up by it. In the case of Kashinath (Dead)
through LRs v. Jaganath4, the Apex Court held that where the evidence is
not in line with the pleadings and is at variance with it, the said evidence
cannot be looked into or relied upon. Therefore, it is not safe to rely on the
evidence of D.W.2. For the aforesaid reasons, I am of the considered view
that Ex.A-1 agreement of sale is duly proved by the plaintiff, but the
1st defendant failed to prove the defence put-forth by him in the written
statement. It is open to the appellant to prove that the case set up by the
plaintiff on the basis of the recitals in Ex.A-1 agreement or the case set up in
the suit notice or in the plaint is not true, but the appellant failed to prove the
same.
21. It was contended by the appellant that Ex.A-1 agreement of sale is
dated 07-7-1999 and after a lapse of four years, the plaintiff issued a legal
notice on 24-8-2004 to execute a regular registered sale deed and that the
plaintiff failed to prove the ingredients under Section 16(c) of the Specific
Relief Act and that the plaintiff is not entitled to the relief of specific
performance of agreement of sale. In the case on hand, Ex.A-1 agreement of
sale is said to have been executed on 07-7-1999 by the 1st defendant.
The recitals in Ex.A-1 agreement of sale are, from out of total sale
consideration of Rs.2,70,000/-, a substantial amount has been paid by the
plaintiff to the 1st defendant and a paltry amount of Rs.50,000/- has to be
unpaid and the remaining balance of sale consideration is Rs.50,000/- only.
The recitals in Ex.A-1 agreement of sale are that as and when the plaintiff paid
Rs.50,000/-, the 1st defendant has to execute a regular registered sale deed in
favour of the plaintiff. Therefore, the time is not an essence of the contract.
On 24-8-2004, the plaintiff got issued a legal notice to the 1st defendant by
demanding him to execute a regular registered sale deed and a week time
was fixed to perform the part of the contract by the 1st defendant and later on
01-9-2004 the plaintiff filed the present suit. Ex.A-3 shows that on 17-9-2004
subsequent to filing of the suit only, the 1st defendant issued a reply notice by
denying the contents of legal notice. Article 54 of the Limitation Act deals with
4
(2003) 8 SCC 740
suits for specific performance of the contract. The limitation to file a suit for
specific performance of contract of sale is the date fixed by parties or if no
such date is fixed when the plaintiff has noticed that performance is refused.
The plaintiff herein filed the suit on 01-9-2004, therefore the suit is not at all
barred by limitation.
22. Admittedly, in the case on hand, time is not an essence of the
contract and no time limit was fixed for performance of the contract. From out
of the total sale consideration of Rs.2,70,000/-, a substantial amount of
Rs.2,20,000/- was paid to the 1st defendant and unpaid balance of sale
consideration is Rs.50,000/-, which is a meager amount. The recitals in
Ex.A-1 agreement of sale are that the 1st defendant has to execute a regular
registered sale deed as and when the balance amount of Rs.50,000/- was
paid by the plaintiff. It is the specific case of the plaintiff from the beginning in
the plaint itself that though he expressed his readiness and willingness to
perform his part of the contract in spite of repeated demands made by him
demanding the 1st defendant to receive the balance of sale consideration of
Rs.50,000/-, but the 1st defendant did not execute a regular registered sale
deed. As per the evidence of P.W.1, he demanded the 1 st defendant to
execute a regular registered sale deed in his favour by receiving the balance
of sale consideration of Rs.50,000/-, but the 1st defendant did not come
forward to perform his part of the contract. In the cross-examination, it was
not at all suggested to the plaintiff by the learned counsel for 1st defendant
that the plaintiff did not demand the 1st defendant to execute a regular
registered sale deed. It was not suggested to P.W.1 in the cross-examination
by the learned counsel for 1st defendant that there are laches on the part of
the plaintiff in obtaining a regular registered sale deed but not in favour of the
1st defendant. It was not suggested to the plaintiff in the cross-examination by
the learned counsel for 1st defendant that the plaintiff never demanded to
receive the balance of sale consideration of Rs.50,000/- and never demanded
the 1st defendant to execute a regular registered sale deed.
