B. SANTOSHAMMA & ANR. versus D. SARALA & ANR.
[2020] 11 S.C.R. 1, Supreme Court of India, 2020
Outcome: Dismissed (Dismissed)
Segment: Body
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[2020] 11 S.C.R. 1
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 B. SANTOSHAMMA & ANR.
v.
D. SARALA & ANR.
(Civil Appeal No. 3574 of 2009 Etc.)
SEPTEMBER 18, 2020
[UDAY UMESH LALIT AND INDIRA BANERJEE, JJ.]
Specific Performance:
Agreement for sale of suit land (300 sq. yards) – Between
appellant-vendor and respondent-vendee – For a total consideration
of Rs. 75,000/- – Rs. 45000/- out of the total consideration paid to
the vendor – Total consideration was required to be paid within 45
days from the date of agreement – Subsequent to the agreement
vendor executed a registered deed of conveyance in favour of ‘P’
in respect of 100 sq. yards out of the suit land – Suit for specific
performance by vendee – Plea of vendor that the agreement was
subject to the condition that the vendor would negotiate with ‘P’ to
get his earlier agreement with the vendor cancelled – ‘P’ was initially
not impleaded in the suit for specific performance – However, was
impleaded after expiry of limitation period – Another suit by vendee
against ‘P’ seeking declaration of agreement between vendor and
‘P’ as null and void, without impleading the vendor – Suit by ‘P’
seeking perpetual injunction against the vendee – Trial court
decreed the suit for specific performance in part, holding that the
vendee was entitled to only 200 sq. yards of the suit land and not to
the 100 sq. yards which was covered by the sale deed in favour of
‘P’ – Vendee’s suit against ‘P’ was dismissed for non-joinder of the
vendor – Ascertaining the sale
consideration for 200 sq. yards to
be Rs. 50,000/- and in view that Rs. 45000/- had already been paid
to the vendor, the Court directed the vendee to pay the balance Rs.
5000/- within a stipulated time and in default, the suit was to be
dismissed – Appeal by vendor as well as the vendee – High Court
confirmed the judgment of trial court – Appeal to Supreme Court –
Held: Vendee was always ready and willing to perform and had
performed the obligations under the agreement – The vendor failed
to discharge the onus to prove that the agreement was subject to the
condition that the vendee would negotiate with ‘P’ – Vendor having
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accepted major part of consideration, cannot contend that the
agreement could not have been enforced in respect of 200 sq. yards
in favour of the vendee – The suit for specific performance against
‘P’ having been barred by limitation and the suit for declaration
having been dismissed for non-joinder of vendor, rights of ‘P’ over
100 sq. yard cannot be nullified – The orders of courts below do
not call for any interference.
Specific Relief Act, 1963:
s.10 (as amended w.e.f. 01-10-2018) and ss. 11(2), 14 and
16 – Specific performance in respect of contracts – Nature of –
Held: After amendment of s. 10, relief of specific  performance of a
contract is no longer discretionary – The Court is obliged to enforce
the same, subject to the provisions of ss. 11(2), 14 and 16.
s.12 – Specific performance of part of contract – Permissibility
– Held: Ordinarily the Court enforces a contract in its entirety –
But, the Court may, u/s. 12 direct the defaulting party to perform so
much part of the contract as can be performed.
Party:
Necessary party – A transferee, to whom the subject matter
of a sale agreement or part thereof is transferred, is a necessary
party to a suit for specific performance – In a suit for declaring a
document as null and void, the executant of the document in question
is a necessary party.
Pleading:
Plea of bar under Order II rule 2 CPC – Held: Is a technical
plea, which has to be pleaded and satisfactorily
established – On
failure to raise such plea, court not to decide the plea suo moto –
Code of Civil Procedure, 1908 – Order II rule 2.
Suit:
Clubbing of suits – Purpose and effect of – Held: Clubbing
of suits is for the sake of convenience i.e. to save time, costs,
repetition of procedures and to avoid conflicting judgments – Such
clubbing does not convert the suits into one action – The suits retain
their separate identity.
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Dismissing the appeals, the Court
HELD: 1.1 The finding of the trial court, affirmed by the
High Court that the vendee was ready and willing to perform her
obligations under the agreement dated 21.3.1984, which is based
on evidence and supported by cogent reasons, is unexceptionable.
[Para 57][20-D-E]
1.2 The vendee paid Rs.40,000/- out of the total
consideration of Rs.75,000/- on the date of execution of the
agreement dated 21.3.1984 itself. It is not disputed that the
Vendee paid a further Rs.5,000/- to the Vendor’s husband against
a receipt. It is the vendor’s own case that in terms of the agreement
dated 21.3.1984, the full consideration was to be paid within 45
days. The vendee’s claim that she tendered Rs.30,000/- on
30.4.1984 was not disputed by the vendor in her legal notice/
letter dated 20.6.1984. In any case the vendee obtained Demand
Draft dated 4.5.1984 for Rs.30,000/- in favour of the vendor
towards balance consideration, within 47 days from the execution
of the agreement dated 21.3.1984. Time is not of essence to
agreements for sale of immovable property, unless the agreement
specifically and expressly incorporates the consequence of
cancellation of the agreement, upon failure to comply with a term
within the stipulated date. The concurrent findings of the High
Court and the trial court that the vendee was ready and willing to
perform and had performed her obligations under the agreement
dated 21.3.1984, are based on evidence and sound
reasons and
hence do not call for interference of this Court. [Paras 60 and
61][21-E-H; 22-A-C]
2.1 The plea of the vendor, that the agreement dated
21.3.1984 was subject to the condition that the vendee would get
the earlier agreement between the vendor and ‘P’ cancelled,
cannot be accepted for the reasons that (i) the agreement dated
21.3.1984, which is in writing does not incorporate any such
condition; (ii) that it is incredible that the vendor, who knew ‘P’
to whom she had agreed to sell 100 square yards of land, should
proceed on the basis of an alleged assurance of the vendee, that
‘P’ would relinquish his rights under the earlier agreement
between the vendor and ‘P’, without ascertaining from ‘P’ whether
he was actually ready to relinquish his rights under the said
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earlier agreement with her; (iii) that ‘P’ had denied knowledge of
the agreement between the vendor and the vendee; and that (iv)
within a month and a few days from the date of execution of the
agreement between the vendor and the vendee, after the vendee
tendered full consideration, the vendor executed a registered
deed of conveyance in favour of ‘P’ without any prior intimation
to the vendee, and without giving the vendee any opportunity to
persuade ‘P’ to abrogate his earlier agreement with the vendor.
[Para 58][20-E-G; 21-A-B]
2.2 The onus of proof lies on the party who makes an
allegation. It was for the vendor to establish that the agreement
dated 21.3.1984 was subject to the condition as alleged by the
vendor, that the vendee and/or her husband would negotiate with
‘P’ to get his earlier agreement with the vendor cancelled. The
vendor failed to discharge her onus of proving that there was
such a condition in the agreement dated 21.3.1984. The trial court
and the High Court rightly did not believe the vendor.
