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Ramaswamy Padayachi Vs. Rangaswami Padayachi (Died) and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty;Contract
CourtChennai High Court
Decided On
Reported in(1977)2MLJ51
AppellantRamaswamy Padayachi
RespondentRangaswami Padayachi (Died) and ors.
Cases ReferredInternational Contracts Ltd. v. Prasanta Kumar
Excerpt:
- - there was failure on the part of the plaintiffs to perform their part of the contract. i am therefore, satisfied that the plaintiffs are entitled to a decree and the second appeal is liable to be dismissed......4th august, 1966. the respondents-plaintiff's were the owners originally of the suit property. by sale deed dated 4th august, 1966 they conveyed the property to the defendant for a sum of rs. 4,000. on the same day the defendant executed the agreement to re-convey the property on receipt of rs. 4,280 within a period of two years from 4th august, 1966. on 12th june, 1968 the plaintiff issued the lawyer's notice exhibit b-2 under which after pointing out that the defendant was under obligation to reconvey the property on receipt of rs. 4,280 under the agreement of reconveyance stating that the plaintiffs were to pay the money before the sub-registrar and called upon the defendant to execute the reconveyance on 10th july, 1968. on the ground that the defendant had not conveyed his.....
Judgment:

V. Ramaswami, J.

1. The defendant is the appellant. The suit was filed for specific performance of an agreement to reconvey dated 4th August, 1966. The respondents-plaintiff's were the owners originally of the suit property. By sale deed dated 4th August, 1966 they conveyed the property to the defendant for a sum of Rs. 4,000. On the same day the defendant executed the agreement to re-convey the property on receipt of Rs. 4,280 within a period of two years from 4th August, 1966. On 12th June, 1968 the plaintiff issued the lawyer's notice Exhibit B-2 under which after pointing out that the defendant was under obligation to reconvey the property on receipt of Rs. 4,280 under the agreement of reconveyance stating that the plaintiffs were to pay the money before the Sub-Registrar and called upon the defendant to execute the reconveyance on 10th July, 1968. On the ground that the defendant had not conveyed his willingness to execute the sale deed, the suit was filed for specific performance. The plaintiffs have specifically alleged in the plaint that they had been pressing upon the defendant to receive Rs. 4,280 and execute the sale deed on several occasions and that the defendant was evading the same on some ground or other and ultimately the plaintiffs issued the lawyer's notice dated 12th June, 1968 but the defendant has not expressed his willingness to execute. The plaintiffs further stated that they were ready and willing to perform their part of the contract and that they have got the money ready and were prepared to pay the same the moment the defendant executed the document. The defendant contested the suit and stated that the plaintiffs never tendered the sum of Rs. 4,280 to the defendant and in fact they had no money to purchase. When the defendant received the notice dated 12th June, 1968 he asked the plaintiffs to purchase stamp papers and bring them and that he was prepared to receive the money but the plaintiffs did not bring the money. The defendant was always ready and willing to execute the sale deed but since the plaintiffs did not tender the money he could not execute the sale deed. There was failure on the part of the plaintiffs to perform their part of the contract. The time was the essence of the contract and the period of two years expired on 4th August, 1968. The trial Court held that the plaintiffs have not proved that they in fact had money on the day when they issued the lawyer's notice nor does the evidence disclose their readiness and willingness to perform their part of the contract on the day when the lawyer's notice was issued or before the filing of the suit. The trial Court pointed out that the plaintiffs had not purchased stamp papers and had also not tendered the money to the defendant at any time prior to suit. They had also not deposited the money into Court. On that ground the trial Court held that the plaintiffs had not tendered the money to the defendant. In that view the trial Court dismissed the suit. The lower appellate Court, on the other hand, took the view that the plaintiffs were owning a large extent of 40 acres and that therefore, they had the means to pay. Though a notice was issued to the defendant offering to pay the money before the Sub-Registrar, no reply was received from the defendant. The lower appellate Court was of course prepared to state that though the Office of the Sub-Registrar was not the proper place for tendering the money it observed that if the defendant had really objected to that place but was prepared to receive the money and execute the conveyance at his house or any other place he could have informed the plaintiffs accordingly. The lower appellate Court also rejected the ground that non-production of the stamp papers would in any way go to show that the plaintiffs were not prepared to tender the money in time and get the sale deed executed. Ultimately the lower appellate Court held that there was valid tender and it was the defendant who had not executed the sale deed. The appeal was allowed and the suit was decreed. The plaintiffs were given three months time to deposit the sum of Rs. 4,280 and on such deposit the defendant shall execute the sale deed in favour of the plaintiffs.