23. The learned counsel for appellant placed reliance on a judgment of
the Apex Court in the case of Rajesh Kumar v. Anand Kumar5, wherein the
Apex Court held as follows:
“10. Thereafter, in Man Kaur vs. Hartar Singh Sangha [(2010) 10 SCC 512],
this Court referred to its earlier decisions including Janki Vashdeo Bhojwani
(supra) and concluded thus in paras 17 & 18:
“17. To succeed in a suit for specific performance, the plaintiff has to
prove: (a) that a valid agreement of sale was entered into by the defendant in
his favour and the terms thereof; (b) that the defendant committed breach of
the contract; and (c) that he was always ready and willing to perform his part
of the obligations in terms of the contract. If a plaintiff has to prove that he
was always ready and willing to perform his part of the contract, that is, to
perform his obligations in terms of the contract, necessarily he should step
into the witness box and give evidence that he has all along been ready and
willing to perform his part of the contract and subject himself to cross-
examination on that issue. … … … .
18. ……………………………………………………………………………”
In the case on hand, the plaintiff produced a valid agreement in
between him and 1st defendant and the same was exhibited as Ex.A-1.
As per the recitals in Ex.A-1, time is not an essence of the contract. Out of
total sale consideration of Rs.2,70,000/- under Ex.A-1 agreement of sale,
a substantial amount of Rs.2,20,000/- was paid and unpaid balance of sale
consideration is Rs.50,000/- and the plaintiff stepped into the witness-box and
gave evidence as P.W.1. In the plaint and in his evidence, the plaintiff
constantly has taken a stand that though he demanded the 1 st defendant on
several occasions to execute a regular registered sale deed in his favour by
receiving the balance of sale consideration of Rs.50,000/-, the 1st defendant
did not come forward to discharge his part of the contract.
24. The learned counsel for appellant placed reliance on a judgment of
the Apex Court in the case of R. Shama Naik v. G. Srinivasaiah6, wherein
the Apex Court held as follows:
5
2024 SCC Online SC 981
“11. There is a fine distinction between readiness and willingness to
perform the contract. Both the ingredients are necessary for the relief of
specific performance.
12. While readiness means the capacity of the plaintiff to perform the
contract which would include his financial position, willingness relates to the
conduct of the plaintiff.”
Admittedly, in the case on hand, a substantial amount of Rs.2,20,000/-
from out of total sale consideration of Rs.2,70,000/- was paid on the date of
agreement itself, the possession is with the 1st defendant and the unpaid
balance amount is Rs.50,000/- only. Therefore, the facts and circumstances
in the cited decisions are different to the instant case.
25. The learned counsel for appellant placed a reliance on U.N.
Krishnamurthy (since deceased) through LRs v. A.M. Krishnamurthy 7
wherein the Apex Court held as follows:
“23. Section 16 (c) of the Specific Relief Act, 1963 bars the relief of specific
performance of a contract in favour of a person, who fails to aver and prove
his readiness and willingness to perform his part of contract. In view of
Explanation (i) to clause (c) of Section 16, it may not be essential for the
plaintiff to actually tender money to the defendant or to deposit money in
court, except when so directed by the Court, to prove readiness and
willingness to perform the essential terms of a contract, which involves
payment of money. However, Explanation (ii) says the plaintiff must aver
performance or readiness and willingness to perform the contract according
to its true construction.
