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Noting that while the contract for sale was made in 2003, and the amount was in fact deposited in 2010 to a court, the Supreme Court held that such delay would not show readiness or willingness to discharge the aggrieved party's contractual obligations.
The Supreme Court on Tuesday held that depositing of balance consideration after lapse of seven years would not establish a party's readiness to discharge his part of the contract.
In this regard, Court also relied on Umabai v. Nilkanth Dhondiba Chavan where the Top Court speaking through Justice SB Sinha held that deposit of amount in court is not enough to arrive at conclusion that plaintiff was ready and willing to perform his part of contract within meaning of section 16(c) of Specific Relief Act.
These observations came to be made by the Top Court while hearing an appeal filed by one UN Krishnamurthy challenging the judgment of the Madras High Court upholding a decree of specific performance of an agreement for sale of property.
Suit property located in Hosur was agreed to be sold to AM Krishnamurty for a consideration of Rs.15,10,000, out of which sum of Rs.10,001 was paid in advance.
"Where a certain amount has been paid in advance and the balance is required to be paid within a stipulated time, it is for the Plaintiff to show that he was in a position to pay the balance money. The Plaintiff has to prove that he has the money or has alternatively made necessary arrangements to get the money," the top court remarked.
Relying on Section 16 of the Specific Relief Act, 1963, the top court dealt with explanation (ii) to clause (c) of Section 16 which says the plaintiff must aver performance or readiness and willingness to perform the contract according to its true construction.
In this regard, the top court noted that it may be true that the plaintiff had deposited the balance sale consideration in court in 2010, but it could not be ignored that such deposit was made by him seven years after March 2003, being the date by which the sale had to be concluded.
No evidence has been adduced on behalf of the plaintiff as to how he was in a position to pay or make arrangements for payment of the balance sale consideration within time, the bench added.
Court also noted that the suit property was located in the industrial town of Hosur located about 30/40 km. from Bengaluru and it was obliged to take judicial notice of the phenomenal rise in the price of real estate in Hosur.
To this, the Court said,
"...the Plaintiff had only paid an insignificant amount of Rs.10,001/- as advance when the consideration was Rs.15,10,000/-. Having paid an insignificant amount the Plaintiff was not entitled to discretionary equitable relief of Specific Performance, as observed by this Court in Saradamani Kandappan v. S. Rajalakshmi."
A division bench of Justice Indira Banerjee and Justice Hrishikesh Roy further remarked that although the Plaintiff may be willing to perform his part of the contract, he was not ready with funds and was possibly trying to buy time to discharge his part of the contract.
Accordingly, while allowing the appeal, the Court opined that the plaintiff was not entitled to relief of specific performance.
Case Title: U.N. KRISHNAMURTHY (SINCE DECEASED) THR. LRS. vs. A. M. KRISHNAMURTHY
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