IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 25TH DAY OF APRIL 2019 PRESENT THE HON’BLE MRS.JUSTICE B.V.NAGARATHNA AND THE HON’BLE MR.JUSTICE H.T.NARENDRA PRASAD R.F.A.No.1550 OF 2011 (SP) BETWEEN:
Mrs. Joyce Severine Rego W/o Felix Vincent Rego Major R/at Galaxy Cottage Rego Compound Near Kudupu Bridge Kudupu Post, Mangalore-577004. …. Appellant (By Sri.P.Karunakar, Advocate) AND Mrs. Gretta Asha D’Silva W/o Alwyn Jossy D’Silva Aged about 31 years Hill Top, Near Garodi Kankanady, Mangalore-577004. … Respondent (By Sri. Saravana, Advocate for Sri. D.R.Ravishankar, Advocate) This RFA is filed under Section 96 of the Code of Civil Procedure against the Judgment and Decree dated: 12.07.2011 passed in OS.No.313/2005 on the file of the II Additional Senior Civil Judge, Mangalore, D.K. Partly decreeing the suit of the plaintiff therein for specific performance and damages, dismissing the counter claim of the defendant therein.
This RFA, having been heard and reserved for orders on 02.04.2019, coming on for pronouncement this day, NARENDRA PRASAD J., delivered the following:
JUDGMENT This regular first appeal is preferred by the defendant under Section 96 of Code of Civil procedure, 1908 challenging the judgment and decree dated 12.07.2011 passed by the II Addl. Senior Civil Judge, Mangalore, Dakshina Kannada, in O.S.No.313/2005 whereby, the Trial Court has decreed the suit partly.
2. For the sake of convenience, parties herein shall be referred to, in terms of their status before the Trial Court.
3. Plaintiff filed the suit against defendant seeking the relief of specific performance directing the defendant to execute and register the sale deed in respect of suit schedule property in favour of the plaintiff or her nominees within the time fixed by the Court and on her failure to register the same through the process of the court and for directing the defendant to pay damages at the rate of Rs.5,000/- per day from the date of suit till registered sale deed is executed in respect of suit schedule property in favour of the plaintiff.
4. The brief facts of the case according to the plaintiff are that defendant is the owner of the suit schedule property. She had purchased the same as per registered sale deed dated 26.12.1994. The defendant agreed to sell the suit schedule property for a total sale consideration of Rs.46.00 lakhs to plaintiff or her nominee. In this connection, a detailed written agreement dated 07.03.2005 was executed between the plaintiff and the defendant. As per the sale agreement dated 07.03.2005, plaintiff had to pay a sum of Rs.5.00 lakhs to the defendant as advance sale consideration. The defendant has acknowledged the same in the sale agreement itself. As per the terms of the agreement, plaintiff had to pay a sum of Rs.20,50,000/- on or before 30.06.2005 and the balance amount of Rs.20,50,000/- had to be paid on or before 31.12.2005. The further case of the plaintiff is that she was ready to pay balance sale consideration amount as per the sale agreement but the defendant stated that if the entire amount is paid by plaintiff, defendant will have income tax problems and she requested the plaintiff to wait till her husband returned to India in the month of August 2005. When things stood thus, plaintiff surprisingly received a caveat from defendant on 21.07.2005. After receipt of the caveat plaintiff tried to contact the defendant to enquire about the reason as to why defendant had lodged the caveat petition. But the defendant avoided the query. Hence, she got issued a legal notice dated 25.07.2005. In the legal notice, plaintiff specifically stated that she was ready and willing to pay the entire sale consideration and called upon the defendant to fix the date for execution of the sale deed. Defendant issued reply notice dated 28.07.2005. Plaintiff finally chose to issue a final notice dated 07.09.2005 calling upon the defendant to intimate the date as to when she was ready and willing to execute the sale deed. Even to the said legal notice, defendant issued a frivolous reply dated 20.09.2005. Under those circumstances, plaintiff had no other option but to institute the suit. Hence, plaintiff filed the suit in O.S.No.313/2005 before the II Additional Senior Civil Judge, Mangalore.
