Non-Reportable

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.3336 OF 2019

(Arising out of S.L.P.(C) No.1701 of 2016)

BHAVYANATH REPRESENTED BY
POWER OF ATTORNEY HOLDER … APPELLANT(S)

VERSUS

K.V. BALAN (DEAD) THROUGH LRS. … RESPONDENT(S)

J U D G M E N T

K.M. JOSEPH, J.

1. The appeal by Special Leave is directed against

the judgment passed by the High Court of Kerala at

Ernakulam dated 08.10.2015 in RFA No.869 of 2013. The

appellant is the plaintiff in a suit for specific

performance which has been decreed by the trial Court

but on appeal by the defendant dismissed by the

impugned judgment of the High Court. For the sake of

convenience, the parties would be referred hereinafter

Signature Not Verified

Digitally signed by
ASHA SUNDRIYAL
Date: 2019.09.12
16:32:46 IST
Reason:
as per their status shown in the plaint before the

trial Court.

1
THE AGREEMENT

2. There is no dispute that the plaintiff and the

defendant have indeed entered into an agreement on

25.04.2007. The agreement (marked as A1), inter alia,

provided as follows; The property, which was agreed,

to be sold was mentioned as 75 ¾ cents held by the

defendant as per assignment deed No.1405 of 1975. The

property agreed to be sold included all improvements

thereon including an incomplete RCC house building,

Well, motor shed etc. Payment of Rs.2,00,000/- as

advance was recorded. Towards balance consideration the

plaintiff was to pay the minimum amount of

Rs.3,00,000/- within four months from 25.04.2007. It

is further recited that on such payment, the defendant

will assign land equivalent to Rs.3,00,000/- in favour

of the person nominated by the plaintiff for the

portion agreed by both the parties. The consideration

was fixed at Rs.34,000/- per cent of property to be

found on actual measurement. The time limit was fixed

as "till the 24th day of March, 2008". Time limit was

expressly mentioned as an essential part of the

agreement. The assignment was to be executed either in

2
favour of the plaintiff or any other person nominated

by him in writing. Before the execution of the

assignment deed, the contract further provided that the

plaintiff shall be convinced of the title of the

property and other connected things.

DEVELOPMENTS AFTER THE AGREEMENT

3. It is not in the region of dispute that the

plaintiff paid Rs.3,00,000/- by cheque on 25.08.2007

and it is also endorsed in the agreement. Thereafter,

on 25.01.2008 the defendant sent a lawyers notice to

the plaintiff. Therein it is stated that the defendant

holds 75 ¾ cents as per the assignment deed, already

referred to, which property was agreed to be sold for

Rs.34,000/- in terms of the agreement and the last date

of the agreement was fixed as 24.03.2008. It is further

stated that the plaintiff was to give balance

consideration by deducting the advance within the

stipulated time for which the defendant is ready and

he called upon the plaintiff to get ready for the same

by that time. It is further stated that the plaintiff

had orally offered to the defendant in the presence of

witnesses that he will take assignment of the property

3
even before the stipulated date for which the defendant

is ready.

4. The plaintiff caused a reply notice to be sent to

the aforesaid lawyers notice. The reply notice sent was

dated 18.03.2008. Therein it is relevant to notice

certain statements. After referring to Ext.A1

agreement, it is stated that the lawyers notice was

sent by the defendant without getting the property

measured or producing and convincing the plaintiff

about the original title deed No.1405/1975 as well as

prior documents. It is stated that the plaintiff was

and is continuously ready and willing to perform his

part of the agreement right from the beginning till

then and in future. The statement in the notice, sent

by the defendant, is denied that the plaintiff will

take the assignment before the agreed date and it was

agreed so in the presence of witnesses. It is alleged

that defendant sent the notice with ulterior motive

concealing that property had not been measured and

without producing the original title deed. The

plaintiff pointed out that the defendant consented to

measure the property only three days before that date

4
i.e. on 16.03.2008 (it may be noticed that reply notice

is dated 18.03.2008 and it was sent only later). It was

further stated that the defendant told the plaintiff

that the total extent of property, as per the document,

found on measurement was only 70.950 cents. The case

sought to be set up further is that, according to the

plaintiff, 1 ½ cents of property was not in the

possession or ownership of the defendant. Out of the

70.950 cents of property one cent on the southern

boundary was alleged to belong to one Kochammu and

another ½ cent of property on the northern boundary

belonged to some one else. This information was got by

plaintiff from reliable source. The plaintiff complains

in the reply notice that the defendant was insisting

that he will assign the property only if the

consideration in full for the said 70.950 cents was

paid. Objection was taken to the same by the plaintiff.

Thereafter, it is, inter alia, stated that the

plaintiff is ready and willing to take the assignment

of the entire property available as per the original

document No.1405/1975. The insistence on the part of

the defendant in withholding the original document is

stated to be ill-motivated. The plaintiff thereafter

5
states that he wished to construct residential house

building for his own occupation adjacent to the

property as per agreement which is very close to his

proposed residence. Plaintiff is alleged to have made

solid arrangement for the same. It was specifically,

inter alia, stated that the plaintiff had arranged

balance consideration and he was continuously ready and

willing to take the assignment right from the date of

the agreement i.e. on 24.03.2007 and thereafter in

future as well.

