" 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18TH DAY OF DECEMBER, 2024 PRESENT THE HON'BLE MR JUSTICE S.G.PANDIT AND THE HON'BLE MR. JUSTICE RAMACHANDRA D. HUDDAR REGULAR FIRST APPEAL NO.1867 OF 2011 (SP) C/W REGULAR FIRST APPEAL NO. 1498 OF 2011 IN R.F.A No.1867 OF 2011 BETWEEN: 1 . ARJUNA K S/O LATE KUMAR AGED ABOUT 44 YEARS 2 . SMT. REKHA W/O ARJUNA K AGED ABOUT 43 YEARS BOTH ARE RESIDING AT OPP. VETERINARY HOSPITAL KODI ROAD, AIRODY VILLAGE POST: SASTHAN UDUPI TALUK AND DISTRICT-576 226 …APPELLANTS (BY SRI. A. KESHAVA BHAT, ADVOCATE A/W SRI. S.K. ACHARYA, ADVOCATE) AND: 1 . EDWARD LEWIS S/O FELIX LEWIS AGED ABOUT 34 YEARS RESIDING AT POST BOX NO.9050 ABU DHABI U.A.E-0644 9268 REPRESENTED BY GPA HOLDER MRS. PRAMILA CRASTA 2 W/O WILSON CRASTA AGED ABOUT 37 YEARS R/A AIRODY VILLAGE & POST UDUPI TALUK AND DISTRICT-576 226 2 . FELIX LEWIS S/O LATE ANTONY LEWIS AGED ABOUT 70 YEARS R/AT AIRODY VILLAGE AND POST UDUPI TALUK AND DISTRICT-576 226 …RESPONDENTS (BY SRI. VIGNESHWARA S. SHASTRY SENIOR COUNSEL FOR SRI. GURURAJ, ADVOCATE FOR R1 & R2) THIS RFA IS FILED U/SEC.96 OF CPC, AGAINST THE JUDGMENT AND DECREE DATED 30.06.2011 PASSED IN O.S.02/2009 ON THE FILE OF THE SENIOR CIVIL JUDGE, KUNDAPURA, PARTLY DECREEING THE SUIT FOR SPECIFIC PERFORMANCE. IN R.F.A No.1498 OF 2011 BETWEEN: 1 . MR. EDWARD LEWIS S/O FELIX LEWIS AGED ABOUT 34 YEARS R/AT POST BOX NO.9050 ABU DHABI, U.A.E REPRESENTED BY G.P.A HOLDER MRS. PRAMILA CRASTA W/O WILSON CRASTA AGED ABOUT 37 YEARS RESIDING AT AIRODY VILLAGE & POST UDUPI TALUK AND DISTRICT PIN CODE-576 101 2 . MR. FELIX LEWIS S/O LATE ANTONY LEWIS AGED ABOUT 70 YEARS R/AT AIRODY VILLAGE AND POST 3 UDUPI TALUK AND DISTRICT PIN CODE-576 101 …APPELLANTS (BY SRI. VIGNESHWARA S. SHASTRY SENIOR COUNSEL FOR SRI. GURURAJ, ADVOCATE) AND: 1 . MR. ARJUNA K S/O LATE KUMAR AGED ABOUT 44 YEARS OPP. TO VETERINARY HOSPITAL KODI ROAD, AIRODY VILLAGE POST: SASTHAN UDUPI TALUK AND DISTRICT PIN CODE -576 101 2 . SMT. REKHA W/O MR.ARJUNA K AGED ABOUT 43 YEARS OPP. TO VETERINARY HOSPITAL KODI ROAD, AIRODY VILLAGE POST: SASTHAN UDUPI TALUK AND DISTRICT PIN CODE-576 101 …RESPONDENTS (BY SRI. A. KESHAVA BHAT, ADVOCATE A/W SRI. S.K. ACHARYA, ADVOCATE FOR R1 & R2) THIS RFA IS FILED UNDER SEC.96 OF CPC., AGAINST THE JUDGMENT AND DECREE DATED 30.6.2011 PASSED IN O.S.NO.2/2009 ON THE FILE OF THE SENIOR CIVIL JUDGES, KUNDAPURA, PARTLY DECREEING THE SUIT. PLAINTIFFS THEREIN ARE NOT ENTITLING FOR SPECIFIC PERFORMANCE OF AGREEMENT OF SALE DATED 20.8.2008 AND DEFENDANTS NO.1 AND 2 THEREIN ARE LIABLE TO PAY RS.10,00,000/- AS DAMAGES TO THE PLAINTIFFS THEREIN. THE APPELLANTS HEREIN ARE PRAYING TO SETTING ASIDE THE ABOVE MENTIONED JUDGMENT AND DECREE IN O.S.NO.2/2009, IN SO FAR AS DECLINING TO GRANT DECREE FOR SPECIFIC 4 PERFORMANCE AND DECREE THE SUIT AS PRAYED FOR BY ALLOWING THE APPEAL. THESE REGULAR FIRST APPEALS HAVING BEEN RESERVED FOR JUDGMENT COMING ON FOR PRONOUNCEMENT OF THIS DAY, RAMACHANDRA D. HUDDAR J., DELIVERED/PRONOUNCED THE FOLLOWING: CORAM: HON'BLE MR. JUSTICE S.G.PANDIT AND HON'BLE MR. JUSTICE RAMACHANDRA D. HUDDAR CAV JUDGMENT (PER: HON'BLE MR JUSTICE RAMACHANDRA D. HUDDAR) These two appeals arise out of a single Judgment dated 30th June 2011 passed in OS No.2/2009 by the Sr.Civil Judge, Kundapura in a suit filed by the plaintiffs seeking the relief of specific performance of the agreement of sale dated 25.08.2008 directing the defendants to receive the balance sale consideration and to execute the registered sale deed. 2. RFA No.1498/2011 is filed by the plaintiffs challenging the rejection of their claim to grant the relief of specific performance of the agreement of sale (supra) and directing the defendants to pay Rs.10 lakhs as damages to the plaintiffs together with costs of the case. 5 Whereas, RFA 1867/2011 is filed by the defendants therein challenging the direction to pay the damages to the plaintiffs as directed by the trial Court and even challenged the findings of the trial Court with regard to ready and willingness to perform the contract, time as essence of a contract etc., 3. For the purpose of convenience, parties to these appeals are referred to as per their rank before the trial Court. Proceedings before the trial Court: 4. That plaintiffs filed the suit seeking the relief of specific performance of agreement of sale dated 25.8.2008 and directing the defendants to execute the registered sale deed by receiving the balance sale consideration amount on the ground that defendants being the owner of the suit schedule property so described in the plaint entered into agreement of sale on 25.8.2008 and agreed to sell the same for a sale consideration amount of Rs.24,50,000/-. It is specific case of the plaintiffs that in part performance of the contract, the first plaintiff paid Rs.5,00,000/- as 6 earnest money to the defendants on 25.8.2008 itself and to that effect, the defendants executed the separate receipt and acknowledged the same. It is stated that, as per the terms and conditions of the agreement, defendants agreed to clear the loan raised by them from Syndicate Bank, Saligrama Branch before they execute the sale deed in favour of first plaintiff or to his nominee by receiving the balance consideration amount of Rs.19,50,000/- within three months from the date of such agreement at the cost of first plaintiff. Even the defendants agreed to keep ready the RTC extract, receipt for settling the loan amount, assessment extract, plans and conversion order etc. to be handed over to the plaintiffs at the time of registration of sale deed. 5. It is alleged that as per the stipulations in the agreement, if the defendants fail to execute the sale deed, the plaintiffs are entitled to get the relief of specific performance of contract or in the alternative is entitled to get damages of Rs.10 lakhs from the defendants by approaching the Court of law. It is alleged that, the 7 plaintiff no.1 nominated the second plainitff as purchaser to pay the balance consideration and get the registered sale deed executed. The said fact was informed to the defendants but, the defendants started giving evasive replies and went on postponing to execute the sale deed without any lawful excuse. It is stated that, because of conduct of defendants in postponing the execution of the sale deed, plaintiffs issued a legal notice through their counsel on 20.11.2008, called upon the defendants to execute the sale deed with a request to execute the sale deed in favour of second plaintiffs. To this notice, defendants gave an evasive reply and avoided to perform their part of contract though the plaintiffs were and are ever ready to perform their part of contract as agreed. It is alleged that defendants have committed breach of contract, therefore, plaintiffs were constrained to file the suit and there is no question of invoking forfeiture clause as such occasion never arose. Hence, it was prayed to decree the suit. 8 6. The defendants appeared before the trial Court and it was defendant no.1 filed written statement same was adopted by defendant no.2. So far as execution of agreement of sale and the terms and conditions, so also receipt of Rs.5,00,000/- by them is admitted. 