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Bajranglal and anr. Vs. Purushottamdas Puranlal Narele - Court Judgment

LegalCrystal Citation
SubjectContract
CourtMadhya Pradesh High Court
Decided On
Case NumberFirst Appeal No. 205 of 1968
Judge
Reported inAIR1972MP137; 1972MPLJ555
ActsSpecific Relief Act, 1963 - Sections 16
AppellantBajranglal and anr.
RespondentPurushottamdas Puranlal Narele
Appellant AdvocateB.L. Seth, Adv.
Respondent AdvocateB.C. Verma, Adv.
DispositionAppeal dismissed
Cases ReferredThe Madras High Court In Arjuna v. Lakshmi
Excerpt:
.....like section 37 of the act which expressly or impliedly prohibits claiming of a relief of specific performance in a suit for redemption and, as already stated, in the instant case the plaintiff did plead his readiness and willingness to perform his part under the contract for reconveyance. but there was no corresponding provision in section 24 of the old act like clause (c) of section 16 of the new act. the plaintiff for entitling him to the relief of specific performance, will have to satisfy that he alleged and proved his readiness and willingness to perform the contract in accordance with that construction which is ultimately accepted by the court and, if he succeeds in establishing that he would not fail merely because other alternative constructions which are not accepted..........of the suit house from the defendants by way of redemption, or in the alternative, by way of specific performance. the defendants contested the suit denying that the sale and the agreement for reconveyance constituted a mortgage by conditional sale or that the defendant no. 1 bajranglal had promised to explain the accounts later. the plaintiff's readiness and willingness to pay rs. 10,000/-, and to take reconveyance was also disputed. during the trial the plaintiff gave up his case of redemption and confined his case to that of specific performance of the agreement for reconveyance. the trial court held that the plaintiff was always ready and willing to perform his part of the contract and that he was entitled to specific performance. a decree was, therefore, passed against.....
Judgment:

Singh, J.

1. This is an appeal by the defendants in a suit for specific performance of a contract for reconveyance.

2. The facts now no longer in dispute are that Purushottamdas owned a house (No. 443 old No. 88) in Miloniguni, Jabalpur. He sold this house for a sum of Rs. 10,000/- on December 2, 1963, to Bajranglal. An agreement for reconveyance of the house on payment of Rs. 10,000/- within two years was executed by Bajranglal in favour of Purushottamdas. The agreement bears the date December 3, 1963, but the finding of the trial Court, which has not been challenged before us, is that it was executed on December 2, 1963 and the sale and agreement constituted one transaction. Possession of the house was not delivered to Bajranglal and Purushottamdas continued to be in possession. He, however, executed a rent-note agreeing to pay rent at the rate of Rs. 120/-per month. Previously, the same house was mortgaged on December 7. 1960, in favour of Firm Fatehchand Shrinivas for a sum of Rs. 1,500/-. The mortgage was in the nature of a mortgage by conditional sale, Bajranglal happens to be the managing partner of the Firm Fatehchand Shrinivas.

