IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.T.SANKARAN WEDNESDAY, THE 14TH JULY 2010 / 23RD ASHADHA 1932 AS.No. 706 of 1999(M) OS.213/1995 OF PRINCIPAL SUB COURT, NORTH PARAVUR APPELLANT: PLAINTIFF: -------------- MUHAMMED, S/O.ABDUL KHADAR, PARAPPURATH HOUSE, NJALAKAM, THRIKKAKARA. BY ADV. SRI.K.P.SREEKUMAR SRI.P.G.PARAMESWARA PANICKER, SENIOR ADVOCATE SRI.P.GOPAL RESPONDENTS: DEFENDANTS: --------------- 1. CHANDRIKA, D/O.KUNJAN, ERAMATHY HOUSE, MUPPATHADOM KARA, KADUNGALLOOR. 2. SATHY, D/O.KUNJAN, OF -DO- -DO- BY ADV. SRI.K.KARTHIKEYA PANICKER SMT.DAYA K. PANICKER THIS APPEAL SUITS HAVING BEEN FINALLY HEARD ON 12/07/2010, THE COURT ON 14/07/2010 DELIVERED THE FOLLOWING: K.T.SANKARAN, J. -------------------------------------------- A.S. NO. 706 OF 1999 F -------------------------------------------- Dated this the 14th July,2010 JUDGMENT The appellant instituted the suit for specific performance of Ext.A1 agreement dated 24.9.1994, for sale of the plaint schedule property having an extent of 10 cents of land, which is a portion of the larger extent of 28 cents. The trial court partly decreed the suit. The prayer for specific performance of the contract was rejected and the plaintiff was allowed to realise the advance amount of Rs.10,000/- with interest at 6% per annum from 24.3.1995 till the date of realisation with proportionate costs. The plaintiff is aggrieved by the rejection of the prayer for specific performance. 2. The consideration agreed upon was Rs.3,500/- per cent of land. An advance amount of Rs.10,000/- was paid by the plaintiff to the defendants. It was agreed that the transaction should be completed within a period of six months. There was a stipulation in the agreement that the defendants should measure out the property at their expense in the presence of the plaintiff and should entrust to A.S. NO.706 OF 1999 :: 2 :: the plaintiff the tax receipt and encumbrance certificate. It was also agreed that the sale price should be determined on the basis of the extent of the property actually found on measurement. The agreement was signed by the defendants only. 3. The case of the plaintiff was that he sought the assistance of the officers of the Village Office concerned for the purpose of measurement. When the measurement was in progress, on 15.3.1995, some of the neighbouring property owners raised objection regarding the boundary from which the measurements were taken. The measurement was accordingly postponed. On 24.3.1995, the plaintiff and the broker approached the defendants requesting them to perform their part of the contract. The defendants did not accede to the request. The plaintiff stated that he was always ready and willing to perform his part of the contract and the sale deed could not be executed because of the breach of contract committed by the defendants. As an alternative to the prayer for specific performance, a prayer for return of the advance amount and for awarding damages of Rs.25,000/- was claimed by the plaintiff. A.S. NO.706 OF 1999 :: 3 :: 4. The defendants admitted the execution of the agreement. They contended that time was the essence of the contract. They agreed to sell the property for the purpose of purchasing another property for the second defendant and she had entered into an agreement for the purchase of a property. This was duly informed to the plaintiff as well. The plaintiff assured that the transaction would be completed within six months or else he would make arrangement to sell the property to other persons. The plaintiff failed to comply with the promise. He was not having the required money for purchasing the property. He committed breach of contract. The plaintiff even tried to extend the period of performance by pressurizing the defendants with the help of police. The defendants contended that the Village Officer did not measure the property. The defendants were always ready to measure out the property and for that purpose they had engaged a person. On occasions where the defendants were ready to measure out the property, the plaintiff used to make excuses. At last, the plaintiff agreed to visit the property on 24.3.1995. He failed to do so. The defendants attended the Sub Registrar's Office, but the plaintiff did not attend. The defendants were ready and willing to perform their part of the contract. The plaintiff had committed the breach. The purpose for which the A.S. NO.706 OF 1999 :: 4 :: defendants agreed to sell the property did not fructify. The plaintiff is not entitled to get the relief of specific performance or to get the alternative relief for return of advance amount. The plaintiff is also not entitled to get any damages. 5. The plaintiff examined himself as PW1 and examined PWs.2 to 5 as witnesses on his side. The first defendant was examined as DW1. 6. The court below considered the question whether the case of the defendants that they made arrangement to measure out the property is true and held in the negative. It was also held that the defendants did not get the encumbrance certificate and did not pay land tax as stipulated in Ext.A1 and hand over those documents to the plaintiff. The trial court concluded in paragraph 7 of the judgment thus: “.. Thus the evidence shows that the defendants have not done their part of the agreement. Even then the defendants have contended that they had gone to the Sub Registrar's Office on 24th. The evidence adduced shows that the defendants have committed breach of contract. Issue is found accordingly.” A.S. NO.706 OF 1999 :: 5 :: This finding was arrived at on issue No.3 as to who committed the breach of contract. 