K.R. Gopivallabha Iyengar, J.
1. The plaintiff in Original Suit No. 403 of 1962 on the file of the II Additional Munsiff, Belgaum, is the appellant. He filed his suit for specific performance of an agreement for sale. This agreement is dated 20-8-1959 and marked Exhibit 49. His case is that according to the agreement, the sale transaction had to be completed within two months from the date of the agreement. The time was extended by 15 days more i.e., upto 26th October, 1959. On 26th October, 1959, the plaintiff alleges that he waited for the defendants to complete the transaction. But, they did not do so. Therefore, he sent a telegram on 26-10-1959 and followed it up with a letter informing the defendants on the plaintiffs willingness to take the sale-deed and calling upon them to execute the deed. The telegram and the letter did not fetch any reply. But, on 9-11-1959, a telegram marked Exhibit 55 was sent by the defendants stating that the plaintiff did not complete the sale deed and they are not responsible. Thereafter, the plaintiff sent the letter dated 11-11-1959 marked Exhibit 57 requiring the defendants to intimate to him the time and date when the defendants would execute the sale deed. They also complained that the defendants have failed to execute the sale deed though the plaintiff is always willing to take it. The plaintiff called upon the defendants to pass the sale deed and to fix the date and time when and where he should see the defendants to take the sale deed. He also indicated that in the event of failure to comply with the demand, he would file a suit.
The plaintiff got a reply Exhibit 58 stating that he should stop further unnecessary correspondence with the defendant. In spite of waiting for a long time, the defendant has failed to keep up the terms of the contract and execute the sale deed. The plaintiff also says that he has kept the remaining sale price ready and that be is willing and ready to perform his part of the agreement. He mentions that the cause of action for the suit arose on 14-11-1959 when the defendants' letter Exhibit 58 was received asking the plaintiff not to correspond with him any further. The plaintiff therefore, sought the relief for specific performance. In the alternative, he made a prayer that in the event of this Court not being inclined to grant a decree for specific performance, he may be granted a decree for damages amounting to Rs. 4,700/-.
2. The second defendant who has been taking an active part in this agreement has filed a written statement and the 3rd defendant has adopted the same. The other defendants are ex parte. It may be mentioned that the 1st defendant is the widow of one Tuljansa and the defendants 2 to 5 are his sons. Consequent on the death of Tuljansa, the defendants 6, 7 and 8 have also been impleaded to this suit.
3. The defendants do not dispute the execution of the agreement dated 20-8-1959 and also the extension of time as evidenced by the endorsement dated 19-10-1959 of Exhibit 49. The defendants plead that the time was the essence of the contract under the agreement for sale by mutual consent, the time for completion of the contract was extended upto 26-10-1959, all other terms of the agreement continuing as before. It is pleaded that it was agreed amongst the parties that they have to meet at the office of the writer on 27-10-1959 and get the sale deed written by him and that the plaintiff was to pay and purchase general stamp paper and also meet the registration expenses in accordance with the agreement. He was also to pay the balance of the agreed price before the Sub-Registrar and get the document registered. It is further alleged that the defendants waited in the office of the writer and the plaintiff turned up and wanted the document to be executed in favour of the plaintiff's wife and the defendants readily agreed to do the same. After this, the plaintiff left the place and did not turn up on that day. When the defendants returned home, they found a telegram issued by the plaintiff which is marked Exhibit 53. The defendants also state that they have made an application to the Chairman Gram Panchayat Committee as desired by the plaintiff relating to an open space for the purpose of road.
The defendants allege that they were ever ready and willing and earnest to complete the agreed sale transaction before and on 28-10-1959. They stated that as a matter of grace, they extended time for completing the transaction upto 9-11-1959. The defendants also admit having received the letter Exhibit 57 and having replied to the same as per Exhibit 59 on 13-11-1959. The defendants state that the plaintiff never seriously intended to complete the transaction, but merely went on carrying correspondence without any intention to carry out the agreement. They say that the correspondence emanating from the plaintiff was merely a pretence to keep alive the plaintiff's claim and hide his unwillingness to fulfil his part of contract. The defendants plead that the plaintiff is now induced to file the suit as the prices of building sites in the locality have been rising to a considerable extent. He is trying to get a wrongful gain and dishonest advantage by the present false claim. They deny the right of the plaintiff to get specific performance or to damages or to any other relief in this suit.