[Para 59][21-C-D]
3. It is true that the trial court had directed the vendee to
pay the balance of Rs.5,000/- on or before 15.4.1994, failing which
the suit for specific performance would stand dismissed. However,
any time granted by the Court at its discretion, can always be
extended by the Court. In any case, the vendor had filed an appeal
against the decree in the suit for specific performance. The
vendee, who had been litigating for about 10 years by April, 1994
and had already paid Rs.45,000/- over 10 years ago, but not got
the suit land, could not be expected to put in more money, until
the decree assumed finality. Since there was an appeal of the
vendor pending, the failure of the vendee to put in Rs.5,000/-
within the time stipulated by Court, wold not, in itself, disentitle
the vendee to the relief of specific performance. It was for the
Court to decide whether or not to extend the time for payment of
Rs.5,000/-. The appellate court rightly expressed its discretion
in favour of the vendee. [Paras 62, 63 and 64][22-C-F]
4.1 The relief of specific performance of an agreement, was
at all material times, equitable, discretionary relief, governed by
the provisions of the Specific Relief Act 1963. Even though the
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power of the Court to direct specific performance of an agreement
may have been discretionary, such power could not be arbitrary.
The discretion had necessarily to be exercised in accordance
with sound and reasonable judicial principles. [Para 67][23-B-C]
4.2 Relief of specific performance of a contract is no longer
discretionary, after the amendment of s. 10 of Specific Relief Act.
After the amendment of Section 10, the Court is obliged to enforce
the specific performance of a contract, subject to the provisions
of sub-section (2) of Section 11, Section 14 and Section 16 of the
Act. [Para 70][24-B-C]
5.1 An agreement to sell immovable property, generally
creates a right in personam in favour of the vendee. The vendee
acquires a legitimate right to enforce specific performance of the
agreement. The Court ordinarily enforces a contract in its entirety
by passing a decree for its specific performance. However, Section
12 of the Specific Relief Act carves out exceptions, where the
Court might direct specific performance of a contract in part.
[Paras 71 and 72][24-D-E]
5.2 Where a party to the contract is unable to perform the
whole of his part of the contract, the Court may, in the
circumstances mentioned in Section 12 of the S.R.A., direct the
specific performance of so much of the contract, as can be
performed, particularly where the value of the part of the contract
left unperformed would be small in proportion to the total value
of the contract and admits
of compensation. [Para 73][25-G-H;
26-A]
5.3 Section 12 of the Specific Relief Act is to be construed
and interpreted in a purposive and meaningful manner to empower
the Court to direct specific performance by the defaulting party,
of so much of the contract, as can be performed. To hold otherwise
would permit a party to a  contract for sale of land, to deliberately
frustrate the entire contract by transferring a part of the suit
property and creating third party interests over the same. A
contractee who frustrates a contract deliberately by his own
wrongful acts cannot be permitted to escape scot free.
[Paras 87 and 88][28-F-H]
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5.4 In the present case the vendee had apparently tendered
the full consideration within the time stipulated in the agreement
dated 21.3.1984, that is, within 45 days or if not 45, within 47/48
days from the date of its execution. However, the vendor
purported to sell 100 square yards of the suit land to ‘P’ by
executing a registered deed of conveyance in his favour. Since
title in respect of 100 square yards had passed to ‘P’ and the suit
for specific performance was barred by limitation, the trial court
was constrained to decree the suit for specific performance in
part, and direct that a Deed of Conveyance be executed in respect
of the balance 200 square yards of the suit land, under the
ownership and control of the vendor. [Paras 74, 76 and 86][26-B,
E; 28-E]
6.1 After having entered into an agreement for sale of 300
Sq. yards of land, with her eyes open, and accepted a major part
of the consideration (Rs.45,000/- out of Rs.75,000/-) it does not
lie in the mouth of the vendor to contend that the contract should
not have specifically been enforced in part, in respect of the
balance 200 sq. yards of the suit land which the vendor still owned.
It is patently obvious that the vendor did not disclose any earlier
agreement to the vendee, as the agreement in writing dated
21.3.1984, does not bear reference to any earlier agreement.
[Para 89][29-A-B]
6.2 Instead of awarding damages in respect of the part of
the contract
which could not be enforced and/or in other words
damages for breach of agreement to sell the entire suit land, the
trial court had reduced the total consideration by 1/3rd of the
agreed amount, in lieu of damages, as one third of the area agreed
to be sold to the vendee could not be sold to her. The total price
agreed upon being Rs.75,000/- for the entire suit land, comprising
300 square yards, the agreed price works out to Rs.25,000/- for
100 square yards and/or Rs.2,500/- per square yard. The trial
court very fairly reduced the consideration by Rs.25,000/-, being
the price of 100 square yards of land computed proportionally, in
lieu of damages. The vendor can have no legitimate reason to
complain. [Para 90][29-C-D]
7.1 A transferee to whom the subject matter of a sale
agreement or part thereof is transferred, is a necessary party to
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a suit for specific performance. The vendee omitted to implead
‘P’. By the time she filed an application to implead ‘P’ in 1989,
the suit for specific performance of the agreement dated 21.3.1984
had become barred by limitation as against ‘P’. [Para 79]
[26-H; 27-A]
7.2 Under the Limitation Act 1963 the period of limitation
for filing  a suit for specific performance is three years from the
date fixed for performance of the contract, or if no date is fixed,
then three years from the date on which the vendee is put to
notice of refusal to perform the agreement (Item No.54 in Part II
of the Schedule to the Limitation Act 1963). [Para 80][27-B]
7.3 The vendee was put to notice of the refusal of the vendor
to execute the agreement dated 21.3.1984, by the vendor’s letter/
legal notice dated 20.6.1984. Any suit for specific performance
would be time barred by June/July 1987. Moreover, it is a matter
of record that the vendee knew of the registered deed of
conveyance in favour of ‘P’, when she instituted the suit in 1984.
The vendee neither amended her pleadings in the plaint nor
amended the prayers. ‘P’ was simply added defendant. The Court
adding ‘P’ as defendant in the suit for specific performance, did
not make any direction in terms of the proviso to Section 21(1) of
the Limitation Act, that the suit against him be deemed to be
instituted at any earlier date. There could therefore be no question
of any relief against ‘P’ in the suit for specific performance.
[Paras 82, 83][27-F-H; 28-A]
7.4 The suit for specific performance being time barred
against ‘P’ and the suit against ‘P’ also having been dismissed
for non-joinder of the vendor,  there could be no question of
nullifying the rights that had accrued to ‘P’ pursuant to the Deed
of Conveyance dated 25.4.1984 executed by the vendor
transferring 100 sq. yards of the suit land to ‘P’. Moreover, there
was apparently an agreement in writing executed between the
vendor and ‘P’ on or about 25.01.1984 before execution of the
agreement between the vendor and the vendee. [Para 85]
[28-C-D]
Durga Prasad and Anr. v. Deep Chand and Ors. AIR
1954 SC 75 : [1954] SCR 360 – referred to.
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7.5 The vendee did not implead the vendor as defendant in
her later suit inter alia for a declaration that the Deed of
conveyance executed by the vendor in favour of ‘P’ was null and
void. The suit has rightly been dismissed for non-joinder of the
vendor as defendant. There could be no question of a document
being adjudged null and void without impleading the executant
of the document, as defendant. [Para 84][28-B]
8.1 Clubbing of suits for hearing them together and disposal
thereof by a common judgment and order is for practical reasons.
Such clubbing together of the suits do not convert the suits into
one action. The suits retain their separate identity. The clubbing
together is done for convenience, inter alia, to save time, costs,
repetition of procedures and to avoid conflicting judgments. [Para
91][29-E-F]
Mahalaxmi Coop. Housing Society Ltd. and Ors. v.