3. The suit giving rise to this appeal was instituted by Purushottamdas on December 2, 1965, against Bajranglal and Firm Fatehchand Shrinivas. The case of the plaintiff as pleaded in the plaint was that the sum of Rupees 10,000/- constituting consideration of the sale consisted of previous loans of which Rs. 3,000/- were principal and Rupees 7,000/- were interest. It was also pleaded that at the time of sale Bajranglal had promised to explain the accounts of the previous transactions, but that was never done. It was further alleged that the sale together with the agreement for reconveyance constituted a mortgage and the plaintiff was entitled to redeem the house after paying the sum which is found due on the reopening of the accounts. In the alternative, the plaintiff also pleaded that he has always been ready and willing to perform his part under the agreement for reconveyance and to pay Rs. 10,000/- for obtaining reconveyance. It was alleged that the plaintiff gave a notice on November 26, 1965, to the defendants to come to Jabalpur on December 1, 1965, for executing a conveyance on payment of Rs. 10,000/-, but the defendants did not turn up. The plaintiff expressed his readiness to pay Rs. 10,000/- and such other sums which may be adjudged payable from the plaintiff to the defendants. The relief in the suit was for reconveyance of the suit house from the defendants by way of redemption, or in the alternative, by way of specific performance. The defendants contested the suit denying that the sale and the agreement for reconveyance constituted a mortgage by conditional sale or that the defendant No. 1 Bajranglal had promised to explain the accounts later. The plaintiff's readiness and willingness to pay Rs. 10,000/-, and to take reconveyance was also disputed. During the trial the plaintiff gave up his case of redemption and confined his case to that of specific performance of the agreement for reconveyance. The trial Court held that the plaintiff was always ready and willing to perform his part of the contract and that he was entitled to specific performance. A decree was, therefore, passed against defendant No. 1 for specific performance of the agreement for reconveyance on condition of payment of Rs. 10,000/-. The defendant No. 2 was discharged from the suit. Against this decree both the defendants have preferred this appeal.

4. The first contention raised by learned counsel for the appellants is that the finding reached by the trial Court that the plaintiff was always ready and willing to perform his part under the contract of reconveyance is incorrect.

5. In our opinion, this contention It wholly without any substance, Ex. P-3 is the notice issued on November 26, 1965, by the plaintiff to the defendant Bajranglal in which it was stated that he had arranged for the money and was ready to take the reconveyance. It was also stated that the defendant should send a draft of reconveyance to the plaintiff so that he may keep the document of reconveyance ready. The defendant was further requested to attend the registration office at Jabalpur on December 1, 1965, for getting the document of reconveyance registered. Ex. P-6 are the stamps which the plaintiff had purchased on December 1, 1965, for the deed of reconveyance. Ex. P-9 is an application which the plaintiff filed in the Sub-Registrar's office stating that he was present in the office from 11-00 a.m., that Bajranglal had not turned up, and that his attendance may, therefore, be noted. There is an endorsement on this application that it was presented at 3.00 p. m. and that as no action was necessary it may be filed. Ex. P-7 is a pass-book which shows that a sum of Rs. 12,500/- was in deposit to the credit of the plaintiff in the Central Bank of India Ltd., on December 3, 1965. The plaintiff's evidence supported by these documents goes to establish that he was ready with money and the required stamps and he attended the Sub-Registrar's office on December 1, 1965, from 11-00 a. m. to 4-00 p. m. but the defendant did not turn up for executing the deed of reconveyance. The evidence of the plaintiff is corroborated by other witnesses: [See in this connection the evidence of G.D. Gupta (P. W. 2), Shankerlal Bahare (P. W. 3) and Beharilal (P. W. 9)]. The defendant Bajranglal was to appear as a witness in a Civil case and he did come to Jabalpur on December 1, 1965. It is proved by Banarasidas (P. W. 6) and Jhabbulal (P. W. 10) that the plaintiff approached the defendant in the Civil Court building and requested him to go to the Sub-Registrar's office for executing the deed of reconveyance. But in spite of it the defendant did not go to the Sub-Registrar's office. The defendant No. 1 in his evidence said that he waited for the plaintiff till 2-00 p. m. in the Sub-Registrar's office, but as the plaintiff did not turn up he came back to the Civil Court. Having considered the entire evidence, we accept the evidence of the plaintiff and his witnesses that the plaintiff was ready with money and stamps for obtaining the deed of reconveyance from the defendant but the defendant did not turn up in the Sub-Registrar's office. The plaintiff in his evidence expressed his willingness to pay the amount of Rupees 10,000/- to the defendant. The plaintiff's continued readiness and willingness to perform his part of the contract till the date of trial is, therefore, sufficiently established.

