T. D. VIVEK KUMAR & ANR versus RANBIR CHAUDHARY on 28 April 2023

1. Feeling aggrieved and dissatisfied with the impugned judgmentand order passed by the High Court of Punjab and Haryana at Chandigarhin Review Application No. 149-C/2016 in RSA No. 596/2012 and XOBJC-10C/2010, the original defendants have preferred the present appeals.

2. The facts leading to the present appeals are as under: - 2.1 That a “sale agreement” was entered into between appellantNo. 1 as attorney of appellant No. 2 (original defendants) and therespondent herein (original plaintiff) for sale of the suit plot in questionfor a consideration of Rs. 17,61,700/-. The date for execution andregistration of sale deed was tentatively fixed as 18.09.2004. A totalamount of Rs. 2 lakh was paid as earnest money by the respondent.That thereafter, respondent – original plaintiff instituted the civil suit inthe Court of Additional Civil Judge (Senior Division), Faridabad, seekingspecific performance of sale agreement and consequential relief ofinjunction. The suit was resisted by the appellants herein – originaldefendants on all grounds including the ground that even as per theagreement to sell and on failure of the defendants to execute the saledeed, the plaintiff shall be entitled to double the amount given as anadvance and therefore, the plaintiff is not entitled to the decree for specificperformance.

2.2 The learned Trial Court vide judgment and decree dated16.01.2010 refused to pass a decree for specific performance of thesale agreement, however, decreed the suit for recovery of Rs. 4 lakhsi.e., double of the earnest money paid by the plaintiff in accordance withthe contract i.e., sale agreement.

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A2.3 The First Appellate Court dismissed the appeal. Feelingaggrieved and dissatisfied with the judgment and decree passed by thelearned Trial Court confirmed by the First Appellate Court refusing togrant the relief of specific performance of the sale agreement, therespondent herein – original plaintiff preferred the second appeal beforethe High Court. The appellant(s) also filed the cross objection in theBsecond appeal on the findings recorded by the learned Trial Court andthe First Appellate Court that the plaintiff wasready and willing to performhis part of the contract. By the impugned judgment and order dated27.07.2016 the High Court allowed the second appeal by way ofoverturning the concurrent judgments of the learned Trial Court confirmedCby the First Appellate Court and consequently, granted the relief ofspecific performance of the sale agreement by observing that as theplaintiff was ready and willing to perform his part of the contract andtherefore, he is entitled to the decree for specific performance. TheHigh Court dismissed the cross objection preferred by the appellants –original defendants.D

2.4 That aggrieved by the judgment and order dated 27.07.2016passed by the High Court allowing the second appeal and dismissing thecross objection, the appellants herein preferred Special Leave Petition(C) Nos.32215-32216/2016 before this Court. The appellants wererelegated to file a review petition before the High Court as according toEthe appellants the High Court did not consider the relevant clauses ofthe sale agreement which as such were considered by the learned TrialCourt as well as the First Appellate Court.

2.5 That thereafter, the appellants filed the present ReviewApplication No.149/2016 before the High Court. By the impugnedFjudgment and order the High Court has dismissed the review applicationbyobserving that there is no error apparent on record and no ground forreview is made out. Hence, the present appeals.

3. Shri Guru Krishna Kumar, learned Senior Advocate appearingon behalf of the appellants – original defendants, has vehementlysubmittedGthat in the facts and circumstances of the case the High Court hascommitted a very serious error in dismissing the review application whichas such was filed pursuant to the liberty reserved by this Court. It issubmitted that as while allowing the second appeal the relevant clausesof the sale agreement was not considered by the High Court and thereHwere certain factual errors and even the cross objection was rejected without consideration; the High Court ought to have allowed the reviewapplication and ought to have considered the entire appeal on merits. Itis further submitted that even otherwise the High Court has materiallyerred in passing the decree for specific performance of the saleagreement which as such was refused by the learned Trial Court as wellas the First Appellate Court.

3.1 It is submitted that even while allowing the second appeal theHigh Court did not specifically frame any substantial question of lawwhich as such was required to be framed as per Section 100 of theCPC.

3.2 It is further submitted that the High Court has not properlyappreciated and considered the fact that even as per the sale agreementif the first party – appellant fail or refuse to execute the sale agreementwithin the stipulated time, the seller shall be responsible to pay doublethe amount given as an advance. It is submitted that therefore, assumingthat there was failure on the part of the defendant(s) to execute the saledeed in favour of the plaintiff within the stipulated time, the plaintiff shallonly be entitled to double the amount given as an advance. It is submittedthat therefore, as such both the Courts below rightly refused to pass adecree of specific performance.

3.3 Making the above submissions and relying upon paragraph 31of the decision of this Court in the case of P. D’Souza Vs. ShondriloNaidu (2004) 6 SCC 649, it is prayed to allow the present appeals.