Ashabhai Atmaram Patel (D) thr. Lrs. and Ors. (2013)
4 SCC 404 : [2013] 6 SCR 1 – relied on.
8.2 It is not correct to say that the Court is under an
obligation to reject the subsequent suit, irrespective of whether
objection of bar under Order II Rule 2 of the CPC was raised or
not. The plea of bar under Order II Rule 2 of the CPC is a technical
plea which has to be pleaded and satisfactorily established. If the
plea of bar under Order II Rule 2 is not taken, the Court should
not suo motu decide the plea. The plea cannot be raised before
this Court if not raised
in the High Court. [Paras 92, 93][29-H;
30-A-B]
R. A. Oswal v. Deepak Jewellers and Ors. (1999) 6 SCC
40; Dalip Singh  v. Mehar Singh Rathee and Ors. (2004)
7 SCC 650 – relied on.
Case Law Reference
[1954] SCR 360
referred to
Para 43
[2013] 6 SCR 1
relied on
Para 91
(1999) 6 SCC 40
relied on
Para 93
(2004) 7 SCC 650
relied on
Para 93
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CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3574
of 2009.
From the Judgment and Order dated 07.09.2006 passed by the
High Court of Judicature of Andhra Pradesh at Hyderabad in AS No.
1785 of 1994.
With
C.A. Nos. 3575-3577 of 2009
K. Radhakrishnan, Sr. Adv., T. Bhaskar Gowtham, Abhijit
Sengupta, S. Thananjayan, Ms. Promila, Vinay Navare, Aman Shukla,
Vishal Arun, Advs. for the appearing parties.
The Judgment of the Court was delivered by
INDIRA BANERJEE, J.
1. These appeals are against a common judgment and order passed
by the High Court of Judicature of Andhra Pradesh at Hyderabad
dismissing the appeals being A.S. Nos.892 of 1994, 893 of 1994, 894 of
1994 and 1785 of 1994 and inter alia confirming the judgment and decree
of the Trial Court in O.S.No.20 of 1993 and OS No.  91 of 1993 and the
decree of dismissal by the Trial Court of the Suit being O.S.No.92 of
1993.
2. The Appellant No.1, in Civil Appeal No. 3574 of 2009, B.
Santoshamma, hereinafter referred to as the ‘Vendor’, wife of the
Appellant No.2 in the said appeal, B. Darshan Reddy, purchased 300
square yards of land, in survey No. 262 of Hayathnagar Village and
Taluk in Ranga Reddy District, hereinafter referred to as the ‘suit land’,
from one D. Tanesha, under a registered sale deed dated 20th August,
1982.
3. After about ten days, the Vendor allegedly entered into an oral
agreement with the proforma respondent in the said appeal, P. Pratap
Reddy, for sale of 100 sq. yards out of the suit land
in his favour, for a
total consideration of Rs.3000/-, out of which Rs.2,500/- was paid in
advance. The Vendor claims to have delivered possession of the said
100 sq. yards to Pratap Reddy on the date of the oral agreement itself.
4. On or about 20th January, 1984, the alleged oral agreement
between the Vendor and Pratap Reddy was allegedly reduced into
writing, upon payment of the balance consideration of Rs.500/-. The
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Vendor and her husband allegedly agreed to execute the sale deed on an
auspicious day, after consulting the family priest.
5. On 21st March, 1984, the Vendor entered into an agreement
with the contesting respondent in Civil Appeal No. 3574 of 2009, Smt D.
Sarala, hereinafter referred to as the Vendee, for sale of the suit land to
the Vendee, for a total consideration of Rs.75,000/-, out of which
Rs.40,000/- was paid by the Vendee to the Vendor in advance. The
Vendor claims to have informed the Vendee of the oral agreement with
Pratap Reddy, which had been reduced to writing on 20th January, 1984.
The Vendor and her husband Darshan Reddy contend that the Vendor
had also specifically informed the Vendee that the Vendor had received
the sale consideration for 100 sq. yards from Pratap Reddy, and had
delivered possession of 100 sq. yards of land to him.
6. The Vendor has alleged that she specifically requested the
Vendee to incorporate a clause with regard to the earlier agreement
with Pratap Reddy in the sale agreement between the Vendor and the
Vendee. However, the Vendee assured the Vendor that she would get
the earlier agreement with Pratap Reddy cancelled as her husband knew
Pratap Reddy well and had already spoken to Pratap Reddy. According
to the Vendor, the Vendee represented to the Vendor, that there was no
need for the Vendor to get any clearance from Pratap Reddy as the
Vendee and her husband had been assured
by Pratap Reddy that no
difficulty would be created by him.
7. On or about 25 May, 1984, that is, about two months after
execution of the sale agreement with the Vendee, the Vendor executed
a registered deed of conveyance transferring 100 sq. yards of the suit
land in favour of Pratap Reddy. The Vendor and her husband Darshan
Reddy, as also Pratap Reddy, have alleged that the Vendee had tried to
interfere with Pratap Reddy’s possession of 100 sq. yards of the suit
land.
8. On or about 20th June, 1984, the Vendor allegedly issued notice
to the Vendee contending that the agreement of sale dated 21st March,
1984 was conditional upon clearance from Pratap Reddy in view of the
earlier agreement of the Vendor with Pratap Reddy for sale of 100 sq.
yards of the suit. The purported notice, if any, was issued after execution
of the registered deed of conveyance, for sale of 100 sq. yards of the
suit land in favour of Pratap Reddy.
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9. On 22nd June, 1984, the Vendor’s husband, Darshan Reddy,
lodged a complaint with the Station House Officer, Hayathnagar, alleging
that the original sale deed of the suit land in favour of the Vendor in
respect of the suit land had been stolen from his residence, alongwith
other documents.
10. By a letter dated 28th June, 1984, the Vendee replied to the
notice, contending that the document had been handed over by the Vendor
to the Vendee. Sometime thereafter, the Vendee filed a suit being
O.S.No.222 of 1984 in the Court of the Principal Subordinate Judge,
Rangareddy District, for specific performance of the agreement of sale
dated 21st March, 1984. In the said suit, the Vendee, being the plaintiff,
claimed delivery of possession of 300 sq. yards of land from the Vendor.
Pratap Reddy was not impleaded defendant in the said suit for specific
performance of the Agreement dated 21.3.1984. Later the Vendee filed
an application being I.A.No.44 of 1989 for impleading Pratap Reddy,
pursuant to which an order dated 5th April, 1989 was passed whereby
Pratap Reddy was added as defendant No.3 in the said suit.
11. In the meanwhile, in 1985, Pratap Reddy filed a suit being
O.S.No.190 of 1985 in the court of the Principal District Munsif,
Hyderabad East and North, seeking a decree of perpetual injunction
restraining the Vendee from interfering with his possession over 100 sq.
yards of the suit land.
12. In the suit filed by Pratap Reddy, it was alleged that he was
not
aware of any agreement of sale between the Vendor and the Vendee
in respect of the suit land or of payment of Rs.40,000/- to the Vendee in
terms thereof.
13. It is the case of Pratap Reddy, that even if the Vendee had
entered into any agreement as alleged with the Vendor, there could be
no question of sale of 100 sq. yards of the suit land earlier agreed to be
sold to Pratap Reddy, and actually sold to Pratap Reddy by a registered
deed of conveyance dated 25.5.1984.
