P. MEENAKSHISUNDARAM versus P. VIJAYAKUMAR & ANR. on 28 March 2018

[2018] 6 S.C.R. 667

P. MEENAKSHISUNDARAM

v.

P. VIJAYAKUMAR & ANR.

(Civil Appeal Nos. 3353-3354 of 2018)

MARCH 28, 2018

[R. BANUMATHI AND UDAY UMESH LALIT, JJ.]

Specific performance: Appellant had mortgaged the suitproperty with a bank and the bank had initiated recoveryproceedings – Meanwhile, appellant entered into a sale agreementto sell the suit property to respondent no.1 and pursuant thereto,respondent no.1 made some payments also – Thereafter, disputearose between the parties and respondent no.1 filed suit forspecific performance – Trial Court held in favour of respondentno.1 and directed appellant to execute sale deed – High Courtdismissed the appeals holding that appellant had not disclosed aboutthe existence of encumbrance which came to the knowledge ofrespondent no.1 subsequently and that there was readiness andwillingness on the part of respondent no.1 – On appeal, held: Theunderstanding between the parties as on date when the saleagreement was entered into was reflected in a communication ofrespondent no.1 which clearly showed that the existence of theencumbrance was a well known fact – In the face of such clearunderstanding under which the suit agreement was entered into,the High Court completely erred in ignoring the entire case putforth on the part of the appellant – The facts on record disclosedthat there were recurring delays on part of respondent no.1 – Thereare no details in the plaint as to what exactly respondent no.1 haddone towards fulfillment of his obligations and completion of thetransaction – Further, there was an arrangement between theparties by which respondent no.1 was to make payment of Rs.13.5lakhs to the bank directly and Rs.6 lakhs to the appellant, however,the facts do not indicate any observance of these conditions – Infact, the amount of Rs.13.5 lakhs was independently deposited anddischarge was obtained by the appellant – Therefore, issue whetherrespondent no.1 was ready and willing to perform his part of thecontract is answered against him and suit for specific performance

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Apreferred by the respondent no.1 is dismissed – The case put up byrespondent no.1 that he was put in possession pursuant to anarrangement is also doubtful – If respondent no.1 was put inpossession of the suit property pursuant to the arrangement as inthe suit agreement, his corresponding obligation under sucharrangement was two fold namely to pay off the dues to the BankBdirectly and pay rest of the sum to the appellant – There is nothingon record which could be consistent with discharge of suchobligation on part of respondent no.1 – Appellant is entitled torecovery of possession – Possession.

Specific performance: Readiness and willingness to performCthe contract – Held: As regards suit for specific performance, thelaw is very clear that plaintiff must plead and prove his readinessand willingness to perform his part of the contract all through i.e.,right from the date of the contract till the date of hearing of the suit.

Allowing the appeals, the CourtD

HELD: 1. If respondent No.1 was well aware about theexistence of encumbrance over the suit property at the time whensuit agreement was entered into, he cannot thereafter submit tothe contrary. In the face of such clear understanding under whichthe suit agreement was entered into, the High Court wasEcompletely in error in observing that the entire case put forth onthe part of the appellant was required to be summarily thrownout. [Para 7] [679-E, F]

Conclusion

2. The assertion made by respondent No.1 of the plaint isa mere assertion without any relevant details as to what exactlyFhe had done towards fulfillment of his obligations and completionof the transaction. Respondent No.1 had completely failed in hisobligations and was not ready and willing to perform his part ofthe contract. Even going by the case set up by respondent No.1,that around 29.07.2002 an arrangement was arrived at, underGwhich out of the balance amount Rs.19.5 lakhs, Rs. 13.5 lakhswere to be made over by respondent No.1 to the Bank directlyand rest of the sum of Rs.6 lakhs was to be paid to the appellantin cash, the facts do not indicate any observance of theseconditions. Beyond filing an application for impleadment which H

came to be dismissed, respondent No.1 did not take any step.The amount of Rs.13.5 lakhs was independently deposited anddischarge was obtained by the appellant. [Para 9] [680-D-F]

