Whether purchaser of immovable property is bound to make enquiry whether seller is minor or suffering from legal disability?

 Once it is proved that the plaintiff was a minor at the time of execution of the sale deed, the sale deed cannot be held to be a legal and valid document and is liable to be set aside to the extent of share of the plaintiff. As per law, there cannot be any estoppel against the statute. Once the law provides that a minor cannot enter into a valid contract, the contract, if any, entered into by the minor cannot be held to be legal and valid, using the doctrine of estoppel. The defendant should have been vigilant enough to ascertain that vendor Vikas had attained majority and was not suffering from any legal disability, before entering into the transaction in question with him and his brother.

15. Learned District Judge has referred to the judgment Lakhwinder Singh vs. Miss Paramjit Kaur, MANU/PH/0817/2003 : 2004 (1) LJR 371 (P&H), by this Court wherein it was observed that a transferee must make all reasonable and diligent enquiries regarding the capacity of the transferor and the necessity to alienate the estate of the minor and on satisfying those requirement, he is to enter into and have the sale deed from the guardian or manager of the estate of the minor. It was further observed that under the Guardian and Wards Act, the estate of the minor cannot be alienated unless a specific permission in that behalf is obtained from the District Court. Learned District Judge has observed that no such permission was ever obtained in the instant case by brother of the minor to alienate the share of the minor in the property in dispute. Therefore, sale of the share of the minor respondent, made by his brother vide impugned sale deed Exhibit P-3 is void ab initio and not binding upon the rights of the respondent and sale deed is liable to be set aside to the extent of share of minor plaintiff Vikas.

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH

RSA No. 2752 of 2013 (O&M)

Decided On: 31.07.2019

Pearls Dream Palaces Construction (P) Ltd. Vs.  Vikas

Hon'ble Judges/Coram:

Harminder Singh Madaan, J.

Citation: AIR 2019 P &H 164

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When it is not necessary to examine executant of sale deed to prove execution of sale deed?

 Coming to the question whether execution of sale deed in favour of plaintiff has
been proved, the High Court has held that the sale deed has not been proved for want of
examination of Buchamma. The High Court has ignored the pleadings of the parties and
the evidence on the question of execution of sale deed which establishes that sale deed

had been executed by Buchamma in favour of the plaintiff. In the written statement
filed on behalf of the defendants, the sale deed was denied for want of knowledge. A
perusal of same indicates that the authority of Buchamma to execute the sale deed in
favour of the plaintiff was put into question. Defendant no. 3 Sarojana in her deposition
in court did not deny the fact that sale deed was executed by Buchamma in favour of the
plaintiff. She has stated that she was not aware whether Buchamma has executed anysale deed in favour of the plaintiff. She only asserted that she was the adopted daughter
of Yashoda.
15. It is settled law that denial for want of knowledge is no denial at all. The
execution of the sale deed was not specifically denied in the written statement. Once the
execution of the sale deed was not disputed it was not necessary to examine Buchamma
to prove it. The provisions contained in Order 8 Rule 5 require pleadings to be
answered specifically in written statement. This Court in Jahuri Sah & Ors. v. Dwarika
Prasad Jhunjhunwala AIR 1967 SC 109 has laid down that if a defendant has no
knowledge of a fact pleaded by the plaintiff is not tantamount to a denial of existence offact, not even an implied denial. Same decision has been followed by Madhya Pradesh
High Court in Dhanbai D/o Late Shri Cowash v. State of M.P. & Ors. 1978 MPLJ 717.
The High Court of Madhya Pradesh in Samrathmal & Anr. v. Union of India, Ministry of
Railway & Ors. AIR 1959 MP 305 relying on P.L.N.K.L. Chettyar Firm v. Ko Lu Doke

AIR 1934 Rang 278 and Lakhmi Chand v. Ram Lal AIR 1931 All. 423, had also opined
that if the defendant did not know of a fact, denial of the knowledge of a particular fact

is not a denial of the fact and has not even the effect of putting the fact in issue.