2. Two questions arise for consideration in this second appeal. The first is whether there was a valid tender by the plaintiffs at any time prior to the suit under the agreement of reconveyance and the defendant had to reconvey if the sum of Rs. 4,280 was paid within a period of two years from 4th August, 1966. Though the plaintiffs have stated in the plaint that they have been pressing upon the defendant to receive the said sum of Rs. 4,280 and execute the sale deed on several occasions and the defendant was evading the same there is no evidence to show that at any time prior to the issue of the lawyer's notice dated 12th June, 1968 the plaintiffs at any time tendered the money and the defendant refused to execute the document. Even in the lawyer's notice it is not stated that the plaintiffs at any time earlier to the notice tendered the money and demanded execution of the sale deed. The demand for execution of the sale deed came only by the lawyer's notice dated 12th June, 1968. In this notice also it was only stated that the plaintiffs were prepared to pay Rs. 4,280 before the Sub-Registrar and called upon the defendant to execute the sale deed on or before 10th July, 1968. The question for consideration is whether this is a valid tender and is in accordance with the agreement of reconveyance? Ordinarily the vendor is entitled to insist on the payment of consideration at the time of execution of the sale deed and unless there is a contract to the contrary the purchaser could not insist on payment at the time of the registration. The term 'execution' does not include 'registration'. Therefore, unless the plaintiffs have stated that they were prepared to pay the money on execution of the document or simultaneously with the execution of the document it could not be stated that the tender was unconditional. When the plaintiffs stated that they will pay the money before the Sub-Registrar it could not be assumed that the execution of the sale deed and the presentation of the document will have to be simultaneous and which will have to be done before the Sub-Registrar's Office. It might mean that the defendant will have to execute the document and receive the payment only after the document was registered, or when the document was presented for registration before the Sub-Registrar. Under the agreement of sale the defendant was entitled for payment on execution of the sale deed. The tender should therefore have been to the effect that the plaintiffs were willing to pay the money on execution of the sale deed. In this case there is not even a confirmation in the lawyer's notice that they were having sufficient funds to pay the money and that they were having the stamp papers ready. In those circumstances it could not be stated that Exhibit B-2 the lawyer's notice was a valid tender.

3. Even so the learned Counsel for the respondents contended that since the suit itself was filed prior to the expiry of the period of two years fixed in the agreement to reconvey and in the plaint the plaintiffs have stated that they were ready and willing to perform their part of the contract and that they were having the money ready and willing to pay the moment the defendant agreed to execute the document, it would amount to a valid tender and on that basis the plaintiffs were entitled to a decree for specific performance. On the other hand, Mrs. Radha Gopalan, learned Counsel for the appellant contended that unless there is a repudiation of the contract by the defendant prior to the filing of the suit, formal tender before the filing of the suit was necessary and essential in order to get a decree for specific performance. In support of this contention, learned Counsel for the appellant relied on a decision of the Supreme Court in International Contracts Ltd. v. Prasanta Kumar : [1961]3SCR579 . In that case the facts were these. On 4th February, 1941 the plaintiff sold the property to the defendant for Rs. 10,000. On 10th February, 1941, there was an agreement for reconveyance within a period upto 10th February, 1943 for Rs. 10,000. The clause provided that if the purchaser shall on or before 10th February, 1943 pay, to the vendor Rs. 10,000 the vendor shall at the cost of the purchaser execute such conveyance as may be necessary for conveying and transferring its right, title and interest in the property free from encumbrances. On 26th November, 1942, the plaintiff issued a lawyer's notice stating that he was ready and willing to have the purchase completed on payment of Rs. 10,001. Along with that letter a draft conveyance also was sent for approval. By a further notice it was stated that the plaintiff was very eager to complete the purchase and full consideration of money therefore was lying idle in his hands awaiting the return of the relative draft conveyance as approved by the defendant. The defendant replied to that notice through his lawyer stating that there was no concluded or valid agreement for sale between the plaintiff and the defendant. Four months after the expiry of the period of two years from the date before which reconveyance was to be completed the suit was filed on 10th June, 1943. It was argued before the Supreme Court by the plaintiff that apart from the fact that there was a valid formal tender of the money within the period prescribed under the agreement of reconveyance, in. law since there was a repudiation of the contract by the defendant the plaintiffs were not under a legal obligation to make a formal tender.

