GOPALAN S/O KAMAPALAN and AMBILI v SASIDHARAN S/O SIVARAMAN

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR.JUSTICE P.BHAVADASAN** **WEDNESDAY, THE 5TH DAY OF FEBRUARY 2014/16TH MAGHA, 1935** ## **RSA.No. 470 of 2012 ()** **----------------------AS.NO. 132/2010 OF ADDL.DISTRICT COURT-I, THIRUVANANTHAPURAM DATED 31-10-2011 -------------------------** **OS.NO. 515/2007 OF I ADDL.SUB COURT, THIRUVANANTHAPURAM DATED 10-12-2009** **----------------------------------------** ## **APPELLANT(S)/APPELLANTS/DEFENDANTS IN COUNTER CLAIM:** **-------------------------------------------------------------------------------------------------** **1. GOPALAN, S/O.KAMAPALAN, T.C.67/1357, PARAKOTTU, VELLAR, THIRUVANANTHAPURAM, PIN-695 012.** **2. AMBILI,** - **W/O.GOPALAN, T.C.67/1357, PARAKOTTU, VELLAR, THIRUVANANTHAPURAM, PIN-695 012.** **BY ADVS.SRI.MOHAN JACOB GEORGE** **SMT.P.V.PARVATHI** **SMT.REENA THOMAS** ## **RESPONDENT/RESPONDENT/PLAINTIFF IN COUNTER CLAIM :** **--------------------------------------------------------------------------------------------** **SASIDHARAN, S/O.SIVARAMAN,PARAKOOTTU VEEDU, VELLAR, THIRUVANANTHAPURAM.** ## **BY ADV. SRI.J.HARIKUMAR** **THIS REGULAR SECOND APPEAL HAVING BEEN FINALLY HEARD ON 30-01-2014, ALONG WITH RSA.NO. 489 OF 2012, THE COURT ON 05-02-2014 DELIVERED THE FOLLOWING:** **sts** ## **P.BHAVADASAN, J.** ## **-----------------------------------------Regular Second Appeal Nos.470 & 489 OF 2012 ------------------------------------------Dated this the 5[th] day of February, 2014.** ## **J U D G M E N T** Two suits namely, O.S.No.225/2006 and O.S.No.515/2007 and also a counter claim in O.S.No.515/2007 were jointly tried and disposed of by a common judgment dated 10.12.2009 by the Additional Sub Court, Thiruvananthapuram. The trial court, on appreciation of the evidence, dismissed O.S.No.515/2007 and allowed the counter claim in that suit. In O.S.No.225/2006, specific performance was denied by the trial court but a decree was granted enabling the plaintiffs in the suit to recover Rs.40,000/- with 9% interest from the date of the suit till the date of decree and thereafter with 6% interest till realisation. 2. R.S.A No.470/2012 is directed against the counter claim in O.S.No.515/2007 whereby the trial court directed the plaintiffs to vacate the premises in question and put the defendant in possession of the property within three months of the decree. R.S.A No.489/2012 is directed against the judgment and decree **R.S.A Nos.470 & 489/2012** **2** in O.S.No.225/2006 and against that portion of the decree which declined specific performance. 3. As facts are common and common issues arise for consideration, these appeals are being disposed of by a common judgment. 4. The plaintiffs in both the suits rely on Ext.A1 agreement by which the defendant had agreed to sell an extent of 5 cents of land for a total consideration of Rs.1,50,000/-. Rs.40,000/- was paid as advance on the date of agreement itself. The plaintiffs would allege that they were put in possession of the building in the property in pursuance to the agreement and the time for execution of the sale deed was eight months from the date of the agreement. The plaintiffs allege that in violation of the agreement namely, Ext.A1, the defendant sold 2.50 cents of property to another person for a very high amount and thus committed violation of the contract. The plaintiffs pointed out that they were always ready and willing to perform their part of contract and they have been contacting the defendant frequently demanding execution of the sale deed. Whatever that be, **R.S.A Nos.470 & 489/2012** **3** according to the plaintiffs, now that only an extent of 2 and odd cents remain with the defendant and they are willing to purchase the same with proportionate reduction price. On the basis of these allegations, they laid the suit for specific performance. Apprehending that they may be dispossessed forcibly from the house in the plaint schedule property, they filed O.S.No.515/2007. 