IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 06.11.2009 CORAM THE HONOURABLE MR. JUSTICE P.R.SHIVAKUMAR A.S.No.1039 of 1996 & C.M.P.No.3538 of 2007 K.Sunthanthiram ... Appellant/Plaintiff -Vs- V.Murugesan ...Respondent/Defendant Appeal is filed under Section 96 of Civil Procedure Code against the judgment and decree dated 8.8.1996 made in O.S.No.907 of 1993 on the file of the Principal Subordinate Judge of Erode. For Appellant : Mr.S.Parthasarathy Senior Counsel for Ms.P.Bagyalakshmi For Respondent : Mr.V.K.Muthusamy Senior Counsel for Mr.Bharathidasan ------- JUDGMENT The plaintiff in the original suit is the appellant herein. The suit was filed by him on the basis of an agreement for sale dated 15.09.1988, to which the appellant and the defendant were the parties, for the relief of specific performance in the said contract. The learned trial Judge after trial, dismissed the suit holding the appellant/plaintiff not entitled to the relief of specific performance, by judgement and decree dated 08.08.1996. Aggrieved by the same and challenging the decree of the trial court dismissing the suit filed by the appellant herein, the present appeal has been preferred on various grounds set out in the memorandum of appeal. 2.The appellant had filed the suit before the trial court containing the following allegations. The suit property originally belonged to the respondent / defendant, who got it under a partition deed dated 19.02.1986 bearing https://hcservices.ecourts.gov.in/hcservices/ Document No.880 of 1986. He offered to sell the suit property measuring an extent of 2.08 acres to the appellant/plaintiff at the rate of 2,75,000/- per acre and the said offer was accepted by the appellant/plaintiff, pursuant to which both of them entered into a written agreement for sale dated 15.09.1998. On the date of the agreement itself, the appellant / plaintiff paid a sum of Rs.1,00,000/- as advance and part of the consideration. Though the agreement contains a recital that the transaction should be completed within a period of one year, the same was not the essence of the contract. In accordance with the said agreement for sale, four sale deeds covering an extent of 8,626 Sq.ft alone were executed by the respondent / defendant. Sale deed in respect of the balance extent remained to be executed. The appellant/plaintiff was ready and willing to perform his part of the contract and he had made his readiness and willingness to make payment of the balance consideration and get the sale deeds executed by the respondent / defendant, provided he could get encumbrance certificate and Income Tax clearance certificate known to the respondent/defendant. Despite repeated request made by the appellant / plaintiff, the respondent/defendant did not get Income Tax clearance certificate. On the other hand, the respondent / defendant chose to issue a telegram at the fag end of the period stipulated in the agreement, calling upon the appellant/plaintiff to make payment of the sale consideration and get the sale deed executed, as if he was ready to perform his part of the contract. The respondent / defendant also issued a lawyer's notice to that effect. A suitable reply was sent by the appellant / plaintiff, asking the respondent / defendant to get the Income Tax clearance certificate. Possession of the property, which was the subject matter of the agreement, was handed over to the appellant / plaintiff on the date of agreement itself, to enable him to form a lay out dividing the property into house sites and in fact, the appellant / plaintiff divided the properties into several house sites, out of which four plots alone were sold. While so, the respondent/defendant, who was not ready and willing to perform his part of the contract, made attempts to alienate and encumber the suit property in order to defeat the right of the appellant / plaintiff and also attempted to deposes the plaintiff/appellant, by driving him out of the suit property. Therefore, the appellant / plaintiff had to approach the Court by way of the suit for the relief of specific performance of contract directing the respondent / defendant to execute sale deed in respect of the suit 'B' Schedule property, after receiving the balance sale consideration and for permanent injunction restraining the respondent / defendant from interfering with the appellant's / plaintiff's peaceful possession and enjoyment of the suit property. 