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Nanik Lal Karmarkar Vs. Shankar Lal Shah and anr. - Court Judgment

LegalCrystal Citation
CourtKolkata High Court
Decided On
Case NumberA.F.A.D. No. 1019 of 1958
Reported inAIR1962Cal103
ActsContract Act, 1872 - Sections 51, 52 and 55; ;Specific Relief Act, 1877 - Sections 22 and 24
AppellantNanik Lal Karmarkar
RespondentShankar Lal Shah and anr.
Appellant AdvocateA.D. Mukherjee and ;Nirmal Kumar Ganguly, Advs.
Respondent AdvocateRabindranath Bhattacharyya, Adv.
DispositionAppeal dismissed
Cases ReferredStickney v. Keeble
- banerjee, j.1. this appeal, at the instance of the defendant, is directed against an appellate decree affirming a decree for specific performance of a contract of reconveyance, passed by a learned munsif.2. the plaintiff sold the disputed property to the defendant for a consideration of rs. 3000/-, on january 29, 1952. on the very next day there was an agreement (ex. 1) between the parties, by which the defendant agreed to reconvey the aforementioned property to the plaintiffs, it the latter' repaid to the defendant the sum pi rs. 3000/- within january 1953. time was made the essence of the contract under the said agreement.3. on the property conveyed by the plaintiff to the defendant, there were certain tenants and it was expressly stipulated in the agreement (ex. 1) that rents would be.....

Banerjee, J.

1. This appeal, at the instance of the defendant, is directed against an appellate decree affirming a decree for specific performance of a contract of reconveyance, passed by a learned Munsif.

2. The plaintiff sold the disputed property to the defendant for a consideration of Rs. 3000/-, on January 29, 1952. On the very next day there was an agreement (Ex. 1) between the parties, by which the defendant agreed to reconvey the aforementioned property to the plaintiffs, it the latter' repaid to the defendant the sum pi Rs. 3000/- within January 1953. Time was made the essence of the contract under the said agreement.

3. On the property conveyed by the plaintiff to the defendant, there were certain tenants and it was expressly stipulated in the agreement (Ex. 1) that rents would be realised by the defendant and the plaintiffs would have no concern therewith. Also a portion of the property admittedly remained in occupation of the plaintiffs.

4. On July 29, 1952, Sankarlal Saha, one of the plaintiffs, wrote a letter (Ex. 2) to the defendant asking from him a statement of rents realised from the tenants, so that the same might be taken into consideration in calculating the amount payable to obtain the reconveyance. This letter was written under a misapprehension because the realisations made by the defendant had no effect on the sum payable for obtaining reconveyance. The defendant caused a reply (Ex. 2a), to be sent through his pleader, to the aforesaid letter refusing to submit any statement as asked for. He rightly did so in our opinion.

5. On October 3, 1952, the plaintiffs through their pleader, sent a formal demand for reconveyance (Ex. 2b) to the pleader for the defendant.

6. In continuation of the letter (Ex. 2b) the plaintiffs' pleader also forwarded a draft deed of reconveyance to the defendant, along with his letter, dated October 25, 1952 (Ex. 2d).

7. On January 24, 1953, the pleader for the defendant wrote a letter (Ex. 2e) to the pleader for the Plaintiffs to the following effect:--

* * * * * * I have been instructed to give you notice that my client aforesaid is ready and willing to re-convey at your client's costs the properties so sold and give possession thereof to your clients if your clients act in accordance with the terms Ot the said agreement and also pay off the admitted amounts that my client has already spent, towards payment of arrears of rent of the land and electric charges and other necessary costs to 'make the properties free from incumbrances and charges etc.'

This letter was to all intents and purposes written in reply to the two letters sent on behalf of the plaintiffs but cleverly enough the letter (Ex. 2e) dd not refer to the plaintiff's letters. Moreover, the aforesaid letter contained a demand for more money than was lawfully payable by the plaintiffs to obtain the reconveyance. That letter, therefore, was not a letter, by which the defendant expressed his willingness to perform bis part, under the agreement for reconveyance.

8. Not having received back the draft conveyance approved by the defendant, the plaintiffs' lawyer sent a reminder, dated January 29, 1953 (Ex, 2f), asking for the approved draft.