7. Thereafter, the court below considered issue No.2, the issue being whether the agreement is enforceable. While discussing that issue, the evidence of Pws.2 to 4 was considered and it was held thus: “In view of the divergent versions given by the witnesses I am of the view that the evidence of the witnesses that they went to the plaint schedule, for measuring the property looks unbelievable.” 8. After arriving at the aforesaid findings, the court below considered the question whether the plaintiff was ready and willing to take the sale deed and whether he was having the requisite funds. The plaintiff is a coolie, who used to get only Rs.125/- per day as wages. PW1 stated that Rs.10,000/- was given as advance after taking the money from his wife's savings. The plaintiff also stated in evidence that he was having Rs.23,000/- in his bank account and it was his savings from wages. Thereafter, he changed his version and stated that his savings would come to Rs.15,000/-. His elder brother had given Rs.10,000/- and his brother-in-law had given A.S. NO.706 OF 1999 :: 6 :: Rs.2,000/- and thus he was having the requisite funds. It was admitted by PW1 that he had no money in his account at the time when he was examined. He agreed to produce the pass book, but he did not produce. The court below, on the basis of these findings, held that the claim of the plaintiff that he had the balance consideration with him cannot be believed. On the basis of this discussion, the court below held thus: “In such circumstances, the claim of the plaintiff that he was always ready and willing to take the sale deed cannot be accepted. Thus the plaintiff has not succeeded in proving his readiness and willingness to take the sale deed by paying the balance consideration. As such, it has to be found that the agreement is not enforceable.” 9. The court below negatived the claim of the defendants that they are entitled to get Rs.25,000/- as damages. The court below also held that the defendants could not forfeit the advance amount. Thus a decree was passed for realisation of the advance amount paid by the plaintiff to the defendants. 10. Sri.K.P.Sreekumar, learned counsel appearing for the appellant, submitted that having found in paragraph 7 of the judgment that the defendants had committed breach of contract, the A.S. NO.706 OF 1999 :: 7 :: court below could not have arrived at a contrary finding that the plaintiff failed to prove that he was ready and willing to perform his part of the contract. He also submitted that the decree for return of the advance amount was granted only on the finding that the defendants committed the breach and therefore, without filing an appeal or a memorandum of cross objection, the defendants cannot attack the finding in paragraph 7 referred to above, by recourse to Rule 22 of Order XLI of the Code of Civil Procedure. They cannot support the decree in so long as the finding in paragraph 7 stands. Sri.Sreekumar also raised a contention that the defendants' contention to dismiss the suit in toto having not been accepted, it could be treated that the defendants are aggrieved persons and, therefore, they should have filed an appeal or Memorandum of Cross Objection to challenge the finding that they committed the breach. An additional document was produced to show that the finding of the court below as to the non-availability of funds with the plaintiff is not correct. The pass book in the name of the plaintiff was produced as additional document. 11. On a careful consideration of the pleadings and evidence in the case, I do not find any ground to interfere with the findings of A.S. NO.706 OF 1999 :: 8 :: fact in paragraphs 7 and 8 of the judgment. In so far as the finding that the plaintiff was not having the required funds at the relevant time is concerned, on the basis of the evidence on record and due to the non-production of the pass book of the plaintiff, the court below could not be found fault with for arriving at the conclusion that the plaintiff was not ready with the balance consideration at the relevant time. The additional document (pass book) produced before this Court is accepted and marked as Ext.A2. The pass book shows that from 1994 to 28th March 1995, the balance available in the account of the plaintiff was less than Rs.100/-. On 28.3.1995, a sum of Rs.23,500/- was deposited making a total balance of Rs.23,567/-. Various amounts were withdrawn in April and May, 2005 and as on 26.5.2005, the balance was only Rs.567/-. I am of the view that the pass book does not prove that the plaintiff was having sufficient funds in his account. On the other hand, the entries in the pass book would fortify the finding rendered by the trial court that the plaintiff was not having the required funds. 12. The relevant portion of Section 16 of the Specific Relief Act reads as follows: A.S. NO.706 OF 1999 :: 9 :: “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 of the performance of which has been prevented or waived by the defendant.” A suit for specific performance can be filed by the seller or by the buyer. Whoever files the suit, specific performance of a contract cannot be enforced in favour of the plaintiff who fails to aver and prove readiness and willingness as provided in clause (c) of Section 16. The readiness and willingness should be proved by the person who claims specific performance of a contract. There may be mutual obligations on the part of the plaintiff or the defendant to perform certain terms as agreed upon between the parties. It may also occur that both the parties might have committed breach of certain terms of the contract. Even if the defendant has failed to perform a term in the contract that does not automatically entitle the plaintiff to get specific performance of a contract. On the failure of the plaintiff to prove his readiness and willingness, the suit for specific