On the basis of these pleadings, the trial court framed several issues. It is stated by both the parties that the first issue framed by the trial Court is unnecessary. The second issue relates to whether the deceased Tuljansa and defendants 2 to 4 committed breach of contract to execute the sale deed and the fourth issue is whether the plaintiff committed breach of contract as averred by defendants 2 and 3. The third issue is whether the plaintiff is entitled to Specific performance of the sale agreement dated 20-8-1959. The trial Court found in favour of the plaintiff on these issues referred to above. No question of considering the alternative relief arose. As a result of the findings, the trial court decreed the suit. Against this, the contesting defendants 2 to 4 preferred Regular Appeal No. 47 of 1968 on the file of the Civil Judge, Belgaum. The learned Civil Judge set aside the decree of the trial court and allowed the appeal with costs thus dismissing the plaintiffs suit. Against this judgment and decree of the lower appellate court, the plaintiff has preferred this second appeal.
4. Shri S. C. Javali, learned counsel appearing for the appellant, contends that the lower appellate Court has misunderstood the scope of the pleadings and has made out a new case for the defendants. He submits that the lower appellate court has drawn inferences which are not warranted by the proved facts of the case. The learned Judge, 6 is submitted, has not merely made out a new case in regard to breach of contract but also in respect of waiver and abandonment which has not been pleaded. It is further contended that the view taken by the lower appellate court with regard to Section 22 of the Specific Relief Act or the equities involved in the case is erroneous in any event. It was not open to the lower appellate court to take a view different from that taken by the trial court on the discretion exercised by the trial court under Section 22 of the Specific Relief Act. He also complains that the Inferences drawn by the lower Appellate Court for the delay in filing the suit as leading to an abandonment is unwarranted in law.
In support of his contentions, he invites my attention to what the lower appellate court has stated in the earlier part of the judgment setting out the facts of the case and also the points arising for decision. The learned Judge states that:
'It has come in evidence of the parties that in the morning of 26-10-1959 the parties to the agreement met and agreed that on the same day, the plaintiff would get the sale deed executed and Tuljansa and defendants Nos. 2 to 5 would execute the sale deed. So, if it is proved that the plaintiff had been to any fixed place with the required amount and with readiness to get the sale deed executed and Tuljansa and defendants Nos. 2 and 5 did not turn up at that place to execute the sale deed and subsequently also the plaintiff was ever willing to get the sale deed executed, but the said Tuljansa and defendants Nos. 2 to 5 avoided to execute the same, the plaintiff is entitled to a specific performance of the contract.
But if it is established that the plaintiff, did not turn up on 26-10-1959 at the appointed place and did not get the sale deed executed by paying the remaining sale price and purchasing the stamp etc., and thereafter Tuljansa and defendants Nos. 2 to 5 due to the breach committed by the plaintiff, put the contract to an end and the plaintiff by his conduct accepted it, or as alleged by the defendants, made only correspondence to hide fault on his part and throw the blame on the defendants, without any intention to get the sale deed executed, even if it is proved that this is not a fit case, in view of the conduct of the plaintiff, where a decree of specific performance of the contract should be awarded, tie plaintiff cannot succeed.'
In view of this understanding of the pleading, the learned Judge sets out 3 points for decision. It is necessary to quote this in full as elaborate arguments are advanced to indicate that by framing the points for decision in the way in which the learned appellate Court has done, it has actually made out a case which is not set up by the parties nor dealt with by the trial court. The points for decision as set out are:--
(i) Whether Tuljansa and defendants 2 to 6 committed breach of the agreement by avoiding to execute the sale deed on 26-10-1959;
(ii) Whether the plaintiff committed breach of the agreement by not turning up on 26-10-1959 to get the sale deed executed as alleged by the defendants;
(iii) Whether on 13-11-1959 the defendants put the contract to an end due to the alleged breach of agreement by the plaintiff and the plaintiff by his conduct accepted or abandoned the contract and has come out with the suit only after knowing that the price of the plots had gone high;
(iv) Whether the plaintiff is entitled for a decree of specific performance of the agreement.