3.The suit was resisted by the respondent/defendant by filing a written statement, admitting the execution of agreement for sale dated 15.09.1988 and the receipt of a sum of Rs.1,00,000/- as advance and part consideration and denying the plaint allegations regarding https://hcservices.ecourts.gov.in/hcservices/ the plaintiff's / appellant's readiness and willingness to perform his part of the obligations under the agreement. The further contentions raised in the written statement are as follows:- It was specifically agreed by the parties to the agreement that the time stipulated in the agreement was the essence of the contract. The plaint allegations regarding induction of appellant / plaintiff in possession of the suit property in part performance of the contract is false. The appellant / plaintiff did not take any step to convert the property into house sites and hence there was no occasion for him to enter the property. The suit property continues to be an agricultural land and crops are being raised periodically by the respondent / defendant. It was the respondent / defendant, who was ever willing and ready to perform his part of the contract and on the other hand, the appellant / plaintiff was not ready and willing to perform his part of the contract as he could not arrange funds for the payment of the balance consideration. The plaint allegation that the sale could not take place, since the respondent / defendant had not obtained Income Tax clearance certificate is an utter false statement. The respondent / defendant who waited in vein till the end of the contract period, issued a telegram calling upon the appellant / plaintiff to come on 15.09.1989 with the balance sale consideration to take the sale deed from the respondent / defendant as per the agreement. After issuing such a telegram, the defendant in fact went to the Sub-registrar's office at Surampatti and waited there from morning till evening, but the appellant/plaintiff did not turn up. Therefore, the respondent/defendant issued a layer's notice fixing a dead line for payment of the balance consideration and to take the sale deed as per the agreement and thus making time for performance as the essence of the contract. The appellant/plaintiff, who received the said notice did not even respond. Thereafter, the appellant/plaintiff waited for three long years and filed the suit on 09.09.1992 affixing a Court fee of Rs.500/- alone, got the plaint returned on 14.09.1992, kept it in cold storage for more than 3 months and re-presented it on 04.01.1993, again with deficit Court fee, got it returned on 07.01.1993 and re- presented the same on 17.12.1993 with a delay of nearly one year. The said fact itself will show that the appellant/plaintiff did not have the necessary funds to pay the balance amount of sale consideration with a corollary that he was not ready and willing to perform his part of the contract from the date of agreement till the date of filing of the suit. Therefore, the appellant/plaintiff should be non-suited for the relief of specific performance sought for in the plaint. https://hcservices.ecourts.gov.in/hcservices/ 4.Based on the above said proceedings, the trial Court framed the following issues and additional issues: Issues: 1.Whether the plaintiff is entitled to the relief of specific performance as prayed for? 2.Whether the plaintiff was ready and willing to perform his part of the contract? 3.Whether the suit is barred by limitation? 4.To what relief? Additional Issue: 1.Whether the plaintiff is entitled to permanent injunction as prayed for? 5.PW1(the plaintiff) was the sole witness examined on the side of the plaintiff and Exs.A1 to A5 were the documents produced on his side. Similarly, DW1(defendant) was the sole witness examined on the side of the defendant and Exs.B1 to B17 were the documents marked on the side of the defendant. The report and plan of the Advocate Commissioner appointed by the trial court to make a spot inspection of the suit property, have been marked as Exs.C1 and C2. 6.On an appreciation of evidence adduced on both sides in the light of the arguments advanced on either side, the learned trial Judge came to the conclusion that the plaintiff was not ready and willing to perform his part of the contract under the suit agreement and hence he was not entitled to the relief of specific performance of the contract as prayed for in the plaint and thus decided the issue Nos.1 and 2 against the plaintiff and in favour of the defendant. So far as the issue No.3 is concerned, the Court below came to the conclusion that since the suit was filed within 3 years after the expiry of the period of one year stipulated in the agreement, the same was not barred by limitation. The additional issue No.1 was decided against the plaintiff holding that the plaintiff was not in possession of the suit property and hence he was not entitled to the relief of permanent injunction. Ultimately, the learned trial Judge, under issue No.4 came to the conclusion that the plaintiff was not entitled to any relief and accordingly dismissed the suit with cost by the judgment of the Court below dated 08.08.1996. The correctness of the said judgment and decree of the trial Court dated 08.08.1996 is questioned in this appeal by the appellant/plaintiff. 