5. In response to the suit summons, the defendant appeared through her advocate and filed her written statement contending that the allegations made by the plaintiff in the plaint are false and frivolous and she sought for dismissal of the suit. It is further contended that she is the absolute owner of the immovable property and plaintiff and her husband being in good terms with defendant’s family, the plaintiff came forward to purchase suit schedule property for a total consideration of Rs.46.00 lakhs. As per the sale agreement, plaintiff agreed to pay a sum of Rs.20,50,000/- on or before 30.06.2005 and a further sum of Rs.20,50,000/- on or before 31.12.2005. It is further contended that as per Clause 10 of the sale agreement, actual possession of the residential building bearing Door No.2-155/2, which is consisting of six acres of land would be given to the plaintiff at the time of registration of the sale deed. Further case of the defendant is that her husband had started a confectionary business in the name and style of ‘Phoenix Confectionary’ at Kuwait on 23.06.2005, with a fond hope that plaintiff would make payment on or before 30.06.2005 as agreed. Plaintiff however failed to discharge the terms and conditions of the sale agreement dated 07.03.2005 and failed to pay a sum of Rs.20,50,000/- on or before 30.06.2005. In view of non-compliance with the conditions in the sale agreement and on account of failure to discharge the terms of the sale agreement dated 07.03.2005 by the plaintiff, sale agreement dated 07.03.2005 had been automatically cancelled and advance sale consideration of Rs.5.00 lakhs paid by the plaintiff has been forfeited by the defendant. It is the further case of the defendant that plaintiff had no money to pay the balance amount as per the agreement dated 07.03.2005 and she is not ready and willing to perform her part of the contract. Hence, he sought for dismissal of the suit.
6. On the basis of the aforesaid pleadings, the Trial Court raised the following issues and additional issues for its consideration:
Issues “1) Whether the plaintiff proves that as per the agreement she has taken possession of the plaint schedule property except building bearing D.No.2-155/2 carried out vast developmental work?
2) Whether the plaintiff proves that she has been always ready and willing to pay the sum of Rs.20,50,000/- on or before 30.06.2005 to the defendant?
(as per order dated 1.8.2006 the issue Nos. 1 and 2 are deleted) 3) Whether the plaintiff proves that she is always ready and wiling to perform her part of contract?
4) Whether the defendant proves that she is always ready and willing to perform her part of contract?
5) Whether the plaintiff is entitled for reliefs as prayed for?
6) What order or decree?
Addl. Issue dated 1.8.2006:
1) Whether the defendant proves that the time is the essence of the contract?
Additional Issues dated 13.12.2006:
1) Whether the defendant proves that plaintiff is liable to pay the loss caused to the defendant on account of damage of Rs.4,00,000/- caused to the house bearing Door No.2-155?
2) Whether the defendant proves that plaintiff has removed several jack fruit trees of the plaint schedule property?
3) Whether the defendant proves that plaintiff has removed about 1500 yielding areaca trees of the plaint schedule property?
4) Whether the defendant proves that she is entitled for counter claim as prayed for?
7. In order to substantiate her case, plaintiff examined herself as P.W.1 and examined another witness as P.W.2. She produced sixteen documents which were marked as Ex.P.1 to Ex.P.16. Defendants examined seven persons and thirty four documents were produced which were marked as Ex.D.1 to Ex.D.34. On the basis of the said evidence, the Trial Court answered issue No.3 in the affirmative, issue No.4 in the negative, issue No.5 partly in the affirmative, additional issue dated 13.12.2006 in the negative, additional issue Nos.1, 2, 3 and 4 dated 13.12.2006 in the negative and decreed the suit of the plaintiff partly with costs in the following terms:
“The suit of the plaintiff is partly decreed with costs.
The counter claim of the defendant is hereby dismissed.
The defendant is hereby directed to execute the sale deed in the name of the plaintiff or her nominees with respect to the plaint schedule property within 60 days from the date of this order.
On the failure to do so by the defendant, the plaintiff can get the sale deed executed and registered and get the possession of the same through the process of this Court on payment of necessary expenses.