5. Both the suits were resisted by the defendant. He accepted the agreement but pointed out that the extent intended to be assigned was not 5 cents but far less than that. Further, it was contended that he was always ready and willing to perform his part of contract and it was the plaintiffs who had committed breach. He pointed out that he had to sell the property for the marriage of his daughter and therefore, time is the essence of contract. He also pointed out that after the period of agreement, he had approached the plaintiffs for some more amount for the marriage of his daughter but the plaintiffs promised that they would pay the entire consideration within the period stipulated in the agreement. Nothing transpired thereafter and the defendant **R.S.A Nos.470 & 489/2012** **4** sold 2.5 cents of property to another person. He further pointed out that long after the period of agreement is over, with ulterior motive and raising false allegations, the plaintiffs caused to issue Ext.A2 notice dated 09.05.2005. Without waiting for a reply, suit was laid on 10.05.2005. The defendant pointed out that he has sent a reply containing the true facts and at no point of time he was unwilling to execute the document as alleged by the plaintiffs. He also disputed that the plaintiffs were put in possession of the property in pursuance to the agreement. 6. According to the defendant, after the agreement was entered into, the plaintiffs sought permission to reside in the building and the said permission was granted and that was only on licence. Contending that breach was on the part of the plaintiffs, he pointed out that the plaintiffs are not entitled to get specific performance. However, he has expressed his readiness and willingness to return the sum of Rs.40,000/- received by him with reasonable interest. 7. In the suit in which the plaintiffs prayed for relief against forcible eviction by the defendant, the defendant filed a counter **R.S.A Nos.470 & 489/2012** **5** claim pointing out that the plaintiffs were only licencees in the house and the licence has been terminated and they are bound to hand over the possession of the building. 8. The trial court raised necessary issues for consideration. The evidence consists of the testimony of PW1 and the documents marked as Exts.A1 to A5 from the side of the plaintiffs. The defendant examined himself as DW1 and had DW2 also examined. He had Exts.B1 to B4 marked. Ext.C1 is the commission report. 9. On an analysis of the evidence in the case, the trial court came to the conclusion that there is want of evidence to show that the plaintiffs were ready and willing to perform their part of contract throughout and therefore, their claim for specific performance has necessarily to fail. Further it was held that they are entitled to refund of the advance amount paid by them. As regards the other suit namely, O.S.No.515/2007, the trial court was of the view that it was only a permissive occupation by the plaintiffs and the permission has been terminated and they were bound to hand over the property to the defendant. Accordingly, **R.S.A Nos.470 & 489/2012** **6** while dismissing O.S.No.515/2007, the counter claim directing the plaintiffs to put the defendant in possession of the property was allowed. 10. Disappointed plaintiffs carried the matter in appeal and the appellate court confirmed the judgment and decree of the trial court. Hence these R.S.As. 11. At the time of admission of the R.S.As, the following substantial questions of law were framed: - “1. Are the courts below justified in granting recovery of possession to the respondent without considering the claim for the compensation for the improvements effected to the building by the plaintiff? 2. Shouldn't the court below bound to ascertain and find what exactly is the subject matter of the contract into which the parties to the said contract had entered? How this has been changed? And who is at fault?” 12. Learned counsel appearing for the appellants contended that both the courts below have misconstrued the pleadings and issues arising in the case and therefore, the findings are both factually and legally incorrect. It is quite evident, according to the learned counsel, that time is not the essence of contract for **R.S.A Nos.470 & 489/2012** **7** which there is no stipulation in Ext.A1 agreement. Attention was drawn to the fact that Ext.A1 agreement does not stipulate that if, within the period specified under Ext.A1, the plaintiffs fail to perform their part of contract, the advance amount paid by them will be forfeited. This is a clear indication of the fact that the time was not intended to be the essence of contract. Learned counsel further pointed out that after having entered into an agreement for sale of 5 cents of land with a clause that if the extent gets reduced due to acquisition for road, the balance extent only will be assigned, the defendant sold 2 and odd cents of property to another person and the said conduct of the defendant speaks the volume of intention and his oblique motive. It is contended that the plaintiffs were always ready and willing to perform their part of contract and they have adduced evidence to show that they had approached the defendant on several occasions demanding execution of sale deed but the defendant put it off under one pretext or another. 