7.The suit being one for specific performance of contract under an agreement for sale of an immovable property, the appellant/plaintiff had not chosen to seek an alternative relief of refund of the advance amount with or without interest, in the event of the rejection of his plea for specific performance of the contract directing the respondent/defendant to execute the sale deed in terms of the agreement for sale. However, the appellant/plaintiff has chosen to file C.M.P.No.3538 of 2007 seeking permission of the Court, https://hcservices.ecourts.gov.in/hcservices/ to amend the plaint so as to direct the defendant to refund the advance amount with interest, in the event of rejection of his prayer for specific performance. The said petition has been resisted by the respondent / defendant on the ground of belatedness. It has also been resisted on the ground that the prayer for refund of the advance amount is barred by limitation. It has also been contended that the appellant/plaintiff has waived and abandoned the relief, prayer for which is sought to be incorporated in the plaint by way of amendment. 8.The points that arise for consideration in the appeal and the C.M.P are: 1.Whether the appellant/plaintiff has pleaded and proved that he was always ready and willing to perform his part of contract under the suit agreement for sale marked as Ex.A1? 2.Whether the appellant/plaintiff is entitled to the relief of specific performance as prayed for by him in the plaint? 3.Whether the appellant/plaintiff is entitled to the relief of permanent injunction? 4.Whether the appellant/plaintiff shall be permitted to amend the plaint to include the prayer for refund of advance amount with interest? 5.Whether the appellant/plaintiff is entitled to a decree directing the respondent / defendant to refund the advance amount with interest? 9.This Court heard the arguments advanced by Mr.Parthasarathy, learned senior counsel representing the counsel on record for the appellant and also Mr.V.K.Muthusamy, the learned senior counsel representing the counsel on record for the respondent. The materials records were also perused. 10.The unsuccessful plaintiff is the appellant herein. The suit was filed for specific performance and for permanent injunction based on an agreement for sale dated 15.09.1989. The said suit agreement has been produced on the side of the appellant/plaintiff and marked as Ex.A1. It is not in dispute that the parties to the suit entered into such agreement under the document marked as Ex.A1. The respondent / defendant admitted the execution of Ex.A1 agreement and receipt of a sum of Rs.1,00,000/- on the date of the agreement as advance and part consideration. On the other hand, the relief of specific performance sought by the appellant/plaintiff has been resisted by the respondent / defendant, on the ground that the appellant/plaintiff had not been ready and willing to perform his part of the contract, even though the respondent / defendant was ready and willing. Section 16(c) of the Specific Relief Act mandates that a plaintiff seeking the relief of specific performance shall specifically plead and prove that either he had performed his part of the obligations under the agreement or that he had been ready and willing to perform his part of the contract through out. But it should be kept in mind that the mere fact that the plaintiff has made https://hcservices.ecourts.gov.in/hcservices/ such a plea and is able to prove the same, will not make it mandatory on the part of the Court to grant the relief of specific performance, as the relief of specific performance is a discretionary relief and the Court is having a discretion, of course a discretion guided by legal principles, either to grant or not to grant such a relief. Section 20 of the Specific Relief Act enumerates the circumstances and grounds on which the discretion not to grant such relief can be exercised. Keeping the said principle in mind, let us now approach the issues involved in this case. 11.No doubt the appellant/ plaintiff has made a specific plea in his plaint to the effect that he was always ready and willing to perform his part of the contract under the Ex.A1 agreement of sale and that on the other hand, it was the respondent / defendant who was not ready and willing to perform his part of the contract. The said plaint averment has been emphatically denied by the respondent / defendant, who has contended that there was readiness and willingness on the part of the respondent / defendant and it was the appellant / plaintiff who lacked in such readiness and willingness. In the light of the said rival pleadings, we have to consider the evidence to find out whose plea can be sustained. 