3. If respondent No.1 was put in possession of the suitproperty pursuant to the arrangement as suggested by him, hiscorresponding obligation under such arrangement was alsotwofold namely to pay off the dues to the Bank directly and payrest of the sum to the appellant. There is nothing on recordwhich could be consistent with discharge of such obligation onthe part of respondent No.1. The case put up by respondent No.1that he was put in possession pursuant to an arrangement arrivedat on or around 29.07.2002 is not free from doubt. In a matterwhere Rs.19.5 lakhs were still outstanding, it is not possible toaccept that the vendor may put the purchaser in possession whenthe original agreement did not contemplate handing over of thepossession even before execution of the sale deed. Thecontemporaneous facts including the aspects that the appellanthad initiated criminal proceedings and made complaints to variousauthorities about forcible possession having been taken byrespondent No.1, also indicate falsity in the claim of respondentNo.1. [Paras 10, 11] [680-G; 681-A, B]

S.P. Chengalvaraya Naidu (Dead) by LRs. v. Jaganath(Dead) by LRs and Others (1994) 1 SCC 1 : [1993] 3Suppl. SCR 422 – held inapplicable.

Gomathinayagam Pillai and Others v. PallaniswamiNadar [1967] 1 SCR 227 ; Ardeshir Mama v. FloraSassoon L.R. 55 I.A. 360 ; J.P. Builders and Another v.A. Ramadas Rao and Another (2011) 1 SCC 429 :[2010] 15 SCR 538 – referred to.

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ACIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 3353-3354 of 2018.

From the Order dated 07.01.2014 of the High Court of Judicatureat Madras in APPSU Nos. 218 and 219 of 2010.

V. Mohana, Sr. Adv., B. Raghunath, N. C. Kavitha, Vijay Kumar,BAdvs. for the Appellant.

V. Prabhakar, Ms. Jyoti Parasher, N. J. Ramchandar, S. Rajappa,Advs. for the Respondents.

The Judgment of the Court was delivered by CUDAY UMESH LALIT, J. 1. Leave granted.

2. These appeals by special leave challenge the correctness ofthe judgment and order dated 07.01.2014 passed by the High Court ofMadras in Appeal Suit (MD) Nos. 218-219 of 2010.

3. The facts leading to the filing of these appeals in brief are asDunder :-

A. The property in question is a plot admeasuring about 3708sq.ft., with a marriage hall (“Suit Property”, for short) situated in VillageParasuramanpatti, Madurai North Taluk, Tallakulakam sub- Division,Madurai North. The appellant had mortgaged the suit property with theECatholic Syrian Bank (later Federal Bank Ltd.) and the bank had initiatedrecovery proceedings, namely, O.S. No.40 of 1996 before 3[rd] AdditionalSub-Court, Madurai which was later transferred to DRT, Coimbatoreand renumbered as Transfer Application No.1441 of 2002.

B. On 30.06.2000 the appellant entered into an agreement(Ex.A1) intending to sell the suit property to respondent No.1. Theconsideration agreed was Rs.19 lakhs out of which Rs.1 lakh was paidby way of advance. This agreement recited an assurance on the part ofthe appellant, “…that there is no encumbrance over the Schedulementioned property” but went on to state:- F

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“The 2[nd] Party says that the original Parent Document in respectof the property is not available with the 2[nd] party and it is in thebank. In case, there is any loan availed by the 2[nd] party either onthe schedule property or on other property, then the 2[nd] party hasto pay the said loan amount by getting it from the 1[st] party and to H

get the Original Parent Document and other supportive records inrespect of the schedule property and the 2[nd] party has to handover the same to the 1[st] party.”

C. The cheques issued thereafter by respondent No.1 weredishonored (as evident from Notice Ex.A-2 dated 18.09.2000) but theparties entered into a subsequent agreement on 20.09.2000 (“the suitagreement”, for short) under which the consideration was fixed at Rs.37.5lakhs. As per this agreement, even the movables utilized for marriagehall were also included. Over and above Rs.1 lakh which was alreadyreceived as advance, additional sums of Rs.2 lakhs by way of chequeand Rs.3 lakhs by way of demand draft were paid on the same day.The suit agreement recited that the remaining amount had to be paid andthe sale deed to be registered by 20.03.2001 in following terms:- “………the 1[st] party has to pay the remaining amount of saleconsideration of Rs.26,50,000/- (Rupees twenty six lakhs and fiftythousand only) within 20.03.2001 either before the Sub Registraror in person and the 2[nd] party has to receive the same and giveproof to that effect and the said Sale Deed has to be registered bythe 2[nd] party without any encumbrance and that there is no otherperson except the 2[nd] party to have title over the same.”