6. Learned counsel for the appellants' second contention is that the plaintiff having pleaded in the plaint that the transaction of sale and the agreement for reconveyance were in the nature of a mortgage by conditional sale and that account should be reopened and a decree for redemption be passed, cannot be said to have pleaded his readiness and willingness to perform his part under the agreement for reconveyance. It is also argued that as the main relief in the suit was of redemption, the relief of specific performance which was in the alternative cannot be granted and the suit as framed was not maintainable.

7. It is true, as we have earlier stated, that the plaintiff pleaded that the transactions of sale and agreement for reconveyance were in the nature of a mortgage by conditional sale and he also claimed a relief of redemption. But the plaintiff also pleaded his readiness and willingness to perform in full the contract for reconveyance by paving Rs. 10,000/- and such other sum which may be adjudged as payable and expressed his willingness to deposit the requisite amount in Court. A relief of specific performance was also claimed in the alternative. As already stated, the case of mortgage was given up by the plaintiff at the trial. The question then is, whether by pleading the mortgage and claiming redemption the plaintiff was not entitled to a decree for specific performance, although he had pleaded his readiness and willingness to perform his part under the agreement and had claimed the relief of specific performance in the alternative. Order 7, Rule 7 of the Code of Civil Procedure permits a plaintiff to pray for even inconsistent reliefs in the alternative and unless some statute prohibits claiming of a relief of specific performance in the alternative with a relief of redemption, it cannot be held that the suit as framed was not maintainable. Learned counsel for the appellants relied upon the case of Prem Raj v. D. L. F. Housing & Construction (P) Ltd., AIR 1968 SC 1355 in which it was held that a relief of specific performance cannot be claimed in the alternative in a suit where the main relief is of rescission of the contract. The decision in that case proceeded upon Section 37 of the Specific Relief Act, 1877 (new Section 29 of the Specific Relief Act, 1963). That section permits alternative prayer for rescission in a suit for specific performance. On a construction of that section, it was held that impliedly the section did not permit alternative prayer for specific performance in a suit for rescission. It was also observed in that case that the plaintiff had not pleaded his readiness and willingness to perform the contract. There is no provision like Section 37 of the Act which expressly or impliedly prohibits claiming of a relief of specific performance in a suit for redemption and, as already stated, in the instant case the plaintiff did plead his readiness and willingness to perform his part under the contract for reconveyance. For these reasons, the case of Prem Raj AIR 1968 SC 1355 is entirely distinguishable and has no application. Reliance was also placed on the case of Gomathinayagam Pillai v. Palaniswami Nadar AIR 1967 SC 868. In that case it was held that the plaintiff must aver and prove readiness and willingness to perform his part of the contract from the date of contract upto the date of trial. But it was not held in Pillai's case AIR 1967 SC 868 that a plaintiff cannot claim the relief of specific performance in the alternative.

8. The present suit is governed by the provisions of the Specific Relief Act, 1963. Section 16 of the Act reads as follows:--

'Section 16. 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.'

This section takes the place of Section 24 of the old Act. But there was no corresponding provision in Section 24 of the old Act like Clause (c) of Section 16 of the new Act. This clause has been added on the basis of principles enunciated by case law. By reason of Clause (c) it is now expressly provided that in a suit for specific performance the plaintiff must 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. Explanation (ii) is also material. It provides that the plaintiff must aver performance of, or readiness and willingness to perform, the contract 'according to its true construction.' According to the argument of the learned counsel for the appellants, the plaintiff in a suit for specific performance must adopt only one construction of the contract and must allege his readiness and willingness to perform the contract in accordance with that construction. In our opinion, on the language used in Clause (c) read with the explanation, this argument cannot be accepted. A contract may be open to more than one construction and a plaintiff may allege the alternative constructions to which the contract may be open and claim relief on that basis. The true construction of the contract would be that construction which is finally accepted by the Court. The plaintiff for entitling him to the relief of specific performance, will have to satisfy that he alleged and proved his readiness and willingness to perform the contract in accordance with that construction which is ultimately accepted by the Court and, if he succeeds in establishing that he would not fail merely because other alternative constructions which are not accepted by the Court were also alleged and relief was claimed on that basis. Alternative constructions, if persisted throughput the trial, may, in some cases, create difficulty in proving readiness and willingness from the date of contract according to the true construction, for if the alternative constructions are inconsistent, proof of readiness and willingness according to one construction may be destructive of readiness and willingness according to other construction. That difficulty however, does not arise in the present case as the case of mortgage was given up by the plaintiff at the trial. The plaintiff alleged his readiness and willingness to perform the contract from the beginning on the footing that it was a contract to recovery and also proved that fact. He was, therefore, entitled to the relief of specific performance, notwithstanding that he also alleged that the contract was a mortgage and claimed redemption on that basis.