7. The rest of the plaint allegations so made by the plaintiffs are stoutly denied by the defendants. It is contended that, defendants have made all their efforts to get survey of their land, prepare the sketch. Even they issued several reminders to the plaintiffs, but, plaintiffs never came forward to give the balance consideration amount and get execution of the registered sale deed. Even the name of the nominee was enquired into. It is contended that, it is plaintiffs who have committed breach of sale agreement so also the contract entered into. Instead of performing their part of contract, they gave threat to defendants by illegal means. In the meanwhile, the time stipulated was expired but, even then, in good faith and on humanitarian grounds, they issued legal notice on 1.12.2008 and requested the first plaintiff to get 9 the registered sale deed executed. But, the plaintiffs issued a false reply notice on 1.12.2008 with a false story and plaintiffs were never ever ready and willing to perform their part of contract. Therefore, the said agreement is frustrated by breach of contract on the part of the first plaintiff. Therefore, there is no question of any performance of the contract by the defendant which is already expired. Hence, it is prayed by the defendants to dismiss the suit. Proceedings before the trial Court: 8. In view of the rival pleadings of both the parties, the learned trial Court framed in all five issues and two additional issues. They read as under: \"1. Whether the plaintiffs prove that they are always ready and willing to perform their part of contract? 2. Whether defendants prove that the plaintiff committed breach of their part of contract i.e., agreement of sale dated 25.08.2008? 3. Whether defendants prove that they validly cancelled the agreement of sale dated 25.08.2008? 4. Whether plaintiff is entitled for the relief sought? 10 5. What order or decree? Additional Issues: 1. Whether defendants prove that the agreement dated 25.08.2008 was rescinded for non-performance and breach of terms and conditions by the 1st plaintiff? 2. Whether defendants prove that the time is the essence of contract as per agreement dated 25.08.2008? 9. To prove the case of the plaintiffs, the first plaintiff entered the witness box as PW.1 and got marked Ex.P1 to P16 and closed plaintiff's evidence. To rebut the evidence of the plaintiffs, defendant no.1 entered the witness box as DW1 and got marked D1 to D3 and closed defendant's evidence. 10. The learned trial Court on hearing the evidence of both the side and on assessment of evidence, held that the plaintiffs have proved their readiness and willingness to perform their part of the contract and defendants have committed breach of contract on their part and defendants were able to establish that time was essence of contract and ultimately decreed the suit of the plaintiff in part rejecting the prayer to grant the specific performance of 11 contract and directed defendants to pay damages of Rs.10 lakhs to the plaintiffs together with cost. This is how now both plaintiffs and defendants by filing their independent appeals are before this court challenging the impugned judgment of the trial Court. Submission of Appellant/Plaintiff's Counsel: 11. It is submitted by the counsel for the plaintiffs that as the facts narrated above do establish most of the factual features with regard to the agreement of sale in between plaintiffs and defendants dated 25.8.2008 is admitted so also receipt of earnest money by the defendants. Sri Vighneshwar Shastri learned senior counsel for the plaintiffs would submit that, with the time stipulated to perform the contract, plaintiff requested defendants to execute the sale deed by receiving the balance consideration amount but, on one or the other pretext these defendants went on postponing. These defendants wanted to sell the property to clear off the loan raised from the then Syndicate Bank, Saligrama Branch and also to purchase alternative property for their use and 12 occupation. Even defendants by receiving the earnest money have cleared off the said loan and also made all arrangements to purchase alternative property for their use and occupation. Though the plaintiffs were and are ever ready, it was defendants who committed breach of contract and not plaintiffs. According to his submission, PW.1 has spoken in line with the plaint averments and his evidence is supported by documentary evidence. He would further submit that, though the learned trial Court came to the conclusion that plaintiffs have proved agreement of sale, receipt of the earnest money and readiness and willingness to perform the contract by the plaintiffs, but, on the question of hardship has wrongly negatived the relief of specific performance of contract. As the plaintiffs are deserving to get such a relief in view of the facts and circumstances brought on record, he would submit that, the learned trial Court has committed illegality and error in passing the impugned judgment which according to him requires interference by this Court. In support of his submission, learned counsel for the appellants relied upon the following judgments: 13 i. M.S. Madhusoodhanan and another v. Kerala Kaumudi Pvt.Ltd. and others, AIR 2004 SC 909. ii. Sughar Singh v. Hari Singh (dead) through legal representatives and others, (2021) 17 SCC 705 iii. Jugraj Singh and another v. Labh Singh and others, AIR 1995 SC 945 iv. Shenbagam and others v. KK Rathinavel, Civil Appeal No. 150 of 2022. v. U.N. Krishnamurthy v. A.M. Krishnamurthy, (2023) 11 SCC 775. vi. Man Kaur (Dead) by Lrs v. Hartar Singh Sangha, (2010) 10 SCC 512. vii. Desh Raj and Ors. v. Rohtash Singh, AIR 2023 SC 163 Submissions of Counsel for Respondents/ Defendants: 12. As against this submission, learned counsel for defendants Sri A.Keshav Bhat with all vehemence submits that the trial Court has committed illegality in holding that plaintiffs were ever ready and willing to perform their part of contract and there is failure on the part of defendants to execute the sale deed. He would further submit that as the time was essence of contract, within the stipulated time, the plaintiffs never came forward. They created confusion 14 to the defendants to execute the sale deed to whom? i.e. either to plaintiff no.1 or plaintiff no.2. Because of this confusion, it was not possible for the defendants to execute the sale deed. In the mean time, stipulated time expired and now plaintiffs on the guise of findings of the trial Court cannot seek the relief of specific performance of contract as they prayed in their suit. 13. In support of their respective submissions both the counsel relied upon the respective evidence lead by both the parties. 