9. On January 31, 1953, defendants' pleader replied (Ex, 2g) to the plaintiff's letter, dated January 29, 1953, to the following effect:--

' * * * * * * The copy of the draft conveyance as referred to in your letter under reply has been duly approved of as altered and amended by my client's pleader Sri A.G. Bhattacharyya and handed over to your pleader Sri C. C. Roy Chaudhuri in the 2nd week of January, 1953 through Joydev Patra, the registered clerk of Sri A. C. Bhattacharyya.

Please note that time was of the essence of the contract ana time as stipulated in, the Ekrarnaroa has already expired and that you, by your delay have forfeited your right to get back the property from my client.'

Mr. C.C. Roy Chaudhuri, plaintiffs pleader, replied to the aforesaid letter, on February 5, 1953 (Ex. 2J) denying receipt of the draft conveyance, in the following language:--

' * * * * * * My clients are surprised to note the contents of the letter as the draft does not appear to have been received back after approval. My clients being ready and willing to fulfil their part of the contract sent the draft for your approval as far back as 25-10-52 with the object of closing the transaction within the stipulated time. It does not now lie in your mouth to say that the time fixed by the agreement has expired owing to my client's delay resulting in forfeiture of their right under agreement. However, I have been further instructed to request you to let me know, whether a fresh draft is required to be sent to you. My clients are anxious to get the reconveyance and they will do the needful on hearing from you.'

To the aforesaid letter the following was the reply, dated February 7, 1953 (Ex. 2K), sent by the defendant's pleader:-

' * * * * * * It is a nice treat to see that you have at last feigned surprise to note the contents of my client's letter dated 31-1-53, but the fact remains that my client by his lawyer, Sri A. C. Bhattacharyya, had the draft conveyance duly approved and sent to your lawyer Sri C. C Roy Chaudhuri who, as my client believes will not deny receipt of the same. My client once again reiterates that time is of the essence of the contract and the time as fixed by the agreement has expired owing to your delay, latches and negligence. My client could have appreciated your sincerity and honesty, if you plainly communicated in writing to my client! your difficulty in the matter of securing the consideration money, etc. and asked for extension of time.

My client is an honest gentleman and wantsto give you one and the last chance. Please send immediately to my client a fresh copy of the original draft for fresh approval, if the approved draft as sent to your lawyer is otherwise lost or mislaid, and please note that my client hereby fixes 20th February, 1953, as the last date when execution and registration shall have to be completed without fail.'

There is one noteworthy thing in, this letter. On the controversy whether the draft was returned to the plaintiff by his lawyer, reference was made to G.C. Roy Chaudhuri, plaintiff's pleader, who, the defendant thought would support his story. But the defendant overlooked that in G.C. Roy Chaudhuri's own letter, there was the denial of the receipt of th2 letter. However, G.C. Roy Chaudhuri, the plaintiff's pleader, sent the following reply, dated February 12, 1953- (Ex. 2L) to the above letter:

* * * * * * * * My clients are not willing to enter into any controversy with regard to the statement contained in para 1 of the letter under reply as you have so kindly asked from my clients a fresh copy or the draft for approval. My clients are willing to have the reconveyance executed by you and if it cannot ba done within 20th February as proposed by you under some unforeseen circumstances you will kindly extend the time for a further period.

A draft copy of the reconveyance is shortly being sent to you for your approval.'

The letter revealed two infirmities in that it asked for more time and failed to send the copy of the draft reconveyance. The defendant took full advantage of the situation and by his letter, dated February 16, 1953 (Ex. 2 M), flatly refused to grant any further extension,

10. By his letter, dated February 18, 1956 (Ex. 2 N), the plaintiffs' pleader sent the draftconveyance and wrote as follows:-

'* * * * * a * * I request you on behalf of my said clients that you will kindly extend, the time for completion of the transaction for sometime more after 20th instant as prayed for by them in my last letter. My clients hope that you will not be so stringent as to see my clients homeless with their family members.'

11. This last draft Was received by the defendant too late and nothing appears to have been done by the defendant, until, on March 15,1953, the plaintiff's pleader G. C. Roy Chaudhuri wrote the following letter (Ex. 2-O) to the defendants' pleader :

'* * * * * * * * My clients are very much obliged to your client that he has kindly consented to extend the time for closing the transaction.

I have, therefore, been further instructed to request you to return the draft conveyance after approval stating the time granted in extension, so that the transaction may be completed by the time so granted.'

