Thursday, 28 April 2016

When oral evidence shall not prevail over terms and conditions mentioned in contract?

The learned counsel for the appellant submitted that
the Courts below have not considered circumstances that there
is only oral evidence of plaintiff and there is nothing in rebuttal
in respect of the oral evidence. He submitted that when
evidence is given that plaintiff had approached Smt. Mathurabai
and Mathurabai had given assurance to execute the sale deed,
this unrebutted evidence ought to have been considered by the
Courts below and it ought to have been held that the remedy
was still in existence. This submission is not at all acceptable.
When the terms and conditions of the contract were embodied in
the document and there was condition like fixing of time of
performance, not much importance can be given to the oral
evidence of plaintiff though it is unrebutted.
IN THE HIGH COURT AT BOMBAY
APPELLATE SIDE, BENCH AT AURANGABAD
SECOND APPEAL NO. 183 OF 2015
WITH
CIVIL APPLICATION NO. 4815 OF 2015
Dr. Miss Kunda d/o. Khemraj Choudhary ....Appellant.
Versus
Smt. Mathurabai w/o. Mahadu Jadhav
(Deceased) and others ....Respondents.

CORAM : T.V. NALAWADE, J.
DATED : 1st September, 2015.
Citation;2016(2) ALLMR203,2016(3) MHLJ602

1) The appeal is filed against judgment and decree of
Regular Civil Appeal No. 135/2012 which was pending in the
Court of Ad-hoc District Judge, Vaijapur, District Aurangabad. The
suit filed by the present appellant bearing Special Civil Suit No.
66/2004 which was pending in the Court of Civil Judge, Senior
Division, Aurangabad and which was filed for relief of specific
performance of contract, was decided in favour of appellant by
the trial Court and this decision is set aside by the first appellate
Court. Both the sides are heard.

2) The learned counsel for appellant submitted that
substantial questions of law need to be formulated on the basis
of grounds mentioned in the appeal memo, which are as
follows :-
(i) Non consideration of the documentary as well as
oral evidence on record and relying on the evidence
which is not admissible as per the Evidence Act is
considered.
(ii) Non framing of the points for determination by
the lower appellate Court as per Order 41 Rule 31 of
C.P.C.
(iii) Whether the facts and circumstances of the case
can it be said that, lower appellate court is justified in
setting aside well reasoned judgment passed by the
lower court, without recording any reasons, meaning
thereby can it be said that, the same is judgment in the
eyes of law.
(iv) Whether the lower appellate court is justified in
setting aside well reasoned judgment delivered by the
lower court in the fact and circumstances when oral as
well as documentary evidence adduced by the
Appellant was remained unchallenged.

(v) Whether the lower appellate court is justified in
recording the finding for point No. 1 and 3 in
affirmative in view of the ratio laid down in Smt.
Chandrani's case reported in AIR 1993 SC 1743 and the
oral evidence adduced by the Appellant gone
unchallenged and the respondents have not adduced
any oral evidence.
(vi) Whether the lower appellate court is justified in
recording the finding that the time was the essence of
contract and the suit is barred by limitation ignoring
the oral evidence which remain unchallenged and by
virtue of Mutation Entry No. 193 area of the suit land
has been changed, can it be said that, suit for specific
performance in respect of the immovable property time
can be the essence of the contract.
(vii) Whether the lower appellate court is justified in
reversing the well reasoned judgment on sympathetic
ground, ignoring the ratio laid down in Chandrani's
case.
(vii) Whether the lower appellate court is justified in
recording the finding for point No. 2 in negative when
evidence of the Appellant remained unchallenged and
furthermore in view of the ratio laid down by the