14. Having heard the arguments of both the side, we have given our thoughtful consideration to the arguments of both the side and perused the trial Court records and also grounds urged in the respective appeal memos. 15. In view of the rival submissions of both side, the following points arise for our consideration: (i) Whether the findings of the trial Court regarding rejection of the claim of the plaintiff for specific performance of contract and 15 granting damages to them is perverse, capracious and require interference by this Court? (ii) Whether the dismissal of the claim of the plaintiff on the ground of hardship is just and proper? (iii) What order? The point Nos. 1 and 2 require common discussion: 16. In this case, most of the factual features in between plaintiffs and defendants are admitted. They are: I. The defendants being the owners of suit schedule properties agreed to sell the same to the plaintiffs by executing agreement of sale on 25.8.2008 in favour of plaintiffs. In part performance of the contract, the first plaintiff paid Rs.5 lakhs to the defendants out of the total sale consideration and this was acknowledged by the defendants by executing a receipt to that effect on 25.8.2008. The defendants wanted to purchase alternative property for their use and occupation therefore, they decided to sell the suit schedule property. 16 II. As per the stipulations in the agreement, defendants have to clear the loan borrowed by them from the then Syndicate Bank, Saligrama Branch before execution of sale deed and they should not a create any mortgage, lien, assignment or transfer or alienation in respect of the suit schedule property which was agreed to be sold for the sale consideration of Rs.24,50,000/- in all and they had to execute the sale deed either in favour of the plaintiff or to his nominee by receiving balance consideration of Rs.19,50,000/- within three months from the date of agreement of sale at the cost of the plaintiff. III. As per the agreement, the defendants must keep the RTC extracts, receipt for having cleared the loan extract of assessment register, plans and conversion order and handover the same to the first plaintiff at the time of execution of the sale deed and put the plaintiff no.1 or his nominee in possession of the schedule properties. IV. Thus, the agreement of sale dated 25.8.2008 is admitted document between plaintiffs and defendants. 17 V. Plaintiffs issued legal notice on 20.11.2008 to the defendants and called upon them to execute the sale deed by performing their part of contract by receiving the balance consideration amount as stipulated in the agreement. VI. To this notice, a reply notice was addressed by the second defendant which was received by the counsel for the plaintiff on 24.11.2008 and another reply was also issued by the defendants on 24.11.2008 itself admitting the agreement of sale and the terms and conditions incorporated therein. VII. Plaintiffs issued reply notice on 1.12.2008 to the said reply notice, accepting the willingness of the defendants to execute the sale deed in favour of second plaintiff by asking them to inform the date and time and where he should meet the defendants for execution of registered sale deed. The above narrated facts are admitted between both the parties which need not be proved. 18 17. The only grievance of the plaintiffs is that, despite plaintiffs are ever ready and willing to perform their part of contracts, the defendants did not execute the sale deed and even there is no rescission of contract therefore, the question of the forfeiture of advance amount of Rs.5 lakhs by the defendants is illegal and the learned trial Court has committed grave error in negativing the relief so claimed by the plaintiffs. Whereas, it is the specific defence of the defendants that as the plaintiffs did not come forward to show their ready and willingness to perform their part of contract by keeping the balance consideration ready within the time stipulated in the agreement of sale therefore, automatically by efflux of time, the said agreement come to an end and there was a rescission of contract, but, the learned trial Court has wrongly awarded damages to be paid to the plaintiffs by the defendants. As per the defendants, in fact plaintiffs are not entitled for any relief much less claimed in the plaint. 19 18. Now we have to ascertain that whether the plaintiffs are able to prove their case with acceptable evidence or otherwise. 19. PW.1 being the plaintiff no.1 has reiterated the plaint averments in his evidence on oath by filing his affidavit in the shape of his examination-in-chief and also got marked Ex.P1 to P13 in support of his evidence. The document so produced by the plaintiffs in the shape of Ex.P1 to P13 are not denied by the defendants. This PW.1 is cross-examined by the counsel for the defendants at length. It is an admitted fact between both the sides that, plaintiff PW.1 is residing abroad and once in two years he comes to his native place on 21 days leave. It is his evidence that, his parents informed him about decision of the defendants to sell the suit schedule property. Accordingly, when he went to the suit schedule property to see the same, he had discussion with the defendants and defendants agreed to sell the suit schedule property for a valuable consideration so mentioned in the agreement of sale. Though intensive cross-examination is directed to 20 this witness, but, nothing worth is elicited from his mouth. In the cross-examination itself, it is elicited about receipt of advance consideration amount of Rs.5 lakhs. By utilizing the same defendants have cleared their loan borrowed from the then Syndicate Bank. According to his evidence, on the date of registration of the sale deed itself, defendants had to handover the possession to the plaintiffs. It is stated by PW.1 that, by receiving the advance amount, the defendants had to make alternative arrangement for their residence. It is suggested that, to purchase the suit schedule property, the defendants have paid advance money to the owner of another house which they intended to purchase. To this suggestion, PW.1 deposed ignorance. But, this suggestion goes to establish that, defendants had definite mind to sell the suit schedule property and by receiving the advance consideration amount, they wanted to clear the loan raised from the bank and purchase residential accommodation for their use and occupation. 