We further notice that on 24.03.2008, which as per

Ext.A1 agreement, was to be the "last date" under the

agreement, the plaintiff and the defendant claimed that

they were present at the office of the Sub Registrar.

According to the plaintiff, the defendant was elusive

and could not be contacted over the phone and he was

unavailable. The plaintiff filed a complaint before the

police on 24.03.2008 in the evening. He also followed

it up with a petition before the Sub Registrar on

25.03.2008. Within three days from 24.03.2008, that is

on 27.03.2008, the present suit came to be instituted,

claiming specific performance. In the plaint, after

referring to the agreement, the plaintiff has alleged

6
that he was always ready and willing to perform his

obligations. The blame was put at the doorstep of the

defendant for breaching the contract. The defendant in

his written statement on the other hand blamed the

plaintiff for breach and it was his case that plaintiff

was not ready and willing and he was not ready with the

funds.

PROCEEDINGS BEFORE THE TRIAL COURT

5. The trial Court struck the following issues; (1)

whether the plaintiff was ready and willing to perform

his part of the contract, (2) whether the defendant

committed breach and (3) whether the plaintiff is

entitled to get a decree for specific performance. The

trial Court, inter alia, found as follows.

"8. It is true that plaintiff has not

produced any document to show that he was
having ready cash covering the balance
consideration, payable by him under Ext.A1,
at the relevant time. Of course, certain
documents are produced to show that presently
he is having some ready cash in the form of
fixed deposits and in the form of share
certificates etc. I do not think that any of
these documents are much relevant in this
case for the reason that in the nature of the
dispute the plaintiff has to prove his
capacity to pay the balance consideration
within the period shown in Ext.A1. Production
of these documents which are admittedly after

7
 the suit may not have much evidentiary
value."

6. The trial Court further holds that it is not the

requirement of law that a vendor in a contract for sale

has to carry the balance consideration with him always

till the expiry of the agreement. It is sufficient that

he has enough source to raise the funds as and when

required. Rejecting the contention of the defendant,

that plaintiff did not have money even when he entered

Ext.A1 agreement, it was noticed that admittedly on the

date of agreement Rs.2,00,000/- was paid and

subsequently Rs.3,00,000/- was paid. The explanation

of plaintiff as to why he did not take the proportionate

extent on payment of Rs.3,00,000/-, as provided in the

agreement, was accepted. It was found that the extent

was not found sufficient on the advise of the engineer

to start the construction. The case of the plaintiff,

in fact, is that the idea to purchase the plaint

schedule property was to start a tuition center by

making a partnership between himself and his family

members. Thereafter, it is found as follows in

paragraph 12:

8
"12. Plaintiff has given clear evidence to
the effect that he had sufficient money with
him for completing his part. As already
stated by him, he did not carry the ready
cash with him through out the period of the
agreement. The total amount o f consideration
comes to Rs.25,67,000/-, even if the extent
is taken as 75 3/4 cents. It is contended
that plaintiff was only a student at the time
of Ext.A1. He is so described in Ext.A1 also.
PW1 says that even at that time he was
employed. True, one cannot expect that from
his employment alone he could have mobilized
the balance consideration. The income tax
returns filed by him show his salary and
prove the above fact. But there is ample
evidence to show that his father was actively
involved in the transaction. PW1 has deposed
that his family members were possessing gold
ornaments worth Rs.25,00,000/- and he was
having cash amount of Rs.8,00,000/- at the
relevant time. The defendant has no case that
the plaintiff was not supported by his
father. In fact, the active involvement of
his father in the transaction is rather
admitted by defendant himself. Plaintiff has
produced several documents to show that his
parents are having sufficient properties and
gold ornaments. Of course, most of them are
after suit documents. But there is an
admission made by DW1 that after Ext.A1, the
plaintiff has purchased an adjacent plot
measuring 10 cents. Considering the totality
of the evidence available, I am inclined to
hold that the plaintiff was having capacity
to raise the balance consideration had the
necessity arisen. Therefore, I am inclined to
accept the evidence of PW1 that he was ready
with the balance consideration or at least he
was capable of raising the balance
consideration as and when required."

9
7. The trial Court thereafter also rendered findings

on the issue as to whether the defendant had committed

breach. The contention of the plaintiff that the

lawyers notice dated 25.01.2008 sent by the defendant

was issued with ulterior motive was accepted. It was

found that under Ext.A1 agreement the property was to

be measured and the actual extent was to be

ascertained. Before sending lawyers notice, the

defendant had not got the property measured. It was for

the defendant to get the property measured. Referring

to the admissions made by the defendant, it was found

that he had not taken any step for measuring the

property. The admission that the defendant was aware

on the date of Ext.A1 agreement that the entire extent

of 75 ¾ cent was not available is referred to. The case

of the defendant that the property was measured by the

plaintiff on 16.05.2007 was found unacceptable. The

case of the plaintiff was that on 16.05.2007 he along

with engineer inspected the site to find out the

possibility of construction in the extent falling

proportionately to the amount of Rs.3,00,000/- was

explored. Defendant was to convince the plaintiff

regarding the title deed and the tax receipt. The

10
plaintiff had got marked Ext.A9 and A10, encumbrance

certificate. They revealed that mortgage was created

by the defendant over the property in the year 1983.