The defendant is also hereby directed to pay damages at the rate of Rs.5,000/- per year from the date of filing of this suit till the date of executing the sale deed in the name of the plaintiff within 60 days from the date of this order.“ 8. Being aggrieved by the judgment and decree of the trial court dated 12.07.2011, defendant has preferred this appeal.
9. We have heard learned counsel for the respective parties and perused the materials on record as well as original record.
10. Sri R.Karunakar, learned counsel for the appellant - defendant contended that defendant has executed a sale agreement dated 07.03.2005 for a total consideration of Rs.46.00 lakhs. On the date of the sale agreement itself, plaintiff had paid a sum of Rs.5.00 lakhs to the defendant as advance sale consideration and as per the terms of the sale agreement, plaintiff had to pay a sum of Rs.20,50,000/- on or before 30.06.2005 and Rs.20,50,000/- on or before 31.12.2005. As per the terms of the sale agreement, plaintiff had to discharge her part of the contract. Since plaintiff had not paid the amounts in terms of the contract, the contract has been automatically cancelled and advance sale consideration of Rs.5.00 lakhs which had been paid to the plaintiff had been forfeited. He further contended that plaintiff has failed to prove her readiness and willingness to perform her part of the contract and further the evidence on record would clearly go to show that plaintiff had no money to pay the balance amount as contended by her. The Trial Court, without considering this aspect of the matter has erred in answering issue No.3 in favour of the plaintiff. He further contended that the Court below has erred in coming to the conclusion that plaintiff was always ready and willing to perform her part of the contract. The Trial Court has erroneously appreciated the evidence on record, even though the documents produced by the plaintiff itself show that she was not ready and willing to perform her part of the contract. He further contended that Court below has failed to appreciate the evidence of DW.4 to DW.6 with regard to the amounts lent to the defendant’s husband. The Court below has also erred in drawing an adverse inference regarding the financial capacity of husband of the defendant.
11. Per contra, Sri Saravana, learned counsel for respondent – plaintiff contended that defendant had agreed to sell suit schedule property for a total sale consideration of Rs.46.00 lakhs. As per the sale agreement, plaintiff had paid a sum of Rs.5.00 lakhs to the defendant as an advance sale consideration and defendant had acknowledged receipt of the same. As per the sale agreement, plaintiff was ready and willing to perform her part of the contract and she was always been ready and willing to pay a sum of Rs.20,50,0000/- on or before 30.06.2005 and the balance amount of Rs.20,50,000/- on or before 31.12.2005. But defendant has requested the plaintiff not to pay till her husband returned to India in the month of August 2005 as if the entire amount was paid, she would have to pay income tax on it and she would have to pay a huge amount as tax on capital gain. He further contended that plaintiff has produced Exs.P10, P11 and P12 to show that she had amounts in the bank account. The Tribunal, after considering the oral and documentary evidence has rightly decreed the suit. Hence, he sought for dismissal of the appeal.
12. Having heard learned counsel for the parties and on perusal of the materials on record, the following points would arise for my consideration;
“1) Whether the plaintiff has pleaded and proved that she was ready and willing to perform her part of the contract in fulfillment of statutory requirement under Section 16 of the Specific Relief Act, 1963?
2) Whether the finding of the trial court that the plaintiff had proved her case and therefore she was entitled for a decree of specific performance, calls for interference?
3) What order?