Hon'ble Apex Court, the party concerned should not
carry money with him evey now and then and when it
has been stated on oath the Appellant was/is ready and
willing to perform her part of contract.
3) It is the case of appellant/plaintiff that deceased
Smt. Mathurabai Jadhav was owner of land Gat No. 15,
admeasuring 2 Acres 35 Guntas, situated at village Naigaon,
Tahsil Gangapur and she had agreed to sell this property to the
plaintiff for consideration of Rs. 2,35,000/- under written
agreement dated 16.11.1988. It is the case of plaintiff that she
has paid Rs. 50,000/- as a part of consideration to Smt.
Mathurabai and the remaining amount was to be paid within four
months from the date of agreement and then the sale deed was
to be executed. It is contended that there were some technical
hurdles for execution of the sale deed and so, the sale deed was
not executed within the prescribed time. It is the case of plaintiff
that there were changes made in the revenue record regarding
area of the suit property and as the changes were not finalized,
the sale deed was not executed. It is the case of plaintiff that
after such changes, she requested the promisor Smt. Mathurabai
to execute the sale deed and Mathurabai said that, she wanted
to take consent of her daughters, defendant Nos. 2 and 3 and so,

further time was taken by Mathurabai. It is the case of plaintiff
that she was always ready and willing to pay the remaining
amount of consideration, but the defendants did not show
eagerness to fulfill their promise by executing the sale deed. It is
contended that ultimately, plaintiff sent a notice by Registered
Post A. D. on 19.7.2003 through her advocate, asking the
defendants to complete the sale deed, but the notice was not
accepted by the defendants. She had prayed for relief of specific
performance of the contract as contained in aforesaid written
document and in alternate, she had prayed for equitable reliefs.
4) Defendant Nos. 2 and 3 filed their written statement
and denied everything. They denied that their mother had
executed agreement in favour of plaintiff and she had accepted
part of consideration under the agreement. The defendants
contended that as the suit was filed after 15 years and 2 months
from the date of so called contract, the suit was hopelessly time
barred. They have shown ignorance about the proceeding, if any,
started for correcting area of the suit land in the revenue record.
It is their case that they have become absolute owners of the
land after the death of their mother. They have contended that
plaintiff had never intimated that there was such agreement
between the plaintiff and their deceased mother. They have

denied that they had refused to accept the notice sent by the
advocate of the plaintiff. They had requested for rejection of the
plaint under Order 7 Rule 11 of Civil Procedure Code.
5) It appears that the defendants were not allowed to
cross examine the plaintiff and defendants did not give oral
evidence . The trial Court held that the suit is within limitation.
On the basis of oral evidence, the trial Court decreed the suit.
6) The first appellate Court considered the following
points :-
(i) Whether the time is essence of contract ?
(ii) Whether the plaintiff had proved that she was
ready and willing to perform her part of
contract ? and
(iii) Whether the suit was time barred ?
All the three points are answered against the plaintiff by the first
appellate Court.
7) The appellate Court has considered the circumstance
that during the lifetime, Smt. Mathurabai had given the suit
property to the daughters, defendant Nos. 2 and 3 and

accordingly, the mutation was sanctioned on 11.12.2000. The
appellate Court has also observed that this fact was within the
knowledge of plaintiff and that can be inferred in view of the
facts and circumstances of the case. The appellate Court has
held that this act of Mathurabai could have been treated as the
act of refusal, even if the other circumstances are ignored and as
the suit is not filed within three years from the date of the
sanction of the mutation, it is held that the suit is barred by
limitation. It is also observed that for about 15 years the
remaining consideration was not offered and so, the plaintiff
failed to prove that she was ready and willing to perform her
part of contract. In view of the contents of the agreement, the
first appellate Court has held that the time was essence of
contract. The appellate Court has discussed the provisions of
section 16 of the Specific Relief Act and has referred some
reported cases.
8) Copy of the agreement was produced and the
execution of this document was proved in the trial Court. In the
pleadings itself, it is admitted by the plaintiff that she was to pay
the remaining amount of consideration, which was around Rs.
1.85 lakh, within four months from the date of agreement. There
is the mention in the agreement that the sale deed was to be

executed by the promisor Smt. Mathurabi within four months
from the date of agreement. There was specific mention that the
time of four months was to be counted from 5.11.1988, which
was the date of agreement. The daughters of Smt. Mathrabai
had not signed on this document which is titled as 'Isar Pavti'. No
possession of land was given. The document does not show that
there was any hurdle in execution and registration of sale deed.
Thus, from the agreement, it can be said that there was no
necessity of getting permission of any authority for execution of
the sale deed and registration could not have been refused by
the Sub-Registrar. In view of these circumstances and specific
pleading in the plaint that the remaining consideration was to be
paid within four moths from 5.11.1988, it was necessary for the
plaintiff to specifically plead about particulars that within this
period she had offered to give remaining consideration and she
had shown readiness and willingness to perform her part of
contract. These circumstances have created probability that
plaintiff was not having money to pay the remaining
consideration on the date of agreement. From the pleadings, it
can be said that it is very vague and the contention that some
changes were made in the area of revenue record during that
time is also not substantiated. The plaintiff has contended that
first time in writing, she sent notice to Smt. Mathurabai through