No entry regarding the clearance of the mortgage was

found. The case of the defendant that he had obtained

the release deed was found unacceptable by noting that

the release deed was neither produced nor there is any

evidence to prove that fact. Thus, the defendant had

breached his obligation under the contract. The

plaintiff got the property measured through the village

officials on 16.03.2008 in the presence of the

defendant. The trial Court relied on Ext.A42, the copy

of the counter, filed by the defendant to interlocutory

application, filed by the plaintiff, wherein the

defendant has averred that the plaintiff and his father

got convinced to the actual extent as 70.950 cents by

measuring the property. The trial Court found this to

be a case of the defendant accepting that the

measurement was done on 16.03.2008. The measurement on

16.03.2008 was arranged and paid for by the plaintiff.

It again, according to the trial Court, indicated the

readiness and willingness on the part of the plaintiff

and that the defendant was negligent in performing his

11
part. In Court, the property was got measured by the

Commissioner with the help of Taluk Surveyor. Ext.C2

is the report and Ext.C2(a) is the survey plan prepared

by Commissioner. They show that extent in possession

of the defendant on the strength of the title deed is

71.70 cents. 4.25 cents has been taken out from the

property of the defendant for road. Another extent of

0.375 cents was found to be in the possession of a

third party. These facts are found to be admitted by

defendant as DW1. Measurement in such circumstances was

found absolutely necessary for the completion of the

sale transaction. As regards both, the plaintiff and

defendant, asserting that they were before the Sub

Registrar on 24.03.2008, the trial Court found no

meaning in the same. Both sides were aware that without

measurement it would not have been possible to complete

the transaction. The plaintiff found on measurement

that only lesser extent is available. Appearance before

the Sub Registrar could not be considered as an act

showing the readiness and willingness, it was found

both for the plaintiff and the defendant. Dehors this

act, the trial Court found there were other

circumstances which proved readiness and willingness

12
of the plaintiff. No default on the part of the

plaintiff being found and breach being found on the

part of the defendant and still further finding no

undue hardship even being complained of by the

defendant, the trial Court decreed the suit by

directing specific relief against the defendant.

Defendant appealed.

FINDINGS OF THE HIGH COURT

8. The High Court, inter alia, has entered into the

following findings. It referred to para ‘8’ of the

judgment of the Trial court, which we have extracted.

In paragraphs 23 and 24, the High Court proceeded

to discuss the question whether the defendant was in

breach and this is what the Court proceeded to say:

"23. In so far as the condition requiring

measurement of the amount is concerned,
averments in the plaint itself show that on
16.3.2008, the land was measured. Although it
is case of the respondent that it was he who
got the land measured, the appellant
contended that it was at his instance, the
land was measured. Though evidence is lacking
to conclude this dispute either way, for the
purpose of this case, we do not think it
necessary to resolve this controversy for the
reason that irrespective of who got the land
measured, fact remains that the land was
measured and the parties are in agreement
that on measurement, the extent found was

13
 only 71.750 cents. In other words, this shows
that as a result of teh measurement carried
out on 16.3.2008, one of the conditions for
performance of the agreement was satisfied.

24. In so far as the title of the appellant

is concerned, even the respondent plaintiff
has no case that the appellant did not have
title or that it was defective and the
question of handing over the title deds arise
only at the time of execution of the sale
deed. This, therefore, means that no fault
could have been attributed on the part of the
appellant and therefore, the court could have
granted a decree for specific performance of
the agreement only if the respondent had
satisfied the requirements of section 16(c)
of the Specific Relief Act. In so far as this
aspect of the matter is concerned, the
question is whether the respondent has proved
his readiness and willingness to perform the
agreement."

9. After referring to various decisions of this Court

and of the High Court, the High Court proceeded to find

that a finding of breach by the vendor in performing

his obligations would not be sufficient for a Court to

decree specific performance. The breach by the

defendant, in other words, would not absolve the

plaintiff to allege and prove his readiness and

willingness to perform his obligations under the

contract. "Readiness" relates to financial capacity to

pay consideration whereas "willingness relates to the

14
state of mind. Following are the findings which we may

refer to:

"25. While readiness indicates the fiscal

capacity of the respondent to perform the
agreement, willingness indicates his state of
mind. In so far as readiness is concerned,
the further question that is required to be
proved is whether readiness has been proved
on the evidence available. We have already
referred to paragraph 8 of the judgment and
the oral evidence of PW1 which, to our mind,
do not help the respondent plaintiff to prove
his case of readiness or his capacity to
perform the agreement. Turning to the
documents that are relied on, those documents
include Exts.A22 and A23 valuation
certificates of the gold allegedly possessed
by the respondent's mother and wife, which
were marked through PW4. Ext.A24 series and
A25 marked through PW8 are the certificates
issued about the properties allegedly owned
by them. These are documents which were
obtained after 24.3.2008 and are regarding
the assets owned by the father, mother and
wife of the respondent plaintiff. The owners
of these assets have not tendered any
evidence whether the actually possessed these
properties at the time when the agreement was
to be performed and even if they had
possessed these assets, whether they were
willing to part with it in order to enable
the respondent plaintiff to generate funds
out of it towards the sale consideration
payable under Ext.A1. There is also no
averment in the plaint to that effect.