12. This letter reveals that no extension of time had been granted before the expiration ofthe 20th February 1950. Even on the date of the letter ( Ex. 2-0), there was no extension of timegranted but the allegation was that defendant had merely consented to extend the time. By what period the time would be extended was unknown and the defendant was, therefore, asked to state that in writing.

13. In reply to the aforementioned letter, the lawyer for the defendant wrote his letter, dated March 23, 1953 (Ex. 2P), denying that thedefendant had at all agreed to extend the time. He further stated that the defendant was not under any obligation either to approve the draft reconveyance or to send the same back to the defendant. He also stated that the draft reconveyance was received by the defendant in his office, at 1-45 p. m., on February 20, 1953, too late for completion of the transaction on the last date of the;extended period.

14. After having written the aforesaid letter the defendant took the offensive. By a letter dated April 18, 1953, his lawyer described the plaintiffs as licensees in respect of three rooms in the disputed premises, revoked the licence and called upon them to vacate. On May 27, 1953, the present defendant, himself as plaintiff, instituted T. S. 490 of 1953/T. S. 275 of 1955, in thecourt of a Munsif at Sealdah, claiming eviction of the licensees, who are the plaintiffs in the instant matter, from the three rooms in their occupation. He also asked for declaration of his title to the three rooms on the basis of his purchase, dated January 29, 1952. That suit was decreed on September 22, 1955 (Exts. E and F).

15. It was in these circumstances that the plaintiffs instituted the suit, out of which this appeal arises, claiming specific performance of the agreement for reconveyance.

16. The defendant contested the suit. He pleaded that the plaintiffs were not entitled to get a decree for specific performance as they had not performed their part of the contract, withinthe stipulated time. He also pleaded limitationand res judicata in bar.

17. The trial Court decreed the suit. Therewas an appeal to the Court of appeal below, at the instance of the defendant. That appeal failed and the decree of the trial court was affirmed.

18. The lower appellate court came to the following findings :-

(a) 'On a perusal of this correspondence it is abundantly clear that the plaintiffs have all along showed their willingness and readiness to perform their part of the contract, pay Rs. 3000/- and get the reconveyance from the defendant before January 1953. The defendant introduced a story at the bearing that the draft in question, received, by his lawyer on 4-10-52, was actually returned to the plaintiffs. This story cannot be believed.'

(b) 'Upon a consideration of the evidence on this point I am satisfied that the draft of reconveyance made over to the defendant's lawyer on4-10-52 was never returned to the plaintiffs ortheir Lawyer. It is thus proved that the plaintiffs could not get the reconveyance from the defendant within the stipulated period, i. e. January, 1953 On account of the defendant's wilful delay to fulfil the preliminaries to it. However, this question become unimportant in view of the fact mat the defendant by his letter ( Ex. 2/k) dated 7-2-53, voluntarily extended the date for performance of the contract to 20-2-53. We shall have to see whether the plaintiffs showed his readiness and willingness to perform their part of the contractwithin the date also.

* * * * * * This correspondence between the parties leaves no doubt in the mind of the Court that the plaintiffs did all that they were required to do for getting the reconveyance.'

(c) 'It was contended on behalf of the defendant that the plaintiffs are not entitled to get a reconveyance because they did not make an actual tender of the money. I do not think this plea can be entertained. The plaintiffs sent a draft of the reconveyance which they were asking for and asked the defendant to approve it. It will be meaningless and unnecessary for the plaintiffs to tender the money before knowing that the draft is approved and that the defendant is willing to execute it.'

(d) 'It was contended by the defendant that the plaintiffs were not capable of fulfilling the conditions imposed under the contract. It was said that they Had not the necessary money with them to obtain the reconveyance. I do not think this plea can be upheld. It appears from the Bainapatra (Ex. 5) and the oral evidence of P. W. 2 Amarendra that the plaintiffs entered into an agreement with the latter for selling a part of the suit land in May, 1953, and took advance of money from him from time to time. It is also in evidence that the plaintiffs received money from Amarendra and deposited it in Court in 1957 during the pendency of the suit.

* * * * * * * The plaintiffs could have raised money from Amarendra, if required earlier to that date, on the strength of the agreement (Ex. 5)'

(e) 'The last contention of the defendant was that the plaintiffs are not entitled to the reliefs asked for because they did not bring the suit within the stipulated period, that is 31-1-53 or 20-2-53 and because they did not deposit the money along with the plaint within 31-1-53 or 20-2-53, I am unable to give effect to this contention.'

