HON’BLE SRI JUSTICE N.R.L. NAGESWARA RAO APPEAL SUIT No.2232 OF 2001 AND TRANSFER APPEAL SUIT No.3467 OF 2003 COMMON JUDGMENT: Defendants 1 and 2 in O.S.No.291 of 1994 on the file of the Principal Senior Civil Judge, Kakinada are the appellants herein. The suit was one filed for specific performance of the contract. 2. The allegations in the plaint go to show that the schedule property, which is house property, is a self-acquired property of the 1st defendant and defendants 2 and 3 are his sons and have no interest, but they were also made to join as executants. 3. According to the case of the plaintiff, the 1st defendant borrowed a sum of Rs.45,000/- from Kakinada Co-operative Building Society and he did not pay the amount and fell in arrears and by 15.03.1990 a sum of Rs.44,500/- was due and the society intended to proceed against the property. In order to discharge the Society loan and to avert the proceedings by the society, the 1st defendant put up the southern portion in the said house for sale. Coming to know about the proposal of the 1st defendant to sell the property, the plaintiff agreed to purchase the property for a consideration of Rs.86,000/- and a sum of Rs.10,000/- was paid and an agreement was executed. The Society stopped the sale of the property as the 1st defendant paid that amount to the Society. Subsequently, on 21.03.1990 the 1st defendant received a sum of Rs.26,000/-. Under the terms of the agreement, the plaintiff has to discharge the balance of the sale consideration and the time for registration was formally fixed to 21.06.1990. The plaintiff made payments subsequently on different dates. After 04.06.1990 the plaintiff informed about the registration and willingness to perform the part of the contract and requested the 1st defendant to deliver the southern side portion of the property to him. The 1st defendant has delivered possession of the property and after performing the necessary Poojas, entered into the premises on 18.06.1990. The plaintiff made some improvements and the plaintiff has been demanding the 1st defendant to receive balance consideration of Rs.2,920/- and execute the sale deed. While the matter stood thus, the 1st defendant issued a notice on 10.12.1993 stating that the plaintiff is a tenant and demanded to deliver vacant possession of the property, for which a reply was given. Again, on 07.06.1994 another notice was given and the 1st defendant has filed the suit O.S.No.210 of 1994 for possession of the property and therefore, the present suit is filed for specific performance of the contract of sale or in the alternative to refund the amount paid with interest. 4. The 1st defendant filed a written statement, which was adopted by the 2nd defendant. According to the contention of the 1st defendant, in February, 1990 the plaintiff joined as a tenant of the premises on a monthly rent of Rs.500/-. The allegation that in order to discharge the debt, the 1st defendant wanted to sell the property and the plaintiff approached for the purchase is not true. There is no denial of the fact that on 15.03.1990 the agreement was executed for Rs.86,000/- and a sum of Rs.10,000/- was received. The subsequent payment of Rs.26,000/- on 21.03.1990 is disputed. Time is the essence of the contract and the loan amount has to be discharged by 21.06.1990. The 1st defendant is not aware of the particulars of the payments made by the plaintiff. The agreement of sale is not admissible. It was also further pleaded that the suit for specific performance is not maintainable as the land is an assigned land. The time being essence of the contract and as the claim is barred by time, the suit is to be dismissed. 5. The 3rd defendant filed a written statement claiming that he is not aware of the agreement of sale and he is not liable for the contract. 6. The plaintiff filed a rejoinder disputing the contentions raised by the 1st defendant and the plea of tenancy is also disputed. 7. On the basis of the above pleadings, the following necessary issues have been framed by the trial Court in O.S.No.291 of 1994, for trial: 1) Whether the time fixed in the suit agreement is fixed as an essential condition and whether time is essence of contract as contended by defendants? 2) What is the amount paid by the plaintiff towards advance? Is it Rs.36,000/- as contended by him or only Rs.10,000/- as contended by the defendants? 3) Whether the tenancy of the plaintiff continued after 18.06.1990? 4) Whether the plaintiff is in possession of the property in part-performance of the suit agreement as contended by him? 5) Whether the suit agreement is not valid and enforceable as contended by the defendants? 6) Whether the suit agreement is barred by time as alleged by the defendants? 7) Whether the plaintiff is always ready and willing to perform his part of the transaction? 8) Whether the plaintiff is entitled to seek specific performance of the suit agreement? 9) Whether amount has been paid by the plaintiff to the Land Mortgage Bank under the loan taken by the defendants? 10) Whether the plaintiff is entitled to seek the alternative relief, and if so, for what amount and against whom? 11) To what relief? 