21 20. It is his evidence that, after the execution of the agreement of sale dated 25.8.2008, he went abroad on 16.09.2008. He did not file any application for the purpose of measurement of the schedule properties and did not enquire defendants about the same. Whereas, his father put the signature to the notice issued for measurement. They are at Ex.D1 and D2. It is suggested that, these Ex.D1 and D3 were prepared after three months of agreement. This suggestion is admitted by PW.1. That means even beyond three months, the aforesaid documents which were agreed to be obtained by the defendants were obtained by them. He states that, when the said agreement took place, he had knowledge that within three months he could not return. He volunteers to say that, he requested the defendants to execute the sale deed in favour of his father plaintiff no.2. This information was furnished to the defendants orally by him. According to him, when Ex.P6 was issued, he was at abroad and his father and sister gave instructions to the Advocate to issue Ex.P6 notice. He speaks with regard to his readiness and willingness to perform his part of 22 contract and ready with the balance consideration in his examination in chief. This fact is not denied throughout the cross-examination. Even a single sentence is directed to PW.1 that plaintiffs were not having any financial capacity to pay the balance consideration amount. There were exchanges of notices in between them. The other part of the cross-examination so directed to PW.1 would not help the case of the defendants to prove their defence. 21. So far as documentary evidence produced by the plaintiffs, Ex.P1 and P2 are the RTC extracts. The contents of these documents are not denied by both the parties. The most vital document is, Ex.P3 which is an admitted document between both the parties named as 'agreement of sale' in respect of sale of immovable property. It is agreed that the sale deed has to be executed within three months as per Clause-IV of the agreement of sale. Even at Clause-VIII a forfeiture clause is mentioned. Clause No.IX is that, if the plaintiffs intend to get the sale deed executed, as per the suggestion made by Plaintiff no.1, in the name of such person, the 23 defendants have to execute the sale deed. This fact is not denied by the defendants. 22. Ex.P4 is the receipt dated 25.8.2008 for having received Rs.5 lakhs from the plaintiff as an advance amount in respect of the subject property which was agreed to be sold for Rs.24,50,000/-. Ex.P5 is the general power of attorney produced by the plaintiffs constituting Mrs.Pramila Cresta as his power of attorney. Ex.P6 is the legal notice issued by the plaintiff's counsel on 20.11.2008 narrating the contents of the agreement of sale showing readiness and willingness to perform the contract and even it is recited that, defendants were under obligation to clear the loan borrowed from the then Syndicate Bank, Saligrama Branch and should not create any mortgage, lien, assignment, transfer or alienation in any manner and shall execute the sale deed by receiving the balance consideration amount by preparing a document so stated. 23. It is made clear in the said notice that, plaintiff no.1 nominated his father plaintiff no.2 as the vendee in whose name defendants to execute sale deed by receiving 24 the sale consideration. It is stated that, unfortunately defendants gave evasive replies and went on postponing the execution of ale deed. 24. Receipt of this notice is not denied by the defendants which was sent under Registered Post acknowledge. Those documents are produced at Ex.P7 to P11. Defendant no.2 issued a reply as per Ex.P12 to the counsel for the plaintiff admitting the transaction entered into between plaintiff and defendants. Her grievance in Ex.P12 is that, the said notice was issued in English and she requested to issue letter or notice in Kannada. She has understood that it was pertaining to sale of suit schedule property. It is brought to the notice of the counsel for the plaintiffs that, in whose name, they have to execute the sale deed is in confusion as it was insisted to execute the sale deed in the name of father of plaintiff, in the name of his sister brother etc., In the absence of her husband, she has issued this reply notice. Ex.P13 came to be issued by the defendants to the counsel for the plaintiff admitting the whole transaction through the 25 counsel for the defendants and stated that, to intimate the plaintiff no.1 to get ready with balance sale consideration amount and to inform the plaintiffs about the place and time where the sale deed is to be executed, it was cautioned that otherwise, the defendants would apply forfeiture clause. 25. To this plaintiff's counsel issued reply notice stating that plaintiff no.1 informed defendants that he nominated plaintiff no.2 as his nominee to get the sale deed executed and plaintiffs are ever ready with the balance consideration amount and it is plaintiff no.2 would pay the same. This notice was issued on 1.12.2008. In this reply notice, it was made clear by the plaintiffs that, as the plaintiffs are ever ready, there is no question of any forfeiture of the advance amount. To this, counsel for the defendants again replied for the first time stating that, though they admit the agreement of sale and transactions therein but, plaintiffs failed to perform their part of contract within the time limit, therefore, it is stated \"my clients have decided not to sell their property but, to get 26 settled in the said property by renovating the house thereon. Thus sale agreement is frustrated by the breach of a contract on the part of your client's time. Hence, the question of performance of the expired contract of sale does not arise at all.\" It is further stated that, defendants have experienced painful and hardship by entering into sale agreement with defendants and decided to refund the advance money. 26. This has made the plaintiffs to file the suit seeking the relief stated above. To show that plaintiffs were having funds in their account, the account extract Ex.P16 is produced for the period commencing from 1.11.2008 to 31.3.2009. It is marked without any objection from the defendants. The outstanding credit balance is shown at Rs.22,61,841/- as on 20.03.2009. The learned counsel for the plaintiffs submits that as on 10.02.2009, there was a balance of Rs.19,34,309/-. That means, the plaintiffs were having sufficient financial capacity to meet the balance consideration amount. 