9. The conclusion reached by us as to the requirement of Section 16(c) is strengthened if we look into the circumstances that led to the enactment of Section 16 in the present shape. The statement of objects and reasons appended to the bill which became the Act goes to show that the bill was introduced to implement the recommendations of the Law Commission contained in its Nineth Report on the working of the Specific Relief Act, 1877. On the question of averment of readiness and willingness to perform the contract on the part of the plaintiff the recommendations of the Law Commission are contained in paragraphs 60 and 61 of their Report. These recommendations read thus:

'60. It has been held by the Privy Council that in a suit for specific performance, the plaintiff must show that all conditions precedent have been fulfilled and also allege and (where the fact is traversed) prove a continuous readiness and willingness to perform the contract on his part, from the date of the contract to the time of hearing. Ardeshir Mama v. Flora Sasson, ILR 52 Bom 597 = (AIR 1928 PC 208). Though there is no express requirement to this effect in the Specific Relief Act, it has been held that failure to allege readiness and willingness will lead to a dismissal of the suit. Madan v. Kamaldhari AIR 1930 Pat 121-127.

But the plaintiff need not prove performance of or ever-readiness and willingness to perform non-essential terms; or

terms of a separate or collateral contract; or

terms, the preformance of which has been prevented or waived by the defendant; or

terms, the performance of which has become impossible without the plaintiff's fault.

We consider that the doctrine of readiness and willingness so formulated should be incorporated into our Act.

61. There is, however, a conflict of opinion as to the exact scope of the plaintiff's readiness and willingness required by the doctrine. In England, it has been held Berners v. Fleming, (1925) Ch. 264 (C. A.); Halsbury. 2nd Ed. Vol. 31, p. 436, that a plaintiff claiming specific performance who insists on a wrong interpretation of the contract, does not lose his right to specific performance in accordance with its right interpretation where the defendant offers to perform the contract as 'rightly interpreted. In India, the Calcutta, Parul Bala v. Saroj Kumar, AIR 1948 Cal 147; Rustomali v. Ahider, (1941) 45 Cal WN 837 and Nagpur, Shamjibhai v. Jagoo, ILR (1949) Nag 581 (607-10), High Courts have taken the view that the plaintiff must allege and prove his readiness to perform the contract as it really was and not as it was alleged by him to be. Thus, where a purchaser sought specific performance alleging that he was always ready and willing to pay Rs. 85/- which, according to him, was the price fixed by contract, but the Court found that the price fixed by the contract was, in fact, Rs. 130/- the suit for specific performance was dismissed. (1941) 45 Cal WN 837. Similarly, it has been held that, if the plaintiff insists on a condition which he is not entitled to under the contract as properly interpreted, his suit for specific performance must fail, ILR (1949) Nag 581 (607-10)

The Madras High Court In Arjuna v. Lakshmi, AIR 1949 Mad 265 has taken the view that even where the plaintiff alleges that the consideration payable by him was different from the real amount, there is a sufficient averment on the part of the plaintiff of his readiness and willingness to perform his part of the contract, if he adds in the plaint that 'he has no objection to paying the defendant any sum that the court should be pleased to fix.'

