IN THE HIGH COURT OF JUDICATURE OF ANDHRA PRADESH AT HYDERABAD THURSDAY, THE SEVENTEENTH DAY OF FEBRUARY, TWO THOUSAND AND ELEVEN PRESENT THE HON’BLE SRI JUSTICE N.R.L.NAGESWARA RAO APPEAL SUIT No. 645 OF 2001 BETWEEN: Vattikuti Himakumari and another …APPELLANTS AND Chattu Anjaneyulu and another. …RESPONDENTS The Court made the following: THE HON’BLE SRI JUSTICE N.R.L. NAGESWARA RAO APPEAL SUIT No. 645 OF 2001 JUDGMENT: The plaintiff in O.S.No. 410 of 1989 on the file of the Additional Senior Civil Judge, Guntur, is the appellant herein. 2. The suit was filed for specific performance of an agreement of sale, dated 26-09-1985. 3. According to the case of the plaintiffs, the defendants have agreed to sell the schedule property at the rate of Rs.110 per square yard and took earnest money of Rs.15,000/-. As per the terms of the contract, balance of sale consideration has to be paid within three months and in case of default, it should carry an interest at 12% per annum. It was also further stipulated that the permission from the Urban Ceiling Authorities and Municipal Authorities have to be taken. The plaintiffs were ready and willing to perform the part of the contract and demanding the defendants to execute the sale deed, but they have been postponing it and they expressed their inability to produce the documents. Therefore, on 22-12-1988 the plaintiffs have got issued a legal notice to the defendants to complete the transaction, but they did not comply with it. Therefore, the suit was filed for specific performance of the contract of sale or in the alternative refund of the earnest money of Rs.15,000/- and for a sum of Rs.30,000/- as damages due to mental agony. 4. The defendants filed a written statement contending that the suit is barred by time. It was pleaded that after execution of agreement of sale, the plaintiffs approached the defendants stating that the crops for the year 1985-86 were failed, the 1st plaintiff suffered fracture and confined to bed and they requested some time and agreed to pay interest for the balance amount. The defendants were always ready and willing to perform their part of the contract. The plaintiffs were not ready and willing to perform the contract and the plaintiffs were not prepared to pay the interest, which is stipulated under the contract. The claim for damages due to mental agony is not tenable. Therefore, the suit is liable to be dismissed. 5. On the basis of the above pleadings, the following issues have been framed by the trial court, for trial: 1) Whether the plaintiff is entitled for specific performance of contract of sale? 2) Whether the plaintiff is entitled for refund of the amount and damages as prayed for? 3) Whether the suit is barred by law of limitation? 4) To what relief? 6. On behalf of the plaintiffs PWs. 1 and 2 were examined and marked Exs.A-1 to A-4. On behalf of the defendants DW.1 was examined and marked Exs.B-1 to B-3. 7. After considering the evidence on record, the learned Additional Senior Civil Judge, dismissed the suit of the plaintiffs. Aggrieved by the said judgment and decree, the present appeal is filed. 8. The points that arise for consideration are: 1) Whether the plaintiffs are entitled for the specific performance of the contract or in the alternative for refund of the earnest money and damages? 2) Whether the time is essence of the contract? 3) Whether the judgment and decree passed by the learned Additional Senior Civil Judge, Guntur, is legal and sustainable? 9. POINTS: There is no dispute between the parties that an agreement of sale was entered for sale of the schedule property on 26-09-1985 and a sum of Rs.15,000/- was paid as advance. It was also stipulated that the balance of sale consideration has to be paid within three months and on the failure of such payment within three months, interest should be paid at 12% per annum and in the meantime, the defendants were obtained necessary permission from the Municipal Authorities and the Urban and Ceiling Authority. When the plaintiffs expressed the readiness and willingness to get the sale deed executed and if the defendants are not able to deliver the property by measurements, then the amount of Rs.15,000/- has to be refunded with interest at 12% per annum. The terms are not in dispute. 10. The learned counsel for the appellants contends that the finding of the lower Court about the time is being essence of the contract is not correct and the dismissal of the suit on the above ground without considering the other contentions is not legal. Evidently, in case of sale of immovable properties, the law is well settled that time is not essence of the contract and the intention of the parties have to be gathered, if the parties have intended that the balance of sale consideration, which has to be paid within the stipulated time of three months, has to carry interest at 12% per annum. It is quite clear that the intention of the parties is not to treat time as essence of the contract. Therefore, in this case, the parties have stipulated the payment of interest, and therefore, the contention of the defendants in the lower court the time is essence of contract cannot be accepted. Added to that, mutual obligations are undertaken by both the parties. The defendants have to furnish the Urban Land Ceiling and Municipal clearance certificates, which is the term incorporated in the agreement Ex.A-1. Though the counsel for the respondents contends that such requirement is not there and it was so admitted by the plaintiffs also, still the terms under the agreement Ex.A-1 