27 27. Whereas, DW.1/defendant no.1 reiterates the contents of written statement admitting the agreement of sale, receipt of advance money etc., Even he has stated that, since the registration of the sale deed shall be accompanied with the survey sketch to be prepared which is required to be signed by both the seller and purchaser. According to him, he has made all efforts on his part to get the property measured and to get the sketch. He admits that, plaintiff no.2 signed the application and he made all efforts to inform the plaintiffs to pay the balance consideration and get the sale deed registered personally in the name of his nominee. This sentence spoken to by DW.1 do not find place in his pleadings effectively. It is his allegation that, plaintiff no.1 has failed to perform his part of contract within the stipulated time as the time was the essence of contract as agreed by the parties to the sale agreement. He says that, on account of failure of the parties and non-co-operation to get the registered sale deed executed by making payment of balance consideration amount within the stipulated time, he could have purchased the proposed house property for his 28 convenience. He states, thereby he has been put to inconvenience loss and damage. For the first time, he says so in his examination chief without any pleadings. He too relies upon two documents. In unequivocal terms in his cross-examination, he admits the contents of Ex.P3, receipt of Rs.5 lakhs under Ex.P4. He also admits that, in the said Ex.P3, name of the plaintiff's father is mentioned Felix Luis. He admits that, within the time stipulated if the plaintiffs pay the balance consideration they were ready to execute the sale deed. he admits that, himself and second plaintiff together filed an application before the Tahsildar for the purpose of measurement of the schedule property. He admits about issuance of notice on 20.11.2008 as per Ex.P6. Even he admits that in the said notice, as requested by the defendants, the date, time and place have been mentioned by the plaintiffs to execute the sale deed. According to him, his Advocate must have replied to the plaintiffs. He states that on receipt of Ex.P14, they informed about time and place of execution of sale deed and they were ready for the same. He states that but, the plaintiff did not come forward. He states that even after 29 execution of Ex.P14 they were ready to execute the sale deed. Thus, it is his evidence that, because of the mistake of the plaintiffs, they could not execute the sale deed. 28. He further deposes ignorance that, whether the plaintiffs had kept the amount to pay the balance consideration amount. He never denies about readiness with the cash by the plaintiffs. Further he deposed ignorance with regard to loss caused to plaintiffs. In para.16 of the cross-examination, he admits as under: \"¤¦ 3 PÀgÁgÀÄ¥ÀvÀæzÀ°è ¤UÀ¢ ¥Àr¹zÀ CªÀ¢AiÀÄ£ÀÄß C £ÀAvÀgÀªÀÇ ªÀÄÄAzÀĪÀj¹zÉÝÃ£É JAzÀgÉ ¤d. £ÁªÀÅ ¤¦ 3 PÀgÁgÀÄ¥ÀvÀæªÀ£ÀÄß gÀzÀÄÝ¥Àr¹®è. DzÀgÉ ¤UÀ¢vÀ 3 wAUÀ¼À CªÀ¢ü ªÀÄÄV¢gÀĪÀÅzÀjAzÀ ¤¦ vÁ£ÁVAiÉÄà gÀzÁÝVzÉ.\" 29. But, according to him, as the sale deed was not executed within three months, it is cancelled. But, even after three months according to his evidence, the period is extended and there was no cancellation or rescission of contract. How after three months, the said agreement rescinded is not explained by the DW.1 30. It is suggested that, these defendants have not given any advance amount towards purchase of other property for their use and occupation but, this suggestion 30 is denied by him and such a payment is not imaginary according to him. That means, on getting the advance amount, he has utilized the same not only for clearing the loan so borrowed from Syndicate Bank but, also has given advance to purchase a new property for their occupation. Ex.D1 is the notice and Ex.D2 is the sketch issued by the Surveyor and Ex.D3 is the joint statement of defendants before the surveyor. 31. Thus, on reading the entire evidence both oral and documentary, it shows that the plaintiffs have pleaded and proved the agreement of sale Ex.P3 and their ready and willingness to perform their part of contract. The learned trial Court has rightly given findings to that effect in its judgment which are also challenged by the defendants by filing separate appeal stated above. 32. The learned counsel for the plaintiffs in support of his submission relied upon various judgments stated above, wherein it has been laid down that, when and how the relief specific performance can be granted etc. It is settled that, in case of immovable property time is not the 31 essence of contract. But, in this case even after the expiry of three moths' period as per the evidence of DW.1 the said period was extended. When exactly the documents Ex.D1 and D3 were obtained is not made clear. Most of the factual features are admitted by the defendants. The learned counsel for the plaintiffs submit that the grant of relief of specific performance is discretionary as provided under Section 20 of the Specific Relief Act, 1963. As the most of the facts in this case are admitted and even the trial Court has observed and given a finding that the plaintiffs are able to prove most of the issues in their favour, he submits that the trial Court ought to have exercised its discretion and granted the relief of specific performance of the contract. 33. In this regard, he relied upon a judgment in the case SUGHAR SINGH vs. HARI SINGH (DEAD) THROUGH LEGAL REPRESENTATIVES AND OTHERS, reported in (2021) 17 SCC 705 and submits that, the principles laid down with regard to discretion are aptly applicable to the present facts of the case. According to his submission, in view of the fact so brought on record by the 32 plaintiffs and clear admissions of the defendants, the balance tilts in favour of the plaintiffs, as the plaintiffs are deprived of their possession because of this litigation though they were ready to perform their part of the contract. He submits that, despite receiving Rs.5 lakhs and making use of the same for the purpose so stated in the agreement of sale and as admitted by DW.1 and despite execution of agreement of sale, now the defendants all of a sudden expressed their unwillingness to execute the sale deed. 34. On appreciation of evidence, the learned trial Court answered most of the issues in favour of the plaintiffs. Though challenged by the defendants but, in view of the evidence brought on record as submitted by the counsel for the plaintiffs except the question of hardship, the trial Court has rightly observed regarding proof of agreement of sale, ready and willingness to perform the contract. The learned trial Court concluded that, the so called agreement of sale dated 25.8.2008 to sell the schedule property in favour of plaintiffs for a 33 valuable consideration and its validity was extended as per the admission of DW.1 and receipt of advance amount so also acknowledgement to that effect. 35. The learned trial Court rightly appreciated that these defendant agreed to sell the schedule property in favour of the plaintiffs by receiving the balance consideration amount and has not doubted the payment of balance consideration amount and also readiness of the plaintiffs to perform their part of contract by paying balance consideration amount as they were holding sufficient amount in their account as credit balance. 