14. The Vendee also filed a suit being O.S.No.401 of 1985 against
Pratap Reddy in the Court of Principal District Munsif, Hyderabad for a
declaration that the agreement between the Vendor and Pratap Reddy
with regard to 100 sq. yards was null and void. The Vendor was not
impleaded as party to the said suit.
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[INDIRA BANERJEE, J.]
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15. On or about 19th July, 1989, the Vendor and her husband
Darshan Reddy filed their Written Statement in O.S.No.222 of 1984
subsequently renumbered as O.S.No.20 of 1993 being the suit for specific
performance of the sale agreement between the vendor and the Vendee,
which is hereinafter referred to as the suit for specific performance.
Pratap Reddy also filed his written statement in the suit for specific
performance. The three suits have, from time to time, been renumbered.
16. The suit for specific performance, which had been transferred
to the Additional District Court of  Rangareddy District and renumbered
O.S.No.20 of 1993, was clubbed for hearing along with  Suit No.190 of
1985, renumbered as O.S.No.91 of 1993 and O.S.No.702 of 1991
renumbered as O.S.No.92 of 1993.
17. The Trial Court framed the following issues in the suit being
O.S No.20/1993, that is the suit for specific performance:
“1. Whether the plaintiff (sic the Vendee) was put in possession
of the suit plot admeasuring 300 sq. yards?
2. Whether the suit agreement of sale was subject to the
clearance of any agreement of sale of 100 sq. yards out of
the suit plot in favour of one Sri. P. Pratap Reddy?
3. Whether the sale of 100 sq. yards out of the suit plot to Sri.
P. Pratap Reddy is true and binding on the plaintiff.(sic the
Vendee)
4. Whether the suit is bad for non-joinder of necessary
parties?
5. Whether the defendants (Sic the Vendor) committed
breach
of contract of sale?
6. Whether plaintiff is entitled to the specific performance of
the suit agreement of sale?
7. To what relief?”
An additional issue was framed as to whether 3rd defendant, that
is Pratap Reddy, was a bona fide purchaser of 100 square yards of the
suit land.
18. In O.S.No.91/1993, being the suit for injunction filed by Pratap
Reddy, the Trial Court framed the following issues:
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“1.Whether the plaintiff  (sic Pratap Reddy) is entitled to
perpetual injunction as prayed for?
2. To what relief?”
The following additional issue was also framed:
“Whether the plaintiff (sic Pratap Reddy) is entitled to the
declaration and possession sought?”
19. In Original Suit No.92 of 1993, being the suit for declaration,
filed by the Vendee against Pratap Reddy, the following issues were
framed:
“1. Whether the suit is bad for non-joinder of parties?
2. Whether the plaintiff (sic Vendee) is entitled to declaration
as prayed for?
3. Whether the defendants are entitled to exemplary costs of
Rs.3,000/-?
4. To what relief?”
20. By a common judgment and decree dated 30th March, 1994,
the learned District Judge, Rangareddy disposed of  all the three suits.
The suit for specific performance was allowed, in part, holding that the
Vendee, was not entitled to seek specific performance of the agreement
in respect of 100 sq. yards covered by the sale deed dated 25th May,
1984, but entitled to relief of specific performance in respect of the
remaining 200 sq. yards of the suit land. The Vendee’s suit for declaration
against Pratap Reddy was dismissed for non- joinder of the Vendor.
21. Since Exhibit A-1, being the sale agreement dated 21st March,
1984 between the Vendor and the Vendee showed that the sale
consideration for 300 sq. yards land was fixed at Rs.75,000, which meant
that the price fixed per sq. yard was Rs.250/-, the Court held that the
Vendee had to
pay Rs.50,000/- to the Vendor, towards sale consideration.
As the Vendee was found to have paid Rs.40,000/- under Ex.A1 and a
further Rs.5,000/- under the receipt being Ex.A3, the Trial Court
effectively held that the Vendee was liable to pay a further sum of
Rs.5,000/- to the Vendor. The Vendee was directed to deposit
Rs.5,000/- in Court towards the balance sale consideration payable by
her, on or before 15th April, 1994, whereupon the Vendor would have to
execute a sale deed in respect of 200 sq. yards from out of the suit land,
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in favour of the Vendee. In case of failure to deposit Rs.5,000/- in Court
within the time stipulated, the suit would stand dismissed.
22. Being aggrieved, by the judgment and order referred to above,
the Vendor filed an appeal in the High Court, against the judgment and
decree in the suit for specific performance being O.S. of 1993 which
was numbered as A.S. 1785 of 1994. The Vendee also filed three appeals
being A.S. No.892 of 1994 against the judgment and decree in O.S.No.91
of 1993, an appeal being A.S.No.893 of 1994 against the judgment and
decree in O.S.No.20 of 1993 and an appeal being A. S. No.894 of 1994
against the judgment and decree in O.S.No.92 of 1993.
23. By a common judgment and order dated 7th September 2006,
which is under appeal in this Court, the High Court inter alia dismissed
all the appeals that is A.S. Nos.892, 893, 894 filed by the Vendee and
A.S. No.1785 of 1994 filed by the Vendor and confirmed the judgment
passed by the Trial Court. While the appeal being C.A. No.3574 of 2009
has been filed by the Vendor, the three appeals being C.A. Nos.
3575-3577, have been filed by the Vendee.
24. Mr. Gowtham appearing on behalf of the appellant in C.A.
3574 of 2009 being the Vendor submitted that the agreement dated
21st March, 1984 between the Vendor and Vendee was liable to be
cancelled as the Vendee had defaulted in making payment of the balance
amount within the time stipulated in the said
agreement.
25. Mr. Gowtham argued that there was a clause in the agreement
dated 21.3.1984 executed by and between the Vendor and the Vendee,
in terms whereof the Vendor agreed to register the sale deed in favour
of the Vendee, within 45 days from the date of the said agreement,
subject to receipt of the full consideration amount within 4.5.1984.
Mr. Gowtham submitted that full payment was not made within the
aforesaid date. The appellants after waiting for 20 more days, executed
and registered a sale deed in favour of Pratap Reddy in respect of 100
square yards of land.
26. Mr. Gowtham argued that the sale agreement was conditional
upon cancellation of the prior agreement with Pratap Reddy. It was
argued that the Vendee, who knew of the pre-existing agreement
between the Vendor and Pratap Reddy, had assured the Vendor that she
and/or her husband had already spoken to Pratap Reddy, to get the
agreement between the Vendee and Pratap Reddy cancelled.
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27. Mr. Gowtham emphatically argued that the agreement dated
21.3.1984 was a composite agreement for sale of 300 sq. yards of land
for a lump sum consideration of Rs.75,000/-. Since it was not possible to
sell 300 sq. yards to the Vendee as per the sale agreement, the sale
agreement became infructuous and incapable of specific performance.
There was no scope for sale of 200 sq. yards of land at a reduced
consideration.
28. Mr. Gowtham argued that there could be no question of any
decree of specific performance of the agreement dated 21.3.1984 in
favour of the Vendee, in the absence of readiness and willingness on the
part of the Vendee to perform her obligations under the agreement.