8. As referred in the above suit, O.S.No.210 of 1994 was filed by the 1st defendant contending that the plaintiff in O.S.No.291 of 1994 was a tenant of the premises from February, 1990 and he has fallen an arrears of rent to a tune of Rs.6,500/- and therefore, the suit is filed for eviction. The defendant, who was the plaintiff in O.S.No.291 of 1994, has repeated the contentions, which were raised in the suit O.S.No.291 of 1994. According to him, he was not a tenant of the premises and he is the purchaser of the property under the agreement of sale and subsequent to the agreement, he came into possession and therefore, there is no relationship of landlord and tenant and the suit for eviction is not maintainable. 9. On the basis of the above pleadings, the following issues are settled for trial in O.S.No.210 of 1994: 1) Whether the plaintiff is entitled for eviction as prayed for? 2) Whether the plaintiff is entitled for Rs.6,500/- as prayed for? 3) Whether the provision of A.P. Act 9 of 1977 do not apply to this case? 4) To what relief? 10. After framing necessary issues, both the suits were tried together and the evidence was recorded in O.S.No.291 of 1994. After considering the evidence on record, the suit O.S.No.291 of 1994 was decreed, whereas the suit O.S.No.210 of 1994 was dismissed. Aggrieved by the judgment and decree in O.S.No.291 of 1994, the appeal A.S.No.2232 of 2001 was filed and aggrieved by the judgment and decree of dismissal of O.S.No.210 of 1994 the appeal was filed before the District Court and it was transferred and numbered as Transfer A.S. 3467 of 2003. The parties are referred to as arrayed in O.S.No.291 of 1994. 11. The points that arise for consideration are: 1) Whether the plaintiff is entitled for the specific performance of the contract? 2) Whether the appellants are entitled for recovery of possession of the property? 3) Whether the judgment and decree passed by the learned Principal Senior Civil Judge, Kakinada, is legal and sustainable? 12. POINTS: The learned counsel for the appellant contended that the relief of specific performance ought not have been granted since the plaintiff has not performed the obligation and did not discharge debt by 21.06.1990 and consequently, there is a breach of contract. It is also his further contention that the theory of delivery of possession of property after Ex.A.1 is incorrect and in fact in February, 1990 the plaintiff was inducted into possession as a tenant and he continued to be so and therefore, he is liable to be evicted. It is also his contention that the property is inalienable and the contract is therefore not enforceable. 13. So far as the contention about the inalienable of the land is concerned, the land was assigned with certain conditions. There was an undertaking that a house should be constructed in the said property and in case of failure within one year, the assignment will be cancelled. Till this day, no action was taken for cancellation of the assignment and there is also no prohibition as such for cancellation of the assignment. Therefore, in view of the above circumstances, the appellants cannot defeat the agreement. 14. There is no dispute about the fact that the agreement was entered into under Ex.A.1 for sale of the schedule property for a sum of Rs.86,000/-. It is not very much material as to whether the plaintiff himself went and bargained or the plaintiff came to know about the intention to sell the property as he was indebted to the co-operative society. The fact remains that Ex.A.1 was executed by the 1st defendant along with his children and out of the sale consideration, it was specifically admitted by the 1st defendant that on the date of sale agreement Ex.A.1, he was paid a sum of Rs.26,000/- and a further sum of Rs.10,000/- was paid to the society and in his cross-examination he admitted that by the date of Ex.A.1, he received a sum of Rs.36,000/-. He also admitted that he spent the sum of Rs.26,000/- received by him for his family expenses. He also further admitted that as per the recitals in Ex.A.1, he has to still receive the balance of Rs.50,000/- and the plaintiff has to discharge the mortgage debt due to the society towards the house rent. As can be seen from Ex.A.1, it stipulates that the amount has to be discharged to the society by 21.06.1990 and the sale deed is to be obtained. Evidently, the contract did not stipulate the consequences on the failure of the plaintiff to pay the money to the society within that period. It is not in dispute that even though the entire balance amount of Rs.47,000/- and odd was not paid before 21.06.1990, it is clear that the plaintiff has paid the amount due to the society and only a balance of Rs.2,000/- and odd is payable under the agreement. The irregular payments, if any, by the plaintiff to the society has not caused any loss or damage to the appellants. In fact, the society has allowed the payment in such instalments. 