RITU SAXENA versus J. S. GROVER & ANR. on 17 September 2019

1. The unsuccessful plaintiff is in appeals before this Court arisingout of a suit for specific performance of an Agreement dated July 18,2004 in respect of Flat No. 272, Ground Floor, Gulmohar Enclave, NewGDelhi.

2. The husband of the appellant, who as an employee of M/s. GECapital Services India Ltd., was in occupation of the said residentialpremises on a monthly rent of Rs.13,000/- to be paid by the tenant i.e.M/s. GE Capital Services India Ltd. since September 2002 to the landlord.

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On the expiry of the existing lease, the Agreement of Lease was extendedfor 11 months from September 01, 2004 but before the expiry of thelease, the appellant claims to have entered into an Agreement of Purchasethe said property for a total sum of Rs.50 lakhs. A sum of Rs.1 lakh bycheque was paid to the defendants. It was agreed that all further relevantdocuments such as Agreement to Sell, Sale Deed, Will, PossessionCertificate and No Objection Certificate for the purpose of transferringthe said property shall be executed. The Agreement reads thus:

“I, J. S. Grover S/o G. S. Grover, resident of M-12 (First Floor)Kailash Colony, New Delhi 48 have agreed in principle and interms to sell my house (for a consideration of Rs. 50 lacs) whichis a freehold joint property in my name and in my wife’s nameSmt. Veena Grover, known as house bearing no.272, GulmoharEnclave New Delhi 1100049.

In this transaction I acknowledge the receipt of Rs. 1 lac asadvance money by cheque number 044386 dt. 18.7.2004 issuedfrom ICICI Bank Vasant Vihar New Delhi and agree to furnishall the further relevant document such as Agreement to Sale, SaleDeed, Will, Possession Certificate, NOCs etc. for the purpose oftransferring the above said property in the name of Ritu Saxenaat present residing at 272, Gulmohar Enclave New Delhi 110049and a permanent resident of B-377 Indira Nagar Lucknow, U.P.

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(J. S. Grover)”

3. The appellant relies upon communication dated July 30, 2004that a loan of Rs.50 lakhs has been approved by the ICICI Home FinanceCompany Limited[1] but the disbursal of the loan was only after the bankreceives all income tax and property documents as discussed with herhusband. The appellant is said to have written a letter to the defendantson September 14, 2004 to fix the date to complete the pendingdocumentation and other formalities followed by another letter datedDecember 21, 2004. A legal notice dated April 19, 2005 was also served.In reply dated April 27, 2005, it was asserted that a formal Agreement toSell was to be executed on or before July 21, 2004 and the appellant wasto pay 25% of the total consideration. Since the appellant has failed to 1 for short, ICICI

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Apay 25% of the total consideration amount, therefore, the Agreement isnot enforceable. It is thereafter on May 25, 2005, suit for specificperformance was filed.

4. The respondents denied the claim of the appellant to seekspecific performance of the Agreement dated July 18, 2004. The partiesBled the evidence. The learned Trial Court dismissed the suit on February28, 2018, inter alia, holding that though the Agreement to Sell wasexecuted but appellant has failed to prove her readiness and willingnessto perform her part of the contract. However, the appellant was foundentitled to Rs.1 lakh and interest thereon. A decree to this effect waspassed by the learned Trial Court. The first appeal was dismissed byCthe High Court on July 17, 2018 affirming the findings recorded by theTrial Court. Still aggrieved, the appellant is before this Court.

5. Learned counsel for the appellant vehemently argued that theappellant has earlier availed the loan of Rs.13 lakhs for purchase of aflat in Ghaziabad. At that time, Rs.90 lakhs were assessed as the capacityDto avail loan by ICICI. Later, the appellant applied for loan to purchasethe property in question. The Bank has approved the loan of Rs.50lakhs but same was not disbursed since an Agreement on a stamp paperof Rs.50/- was not executed by the defendants. Therefore, the appellanthas proved her readiness and willingness to perform her part of theEcontract and the finding recorded by the High Court is not sustainable.