13. It is not in dispute that defendant is the absolute owner of the suit schedule property. It is also not in dispute that defendant had executed the sale agreement dated 7.3.2005 in favour of the plaintiff for a sale consideration of Rs.46.00 Lakhs. As per the sale agreement, plaintiff had paid a sum of Rs.5.00 Lakhs to the defendant as advance sale consideration and defendant had in fact acknowledged the same in the agreement itself. It is also not in dispute that as per the terms of the agreement, plaintiff had to pay a sum of Rs.20,50,000/- on or before 30.6.2005 and balance amount of Rs.20,50,000/- on or before 31.12.2005. Since, the plaintiff has not paid the balance sale consideration amount as per the terms of the sale agreement, defendant had filed the caveat petition. After receipt of the same, plaintiff issued a legal notice dated 21.7.2005 stating that she was ready and willing to pay entire sale consideration and called upon the defendant to fix the date for execution of the sale deed and stated that the plaintiff was always ready and willing to perform her part of contract. However, the defendant issued a reply dated 25.7.2005 stating that plaintiff was not ready and willing to pay the entire sale consideration as per the terms of the contract. Plaintiff got issued one more notice dated 7.9.2005 calling upon the defendant to intimate the date for execution of the sale deed and the plaintiff expressed her willingness to pay the entire balance sale consideration amount. Pursuant to the notice, defendant sent his reply dated 20.09.2005 stating that the plaintiff had failed to discharge the terms of the sale agreement dated 7.3.2005 and hence, the sale agreement was automatically cancelled and advance sale consideration amount of Rs.5,00,000/- had been forfeited. Immediately, after that, plaintiff filed the suit seeking the relief of specific performance of the contract directing the defendant to execute and register the sale deed in respect of the suit schedule property in her favour or her nominee within the time fixed by the court and on failure, to register the same through the process of the court and for directing the defendant to pay damages at the rate of Rs.5,000/- per day from the date of suit till registered sale deed is executed in respect of the suit schedule property in her favour.
14. In support of the contention that plaintiff was ready and willing to perform her part of the contract and that she was and is ready to pay the balance consideration, she produced Ex.P-10, certified copy of deposit extract, Ex.P-11, certified copy of the SRE account and Ex.P-12, statement of account of Silva Enterprises. Ex.P10 bank statement of account of her uncle, Marcel Lobo. Ex.P-11 is the statement of account of Marcel Lobo for the period from 1.7.2004 to 31.12.2005. In the month of April 2005, the balance was Rs.1,51,493/- and in the month of September 2005, the balance was Rs.6,79,371/-. Plaintiff has also produced bank statement of her husband in order to prove that she had the capacity to raise the fund. As per Ex.P12 the amount in the account of plaintiff’s husband as on 28.05.2005 was Rs.24,154.54 and thereafterwards as on 05.10.2005 the balance amount in the account of the plaintiff’s husband, i.e., Silver Enterprises’ Account was a sum of Rs.3,45,636.54. From the aforesaid documents, on which plaintiff has relied, it is clear that neither on the date of sale agreement, nor on the expiry of the terms of the contract or on the date of filing the suit, plaintiff had requisite funds to pay the balance sale consideration of Rs.41,00,000/- so as to get the sale deed executed in her favour. Moreover, plaintiff has not produced details of her bank account. Marcel Lobo, uncle of the plaintiff whose bank account extracts are at Exs.P10 and P11 has not been examined to prove that amounts so mentioned in the account would be made available to the plaintiff to pay the balance sale consideration. All these documents do not demonstrate that plaintiff had the requisite funds to pay the balance sale consideration of Rs.41,00,000/- and get the sale deed executed by the defendant in her favour.
15. As per Section 16 of the Specific Relief Act, 1963, plaintiff has to plead and prove her readiness and willingness to perform her part of the contract. Section 16 of the Act reads as under:
“16. Personal bars to relief.—Specific performance of a contract cannot be enforced in favour of a person— (a) who would not be entitled to recover compensation for its breach; or (b) who has become incapable of performing, or violates any essential term of, the contract that on his part remains to be performed, or acts in fraud of the contract, or wilfully acts at variance with, or in subversion of, the relation intended to be established by the contract; or (c) who fails to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than terms the performance of which has been prevented or waived by the defendant.
Explanation.—For the purposes of clause (c),— (i) where a contract involves the payment of money, it is not essential for the plaintiff to actually tender to the defendant or to deposit in court any money except when so directed by the court;
(ii) the plaintiff must aver performance of, or readiness and willingness to perform, the contract according to its true construction.”