26. In so far Exts.A11 to A16 are concerned,

these again are fixed deposit receipts issued
in the year 2012, which also cannot help the
respondent plaintiff to prove his capacity as
on 24.3.2008 or any time before that. Among
the other documents which were relied on by
the learned counsel for the respondent to

15
 contend that the readiness was proved by him,
Exts.A17 and A20 show that his father had
sold certain shares on 3.11.2010. Similarly,
Ext.A18 shows that the respondent had sold
his shares on 31.8.2010. Ext.A19 is yet
another document which show that on
26.12.2011 his mother had sold certain
shares. Exts.A26 and 27 are certificates
issued by the Canara Bank and Union Bank
again in 2013 when the trial was pending,
which show that his father had certain funds
available with him. As in the case of
Exts.A11 to A16, A22, A23, A24 and A25, all
these documents would not show that funds
were available with either of the respondent
or his parents on 24.3.2008 or any time prior
thereto. Therefore, these documents also will
not help the respondent to contend that his
readiness and willingness were proved by him
to substantiate his prayer for specific
performance of Ext.A1 agreement."

10. On the above reasoning, High Court allowed the

appeal and decree of the trial Court was set aside.

11. We have heard Shri K.V. Viswanathan learned senior

counsel for the appellant/plaintiff besides Shri P.N.

Ravindran learned senior counsel for the

respondent/defendant.

12. Learned senior counsel for the plaintiff points

out that High Court committed error in interfering with

the judgment of the trial Court. The principles

16
relating to compliance with Section 16(c) which

enshrines the concept of readiness and willingness on

the part of the plaintiff has not been properly

appreciated. He submitted that plaintiff had sufficient

capacity which is what mattered. The law cannot be

disputed that in a suit for specific performance, the

plaintiff need not have the amount in cash. What is

crucial is whether he has the financial capacity to

perform his obligations. He drew our attention to the

fact that the plaintiff along with members of his

family, which consisted of his father, mother and his

wife, had enough resources. An amount of Rs.5,00,000/-

was already paid. Even the gold ornaments having regard

to their value (valued at Rs.24,00,000/-) besides about

Rs.8,00,000/- in cash held by the plaintiff himself

would suffice. The Court need not even go into the

aspect relating to landed properties and other assets

available. As regards the finding of the High Court

about the certificates relating to landed property,

being later in point of time, it is pointed out that

lands were very much with the members of the family as

on the date of the agreement and the date when the sale

was to be executed. The fact that the certificates were

17
of a later date did not take away the availability of

these assets. He pointed out that, in fact, the dispute

actually centered around the extent of property and the

financial capacity was not in dispute as such.

13. Per contra, Mr. P.N. Ravindran, learned senior

counsel drew our attention in paragraph 8 of the trial

Court which we have already referred to. He further

submitted that as regards the gold ornaments, the

plaintiff has not chosen to examine the members of his

family and without their testimony showing their

willingness to make available their valuables, apart

from the availability of the assets, it could not be

said that the High Court fell into error.

14. Before we advert to the facts it is appropriate to

discuss a few decisions of this Court. In Man Kaur

(Dead) by Lrs. v. Hartar Singh Sangha - (2010) 10 SCC

512, this Court dealt with the contention of the

purchaser in that case that the vendor had committed

the breach and there is no need for the plaintiff to

prove his readiness and willingness. This is what the

Court held in paragraph 40:

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"40. This contention has no merit. There are
two distinct issues. The first issue is the
breach by the defendant - vendor which gives
a cause of action to the plaintiff to file a
suit for specific performance. The second
issue relates to the personal bar to
enforcement of a specific performance by
persons enumerated in section 16 of the Act.
A person who fails to aver and prove that he
has performed or has always been ready and
willing to perform the essential terms of the
contract which are to be performed by him
(other than the terms the performance of
which has been prevented or waived by the
defendant) is barred from claiming specific
performance. Therefore, even assuming that
the defendant had committed breach, if the
plaintiff fails to aver in the plaint or
prove that he was always ready and willing to
perform the essential terms of contract which
are required to be performed by him (other
than the terms the performance of which has
been prevented or waived by the plaintiff),
there is a bar to specific performance in his
favour. Therefore, the assumption of the
respondent that readiness and willingness on
the part of plaintiff is something which need
not be proved, if the plaintiff is able to
establish that defendant refused to execute
the sale deed and thereby committed breach,
is not correct. Let us give an example. Take
a case where there is a contract for sale for
a consideration of Rs.10 lakhs and earnest
money of Rs.1 lakh was paid and the vendor
wrongly refuses to execute the sale deed
unless the purchaser is ready to pay Rs.15
lakhs. In such a case there is a clear breach
by defendant. But in that case, if plaintiff
did not have the balance Rs.9 lakhs (and the
money required for stamp duty and
registration) or the capacity to arrange and
pay such money, when the contract had to
beperformed, the plaintiff will not be
entitled to specific performance, even if he
proves breach by defendant, as he was not