29. The Vendor and her husband Darshan Reddy contended that
they had not refused to execute the registered sale deed as alleged. It
was the contesting respondent who had failed to bring about a settlement
with Pratap Reddy as agreed, and had also failed to pay the balance
consideration within the time stipulated in the agreement. Time being of
essence to the agreement, it could not be specifically enforced.
30. The Vendor and her husband Darshan Reddy also asserted
that the Vendee was also not ready to pay the balance sale consideration
and had sought further time for payment on the ground that he did not
have the money. The suit for specific performance was thus, not
maintainable. In any case, the agreement for sale of 300 sq. yards of
land to the Vendee was incapable of
performance, since the appellant
did not have 300 sq. yards of land.
31. The Vendor and her husband Darshan Reddy have categorically
denied that they had delivered possession of 300 sq. yards of land to the
Vendee. They have asserted that the Vendee had taken possession of
200 sq. yards of land, 100 sq. yards having been transferred to Pratap
Reddy.
32. Mr. Radhakrishnan appearing on behalf of the Vendee argued
that the Vendee should have been granted specific performance of the
agreement dated 21.3.1984 in its entirety. The Court should have set
aside the purported sale deed in respect of 100 sq. yards of land in
favour of Pratap Reddy and directed the Vendor to sell the entire suit
property comprising 300 sq. yards to the Vendee.
33. Mr. Radhakrishnan argued that the purported sale agreement
of the Vendor with Pratap Reddy was not genuine. It is difficult to believe
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that the Vendor would, within 11 days from purchase of 300 sq. yards of
land (the suit land), enter into an agreement for sale of 100 sq. yards out
of the suit land.
34. Mr. Radhakrishnan further argued that the execution and
registration of the sale deed in favour of Pratap Reddy in respect of 100
sq. yards of land, was in any case, subsequent to the Agreement dated
21.3.1984 between the Vendor and the Vendee.
35. Mr. Radhakrishnan emphatically argued that the agreement
dated 21.3.1984 was for sale by the Vendor, to the Vendee of 300 sq.
yards for a consideration of Rs.75,000/-, pursuant to which possession
of the entire 300 sq. yards of land was delivered to the Vendee. This
has, of course, been denied by the Vendor.
36. Refuting the contention advanced by the Vendor, of want of
readiness and willingness on the part of the Vendee, to perform her
obligations under the Agreement dated 21.3.1984, Mr. Radhakrishnan
further argued that, the fact that the Vendee had paid Rs.40,000/- to the
Vendor on the date of execution of the sale agreement itself, apart from
Rs.5,000/- which the Vendee had admittedly paid to Darshan Reddy
(husband of the Vendor), demolishes the contention of the Vendor.  These
payments towards part consideration were duly acknowledged.
37. Mr. Radhakrishnan pointed out that on 30.4.1984 the Vendee
approached the Vendor and her husband with the balance amount of
Rs.30,000/- and requested them to
register the sale deed, but the Vendor
and her husband refused to receive the amount and instead requested
the Vendee to make the payment by Demand Draft.
38. According to the Vendee, the Vendee obtained a Demand
Draft No.463961 dated 4.5.1984 for Rs.30,000/- from Canara Bank, but
the Vendor did not accept the same. On 25.5.1984 the Vendee issued a
legal notice. Receipt of the legal notice was duly acknowledged by the
Vendor and her husband.  A further legal notice was issued by the Vendee
on 12.8.1984. In the meanwhile, by a letter dated 20.6.1984 in reply to
the legal notice of 25.5.1984, the Vendor admitted receipt of
Rs.45,000/-, but claimed that the agreement was subject to the Vendee
securing the approval of Pratap Reddy, to end the earlier agreement
between the Vendor and Pratap Reddy, for transfer of 100 sq. yards of
land to Pratap Reddy.
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39. Mr. Radhakrishnan concluded his arguments with the
submission that the Vendee had not delayed performance of her
obligations under the agreement dated 21.3.1984. Within 30.4.1984 the
entire consideration was tendered but unfortunately not accepted by the
Vendor with ulterior intent of resiling from her obligations under the said
argument to transfer the suit property to the Vendee. By 4th May, 1984,
that is within 47 days from the date of the agreement dated 21.3.1984
the Vendee was ready with a Demand Draft for the balance Rs.30,000.
40. Mr. Navare appearing on behalf of Pratap Reddy submitted
that the Appeals are all liable to be dismissed. First of all, on the date on
which the Vendee filed the suit for specific performance of the agreement
against the Vendor and her husband, she was aware of the registered
sale deed executed by the Vendor in favour of Pratap Reddy, in respect
of 100 sq. yards of land. Yet the Vendee filed a suit against the Vendor
and her husband, for specific performance of the agreement in which
Pratap Reddy was not impleaded defendant. There was no challenge to
the sale deed in favour of Pratap Reddy.
41. Mr. Navare argued that the Vendee filed a second suit against
Pratap Reddy for a declaration that the sale deed executed by the Vendor
in his favour was void, without impleading the Vendor.
42. Mr. Navare pointed out that as late as on 5.4.1989, the Vendee
filed an application for impleading Pratap Reddy as defendant in her
suit
for specific performance filed in 1984. The Vendee only added Pratap
Reddy.  There was no amendment either in the pleadings or in the prayers.
The reliefs claimed by the Vendee in the suit for specific performance
were thus barred by limitation, as against Pratap Reddy in the absence
of any clarification by the Trial Court, as required under Section 21 of
the Limitation Act, 1963.
43. Mr. Navare further submitted that, there being no prayer against
Pratap Reddy in the suit for specific performance, Pratap Reddy would
not be bound to join the original owner, in execution of the deed of
conveyance in favour of the Vendee. In support of his submission Mr.
Navare cited Durga Prasad and Anr. v. Deep Chand and Ors.1.
44. Mr. Navare submitted that the Vendee chose not to challenge
the registered sale deed in favour of Pratap Reddy or to seek any relief
against Pratap Reddy in the Suit for Specific Performance. Failure to
1 AIR 1954 SC 75
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make any such prayer amounted to relinquishment of the claim to such
relief, in view of Order II Rule 2 of the Code of Civil Procedure (CPC).
45. Mr. Navare submitted that the second suit filed by the Vendee
is bad for non-joinder of the Vendor. A registered sale deed executed by
the Vendor cannot be declared void in her absence.
46. Mr. Navare concluded that the second suit was also hit by
Order II Rule 2, and was thus barred under the law. In any case, the
second suit filed by the Vendor was only for a declaration and there was
no prayer for any consequential relief. The second suit was thus hit by
Section 34 of the Specific Relief Act, 1963.
47. Mr. Navare finally referred to Section 50(1) of the Registration
Act, 1908 set out hereinbelow for convenience:
“(1) Every document of the kinds mentioned in clauses (a),
(b), (c), and (d) of section 17, sub-section (1), and clauses
(a) and (b) of section 18, shall, if duly registered, take effect
as regards the property comprised therein, against every
unregistered document relating to the same property, and not
being a decree or order, whether such unregistered document
be of the same nature as the registered document or not.”
48. Referring to Section 50, Mr. Navare argued that a registered
sale deed with respect to a property will take effect over any unregistered
document, with respect to the same property.
49. Mr. Navare submitted that Pratap Reddy had also filed a
suit
for declaration and possession being O.S. No.190/1985. All 3 suits were
clubbed together and heard together. However,
(i) consolidation of 3 suits does not convert 3 suits into one action.