13. A reading of the evidence of DW1, according to the learned counsel for the appellants, will show that he has no **R.S.A Nos.470 & 489/2012** **8** regard for truth. The courts below were not justified in coming to the conclusion that the plaintiffs were in breach of the agreement. 14. Relying on the decision in _**Narinderjit Singh** vs._ _**North Star Estate Promoters Ltd.**_ (2012 KHC 4279), learned counsel for the appellants contended that escalation of price is not a ground to decline specific performance. Relying on the decision in _**Gangabai and others** vs._ _**Srinivasa Rao**_ (AIR 1971 Andhra Pradesh 293), it is pointed out that as time was not the essence of contract, relief of specific performance could not have been declined to the plaintiffs. Relying also on the decision in _**John Thomas and others** vs._ _**Joseph Thomas and others**_ (AIR 2000 Kerala 408), learned counsel went on to contend that the mere fact that notice calling upon the defendant to execute sale deed was issued two years after the date of execution of agreement was over does not ipso facto means that specific performance should be declined to the plaintiffs. Accordingly, it is contended that the judgment and decrees of the courts below cannot stand. **R.S.A Nos.470 & 489/2012** **9** 15. Learned counsel appearing for the respondent in these appeals reminded this Court that this Court is sitting in jurisdiction under Section 100 of Code of Civil Procedure and the scope of interference is considerably limited. Two courts have concurrently found that there is no evidence to show that the plaintiffs were ready and willing to perform their part of contract and that finding, being a finding of fact, cannot be interfered with by this Court in Second Appeal, it is contended. Learned counsel went on to point out that the plea that time is not the essence of contract cannot be countenanced because going by the testimony of DW1, it is evident that the property was being sold to raise funds for the marriage of his daughter and that was absolutely an essential need. It is also pointed out that after the agreement had been entered into, the defendant had approached the plaintiffs for some more amount towards sale consideration which the plaintiffs refused and pointed out that they would get the sale deed executed before the expiry of the stipulated period. Learned counsel went on to point out that except for saying that there were oral demands, the first written demand comes in the **R.S.A Nos.470 & 489/2012** **10** form of Ext.A2 dated 09.05.2005 and without even waiting for a reply, suit was immediately laid. It is significant to notice, according to the learned counsel, that the so called notice was issued long after the expiry of the period contained in Ext.A1 document. Contending that the courts below have properly appreciated the evidence on record and no grounds are made out to interfere with the same, learned counsel prayed for dismissal of the appeals. 16. That the parties have entered into an agreement for sale evidenced by Ext.A1 dated 01.10.2002 is not in dispute. It is also not disputed that a sum of Rs.40,000/- was paid as advance out of the sale consideration of Rs.1,50,000/- and the deed has to be executed on or before the expiry of eight months from the date of agreement. There is some controversy regarding the actual extent of property that was agreed to be conveyed under Ext.A1 document. The plaintiffs would say that on a reading of Ext.A1 document, it would be clear that the understanding was that if after the agreement for sale, any portion of the property was acquired by the Government, the **R.S.A Nos.470 & 489/2012 11** balance extent of property only will be assigned. The defendant, on the other hand, would contend that there was never an agreement to sell 5 cents of property and the agreement was to sell only a lesser extent of property. A reading of Ext.A1 shows that the claim of the defendant cannot be accepted. Ext.A1 clearly states that the extent of the property that is sought to be conveyed is 5 cents and in case there is any reduction in extent, that may be caused due to the formation of a road. It is also not in dispute that the defendant had sold 2.50 cents out of the 5 cents to a stranger. The contention of the defendant is that the sale was after the period agreed to in Ext.A1 and since there was no indication from the side of the plaintiffs that they are ready and willing to raise necessary funds to perform their part of contract, the defendant had no other option but to sell a portion of the property. There is nothing to show that before the issue of Ext.A2 dated 09.05.2005, any communication has been issued either by the plaintiffs or by the defendants calling up the other to perform his part of contract. **R.S.A Nos.470 & 489/2012** **12** 17. Here, one contention has to be noticed. The plaintiffs have a case that in furtherance to Ext.A1 agreement, they were put in possession of the house in the property. Even though the plaintiffs would characterise that possession as one in pursuance to the agreement, both the courts below, on analysis of the evidence, have come to the conclusion that it could not have been so and the plaintiffs would have occupied the premises only as licencees. 