19
 "ready and willing" to perform his
obligations.”
(Emphasis supplied)

15. Taking up the issue relating to measurement of the

property, let us examine the matter in some detail. In

Ext.A1 agreement the defendant had agreed to sell 75 ¾

cents acquired under document No.1405/1975. The price

was fixed as Rs.34,000/- per cent. The extent was no

doubt to be found on actual measurement. The trial

Court found that though it is not stipulated as to who

will carry measurement, but the defendant being in

possession he was, to undertake the measurement. The

defendant, when he was examined as DW1, has inter alia

stated as follows; For the purpose of determination of

sale consideration property had to be measured. He

further states that after one week of the date of

execution of the agreement Gopi brought a person and

measured the property. When he saw the measuring

activity, he went to the property and asked for a copy

of the measurement details, but was not given. We

proceed on the basis that the reference to Gopinath,

is none other than the father of the plaintiff. He

admits that these facts are not stated in the written

20
statement. He states that he did not know about the

measurement of the property on 16.03.2008. There was

no opportunity to get the plaint schedule property

measured before the same was to be assigned. He

specifically states that he has not convinced them the

actual measurement of the plaint schedule property. He

further states that no measurement of the plaint

schedule property was done before the expiry of the

agreement period. He further states that he has not got

measured the extent of property after execution of the

agreement. He states that he does not remember about

the statement in Ext.A42 about the extent of the

property being convinced of by the plaintiff and his

father to be 70.950 cents. He specifically states that

it is not right to say that the plaint schedule property

has been got measured on 16.03.2008. He states that he

was not present at that time. We would think that the

High Court was in error in holding that on measurement

being carried on 16.03.2008, one of the conditions for

the performance of agreement was satisfied if it is

meant to find that the defendant had carried out the

obligations under the contract. It is noticed from

paragraph 23 of the impugned judgment that contrary to

21
his deposition, which we have adverted to as DW1, it

was contended on behalf of the defendant that the

measurement on 16.03.2008 was at his instance. It is

noticed that under Ext.A1 agreement the extent was

stated to be 75 ¾ cents, under a particular assignment

deed. The consideration was undoubtedly fixed with

regard to the actual extent at the rate of Rs.34,000/-

per cent. It is clear that the measurement was

essential for executing the conveyance and the

performance of further mutual obligations. When the

lawyers notice was caused to be sent on 24.01.2008 by

the defendant, he adverts to 75 ¾ cents. There is no

reference of any measurement having been done on

16.05.2007. We are inclined to find that it was the

plaintiff who took the initiative and the property

indeed was measured on 16.03.2008. We are further

inclined to agree with the trial Court that the

plaintiff, it is who financed the measurement by making

payment as he claimed. Testimony of the witness

accepted by the trial Court, which has had opportunity

to watch the demeanour of the witness is not to be

likely shaken by the appellate court.

22
16. Still further the next finding by the High Court
is contained in paragraph 24 of its judgment. The Court

proceeds to hold that even the plaintiff has no case

that the defendant did not have title or that it was

defective and the question of handing over title deed

arises only on the execution of the sale deed and

therefore no fault could be attributed to the

defendant.

17. In this regard there are two aspects which we would

think has not been considered by the High Court. We

have adverted to the statements in the reply notice

sent dated 18.03.2008 by the plaintiff. The measurement

took place on 16.03.2008. On measurement it appears to

have been found that the extent available with the

defendant was 70.950 cents. However, plaintiff found

that one cent out of the 70.950 cents was not with the

defendant and instead was with one Kochammu and half

of cent was with somebody else in the northern side.

However, when this was brought to the notice of

defendant, according to plaintiff, he wanted payment

on the basis that he had the whole of 70.950 cents.

Therefore, the said question related to the title of

23
the defendant, a question relating to the exact extent

available for being conveyed. Secondly and far more

importantly, admittedly there was a mortgage over the

plaint schedule property created in 1983 by the

defendant. Encumbrance certificates produced by the

plaintiff has been relied upon by the trial Court to

find that the mortgage had not been cleared. The

defendant in his evidence as DW1 sets up the case that

the mortgage was cleared and release deed was available

with him. It is at his home. On the one hand, the

encumbrance certificates did disclose the mortgage and

they did not reveal the clearing of the mortgage. The

defendant on the other hand, though setting up the case

that the debt was paid of and mortgage was got released

but did not choose to produce the evidence which was

in his possession.

18. The High Court has overlooked this aspect and came
to the conclusion that there was no dispute relating

to the title. Under Ext.A1 agreement, it was incumbent

upon the defendant to convince the plaintiff about the

title of the property and other connected things. No

doubt, the plaintiff had made a demand for the original

24
title deeds relating to the property, as he wanted to

use them for the purpose of taking a loan in connection

with his proposed construction. This we do not think

he was entitled under the contract and if the defendant

refused the title deeds we would not be in a position

to blame him. We are, therefore, of the view that the

High Court has fallen into an error in reversing the

finding that the defendant was in breach of his

obligations.