(ii) Consolidation of suits is for practical reasons such as, saving
costs, time and efforts of the parties, convenience of the parties,
avoiding repetitive exercises in 3 suits and avoiding conflict of
judgment in the 3 suits. However, the 3 suits consolidated/
clubbed together retain their separate identity. In support of
his argument Mr. Navare cited Mahalaxmi Coop. Housing
Society Ltd. and Ors. v. Ashabhai Atmaram Patel (D) thr.
Lrs. and Ors.2.
2 (2013) 4 SCC 404 [41]
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50. Mr. Navare emphatically argued that the right which have
accrued to Pratap Reddy, as a result of defective suits filed by the Vendee,
cannot stand abrogated by consolidation of the suits. There is no provision
in the CPC which permits a party to be deprived of such accrued, right
because of defects in the suit.
51. Mr. Navare submitted that the bar of the second suit under
Order II Rule 2 of the CPC is not a defect of a technical nature. The
mandate of Order II Rule 2 requiring the Vendor to claim all reliefs in
respect of the same cause of action arising out of one suit, is a provision
of a substantive nature, and not of a technical nature. It is based on
legislative policy.
52. Mr. Navare argued that although, no objection of bar under
Order 2 Rule 2 of CPC was raised in the suit, by Pratap Reddy, that
does not make any difference for the following reasons:
(i)
Order II Rule 7 requires only objection as to mis-joinder of
causes of action, to be taken at the earliest opportunity,
before issues are settled, and otherwise such objection is
deemed to be waived.
(ii)
Similarly, Section 21 of the CPC specifically provides that,
any objection as to the place of suing must be raised at the
earliest opportunity, before issues are settled and the same
cannot be raised in Appellate or Original Court for the first
time.
(iii)
Legislature has specifically clarified the cases where the
raising of an objection is necessary. There is no provision in
the CPC with
respect to objection under Order II Rule 2.
The maxim “Expressum facitcessaretacitum” (Express
mention of one thing excludes the other) squarely applies
here.
(iv)
There is a bar of Law prescribed by Order II Rule 2 against
the second suit. It is a kind of bar contemplated under Order
VII Rule 11 (d). The power of the Court under Order VII
Rule 11(d) is in the following words “the Plaint shall be
rejected...” Thus, it casts an obligation on the Court to reject
the same. Irrespective of whether an objection is raised by
the defendant in the suit or not, the consequence must follow.
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53. Mr. Navare concluded that this Court might decline to invoke
jurisdiction under Article 136 of the Constitution, even if an impugned
order is illegal. This Court should certainly not invoke its jurisdiction
under Article 136 to reverse the judgment, thereby effectively validating
the second suit, although it is barred by Order II Rule 2 of CPC. The
Appeal should therefore be dismissed.
54. It is not in dispute that the Vendor agreed to sell the entire suit
land comprising 300 square yards to the Vendee for a consideration of
Rs.75,000/-. The agreement dated 21.3.1984 is admitted by the Vendor.
55. It is also not in dispute that the Vendee paid Rs.40,000/- to the
Vendor on the date of the agreement itself and also paid a sum of
Rs.5,000/- to the Vendor’s husband, which was duly acknowledged.
56. The defence of the Vendor that the Vendee was unable and/
or unwilling to perform her obligations under the agreement dated
21.3.1984 has been rejected by the Trial Court, as also the Appellate
Court, that is, the High Court.
57. The finding of the Trial Court, affirmed by the High Court that
the Vendee was ready and willing to perform her obligations under the
agreement dated 21.3.1984, which is based on evidence and supported
by cogent reasons, is unexceptionable as discussed hereinafter.
58. The contention of the Vendor, that the agreement dated
21.3.1984 was subject to the condition that the Vendee would get the
earlier
agreement between the Vendor and Pratap Reddy cancelled,
cannot be accepted for the following reasons:
(i)
The agreement dated 21.3.1984, which is in writing does
not incorporate any such condition.
(ii)
It is incredible that the Vendor, who knew Pratap Reddy, to
whom she had, as per her own assertion, agreed to sell 100
square yards of land, should proceed on the basis of an
alleged assurance of the Vendee, that Pratap Reddy would
relinquish his rights under the earlier agreement between
the Vendor and Pratap Reddy, without ascertaining from
Pratap Reddy, whether Pratap Reddy was actually ready
to relinquish his rights under the said  earlier agreement
with her.
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(iii)
Pratap Reddy has denied knowledge of the agreement
between the Vendor and the Vendee.
(iv)
Within a month and a few days from the date of execution
of the agreement between the Vendor and the Vendee, after
the Vendee tendered full consideration, the Vendor executed
a registered deed of conveyance in favour of Pratap Reddy,
without any prior intimation to the Vendee, and without giving
the Vendee any opportunity to persuade Pratap Reddy to
abrogate his earlier agreement with the Vendor.
59. It is well settled that the onus of proof lies on the party who
makes an allegation. It was for the Vendor to establish that the agreement
dated 21.3.1984 was subject to the condition as alleged by the Vendor,
that the Vendee and/or her husband would negotiate with Pratap Reddy
to get his earlier agreement with the Vendor cancelled. The Vendor
failed to discharge her onus of proving that there was such a condition in
the agreement dated 21.3.1984. The Trial Court and the High Court
rightly did not believe the Vendor.
60. The effective concurrent finding of the High Court and the
Trial Court, that the Vendee had been ready and willing to perform and
had in fact performed her obligations under the Agreement dated
21.3.1984, is also unexceptionable for the following reasons:
(i)
As observed above, the Vendee paid Rs.40,000/- out of the
total consideration of Rs.75,000/- on the date of execution
of the Agreement dated 21.3.1984 itself.
(ii)
It is not disputed that the
Vendee paid a further Rs.5,000/-
to the Vendor’s husband against a receipt.
(iii)
It is the Vendor’s own case that in terms of the Agreement
dated 21.3.1984, the full consideration was to be paid within
45 days.  The Vendee’s claim that she tendered Rs.30,000/
- on 30.4.1984 was not disputed by the Vendor in her legal
notice/letter dated 20.6.1984.
(iv)
In any case the Vendee obtained Demand Draft No.463961
dated 4.5.1984 for Rs.30,000/- in favour of the Vendor
towards balance consideration, within 47 days from the
execution of the Agreement dated 21.3.1984.
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(v)
It is well settled that time is not of essence to agreements
for sale of immovable property, unless the agreement
specifically and expressly incorporates the consequence of
cancellation of the agreement, upon failure to comply with
a term within the stipulated date.
61. The concurrent findings of the High Court and the Trial Court
that the Vendee was ready and willing to perform and had performed
her obligations under the Agreement dated 21.3.1984, which as observed
above, are based on evidence and sound reasons, do not call for
interference of this Court.
62. It is true that the Trial Court had directed the Vendor to pay
the balance of Rs.5,000/- on or before 15.4.1994, failing which the suit
for specific performance would stand dismissed. However, any time
granted by the Court at its discretion, can always be extended by the
Court.
63. In any case, the Vendor had filed an appeal against the decree
in the suit for specific performance. The Vendee, who had been litigating
for about 10 years by April, 1994 and had already paid Rs.45,000/- over
10 years ago, but not got the suit land, could not be expected to put in
more money, until the decree assumed finality, upon disposal of the appeal.