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 4816 OF 2016

Muddasani Venkata Narsaiah V Muddasani Sarojana

Citation:(2016) 12 SCC 288

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How to ascertain limitation in suit for specific performance of contract when no date for execution of sale deed is fixed?

Article 54 of the Limitation Act which prescribes the period of limitation for filing suit for specific performance reads as under:

|54. |For specific        |Three    |The date of fixed for the        |
|    |performance of a    |years    |performance, or, if no such date |
|    |contract.           |         |is fixed, when the plaintiff has |
|    |                    |         |notice that performance is       |
|    |                    |         |refused.                         |

49. Mere reading of Article 54 of the Limitation Act would show that if the date is fixed for performance of the agreement, then non-compliance of the agreement on the date would give a cause of action to file suit for specific performance within three years from the date so fixed. However, when no such date is fixed, limitation of three years to file a suit for specific performance would begin when the plaintiff has noticed that the defendant has refused the performance of the agreement.

50. The case at hand admittedly does not fall in the first category of Article 54 of the Limitation Act because as observed supra, no date was fixed in the agreement for its performance. The case would thus be governed by the second category viz., when plaintiff has a notice that performance is refused.

Supreme Court of India

Rathnavathi & Anr vs Kavita Ganashamdas on 29 October, 2014

Bench: Fakkir Mohamed Kalifulla, Abhay Manohar Sapre

Citation; (2015)5SCC223, 

Civil Appeal :9949/2014                                                                           

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How to ascertain that time was essence of contract in suit for specific performance of contract?

 Another accept is to be considered in the present case is that where time is the essence of the contract, failure to stick to the time disentitles the defaulter to seek specific performance. However, the question whether time is the essence of the contract has to be decided not only with reference to the terms of the contract but also with reference to the conduct of the parties and the facts and circumstances of the case. Thus, where time is the essence of the contract is an inference from proved facts and is therefore a question of law. (Sriram Cotton Pressing Factory v. Narayanasamy, MANU/TN/0270/1965 : AIR 1965 Mad 352). Where a contract relates to sale of an immovable property, it will normally be presumed that time is not the essence of the contract. As held by the Supreme Court in the case of Gomathinayagam Pillai v. Palanisamy Nadar, MANU/SC/0067/1966 : AIR 1967 SC 868, where the fixation of period within which the contract has to be performed does not make a stipulation as to time as the essence of the contract.

whether time is essence of the contract, the said section reads as under:

"55. When a party to a contract promises to do a certain thing at or before a specified time, or certain things at or before specified times, and fails to do any such thing at or before the specified time, the contract, or so much of it as has not been performed, becomes voidable at the option of the promisee, if the intention of the parties was that time should be of essence of the contract.
If it was not the intention of the parties that time should be of the essence of the contract, the contract does not become voidable by the failure to do such thing at or before the specified time; but the promisee is entitled to compensation from the promisor for any loss occasioned to him by such failure.
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 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.

71. From perusal of above section, the position which emerges out is that the above section deals with the effect of failure to perform the promise at a fixed time, in contracts in which time is essential. The question whether time is the essence of the contract, with reference to the performance of a contract, what generally may arise for consideration either with reference to the contract as a whole or with reference to a particular term or condition of the contract which is breached. In a contract relating to sale of immovable property if time is specified for payment of the sale price but not in regard to the execution of the sale-deed, time will become the essence only with reference to payment of sale price but not in regard to execution of the sale-deed. Normally in regard to contracts relating to sale of immovable properties, time is not considered to be the essence of the contract unless such an intention can be gathered either from the express terms of the contract or impliedly from the intention of the parties as expressed by the terms of the contract.

