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A.L. Parthasarathi Mudaliar Vs. Venkata Kondiah Chettiar - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai High Court
Decided On
Case NumberAppeal No. 153 of 1959 and C.M.P. No. 5321 of 1962
Judge
Reported inAIR1963Mad106
ActsSpecific Relief Act, 1877 - Sections 14, 15 and 16
AppellantA.L. Parthasarathi Mudaliar
RespondentVenkata Kondiah Chettiar
Appellant AdvocateS. Krishnaswami and ;Vithal V. Souli, Advs.
Respondent AdvocateD.C. Krishnamurthi, Adv.
DispositionAppeal partly allowed
Cases ReferredIn Pramathnath Mitra v. Gosthabhiari Sen
Excerpt:
property - specific performance - sections 14, 15 and 16 of specific relief act, 1877 - whether plaintiff entitled to decree of specific performance on finding that item no.2 did not belong to defendant - defendant executed agreement to sell items no.1 and 2 - defendants defaulted in executing sale deed as promised by them - defendant backed out from sale because owner of item no.2 was not willing to sell - section 15 provides for direction to party in default to perform his part of contract as he can perform provided plaintiff relinquishes all claims to further performance sustained by him through default of defendant - section 15 permits plaintiff to relinquish his claim to compensation at any stage of action - held, equitable relief of specific performance within terms of section 15..........signature thereon, and she had no interest in both the items.2. the lower court found that the suit agreement was true, valid, and binding on the first defendant and that it was not executed in the circumstances alleged by the first defendant which amounted to fraud and mis-representation played upon him. it was signed by the first defendant with full knowledge of the contents. the lower court then held that only item 1 belonged to the first defendant, and he had no right to convey item 2 which belonged to his sisters. then, the trial court applied section 14 of the specific relief act. it took the value of item 2 at rs. 850 relying upon the valuation in the plaint for the purpose. deducting this amount, it fixed the value of item 1 at rs. 4900. from this one thousand rupees paid as.....
Judgment:

Ramakrishnan, J.

1. This appeal is directed against the judgment and decree of the learned IV Assistant Judge of the City Civil Court in O. S. No. 901 of 1957, a suit filed for specific performance of an agreement to sell immoveable property. One Loganatha Mudaliar purchased the plaint-schedule item 1 in his name and the plaint schedule item 2 in the name of his wife, Rathanammal. Loganatha Mudaliar died in 1955 and Rathanammal died in 1947, toganatha Mudaliar executed the will Ex. B-1, dated 1-3-1954 under which he gave the plaint schedule item 1 (two acres and 85 cents) in Kodur village in Rajampet taluk in Cuddappah Dt. to his son, Parthasarthi Mudaliar, the first defendant in the suit, he gave item 2 of the plaint schedule (1 acre and 41 cents) land in Kodur village to his daughters who are not parties to this suit; he gave some other property to his daughter-in-law, Nagarathnammal, who had, at that time, lost her husband and who is the second defendant in the suit. It is alleged by the plaintiff, in the suit, that the first and the second defendants had executed the agreement marked as Ex. A-1 in the case to sell the plaint schedule items 1 and 2 for a consideration of Rs. 5750. Rs. one thousand was paid immediately and the balance was agreed to be paid within three months. There was also a provision that in case of default, the promisor would pay Rs. 5000 as penalty. On the ground that the defendants defaulted in executing the sale deeds as promised by them even though the plaintiff was willing to pay the balance of the sale price, the plaintiff filed the suit praying for the following reliefs:

'that the defendants may be directed to receive Rs. 4750 being the balance of the sale price and effect a conveyance of both the items of the schedule described properties getting Sivakamiammal, Nithyanandammal and Jeevarathnammal the sisters of the first defendant to join in the sale deed; or in the alternative the defendants may be directed to receive Rs. 3000 and effect a conveyance of item 1 of the schedule described properties and pay such compensation for the non-conveyance of item 2 of the schedule described properties as this Hon'ble Court may fix, or in the alternative that the defendants may be decreed to pay Rs. 6000 to the plaintiff as compensation.'

The first defendant pleaded that he was in Madras while the second defendant, his sister-in-law was at Vellore. The agreement of sale dated 14-2-1957 is in telugu. The first defendant can speak telugu and does not know to read and write the language. He wanted to raise a loan against the first Item of the properties which alone he got, as per the will of his father. He told his brother-in-law, Jagadesa Mudaliar, retired sub-inspector of police to arrange for the loan. He was informed that the agreement was only for purpose of raising a loan and therefore he signed it. Subsequently, he came to know of the fraud played upon him. It was Jagadesa Mudaliar who received the thousand rupees as advance and it was returned to the plaintiff. In the above circumstances, he was not bound to execute the sale deed. The second defendant said that she signed the agreement on seeing the first defendant's signature thereon, and she had no interest in both the items.