'(f) The next point for consideration is whether tbe failure on the part of the plaintiffs to actually tender the amount of consideration in Court with the plaint bars the suit.

* * * * * * I have already held relying on the principle laid down in Protap Chandra v. Kali Charan : AIR1952Cal32 and Prasanta Kumar Sur v. International Contractors Ltd. : AIR1955Cal101 , that the plaintiffs were only required to show their readiness to pay the money within the stipulated period and wait till after that date expecting the defendant to changehis mind. I, therefore, hold that the plaintiffs suit will not be barred not being accompanied by deposit at the time of filing of the plaint.'

19. The propriety of the decree passed by the Court below is being disputed before us at the instance of the defendant-appellant.

20. Mr. Apurbadhan Mukherjee, learned Advocate for the appellant, contended before us that the conduct evidenced by the plaintiffs did not amount to readiness and willingness to perform their part of the contract; they prayed for time because they had not the money. They did not take proper steps to complete the transaction even within the extended time. Here was a case, Mr. Mukherjee contended, where delay defeated equity and the plaintiffs were no longer entitled ,to claim specific performance of the contract of reconveyance.

21. Elaborating his contentions, Mr. Mukherjee submitted that the payment of Rs. 3000/-, by the plaintiffs to the defendant, was a condition precedent and unless the plaintiffs paid the money to the defendant, which they never did within the contracted period, they were not entitled to call upon the defendant to execute the reconveyance. Mr. Mukherjee strongly relied on Clause (2) of the agreement (Ex. 1) in support of his contention. Clause (2) reads as follows :

'(2) If within the period you do not pay to me the said sum of Rs. 3000/- nor have (the reconveyance of) the property registered, then after the expiry of the period neither myself nor my heirs shall be bound to reconvey the property (Time is essence of this contract)'.

22. Mr. Mukherjee contended that the agreement consisted of reciprocal promises and there was an order of performance contained in the agreement, under which the plaintiffs were first to pay or to tender the money and then call upon the defendant to execute the reconveyance. He even went further and contended, as a matter of law, that in all cases of agreement to reconvey, the party desirous of having reconveyance must first pay or tender as evidence of willingness to perform his part of the contract. In this branch of his argument he relied, in the first place, on an observation by Sir Lancelot Sanderson in the case reported in 55 Ind App 243 : (AIR 1928 PC 174), Sakalaguna Nayudu v. Chinna Munuswami, where his Lordship said :

'The plaintiff, having made an adequate tender of the amount specified in the contract at the time mentioned therein, was entitled to call upon the defendants *** for a conveyance of the property.'

23. He further relied on the following observations by Mookerjee, J. (Roe, J. sitting with him) in 24 Cal LJ 90 : (AIR 1917 Cal 283), Manik Chandra v. Abhoy Charan :-

'The principle applicable to cases of this description is well-settled. The plaintiff who seeks specific performance of the contract has to show, first that he has performed Or been ready and willing to perform the terms of the contract on his part to be then performed; Bungsheedhur v. Cal-cutta Auction Co. (1862) 1 Hyde 45; Ram v. Mullick (1870) 14 Such WR 338; Gillis v. M'Ghee (1861) 13 Ir Ch R 48; and, secondly, that he is ready and willing to do all matters and things on his part thereafter, to be done : Walker v. Jeffreys (1842) 1 Hare 341; Vishvanath v. Bapu (1864) I Bom H. C. R. 262. A default on his part in either of these respects furnishes a ground upon which the action may be resisted (General Bill-posting Co. v. Atkinson, (1909) AC 118 (122)). In the case before us, it was obligatory upon the plaintiff as the purchaser to tender the balance of the purchase money, namely, Rs. 399 to the vendor defendant on Or before the 11th February 1911. This he did not do; consequently, there was a default on his part in the performance of an essential term of the contract. But he contends that this default is immaterial, for a tender of what has now been found by the Courts below to be the true amount of the unpaid parchase money, would have been of no avail, because, as the Subordinate Judge has found, the defendant was anxious to resile from the contract and would have unquestionably refused to accept the money. The argument in substance is that non-performance on the part of the plaintiff is really attributable to the default of the defendant, and the defence is not sustainable, because, as pointed out in Hotham v. East India Co. (1787) 1 TR 638, non-performance of the plaintiff is excused when that has resulted from the default of the defendant.'