12.It is the case of the appellant / plaintiff that though a period of one year had been stipulated in Ex.A1 agreement for the completion of transaction, the said time could not be construed to be an essential condition of the contract. It is his further contention that though the time stipulated was not the essence of the contract, right from the date of agreement till the filing of the suit, he was ready and willing to perform his part of the contract. As the said contention is not admitted and on the other hand stoutly denied by the defendant, it is the duty of the appellant / plaintiff to prove the correctness of the said plea made by him. The only witness examined on the side of the appellant / plaintiff in order to prove his readiness and willingness was appellant / plaintiff himself. No independent witness was examined on his side. Apart from producing Ex.A1 agreement for sale, the plaintiff has also produced certified copies of the four sale deeds executed by the respondent / plaintiff covering a total extent of 8626 Sq.ft in favour of the nominees of the appellant / plaintiff in pursuance of suit agreement for sale. They have been marked as Exs.A2 to A5. It is the further contention of the appellant / plaintiff that after execution of the originals of Exs.A2 – A5, there arose a difficulty in getting further sale deed/deeds executed without the production of Income Tax clearance certificate; that hence he demanded production of Income Tax clearance certificate by the respondent / defendant and that despite several requests made by the appellant / plaintiff, the respondent / defendant failed to produce such Income Tax clearance certificate which resulted in the plaintiff's inability to get further sale deeds executed. Even though the appellant / plaintiff was ready and willing to perform his part of the contract by making payment of the https://hcservices.ecourts.gov.in/hcservices/ balance consideration and getting the sale deed executed in his name or in the name of his nominees, the appellant / plaintiff has contended, the non-production of Income Tax clearance certificate was an impediment for the completion of the sale transaction in accordance with Ex.A1 agreement. Except the ipsidixit of the plaintiff, who deposed as PW1, there is no other evidence either oral or documentary to prove that such a demand was made by him. Though the plaint contains an allegation that the appellant / plaintiff issued a reply to the lawyer's notice sent by the respondent / defendant, calling upon the respondent / defendant to get and produce Income Tax clearance certificate, there is not even a piece of paper to show that such a reply notice was sent. The copy of the notice issued by the respondent / defendant on 19.09.1989 has been marked as Ex.B1: Ex.B2 is the postal acknowledgment card evidencing service of the said notice on the appellant/plaintiff. 13.The receipt of telegram and the lawyer's notice issued by the respondent / defendant has been admitted by the appellant / plaintiff. At the same time, PW1 (plaintiff) in his evidence has not confirmed the plaint allegation to the effect that a reply notice was sent by him to the respondent / defendant calling upon him to produce Income Tax clearance certificate. On the other hand, there is a specific admission made by him to the effect that he did not issue any notice calling upon the respondent / defendant either to produce Income Tax clearance certificate or to execute sale deed. However, he had tried to introduce a new case in evidence, as if after receiving Ex.B1 notice, he met the respondent / defendant in person and demanded production of IT clearance certificate and execution of sale deed thereafter. It is highly improbable that the appellant/ plaintiff could have made such a demand. For getting an Income Tax clearance certificate, one should produce a draft sale deed along with the application for such certificate. The draft sale deed should have been prepared by the proposed purchaser. In Ex.B1 notice, the respondent / defendant had informed the appellant / plaintiff that the appellant / plaintiff was given a month's time for completing the sale transaction and directed him to prepare and send a draft sale deed to the respondent / defendant. Admittedly, the appellant / plaintiff did not prepare and send any draft sale deed to the respondent / defendant as demanded in Ex.B1 notice. Therefore, it is obvious that the appellant / plaintiff kept quiet even though the respondent / defendant had called upon the appellant / plaintiff to prepare and send the sale deed for proceeding with the sale. The non-production of the draft sale deed by the appellant / plaintiff as demanded by the respondent / defendant will make it clear that the present plea taken by the appellant / plaintiff that he could not complete the sale transaction because the respondent / defendant was not able to get and produce Income Tax clearance certificate is only a lame excuse put forth as a result of an after thought. PW1 has admitted that