16. With regard to readiness and willingness, this Court in the case of SMT.CHANDRAKANTHAMMA & OTHERS vs. B.RAMAKRISHNAIAH reported in (2016) I AIR Kant R 273 has followed the judgment of the Hon’ble Apex Court in the case of COROMANDEL INDAG PRODUCTS PRIVATE LIMITED v. GARUDA CHIT AND TRADING COMPANY PRIVATE LIMITED AND ANOTHER reported in (2011) 8 SCC 601. At para 20 of which judgment, it is held as under :
“20. It is also relevant to point out the stand of the parties as reflected in their pleadings and evidence. In terms of Section 16(c) of the Specific Relief Act, 1963, it is incumbent on the party, who wants to enforce the specific performance of a contract, to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract. The Explanation appended to clause (c) makes it clear that if a contract involves the payment of money, it is not essential for the plaintiff to actually tender to the defendant or to deposit in court any money except when so directed by the court. However, the plaintiff must aver performance of or readiness and willingness to perform the contract according to its true construction.”
It is further held in the case of SMT.CHANDRAKANTHAMMA (supra) as follows:
“20. Therefore, not only the plaintiff has to aver his readiness and willingness, he must prove his readiness and willingness by such acceptable evidence on record. The Explanation makes it clear, in proving his readiness and willingness, it is not essential for the plaintiff to actually tender to the defendant or to deposit in Court any money. But nonetheless, when he is called upon to prove in a Court of law his readiness and willingness, he must prove by acceptable evidence that on the day he was expected to pay the balance sale consideration agreed upon, either he had ready funds or from where he would have raised the funds as on that day. Raising of the funds or source of funds subsequent to the date of the suit would not prove the plaintiff’s readiness and willingness to perform his part of the contract in terms of the contract agreed upon. In this connection, this Court had an occasion to review the entire case law on the point and in the case of SMT. PADMINI RAGHAVAN v. MR. H.A. SONNAPPA, SINCE DEAD BY HIS L.Rs AND OTHERS reported in ILR 2014 Kar. Pg. 233 held as under :
“51. Thus, Section 16(c) of Act envisages that plaintiff must plead and prove that he had performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than those terms the performance of which has been prevented or waived by the defendant. The continuous readiness and willingness on the part of the plaintiff is a condition precedent to grant the relief of specific performance. This circumstance is material and relevant and is required to be considered by the Court while granting or refusing to grant the relief. If the plaintiff fails to either aver or prove the same, he must fail. The basic principle behind Section 16(c) read with Explanation (ii) is that any person seeking benefit of the specific performance of contract must manifest that his conduct has been blemishless throughout entitling him to the specific relief. The provision imposes a personal bar. The Court is to grant relief on the basis of the conduct of the person seeking relief.
52. Thus in a suit for specific performance, the plaintiff should not only plead and prove the terms of the agreement, but should also plead and prove his readiness and willingness to perform his obligations under the contract in terms of the contract. The continuous readiness and willingness on the part of the plaintiff is a condition precedent to grant the relief of specific performance. This circumstance is material and relevant and is required to be considered by the Court while granting or refusing to grant the relief. If the plaintiff fails to either aver or prove the same, he must fail. It is indisputable that in a suit for specific performance of contract, the plaintiff must establish his readiness and willingness to perform his part of the contract. The readiness and willingness on the part of the plaintiff to perform his part of contract would also depend upon the question as to whether the defendant did everything which was required of him to be done in terms of the agreement for sale. The question as to whether the onus was discharged by the plaintiff or not will depend upon the facts and circumstances of each case. No straitjacket formula can be laid down in this behalf. To adjudge whether the plaintiff is ready and willing to perform his part of the contract, the Court must take into consideration the conduct of the plaintiff prior and subsequent to the filing of the suit along with other attending circumstances. The amount of consideration which he has to pay to the defendant must of necessity be proved to be available. Right from the date of the execution till the date of the decree, he must prove that he is ready and has always been willing to perform his part of the contract. AS stated, the factum of his readiness and willingness to perform his part of the contract is to be adjudged with reference to the conduct of the party and the attending circumstances. The Court may infer from the facts and circumstances whether the plaintiff was ready and was always ready and willing to perform his part of contract.