24. He also, relied on certain observations contained in a decision in Nalini Nath Mitra v. Bipin Behari Das : AIR1956Cal525 wherein it was held that where the plaintiff failed to pay balance of the selami to the defendants under the contract within the stipulated time, it must be held that the plaintiff was unable to perform his part of the contract and the defendants were entitled to treat the contract as cancelled.

25. Lastly, he relied upon a decision of the Privy Council reported in AIR 1948 P. C. 192, Paul Couvreur v. M.G. Shapiro, in support of the contention that if the duty of taking steps necessary for effecting a transfer in his favour rested on the vendee and if the vendee failed to take such steps, he should not be heard to make a grievance of the vendor's failure to reconvey.

26. We are not prepared to accept this argument of Mr. Mukherjee, for reasons hereinafter stated:

27. The observation in 55 Ind APP 243 :(AIR 1928 PC 174) (supra), relied upon by Mr. Mukherjee, is not a legal proposition at all. Their Lordships treated the tender of the' money by the plaintiff, in the aforesaid case, merely as piece of evidence showing the readiness and willingness 6n the part of the plaintiff to perform his part of the contract. Their Lordships did not lay down as a general proposition of law that payment or tender oP the consideration was the only method of exhibiting readiness and, willingness. Then again in 24 Cal LT 90 :(AIR 1917 Cal 283) (Supra), the prior tender of the money was made obligatory under the agreement in that case. Their Lordships did not lay downa general proposition of law that without such a. prior tender a claim for specific performance can never be sustained; their Lordships also indicated the circumstances under which a plaintiff may be excused from making such a tender. The case reported in 97 Cal LJ 229 :(AIR 1958 Cal 525) was decided on its special foots and the failure to tender was attributed to inability of the plaintiff to perform the contract, on, the evidence adduced in that case. That case is no authority for the proposition contended lor Mr. Mukherjee.

28. Under Section 46 of the Contract Act, where, by the contract, a promisor is to perform his promise without application by the promisee and no time for performance is specified the engagement must be performed within a reasonable time. Under Section 48 of the aforementioned Act, when a promise is to be performed on a certain date and the promisor has not undertaken to perform it without application by the promisee, it is the duty of the promisee to apply for performance at a proper place and within the usual hours of business.

29. The law as to performance of reciprocal promises is, however, somewhat different from the manner of performance of promises which are not reciprocal. Under Section 51 of the Contract Act when a contract consists of reciprocal promises, to be simultaneously performed, no promisor need perform his promise unless the promisee is ready and willing to perform his reciprocal promise. Section 52 of the Act, how-ever, provides that where the order in which the reciprocal promises are to be performed is expressly fixed by the contract, they shall be performed in that order and, where the order is not expressly fixed by the contract, they shall be performed in that Order which the nature of the transaction requires. And Section 55 of the Contract Act is to the following effect:--

'Section 55. When a party to a contract promises to do a certain thing at or before a specified time, or certain things at or before specified times, and fails to do any such thing at or before the specified time, the contract, or so much of it as has not been performed, becomes voidable at the option of the promisee, if the intention of the parties was that time should be of the essence of the contract.

If it was not the intention of the parties that time should be of the essence of the contract, the contract does not become voidable by the failure to do such thing at or before the specified time; but the promisee is entitled to compensation from the promisor for any loss occasioned to him by such failure.'

30. The ordinary rule governing vendors and purchasers is that the payment of the consideration is to be simultaneous with the execution of the deed and shall be made at the time when the conveyance is executed by the vendor. In any particular case, however, the parties may agree to deviate from the ordinary rule. Unless therefore, there be any special contract, the parties are to follow the ordinary rule relating to payment between vendors and purchasers.

31. Whether in the instant case there was any special rule as to payment, agreed upon between the parties, now requires to be considered. We have already quoted, in this judgment, clause (2) of the agreement (Ex. 1). In our opinion the agreement, read as a whole, does not lay down any order for performance of the reciprocal promises but merely reiterates the normal practice as to payment of consideration and execution of conveyance.