15. It is to be noted that at no point of time, the society has demanded the appellants to pay the amount and at no point of time, the appellants have objected to the manner of payment of the amount due to the society. Therefore, it is futile for the appellants to argue that the plaintiff has not acted as per the terms of the contract. It is indisputable that the total consideration agreed under the agreement Ex.A.1 except sum of Rs.2,000/- and odd was paid by the plaintiff. The appellants allowed the payments to be made in instalments and their claim that without their knowledge the plaintiff paid the amount to the society is unbelievable. If there is no payment, naturally the society would have demanded the money from the appellants. But, in this case, such a thing did not happen. Therefore, the contention that the plaintiff being not ready and willing to perform the part of the contract cannot be accepted and as per the terms of the contract, he has discharged the debt to the society. Evidently, in cases of sale of immovable property, time is not generally treated as essence of the contract. If the appellants wanted to avoid the contract and terminate the same, the plaintiff has performed the contract, the appellants would not have kept quiet till 10.12.1993 when they gave the notice Ex.A.4 and another notice Ex.A.6 on 07.06.1994. This conduct of the appellants clearly goes to show that they have avoided the discharge of the total loan by the plaintiff and thereafter tried to avoid the obligation on the pretext of default by the plaintiff. The lower Court has considered these aspects and came to the right conclusion that the plaintiff was always ready and willing to perform the contract and the plaintiff is entitled for the equitable relief of specific performance. The question of limitation also does not arise since it is for the first time under Ex.A.4 the appellants have given a notice of cancellation of the contract. Till then, they were passively watching the payment of the money by the plaintiff and thereby keeping the contract subsisting. 16. The next question for consideration is whether the plaintiff was a tenant of the premises inducted in February, 1990 as claimed by the appellants or whether the appellants themselves have allowed to stay in the suit property after the execution of the contract and allowed the house-warming ceremony on 18.06.1990. According to the case of the appellants, even by the date of the agreement of sale, the plaintiff was a tenant. But this fact was not mentioned in the agreement of sale. If really the plaintiff was a tenant by that date, there would have been an understanding with regard to the mode of payment of the rents during the period of contract and the absence of such term in Ex.A.1 disproves the claim of the appellants. Further-more, in Exs.A.4 and Ex.A.6, it was not pleaded by the appellants that the plaintiff was a tenant from February, 1990. If really the tenancy has commenced from February, 1990 and the rents were paid continuously, there would have been some evidence to support the same. But, no document is filed and one fails to understand as to what was the reason for stoppage of the rents six months prior to the notice. The evidence of DW.2 on this aspect is also not convincing. His evidence is only goes to show that the plaintiff is a tenant of defendant No.1 and he had no personal knowledge about the agreement of sale. His evidence is only that when the defendants informed him about the default, he informed the plaintiff and the defendants to approach the Court of law. His evidence is also silent as to when the plaintiff joined the house of the appellants as a tenant. The fact that the possession of the plaintiff from June, 1990 is not disputed. The question is only as to whether the plaintiff came into possession as a tenant in February, 1990 or after the agreement in June, 1990. 17. The learned counsel for the appellants strongly contended that the evidence on record with regard to the performance of the house- warming ceremony and the performance of Pooja is not believable and the evidence of PWs.2 to 6 on this aspect is inconsistent. If once the theory of the appellants that the plaintiff was a tenant inducted into possession in February, 1990 is to be disbelieved, then the only alternative is to accept the plea of the plaintiff that after the agreement, as he had paid substantial money, he came into possession of the property. If really there was no consent of the appellants, the plaintiff would not have got into possession of the property. 18. The learned counsel for the appellants tried to contend that there are inconsistencies about the date on which the house-warming ceremony was performed and the invitation card was not originally filed, therefore, the claim of the plaintiff is to be rejected. I do not find any substance in the said contention and it is more probable that the plaintiff was allowed to occupy the premises since substantial amount has paid to the appellants and he continued to discharge the debts due to the society and it was his duty to pay the money to the society. Probably that might be the reason as to why the plaintiff has taken recourse to pay the amount due to the society in instalments rather than at one time. The appellants have not suffered any loss. The evidence of PWs.2 to 6 even if for a moment is not believed as sought to be canvassed by the learned counsel for the appellants still the theory of the appellants that the plaintiff was inducted into possession in February, 1990 having failed the only alternative is to accept the claim of the plaintiff. Merely because the original agreement did not stipulate the delivery of possession of the property before the execution of the sale deed, it does not mean that the parties cannot contract otherwise. Therefore, in view of the above circumstances, I do not find any merits in the appeals. Accordingly points are answered in favour of the plaintiff. 19. In the result, both the appeals are dismissed. Each party shall bear their own costs. _________________________ N.R.L. NAGESWARA RAO, J Date:03.08.2011 INL