53. Readiness and willingness refer to the state of mind and conduct of the purchaser, as also his capacity and preparedness on the other. One without the other is not sufficient. There is a distinction between readiness to perform the contract and willingness to perform the contract. By readiness may be meant the capacity of the plaintiff to perform the contract which includes his financial position to pay the purchase price. In so far as willingness is concerned, it reflects the mental attitude of the plaintiff to part with or pay the balance sale consideration agreed to be paid. If there are any reservations without any justification, or it is made conditional on the happening of any event which is not agreed upon, it shows his unwillingness to perform his part of the contract. The obligation imposed by Section 16 is upon the Court not to grant specific performance to a plaintiff who has not met the requirements of Clauses (a), (b) and (c) thereof. A Court may not, therefore, grant to a plaintiff who has failed to aver and to prove that he has performed or has always been ready and willing to perform his part of the agreement the specific performance whereof he seeks. There is therefore, no question of the plea being available to one defendant and not to another. It is open to any defendant to contend and establish that the mandatory requirement of Section 16(c) has not been complied with and it is for the Court to determine whether it has or has not been complied with.”
21. Therefore, it is clear, in order to prove his readiness and willingness, the amount of consideration which the plaintiff has to pay to the defendants, must of necessity be proved to be available right from the date of the execution of the agreement till the date of the decree. He must prove that, he is ready and has always been willing to perform his part of the contract. The factum of his readiness and willingness to perform his part of the contract has to be adjudged with reference to the conduct of the parties and the attendant circumstances.”
17. Therefore, it is clear that readiness and willingness cannot be considered in a straitjacket formula, it has to be determined on the entire facts and circumstances of each case; the intention and conduct of the parties concerned and all other attendant considerations. In order to seek enforcement of contract plaintiff has to aver and prove his readiness and willingness to perform his part of the contract. Readiness and willingness are different and distinct. Even if a party to the contract is ready and has the requisite funds he may not be willing to perform his part of the contract and vice versa. Thus both readiness as well as willingness have to be established by the plaintiff on whom the burden is cast in a suit for specific performance of an agreement.
18. After the amendment of Section 16(c) of Specific Relief Act, 1963 the Hon’ble Supreme Court, in the case of MEHBOOB-UR-REHMAN (DEAD) THROUGH LRS. Vs.
AHSANUL GHANI (Civil Appeal No.8199/2009 disposed of on 15.2.2019) has held as under:
“13. It remains trite that the relief of specific performance is not that of common law remedy but is essentially an exercise in equity. Therefore, in the Specific Relief Act, 1963, even while providing for various factors and parameters for specific performance of contract, the provisions are made regarding the contracts which are not specifically enforceable as also the persons for or against whom the contract may be specifically enforced. In this scheme of the Act, Section 16 thereof provides for personal bars to the relief of specific performance. Clause (c) of Section 16 with the explanation thereto, as applicable to the suit in question, had been as follows:-
"16. Personal bars to relief.- Specific performance of a contract cannot be enforced in favour of a person-
(a) *** *** *** (b)*** *** *** (c) [who fails to aver and prove] 1 that he has performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than terms the performance of which has been prevented or waived by the defendant.
Explanation:--For the purpose of clause (c),---
(i) where a contract involves the payment of money, it is not essential for the plaintiff to actually tender to the defendant or to deposit in court any money except when so directed by the court;
(ii) the plaintiff [must aver]2 performance of, or readiness and willingness to perform, the contract according to its true construction.”