advocate on 19.7.2003. In para 6 of the pleading, there is
mention that plaintiff knew that the land was transferred in the
names of defendant Nos. 2 and 3 under mutation dated
11.12.2000. No explanation is given as to why she did not take
steps even after getting the knowledge of this mutation. In any
case, this mutation was effected after completion of three years
from the date of agreement. These circumstances need to be
considered for ascertaining both, the cause of action for the suit
and readiness and willingness of plaintiff to perform her part of
contract.
9) The provision of Article 54 of the Limitation Act gives
period of limitation for such suit and it runs as follows :-
Description of
suit
Period of limitation Time from which period
begins to run
For specific
performance of
a contract
Three years The date fixed for the
performance, or if no such
date is fixed, when the
plaintiff has notice that
performance is refused.
There are two parts, the circumstances, on the basis of which
the cause of action can arise in this Article and they are :-
(i) when the date of performance is fixed and the
promisor has not performed his part of contract within
prescribed period, and

(ii) when the date, time is not fixed, but the plaintiff
can gather that the performance is refused by the
promissor.
Thus, the period of limitation of three years mentioned in Article
54 will start to run from the date of cause of action which can be
ascertained on the basis of aforesaid two circumstances.
10) For ascertaining the date of cause of action, the
provisions of Specific Relief Act and Contract Act also need to be
considered. The provision of section 9 of Specific Relief Act 1963
runs as under :-
"9. Defence respecting suits for relief
based on contract.- Except as otherwise
provided herein, where any relief is claimed under
this Chapter in respect of a contract, the person
against whom the relief is claimed may plead by
way of defence any ground which is available to
him under any law relating to contracts"
In view of this provision, some provisions of Contract Act in the
present case need to be referred and they are the provisions of
sections 46 and 55. They run as under :-
"46. Time for performance of promise,
where no application is to be made and no
time is specified.-Where, by the contract, a
promisor is to perform his promise without

application by the promisee, and no time for
performance is specified, the engagement must be
performed within a reasonable time.
Explanation.- The question " what is a reasonable
time " is in each particular case, a question of
fact."
"55. Effect of failure to perform at fixed
time, in contract in which time is essential.-
When a party to a contract promises to do a
certain thing at or before a specified time, or
certain things at or before specified time, and fails
to do any such thing at or before the specified
time, the contract, or so much of it as has not
been performed, becomes voidable at the option
of the promisee, if the intention of the parties was
that time should be of the essence of the contract.
Effect of such failure when time is not
essential.- If it was not the intention of the
parties that time should be of the essence of the
contract, the contract does not become voidable
by the failure to do such thing at or before the
specified time; but the promisee is entitled to
compensation from the promisor for any loss
occasioned to him by such failure.
Effect of acceptance of performance at
time other than that agreed upon.- If, in case
of a contract voidable on account of the promisor's
failure to perform his promise at the time agreed,
the promisee accepts performance of such
promise at any time other than that agreed, the

promisee cannot claim compensation for any loss
occasioned by the non-performance of the promise
at the time agreed, unless at the time of such
acceptance, he gives notice to the promisor of his
intention to do so."
11) The provision of section 46 shows that when no time
is fixed for performance of contract, it needs to be performed
within reasonable time. The explanation to that section shows
that "what is reasonable time" depends on facts and
circumstances of each particular case and it is a question of fact.
When in the agreement, no other condition is mentioned like in
the present case, it becomes easy to ascertain the reasonable
time within which the promisor was expected to execute the sale
deed and the same can be said in respect of the promise of the
plaintiff to pay the remaining consideration. Thus, even if the
time limit of four months mentioned in the agreement is ignored,
it is not difficult to ascertain the date of cause of action in the
present case.
12) The provision of section 55 of the Contract Act shows
that if the time is fixed and the promisor fails to perform his part
of contract within the specified time, the contract becomes
voidable at the option of promisee. In such a case, it is open to
the promisee to accept the performance even after fixed time as