We are inclined to prefer the Madras view and recommend that the plaintiff should be entitled to specific performance if he avers performance or readiness and willingness to perform the contract according to its true construction.'

It will be seen from paragraph 61 of the report that the Law Commission preferring the Madras view in AIR 1949 Mad 265 (Supra) recommended that the plaintiff should be entitled to specific performance if he avers performance or readiness and willingness to perform the contract according to its true construction. This recommendation was fully accepted as will appear from the notes on Clause 15 which took the shape of Section 16. Explanation (ii) appended to Section 16 which provides that the plaintiff must aver performance or readiness or willingness to perform the contract according to its true construction is thus based upon the recommendations of the Law Commission approving the Madras view in Arjuna's case, AIR 1949 Mad 265. The facts of that case were very much similar to the present case. As in the case before us the plaintiff in that case also pleaded that a sale-deed together with an agreement to reconyey amounted to a mortgage by conditional sale and the plaintiff was entitled to redeem. The plaintiff raised various pleas as regards the amount rightly payable to the contesting defendant, but finally stated 'though the plaintiff is entitled to claim larger reliefs from the defendant, the plaintiff has no objection to pay the defendant any sum that the Court should be pleased to fix.' On these averments the plaintiff claimed redemption or, in the alternative, specific performance. In holding that the averment made in the plaint was a sufficient averment of readiness and willingness, Rajamannar, C. J. observed.

'The plaintiff is not asserting a right to perform the contract not as it actually was but as it is alleged to be by him. Though he puts forward his own case, he makes it clear that he is ready and willing to perform the terms of the contract in accordance with the decision of the Court. No authority has been cited to us that an averment that the plaintiff had no objection to perform the contract in accordance with the decision of the Court is not a sufficient averment of his readiness and willingness to perform his part of the contract.'

The surrounding circumstances that led to the passing of Section 16(c) of the present Act thus go to show that it was not intended to deprive a plaintiff to plead alternative constructions of a contract which he seeks to enforce.

10. By referring to the report of the Law Commission as part of the surrounding circumstances, we hope we have not transgressed the rule of statutory interpretation that Parliamentary History of an Act cannot be used for interpretation proper, for this rule is qualified by another rule which enables the admission of Parliamentary History as part of the surrounding circumstances or as throwing light on the subject-matter of the Act or for discerning the evil or mischief intended to be remedied. We, however, confess that these rules which we have adopted from the English practice of interpretation do not make any clear distinction between what they prohibit and what they permit. The unsatisfactory state of this branch of the law needs some reform to enable the Courts to admit without disguise selective material out of Parliamentary History for interpretation. As stated by Prof. Alien:

'Nobody, so far as I know, has advocated that an unlimited and undefined mass of travaux preparatories be cast upon the courts; but there are certain authoritative sources of information which it seems somewhat pedantic to withhold from the judicial purview.' (Law in the Making, (7th Edition, page 527)).

In England, the Law Commission and the Scottish Law Commission have recently recommended that the Courts while interpreting statutes should be allowed to consider the following:

'(a) All indications provided by the Act as printed by authority, including punctuation and side-notes, and the short title of the Act;

(b) any relevant report of a Royal Commission. Committee or other body which has been presented or made to or laid before Parliament or either House before the time when the Act was passed;

(c) any relevant treaty or other international agreement which is referred to in the Act or of which copies had been presented to Parliament by command of Her Majesty before that time, whether or not the United Kingdom were bound by it at that time;

(d) any other document bearing upon the subject-matter of the legislation which had been presented to Parliament by command of Her Majesty before that time;

(e) any document (whether falling within the foregoing paragraphs or not) which is declared by the Act to be a relevant document for the purpose of this section.'

(See (1970) 33 Modern Law Review 197, page 198).

These recommendations can usefully be adopted in our country also.

11. The appeal fails and Is dismissed with costs.


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