36. Though it is vehemently submitted by the counsel for the defendants that the ingredients of Section 16(c) of the Specific Relief 1963, (herein after 'Act') is not complied by the plaintiffs but, it is not so. As it is settled position of law laid down by the Hon'ble Apex Court in various judgments that, for determining the readiness and willingness pleadings have to be read as a whole. The pith and substance being that `readiness and willingness' has to be in spirit and not in the letter form. In para.22 of the 34 aforesaid judgment, it is observed by the Hon'ble Apex Court with regard to application of Section 16(C) of the Specific Performance Act as under: \"22. Considering the aforesaid facts and circumstances, the High Court has committed a grave error in holding the issue with respect to readiness and willingness against the plaintiff solely on the ground that there are no specific averments/pleadings in the plaint as required under Section 16(c) of the Act. Considering the fact that initially payment of Rs.25,000 was made at the time of execution of the agreement to sell and further sum of Rs.15,000 in two installments were paid at the time when the subsequent two documents were executed for extension of time and even the time was extended at the instance of Defendant 1 and the balance amount of Rs.16,000 was to be paid at the time of execution of the sale deed, it can safely be said that the plaintiff was always ready and willing to perform his part of the contract under the agreement to sell.\" 37. With regard to the ready and willingness to perform the part of the contract, one has to read the provisions of the Section 16 of Act. Under this Section, the plea about ready and willingness of plaintiff is specifically available to the vendor or his legal representatives. The law says that, it is personal to him. This provision provides that the plaintiff must plead and prove that he has always been ready and willing to perform his part of the essential terms of the contract. 35 The continuous readiness and willingness at all stages from the date of the agreement till the date of the hearing of the suit need to be proved. The trial Court has specifically observed in its judgment that, the plaintiffs are able to prove their readiness and willingness to perform their part of the contract. This finding though challenged by the defendants by filing separate appeal, but in view of the evidence brought on record by the defendants and as well as the admissions of DW.1 given in the cross- examination proves the said plea. Though the defendants claimed that, plaintiffs have not established the said plea, since the date of the contract as per evidence PW.1, has specifically stated about continuous ready and willingness to perform their part of the contract. The learned counsel for the plaintiffs relied upon a Judgment of the Hon'ble Apex Court in between JUGRAJ SINGH AND ANOTHER vs. LABH SINGH AND OTHERS reported in AIR 1995 SC 945, wherein the scope of Section 16(c) of the Act, has been discussed. Likewise, various judgments have been relied by both side and these judgments specifically laid down the law that Section 16(c) of Act bars the relief 36 of specific performance of a contract in favour of a person who fails to aver and prove his ready and willingness to perform his part of the contract. 38. It is laid down by the Hon'ble Apex Court in the case of U.N. KRISHNAMURTHY (SINCE DECEASED) THR. LRS. vs. A.M. KRISHNAMURTHY in Civil Appeal No.4703/2022 decided on 12.07.2022 that; in view of the Explanation (i) to clause (c) of Section 16 of the Specific Relief Act, it may not be essential for the plaintiff to actually tender money to the defendant or to deposit money in Court, except when so directed by the Court, to prove readiness and willingness to perform the essential terms of a contract, which involves payment of money. However, explanation (ii) says the plaintiff must aver performance or readiness and willingness to perform the contract according to its true construction. 39. Though the learned counsel for the defendants relied upon various judgments in support of his submission but the evidence so brought on record clearly show that, in this case, the plaintiffs have pleaded their readiness and 37 willingness to perform their part of the contract and also as per the documents produced and the oral evidence of PW.1 clinchingly establish that, the plaintiffs have proved the said ingredients with legal and acceptable evidence. 40. Further more, from the analysis of the various judgments of the Hon'ble Apex Court with regard to the relief of specific performance of a contract; it is clear that in the case of a sale of immovable property, there is no presumption as to time being the essence of contract. Even, if it is not of the essence of the contract, the Court may infer that it is to be performed in a reasonable time, if the conditions are evident i.e., as held in the case of CHAND RANI v. KAMAL RANI reported in (1993) 1 SCC 519. 1. From the express terms of the contract; 2. From the nature of the property; and 3. From the surrounding circumstances, for example: the object of making the contract. 41. The defendants have taken up a contention that, under the said transaction, time was the essence of a contract and within three months from the date of 38 agreements, the plaintiffs have not come forward to get the sale deed executed by paying the balance consideration amount. But the stipulation was that, the defendants have to prepare the documents, get the revenue documents along with sketch etc. It is not the case of the defendants that within the time so stipulated in the said Agreement-Ex.P3, they could get all the documents required for registering the sale deed. It has come in the evidence of DW.1 that, even after three months period as stipulated in the agreement, it was extended. Therefore, if the principles laid down in CHAND RANI (supra) are applied to the facts of the present case, there were express terms of the contract to get the documents prepared by the defendants and they have to clear of the loan borrowed from the then Syndicate Bank, Saligrama Branch. The property involved in this case is immovable property. The object of making the contract by the plaintiffs with the defendants was to have the property of their own and defendants intended to have the alternative property for their own use and occupation. This fact has been spoken to by PW.1 in his evidence and 39 he is consistent throughout his cross-examination. The clauses in the agreement of sale do establish that, plaintiffs have proved the ingredients to grant the relief of a specific performance of contract as averred in the plaint. 42. In a judgment of Hon'ble Apex Court in the case of GADDIPATI DIVIJA AND ANOTHER vs. PATHURI SAMRAJYAM AND OTHERS reported in 2023 SCC OnLine SC 442 in Para-34, has observed as under: \"34. However, the set of facts and circumstances in Siddamsetty (supra)were substantially different from the case at hand. The relevant portion of the said judgment is reproduced as under: “33. At the outset, this Court has perused Clause 3 of the agreements, which is in two parts. The first part provides for the purchaser's obligation, while the second part details the obligation of the vendors to provide the requisite certificates. Although both the obligations were required to be completed within the stipulated period of three months, there is a substantive difference between these two sets of obligations. The obligation upon the vendors concerned was production of certain certificates, such as income tax exemption certificate and agriculture 40 certificate. No consequences were spelt out for non-performance of such obligations. Whereas the obligation on the purchaser, was to make the complete payment of the sale consideration within three months. The clause further mandates forfeiture of the advance amount if the payment obligation is not met within the time period stipulated therein. 