24. To aver and prove readiness and willingness to perform
an obligation to pay money, in terms of a contract, the plaintiff would have to
make specific statements in the plaint and adduce evidence to show
availability of funds to make payment in terms of the contract in time. In other
words, the plaintiff would have to plead that the plaintiff had sufficient funds or
was in a position to raise funds in time to discharge his obligation under the
contract. If the plaintiff does not have sufficient funds with him to discharge
his obligations in terms of a contract, which requires payment of money, the6
2024 SCC Online SC 3586
7
(2023) 11 SCC 775
plaintiff would have to specifically plead how the funds would be available to
him. To cite an example, the plaintiff may aver and prove, by adducing
evidence, an arrangement with a financier for disbursement of adequate
funds for timely compliance with the terms and conditions of a contract
involving payment of money.”
The Apex Court in U.N. Krishnamurthy (7 supra), further held as
follows:
“42. In Saradamani Kandappan [Saradamani Kandappan v. S. Rajalakshmi,
(2011) 12 SCC 18 : (2012) 2 SCC (Civ) 104] this Court reiterated that:
42.1. While exercising discretion in suits for specific performance, the
courts should bear in mind that when the parties prescribed a time for taking
certain steps or for completion of the transaction, that must have some
significance and therefore time/period prescribed cannot be ignored.
42.2. The courts will apply greater scrutiny and strictness when
considering whether purchaser was ready and willing to perform his part of
the contract.
42.3. Every suit for specific performance need not be decreed merely
because it is filed within the period of limitation, by ignoring time limits
stipulated in the agreement. The courts will also frown upon suits which are
not filed immediately after the breach/refusal. The fact that limitation is three
years does not mean that a purchaser can wait for one or two years to file
a suit and obtain specific performance. The three year period is intended to
assist the purchaser in special cases, as for example where the major part of
the consideration has been paid to the vendor and possession has been
delivered in part performance, where equity shifts in favour of the purchaser.
43. In Atma Ram v. Charanjit Singh [Atma Ram v. Charanjit Singh, (2020)
3 SCC 311 : (2020) 2 SCC (Civ) 107] V. Ramasubramanian, J. speaking for
this Court made the following pertinent observation : (SCC p. 316, para 9)
“9. … No explanation was forthcoming from the petitioner for the long
delay of three years, in filing the suit (on 13-10-1999) after issuing a legal
notice on 12-11-1996. The conduct of a plaintiff is very crucial in a suit for
specific performance. A person who issues a legal notice on 12-11-1996
claiming readiness and willingness, but who institutes a suit only on
13-10-1999 and that too only with a prayer for a mandatory injunction carrying
a fixed court fee relatable only to the said relief, will not be entitled to the
discretionary relief of specific performance.”
In the case on hand, Ex.A-1 agreement of sale is duly proved.
In Ex.A-1, no specific time limit was fixed to perform the contract. As per the
recitals in Ex.A-1 agreement of sale, the total sale consideration is
Rs.2,70,000/- and a substantial amount of Rs.2,20,000/- was received by the
1st defendant and the remaining unpaid balance of sale consideration is
Rs.50,000/- only and that is to be paid at the time of registration of document
by the 1st defendant and the 1st defendant did not issue any legal notice to the
plaintiff to discharge his obligation. In fact, the plaintiff issued a legal notice to
the 1st defendant by fixing one week time in favour of the 1st defendant to
perform his part of the contract to receive the balance of sale consideration of
Rs.50,000/- and to execute a registered sale deed. Since there is no
response from the 1st defendant, the plaintiff filed the present suit on
01-9-2004 and the legal notice said to have been issued by the plaintiff is on
28-4-2004. Subsequent to the filing of the suit, the 1st defendant issued
a reply notice to Ex.A-2 legal notice. In fact, the 1st defendant did not issue
any legal notice to the plaintiff by informing that though he is ready and willing
to perform his part of the contract, but the plaintiff did not come forward to
discharge his obligation.