The contention of the appellant's counsel, as already mentioned, is that by framing these points for decision, the learned Judge has gone beyond the scope of the issues which merely concerned itself with the breach of contract either on the part of the plaintiff or on the part of the defendants without reference to particular date connected with the incident. It was submitted for the respondents that there is no difference between the issues framed in the case and the points for decision as mentioned by the appellate Court. But, it is submitted that the issues framed by the trial court are more comprehensive and include the point for decision as set out by the lower appellate court.
5. It was submitted by the respondent's counsel that it would be immaterial whether the breach was on 26-10-59 or on 13-11-59. The question of breach on a particular date would be irrelevant so long as there is a finding that there is a breach. This finding that there is a breach of contract on the part of the plaintiff is a finding of fact which cannot be interfered with in second appeal. Therefore, it remains to be seen whether the approach made by the lower appellate court in this case is in conformity with law keeping in mind the pleadings of the parties and the issues framed in the case. It appears to me that the learned Judge has proceeded to deal with the whole matter as if the breach of contract occurred on 26-10-59. It is, therefore, that he considers in detail the incidents that took place on 26-10-59 and comes to the conclusion that the plaintiff having failed to turn up on 26-10-1959 has committed a breach of contract, and, therefore, the plaintiff is not entitled to any relief of specific performance. In view of the fact that the plaintiff has committed a breach, the defendant put an end to this transaction vide his letter dated 13-11-1959.
6. The learned Judge observed that after this, the plaintiff neither wrote to him nor made any attempt to get the sale deed executed by offering the remaining particulars, but filed a suit on 20-10-1962, 6 days prior to the expiry of the date after which, the suit will be barred. It appears to me that the pleadings do not support the points for determination as set out by the lower appellate Court. The lower appellate court shrinks the issue framed fay the trial Court and confines it to a particular date. This is on the basis of the written statement that
'It had been agreed that the plaintiff and the defendants were to be met at the office of the writer on 26-10-1959 and get the sale deed written by him and that the plaintiff was to pay etc. ......'
This by itself does not mean that if the plaintiff or the defendants failed to turn up at the fixed place and time, the contract would automatically come to an end. As submitted by the appellant's counsel that meeting on the 26th October, 1959 was only a step in the implementation of the agreement for sale. It was not a term or the contract. If it were a term of the contract; the complexion and the inference to be drawn from the conduct of the parties on 26th October, 1959, would be quite different. That the parties did not think of a meeting fixed for 26-10-1959 as a term or the contract is clear from the fact that subsequent to that date, the defendants kept quiet till 9-11-1959. It is said that the defendants extended the time for fulfilment of the contract till 9-11-1959.
Further in the evidence of the second defendant, he states that 'It is true that Exhibit 57 is by way of reply to the plaintiff's telegram'. Exhibit 57 is dated 9-11-1959 and is said to be a reply to Exhibit 53 dated 26-10-1959 issued by the plaintiff on the evening of 26-10-1959. The plaintiff sent reply as per Exhibit 57 on 11-11-1959. With reference to this, he says
'I did not inform the plaintiff the date or place on which the sale deed was to be executed. Thereafter, the plaintiff was informed by letter dated 13-11-1959. My father did not know English. There was no objection for me to inform the date and place where the sale deed was to be written'.
Obviously the defendants were prepared to fix the time and date as required by the plaintiff in their communication dated 11-11-1959. They did not choose to do so. They sent a reply on 13-11-1959 as per Exhibit 58. He suddenly closed the transaction without any reason. It appears to me that the learned Judge should have considered the case from the point of view whether there was a breach of contract on the part of either the plaintiff or the defendants without confining attention to only what happened on the 26th October 1959. This incidentally, raises the question whether the time fixed in Exhibit 49 was the essence of the contract. Both on facts and in law in this case, time cannot be considered to be the essence of the contract. It is undisputed that the time fixed was 2 months from 20-8-1959 and later extended on the 19th October 1959 upto 26-10-1959. Subsequently, it was extended upto 9th November, 1959, though the defendant says that it is a matter of grace. At any rate, the plaintiff was entitled to get the sale deed executed in his favour within 9-11-1959. In this connection, the learned counsel for the appellant invites my attention to the dedsion reported in Jamshed Khodaram Irani v. Burjorji Dhonjibhai, 43 Ind App 26 = (AIR 1915 PC 83). This decision lays down that an Intention to make time of the essence of the contract must be expressed in unmistakable language. It may be inferred from what passed between the parties before and also after the contract is made. The language of Exhibit 49 does not indicate that time is essence of the contract. The subsequent conduct of the parties which though not conclusive throws light on how the parties understood the agreement. On page 32 (of Ind App) -- (on page 85 of AIR) of the above decision it is observed:--
'A court of Equity will indeed relieve against and enforce specific performance, notwithstanding a failure to keep the dates assigned by the contract; either for completion or for the steps towards completion, if it can do justice between the parties, and if (as Lord Justice Turner said in Roberts v. Berry, (1853-3 De G. M. & G. 284) there is nothing in the 'express stipulations between the parties, the nature of the property, or the surrounding circumstances, which would make it inequitable to interfere with and modify the legal right.'