43. Further, in the above said judgment itself, the Hon'ble Apex Court has clearly observed by referring to so many judgments that in case of non-compliance of vendor's obligations (of producing certain documents) within three months, no consequences were mentioned; whereas, on the other hand, in case of non-compliance of the purchaser's obligations (of paying the balance sale consideration) within three months, the advance amount would be forfeited. In Para-35 of the said judgment, it is observed as under: \"35. From a perusal of the above extracted portion of Siddamsetty (supra), it is clear that in the said case, the agreement stipulated that both the purchaser as well as the vendor were to fulfil their obligation within three months. But, in case of non-compliance of the vendor's obligations (of producing certain documents) within three months, 41 no consequences were mentioned; whereas, on the other hand, in case of non-compliance of the purchaser's obligations (of paying the balance sale consideration) within three months, the advance amount would be forfeited. This Court while concluding that the purchaser was not ready or willing to perform his part of the contract within the stipulated time period, denied to grant specific performance for the entire contract. However, what is to be seen in the present case, is that the sale agreement dated 14.08.2002 stipulated that the vendor (deceased G. Venugopala Rao) was required to get the land measured and demarcated within three months, following which, the purchaser (Respondent No. 1 herein/Plaintiff) was required to pay the balance sale consideration. So, it can be clearly observed that the performance of the purchaser's obligation to pay the balance sale consideration within three months is dependent upon the fulfilment of the vendor's obligation to get the land measured and demarcated within three months.\" 44. The said observations are similar to the facts of this case. Therefore, it can be deduced that unless the vendor get the subject land measured and demarcated within three months, it would be impossible for the plaintiffs to get a sale deed executed, and as such, the 42 question of paying the balance sale consideration does not arise. In this case also, the defendants have not obtained required documents within three months. It is not necessary that the plaintiffs have to keep the amount ready and if they come forward to get the sale deed executed, by paying the sale consideration and show about financial capacity to pay the said amount, it is sufficient. It has come in the evidence of PW.1 that as per the recitals in the sale agreement, he has kept the amount ready and willing to pay the balance consideration amount. As such, when specific terms of the contract have not been done, the question of time being the essence of contract does not arise. Therefore, the defendants cannot contend that the time was the essence of the contract in view of their failure to get the documents prepared within three months as stipulated. 45. In view of the above, we are of the considered opinion that, the appeal filed by the plaintiffs deserves to be allowed by setting aside the impugned judgment and they are entitled for a decree of their suit granting relief of 43 specific performance of a contract and defendants have to execute the sale deed by receiving the balance consideration amount. 46. It is relevant to refer to the judgment of Hon'ble Apex Court in the case of SARADAMANI KANDAPPAN vs. S.RAJALAKSHMI reported in (2011) 12 SCC 18, wherein it is held that, property prices generally escalate over time due to inflation and market dynamics. In the instant case, 16 years have passed since the agreement was made which means there could be a significant increase in property prices. Courts often recognize that, with the passage of time, the value of the immovable property may have changed substantially. This impacts the fairness of the contract, especially in terms of price and the original intentions of the parties involved. Specific performance is a discretionary remedy. Courts have the power to grant or deny it based on the circumstances of the case, including fairness to both parties. When considering a claim for specific performance, the Court will look at factors like: 44 • The delay in performance by the defendant(s). • Whether the terms of the agreement are still reasonable in light of current circumstances. • The hardship caused to either party if the contract is enforced or otherwise. When someone enters into a sale agreement, they typically have a pressing reason for selling (such as needing funds for medical expenses, education, or buying a new property). In this case, the delay of 16 years has likely prevented the seller from achieving their original goals (such as purchasing another property or making investments). This should be factored into the court's decision. If the seller was relying on the proceeds of the sale for some important purpose, this need should weigh on the court's discretion. The significant rise in land prices, especially in India during the last quarter of the 20th century, along with the fall in the value of money (inflation), presents a situation where the original sale price may no longer reflect the current market value. If the buyer insists on paying the original price, it could 45 result in a loss to the seller, or at the very least, delay the fulfilment of their purpose of sale. The Court may consider this aspect to protect the seller from unfair losses due to inflation or property value escalation. The seller may also be concerned about capital gains tax implications, as the proceeds from the sale must be reinvested within a specific timeframe to avoid paying tax. If the payment is delayed, it may affect the seller's ability to reinvest and save on taxes. This is an important financial consideration that the Court may take into account while exercising its discretion in case of specific performance. 