72. The legal position on the point in issue is clear from the decision of a Constitution Bench of Hon'ble the Apex Court in the case of Chand Rani v. Kamal Rani, MANU/SC/0285/1993 : (1993) 1 SCC 519, held as under:

"It is a well-accepted principle that in the case of sale of immovable property, time is never regarded as the essence of the contract. In fact, there is a presumption against time being the essence of the contract. This principle is not in any way different from that obtainable in England. Under the law of equity which governs the rights of the parties in the case of specific performance of contract to sell real estate, law looks not at the letter but at the substance of the agreement. It has to be ascertained whether under the terms of the contract the parties named a specific time within which completion was to take place, really and in substance it was intended that it should be completed within a reasonable time. An intention to make time the essence of the contract must be expressed in unequivocal language."

73. Hon'ble the Apex Court in the case of N. Srinivasa v. Kuttukaran Machine Tools Ltd., MANU/SC/0265/2009 : (2009) 5 SCC 182, held that in the contract relating to immovable property, time cannot be the essence of the contract", the appellant put forth the contention that in all contracts relating to sale of immovable property, time stipulated for performance, even if expressed to be the essence, has to be read as not being the essence of the contract and consequently the contract does not become voidable by the failure to perform before the specified time. A careful reading of the said decision would show that the sentence relied on (occurring in para 31) apparently was not the statement of legal position, but a conclusion on facts regarding the contract that was being considered by the Court in that case, with reference to its terms. In fact the legal position is differently stated in para 27 of the said decision:

"In a contract for sale of immovable property, normally it is presumed that time is not the essence of the contract. Even if there is an express stipulation to that effect, the said presumption can be rebutted. It is well settled that to find out whether time was the essence of the contract, it is better to refer to the terms and conditions of the contract itself."

74. Taking into consideration the earlier judgment on the point in issue, Hon'ble the Apex Court in the case of Saradamani Kandappan v. S. Rajalakshmi and others, MANU/SC/0717/2011 : (2011) SCC 18, in para 26 held as under:

"Relying upon the earlier decisions of this Court in Gomathinayagam Pillai v. Palaniswami Nadar, MANU/SC/0067/1966 : AIR 1967 SC 868 and Govind Prasad Chaturvedi v. Hari Dutt Shastri, MANU/SC/0010/1977 : (1977) 2 SCC 539, held that fixation of the period within which the contract has to be performed does not make the stipulation as to time the essence of the contract. Where the contract relates to sale of immovable property, it will normally be presumed that the time is not the essence of the contract. Thereafter, this Court held that even if time is not the essence of the contract, the Court may infer that it is to be performed in a reasonable time: (i) from the express terms of the contract; (ii) from the nature of the property; and (iii) from the surrounding circumstances as, for example, the object of making the contract. The intention to treat time as the essence of the contract may however be evidenced by circumstances which are sufficiently strong to displace the normal presumption that time is not the essence in contract for sale of land."

75. Thus, from the above said facts, that time is presumed not to be of essence of the contract relating to immovable property, but it is of essence in contracts of re-conveyance or renewal of lease. The onus to plead and prove that time was the essence of the contract was on the person alleging it, thus giving an opportunity to the other side to adduce rebuttal evidence that time was not of essence. That when the plaintiff pleads that time was not of essence and the defendant does not deny it by evidence, the Court is bound to accept the plea of the plaintiff. In cases where notice is given making time of the essence, it is duty of the Court to examine the real intention of the party giving such notice by looking at the facts and circumstances of each case. That a vendor has no right to make time of the essence, unless he is ready and willing to proceed to completion and secondly, when the vendor purports to make time of the essence, the purchaser must be guilty of such gross default as to entitle the vendor to rescind the contract.

IN THE HIGH COURT OF ALLAHABAD (LUCKNOW BENCH)

First Appeal No. 39 of 1978

Decided On: 16.04.2014

Syed M.M. Rizvi  Vs. Subhash Singh

Hon'ble Judges/Coram:Anil Kumar, J.

Equivalent Citation: 2014(5)ADJ111, 2014 6 AWC5751All, 2014 124 RD679

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