7. There is the view expressed in Narayana Swami Pillai v. Dhanakoti Ammal : AIR1967Mad220 . In that it is observed, that
'no special circumstance subsisting at the time of the contract has been made out to warrant an inference against the usual presumption that time was not the essence of the contract in an agreement for sale of immovable property.'
No circumstances are made out in this case to indicate that time was the essence of the contract. Though no issue was framed on this question the trial court has discussed this matter and has come to the conclusion that time was not the essence of the contract to perform the suit agreement. Reliance was placed on the observations in Shriram Cotton Pressing Factory v. Narayanaswami : AIR1965Mad352 in which it is stated:
'The question whether time was the essence of the contract is surely a question of law and not of fact, being a legal inference to be derived from the facts. In the instant case having regard to the conduct of the parties in extending the original time fixed for performance, from time to time, time was an essential element, whether time is essential will have to be decided from the nature of the subject-matter of the contract and the object of the contract. Here having regard to the locality the property agreed to be sold is such that its value would necessarily change from time to time when the object of the contract is commercial enterprise, the court is strongly inclined to hold time to be essential.'
In this case there is nothing to indicate that the object of the purchaser was a commercial enterprise. On the other hand it is mentioned that the plaintiff has stipulated from the purchase or the open-site for the purpose or constructing a building. The learned Appellate Judge does not consider this question specifically. But, it is submitted by the respondents counsel that from the fact that the appellate Judge accepts his contention as to what transpired on 26-10-1959 the learned Judge must be understood to have taken the view that the time was the essence of the contract. Taking the facts of the case into consideration, it appears to me that if the learned Judge has taken the view that the time is the essence of the contract he has acted contrary to the evidence on record. Therefore, this case must proceed on the footing that time was not the essence of the contract.
8. The next question that arises for consideration is, whether in this case it could be held that the plaintiff was responsible for the breach of the contract or the defendants were responsible for the same.
9. Though the appellate Court has held that the plaintiff was responsible for the breach of the contract, it cannot be gainsaid that he has come to that conclusion by an erroneous understanding of the case put forward by the parties. Looking at the sequence of events it is clear, that the defendant has abruptly closed the transaction by his letter dated 13-11-1959. Exhibit 58. As I have stated already the agreement fixed 20th of October, 1959 as the date within which the transaction must be completed. On 19th October, 1959, the date was extended by mutual agreement. What happened on 26th of October, 1959, is very important.
10. There are varying versions as to where the parties had to meet to comply with the transaction. D. W. 1 in his evidence states:--
'that it was settled there that the sale deed had to be written on the same day in the office of Manjrekar at Shanivarkoot and all of us agreed to meet them. Accordingly myself, my father and four of my brothers went to Manjrekar's office by about 12 or 12-30 p. m. The plaintiff came there by about 2-00 p. m. and enquired as to whether we are willing to pass a sale deed in his wife's name. We consented. Plaintiff went away saying that he would return soon. But the plaintiff did not turn up there nor his wife. We waited in Manjrekar's office till about 6-30 p. m,; thereafter we returned home.'
It is in consonance with what was stated in the written statement. But, as I stated above, this by itself will not amount to any breach of contract. The next document 6 Exhibit 50. It is dated 1-9-1959. It is a public notice under which the plaintiff informs the public that he has entered into an agreement with the defendant for the purchase of the suit properties. He calls upon those that have interest in the property to see him with evidence of their interest in the same. The next document is Exhibit 51. It is dated 17-10-1959. In this Notice the plaintiff calls upon the defendants to complete the said transaction within 15 days and he also mentions that if the sale deed Is not duly executed, he will be compelled to have recourse to the legal action.