18. The above finding of the courts below seems to be justified. If, as a matter of fact, there was any intention to put the proposed building in possession, nothing prevented the parties from doing so. It would appear that after the agreement was entered into, on a request made by the plaintiffs, the defendant granted permission to them to reside. 19. It is an accepted fact now that only 2 and odd cents of property was remaining with the defendant and the balance extent has been sold by him to another person. The appellants would say that before the sale was effected by the defendant, they were not put on notice and referring to the evidence of **R.S.A Nos.470 & 489/2012** **13** DW1, it is pointed out that he had accepted that he had stated in court that a stranger who bought the property from the defendant had seen the agreement of sale between the plaintiffs and the defendant. Further contention is that going by Ext.A1, reduction in extent of property could have been caused only by using the property for the purpose of formation of a road. No acquisition for widening of the road has been effected to enable the defendant to show that as of now only a lesser extent is available for sale. 20. Of course, there are inconsistent versions by the defendant who examined as DW1 regarding the circumstances under which he happened to sell 2.50 cents of property and also regarding the price. But, how far that can help the plaintiffs is a different question. A reading of Ext.A1 shows that the same was executed in respect of 5 cents of property with a safety clause that if due to any reason, the property was to be surrendered, handed over or assigned for the purpose of widening of a road, only lesser extent will be assigned. Admittedly, the term for expiry of the document of sale fixed by the respective parties was **R.S.A Nos.470 & 489/2012 14** eight months from the date of the agreement. Both sides say that each of them had approached the other demanding execution of the sale deed, and the defendant says that he had demanded the balance amount. 21. On scanning through the evidence, there is nothing to show that the plaintiffs were ready and willing to perform their part of contract. Their assertion that the defendant had put off the execution of sale deed under one pretext or another cannot be accepted. It is significant to notice that PW1 admits that he had occasion to see a stranger inter-meddling that portion of the property and that was long ago. Even that did not persuade the plaintiffs to find out what had transpired and seek necessary reliefs thereafter. 22. It is found from the records that the plaintiffs for the first time addressed the defendant calling upon him to satisfy the conditions contained in Ext.A1 and execute assignment deed. Even though the plaintiffs would say that on previous occasions, they had demanded the defendant to receive the balance amount and execute the sale deed, there is no evidence regarding the **R.S.A Nos.470 & 489/2012** **15** said aspect except for the testimony of PW1. Therefore, the claim made by the plaintiffs that there were demands by them for execution of sale deed cannot be accepted. May be, time may not be the essence of contract in the case on hand. But, there is a probability that it could be so because as admitted by the plaintiffs, the defendant was in need of money to conduct the marriage of his daughter and also to close the loan in the Bank concerned. 23. It is true that the defendant had also not issued any notice or nor has he produced any document to show that he in fact had made a demand to the plaintiffs for execution of sale deed. The evidence shows that it was after the expiry of the period stipulated in Ext.A1 that the sale of the property to a stranger had been effected. As like the plaintiffs, it is difficult to accept that he had demanded the balance amount. But, one fact is clear that the defendant had asked the plaintiffs to give him some more money which the plaintiffs did not have. According to the plaintiffs, they hoped that the sale as such would be carried out immediately. Merely because time is stipulated in the **R.S.A Nos.470 & 489/2012** **16** agreement, it is well settled that time may not be the essence of the contract. If, in such cases, time is not treated as essence of contract, the current law is that it shall be specifically mentioned in the instrument itself. Admittedly, there is no such clause in the agreement Ext.A1. 