47. The Hon'be Apex Court in the case of P. DAIVASIGAMANI vs. S. SAMBANDAN, reported in AIR 2022 SC 5009 has held in para nos.21, 22 and 23 which read as under: \"21. Having said that, let us examine the facts of this case. As discussed earlier, the respondent- plaintiff had not only averred in the plaint about his issuing notices within the period of six months of the agreement in question, calling upon the appellant-defendant to perform his part of the contract and conclude the sale transaction, also showing his readiness and willingness to perform his part of the contract, but the respondent had also proved the same by stepping into the witness 46 box. Though much reliance was placed by the learned counsel for the appellant on the decisions of this Court in Ritu Saxena v. J.S. Grover [Ritu Saxena v. J.S. Grover, (2019) 9 SCC 132 : (2019) 4 SCC (Civ) 302] , in Abdullakoya Haji v. Rubis Tharayil [Abdullakoya Haji v. Rubis Tharayil, (2019) 17 SCC 216 : (2020) 3 SCC (Civ) 399] , and other cases, to submit that the respondent had failed to establish his financial capacity to pay the balance amount of consideration at the relevant time and had also failed to deposit the said amount in the court at the time of filing of the suit, he was not entitled to the discretionary relief of specific performance as granted by the Court, we do not find any substance in any of the said submissions. As per the ratio of judgment laid down by the three-Judge Bench in Syed Dastagir [Syed Dastagir v. T.R. Gopalakrishna Setty, (1999) 6 SCC 337] , the compliance of “readiness and willingness” has to be in spirit and substance and not in letter and form, while making averments in the plaint. As per Explanation (i) to Section 16(c), he need not tender to the defendant or deposit the amount in the court, but he must aver performance of, or readiness and willingness to perform the contract according to its true construction. 22. Having regard to the facts and circumstances of the case and to the conduct of the parties, we have no hesitation in holding that there was due compliance of Section 16(c) read with its Explanation on the part of the respondent and that it was the appellant who had failed to perform as per the terms of the agreement, though called upon by the respondent to perform. The High Court also had rightly held that the plaintiff had complied with the requirements of Section 16(c) of the said Act by making a specific pleading with regard to his readiness and willingness and also proving the same by reliable evidence. This Court does not find any illegality or infirmity in the impugned judgment [S. Sambandam v. P. Daivasigamani, 2010 SCC OnLine Mad 3459] passed by the High Court. We, therefore confirm the same, so far as granting of 47 decree for specific performance of the agreement in question is concerned. 23. At this juncture, the Court cannot be oblivious to the fact that there has been a steep rise in the price of immovable properties since last few decades. Before the final hearing of the appeal, the parties were sent to the Mediation Centre for exploring the possibility of settlement, however, the mediation remained unsuccessful. Having regard to the fact that the agreement in question was entered into between the parties in October 1989, and considering the steep rise in the prices of land, we are of the opinion that interest of justice would be met if the respondent is directed to pay some more amount. It is also noted that the appellant had enjoyed the possession of the suit land all throughout. Hence in the facts and circumstances of the case, the respondent is directed to deposit a sum of rupees one crore in the trial court towards the sale consideration, over and above the amount that might have been deposited by him, within a period of eight weeks from today. On such deposit being made, the appellant shall execute the sale deed in favour of the respondent and shall also be at liberty to withdraw the said amount deposited by the respondent. Therefore, the offer of the plaintiffs/purchaser in writing, the time and occasion when they offer to pay the balance amount to the defendants/seller is an important factor which would matter when the Court examines the question of discretion i.e., whether or not to grant a decree of specific performance. Having said that, all along plaintiffs have pleaded and proved with expectable 48 evidence about their readiness and willingness to perform part of contract and also brought on record their financial capacity to pay the balance consideration amount. Thus, they have fulfilled as narrated above, the ingredients of Section 16(c) of the Specific Relief Act. In this regard, the Hon'ble Apex Court in P. DAIVASIGAMANI (supra) has held with regard to the rise in price of the land and it was opined that, interest of justice would be met if the purchaser is directed to pay some more amount. It is also noted that, the vendor had enjoyed the possession of suit property all throughout. Hence, in the facts and circumstances of the case, it was directed to the purchaser to deposit more amount than the amount he agreed. As per the sale agreement, the plaintiff agreed to purchase the suit schedule property for a consideration amount of Rs.24,50,000 and on the date of agreement dated 25.08.2008 the first plaintiff paid Rs.5,00,000/- as advance and balance is Rs.19,15,000/-. Because of steep rise in the price, if the plaintiffs are directed to pay Rs.20,00,000/- more in addition to Rs.19,15,000/- and get the sale deed executed in their favour, it would meet the 49 ends of justice. The said amount has to be deposited by the plaintiffs in the trial Court towards the sale consideration over and above amount that have been deposited by them, within six weeks from the date of judgment. On such deposit being made, the defendants shall execute the sale deed in favour of plaintiffs and they are at liberty to withdraw the said amount deposited by the plaintiffs. Accordingly the above raised points are answered in favour of the plaintiffs. Consequently, appeal filed by the appellants i.e., plaintiffs in RFA.No.1498/2011 succeeds and appeal filed by the defendants in RFA.No.1867/2011 is liable to be dismissed. Resultantly, we pass the following: ORDER (i) RFA No.1867/2011 is dismissed. (ii) RFA No.1498/2011 is allowed. (iii) The impugned judgment dated 30.06.2011 passed in O.S.No.2/2009 by the learned Senior Civil Judge, Kundapura is set aside. Suit in O.S.No.2/2009 is decreed. 50 (iv) The plaintiff-appellants are directed to deposit the balance consideration amount of Rs.19,15,000/- along with additional amount of Rs. 20,00,000/- towards rise in price of land in all Rs.39,15,000/- (Rupees thirty nine lakh fifteen thousand only) before the trial Court within six weeks from the date of the judgment excluding the deposit if any already made. (v) The respondent-defendants are hereby directed to execute the sale deed by receiving the balance consideration amount of Rs.19,15,000/- additionally, Rs.20,00,000/- towards rise in price of land, in all Rs.39,15,000/-(Rupees thirty nine lakh fifteen thousand only) within eight weeks from the date of receipt of a copy of this judgment. (vi) If the defendants fail to execute the sale deed within time stipulated, the plaintiffs 51 are at liberty to get the sale deed executed through process of Court. (vii) Under the circumstances, costs made easy. There shall be modified decree in the above terms. Sd/- (S.G.PANDIT) JUDGE Sd/- (RAMACHANDRA D. HUDDAR) JUDGE SK/SMJ "