2. The lower court found that the suit agreement was true, valid, and binding on the first defendant and that it was not executed in the circumstances alleged by the first defendant which amounted to fraud and mis-representation played upon him. It was signed by the first defendant with full knowledge of the contents. The lower court then held that only item 1 belonged to the first defendant, and he had no right to convey item 2 which belonged to his sisters. Then, the trial court applied Section 14 of the Specific Relief Act. It took the value of item 2 at Rs. 850 relying upon the valuation in the plaint for the purpose. Deducting this amount, it fixed the value of item 1 at Rs. 4900. From this one thousand rupees paid as advance was deducted, and the first defendant was directed by the decree to receive Rs. 3900, and convey item 1. The suit against the second defendant was dismissed without costs. From the above decision, the present appeal is filed by the first defendant.

3. It was urged by the learned counsel for the appellant that the trial court should have found that the first defendant did not know to read or write Telugu and that he signed the document without knowing its nature and on the misrepresentation that it was a document to raise a loan. There was a contention, in the grounds of appeal, that the court at Madras had no jurisdiction to try the suit; but it was not pressed at the time of the hearing of the appeal. What was urged before me was the plea that the plaintiff's suit should have been dismissed De-cause the contract found proved was different from the contract pleaded by the plaintiff, and therefore, specific performance was not possible. This was not a case where Section 14 of the Specific Relief Act should have been applied.

4. The point for determination, in this appeal, are (1) whether the suit agreement had been executed by the first defendant without knowing its contents and in the circumstances of fraud and misrepresentation pleaded by the first defendant; and (2) (Sic) it is found that item 2 did not belong to the promisor, namely, the first defendant is the plaintiff entitled to a decree for specific performance of the agreement.

5-7. Taking up point (1), the first defendant admittedly is an educated person. He is a M.B.B.S., and is a doctor employed in the Corporation of Madras. His father was employed in the telugu districts, and purchased the suit property in Cuddappah Dt. The first defendant admits that he knows to speak telugu but he is not able to read or write telugu. The suit agreement is written in telugu. The specific case of the first defendant is that he requested his brother-in-law one Jagadesan Mudaliar, a retired sub-Inspector of Police, to arrange for a loan on the security of the suit item 1 for the marriage of his daughter. His brother-in-law sent a letter with the suit agreement. It was after seeing that letter that he signed the suit agreement believing that it was for securing a loan, and not an agreement to sell the property.

(His Lordship reviewed the evidence on this point and proceeded:)

8. The evidence in the case clearly supports the filling of the trial court that the first defendant had not discharged the onus of proving fraud and misrepresentation practised upon him for executing the document, and that, on the other hand, the evidence of the plaintiff's witnesses about the circumstances of the execution of the document has to be relied upon as true. This inference is supported further by the post card, Ex. A-6, written by the first defendant to the plaintiff and which is in the following terms:

'I wish to inform you that I am not selling the garden as my sisters are not willing to give me their consent. So I request you to leave the idea of buying it and do not trouble me for the same. If you want anything more, you better contact my brother-in-law at Cuddapah and proceed as you like. I have not received your advance money a pie and it is deposited in the bank and if you do not settle, it will be paid in court. . . . .You can do anythingand settle with my brother-in-law at Cuddapah. ........

Sd. A. L. Parthasarathni.'

This post card would show conclusively that the first defendant backed out from the sale because his sisters were not willing to give consent for selling item 2 of the property. It also shows that the first defendant knew of the advance paid by the plaintiff, and asserted that it was kept in the bank and that he was willing to return it to the plaintiff. It is therefore idle for the first defendant to deny the suit agreement and the receipt of the advance therefor.

9. The further question is how far specific performance of the suit agreement could be decreed when it is found that the promisor had not title in regard to item 2. Out of the three sections of the Specific Relief Act which were referred to in this connection viz. Sections 14, 15 and 16, Section 14 has been held by the lower court as applicable to the present case. That section reads:

'Where a party to a contract is unable to perform the whole of his part of it, but the part which must be left unperformed bears only a small portion of the whole in value and admits of compensation in money, the court may at the suit of either party direct the specific performance of so much of the contract as can be performed, and award compensation in money for the deficiency.'

Now the part of the contract which could not be performed, in this case, is the conveyance of item 2 which measures 1.41 acres as against item 1 which could be conveyed, and which measures 2.85 acres. The contention of the first defendant is that item 1 being a land planted with fruit bearing trees is much more valuable than item 2. It is also admitted by the plaintiff in the plaint, that item 2 is valued at Rs. 850 as against the value of item 1 which will be the remainder, that is, Rs. 4900. Section 14 of the Specific Relief Act is based upon the English law on the subject, which has been summed up by the Privy Council in Rutherford v. Acton Adams, 1915 AC 866 : AIR 1915 PC 113:

'If a vendor sues and is in a position to convey substantially what the purchaser has contracted to get, thecourt will decree specific performance with compensationfor any small and immaterial deficiency provided that thevendor has not, by misrepresentation or otherwise, disentitledhimself to his remedy.'

