IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.SASIDHARAN NAMBIAR FRIDAY, THE 5TH AUGUST 2011 / 14TH SRAVANA 1933 RSA.No. 865 of 2011() --------------------- AS.3/2010 of II ADDL.SUB COURT,ERNAKULAM OS.1082/2005 of I ADDL.MUNSIFF COURT, ERNAKULAM .................... RESPONDENT/DEFENDANT IN OS 1082/05 ON THE FILE OF --------------------------------------------------------------------- THANKAMANI, W/O.VENUGOPALAN, AGED 61, SHIJU MANDIRAM, KUMBALAM P.O., PANANGADU. BY ADV. SRI.T.K.RADHAKRISHNAN RESPONDENT(S): PLAINTIFF IN OS 1082/05 -------------------------------------- 1. K.A.MOHAMMAD, S/O.HASSAINAR, AGED 68, KAITHANATHARA HOUSE, KUMBALAM. 2. SECRETARY, PANANGAD SERVICE CO-OPERATIVE SOCIETY NO.655, PANANGAD P.O. THIS REGULAR SECOND APPEAL HAVING COME UP FOR ADMISSION ON 05/08/2011, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: M.SASIDHARAN NAMBIAR, J ........................................... RSA No.865 of 2011 ............................................ DATED THIS THE 5th DAY OF AUGUST, 2011 JUDGMENT First defendant in O.S.1082 of 2005 on the file of Munsiff Court, Ernakulam is the appellant. First respondent is the plaintiff and second respondent, the second defendant. First respondent instituted the suit for specific performance of Ext.A1 agreement for sale executed on 30.7.2004 whereunder appellant admittedly agreed to assign one cent of land within the boundary shown therein, to the first respondent for a total consideration of Rs.30,000/-. On the date of execution of the agreement, Rs.20,000/- was received by the appellant towards sale consideration as advance and agreed to execute the sale deed on receipt of the balance consideration within a period of six months. First respondent contending that he has always been ready and willing to perform his part of the agreement, instituted the suit for specific performance of the agreement for sale. He contended that appellant did not execute the sale deed though he sought execution of the sale deed by paying the balance rsa 865/2011 2 consideration. Second respondent was impleaded as appellant had mortgaged the property in favour of the second respondent society for a loan of Rs.1,50,000/- contending that existence of the mortgage was not disclosed. Appellant resisted the suit contending that he had disclosed the existence of the mortgage at the time of entering into the agreement for sale and the original period of six months fixed under Ext.A1 was extended for a further period of five months at the instance of the first respondent and though appellant was ready to execute the sale deed, first respondent did not prepare the draft before the expiry of the extended period of the agreement and hence first respondent has violated the agreement and he is not entitled to the decree for specific performance of agreement for sale. Second respondent resisted the suit contending that first respondent was a member of the society and she availed a loan of Rs.75000/- and mortgaged the entire properties and she has not paid the amount and as on that date, Rs.1,20,650/- is due and if at all there is any transaction between the appellant and respondent, it is subject to the charge available to the second respondent. 2. Learned Munsiff on the evidence of first respondent as rsa 865/2011 3 PW1 and Exts.A1 to A4, dismissed the suit holding that first respondent is not entitled to the decree for specific performance of the agreement finding that even if a decree for specific performance is granted, it will be subject to the charge for the amount due to the second respondent, who can proceed against the property. First respondent challenged it before Sub Court, Ernakulam in A.S.3 of 2010. Learned Sub Judge on re- appreciation of evidence, found that the agreement is for sale of one cent of the property belonging to appellant and on the evidence found that he is entitled to the decree for specific performance. The appeal was allowed and appellant was directed to execute a registered sale deed on the first respondent depositing the balance sale consideration of Rs.10,000/-. The decree is challenged in the second appeal. 3. Learned counsel appearing for appellant was heard. The argument of the learned counsel is that in Ext.A2 reply notice sent by the first respondent, he has expressed his unwillingness to obtain the sale deed as the property was mortgaged to second respondent and the mortgage was earlier to the agreement for sale and it was known to the first respondent. As the period fixed rsa 865/2011 4 under Ext.A1 expired, first appellate court was not justified in granting the decree for specific performance of the agreement for sale for the reason that first respondent did not seek an alternative decree for return of the advance amount. The learned counsel would argue that having found that Section 56 of the Transfer of Property Act is not applicable, first appellate court should not have found that first respondent is entitled to the benefit as provided under Section 56 of the Transfer of Property Act. Learned counsel relying on the decision of Apex Court in Academy of Nutrition Improvement V. Union of India (2011 (3) KLT Short Note 43) argued that time is the essence of the agreement and when evidence establish that first respondent was not prepared to perform his part of the agreement within the period, a decree for specific performance of agreement for sale should not have been granted. 4. On hearing the learned counsel, I do not find any substantial question of law involved in the appeal. Ext.A1 agreement is admitted. Appellant agreed to assign one cent of land belonging to him in favour of the first respondent for a total consideration of Rs.30,000/-. It is also admitted that on the date rsa 865/2011 5 of execution of the agreement on 30.7.2004, out of the sale consideration, an advance of Rs.20,000/- was paid by the first respondent and received by the appellant. What remains to be paid was only the balance of Rs.10,000/-. Ext.A1 provides for a period of six months to pay the balance consideration. Appellant agreed to execute the sale deed on receipt of the balance. It is also admitted by appellant that the period provided under Ext.A1 was extended further by five months. Therefore, the period would expire only on 30.6.2005. The suit was instituted in August 2005 within a period of three months from that date. In such circumstances, it cannot be said that there was much delay in filing the suit so as to disentitle the first respondent from getting a decree for specific agreement for sale. 5. Though the learned counsel vehemently argued that as the time is the essence of the agreement and as first respondent did not pay the balance consideration and did not get the sale deed executed, he is disentitled to get the discretionary relief, appellant did not come to the box and prove the allegations raised in the written statement. On the evidence, first appellate court rightly found that first respondent is entitled to get the sale rsa 865/2011 6 deed executed. The fact that there is a subsisting mortgage over the plaint schedule property in favour of the second respondent will not affect the decree granted by first appellate court. When there is a mortgage, second respondent is definitely entitled to proceed as against the plaint schedule property also. But that does not mean that a decree for specific performance cannot be granted if plaintiff is otherwise entitled. First appellate court on the facts and evidence rightly granted the decree. Appeal is dismissed. M.SASIDHARAN NAMBIAR, JUDGE lgk