D. Though the relevant terms in the suit agreement were identicalto those in agreement (Ex.A1), the understanding between the partiesas on the date when the suit agreement was entered into was capturedin the subsequent communication of respondent No.1 dated 22.09.2001(Ex.A6) as under :- “That on further persuasion and negotiations between the parties,it was agreed to have a fresh sale agreement with reference tothe said Kalyana Mandapam and annexe. As your client wantedto clear the entire loan in the Catholic Syrian Bank only by himself,the sale price of the said property was agreed for Rs.37,50,000/-only and a sum of Rs.5,00,000/- (Rupees five lakhs only) throughD.D. and Cheque was paid additionally to your client by makingthe total advance of Rs.6,00,000/- including the cash advance ofRs.1,00,000/- already paid on the earlier agreement dated30.06.2000. Therefore in supersession of the earlier agreementdated 30.06.2000 a fresh sale agreement was made on 20.09.2000with the parties concerned.”

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AE. On 21.02.2001 a further sum of Rs.2 lakhs was paid by way ofcheque by respondent No.1. Though the transaction was to be completedby 22.03.2001 the record is silent about any communication between theparties around that time towards completion of transaction. However,amount of Rs.10 lakhs was paid by cheque on 22.09.2001, whichaccording to respondent No.1 was made over to the appellant so thatBthe dues of the bank could be settled.

F. The record is again silent about any developments after22.09.2001 till 29.07.2002 when a legal notice was issued by respondentNo.1 through his advocate. According to respondent No.1 this wasresponded by the advocate for the appellant and in the ensuing discussionCit was agreed that possession of the suit property be handed over torespondent No.1. According to respondent No.1, out of the balanceamount of Rs.19.5 lakhs, Rs.13.5 lakhs was to be made over byrespondent No.1 to the bank directly and the remaining sum of Rs.6lakhs was agreed to be paid to the appellant in cash on the day theDdocument was to be registered. According to respondent No.1, possessionof the suit property was handed over to him by the appellant on 03.08.2002.

The aforesaid case set up by respondent No.1 is disputed anddenied by the appellant and according to him, with the intervention oflocal police and other hirelings, the possession was forcibly taken byErespondent No.1 on 16.09.2002.

G. On 01.09.2002, a telegram was sent by the advocate forrespondent No.1 to the appellant. Immediately thereafter i.e. on02.09.2002 an IA No.126 of 2002 was preferred by respondent No.1 toimplead himself in the Transfer Application No.1441 of 2002 before DRT,FCoimbatore. In his reply telegram dated 03.09.2002 appellant denied allthe assertions made by the advocate for respondent No.1 and cancelledthe agreement dated 20.09.2000. The appellant also complained to DIGof the relevant range and sought police protection and preferred OPNo.226 of 2002 in the High Court of Madras against respondent No.1,Inspector of Police, Oomachikulam and Deputy Superintendent of PoliceGof the concerned Division. According to the appellant, he was threatenedby the hirelings employed by respondent No.1 and possession of the suitproperty was taken over by respondent No.1 on 16.09.2002. Thisprompted the appellant to prefer an appropriate petition before theSuperintendent of Police, Madurai, Rural.

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H. In the aforesaid background, on 19.02.2002, respondent No.1filed OS No.764 of 2002 seeking specific performance of the agreementdated 20.09.2000. The plaint was later amended and the Federal BankLtd. through its Branch Manager was added as second defendant. Asregards arrangement under which respondent No.1 was put in possession,it was averred:

“……. Meanwhile, as necessary steps have to be taken forsettlement of the loan availed on the suit property, the advocatesof both the sides have held a meeting on 29.07.2002 to executethe Sale Agreement made on 20.09.2000 and it was agreed thatthis defendant has to execute the Sale Deed in respect of the suitproperty on the 18[th] day of Aadi month of this year (3.08.2002);that the remaining sale consideration of Rs.13,00,000/- out ofRs.19,50,000/- has to be paid by the plaintiff to settle the casewhich is being conducted at Debts Recovery Tribunal; that theremaining amount of Rs.6,50,000/- (Rupees six lakhs and fiftythousand only) has to be given to the 1[st] defendant as cash ….”