19. We have noticed the law to be that it does not

suffice for the plaintiff in a suit for specific

performance to establish that the defendant was in

breach to seek a decree for specific relief. The

plaintiff must further establish, if it is contested

that he was ready and willing from the date of the

contract to perform his obligations.

20. In a contract, a contract usually embodies mutual

obligations. The order of performance of obligations

by the parties to the contract would have an impact on

the aspect relating to readiness and willingness

undoubtedly. In fact, readiness and willingness on the

part of plaintiff makes its appearance right from the

25
time of the reply notice sent by the plaintiff and

continued in his pleadings. We are, however, concerned

in this case only with the aspect relating whether he

has proved despite what he might have established

against the defendant that he was ready to perform his

obligations. To begin with, the plaintiff has filed the

suit on 27.03.2008. It must be remembered that under

Ext.A1 agreement, the last date for executing the sale

deed was 24.03.2008. This means on the third day of the

date fixed under the contract on the allegation that

the defendant resiled from the promise to execute the

sale deed, the plaintiff has knocked at the doors of

the Court seeking specific relief.

21. The second thing which no doubt appears in favour

of the plaintiff is that on the date of the agreement,

which was 25.04.2007, admittedly an amount of

Rs.2,00,000/- was paid as advance within four months

of the agreement, again, indisputably a further sum of

Rs.3,00,000/- came to be paid by the plaintiff and

accepted by the defendant. The further question that

arises, however, is whether the High Court was right

in holding that the plaintiff was not in a position to

26
perform the financial obligations under the contract.

At this juncture, let us examine the state of the

evidence adduced by the parties.

22. The plaintiff has examined himself as PW1 and

further examined eight other witnesses. He has also

marked Ext.A1 to A42. The defendant has examined

himself as DW1. There are other Court exhibits which

are related to financial position of the plaintiff.

23. Not unnaturally, we must first look to what the

plaintiff has deposed before the Court. The plaintiff

says, inter alia, as follows in his cross-examination;

During the period of Ext.A1 agreement I was a student.

He added that he had a part time teaching job and

consultancy service. The plaintiff claimed that he was

a teacher in an academy. He produced income tax

returns. He was asked the following questions. At the

time of the filing of the suit, you have not produced

any document showing availability of money required for

taking assignment of the property. Whether there is any

specific reason for the same (Question)? There is no

specific reason for the same (Answer). Is there any

27
reason for not stating in the plaint in what way the

amount required was arranged (Question)? No special

reasons (Answer). How much amount was arranged by you

on 24.03.2008 to take assignment of plaint schedule

property (Question)? There was gold jewelry worth

Rs.24,00,000/- held by myself and my family members.

Besides, about Rs.8,00,000/- was arranged in cash also

(Answer). He states that he has understood that the

main dispute in this case is that he was not having the

capacity to raise the consideration as per Ext.A1

agreement. Another question which was put to the

plaintiff is as follows. Apart from producing certain

documents on 02.02.2013 showing availability of funds,

you have not produced any other document before that

to show funds (Question)? No (Answer).

24. We must notice that Shri K.V. Viswanathan, learned

senior counsel would submit that High Court has

appreciated aforesaid question and answer erroneously.

He pointed out that actually when the plaintiff

answered 'no', it should be understood the meaning was

that he was denying the suggestion that the plaintiff

had not produced any document to show funds. He would

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submit that had the answer been yes, it could be

inferred that there was no document. The plaintiff

continues and states six documents being Ext.A11 to A16

are of the year 2012. The number of shares are not

mentioned in Ext.A17. The plaintiff has further

apparently, with reference to income tax returns Ext.35

and 36, stated that income has been shown as

Rs.1,18,000/- and Rs.1,32,000/- for the assessment

years 2007-08 and 2008-09 respectively. No doubt there

is no mention about his investments and shares in the

income tax returns. Plaintiff claimed that during the

year 2004-05 his income was about Rs.30,000/- and

during 2005 the same was around Rs.60,000/-. He joined

an academy as a teacher in the year 2006. He resigned

from the same during the year 2011. During the period

2006-08 he purchased and sold 22 cents of land.

Plaintiff does not remember the price at which the

property was purchased. He denied the suggestion that

he was not having the money to purchase the property

admeasuring 70.950 cents or as reduced by 1 ½ cents.

He was having required amount then and now and he was

ready and willing to take the property, he deposed.

29
25. PW2 is a Managing Director of financial company.
He has produced and marked Ext.A19 certificate relating

to shares held by the mother of the plaintiff.

26. PW3 is a Depository Participant of a broker. He

was examined to prove the shares held by his mother.

He states that he came to depose on being asked to do

so by Gopinathan (father of the plaintiff).

