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SPECIFIC RELIEF ACT – Whether court has power to extend the time for more than 30 days for payment of the balance sale consideration after decree under sec.28(1) of Specific performance Act – yes . Whether sec.148 of civil procedure code applies in this situation – No. Whether the delay of 4 years asking for extention of time for depositing the amount is mainatainable – No.

Hight court of the state of Andhra pradesh loc...

Hight court of the state of Andhra pradesh located at hyderabad. self-photographed. (Photo credit: Wikipedia)

A.P.HIGH COURT

HON’BLE SRI JUSTICE C.V. NAGARJUNA REDDY

C.R.P.No.4825 of 2011

25-1-2012

Ali Jaffar s/o. R.A. Mahmood

V. Venkat Reddy s/o. Narsimha Reddy

Counsel for petitioner : Sri D.V. Srinivasa Rao

Counsel for respondent : –

? CASES REFERRED:
1. AIR 2010 Madras 129
2. (1997) 9 SCC 217
3. AIR 1980 S.C. 512
4. (1994) 2 SCC 642
5. (1997) 3 SCC 1
6. (1996) 5 SCC 589
7. (2003) 10 SCC 390
8. (1995) 5 SCC 115
9. AIR 1999 S.C. 918
10. (1997) 3 SCC 1
11. AIR 1952 Madras 389
12. (2011) 9 SCC 147
ORDER:
The decree-holder in O.S.No.11/2006 filed this Civil Revision Petition
assailing order dated 6-9-2011 in I.A.No.5/2011 in O.S.No.11/2006 on the file of
the learned XI Junior Civil Judge, City Civil Court, Secunderabad (for brevity
“the lower Court“).
The facts, in nutshell, are that the petitioner filed the above mentioned
suit for specific performance of agreement of sale against the respondent.
After the respondent was set exparte, an exparte decree was passed by the lower
court on 28-11-2006. One of the conditions stipulated therein was that the
petitioner shall deposit the balance sale consideration of Rs.16,640/- into the
Court within one month from the date of decree. The petitioner did not deposit
the balance sale consideration as per the said condition. He has, however,
filed I.A.No.5/2011 for condoning the delay of 1417 days and extension of time
for deposit of balance sale consideration.
In support of his application, the petitioner has averred that he has left
to his native village Amaravathi in Chandapur District, Maharashtra and that his
Advocate was not aware of his whereabouts, due to which he could not comply with
the decretal condition regarding deposit of the balance sale consideration. The
petitioner further averred that he was under the impression that the suit was
pending and his Advocate was looking after the suit proceedings and that
recently he came back to Hyderabad and came to know about the passing of the
exparte decree through his counsel.
The respondent resisted the petitioner’s application by filing a counter-
affidavit wherein he has questioned the bonafides of the petitioner in filing
the application with the huge delay of 1417 days and prayed for dismissal of the
application.
The lower Court has dismissed the application of the petitioner mainly on
two grounds, namely, that the petitioner remained quiet for about four years
after passing the exparte decree and that his averments relating to his leaving
for his native place and staying there all those years, were not supported by
any evidence. The lower Court further held that the petitioner failed to give
satisfactory explanation for the inordinate delay of 1417 days in filing the
application and that having obtained the decree for specific performance, it is
the duty of the petitioner to pursue the case with diligence. The second ground
on which the lower Court declined the relief is that as per the amended
provisions of Section 148 of the Code of Civil Procedure, 1908 (for short “the
Code”), the Court cannot enlarge the time beyond 30 days.
At the hearing, Sri D.V. Srinivasa Rao, learned counsel for the
petitioner, submitted that the lower Court has committed a serious
jurisdictional error in dismissing the petitioner’s application for extension of
time for depositing the balance sale consideration. He submitted that the lower
Court is vested with the power to extend time for payment of the balance sale
consideration under Section 28(1) of the Specific Relief Act, 1963 (for short
“the Act”) and that therefore the lower Court has misdirected itself in holding
that it has no power to extend the time beyond 30 days as stipulated under
Section 148 of the Code. In support of his submission that the petitioner is
entitled to extension of time, the learned counsel has placed reliance on the
Judgment of Madras High Court in B.V. Gururaj Vs. M.R. Rathindran1 and also on
various Judgements of the Supreme Court, which found reference in the said
Judgment.
I have carefully considered the submissions of the learned counsel for the
petitioner and perused the record.
As per the condition contained in the decree, the petitioner is liable to
deposit the balance sale consideration within one month. Admittedly, the
petitioner neither complied with the said condition nor filed an application
seeking extension of time before the expiry of the time stipulated by the lower
Court. The petitioner filed an application seeking condonation of delay of 1417
days, which is equivalent to almost four years.
Let me first deal with the conclusion drawn by the lower Court that it has no
power to extend the period beyond 30 days for depositing the balance sale
consideration, in view of Section 148 of the Code, as amended by Act 46/1999
w.e.f. 1-7-2002.
Section 148 of the Code, after its amendment, reads as under :
“Enlargement of time: Where any period is fixed or granted by the Court for the
doing of any act prescribed or allowed by this Code, the Court may, in its
discretion, from time to time, enlarge such period not exceeding thirty days in
total, even though the period originally fixed or granted may have expired.”