64. Since there was an appeal of the Vendor pending, the failure
of the Vendee to put in Rs.5,000/- within the time stipulated by Court,
wold not, in itself, disentitle the Vendee to the relief of specific
performance. It was for
the Court to decide whether or not to extend
the time for payment of Rs.5,000/-.  The Appellate Court rightly expressed
its discretion in favour of the Vendee.
65. The question is, whether as argued by Mr. Gowtham, the
High Court erred in affirming the common judgment of the Trial Court
under appeal before the High Court, whereby the Trial Court allowed
the suit for specific performance in part, holding that the Vendee was
entitled to relief of specific performance in respect of 200 square yards
of land covered by the Agreement dated 21.3.1984 (that is, less 100 sq.
yards sold to Pratap Reddy by a registered deed of conveyance dated
25.4.1984), at a reduced consideration of Rs.50,000/-, since the agreement
dated 21.3.1984 was a composite agreement for sale of 300 sq. yards of
land at a lump sum consideration of Rs.75,000/-.
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66. While Mr. Gowtham has argued that the Courts should not at
all have allowed specific performance of the Agreement dated 21.3.1984,
Mr. Radhakrishnan has argued that the conveyance in favour of Pratap
Reddy should have been adjudged and declared a nullity, and the suit for
specific performance allowed in full, by directing the execution and
registration of a Deed of Conveyance, in respect of the entire suit land.
67. The relief of specific performance of an agreement, was at
all material times, equitable, discretionary relief, governed by the
provisions of the Specific Relief Act 1963, hereinafter referred to as
S.R.A. Even though the power of the Court to direct specific performance
of an agreement may have been discretionary, such power could not be
arbitrary. The discretion had necessarily to be exercised in accordance
with sound and reasonable judicial principles.
68. Section 10 of the S.R.A. as it stood prior to its amendment
with effect from 1.10.2018 provided:-
“10. Cases in which specific performance of contract
enforceable.- Except as otherwise provided in this Chapter,
the specific performance of any contract may, in the discretion
of the court, be enforced-
(a) when there exists no standard for ascertaining actual
damage caused by the non-performance of the act
agreed to be done; or
(b) when the act agreed to be done is such that
compensation in money for its non-performance would
not afford adequate relief.
Explanation.- Unless and until the
contrary is proved, the
court shall presume-
(i)
that the breach of a contract to transfer immovable
property cannot be adequately relieved by compensation
in money; and
(ii) that the breach of a contract to transfer movable property
can be so relieved except in the following cases:-
(a) where the property is not an ordinary article of commerce,
or is of special value or interest to the plaintiff, or consists
of goods which are not easily obtainable in the market;
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(b) where the property is held by the defendant as the agent
or trustee of the plaintiff.”
69. After amendment with affect from 1.10.2018, Section 10 of
the S.R.A. provides:
10. Specific performance in respect of contracts.- The Specific
performance of a contract shall be enforced by the court
subject to the provisions contained in sub-section (2) of
section 11,  section 14 and section 16.
70. After the amendment of Section 10 of the S.R.A., the words
“specific performance of any contract may, in the discretion of the Court,
be enforced” have been substituted with the words “specific performance
of a contract shall be enforced subject to ...”. The Court is, now obliged
to enforce the specific performance of a contract, subject to the provisions
of sub-section (2) of Section 11, Section 14 and Section 16 of the S.R.A.
Relief of specific performance of a contract is no longer discretionary,
after the amendment.
71. An agreement to sell immovable property, generally creates a
right in personam in favour of the Vendee. The Vendee acquires a
legitimate right to enforce specific performance of the agreement.
72. It is well settled that the Court ordinarily enforces a contract
in its entirety by passing a decree for its specific performance. However,
Section 12 of the Specific Relief Act carves out exceptions, where the
Court might direct specific performance of a contract in part. Section 12
of the Specific Relief Act, 1963
is set out hereinbelow for convenience.
12. Specific performance of part of contract.-(1) Except as
otherwise hereinafter provided in this section the court shall
not direct the specific performance of a part of a contract.
(2) Where a party to a contract is unable to perform the whole
of his part of it, but the part which must be left unperformed
by only a small proportion to the whole in value and admits
of compensation in money, the court may, at the suit of either
party, direct the specific performance of so much of the
contract as can be performed, and award compensation in
money for the deficiency.
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(3) Where a party to a contract is unable to perform the whole
of his part of it, and the part which must be left unperformed
either-
(a) forms a considerable part of the whole, though
admitting of compensation in money; or
(b) does not admit of compensation in money,
he is not entitled to obtain a decree for specific performance;
but the court may, at the suit of other party, direct the party in
default to perform specifically so much of his part of the
contract as he can perform, if the other party-
(i)
in a case falling under clause (a), pays or has paid
the agreed consideration for the whole of the contract
reduced by the consideration for the part which must
be left unperformed and a case falling under clause
(b), [pays or had paid] the consideration for the whole
of the contract without any abatement; and
(ii) in either case, relinquishes all claims to the
performance of the remaining part of the contract and
all right to compensation, either for the deficiency or
for the loss or damage sustained by him through the
default of the defendant.
(4) When a part of a contract which, taken by itself, can and
ought to be specifically performed, stands on a separate and
independent footing from another part of the same contract
which cannot or ought not to be specifically performed, the
court may direct specific performance of the former part.
Explanation.- For the purposes of this section, a party to a
contract shall be deemed to be unable to perform the
whole
of his part of it if a portion of its subject matter existing at the
date of the contract has ceased to exist at the time of its
performance.
73. Where a party to the contract is unable to perform the whole
of his part of the contract, the Court may, in the circumstances mentioned
in Section 12 of the S.R.A., direct the specific performance of so much
of the contract, as can be performed, particularly where the value of the
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part of the contract left unperformed would be small in proportion to the
total value of the contract and admits of compensation.
74. The Court may, under Section 12 of the S.R.A. direct the
party in default to perform specifically, so much of his part of the contract,
as he can perform, provided the other party pays or has paid the
consideration for the whole of the contract, reduced by the consideration
for the part which must be left unperformed. In this case the Vendee
had apparently tendered the full consideration within the time stipulated
in the Agreement dated 21.3.1984, that is, within 45 days or if not 45,
within 47/48 days from the date of its execution.
75. As observed above, the Vendee admittedly paid Rs.40,000/-
from out of the total consideration of Rs.75,000/- on the date of execution
of the agreement, a further sum, of Rs.5,000/- sometime thereafter, which
was duly acknowledged and also offered to pay the balance
Rs.30,000/- within 30.4.1984 that is, within 45 days from the date of
execution of the contract, which the Vendor did not accept. A Demand
Draft for equivalent amount of Rs.30,000/- was obtained from Canara
Bank on 4.5.1984, that is the 47th day of the execution of  the agreement.
76. Admittedly, a major portion of the full consideration, that is,
Rs.45,000/- had already been paid by the Vendor to the Vendee and the
Vendor had been ready to and had offered to pay the entire balance
consideration to the Vendor. However, the Vendor purported to sell 100
square yards of the suit land to Pratap Reddy by executing a registered
deed of conveyance in his favour.
77. As argued by Mr. Navare, a registered deed of conveyance
takes effect, as regards the property comprised therein, against every
unregistered deed relating to the same property as provided in Section
50 of the Registration Act.