32. Apart from any special contract it is not the law that the consideration money must be tendered as a condition precedent by the party aspiring for specific performance of a contract of reconveyance,

33. In a similar case reported in AIR 1923 Bom 15, Tribhovandas Varjivandas v. Balmukundas Kishoridas, Macleod, C. J. and Coyajee, J. observed:--

'But in a suit of this nature which is. really a suit for 'specific performance' we do not think that the strict law as to tender is applicable, and considering the negotiations which went on for several months, and the fact that the suit was filed before the three years had expired, and; also the fact that the defendants had been in possession of a portion of the village when they undertook to reconvey to the plaintiff, we see no reason why justice should not be done by directing the defendants to reconvey on payment of the consideration money.'

34. In L. R. 50 Ind App 41 : (AIR 1923 P.G 26), Venkatarayanim Garu v. Zamindar of Tuni, Lord Buckmaster took a matter of fact view of the law and did not consider prior tender of the consideration money necessary, where a tender might have taken a mere formality and the party to whom it was to be tendered would have refused to accept the money.

35. But, if under the order of performance of reciprocal promises expressly agreed upon, the tender of the money came first, then even though a party to the contract had wrongfully repudiated to reconvey, the party aspiring specifically to enforce the contract must perform the condition precedent, on his part, before he becomes entitled to the relief. This view finds support from the judgment of Lord Wright in , Edridge v. R. D. Sethna.

36. Since we have already held that undsr the reciprocal promises expressed in the agreement (Ext. 1) the plaintiffs were not bound to tender or deposit the money as a condition precedent, the decision reported in is not of relevant consideration and does not stand in the way of the plaintiffs in getting a decree for specific, performance.

37. We have discussed some of the case laws out of respect for Mr. Mukherjee's spacious argument on this point. In view of the interpretation that we put on Clause (2) of the agreement (Ext. 1), this discussion has only an academic value.

38. The next question for our consideration is whether time was the essence of the contractand having failed to perform their part of the contract within the agreed time the plaintiffs disentitled themselves to the relief prayed for.

39. The law on this point has been fully stated in the judgment of Viscount Haldane reported in L. R. 43 Ind App 26 : (AIR 1915 PC 83), Jamshed Kodaram Irani v. Burjorji Dhunjibhai:

'The law applicable to the point is contained in Section 55 of the Indian Contract Act, 1872, which provides that ''when a party, to a contract promises to do a certain thing, at or before a specified time, or certain things at or before specified times and fails to do any such thing at or before the specified time, the contract or so much of it as has not been performed, becomes voidable at the option, of the promisee, if the intention of the parties was that time should be of the essence of the contract.

Their Lordships do not think that this section lays down any principle which differs from those which obtain under the law of England as regards contracts to sell land. Under that law equity, which governs the rights of the patties in cases of specific performance of contracts to sell real estate, looks not at the letter but at the substance of the agreement in order to ascertain whether the parties, notwithstanding that they named a specific time within which completion Was to take place, really and in substance Intended more than that it should take place within a reasonable time. The principle is well expressed an what Lord Redesdale said in his wellknown judgment in Lennon v. Napier, (1802) 2 Sch. and Lef. 682 which was adopted by Knight Bruce L. J. in Roberts v. Berry, (1853) 3 De. G. M. and G. 284 at p. 289. The doctrine laid down in these cases was again formulated by Lord Cairns in Tilley v. Thomas, (1867) 3 Ch. 61 and by the House of Lords in the recent case of Stickney v. Keeble, 1915 A. C. 386. Their Lordships are of opinion that this is the doctrine which the section of the Indian statute adopts and embodies in reference to sales, of land. It may be stated concisely in the language used by Lord Cairns in (1867) 3 Ch. 61 (supra.) : 'The construction is and must be in equity the same as in a Court of Law. 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 (1853) 3 De G. M. and G. 284) (supra) 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. That is what is meant, and all that is meant, when it is said that in equity time is not of the essence of the contract. Of the three grounds mentioned by Lord Justice Turner 'express stipulations' requires no comment. The 'nature of the property' is illustrated by the case of reversions, trusts, or trades. The 'surrounding circumstances' must depend on the facts of each particular case.'