at the time of execution of sale deeds under the originals of Exs.A1 to A4, production of Income Tax clearance https://hcservices.ecourts.gov.in/hcservices/ certificate was not demanded and no difficulty was experienced in getting the said sale deeds registered and in getting back the registered documents from the Office of the Sub-Registrar. It was also admitted by the PW1 that he was informed at the time of registration of those sale deeds that no Income Tax clearance certificate was needed. Therefore, the present contention of the appellant / plaintiff that the non-production of Income Tax clearance certificate by the respondent / defendant was the reason for non- completion of the sale transaction cannot be sustained, as the said plea has been taken as an afterthought to explain why he was not ready to perform his part of the contract even after he was called upon by the respondent/defendant by issuing a telegram and a legal notice under Ex.B1. 14.Admittedly, the time for completion of transaction was fixed at one year as per the terms of the agreement Ex.A1. The agreement contains necessary recital to show that the parties intended that the transaction should be completed within a period of one year. It was recited therein that the appellant/plaintiff should make payment of the balance consideration and get the sale deed or sale deeds executed within the said period of one year, failing which the advance amount would be forfeited and his right to seek specific performance of the contract would be lost. It was also recited there in that in case the appellant/plaintiff was ready and the respondent/defendant was not ready, then the appellant/defendant could enforce the contract through Court and get the relief of specific performance, whereupon the respondent/defendant would be held liable for all the costs incurred by the appellant/plaintiff. Of course, these recitals are capable of suggesting that the parties intended that the transaction to be completed within a period of one year as stipulated in the agreement. But the same shall not be the conclusive proof of a consensus between the parties to make time for completion, the essence of the contract. 15.Admittedly, the agreement was entered into to enable the appellant/plaintiff to lay out the land into house sites and sell the house sites to the intending purchasers. Recitals are also found in Ex.A1 to the effect that possession of the land was handed over to the appellant/plaintiff to form a layout. When that is the case, we cannot come to the conclusion that the time for performance stipulated in the agreement was agreed to be the essence of the contract. If no time has been fixed in the agreement or if the time stipulated in the agreement has not been agreed to be essence of the contract, it does not mean that a party to the agreement cannot make it the essence of the contract, by stipulating a reasonable time for performance. In this regard, admittedly at the fag end of the period stipulated in the agreement, the respondent/defendant issued a telegram calling upon the appellant/plaintiff to come to the Sub- Registrar's office on 15.09.1989 and get the sale deed executed after making payment of the balance sale consideration. As the https://hcservices.ecourts.gov.in/hcservices/ appellant/plaintiff did not turn up, the respondent / defendant chose to issue a notice on 15.09.1989 calling upon the appellant/plaintiff to send the draft sale deed within a week and get the sale deed registered within a month from the date of receipt of the notice and informing him that in case of failure, the sale agreement dated 15.09.2009 would stand terminated. By issuing such a notice, the respondent/defendant had conveyed a clear message to the appellant/plaintiff that he wanted the time granted by him in the legal notice was to be treated as an essential condition of the contract. Therefore, it has to be concluded that though the time originally stipulated in Ex.A1 agreement was not intended to be the essence of the contract, the respondent/defendant by issuing Ex.B1 notice, the receipt of which has been acknowledged under Ex.B2, has made it abundantly clear that the time was the essence of the contract and that the failure to complete the transaction by the time stipulated in the notice would cause termination of the agreement. Therefore, the contention of the respondent/defendant that on that score alone, the relief sought by the appellant/plaintiff for specific performance of contract has got to be countenanced. 16.Even assuming that the issue of Ex.B1 notice would not have made time stipulated therein as the essence of contract, unless the appellant/plaintiff is able to prove that he was ready and willing to perform his part of the contract right from the date of agreement till the filing of the suit and even during the pendency of the suit, he shall