26. In the case of Shenbagam v. K.K. Rathinavel8, the Apex Court
held as follows:
“41. True enough, generally speaking, time is not of the essence in an
agreement for the sale of immoveable property. In deciding whether to grant
the remedy of specific performance, specifically in suits relating to sale of
immovable property, the courts must be cognizant of the conduct of the
parties, the escalation of the price of the suit property, and whether one party
will unfairly benefit from the decree. The remedy provided must not cause
injustice to a party, specifically when they are not at fault. … … …”.
In the case of K. Prakash v. B.R. Sampath Kumar9, the Apex Court
held as follows:
8
2022 SCC Online SC 71
9
(2015) 1 SCC 597
“16. The principle which can be enunciated is that where the plaintiff brings
a suit for specific performance of contract for sale, the law insists upon
a condition precedent to the grant of decree for specific performance : that
the plaintiff must show his continued readiness and willingness to perform his
part of the contract in accordance with its terms from the date of contract to
the date of hearing. Normally, when the trial court exercises its discretion in
one way or the other after appreciation of entire evidence and materials on
record, the appellate court should not interfere unless it is established that the
discretion has been exercised perversely, arbitrarily or against judicial
principles. The appellate court should also not exercise its discretion against
the grant of specific performance on extraneous considerations or
sympathetic considerations. It is true, as contemplated under Section 20 of
the Specific Relief Act, that a party is not entitled to get a decree for specific
performance merely because it is lawful to do so. Nevertheless once an
agreement to sell is legal and validly proved and further requirements for
getting such a decree are established then the court has to exercise its
discretion in favour of granting relief for specific performance.
17. …………………………………………………………………………………
18. Subsequent rise in the price will not be treated as a hardship entailing
refusal of the decree for specific performance. Rise in price is a normal
change of circumstances and, therefore, on that ground a decree for specific
performance cannot be reversed.”
In the case on hand, the 1st defendant denied the execution of Ex.A-1
agreement of sale, but admitted the signatures on agreement of sale.
The equitable discretion to grant or not to grant relief for specific performance
also depends upon the conduct of the parties. The necessary ingredients
have to be proved and established by the plaintiff so that discretion would be
exercised judiciously in favour of the plaintiff. At the same time, if the
defendant did not come with clean hands and suppressed material facts and
evidence and misled the Court, then said discretion should not be exercised
by refusing to grant specific performance. The 1st defendant simply denied
the execution of Ex.A-1 agreement of sale and the appellant does not come
with clean hands and suppressed the material facts and the evidence and
misled the Court. The plaintiff in order to prove his case, relied on the
evidence of P.Ws.1 to 3 and produced the original agreement of sale and
exhibited it as Ex.A-1. In the case on hand, the appellant disputed the
execution of Ex.A-1 agreement of sale, but the contention of the appellant is
that the plaintiff obtained his signatures on empty papers and those are
created as Ex.A-1 agreement of sale, but the same is not proved by the
appellant by adducing cogent evidence.
27. For the aforesaid reasons, the plaintiff is entitled to the main relief of
specific performance of agreement of sale. Both the Courts below came to
concurrent finding that the plaintiff in the suit is entitled to the main relief of
specific performance of agreement of sale. On appreciation of the entire
evidence on record, the learned trial Judge gave finding that the plaintiff is
entitled to the main relief of specific performance of agreement of sale.
On re-appreciation of the entire evidence on record also, the learned first
appellate Judge confirmed the judgment passed by the learned trial Judge.
The findings of fact recorded by both the Courts below were based on proper
appreciation of evidence and the material on record and there was neither
illegality nor irregularity in those findings and therefore, the findings do not
require to be upset. Therefore, the conclusions drawn by both the Courts
below are found correct. There is no need to interfere with the concurrent
finding arrived at by both the Courts below.
28. In the result, the second appeal is dismissed confirming the
judgments and decrees of both the Courts below. Pending applications,
if any, shall stand closed. Each party do bear their own costs in the second
appeal.
VENUTHURUMALLI GOPALA KRISHNA RAO,J