On 19-10-1959 the period for completing the transaction is extended upto 26th October, 1959. This endorsement is made on Exhibit 49 on 19-10-1959. Thereafter the incident of 26-10-1959 took place. On 26-10-1959 the plaintiff sends a telegram which admittedly was received by the defendant in the evening and in that the plaintiff has stated that he was willing to take the sale deed, but the defendants are avoiding and that they would be held responsible for all damages and court costs. This was followed up by a confirmatory letter on 27-10-59. Till 8-11-59 there is no correspondence between the parties.
On 9-11-1959 the defendants' telegram purporting to be a reply to the telegram dated 26-10-1959 saying that they have waited till 9-11-1959, but the sale deed has not yet been completed and they are not responsible. It is curious to note that there is no reference In this telegram to what transpired on 26th instant. It is, however, clear that till the 9th of November, it was open to the plaintiff to get the sale deed from the defendants.
In answer to this under Exhibit 57, the plaintiff calls upon the defendants to pass the sale deed and to inform him as to when, where he should meet to get the sale deed. Ordinarily it will be expected that the defendants would reply to this staring that there has been a breach of the contract on the 26th October, 1959 and therefore nothing more could be done. On the other hand there is no mention of any reason. A cryptic reply is sent on 13-11-1959, asking the plaintiff to stop further unnecessary correspondence with them. This is how the matter ends. The learned Civil Judge has held, that the defendants put the agreement to an end on 13-11-1959 after the plaintiff did not turn up on 26-10-1959 to get the sale deed executed and they waited till 9-11-1959. It appears to me that this conclusion is entirely unwarranted as it is against the documentary evidence in the case.
After 11-11-59 the proper way in which the agreement could have been terminated is by issuing of a notice to the plaintiff calling upon him to complete the transaction within a particular time, failing which the contract will be treated as cancelled. That this is the proper way of terminating the contract is clear from what has been observed in : AIR1967Mad220 that when the contract is for the sale of immoveable property the vendor must give reasonable notice requiring the performance within a definite time.
11. In this case there is no notice exchanged between the parties before the plaintiff filed his suit. So, it appears to me, that the breach of contract if any was on 14-11-1959 as set out in the plaint, after the plaintiff received the unqualified reply of the defendants. Therefore this conclusion leads to the next question, as to whether there was any abandonment or waiver on the part of the plaintiff by the delay in filing the suit six days before the expiry of three years, the period prescribed in the Limitation Act. Though there is no issue on this question, the lower appellate Court came to the conclusion that there are laches on the part of the plaintiff and he has abandoned or waived his claim regarding the sale of the suit lands. The appellate Judge, however, holds that the plaintiff accepted the defendant putting an end to the contract by his conduct in keeping quiet till 29-10-1962. It may however, be observed that there is no plea of abandonment of a waiver.
The appellate court says:
'No doubt the defendants did not use the contract words that they put the contract to an end and the plaintiff accepted it in their written statement, but what they have stated in paragraphs 3 and 5 of the written statement amounts to that.'
This reference is not supported by what has been stated in paragraphs 3 and 5 of the written statement. In paragraph 3, there is no reference to the acceptance by the plaintiff of the repudiation by the defendants. Paragraph 5 of the written statement refers to me rise in price of the building sites in Belgaum and suggested a motive for the plaintiff preferring the present claim, which he characterises as false. Thus, the statement of the learned Judge that the conduct of the plaintiff supports the abandonment on the part of the plaintiff, is clearly erroneous.
This question has been considered by the Supreme Court in Sathyanarayana v. Yelloji Rao : 2SCR221 . In that case their Lordships have observed thus:--
'If the learned Judges meant to lay down that mere delay would amount to abandonment of a right, we find it difficult to agree with them. The decision of the Calcutta High Court in Gostho Behari v. Omiyo Prasad : AIR1960Cal361 , recognised that mere delay was not sufficient to deny the relief of specific performance, but pointed out that though it was not necessary to establish that the plaintiff had abandoned his right, the court may, in view of the conduct of the plaintiff coupled with his delay that had prejudiced the defendant, refuse to give the equitable relief.'