6. In support of her claim, the appellant tendered her evidence onaffidavit and made herself available for cross-examination as PW-1.PW-2 is her husband whereas PW-3 is the official from the ICICI whohas deposed regarding the loan sought by the appellant and/or herFhusband. The appellant relied upon sanction letter dated July 30, 2004(Ex.PW3/1) issued by ICICI. She stated that she had sufficient fundsand resources which she can draw and is in a position to complete thetransaction in her favour. She also stated that the combined annualincome of her and her husband is about Rs.80 lakhs per annum and theycan easily avail a loan of upto Rs.1 crore from any bank and a sum ofGRs.50 lakhs is very easy to muster. Similar is the affidavit of PW-2Vishnu Kant, husband of the appellant. PW-3 is Anil Kumar Shrivastava,Zonal Head (North), ICICI who confirmed that the letter dated July 30,2004 shown to him from judicial file was issued by his Company though,his Company does not have any copy of this letter in the record. InHcross-examination, he stated that 2-3 months prior to the said approval, RITU SAXENA v. J. S. GROVER & ANR.[HEMANT GUPTA, J.]

Vishnu Kant and the appellant were sanctioned home loan to the tune ofRs.13 lakhs though they were entitled for the loan to the extent of Rs.90lakhs keeping in view their solvency. They had applied for a loan ofRs.60 lakhs but later on, down sized their requirement to about Rs.13lakhs for purchasing the property other than the suit property and thatthey have never received the papers related to Flat No. 272, GroundFloor, Gulmohar Enclave, New Delhi.

7. The document of availing loan of Rs.13 lakhs shows that theloan has been sanctioned in respect of application No. 777-2415523. Itis the same application number which is relied upon by the appellant forapproval of Rs.50 lakhs as home loan to purchase the property in question.

8. The learned Trial Court in respect of issue no. 2 as to whetherthe plaintiff was ready and willing to perform her part of the Agreementto Sell, returned the following finding:

“However, both the plaintiff – PW-1 and her husband – PW-2have throughout the cross-examination deposed that they werehaving funds/financial capacity to purchase the property. PW-1has deposed that on 09.04.2005 when they went to the defendantshouse they were carrying a banker’s cheque with them. But hasneither given any details of the banker’s cheque nor has placedon record a copy of the banker’s cheque. Further, even copy ofthe passbook/bank statement of the account from which thebanker’s cheque was got prepared, has been filed in support ofher averment and to show that the banker’s cheque was actuallygot prepared. Further, PW-1 deposed that they had a propertyworth Rs.80 lakhs but again neither any details of the said propertyhave been stated nor a copy of those property documents hasbeen placed on record in support of this version. Thus, not evena single document has been filed to show that the plaintiff at anypoint of time from 18.07.2004 till filing of the suit, owned otherproperty or had money in her bank account or in the account ofher husband or any other source of fund for payment of the balancesale consideration of Rs.49 lakhs. In absence thereof, thestatements of PW-1 and PW-2 are nothing more than baldaverments carrying no weight.”

9. The Trial Court, thus, held that the appellant is not entitled tothe specific performance of the Agreement to Sell but granted a decree AB

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Aof recovery of Rs.1 lakh with 15% interest per annum from the date ofAgreement till recovery thereof.

10. In appeal, the High Court initially has taken into considerationthat only loan of Rs.13 lakhs were sanctioned as against the balancesale consideration of Rs.49 lakhs but subsequently, the said aspect wasBcorrected finding error in view of the fact that a loan of Rs.13 lakhs wassanctioned in respect of the another property. The High Court held thatself-serving averments in the affidavit of the appellant and her husbandcannot be taken as discharge of onus of proof of having financial capacity.What is the evidence and what is the weight to be attached to the evidenceare two separate aspects and oral statements on important aspects ofCfinancial capacity cannot be accepted by the courts as proof of financialcapacity. The High Court did not find any favour with the argument thatthere is no cross-examination in respect of financial capacity of theappellant and her husband. It was found that suggestion, that the appellantand her husband have deposed falsely, was considered sufficient so asDto dispute her financial capacity and to disprove her readiness andwillingness to perform her part of the agreement. The High Court alsotook the fact that the appellant is not entitled to discretionary specificperformance as the appellant has paid Rs.1 lakh which is 2% of the totalsale consideration of Rs.50 lakhs. The High Court also took notice ofthe fact that the defendants have filed a suit for possession against theEtenant that is the employer of her husband as they failed to vacate thesuit property after the expiry of the lease period. The decree of possessionhas attained finality and that the defendants have taken possession ofthe property as well.

