Vs. Jagdish Pandit & Ors  INSC 146 (10 February 1997)
RAMASWAMY, G.T. NANAVATI
O R D E
appeal by special leave arises from the judgment of the High Court Patna, made
on May 23, 1996 in appeal from appellate decree No.
135 of 1982.
admitted facts are that the appellant had sold the suit property by a
registered conveyance dated 21.2.1969 with a contemporaneous agreement of reconveyance
for a consideration of Rs. 4,000/-. The appellant had filed the suit on April 7, 1975 for specific performance of reconveyance
of the property. The Courts below had dismissed the suit on the ground that the
appellant was not ready and willing to perform his part of the contract. The
trial Court as well as the High Court further dismissed on the ground that the
time was the essence of the contract and the appellant had not performed the
contract within the stipulated time and, therefore, the suit is barred by
question, therefore, is : whether the view taken by the trial Court and the
High Court that the time is the essence of the contract is correct in law? No
doubt, the High Court has framed the point in paragraph 8 of the judgment and
recorded the finding that the time was the essence of the contract. It is an
admitted position that the plea was not specifically raised, though it was
stated in the written statement that the appellant had not performed his terms
of the contract within time. Admittedly, no issue was raised in this behalf.
The question, therefore, is:
the High Court would be justified in coming to the conclusion that the time was
the essence of the contract? It is now well settled legal position that in the
matter of enforcement of the agreement or agreement of reconveyance, time is
not always the essence of the contract unless the agreement specifically
stipulates and there are special facts and circumstances in support thereof. It
must be specifically pleaded and issue raised so that the other party has a
right to lead evidence. There is no express plea in in the written statement
nor any issue raised in that behalf. Consequently, there was no opportunity to
the appellant to aduce rebuttal evidence that time was not the essence of the
Court in Smt. Indira Kaur & Ors. vs. Sheo Lal Kapoor [(1988) 2 SCC 488] in
paragraph 6 held as under.
the question whether the time is of the essence of the contract or not we are
satisfied that the High Court was in error in allowing the respondents to raise
this question in the absence of specific pleadings or issues raised before the
trial court and when the case of time being the essence of the contract was not
put forward by the respondent in the trial court.
from the absence of pleadings we do not find any basis for the plea of the
respondents in the trial court. Apart from the absence of pleadings we don not
find any basis for the plea of the respondents that the time was of the essence
of the contract." This Court held that the plea cannot be raised, for the
first time, in the High Court when it is not a matter of pleading or issue in
that behalf. We find that the same ratio applies to the facts in this case.
Accordingly, the finding that the time was the essence of the contract and
non-suiting the appellant on that finding is clearly in error.
next question is : whether the appellant was ready and willing to perform his
part of the contract? In that behalf, all the Courts have found that the
appellants was not ready and willing to perform his part of the contract and an
inference has been drawn in support of the finding from the non-production of
the Bank Pass-book. It is seen that though he has not produced the passbook, it
is not the plea of the respondent that she had no capacity to pay the amount.
She established that she has a substantial money to pay the amount. Under these
circumstances, it would be unlikely that the appellant would have failed to
offer the amount before coming to the Court for the specific performance. It is
seen that the last day of the limitation under the contract was February 20, 1973 and the suit was filed on April 7, 1975 within three years under Article 54
of the Schedule to the limitation Act. The courts below were wrong in coming to
the conclusion that the appellant had not tendered the amount to the
respondent. It is seen that in the evidence of the plaintiff (PW-1), it is
stated that he was willing and, in fact, he had offered a sum of Rs. 4,500/-.
On the other hand, another witness (PW-3) has stated that he has offered to pay
a sum of Rs. 4,000/-. On this minor discrepancy of Rs. 500/-, the court below
was not right in disbelieving the entire evidence.
material question is: whether the appellant had capacity to pay the money as
offered. On this aspect, there is no consideration by either of the courts.
Under these circumstances, the courts below were in error in reaching the
conclusion that the appellant was not ready and willing to perform her part of
the contract. As held earlier, there is no dispute on the capacity of the appellant
to pay back Rs. 4,000/- the consideration paid under the conveyance executed in
favour of the respondent. When we put the question to the learned counsel for
the appellant as to what amount his client is willing to pay since the property
is required to be reconveyed under the agreement, the learned counsel, in
fairness, has stated the appellant is willing to pay a sum of Rs. 40,000/- in
lump sum. We think that the offer is very fair. Under these circumstances, even
if the learned counsel for the respondent was not willing to accept, but in our
considered view, we think that the ends of justice and equity would require and
be met by directing the appellant to deposit a sum of Rs. 40,000/- in the trial
Court within a period of six months from today. The appellant on so depositing,
the respondent is directed to produce the title deeds before the Court and reconvey
the property. In case the respondent refuses to produce the document of
conveyance executed in his favour dated 21.2.1969 as directed earlier, the
trial Court is directed to have the deed of reconveyance executed in terms of
the sale deed dated 21.2.1969. In that event, the appellant is entitled to the
costs of the execution and also the cost of the stamp duty and registration fee
of the sale deed.
appeal is accordingly allowed. But, in the circumstances, without costs.