In respect of readiness and willingness on the part of respondentNo.1 to perform his obligations under the suit agreement, Para 7 of theamended plaint was as under:

“(7) While this plaintiff was ready to fulfill the sale agreement on3.8.2002 as per the above said arrangement, as agreed to executethe Sale Deed either on the 3[rd] day of Aavani Month (19.8.2002)or on 5[th] day of Aavani (21.8.2002) and that there is somedifficulty according to religious custom in registering the sale deedin the month of Aadi and to give consent to this plaintiff to takethe possession of the marriage hall, this plaintiff took thepossession of the suit property on the 18[th] day of Aadi Month on3.8.2002 and he has been enjoying the same. The marriagefunctions which were being booked by the 1[st] defendant are beingconducted by this plaintiff under his supervision.”

I. In his written statement, the appellant denied relevant assertionsmade by respondent No.1. As regards readiness and willingness on thepart of respondent No.1, it was stated:- “It is submitted that in spite of defendant’s repeated demands theplaintiff has not come forward either to pay balance sale price or A

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Ato complete the sale immediately. Even though specific conditionto complete the sale on or before 20.03.2001 is mentioned in thesale agreement and time is mentioned as essence of the contract,the plaintiff has not completed the sale within the stipulated time.The plaintiff was not ready and willing to perform his part ofcontract even though the defendant was ready to clear theBencumbrance over the suit property.”The matter regarding handing over of possession was elaboratedas under:

“On 16.09.2002, the plaintiff came with his men and threatenedCthe defendant that why he had cancelled the sale agreement andif he did not execute sale deed in his favour he would not permitthe defendant to enjoy the suit property. The defendantimmediately went to the office of the Police Commissioner, MaduraiCity wherein he was asked to come tomorrow. On 17.09.2002he presented a petition to the Police Commissioner, Madurai CityDand it was forwarded to SP, Madurai Rural. When the defendantwas in the office of the SP, Madurai Rural, at the instigation of theplaintiff one Karthick Muniasamy of Pudur with his men namelyRajesh, Kannan, Muniasamy and other attacked the watchmanof the suit property and illegally trespassed into the suit propertyEand damaged the property and took illegal possession of the suitproperty. On coming to know about the illegal taking over possessionof the suit property by the plaintiff’s men, the defendantimmediately told this matter to the SP, Madurai Rural who madeendorsement on the petition directing the Inspector of Police,Oomachikulam to register F.I.R. against the plaintiff and hisFmen. .….”

J. In his Additional Written Statement-cum-Counter Claim theappellant submitted:

“The application in I.A. No.126/2002 filed by the plaintiff in T.A.GNo. 1441/2002 pending before the DRT, Coimbatore was dismissedon 03.01.2003. In the meantime the defendant has also paid Rs.13lakhs to the Federal Bank, Madurai after the filing of the suit tilldate.”

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He further submitted:

“It is submitted that the plaintiff has taken illegal possession of thesuit property as stated above and his possession is unlawful. Hehas been in receipt of unlawful gains on account of being in illegalpossession and receiving income from the suit property. The suitproperty used to be booked for a minimum of 30 Muhoorthamsper year. After deducting all expenses the year income from thesuit property is Rs.1,80,000/-. From 17.09.2002 to till filing of thiscounter-claim approximately the past mesne profits would beRs.5,40,000/-. The plaintiff is liable to pay Rs.5,40,000/- as pastmesne profits from 17.09.2002 to the date of filing of this AdditionalWritten statement cum counter claim. In these circumstances adecree for mandatory injunction and for mesne profits is to begranted, where the 1[st] defendant would be put to irreparable lossand damage.”

The appellant in the circumstances prayed for delivery ofpossession of the suit property, past mesne profits of Rs.5,40,000/- andfuture mesne profits as well.

K. The Presenting Officer of the Federal Bank Ltd. filed a memoon 08.12.2009 in the proceedings before DRT Coimbatore that theappellant had remitted a sum of Rs.13,42,173/- on 16.11.2009 towardsfull and final settlement of the account. It was therefore prayed by thePresenting Officer that satisfaction of the claim be recorded.