4. The Supreme Court accepted this contention and held that in cases where there is repudiation of the contract by the defendant no question of formal tender of the amount to be paid arises and the question to be decided is not whether any money was within the power of the respondent but whether the defendant-vendor demanded and emphatically refused to carry out his part of the contract and intimated that the money will be refused if tendered. If there is evidence to show that there was repudiation there was no need for a tender. Relying on this decision the learned Counsel for the appellant contended that if there was no repudiation of the contract of reconveyance there should be a formal tender before the filing of the suit.

5. The proposition could not be accepted unconditionally. The formal tender even in a case where there is no repudiation would be necessary if only the suit was filed subsequent to the period fixed for the reconveyance. In fact, the decision of the Supreme Court relied on by Mrs. Radha Gopalan, learned Counsel for the appellant was one where the suit was filed subsequent to the period prescribed under the agreement to reconvey. If the suit was filed within the period agreed to under the deed of reconveyance for execution of the reconveyance document, then it is open to the intending purchaser to file the suit offering or tendering the amount in the plaint itself and stating his readiness and willingness to perform his part of the contract. This is obviously so for the reason that in the case of a suit filed after the expiry of the period prescribed under the agreement no question of tender in the plaint would arise at all as in the case of an agreement of reconveyance the time is the essence of the contract. When the suit is filed within the time he is complying with the terms of the agreement itself by offering to pay or tendering the amounts as per the agreement to re-convey. In this case, the suit was filed one day earlier than the last day agreed under the agreement of reconveyance. The plaintiffs could therefore tender the money even in the plaint and offer their readiness and willingness and prove the same. As already stated in the plaint, the plaintiffs have. specifically stated that they are ready and willing to perform their part of the contract, that they have got the money ready and that they are prepared to pay the same the moment the defendant agrees to execute the document. In his evidence the second plaintiff has stated that though money was not deposited in Court along with the plaint, the plaintiffs had money with them and that they did not deposit the same only because they were under the impression that they should make the payment on the disposal of the suit. It is also in evidence that the plaintiffs are owning a large extent of 40 acres of land and deriving sufficient income from which they could easily pay the sum of Rs. 4,280. In addition he has stated that the plaintiffs are always ready and willing to perform their part of the contract. I am therefore, satisfied that the plaintiffs are entitled to a decree and the second appeal is liable to be dismissed. But since the plaintiffs have filed the suit without tendering the amount prior to the suit and since the evidence showed that the defendant had not refused to execute the document but only was demanding payment of the money before execution the plaintiffs should not only bear the costs of the suit and the appeals but also should pay the costs of the defendant in all these proceedings, the suit, appeal and the second appeal. There will accordingly be a decree directing the defendant to execute the sale deed on payment of Rs. 4,280. The plaintiffs will be liable to pay the costs of the defendant throughout. Subject to the modification relating to costs, the decree of the lower appellate Court is confirmed. No leave.


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