contract becomes only voidable. Thus, the contract had become
voidable at the instance of promisee, if it is treated that time
was essence of contract. If the time was not essence of contract,
in that case, promisee becomes entitled to get compensation
from the promisor for loss caused to him due to failure of
promisor of performance of his part of the contract. Thus, in both
the cases the promisee can wait for the performance of the
promise by the promisor, but when the time was essence of
contract, the promisee cannot claim compensation for loss
occasioned for non-performance of promise at the time agreed
unless he had given notice to promisor of his intention to
recover, to get compensation also. These provisions show that
they are with regard to breach of terms and conditions of the
contract and they have no reference to the law of limitation.
13) From the aforesaid two provisions of Contract Act
and the law of Limitation already quoted, in the present case, it
can be said that even after it is presumed that time was not
essence of contract, the plaintiff ought to have filed suit within
reasonable time from the date of agreement. It ought to have
presumed by plaintiff that the promisor had refused to perform
her part of the contract. However, the pleadings and the
contents of the agreement shows that the time of four months

was fixed and no explanation is given by the plaintiff as to why
there was such mention in the agreement. In view of these
circumstances, for the present matter, it can be said that the
time started to run after expiry of four months and the four
months need to be counted from the date of agreement.
14) The learned counsel for the appellant submitted that
the Courts below have not considered circumstances that there
is only oral evidence of plaintiff and there is nothing in rebuttal
in respect of the oral evidence. He submitted that when
evidence is given that plaintiff had approached Smt. Mathurabai
and Mathurabai had given assurance to execute the sale deed,
this unrebutted evidence ought to have been considered by the
Courts below and it ought to have been held that the remedy
was still in existence. This submission is not at all acceptable.
When the terms and conditions of the contract were embodied in
the document and there was condition like fixing of time of
performance, not much importance can be given to the oral
evidence of plaintiff though it is unrebutted.
15) The so called legal notice of plaintiff was issued on
23.7.2003 and so, it can be said that the notice was also issued
after the expiry of the prescribed period of limitation. It needs to

be mentioned here that the first appellate Court has counted the
period from the date of sanction of mutation, though it could
have been counted after expiry of four months period fixed in
the agreement. Thus, even if the best possible case available to
the plaintiff is considered, it can be said that plaintiff filed suit in
the year 2004, when the mutation was effected in favour of
defendant Nos. 2 and 3 on 11.2.2000.
16) It appears that defendant No. 1 Smt. Mathurabai, the
promisor, was not available to file written statement as she died
and written statement was filed by her two daughters. This
circumstance needs to be considered while considering the
contention of the learned counsel for the plaintiff that there is no
evidence in rebuttal. As Mathurabi was dead, the document
executed by her in the year 1988 is the version of Mathurabai
available at present in view of provision of section 32 (3) of the
Evidence Act. Fixing of the period was against her interest in
view of provisions of Contract Act already quoted.
17) For considering the right of plaintiff to get specific
performance of aforesaid contract, it was necessary for plaintiff
to satisfy the conditions given in section 16 (c) of the Specific
Relief Act. The provision of section 10 (a) (b) and explanation (1)

to this section also needs to be kept in mind as this provision
was argued in support of the case of the plaintiff. These
provisions run as under :-
"10. Cases in which specific performance of
contract enforceable.- Except as otherwise
provided in this Chapter, the specific performance
of any contract may, i the discretion of the Court,
be enforced -
(a) when there exists no standard for
ascertaining the actual damage caused by the
non-performance of the act agreed to be done; or
(b) when the act agreed to be done is
such that compensation in money for its nonperformance
would not afford adequate relief
Explanation.- Unless and until the contrary is
proved, the Court shall presume-
(i) that the breach of a contract to
transfer immovable property cannot be adequately
relieved by compensation in money; and
(ii) ..............."
The relevant provision of section 16 (c) of the Specific Relief Act
is as under :-
"16. Personal bars to relief.- Specific
performance of a contract cannot be enforced in
favour of a person-
(a) ............
(b) ...........
(c) who fails to aver and prove that he has