4. While opposing the present appeals, Shri Daya Krishan Sharma,learned counsel appearing on behalf of the respondent – original plaintiffhas vehemently submitted that in the present case there are concurrentfindings recorded by all the courts below on readiness and willingnesson the part of the plaintiff to perform his part of the contract and it wasthe defendant(s) who did not perform their part of the contract and didnot execute the sale deed though, the plaintiff was ready and willing topay the sale amount. It is submitted that therefore, in view of theconcurrent findings recorded by all the courts below, the High Court hasnot committed any error in passing the decree for specific performanceof the sale agreement.

4.1 It is submitted that therefore, the impugned judgment and orderpassed by the High Court granting relief for specific performance of thesale agreement may not be interfered with by this Court. Reliance is A

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Aalso placed on the decision of this Court in the case of P. D’souza(supra).

5. We have heard learned counsel appearing on behalf of therespective parties at length.

6. At the outset, it is required to be noted that as such there areBconcurrent findings of facts recorded by all the courts below on thereadiness and willingness of the plaintiff to perform his part of the contractwhich are not required to be interfered with by this Court in exercise ofpowers under Article 136 of the Constitution of India. However, at thesame time, what is required to be considered is whether in the facts andCcircumstances of the case, the High Court is justified in overturning thejudgment(s) of the learned Trial Court as well as the First AppellateCourt refusing to pass the decree for specific performance of the saleagreement?

6.1 At the outset, it isrequiredto be noted that as such whileDallowingthe second appeal and overturning the judgment(s) and order(s)passed by the learned Trial Court as well as the First Appellate Court,the High Court has not framed the substantial question of law, which isrequired to be framed under Section 100 of the CPC.

6.2 Even otherwise on merits also looking to the terms and conditionsEstipulated in the sale agreement the High Court has erred in passing thedecree for specific performance which was refused by the learned TrialCourt as well as the First Appellate Court. The relevant clause in thesale agreement reads as under: - “2. That if the 2[nd] party fails to pay the balance amount withinFstipulated time, the advance will be forfeited and if the first partyfail or refuse to execute the sale deed and other necessarydocument in favour of the purchaser or in the name of his nomineeswithin the stipulated time, the seller will be responsible to pay thedouble of the amount given as advance.”

6.3 Thus, as per clause 2 of the sale agreement, if the secondGparty fails to pay the balance amount within stipulated time, the advancewill be forfeited and if the seller fail or refuse to execute the sale deedand other necessary document in favour of the purchaser/buyer or inthe name of his nominees within the stipulated time, the seller will beresponsible to pay double the amount given as an advance.Therefore,H

on failure on the part of the seller to execute the sale deed within thestipulated time, the purchaser/buyer shall be entitled to the double of theamount given as an advance. It cannot be disputed that the plaintiffbeing a party to the agreement to sell is bound by the terms and conditionsstipulated in the sale agreement. Therefore, on true interpretation ofclause 2 of the sale agreement, the learned Trial Court as well as theFirst Appellate Court as such rightly refused to pass the decree for specificperformance of the sale agreement and rightly passed the decree forrecovery of Rs. 4 lakhs being double the amount given as an advancewhich as such was in consonance with the clause 2 of the sale agreement.

6.4 An identical question came to be considered by this Court inthe case of P. D’souza (supra) and after considering the earlier decisionof this Court in the case of M.L. Devender Singh Vs. Syed Khaja(1973) 2 SCC 515, this Court observed and held that where the sumnamed is an amount the payment of which may be substituted for theperformance of the act at the election of the person by whom the moneyis to be paid or the act done, the Court may refuse to pass the decree forspecific performance. In the present case, the condition specificallystipulates that in case of failure on the part of the seller to execute thesale deed within the stipulated time the buyer shall be entitled to doublethe amount given as an advance. Therefore, the sum is specifically namedi.e., double the amount of advance paid. Though, the High Court hasrelied upon the decision in the case of P. D’souza (supra), the aforesaidaspect has not been considered by the High Court, more particularly, theobservations made in paragraph 31 in its true perspective.

7. In view of the above, the High Court has materially erred insetting aside the concurrent judgment(s) of the learned Trial Court aswell as the First Appellate Court refusing to pass the decree for specificperformance and passing the decree for recovery of Rs. 4 lakhs beingdouble the amount of advance paid. Under the circumstances, theimpugned judgment and order passed by the High Court is unsustainable.

8. In view of the above and for the reasons stated above, presentappeal(s) arising out of rejecting the review application and the judgmentand order passed by the High Court in second appeal are allowed.Consequently, order passed in review application and the judgment andorder passed by the High Court in second appeal granting relief forspecific performance of the sale agreementdeserve to be quashed andset aside and is/are accordingly quashed and set aside. Consequently, AB

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Athe judgment and decree passed by the learned Trial Court affirmed bythe First Appellate Court stands restored. The appeal arising out of thedismissal of the cross objection stands disposed of.

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Ankit Gyan

(Assisted by : Abhishek Agnihotri and Aarsh Choudhary, LCRAs)

Appeal disposed of.

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