78. The Vendee claimed specific performance of the agreement
dated 21.3.1984 in its entirety, and sought execution and registration of a
deed of conveyance in respect of the entire suit land comprising 300
square yards, but without impleading Pratap Reddy to whom ownership
of 100 square yards of land had been transferred by a registered deed of
conveyance.
79. A transferee to whom the subject matter of a sale agreement
or part thereof is transferred, is a necessary party to a suit for specific
performance. Unfortunately, the Vendee omitted to implead Pratap
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Reddy. By the time she filed an application to implead Pratap Reddy, in
1989, the suit for specific performance of the agreement dated 21.3.1984
had become barred by limitation as against Pratap Reddy.
80. Under the Limitation Act 1963 the period of limitation for
filing  a suit for specific performance is three years from the date fixed
for performance of the contract, or if no date is fixed, then three years
from the date on which the Vendee is put to notice of refusal to perform
the agreement (Item No.54 in Part II of the Schedule to the Limitation
Act 1963).
81. Section 21 of the Limitation Act provides:
21. Effect of substituting or adding new plaintiff or defendant.-
(1) Where after the institution of a suit, a new plaintiff or,
defendant is substituted or added, the suit shall, as regards
him, be deemed to have been instituted when he was so made
a party:
Provided that where the court is satisfied that the
omission to include a new plaintiff or defendant was due to a
mistake made in good faith it may direct that the suit as regards
such plaintiff or defendant shall be deemed to have been
instituted on any earlier date.
(2) Nothing in sub-section (1) shall apply to a case
where a party is added or substituted owing to assignment or
devolution of any interest during the pendency of a suit or
where a plaintiff is made a defendant or a defendant is made
a plaintiff.
82. The Vendee was put to notice of the refusal of the Vendor to
execute the agreement
dated 21.3.1984, by the Vendor’s letter/legal
notice dated 20.6.1984. Any suit for specific performance would be time
barred by June/July 1987. Moreover, it is a matter of record that the
Vendee knew of the registered deed of conveyance in favour of Pratap
Reddy, when she instituted the suit in 1984.
83. The Vendee neither amended her pleadings in the plaint nor
amended the prayers. Pratap Reddy was simply added defendant. The
Court adding Pratap Reddy as defendant in the suit for specific
performance, did not make any direction in terms of the proviso to Section
21(1) of the Limitation Act, that the suit against Pratap Reddy be deemed
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to be instituted at any earlier date. There could therefore be no question
of any relief against Pratap Reddy in the suit for specific performance.
84. The Vendee did not implead the Vendor as defendant in her
later suit (Original Suit No.401 of 1985, renumbered Original Suit No.92
of 1993) inter alia for a declaration that the Deed of conveyance executed
by the Vendor in favour of Pratap Reddy was null and void. The suit has
rightly been dismissed for non joinder of the Vendor as defendant. There
could be no question of a document being adjudged null and void without
impleading the executant of the document, as defendant.
85. The suit for specific performance being time barred against
Pratap Reddy, and the suit against Pratap Reddy also having been
dismissed for non joinder of the Vendor, there could be no question of
nullifying the rights that had accrued to Pratap Reddy, pursuant to the
Deed of Conveyance dated 25.4.1984 executed by the Vendor
transferring 100 sq. yards of the suit land to Pratap Reddy. Moreover,
there was apparently an agreement in writing executed between the
Vendor and Pratap Reddy on or about 25.01.1984 before execution of
the agreement between the Vendor and the Vendee.
86. Since title in respect of 100 square yards had passed to Pratap
Reddy and the suit for specific performance was barred by limitation,
the Trial Court was constrained to decree the suit for specific performance
in part, and
direct that a Deed of Conveyance be executed in respect of
the balance 200 square yards of the suit land, under the ownership and
control of the Vendor.
87. Section 12 of the SRA is to be construed and interpreted in a
purposive and meaningful manner to empower the Court to direct specific
performance by the defaulting party, of so much of the contract, as can
be performed, in a case like this. To hold otherwise would permit a party
to a  contract for sale of land, to deliberately frustrate the entire contract
by transferring a part of the suit property and creating third party interests
over the same.
88. Section 12 has to be construed in a liberal, purposive manner
that is fair and promotes justice. A contractee who frustrates a contract
deliberately by his own wrongful acts cannot be permitted to escape
scot free.
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89. After having entered into an agreement for sale of 300 Sq.
yards of land, with her eyes open, and accepted a major part of the
consideration (Rs.45,000/- out of Rs.75,000/-) it does not lie in the mouth
of the Vendor to contend that the contract should not have specifically
been enforced in part, in respect of the balance 200 sq. yards meters of
the suit land which the Vendor still owned. It is patently obvious that the
Vendor did not disclose any earlier agreement to the Vendee, as discussed
above. The agreement in writing dated 21.3.1984, does not bear reference
to any earlier agreement, as noted above.
90. Instead of awarding damages in respect of the part of the
contract which could not be enforced and/or in other words damages
for breach of agreement to sell the entire suit land, the Trial Court reduced
the total consideration by 1/3rd of the agreed amount, in lieu of damages,
as one third of the area agreed to be sold to the Vendee could not be sold
to her. The total price agreed upon being Rs.75,000/- for the entire suit
land, comprising 300 square yards, the agreed price works out to
Rs.25,000/- for 100 square yards and/or Rs.2,500/- per square yard.
The Trial Court very fairly reduced the consideration by Rs.25,000/-,
being the price of 100 square yards of land computed proportionally, in
lieu of damages. The Vendor can have no legitimate reason to complain.
91. Since we have upheld the dismissal of Suit No.92/1993 filed
by the Appellant
against Pratap Reddy, it is not really necessary to go
into the question of whether the said suit was barred under Order II
Rule 2 of the Civil Procedure Code as contended by Mr. Navare. It is
true that, the clubbing of suits for hearing them together and disposal
thereof by a common judgment and order is for practical reasons. Such
clubbing together of the suits do not convert the suits into one action as
argued by Mr. Navare. The suits retain their separate identity as held in
Mahalaxmi Coop. Housing Society Ltd. and Ors. v. Ashabhai
Atmaram Patel (supra). The clubbing together is done for convenience,
inter alia, to save time, costs, repetition of procedures and to avoid
conflicting judgments.
92. We are, however, unable to agree with Mr. Navare’s argument
that the Court is under an obligation to reject the subsequent suit,
irrespective of whether objection of bar under Order II Rule 2 of the
CPC was raised or not.
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93. The plea of bar under Order II Rule 2 of the CPC is a technical
plea which has to be pleaded and satisfactorily established.  In R. A.
Oswal v. Deepak Jewellers and Ors.3, this Court held that if the plea
of bar under Order II Rule 2 is not taken, the Court should not suo moto
decide the plea. Moreover, in Dalip Singh v. Mehar Singh Rathee
and Ors.4, this Court held that the plea cannot be raised before this
Court if not raised in the High Court.
94. We find no such infirmity in the judgment and order of the
High Court under appeal, confirming the judgment and order of the Trial
Court, that calls for interference of this Court. The High Court has rightly
dismissed the appeals from the judgment of the Trial Court.
95. These appeals are, therefore, dismissed.
Kalpana K. Tripathy
Appeals dismissed.
3 (1999) 6 SCC 40 [42]
4 (2004) 7 SCC 650