But, in the present case, one cannot consider item 2 as amounting to a small and immaterial deficiency in the contract, which will entitle the plaintiff to get a decree for specific performance subject to the payment of compensation to the vendee by equating the amount of compensation to the price of item 2. On the other hand, Section 15 of the Specific Relief Act seems to be more in point. It reads:

'Where a party to a contract is unable to perform the whole of his part of it, and the part which must be left unperformed forms a considerable portion of the whole or does not admit of compensation in money, he is not entitled to obtain a decree for specific performance. But the court may at the suit of the other party, direct the party in default to perform specifically so much of his part of the contract as he can perform, provided that the plaintiff relinquishes all claim to further performance, and alt right to compensation either for the deficiency or for the loss or damage sustained by him through the default of the defendant.'

Illustration (a) to that section is also relevant to this case:

'A contracts to sell to B a piece of land consisting of 100 bighas. It turns out that 50 bighas of the land belong to A and the other 50 bighas to a stranger, who refuses to part with them. A cannot obtain a decree against B for the specific performance of the contract; but if B is willing to pay the price agreed upon, and to take the 50 bighas which belong to A, waiving all right to compensation either for the deficiency or for loss sustained by him through A's neglect or default, B is entitled to a decree directing A to convey those 50 bighas to him on payment of the purchase-money.'

Section 16 of the Specific Relief Act refers to a part of a contract which, taken by itself, can and ought to be specifically performed and stands on a separate and independent footing from another part of the same contract which cannot or ought not to be specifically performed. In the present case, the conveyance of item 2 does not stand on a separate and independent footing from the conveyance of item 1. A common valuation is given to both the items and they are dealt with in a single contract. There can therefore be no question of the application of Section 16. As held before this is a case where specific relief by performance of the agreement could be granted to the plaintiff by conveyance of item 1 provided he pays the full amount of consideration and waives all right to compensation for the deficiency or for the loss or damage sustained by him through default of the first defendant.

10. At the time when the appeal was heard, the plaintiff filed a petition saying that he was willing to purchase item 1 of the suit property for the contract price of Rs. 5750 and give up the claim for compensation so as to obtain relief under Section 15 of the Specific Relief Act. That application was opposed by the respondent first defendant on the ground that the price of the land had increased many fold and that item 1 would be at least worth Rs. 8000 for the land portion of it, and that if the lime and orange trees which had begun to yield are taken into account, it would be worth much more than Rs. 12,000.

11. It has been pointed out in several decisions of courts that the giving up of the relief of compensation could be made by the promisor at any stage in the action In Kalyanpur Lime Works Ltd v. State of Bihar, : [1954]1SCR958 , the Supreme Court had observed that relinquishment of the claim to further performance can be made at any stage of the litigation and the plaintiff can claim relief under Section 15 of the Specific Relief Act. This has been followed by the Calcutta High Court in Dwijendra Kumar v. Monmohan De, : AIR1957Cal209 , where it observed that the relinquishment can be made even in second appeal. In Pramathnath Mitra v. Gosthabhiari Sen it was held by the Privy Council that the specific performance of a part could not be granted where the plaintiff had not relinquished all other claims as required by Section 15 of the. Specific Relief Act. But the Privy Council did not consider the question about the stage at which the promisee could relinquish his claim. That question has been dealt with only in the two former decisions above cited.

12. As regards the contention in the counter to the application, that the lands have appreciated in value since the filing of the suit, it is pointed out that the suit agreement is dated 14-2-1957 and the suit was filed on 30-4-1957, that is, within 2 months thereafter. The plaintiff has, therefore, come to the court at the earliest opportunity. The law permits the plaintiff to relinquish his claim to compensation at any stage of the action, even at the stage of the second appeal. We are now at the stage of the first appeal. No doubt, five years had passed from the date of the plaint, but that is not due to the default of the plaintiff, but is due to other causes. Therefore, any possible appreciation of the price in the interval, that has elapsed between the date of the plaint and the date or the present application, will not be an adequate ground for refusing specific performance, after permitting the plaintiff to relinquish a portion of the property on which the promisor had no title to sell. It must also be borne in mind when granting this relief on an equitable basis, that Jagadesa Mudaliar, the first defendant's brother-in-law who represented him in this transaction, has been responsible for making the representation that the defendants had title to item 2, or, in any event, that a valid title would be conveyed in regard to that item also. In the post card above referred to, the first defendant had stated that his sisters would not agree to sell their property. In other words, the first defendant knew even earlier that the plaintiff had agreed to buy item 2 and that a representation fad been made that the assent of the first defendant's sisters would be obtained; consequently in fixing the sale price item 2 also would have been taken into account. In these circumstances. I am of the opinion that the equitable relief of specific performance within the terms of Section 15 of the Specific Relief Act, can be granted to the plaintiff.

13. Consequently, I allow this petition and permit theplaintiff to relinquish his relief in regard to item 2. Theappeal is allowed in part, and in modification of the decreeof the lower court, the plaintiff will get a decree directingthe first defendant to receive Rs. 4750 (i.e., Rs. 3/50less advance of Rs. 1000 paid) and effect the conveyanceof item 1 of the plaint schedule property with costs inthe suit; the decree of the trial court will be confirmedin other respects. Time to pay the balance of the condition(sic) 4 weeks from the date of receipt of this order by thelower court. The rest of the appeal is dismissed. The appellants will pay three-fourths of the costs of this appealto the respondent.


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