L. The trial court by its judgment and decree dated 01.10.2010decreed OS No.764 of 2002 and dismissed the counter claim preferredby the appellant. All the issues were answered in favour of respondentNo.1. The appellant was directed to execute the sale deed in respect ofthe suit property and register the same in favour of respondent No.1after receiving the balance sale consideration within three months andthe appellant was further directed to pay to respondent a sum ofRs.3,23,038/- towards the costs of the suit. It was observed that timewas not the essence of the contract. As regards readiness and willingnesson the part of respondent No.1, it was observed as under:

“While considering the readiness and willingness of the plaintiffas to purchase the suit properties it was submitted by the counsel A

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Afor the plaintiff that as agreed the plaintiff did issue the legal noticeto the 1[st] defendant to come forward to register suit propertiesafter getting full consideration and also the plaintiff was waitingon 03.08.2002 in the suit Sub-Registrar office as to register thesuit properties as agreed and also the plaintiff was ready to paythe full amount and willing to purchase the suit properties.”B

M. The matter was carried further by filing Appeals by the appellantin the Madras High Court, Madurai Bench. According to the High Courtbefore the execution of suit agreement the appellant had not disclosedabout the existence of encumbrance which fact came to the knowledgeof respondent No.1 subsequently. Relying on the decision of this CourtCin S.P. Chengalvaraya Naidu (Dead) by LRs v. Jaganath (Dead) byLRs and Others.[1] it was observed as under:

“Since the first defendant has suppressed the fact that he obtainedloan by way of encumbering the suit property and also pendencyof Original Suit No.40 of 1996 at the time of execution of Ex.A3,Dit is pellucid that the entire defence put forth on the side of thefirst defendant is based upon falsehood.

….. But for the reasons best known to him, schemingly, deliberatelysuppressed the existence of mortgage over the suit property andfurther stated in Ex.A3 to the effect that there is no encumbranceEover the same. Therefore, the entire defence put forth on theside of the first defendant is purely based upon falsehood and asper the dictum given by the Hon’ble Apex Court the defence putforth by the first defendant in the present case can summarily bethrown out.”

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The High Court found that the readiness and willingness on thepart of respondent No.1 stood established. The High Court, thus, by itsjudgment and order dated 07.01.2014 dismissed the appeals, namely,Appeal Suit Nos.218-219 of 2010 preferred by the appellant.

4. This Court issued notice on 25.08.2014 in petitions for specialGleave to appeal. The parties exchanged the pleadings and also fileddocuments on record.

We heard Ms. V. Mohana, learned Senior Advocate in support ofthe appeals and Mr. V. Prabhakar, learned Advocate for respondent 1 (1994) 1 SCC 1H

No.1. After conclusion of hearing, written submissions were filedby respondent No.1 submitting inter alia:- “Apart from having averred regarding the readiness andwillingness, respondent No.1 by his conduct had proved the samewhich are as below:-

i) Payment of an advance of Rs.6,00,000/- on 20.09.2000.

ii) Further advance of Rs.2,00,000/- paid on 21.01.2001.

iii) Further advance of Rs.10,00,000/- paid on 22.09.2001.

iv) Notice dated 22.09.2001 issued by the respondent to thepetitioner to execute the sale deed.

v) Holding a meeting of the petitioner, his counsel with therespondent and his counsel for determining the manner ofperformance of the Agreement. The said factum of the meetingand the outcome thereof as set out in the Plaint in Para 6 at Page136 of Volume II stood admitted by the respondent in the Noticedated 29.07.2002 issued on his behalf which had been marked asExhibit A15.

vi) Taking possession of the property on 03.08.2002.

vii) Seeking impleadment in the Debt Recovery proceedings witha view to settle the debt due from the Respondent.

viii) Filing of the Suit within 9 days after the telegram dated03.09.2002 issued by the petitioner cancelling the agreement. Suithad been filed on 12.09.2002. ……………..

The non deposit of the balance consideration by respondent No.1cannot be put against respondent No.1 inasmuch as theencumbrance came to light after the agreement to sell which oughtto have been cleared by the petitioner by demanding the amountfor the discharge in terms of the recital at page 37 of the SLPpaper book[2] which was never done by the petitioner. As per therecital in the Agreement to sell the petitioner had to handover theoriginal parent title deed and other supportive documents whichwas again not done despite having received nearly half of the saleconsideration. Since the parent title deed had not been given asrequired under the agreement, possession was given to respondentNo.1.”