Their Lordships will add to the statementjust quoted these observations. The special jurisdiction of equity to disregard the letter of the contract in ascertaining what the parties to the contract are to be taken as having really and in substance intended as regards the time of its performance may be excluded by any plainly expressed stipulation. But to have this effect the language of the stipulation must show that the intention was to make the rights of the parties depend on the observance of the time limits prescribed in a fashion which is unmistakable. The language will have this effect if it plainly excludes the notion that these time limits were of merely secondary importance in the bargain, and that to disregard them would be to disregard nothing that lay at its foundation. Prima facie, equity treats the importance of such time limits as being subordinate to the main purpose of the parties, and it will enjoin specific performance notwithstanding that from the point of view oi a Court of law the contract has not been literally performed by the plaintiff ay regards the time limit specified. This is merely an illustration of the general principle of disregarding the letter for the substance which Court's of equity apply, when, for instance, they decree specific performance with compensation for a non-essential deficiency in subject-matter.

But equity will not assist where there has been undue delay on the part of one party to the contract, and the other has given him reasonable notice that he must complete within a definite time. Nor will it exercise its jurisdiction when the character of the property or other circumstances would render such exercise likely to result in injustice. In such cases the circumstances themselves, apart from any question of expressed intention, exclude the jurisdiction. Equity will further infer an intention that time should be of the essence from what has ppassed between the parties prior to the signing of the contract. (1867) 3 Ch. 61, where specific performance was refused, illustrates this class of transaction. But in such a case the intention must appear from what has passed prior to the contract, the construction of which cannot be affected in the contemplation of equity by what takes place after it has once been entered into.'

40. We have, therefore, to look to the surrounding circumstances of this case so as to ascertain how far the express stipulation as to the time for performance and the non-performance within the stipulated time affects the plaintiff's claim.'

41. We have already seen that January 31, 1953 was fixed, under agreement (Ex. 1), as the time limit within which the plaintiffs must Pay Rs. 3000/- to the defendant and obtain the revonveyance. The plaintiffs' first move in this respect was made on 'July 29, 1952, when they wrote the letter (Ex. 2) asking for an account of realisations made by the defendant from the tenants in the disputed property, so as to adjust the same against the money payable to the defendant under the agreement. They were not entitled to such adjustment and their first move must therefore be ignored.

42. The next move was made by the plaintiffs on October 3, 1952, when they formally asked for reconveyance and sent a draft deed, on October 25, 1952, for approval by the defendant (See Ex. 2d). The two replies sent to the plaintiffs; by the pleader for the defendant, show the defendant's disinclination to abide by the agreement. By the first of the said two letters (Ex. 2 e), the defendant asked for certain sums in addition to the money payable to him under the agreement, which he was clearly not entitled to do. By the second letter, (Ex. 2g), dated January 31, 1953, the defendant put forward a story that the draft was approved and returned to the plaintiffs' lawyer. This story has been found to be untrue On the evidence in the case, and in our opinion rightly so. Therefore the position is that the time which was fixed for the performance of the contract under the original agreement expired not because the plaintiffs were at 'fault but because the defendant himself stood in the way of the completion of the transaction within the time fixed. Moreover, the defendant himself atoned for his conduct by extending the time for completion by another twenty days, by his letter dated February 7, 1953 (Ex. 2K). We are not sure when that letter was received by the plaintiffs but in any event the same must: have been received before February 12, 1953, because on that day the plaintiffs' lawyer acknowledged receipt of the letter. For reasons of which we are not Sure, the draft reconveyance was not sent along with the said letter. Be that as it may, the draft was sent along with the letter, dated February 18, 1953 (Ext. 2N). If the defendant had approved of this draft at once, the transaction might have been completed within the extended period. The defendant, however, did not do so, on the plea that the draft was received by him too late, on February 20, 1953.

43. The Court of appeal below held that the plaintiffs had done all that was required of them to complete the transaction within the time. Reading the correspondence ourselves we are also of the opinion that the defendant's attitude towards the completion of the transaction was halfhearted and alternated between inclination and disinclination. The transaction was not completed, within the time agreed upon, largely because of the attitude of the defendant himself. The 'surrounding circumstances' of this case are such as would excuse the plaintiff's failure to complete the transaction within the agreed time. We, therefore, overrule the contention that delay on the part of the plaintiffs disentitled them to any relief. In our opinion it is not open to a defendant to cause the delay and to try to defeat the plaintiffs' claim on the ground of such delay.

44. For the reasons aforesaid we are of the opinion that the case was rightly decided by the court of appeal below and this second appeal must be dismissed with costs.

Niyogi, J.

45. I agree.

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