14. Though, with the amendment of the Specific Relief Act, 1963 by Act No. 18 of 2018, the expression “who fails to aver and prove” is substituted by Act No. 18 of 2018, the expression “who fails to aver and prove” is substituted by the expression “who fails to prove”. By the same Act No. 18 of 2018, the expression “ must aver” is substituted by the expression “must prove” expression “who fails to prove” and the expression “must aver” stands substituted by the expression “must prove” but then, the position on all the material aspects remains the same that, specific performance of a contract cannot be enforced in favour to the person who fails to prove that he has already performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than the terms of which, the performance has been prevented or waived by the other party. As per the law applicable at the relevant time, it was incumbent for the plaintiff to take the specific averment to that effect in the plaint. Of course, it was made clear by this Court in several decisions, that such requirement of taking the necessary averment was not a matter of form and no specific phraseology or language was required to take such a plea. However, and even when mechanical reproduction of the words of statue was not insisted upon, the requirement of such pleading being available in the plaint was neither waived nor even whittled down. In the case of A. Kanthamani v. Nasreen Ahmed: (2017) 4 SCC 654, even while approving the decree for specific performance of the agreement on facts, this Court pointed out that the requirement analogous to that contained in Section 16(c) of the Specific Relief Act, 1963 was read in its forerunner i.e., the Specific Relief Act, 1877 even without specific provision to that effect. Having examined the scheme of the Act and the requirements of CPC, this Court said,- vide Syed Dastagir v. T.R.Gopalakrishna Setty: (1999) 6 SCC 337; and Aniglase Yohannan v. Ramlatha and Ors.: (2005) 7 SCC 534, “Therefore, the plaint which seeks the relief of specific performance of the agreement/contract must contain all requirements of Section 16 (c) read with requirements contained in Forms 47 and 48 of Appendix ‘A’ CPC”
19. By a plain reading of the above provisions, it is very clear that plaintiff has to prove readiness and willingness to pay the balance sale consideration amount. In the instant case, it is very clear that the plaintiff was not having sufficient funds to pay the balance sale consideration amount to the defendant and get the sale deed executed in her favour. Ex.P-10 Bank statement of her uncle Marcel Lobo has been produced to show that in his account, he has balance of Rs.6,79,371/- only as on September 2005, but he has not been examined to prove that the amount available at his account could be made available for payment of balance sale consideration. Except that, plaintiff has not produced any other document to prove the fact regarding readiness and willingness to perform her part of the contract for purchasing the suit property. Unless the plaintiff proves that as per the prescribed provisions of Section 16(c) of the Act, courts get no jurisdiction to decree the suit for specific performance.
20. We have perused the judgment of the trial Court.
The trial Court was not right in observing that the defendant could not have entered into an agreement with the plaintiff when the plaintiff and her husband had no financial capacity to purchase the suit schedule property and that the defendant had entered into an agreement with the plaintiff without knowing the financial capacity of the plaintiff, which cannot be believed. The trial Court is further wrong in observing that plaintiff’s husband had deposed that he had availed loan from different banks for his business, but the defendant had not proved that he was a defaulter to the banks.
21. The defendant had argued that the plaintiff had no money to an extent of Rs.20,50,000/- in the month of June or before 30/06/2005. The trial Court has also observed that it agreed with the said argument. The trial Court is also not right in observing that the question of readiness and willingness to pay the balance consideration is not of much importance when the lender has parted with possession of property. The inference of the trial Court that the plaintiff was ready and willing to perform her part of the contract by paying the balance amount of Rs.41,00,000/- to the defendant is not based on the evidence on record. The further inference that defendant was not ready to perform her part of the contract is also not correct. The trial Court has also lost sight of the fact that the specific performance of an agreement is a discretionary remedy and that the discretion must be exercised in accordance with law and bearing in mind the facts and circumstances of the case and also the evidence on record.
22. In view of the aforesaid discussion, we find that the trial Court has not exercised its discretion in a judicious manner and based on the evidence on record. Hence, we have no hesitation in holding that the judgment of the trial Court is erroneous. The points are answered accordingly.
23. In that view of the matter, judgment and decree of the Trial Court is not sustainable as it is contrary to law and contrary to legal evidence on record. As such, it is liable to be set aside and is set aside.
24. Accordingly, the appeal is allowed and the judgment and decree dated 12.07.2011 passed by II Addl. Senior Civil Judge, Mangalore, Dakshina Kannada, in O.S.No.313/2005 is hereby set aside.
Parties to bear their respective costs.
Sd/- JUDGE Sd/- JUDGE Cm/DM