12. In this case the lower appellate court while observing that mere delay is not sufficient to refuse the relief of the specific performance of the contract, states that if the delay coupled with other circumstances indicates that the plaintiff has abandoned the contract then no question of discretion arises. This proposition is correct. The learned Judge mentions that the delay in filing the suit gives rise to the inference of abandonment and secondly the grant of a decree for specific performance could prejudice the defendant and would cause hardship to him. The two reasons that the learned Judge has given are not sustainable in law to deny the relief to the plaintiff.
Sri Javali, learned Advocate for the appellant invited my attention to the decision in Suryaprakasarayudu v. Lakshmi Narasimhacharlu AIR 1914 Mad 462. In this, it is laid down:--
'that mere laches or delay short of the period of limitation is not always evidence of waiver or abandonment of claim, even where it is up to the hilt of the limitation period, that is the ground for refusing specific performance.
Then as regards the finding of the Subordinate Judge that the laches itself amounts to a waiver or abandonment, I think it is an error of law to hold that mere delay amounts to a waiver or abandonment apart from other facts or circumstance or conduct of the plaintiff indicating that the delay was due to a waiver or abandonment of the contract on the part of the plaintiff.'
Therefore, abandonment of the contract cannot be inferred from the mere delay. The second ground that the learned Judge has mentioned, viz., the hardship likely to be caused to the defendants, which can be a reason for inferring that the plaintiff has abandoned the contract, cannot arise in this case. If the defendant was allowed to put up any structure on the property to be sold, the plaintiff keeping quiet, such conduct on the part of the plaintiff would have led to an inference of abandonment or waiver of conduct by him. But no such circumstance exists in this case. The only circumstance we find is that the property value has increased twice or thrice the stipulated value. It may be that if the plaintiff does not insist on the performance of this contract, the defendant may stand to gain by the increase in value. The increase in price is a factor which may induce one party to insist upon the performance of contract because it benefits him, while it may act contrary so far as the other parties are concerned. The circumstance that the plaintiff has delayed in seeking legal action, does not lead to the conclusion that he acquiesced in the alleged termination of the contract. The fact that the plaintiff has not furnished any satisfactory and acceptable reason for the delay in filing the suit cannot disentitle him from seeking relief, provided he is within the limited period prescribed in the Limitation Act
13. It was next contended, that the plaintiff was not ready and willing to perform his part of the contract. This contention is also unfounded and against the evidence on record. In paragraph 2 of the plaint, the plaintiff alleges that he kept the remaining sale price ready at hand from the beginning in order to take the sale deed, but the defendants are purposely evading the same. This allegation has not been specifically denied in the written statement. It is contended, that it is covered by the pleadings. The trial court holds that the plaintiff was ready and willing to perform his contract and it is only the defendants who admittedly put an end to this contract on 13-11-1959. The case of the defendant is that the correspondence of the plaintiff calling upon them to fulfil the contract is only a pretence. This has not been the impression of the defendant himself. The defendant in his cross-examination states that on 27-10-1959 he met the plaintiff on his way to Tilakwadi but refers to no talk regarding sale. In another portion of the cross-examination he states that after 11-11-1959 he had no objection to inform the date and place where the sale deed was to be written. These indicate that the allegation that the conduct of the plaintiff was only a pretence lacks any basis. On the other hand, P. W. 1 in his deposition has stated that he is prepared even now to take the sale deed as per agreement under Exhibit 49. He has not been cross-examined on this point. Therefore, it is clear that there is no basis in the contention.
14. Shi S. K. Venkataranga, Iyengar, learned counsel for the respondent contended, that in view of Section 38 of the Indian Contract Act, the suit is not maintainable. In respect of this argument he relied upon the terms of Exhibit 49. He invited any attention to the default clause which reads as follows:--
'If I neglect to complete the sale transaction in your favour within the said stipulated period, you should deposit in court the remaining amount due to me from you and get the sale transaction completed in your favour through court.'