2 As quoted in Paragraph 3(B) above

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A5. In Gomathinayagam Pillai and Others v. Pallaniswami Nadar[3]after referring to the observations of the Privy Council inArdeshir Mama v. Flora Sassoon[4], this Court laid down that in a suitfor specific performance of an agreement, the plaintiff must plead andprove that he was ready and willing to perform his part of the contractsince the date of the contract, right upto the date of the hearing of theBsuit. The observations by this Court in that behalf were as under:- “But the respondent has claimed a decree for specificperformance and it is for him to establish that he was, since thedate of the contract, continuously ready and willing to perform hispart of the contract. If he fails to do so, his claim for specificCperformance must fail. As observed by the Judicial Committeeof the Privy Council in Ardeshir Mama v. Flora Sasson [ L.R.55 I.A. 360, 372 ]

“In a suit for specific performance, on the other hand, he treatedand was required by the Court to treat the contract as stillDsubsisting. He had in that suit to allege, and if the fact wastraversed, he was required to prove a continuous readinessand willingness, from the date of the contract to the time of thehearing, to perform the contract on his part. Failure to makegood that averment brought with it the inevitable dismissal ofEhis suit.”

The respondent must in a suit for specific performance of anagreement plead and prove that he was ready and willing toperform his part of the contract continuously between the date ofthe contract and the date of hearing of the suit.”F6. Similarly in J.P. Builders and Another v. A. Ramadas Raoand Another[5], it was observed by this Court in paragraphs 21 and 25 asunder :- “21. Among the three clauses, we are more concerned aboutclause (c). “Readiness and willingness” is enshrined in clause (c)Gwhich was not present in the old Act of 1877. However, it waslater inserted with the recommendations of the 9th LawCommission’s Report. This clause provides that the person seeking 3 (1967) 1 SCR 227

4 L.R. 55 I.A. 360

H5 (2011) 1 SCC 429

specific performance must prove that he has performed or hasbeen ready and willing to perform the essential terms of thecontract which are to be performed by him.

25. Section 16(c) of the Specific Relief Act, 1963 mandates“readiness and willingness” on the part of the plaintiff and it is acondition precedent for obtaining relief of grant of specificperformance. It is also clear that in a suit for specific performance,the plaintiff must allege and prove a continuous “readiness andwillingness” to perform the contract on his part from the date ofthe contract. The onus is on the plaintiff.”

7. The assurance given by the appellant at the time when theagreement dated 30.06.2000 (Ex.A1) was executed that there was noencumbrance over the suit property was not a correct statement of fact.The further recital that the “Original Parent Document” was in the Bankagain was not a fair and complete disclosure. It is true that theseaverments were copied in the subsequent suit agreement dated20.09.2000. However the communication dated 22.09.2001 (Ex.A6)emanating from respondent No.1 records that by the time the suitagreement was entered into the existence of the encumbrance was awell known fact. For the purposes of the present matter what is importantis the common understanding with which the parties had entered into thetransaction. If respondent No.1 was well aware about the existence ofencumbrance over the suit property at the time when suit agreementwas entered into, he cannot thereafter submit to the contrary. In theface of such clear understanding under which the suit agreement wasentered into, the High Court was completely in error in observing thatthe entire case put forth on the part of the appellant was required to besummarily thrown out. Further, reliance on the decision in S.P.Chengalveraya Naidu (supra) was also misplaced. That case did notarise from a suit for specific performance and more over the plaintiff inthat case was found to have withheld relevant documents and as suchthe judgment rendered by the trial Court dismissing his claim was restoredby this Court. The principle laid down therein cannot apply either onfacts or in law to the present case.

8. As regards suit for specific performance, the law is very clearthat the plaintiff must plead and prove his readiness and willingness to AB

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Aperform his part of the contract all through i.e., right from the date of thecontract till the date of hearing of the suit. If respondent No.1 was wellaware about the encumbrance and the parties had chosen that the balanceconsideration be paid to the appellant before 20.03.2001 so that the saledeed could be registered without any encumbrance, it was for respondentNo.1 to have taken appropriate steps in that behalf for completion ofBtransaction. The facts on record disclose that the first step taken byrespondent No.1 after the suit agreement was well after four months,when further amount of Rs.2 lakhs was paid on 21.01.2001. Thereafternothing was done till 20.03.2001 by which the transaction had to becompleted. The record is completely silent about any communicationCsent around 20.03.2001 towards completion of transaction. As a matterof fact the first step thereafter was six months after the deadline namelyon 22.09.2001 when the communication (Ex.A6) was sent along withamount of Rs.10 lakhs. The written submissions filed on behalf ofrespondent No.1 also do not indicate any steps till this time so as to saythat he was all the while ready and willing to complete the transaction.D

