THE HON’BLE SRI JUSTICE N.R.L.NAGESWARA RAO CITY CIVIL COURT APPEAL No.282 OF 2004 JUDGMENT: The plaintiff in O.S.No.1164 of 1998 on the file of the II Senior Civil Judge, City Civil Courts, Hyderabad, is the appellant herein. 2. The suit was filed for specific performance of the contract. 3. The allegations in the plaint go to show that originally an agreement of sale was entered on 10.01.1987 by the 1st defendant for sale of the schedule property and the suit O.S.No.121 of 1991 on the file of II Senior Civil Judge, City Civil Courts, Hyderabad, was filed and when the suit was pending, a compromise was entered into on 24.06.1993. As per the terms of compromise, the plaintiff considering the request of defendant No.1 gave up all his rights in the said property. However, as per clause 4 of the said compromise, it was agreed between the parties that in case the 1st defendant intends to sell the property he shall offer to sell the suit property only to the plaintiff at Rs.3,25,000/- up to a period of four years and thereafter i.e., after the expiry of four years the plaintiff shall have first option subject to them prevailing market value. The suit was accordingly disposed of as per the said terms. While so, on 21.11.1996 the plaintiff received a caveat and from the contents of it, a Registered Power of Attorney was executed by the 1st defendant in favour of a Mangilal Thoshniwal on 23.09.1993 and the said property was mortgaged with the 2nd defendant in order to circumvent the compromise the said power of attorney was created and clandestinely the mortgage transaction was entered into to defeat the rights of the plaintiff. Therefore, on 23.06.1998 the plaintiff issued a notice to the 1st defendant to execute a sale deed for consideration of Rs.3,25,000/- within a period of ten days from the date of receipt of the notice. As the 1st defendant has not co-operated, the suit was filed for specific performance of the contract. 4. The defendants filed a written statement denying most of the allegations in the plaint. It was pleaded that the conditions in the alleged compromise were entered into after receiving the sum of Rs.1,25,000/- as against the sum of Rs.1,00,000/- referred therein. Subsequently, the plaintiff came forward to waive the terms of the compromise provided in additional sum of Rs.1,00,000/- was paid. Accordingly, a sum of Rs.1,00,000/- was paid under four different cheque pay orders, which was realised by the plaintiff. The 1st defendant is not at all intending to sell the property and therefore, the clause 4 of the compromise cannot be enforced. The 1st defendant after obtaining the sum of Rs.3,00,000/- has executed a mortgage deed in favour of the 2nd defendant on 23.09.1993 and that it is not an attempt to defeat the rights of the plaintiff. Further-more, from time to time another some other amounts were received to a tune of Rs.7,80,000/-. There is no restriction on the right of the 1st defendant to create a charge or borrow the money even though original transaction was a money transaction and the plaintiff was satisfied with receiving the money. The compromise was on 24.06.1993 and the present suit is filed in October, 1998 beyond a period of four years and the plaintiff never intended to purchase the property. The suit is therefore liable to be dismissed. 5. On behalf of the above pleadings, the following issues have been framed for trial: 1) Whether the plaintiff is entitled for the relief of specific performance of agreement of sale as well as possession of the suit property as prayed for? 2) Whether the plaintiff is always ready to perform his part of contract? 3) To what relief? 6. On behalf of the plaintiff PW.1 was examined and marked Exs.A.1 to A.6. On behalf of the defendants DW.1 was examined and marked Exs.B.1 to B.9. 7. After considering the evidence on record, the learned II Senior Civil Judge, City Civil Courts, Hyderabad, dismissed the suit of the plaintiff. Aggrieved by the said judgment, the present appeal is filed. 8. The points that arise for consideration are: 1) Whether the plaintiff is entitled for the specific performance of the compromise? 2) Whether the judgment and decree passed by the learned II Senior Civil Judge, City Civil Courts, Hyderabad, is legal and sustainable? 9. POINTS: There is no dispute about the fact that originally an agreement of sale was entered into on 10.01.1987 and a sum of Rs.1,00,000/- was paid as advance and on the basis of it, the suit O.S.No.121 of 1991 was filed and subsequently it was compromised and the compromise memorandum is Ex.A.1. Clause 4 is as follows: “4. That, the defendant shall offer to sell the suit property to the plaintiff, in case the defendant intend to do so, within a period of FOUR years from the date of this compromise, the plaintiff shall be entitled to purchase the suit property for total consideration of Rs.3,25,000/- by exercising his first option and thereafter, after a period of FOUR years, the plaintiff shall have first option subject the the then prevailing market value”. 