27. PW4 is a Government Gold Valuer of Income Tax

department and he has proved Ext.A22 valuation report

issued to the mother of the plaintiff after examining

her gold ornaments. He has also proved Ext.A23

valuation report, issued to the wife of the plaintiff,

after examining her gold ornaments. In cross-

examination he would also state that he has not

received summons from the court, but was asked by

Gopinathan (father of the plaintiff). He states that

he has previous acquaintance with Gopinathan. He came

for valuation and thus he knew him. He states further

in cross-examination that the mother and wife of the

plaintiff came to him for valuation along with

Gopinathan. He further states that they neither

30
produced nor he demanded the bills or receipts relating

to the gold ornaments he valued that day. He further

states that they did not produce any document showing

ownership of the gold ornaments mentioned in Ext.A22

and A23 jewelery produced for valuation. In

reexamination, he points out that Gopinathan, who came

on the date of the gold valuation was sitting in the

Court.

28. PW5 is the Branch Manager of the Syndicate Bank.

He has marked Ext.A41. In cross-examination he states

that the loans were availed on 14.07.2012 and

22.03.2012. He further states that Syndicate Bank

advances loan at the rate of Rs.2100/- per gram of

gold. The two loans were given for agricultural

purposes.

29. PW6 is the Manager of Union Bank and he approved

Ext.A27. Again he is produced to prove gold loan which

is issued for agricultural purposes. The loan was

issued on 12.01.2013. The loan was given at the rate

of Rs.2000/- per gram of gold.

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30. PW7 is the Chairman and Managing Director of
Financial Chits Company. He proved Ext.A17, 18, 20 and

21. In cross-examination he states he knows Gopinathan.

He states that he (Gopinathan) is practising as an

accountant and auditor in the next building. He states

that the shares held by him as per Ext.A20 was

transferred from his name on 03.11.2010. At present

Gopinathan and his son, the plaintiff, did not hold any

shares in the companies. The value of one share he

states is Rs.100/-. The plaintiff is not having any

share as per Ext.A17. He is holding only 250 shares.

31. PW8 has proved Ext.A24 and A25 reports. He claims

to be the valuer of property. He has valued as on 2008.

He denied the allegation that the present fair value

is less than the value shown in the report. When he was

asked what is the fair value of the properties, as

determined by the government, the answer was that he

has to verify. On similar lines was the answer in

respect of another piece of land. In answer to the

question whether he was ever verified the fair value

of the survey, the answer is in negative. Gopinathan

was known to him since last 12 years and he described

32
him as an auditor. He says that he is not acquainted

to his son (apparently the plaintiff).

32. PW-9 is the Manager of Canara Bank and he proved

Ext.A26 certificate. Apparently, it related to a gold

loan.

33. Coming to the evidence of defendant, we notice the

following inter alia; He was aware that as on the date

of agreement the extent of plaint schedule property did

not have an extent of 75 ¾ cents. He says that he knew

right from the date of the agreement that the plaintiff

is not having money to purchase the plaint schedule

property. When he was asked what was the reason for

sending the lawyers notice on 25.01.2008, his answer

was as follows: It was heard that plaintiff is trying

to resell the plaint schedule property to third parties

as he was not having money to purchase the same, hence,

the said notice was sent. He further states that he did

not know anything about the schedule of witnesses

submitted in the Court by him including the names of

witnesses as (1) Rajesh and (2) Muhammed. He says that

he does not remember the fact that in the counter to

the injunction petition, he had stated that the

33
plaintiff told Rajesh to find prospective buyers for

reselling the plaint schedule property on piecemeal

basis. He further states that anyhow Rajesh and

Muhammed were not examined as witnesses before the

Court. He denies that plaintiff was ready with the

money to purchase the plaint schedule property.

34. The plaintiff on the date of the suit in the year

2007 was 21 years. The agreement would show that the

witnesses to the agreement are one Manoharan, who is

none other than the son of the defendant and the other

witness is Gopinathan, the father of the plaintiff. The

trial Court has entered a finding that Gopinathan was

actively involved in the contract. We have eluded to

the fact that Gopinathan was a witness to the agreement

to safely conclude that the father of the plaintiff was

in the know of things and he was involved in the

transaction. We have referred to Gopinathan, figuring

in the deposition to arrive at the conclusion that the

plaintiff, though the actual party to the agreement,

the moving force and one who intended to support the

plaintiff was his father. The assets which are relied

on by the plaintiff to establish his financial capacity

34
would appear to belong to the close relatives of the

plaintiff, namely, his father, his mother and his wife.

We must recall that in his deposition PW1, when he was

asked as to on what basis he would claim that he had

the financial capacity on 24.03.2008, his answer was

that he had gold ornaments which were worth about

Rs.24,00,000/- and he had about Rs.8,00,000/- in cash

having regard to the payment of Rs.5,00,000/- by way

of advance and further payment to be made, after making

the advance, if Rs.24,00,000/- worth of gold being in

the possession of the plaintiff’s family members

besides Rs.8,00,000/- was there, certainly that would

suffice to establish the case of the plaintiff about

his financial capacity and readiness to perform the

contract. The law is certainly not that the purchaser

in a suit for specific relief must prove that he was

having cash with him from the date of the agreement

till the relevant date. What is important is that he

had the capacity to allow the deal to go through. If

gold was available, as claimed, we would think that on

a pragmatic view of the matter, it may be idle to

contend that it could not be converted into cash either

by immediate sale or by raising a loan.