performance A.S. NO.706 OF 1999 :: 10 :: must fail, notwithstanding the failure to perform a term of the contract by the defendant. In the process of establishing that the plaintiff was ready and willing to perform his part of the contract and that he has always been ready and willing to perform the essential terms of the contract, the plaintiff may rely on the breach committed by the defendant. Depending on the facts and circumstances of each case, the contention raised by the defendant that the plaintiff failed to perform a particular term in the contract could be rejected by the court on a finding that the defendant committed breach in respect of that particular term in the contract. That does not mean that proof of breach of any of the terms of the contract by the defendant is proof of readiness and willingness on the part of the plaintiff as provided in clause (c) of Section 16. Readiness and willingness on the part of the plaintiff has to be independently established to enable him to get a decree for specific performance. Of course, in arriving at the conclusion as to whether the plaintiff has proved his readiness and willingness, the court could take note of a breach committed by the defendant. That is in the realm of appreciation of evidence. It cannot be said that proof of breach committed by the defendant would result in proof of the readiness and willingness on the part of the plaintiff. Section 16 is couched in a negative form. It mandates A.S. NO.706 OF 1999 :: 11 :: that specific performance of a contract cannot be enforced in favour of a person who failed to aver and prove his readiness and willingness to perform his part of the contract. Breach of contract or any term of the contract by the defendant does not find a place in Section 16. In my view, the breach committed by the defendant has to be considered by the court only in the process of arriving at a conclusion on facts as to whether the plaintiff has proved his readiness and willingness. I am not inclined to accept the contention raised by Sri.K.P.Sreekumar that the finding in paragraph 7 of the judgment could lead only to the conclusion that the plaintiff was ready and willing to perform his part of the contract. 13. Sri.Sreekumar relied on the decision in Santha v. First Additional District Judge, Ernakulam and others (ILR 1994(2) Kerala 478 = 1994(1) KLT 516) in support of his contention that the defendant is a person aggrieved and, therefore, he should have filed an appeal or a Memorandum of Cross Objection. It was held in the above case that where a landlord files a petition on different grounds and the Rent Control Court allows the petition on one or some of the grounds, the landlord would be entitled to challenge the finding on the grounds which were rejected. However, in paragraph 19 of the A.S. NO.706 OF 1999 :: 12 :: judgment it was held thus: “19. This is only to clarify the position so far as the landlord's right to maintain an appeal or revision is concerned, but our other conclusion remains that it is unnecessary for the landlord to file an appeal or revision himself in such cases and that he can take up his pleas regarding the disallowed grounds in any appeal or revision which the tenant may file, on the principles of Order 41, rule 22.” In Santha's case, the question which arose for consideration was, in a Revision filed by the landlord challenging the order under Section 11(3) of the Kerala Buildings (Lease and Rent Control) Act, whether the respondent-tenant could challenge the finding of the authority below in respect of one limb of the same ground, arrived at against him. The Division Bench held that the principles of Rule 22 of Order 41 of the Code of Civil Procedure would apply and therefore the tenant could support the conclusion by even challenging the finding against him. It was held: “We may also mention here incidentally that so far as this case is concerned, the claim of bona fide need under S.11(3) and the protection under the second proviso thereto are interwined and are but different facets arising for consideration out of the same ground of eviction, and therefore irrespective of the question A.S. NO.706 OF 1999 :: 13 :: whether O.41, R.22 or the principles thereof applied or not, the tenants were entitled to challenge the finding of the Appellate Authority regarding the bonafides of the landlady in defence to the landlady's revision petition.” In Sainuddin vs. Sulaiman (2002 (3) KLT 224), the Supreme Court held that in a Revision preferred by the tenant, the landlord would be entitled to support the order of eviction by disputing the correctness of the finding recorded in the impugned order wherein availability of another ground for eviction was negatived. The Supreme Court held that a landlord who has succeeded in securing an order of eviction on one of the several grounds urged by him cannot be said to be a person aggrieved by such order. I am of the view that the above decisions would not support the contention raised by Sri.K.P.Sreekumar. 14. Rule 22 of Order XLI provides that any respondent, though he may not have appealed from any part of the decree, may not only support the decree but may also state that the finding against him in the Court below in respect of any issue ought to have been in his favour. The Rule also provides that the respondent may also take any cross objection to the decree which he could have A.S. NO.706 OF 1999 :: 14 :: taken by way of appeal. Explanation to Rule 22 reads thus: “Explanation:- A respondent aggrieved by a finding of the Court in the judgment on which the decree appealed against is based may, under this rule, file cross-objection in respect of the decree in so far as it is based on that finding, notwithstanding that by reason of the decision of the Court on any other finding which is sufficient for the decision of the suit, the decree, is, wholly or in part, in favour of that respondent.” An appeal is not maintainable against a finding. A person who has succeeded in the suit, but against whom the Court rendered certain findings, cannot file an appeal challenging those findings. He could file an appeal only if the ultimate decision is against him. A successful party cannot file an appeal challenging certain findings rendered by the Court against him. However, if the defeated party files an appeal, the opposite party may support the decree and at the same time, challenge a finding against him made by the court below. 