10. It is not in dispute that under the said compromise a sum of Rs.1,00,000/- was paid, which was received under the earlier agreement. From the above terms, it is quite clear that the parties contemplated in case if the property sold within four years the defendant shall have priority to purchase for the consideration of Rs.3,25,000/- and if it is beyond four years, it shall be based on the market value. Therefore, in order to enforce the liability the plaintiff has to show that there was an intention to sell by the 1st defendant within the period of four years. According to him, the caveat Ex.A.5 was received where-under he came to know about the G.P.A., and also the mortgage and therefore, he felt that the 1st defendant is intending to dispose of the property. As can be seen from the Ex.A.5, the G.P.A. holder has only lodged the caveat to the effect that the plaintiff is trying to interfere with the possession and enjoyment of the property. Evidently, this caveat was filed on 15.11.1996. It does not disclose any intention on the part of the 1st defendant to sell the property. Even after the receipt of this caveat Ex.A.5, the plaintiff has not issued any notice doubting the acts of the 1st defendant and in fact for the first time, the notice has emanated under Ex.A.3 dated 23.06.1998. For which, the reply Ex.A.4 was given on 27.06.1998. Therefore, the legal notice Ex.A.4 was also given five years after the compromise. Even in this also only the issue of the G.P.A. was questioned but no allegation was made that in order to defeat the rights of the plaintiff any attempt was made to create charge over the properties by executing fictitious documents or any other documents giving priority. Therefore, from this material, it is quite clear that the suit was filed beyond the period of four years and the right of the plaintiff to seek specific performance of the contract shall be on the payment of market value of the land and not on the fixed value of Rs.3,25,000/-, which can be only within a period of four years. It is the evidence of the 1st defendant as DW.1 that after the compromise a sum of Rs.1,00,000/- was paid under four cheques, which were received by the plaintiff and the plaintiff gave a declaration on 30.06.1993 referring two pay orders. The said declaration Ex.B.1 shows that the clause 4 was waived on receipt of Rs.50,000/- under two pay orders and the 1st defendant was authorised to sell the property. This declaration is evidently few days after the alleged compromise. In cross-examination, he admitted to have received the pay orders 569694 and 569695 dated 14.06.1993, which were referred in Ex.B.2. 11. The learned counsel for the appellant strongly contends relying upon a decision reported in Kalyan Singh Chouhan Vs. C.P. Joshi[1] and Syed Mahmood V. Dr. Manik Chandra[2] , that the non-framing of the proper issues with regard to the waiver of the contract has prejudiced the right of the appellant and the judgment has to be set aside and the matter has to be remanded. The non-framing of the issues has not prejudice the case of the plaintiff. On the other hand, it is for the plaintiff to show the readiness and willingness to perform the contract and to abide by the terms of the contract and not choose convenient term. Issues framed are not comprehensive to decide all the controversies. 12. In this case, even assuming to be that the plea of waiver is not true as contended by the 1st defendant, the question that was decided by the Court is basically on the term of clause No.4. Though the plaintiff tried to contend that the alleged mortgage in favour of the 2nd defendant is an attempt to defeat the rights of the plaintiff, there is nothing on record to show that the said transaction is a falsity. His evidence is only that the power of attorney holder has created the mortgage deed. The said document was not produced. Even when the 1st defendant was cross-examined tested that the market value of the property on the date was Rs.80,00,000/- and he has also stated that he received the consideration under the mortgage. It is a mortgage with possession and the 2nd defendant is in possession of the property. He also stated that further sum of Rs.4,80,000/- was received subsequently. In fact, when the 1st defendant was cross- examined, it was not even suggested that the mortgage is a sale transaction and not a loan transaction. The passing of the consideration is also not disputed. Therefore, merely because the power of attorney was given to sell the property or to create a charge, it does not mean that it was with a malafide intention. The material on record clearly goes to show that the plaintiff was not willing to perform the part of the contract. As per the compromise term since even after the lapse of four years stipulated under the decree dated 24.06.1993 the plaintiff is only trying to insist for specific performance on payment of the fixed amount and not the mortgage value. The suit was not framed declaring an intention that the plaintiff is prepared to pay the market value and thereby, the plaintiff by his own showing lacks readiness and willingness to perform the contract and the obligations under the compromise. There is nothing on record to show that within the period of four years, the plaintiff intended to sell the property. Therefore, for all the above reasons, I feel that the suit of the plaintiff is not maintainable and it does not call for any interference. 13. Accordingly, the suit is dismissed with costs. ________________________ N.R.L.NAGESWARA RAO,J Date:05.07.2011 INL [1] 2011(1) SCLAE 718 [2] 1996 A I H C 1387