35
35. We must, however, deal with certain other

contentions before we come to a conclusion in this

regard. The defendant has undoubtedly a case that the

gold ornaments though claimed to be that of the mother

and the wife of the plaintiff, without examining them

as witnesses and without their deposition showing that

they had those gold ornaments in their possession and

that they were willing to employ them for the purpose

of generating funds for the plaintiff, the Court cannot

conclude the matter in favour of the plaintiff. We

would think that it may be true that in a case of this

nature and in view of the context, it may have been

more appropriate that the relatives were examined.

Their non-examination, however, may not fatal to the

plaintiff. It must be realized that the relatives

involved are none other than the mother and the wife

of the plaintiff. Though subsequent their inclination

can be inferred from their going to the valuer PW4. In

such circumstances, we would think, it may be carrying

matters a little too far to decline specific relief,

particularly which was granted by the trial Court in

its discretion to contend that the mother and the wife

36
have not come forward to express their willingness to

make available ornaments for the purpose of the

plaintiff. In fact, no suggestion is seen put to the

plaintiff about the same.

36. The further question may, however, arise as on the

relevant date whether the gold ornaments having the

value of Rs.24,00,000/- was available with the mother

and the wife of the plaintiff. We have noticed the

deposition of PW4. He has stated that neither the bills

nor receipts relating to the gold ornaments were

produced. No documents relating to the ownership of the

gold ornaments were also produced. Could it be said,

therefore, that the gold ornaments never belonged to

the mother and the wife of the plaintiff and the

valuation report is therefore robbed of any value that

might otherwise be attached to it.

37. It is here we may notice that the family of the

plaintiff was possessed of considerable assets even

otherwise in terms of landed property. We further

notice that the plaintiff has proceeded to purchase

another 10 cents during the period when the contract

37
was in existence (relied upon by the trial Court to

establish the readiness and willingness in terms of

capacity apparently).

38. A1 contract is dated 25.04.2007. Plaintiff was, no

doubt, 21 years of age. His father Gopinathan was a

witness to A1. Knowing these facts, defendant entered

into the agreement, and what is more, received Rs.2

lakhs on the date of the agreement. Further, a sum of

Rs.3 lakhs was received under the agreement on

25.08.2007. The property is measured on 16.03.2008. On

the third day from 24.03.2008, which was the last day

for the execution of the sale deed, i.e., on

27.03.2008, the suit came to be filed. After the

advance paid by the plaintiff is deducted, the balance

amount including the stamp duty and expenses would not

exceed Rs.24 lakhs. There was the testimony of the

plaintiff as to how he intended to pay the

consideration on 24.03.2008. There was evidence of

plaintiff having gold ornaments with him and family

members worth about Rs.24 lakhs and cash of about Rs.8

lakhs. It also appeared that one of the family members

of the appellant had lands in her name. Even the

38
appellant purchased other land during the period of

contract. In regard to the statement by the plaintiff

that gold ornaments worth about Rs.24 lakhs were held

by him and family members and there was cash of about

Rs. 8 lakhs, the plaintiff is not cross-examined as

such. At any rate, there is no serious dispute raised

when he was cross-examined in this regard. There is no

question raised about the family members not making

available the gold ornaments or that it was not

available with them. The non-availability of bills

relating to the gold jewellery to prove ownership as

such may not be in the facts of this case fatal to the

plaintiff.

39. Having regard to the totality of the facts present,

we are of the view that the High Court erred in

interfering with the decree passed by the Trial Court.

We notice that the appellant has deposited the sum of

Rs.19,37,8000/- (balance amount) with the Government

Treasury immediately after judgment dated 10.06.2013.

While we are inclined to direct specific relief in

favour of the appellant, we are of the view that we

should also direct that interest at the rate of 6 per

39
cent on Rs.19,37,8000/- from 27.03.2008 (date of suit)

till date of deposit (in Government Treasury) should

be directed to be paid over and above the balance amount

to the respondents in exercise of our power under

Article 142 of the Constitution of India. Hence, we

allow the appeal, set aside the judgment of the high

Court and restore the decree passed by the Trial Court,

subject to the following modifications.

40. We further direct that appellant shall pay a sum

calculated at 6 per cent per annum on Rs.19,37,800/-

from 27.03.2008 till the date of deposit in Government

Treasury in 2013 also, apart with the balance to be

paid. The respondents can withdraw the balance payment

(i.e., Rs.19,37,800/-) as also amount calculated at 6

per cent on Rs.19,37,800/- as aforesaid. The balance,

if any, in the Government Treasury, can be withdrawn

by the appellant. If the amount in the Government

Treasury does not attract interest, the appellant shall

deposit the amount of interest as calculated within 10

weeks from today which can be withdrawn by the

respondents. It is only after payment of interest as

aforesaid, that the conveyance deed need be executed.

40
41. The parties shall bear their own costs.

.......................J.
(ASHOK BHUSHAN)

.......................J.
(K.M. JOSEPH)
New Delhi,
September 12, 2019.

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