15. In Superintending Engineer and others v. B.Subba Reddy (AIR 1999 SC 1747), it was held: “Respondent even though he has not appealed may support the decree on any other ground but if wants to modify it, he has to file cross objection to the A.S. NO.706 OF 1999 :: 15 :: decree which objection he could have taken earlier by filing an appeal.” 16. In Ravinder Kumar Sharma v. State of Assam and others (AIR 1999 SC 3571), the Supreme Court held: “We hold that the respondent-defendant in an appeal can, without filing cross-objections attack an adverse finding upon which a decree in part has been passed against the respondent, for the purpose sustaining the decree to the extent the lower Court had dismissed the suit against the defendants-respondents. The filing of cross-objection, after the 1976 Amendment is purely optional and not mandatory. ...... 23. The respondents before us are, therefore, entitled to contend that the finding of the High Court in regard to absence of reasonable and probable cause or malice – (upon which the decree for pecuniary damages in B and C Schedules was based) can be attacked by the respondents for the purpose of sustaining the decree of the High Court refusing to pass a decree for non-pecuniary damages as per the A Schedule. The filing of cross-objections against the adverse finding was not obligatory. There is no res judicata. ...” A.S. NO.706 OF 1999 :: 16 :: 17. The respondent in an appeal is entitled to support the judgment and decree passed by the trial court in his favour. The trial court would have arrived at several findings in the judgment – some in favour or against the plaintiff and some others in favour of or against the defendant. If the ultimate decision of the trial court is in favour of the defendant, he would have no right to file an appeal against the judgment and decree of the trial court. But in the appeal filed by the plaintiff against that decision, the respondent-defendant would be entitled to support the decision of the trial court and to challenge the correctness of the findings rendered by the trial court against him, in order to support the decision of the trial court. The respondent-defendant need not file a Memorandum of Cross Objection for that purpose. There may be cases where the finding on each issue may lead to the ultimate conclusion in the judgment. For example, in a suit for money based on promissory note, the trial court finds that the promissory note is genuine, that the defendant borrowed money from the plaintiff on the foot of the promissory note and that the amount was not repaid by the defendant. On another issue, the trial court finds that the defendant did not acknowledge the liability as alleged by the plaintiff and therefore the suit is barred by limitation. The net result would be dismissal of the suit. In the A.S. NO.706 OF 1999 :: 17 :: appeal filed by the plaintiff, the defendant-respondent may support the judgment by even challenging the finding of the trial court that the promissory note is genuine and that money is payable to the plaintiff. The respondent can do so without filing a Memorandum of Cross Objection, in view of Rule 22 of Order 41 of the Code of Civil Procedure. However, in view of the Explanation to sub-rule (1) of Rule 22 of Order 41, the respondent would be entitled to file a Memorandum of Cross Objection as well and it is only optional. 18. In the present case, there is a finding that the defendants committed breach in the matter of measurement of the property and in making available the encumbrance certificate and revenue receipts. However, the suit for specific performance was dismissed. The decree of the trial court is not based on the finding that the defendants committed breach as aforesaid. On the other hand, the court below dismissed the suit on the finding that the plaintiff failed to perform his part of the contract. In the appeal by the plaintiff, the respondents/defendants are entitled to support the decree and also challenge, even without filing any Memorandum of Cross Objection, the finding that they committed breach of the contract in respect of the aforesaid terms. It is not obligatory for the defendants to file a A.S. NO.706 OF 1999 :: 18 :: Memorandum of Cross Objection, since Rule 22 of Order XLI would enable him to support the decree and at the same time, state that the finding against him in respect of any issue should have been in his favour. Therefore, I reject the contention raised by the appellants that the defendants should have filed an appeal or Memorandum of Cross Objection challenging the finding in paragraph 7 of the judgment. 19. Sri.K.P.Sreekumar, learned counsel for the appellant contended that when the contract stipulates mutual obligations to be performed by the parties, the defendants are not entitled to complain of non performance of a later obligation by the plaintiff without the defendants performing their earlier obligations under the contract. The counsel relied on the decision in Vijaya Minerals Private Limited v. Bikash Chandra Deb.