11. Learned counsel for the appellant refers to judgment of thisFCourt in A. Kanthamani v. Nasreen Ahmed[2] to contend that readinessand willingness is not as if the appellant is to carry hard cash or theamount in Bank but it is financial capacity to pay. The appellant hasproved her capacity to pay the balance sale consideration. This Court inthe cited case held as under:G“26. This Court in Sukhbir Singh v. Brij Pal Singh [SukhbirSingh v. Brij Pal Singh, (1997) 2 SCC 200 : AIR 1996 SC 2510]followed the aforesaid principle with these words: (SCC p. 202,para 5)

H2 (2017) 4 SCC 654

RITU SAXENA v. J. S. GROVER & ANR.[HEMANT GUPTA, J.]

“5. Law is not in doubt and it is not a condition that therespondents should have ready cash with them. The fact thatthey attended the Sub-Registrar’s office to have the sale deedexecuted and waited for the petitioners to attend the office ofthe Sub-Registrar is a positive fact to prove that they hadnecessary funds to pass on consideration and had with themthe needed money with them for payment at the time ofregistration. It is sufficient for the respondents to establish thatthey had the capacity to pay the sale consideration. It is notnecessary that they should always carry the money with themfrom the date of the suit till the date of the decree. It would,therefore, be clear that the courts below have appropriatelyexercised their discretion for granting the relief of specificperformance to the respondents on sound principles of law.”

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28. At the outset, we may observe that this Court is loath toundertake the task of appreciating the evidence in an appeal filedunder Article 136 of the Constitution of India. It is more so whensuch appeal arises out of the judgment, which has recordedconcurrent findings of fact.”

12. The argument of the appellant that the capacity to pay is provedby the approval of loan by ICICI and the fact that the appellant and herhusband have substantial income of Rs.80 lakhs per annum, therefore,the findings recorded by both the Courts below are not sustainable.

13. On the other hand, Mr. Narender Hooda, learned seniorcounsel for the respondents, submitted that the appellant is seekingreappreciation of evidence in the present appeal under Article 136 of theConstitution of India. There is no substantial question of law of generalimportance which is arising for consideration of this Court. It is alsoargued that relief for specific performance is a discretionary relief. Boththe courts have declined discretionary relief, therefore, no case is madeout for interference in the present appeals.

14. We do not find any merit in the present appeals. The judgmentin A. Kanthamani was in an appeal filed by the defendant against theconcurrent finding of fact recorded by the courts below granting decreeof specific performance of the Agreement. This Court has not interferedwith the findings of fact recorded even after reappreciation of evidence.

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A15. Coming to the facts of the present case, the sole documentrelied upon by the appellant to prove her readiness and willingness is theapproval of loan on July 30, 2004 by the ICICI. Such approval wassubject to two conditions, viz., furnishing of income tax documents ofthe appellant and the property documents. M/s. ICICI has sent an Emailon May 12, 2005 to the husband of the appellant requiring an AgreementBto Sell on a stamp paper of Rs.50/- to be executed between the parties,as per the legal opinion sought from the empaneled lawyer, without whichICICI will not be able to disburse the loan. Admittedly, no agreementwas executed on stamp paper, therefore, the appellant could not availloan of Rs.50 lakhs from ICICI. Independent of such loan, there isCmere statement that appellant and her husband have income of Rs.80lakhs per annum unsupported by any documentary evidence. Suchstatement will be in the nature of ipsi dixit of the appellant and/or herhusband and is without any corroborating evidence. Such self-servingstatements without any proof of financial resources cannot be reliedupon to return a finding that the appellant was ready and willing to performDher part of the contract. The appellant has not produced any income taxrecord or the bank statement in support of her plea of financial capacityso as to be ready and willing to perform the contract. Therefore, merefact that the bank has assessed the financial capacity of the appellantwhile granting loan earlier in respect of another property is not sufficientEto discharge of proof of financial capacity in the facts of the presentcase to hold that the appellant was ready and willing to perform her partof the contract. Such is the finding recorded by both the courts below aswell.

16. In view of the said fact, we do not find, even on reappreciationFof evidence, that the finding recorded by the High Court suffers fromany illegality which may warrant interference in the present appeals.Consequently, the appeals are dismissed.

17. The amount of Rs. 3.5 crores deposited by the appellant interms of order dated November 19, 2018 of this Court, which has beenGinvested in the FDR, may be returned to her, along with the interestaccrued thereon, as per rules.

Kalpana K. Tripathy

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