9. The assertion made by respondent No.1 in paragraph 7 of theplaint is a mere assertion without any relevant details as to what exactlyhe had done towards fulfillment of his obligations and completion of thetransaction. The factual aspects as detailed above are quite clear thatErespondent No.1 had completely failed in his obligations and was notready and willing to perform his part of the contract. Even going by thecase set up by respondent No.1, that around 29.07.2002 an arrangementwas arrived at, under which out of the balance amount Rs.19.5 lakhs,Rs. 13.5 lakhs were to be made over by respondent No.1 to the Bankdirectly and rest of the sum of Rs.6 lakhs was to be paid to the appellantFin cash, the facts do not indicate any observance of these conditions.Beyond filing an application for impleadment which came to be dismissed,respondent No.1 did not take any step. The amount of Rs.13.5 lakhswas independently deposited and discharge was obtained by the appellant.

10. If respondent No.1 was put in possession of the suit propertyGpursuant to the arrangement as suggested by him, his correspondingobligation under such arrangement was also twofold namely to pay offthe dues to the Bank directly and pay rest of the sum to the appellant.There is nothing on record which could be consistent with discharge ofsuch obligation on the part of respondent No.1.

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11. The case put up by respondent No.1 that he was put inpossession pursuant to an arrangement arrived at on or around 29.07.2002is not free from doubt. In a matter where Rs.19.5 lakhs were stilloutstanding, it is not possible to accept that the vendor may put thepurchaser in possession when the original agreement did not contemplatehanding over of the possession even before execution of the sale deed.The contemporaneous facts including the aspects that the appellant hadinitiated criminal proceedings and made complaints to various authoritiesabout forcible possession having been taken by respondent No.1, alsoindicate falsity in the claim of respondent No.1. Be that as it may thebasic issue is whether respondent No.1 was ready and willing to performhis part of the contract which in our considered view has to be answeredagainst him. We are conscious that two Courts have arrived at a findingof fact but in our view such finding is completely opposed to and contraryto the facts on record and is completely unsustainable.

12. We, therefore, reject the claim of respondent No.1 and holdthat the suit for specific performance preferred by respondent No.1 isrequired to be dismissed. At the same time we accept the counter claimmade by the appellant and hold that he is entitled to recovery ofpossession. It appears that the assertions in the counter claim that theKalyana Mandapam was fetching Rs.1,80,000/- per annum were notdisputed or denied by respondent No.1. On the score that the appellantwas wrongfully denied and deprived of the earnings from KalyanaMandapam for the last 16 years, he would be entitled to reasonablereturn. But at the same time he had retained and enjoyed sum of Rs.18lakhs which he had received by way of advance from respondent No.1.In the circumstances, though we would direct refund of the sum of Rs.18lakhs, we further deem it appropriate to direct that in the circumstancesneither would respondent No.1 be entitled to any interest on the sum ofRs.18 lakhs which was given by way of advances under the suitagreement to the appellant nor would appellant be entitled to any sum byway of mesne profits for last 18 years of wrongful possession of the suitproperty by respondent No.1.

13. Allowing the appeal, we therefore direct:- (a) The suit for specific performance filed by respondent No. 1 isdismissed. Respondent No.1 shall be entitled to the refund of sum of A

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ARs.18 lakhs paid by way of advance under the suit agreement. Saidsum shall be refunded by the appellant within three months from thedate of this judgment. No interest shall be payable on said sum. However,if the said sum is not paid within three months from today as directed, itshall carry interest @ 7½ per cent from the date of expiry of said periodof three months.

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(b) Counter claim preferred by the appellant is allowed.Respondent No.1 shall deliver vacant and peaceful possession of thesuit property to the appellant within one month from the date of thisjudgment. The appellant shall however not be entitled to any mesneprofits in respect of wrongful possession of the suit property by respondentCNo.1.

(c) The decree passed by the trial court and affirmed by the HighCourt stands modified accordingly. Each party shall bear his own coststhroughout.

D14. The appeals stand allowed in the aforesaid terms.

Ankit Gyan

Appeals allowed.

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