Section 28(1) of the Act, which is relevant for the present purpose, is as
follows:
“Where in any suit a decree for specific performance of a contract for the
sale or lease of immovable property has been made and the purchaser or lessee
does not, within the period allowed by the decree or such further period as the
court may allow, pay the purchase money or other sum which the court has ordered
him to pay, the vendor or lessor may apply in the same suit in which the decree
is made, to have the contract rescinded and on such application the court may,
by order, rescind the contract either so far as regards the party in default or
altogether, as the justice of the case may require.”

While dealing with the jurisdiction of the Court to deal with the case after
grant of decree for specific performance, the Supreme Court, in Sardar Mohan
Singh Vs. Mangilal2, at para-4, held as under:
“From the language of sub-section (1) of Section 28, it could be seen that
the court does not lose its jurisdiction after the grant of the decree for
specific performance nor it becomes functus officio. The very fact that Section
28 itself gives power to grant order of rescission of the decree would indicate
that till the sale deed is executed in execution of the decree, the trial court
retains its power and jurisdiction to deal with the decree of specific
performance. It would also be clear that the court has power to enlarge the
time in favour of the judgment-debtor to pay the amount or to perform the
conditions mentioned in the decree for specific performance, in spite of an
application for rescission of the decree having been filed by the judgment-
debtor and rejected. In other words, the court has the discretion to extend
time for compliance of the conditional decree as mentioned in the decree for
specific performance…..”