clearly stipulates that such certificate have to be taken. Evidently, the defendants have not informed the plaintiffs about the obtaining of the clearance certificates from the concerned authorities, though it is sought to be canvassed that by 1986 such certificates were with the defendants. Therefore, it is quite clear after obtaining the necessary permission, the defendants have not informed the plaintiffs about their readiness and willingness. Therefore, in this case, it is quite clear that the time, which is sought to be stipulated in EX.A-1 agreement, is not a condition precedent and the parties have never intended to treat as a starting period of limitation. Under Article 54 of the Limitation Act, if the parties have not fixed time or waived the condition of fixing of time. Naturally the period of limitation starts from the date of demand and refusal by the other party. Evidently, in this case, notice was given on 22-12-1988 and the suit was filed within three months thereafter. Therefore, in view of the above circumstances, I find that time is not the essence of contract and when time is not essence of the contract, the suit cannot be dismissed as barred by limitation. 11. The next question for consideration is whether the plaintiffs are entitled for the specific performance. Evidently, the plaintiffs have to pay the balance of consideration within three months and in case of default, the amount has to be paid with interest at 12% per annum. It is to be noted that within the stipulated time or after the stipulated time for a longer period, the plaintiffs have not issued any notice calling upon the plaintiffs to receive the money and register the sale deed. Their preparedness is essential to entitle for the relief of specific performance, when once the plaintiff has undertaken to pay the money within three months and even within the three months, he has not tendered the money or sent any notice to the plaintiffs about the readiness with the money. Even after the expiry of the period of three months as stipulated under Ex.A-1, the plaintiffs have not sent a notice calling upon the defendants to execute the sale deed. The law is now very well settled that before relief of specific performance can be granted, the plaintiffs shall prove that from the date of the agreement till the date of the institution of the suit and obtaining the decree, the plaintiffs are ready and willing to perform the contract. No explanation is given for a long silence on the part of the plaintiffs in not demanding the specific performance. If really the defendants are dodged the execution of the agreement, then the plaintiffs could have issued a notice about the laches on the part of the defendants. It is admitted by the plaintiffs in the evidence that no certificate of clearance is required though the condition was incorporated in the agreement. As can be seen from the contention of the defendants, the certificate was already available by 1986 and if really the plaintiffs have approached the defendants, there is no need for them to postpone the execution of the sale deed. Therefore, the conduct of the plaintiffs does not show their preparedness, willingness and readiness to get the contract performed. In view of the long silence on the part of the plaintiffs and also taking into consideration the change of the situation with regard to the value of the properties, the grant of relief of specific performance will only give undue advantage to the plaintiffs and such inequitable relief cannot be granted to the plaintiffs. 12. The learned counsel for the respondents relied on a citation reported in K.S. Vidyanadam and others Vs. Vairavan[1], wherein it was held that in a case time is fixed and party kept quite for a long time, specific performance is rejected. It is useful to refer to the judgment reported in S.Brahmanand and others Vs. K.R. Muthugopal (D) and others[2], wherein it was held that though original agreement fixed date for performance, but by subsequent conduct, performance was not insisted, time for performance stands extended and second part of Article 54 is applicable. 13. In this case, evidently, as per the terms of the contract, if the contract could not be performed, the defendants have undertaken to refund the money. If there is no term in agreement under Ex.A-1, the plaintiffs would not have been entitled for the refund of the advance of earnest money of Rs.15,000/-. But, however, in case of the breach of contract or the failure, the defendants have undertaken to refund the money a sum of Rs.15,000/- and the condition binding on the defendants there being no other qualification to avoid the said condition. The defendants are bound to refund the money. 14. So far as the claim for the mental agony or the damages are concerned, the claim is imaginary and probably to create the jurisdiction to the Senior Civil Judge, the valuation might have calculated and is not based on any principle of law or equity. Therefore, the claim for mental agony is rejected. 15. Therefore, in view of the above circumstances, I find that the plaintiffs will be entitled for refund of the amount of Rs.15,000/- from the date of agreement with interest at 12% per annum till the date of suit, and the subsequent interest is not granted in view of the blemishable conduct on the part of the plaintiffs also. 16. In the result, the appeal is partly allowed. Each party should bear their own costs. Date: 17-02-2011. ________________________ N.R.L.NAGESWARA RAO, J INL [1] AIR 1997 SUPREME COURT 1751 [2] AIR 2006 SUPREME COURT 40