performed or has always been ready and willing to
perform the essential term of the contract which
are to be performed by him, other than terms the
performance of which has been prevented or
waived by the defendant."
18) The aforesaid provisions of Specific Relief Act show
that there is discretionary power to the Court to grant relief of
specific performance of contract and in ordinary course, the
Court need to grant such relief when the contract involves
transfer of immovable property as breach of such contract
cannot adequately relieved by compensation in money. For
getting this relief, the conditions laid down in section 16 (c) need
to be specified by the plaintiff. The provision of section 10 can be
used by the Court only after the plaintiff satisfies the conditions
given in section 16 (c) of Specific Relief Act, 1963 and the
opportunity for satisfying the conditions laid down in section 16
(c) will be available to the plaintiff only if he is able to prove that
the suit was filed within limitation. It is needless to observe that
law of limitation is prescribed for such cases only in Limitation
Act and unless and until the suit is filed within limitation, within
the period as mentioned in Article 54 of Limitation Act, there will
not be any opportunity for using the provision of section 16 (c)
or section 10 of the Specific Relief Act. It is already observed
that the provisions of sections 46 and 55 of the Contract Act can

be used for limited purpose, for ascertaining the cause of action.
These provisions can be used for giving effect to the provisions
of Limitation Act. The provisions of law already discussed and
the facts and circumstances of the present case show that the
cause of action arose after four months of the date of the
agreement and so, the suit filed in the year 2004 was hopelessly
time barred. The material available is considered by the first
appellate Court and the oral evidence of plaintiff cannot make
much difference in that regard.
19) On the point of readiness and willingness, there is no
specific pleading in the plaint which is necessary in view of the
wording of provision of section 16 (c) of the Specific Relief Act.
No date, year are mentioned about the so called steps taken by
the plaintiff. The suit was filed after about 15 years of the date of
contract when the price of the landed property must have
increased many times. Such conduct of the plaintiff needs to be
considered while using discretion. Thus, on one hand, she failed
to prove that she was ready and willing to perform her part of
contract and on that other hand, the aforesaid conduct of the
plaintiff needs to be considered against the plaintiff at the time
of using discretion given to the Court under section 10 of the
Specific Relief Act.

20) The findings of the appellate Court on aforesaid
points are the findings on facts. So, this Court holds that there is
no point made out for which substantial questions of law can be
formulated.
21) The learned counsel for the plaintiff placed reliance
on some reported cases like AIR 2008 SUPREME COURT 1205
[Balasaheb Dayandeo Naik (Dead) Through L.Rs. and Ors.
Vs. Appasaheb Dattatraya Pawar, AIR 2012 SUPREME
COURT 2035 [Narinderjit Singh Vs. North Estate
Promoters Limited], AIR 2000 SUPREME COURT 434
[Velamuri Venkata Sivaprasad (Dead) by LRs. Vs. Kothuri
Venkateswarlu (dead) by LRs. and Ors.], AIR 1993
SUPREME COURT 1742 (1) [Smt. Chand Rani (dead) by
LRs. Vs. Smt. Kamal Rani (dead) by L.Rs.] and AIR 1999
SUPREME COURT 1441 [Vidhyadhar Vs. Mankikrao and
Anr.]. These cases are on the points like interpreting the
stipulations of the agreement to ascertain as to whether the
time was essence of contract for section 55 of the Contract Act,
the circumstance of escalation of price cannot be ground to deny
specific performance of agreement to sell in view of section 20
of Specific Relief Act if there is no pleading of hardship and if it is

not proved that it will be inequitable to order of specific
performance of agreement, the scope of second appeal and the
point that if inadmissible evidence is considered by the Courts
below, substantial question of law can arise on that point and
the point that adverse inference which can be drawn against the
party who does not enter the witness box. There cannot be
dispute over these propositions made in the reported cases. The
facts and circumstances of each and every case are always
different. Sufficient discussion is made on the points which are
involved in the present matter and which are dealt with by the
District Court, first appellate Court. There is no scope of
interference in the second appeal and there is no material
available for formulation of substantial questions of laws.
22) In the result, the appeal stands dismissed. Civil
Application is also disposed of.
23) The learned counsel for plaintiff requested for some
relief to prevent the defendants from alienating the property,
but this relief is refused in view of the facts and circumstances of
the case already discussed.
[ T.V. NALAWADE, J. ]

Print Page

No comments:

Post a Comment