24. It is significant to notice that the plaintiffs did not offer to deposit the amount in the Bank or such other place at the time of filing of the suit. There is no explanation offered by the plaintiffs as to why they sent Ext.A2 notice only in 2005 when the period for execution of sale deed was over in 2003. 25. In a suit for specific performance, the burden is on the plaintiffs to show that they were always ready and willing to perform their part of contract. The mere assertion on that behalf may not be sufficient. There will have to be some evidence to show that what the plaintiffs in such cases claimed is true. 26. The courts below have noticed all the above facts and found that the plaintiffs are not entitled to specific performance. It is also found by the lower court that the claim that there is an attempt on the part of the plaintiffs to take shelter under **R.S.A Nos.470 & 489/2012** **17** Section 53 of the Transfer of Property Act must fail. Those findings are unassailable. 27. Even though the defendant had sold 2 and odd cents against the terms of Ext.A1, the evidence of PW1 shows that he came to know about the sale soon after the deed was executed. One fails to understand then as to what made the plaintiffs wait till 09.05.2005 to issue an Advocate's notice. It, therefore, could not be said that the courts below were wrong in their conclusions. 28. But, the courts below have omitted to note one significant aspect. The plaintiffs had paid Rs.40,000/- as advance amount and that was till being retained by the defendant. They have also produced some evidence to show that they had made modifications and constructions in the plaint schedule property. Even after coming to know about the sale by the defendant in favour of a stranger, the plaintiffs expressed their willingness to purchase the balance extent of property in proportionate reduction price. Both the courts below found that such a claim cannot be entertained. While it could not be said that the courts below were wrong in their conclusion, one aspect looms large. **R.S.A Nos.470 & 489/2012** **18** Admittedly, the plaintiffs and their family have been residing in the suit property from 2002 onwards. 12 years have elapsed now. The commission report namely, Ext.C1, to a certain extent, indicates that additional structures have been put up. The defendant has no case that the additional structures so found was put up by him. 29. While it may not be possible to accept the claim of the plaintiffs that they were ready and willing to perform their part of contract and it was at defendant's fault that the sale deed could not have been executed, the fact that they are residing in the building for a long time and they have no other shelter to go must receive consideration. The fact that the defendant sold a portion of the property indicates that he was not very keen to retain the property. This is further fortified by the fact that he had allowed the plaintiffs to occupy the building in the premises soon after the execution of Ext.A1 agreement. Be that as it may, whether as licencees or not, the plaintiffs were in possession of the property from 2002 onwards. It is true that prices were escalated in the locality. Now the suit property has direct road **R.S.A Nos.470 & 489/2012 19** access also. However, on equitable grounds, it is felt that there needs to be some modification of the decree passed by the courts below. In the result, the judgment and decrees of the courts below are set aside and it is held that if the plaintiffs pay a sum of Rs.3,50,000/- (Rupees Three Lakhs Fifty Thousand only) in addition to Rs.40,000/- (Rupees Forty Thousand only) already paid by them as evidenced by Ext.A1 agreement within a period of three months from the date of this judgment, the defendant shall execute sale deed in respect of the property left behind after sale by him in favour of the plaintiffs. If the plaintiffs fail to comply with the above portion of the decree, these appeals shall deem to have been dismissed and the decree passed by the trial court as confirmed in appeal shall stand. These appeals are disposed of as above. ## **P.BHAVADASAN JUDGE** smp