He pointedly drew my attention to the stipulation that the money should be deposited in court. There is no doubt that the amount is not deposited in court by the plaintiff in the first instance. It appears to have been deposited after the decree was passed by the trial Court. So far as the interpretation of this document is concerned Mr. Javali states that the question of deposit does not arise in the first instance but only when the sale is effected. In view of this, his submission is that he has complied with the conditions of the agreement. It cannot be said that there is no force in the interpretation of Sri Javali. It would be purposeless to deposit the amount in court, when the defendant is flatly refusing to have anything to do with the agreement for sale. The reasonable interpretation that can be placed upon the document is that the balance of sale consideration becomes payable after the right of the plaintiff to get the sale deed is established. iN this contention, the learned counsel invited my attention to two decisions viz., Bhagavantu Layya V. Venkandora, AIR 1941 Mad 484 (FB) and Ismail Bhai v. Adam Osman : AIR1939Cal131 . It was tender by a mortgagor of the mortgage debt which fell short by a small amount. The defendant refused to accept the amount not because it was short, but because the appellant considered that he was entitled to wait for a longer time which meant more interest to him. The refusal of the tender on this ground amounted to waiving any objection that he may have to the amount being short. Therefore, the court held that by refusal of the tender on the ground that it was premature he waived the objection with regard to shortage of the deposit. Therefore, the principle is that if a party to the contract refuses to discharge his obligation he cannot take any objection to the other party failing to fulfil his obligation which is merely the result of the conduct of the First party. The decision in : AIR1939Cal131 , is distinguishable on facts and therefore it is of no assistance to the respondent.
15. The next decision that has been referred to by the learned counsel for the respondent is one in AIR 1957 Trav. Co 216. Even this is distinguishable on facts. There is no circumstance like a letter dated 13-11-1959 as in this case which should make it purposeless to deposit the amount in court when the defendant refused to accept the same. The next argument urged by Sri S. K. Venkataranga lyengar, is that the view taken by the lower appellate court on the exercise of discretion under Section 22 of the Specific Relief Act is one of fact and could not be interfered with in second appeal. The trial Court has taken the view that there are no circumstances in the case to bring it within the scope of Section 22 of the Specific Relief Act, so as to deny the plaintiff the relief of specific performance. The learned Judge while dealing with this aspect of the matter says; if there is delay with other circumstance it should be unfair for the defendant to grant relief on the basis of the contract. The learned Judge has totally misconceived the scope or Section 22 of the Act. Before dealing with this question further, another argument advanced by the respondent's counsel may be adverted to. He refers to Section 22, Clause (2) of tie Specific Relief Act and illustrations (h) and (j). Section 22, clause (2) in particular can refer only to the state of affairs or the conditions that prevailed at the time when the contract was entered into not at any rate later stage. The case reported in : AIR1967Mad220 , supports the proposition that the relevant date is the elate on which the agreement was entered into. They considered the question of increase in price since the date of the agreement and observed:
'But leaving aside these considerations what has to be considered is the fairness of the contract at the time the agreement was entered into. That since the contract prices of properties have gone up is not a matter for consideration.'
In this connection the decision of : 2SCR221 can be referred to while dealing with the scope of Section 22 of the Specific Relief Act. They observed as follows:--
'Under Section 22 of the Specific Relief Act, relief of specific performance is discretionary but not arbitrary; discretion must be exercised in accordance with sound and reasonable judicial principles. The cases providing for a guide to courts to exercise discretion one way or other are only illustrative; they are not intended to be exhaustive. As Article 113 of the Limitation Act prescribes a period of 3 years from the date fixed thereunder for specific performance of a contract, it follows that mere delay without more extending upto the said period cannot possibly be a reason for a court to exercise its discretion against giving a relief of specific performance. Nor can the scope of discretion, after excluding the cases mentioned in Section 22 of the Specific Relief Act, be confined to waiver, abandonment or estoppel. If one of these three circumstances is established, no question of discretion arises, for either there will be no subsisting right or there will be a bar against its assertion.'
In this connection the respondent's counsel referred to the decision in Gomathinayagam Pillal v. Palaniswami Nadar : 1SCR227 . It is quite clear that the said case cannot be of any assistance as the plaintiff therein was not ready and willing to perform his part of the contract. In paragraph 6 of this decision it is stated thus:
'On this part of the case the trial court recorded a clear finding against the respondent that he was at no time ready and willing to perform his part of the contract. The High Court did not consider the effect of this finding upon the claim of the respondent and without expressing dissent with that finding granted a decree for specific performance to the respondent.'
Therefore, this decision cannot be of any assistance to the respondent. Illustrations (h) and (j) deal with cases of hardship which the defendant could not foresee. In the present case no such hardship arises. Hence those illustrations do not assist the respondent.
