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Synopsis

Supreme Court last month set aside a decree enforcing an agreement to sell entered into 1986 upon a suit filed in 1999, saying inaction on the part of the vendee during his life time for a period of thirteen years certainly goes against him.

A bench of Justices Vikram Nath and Rajesh Bindal said the action for enforcement of agreement to sell dated September 24, 1986 should have been taken within limitation from that date instead of waiting indefinitely by paying a meagre amount of Rs 5,000 as earnest money out of total sale consideration of Rs 55,000. 

In the case, the suit filed by Ramesh Kumar and others was decreed by the trial court in 2007. This order was upheld in first appeal and the second appeal.

Defendant Hazari Lal (dead) through legal representatives challenged the Allahabad High Court's judgement passed in second appeal and contended they purchased the house no 259 and 260 at Sadar Bazar in Allahabad from owners in 1999.

Thereafter, the respondents filed a civil suit in July 1999, praying for specific performance of agreement to sell dated September 24, 1986 executed by the vendors-defendants no 1 to 4, in favour of the respondents and challenging the sale deed dated July 06, 1999 executed in favour of the appellant. 

In terms of the agreement to sell allegedly executed by the vendors in favour of the respondents, three properties bearing House nos 258, 259 and 260, situated at Sadar Bazar, Allahabad were agreed to be sold to the respondents for a total sale consideration of Rs 55,000. Earnest money of Rs 5,000 was paid. It was agreed that the sale deed will be registered after getting permission from the Ceiling Department. 

The vendee was to be informed by the vendors after getting permission from the Ceiling Department. Six months’ time was granted for getting the sale deed registered on payment of balance sale consideration after information of permission is given. The contention is that no permission as such was required for getting the sale deed registered from the Ceiling Department and in fact the vendors had never applied for that. 

As the vendee, namely, Mewa Lal (predecessor-in-interest of the respondents) had failed to get the sale deed registered in more than twelve years or take any action against the vendor to comply with the terms of agreement, the vendors sold House Nos 259 and 260 to the appellant, who claimed he was tenant in the two houses. 

The respondents, on their part, said there is no error in the judgments and decrees passed by the courts below.

They said the agreement to sell executed by the vendors in favour of the predecessor-in-interest of the respondents was well within the knowledge of the appellant and despite that he got the sale deed registered with reference to two houses bearing nos 259 and 260. He has not been able to prove on record that there was proper verification of the title of the vendor and there is no error in the judgment and decree passed by the Trial Court, as upheld upto the High Court. There was no delay in filing of the suit as it was to be filed within six months from the date intimation regarding permission from Ceiling Department was given. The same was never conveyed. However, the counsel had no answer to the argument of the appellant that no such permission was required, the court noted.

"The argument raised by the counsel for the appellant that no permission as such was required from the Ceiling Department was not refuted by counsel for respondents no 1 to 10. The fact also remains that in case such a permission was required, and vendors had not taken any steps within reasonable period after execution of agreement to sell on 24.09.1986, the vendee should have taken remedial measures and not waited for thirteen long years," the bench said. 

Case Title: HAZARI LAL (DEAD) THR. LRS. vs. RAMESH KUMAR & OTHERS