16. The appellant's counsel further contended that the discretion exercised by the trial court under Section 22 of the Specified Relief Act, should not be interfered with by the appellate court unless it be that the discretion is exercised capriciously or it is unreasonable. In support of this contention the decision in U. P. Co-op. Federation v. Sunder Bros. Delhi : AIR1967SC249 . Though this arose under the Arbitration Act, the principle underlying the said conclusion applies to this case. It lays down, thus:
'Where the discretion vested in the court under Section 84 has been exercised by the lower court, the appellate Court would he slow to interfere with the exercise of their discretion. In dealing with the matter raised before it at the appellate stage, the appellate Court would normally not be justified in interfering with the exercise of the discretion under appeal solely on the ground that if it had considered the matter at the trial stage it may have come to a contrary conclusion. If the discretion has been exercised by the trial court reasonably and in a judicial manner the fact that the appellate court would have taken a different view may not justify such interference with the trial court's exercise of discretion.'
17. Sri Tavali, learned counsel for the defendant (sic--plaintiff?) also invited my attention to the decision to the case in Skinner v. Skinner, AIR 1930 Lah 1004 in which it is observed:
'As provided by Section 22, Specific Relief Act, the grant of specific performance is discretionary with the courts. Where the trial court has exercised this discretion, appellate court will interfere only if it is shown that this discretion has been exercised perversely or against the judicial principles.'
The same is the view taken in : AIR1937All161 , Gain do Devi v. Shanti Swamp. It states:
'The jurisdiction to decree specific performance is discretionary but it must be understood that the discretion of the court is not to be arbitrarily exercised but guided by judicial principles. Where the discretion to grant specific relief is exercised by the Court below, the appellate court should come to the conclusion that the discretion was arbitrarily exercised by the court below before it thinks of interfering with it.'
Taking the facts of this case into consideration it must be said that the lower court has not exercised its discretion arbitrarily, the contention was that this was a finding of the lower appellate court on a question, of fact viz., whether the facts warranted the refusal of the specific relief to the plaintiff. In this connection the decision in Ramalinga v. Jagadammal : AIR1951Mad612 was cited. The learned Judge lays down:
'Under Section 22, Specific Relief Act, 'the discretion of the court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal'. Where a decree for specific performance granted by the trial court is reversed by the appellate court in disregard of the relevant statutory provisions or legal principles recognised by judicial precedents, the Judgment of the appellate court is liable to be reviewed in the second appeal.'
In the circumstances of the case I am satisfied that the conclusions of the lower appellate court interfering with the discretion exercised by the trial court is unwarranted by law and hence it is liable to be reviewed in second appeal. The lower appellate court in, expressing the view that even in the event of the plaintiff being entitled to specific performance the said relief cannot be granted to him has acted against the provisions of Section 22. The contention of respondents' counsel that this is a finding of fact cannot be accepted. This is a finding opposed to the provisions of law and not justifiable and that this court can interfere as has been laid down in : AIR1951Mad612 .
18. The respondents' counsel further contended that in view of the fact that the plaintiff has asked for an alternative relief for compensation, it is evident that he was conscious of the fact that he was not entitled to a decree for specific performance. My attention was invited to the provisions of Section 19 of the Specific Relief Act. It was submitted that this section should be read along with Section 22 of the Specific Relief Act. Reading these two sections together, there is justification to refuse a decree for specific performance in this case. I am unable to agree with this contention. Sections 19 and 22 are independent of each other. Section 19, contemplates a suit for specific performance. In such a suit it is open to the plaintiff to ask for compensation for the breach of the contract either in addition to or in substitution for such purpose. The fact that the plaintiff has asked for the alternative relief which is permissible under Section 19 does not prejudice his right to get a decree for specific performance. The second paragraph of Section 19 makes the matter very clear. If specific performance cannot be granted and the breach of the contract is by the defendant, the plaintiff would be entitled to compensation for that breach. It is quite conceivable that specific performance may not be granted for the reasons mentioned under Section 22 and not for the reason that the plaintiff has sought alternative relief.
19. In the circumstances stated above, I am satisfied that the judgment and decree passed by the lower appellate court cannot be sustained. The appeal is allowed and the judgment and decree of the trial court are restored.
20. In the circumstances of the case, I direct the parties to bear their own costs.