In K. Kalpana Saraswathi Vs. P.S.S. Somasundaram Chettiar3, the Supreme Court
held that under Section 28 of the Act, it is perfectly open for the trial Court
to extend time for deposit and that in appropriate cases, such extension can be
made even at the appellate stage by the Supreme Court. This view was reiterated
in Ramankutty Gutan Vs. Avara4.
The ratio that could be culled out from the above noted Judgments of the
Apex Court is that the power to extend the time for payment of balance sale
consideration is vested in the Court under Section 28 of the Act. A fortiori,
an application filed for extension of time is traceable to the said provision.
The language of Section 148 of the Code would reveal that it enables the Court
to enlarge the period prescribed or allowed by the Code for doing any act. In
my opinion, in the present case, the obligation of the petitioner to pay the
balance sale consideration arose under the decree. The petitioner is not
required to do any act within the time stipulated by the Code. Therefore, ex
facie, Section 148 of the Code is not attracted to an application filed by a
decree-holder for extension of time for deposit of balance consideration
stipulated in a decree for specific performance of agreement of sale. As
Section 28 of the Act being the substantive provision, any such application for
extension of time for deposit of balance sale consideration is traceable to the
said provision. It, therefore, necessarily follows that the maximum time limit
of 30 days stipulated under Section 148 of the Act does not bar the Court from
extending time beyond the period of 30 days. If the Court is satisfied that the
applicant has made out a case for enlargement of time, it can enlarge the time
in exercise of its power under Section 28 of the Act, regardless of the
provisions of Section 148 of the Code. As such the finding of the lower Court
that it has no power to extend the time beyond 30 days for deposit of balance
sale consideration, in view of Section 148 of the Code, cannot be sustained.
The crucial question which remains to be considered in the present case is
whether the petitioner is entitled for extension of time for depositing the
balance sale consideration?
It is trite that the relief of specific performance is purely a discretionary
relief and the Court is not bound to grant the same merely because there was a
valid agreement of sale. It is an equitable remedy which lies purely in the
discretion of the Court, which of course, has to be exercised according to the
settled principles of law (See: K.S. Vidyanadam Vs. Vairavan5, Lourdu Mari David
Vs. Louis Chinnaya Arogiaswamy6 and Manjunath Anandappa Vs. Tammanasa7).
In N.P. Thirugnanam (Dead) by L.Rs. Vs. Dr. R. Jagan Mohan Rao8 the Supreme
Court held that the Court must take into consideration the conduct of the
plaintiff prior and subsequent to the filing of the suit along with other
attending circumstances.
In V.S. Palanichamy Chettiar Firm Vs. C. Alagappan9, the Supreme Court has dealt
with a case where execution petitions filed by the decree-holder were dismissed
by the trial court. In the revision petitions filed by the decree-holders
before the Madras High Court, the decree-holders filed separate applications
seeking extension of time granted under the decrees by the trial court for
deposit of balance sale consideration. The High Court has remitted the cases to
the executing Court with a direction to treat the said applications as
Interlocutory Applications in the execution proceedings and to dispose them off
in accordance with law. Questioning the said remand order, the judgment-debtor
approached the Supreme Court. The Supreme Court, after a thorough discussion of
the case law on Section 28 of the Act, allowed the appeals filed by the
judgment-debtor by holding that the decree-holders failed to assign any reason
whatsoever in not depositing the balance sale consideration within the
stipulated time under the decrees. The Supreme Court has referred to Article 54
of the Limitation Act, 1963, which prescribed three years period for filing the
suit for specific performance of agreement of sale from the date of agreement or
when the cause of action arose and observed that merely because the suit is
filed within the prescribed period of limitation, it does not absolve the vendee
from showing that he was ready and willing to perform his part of the agreement
of sale and if there was non-performance, the same was on account of any
obstacle created by the vendor. It was further observed that the provisions to
grant specific performance of an agreement are quite stringent and that
equitable considerations come into play. The Supreme Court further held that
the Court has to see all the attendant circumstances including, if the vendee
has conducted himself in a reasonable manner under the contract of sale.
Drawing the same analogy, the Supreme Court has posed a question as to whether a
Court can as a matter of course allow extension of time for making payment of
balance amount of consideration in terms of a decree after five years of its
passing by the trial court and three years of its confirmation by the appellate
Court? While answering this issue in the negative, it was observed :
“….It is not the case of the respondent-decree-holder that on account of
any fault on the part of the vendor-judgment-debtor, the amount could not be
deposited as per the decree. That being the position, if now time is granted,
that would be going beyond the period of limitation prescribed for filing of the
suit for specific performance of the agreement though this provision may not be
strictly applicable. It is nevertheless an important circumstance to be
considered by the Court. That apart, no explanation whatsoever is coming from
the decree-holder-respondents as to why they did not pay the balance amount of
consideration as per the decree except what the High Court itself thought fit to
comment which is certainly not borne out from the record. Equity demands that
discretion be not exercised in favour of the decree-holder-respondents and no
extension of time be granted to them to comply with the decree.”

In the present case, the pleadings of the petitioner, as noted
hereinbefore, would disclose that except making an averment in the affidavit
that he has left for his native village in Maharashtra and that he was not even
aware of the passing of the decree, no effort is made by him to show that he was
diligent in pursuing the case. While the petitioner’s plea in this regard
remained wholly unsubstantiated (the petitioner has not even examined himself as
a witness), even accepting the same as it is, it discloses utter lack of
diligence on his part in pursuing his case further in pursuance of the exparte
decree. Even going by his version, having entrusted his case to his counsel in
the year 2006, the petitioner did not bother to verify the stage of the case for
nearly four years. As observed by the Supreme Court in V.S. Palanichamy
Chettiar Firm (9-supra), while the limitation for filing a suit for specific
performance itself is three years, even in cases where a suit is filed within
the limitation period, still the Court will not grant the decree for specific
performance unless the plaintiff satisfies the Court that he was always ready
and willing to perform his part of the contract. The same considerations were
held to be applicable even while considering an application for extension of
time for deposit of the balance sale consideration. Not even an attempt is made
by the petitioner to state that he was ready and willing to comply with the
condition imposed by the Court below in the exparte decree. No person, who is
interested in seeking specific performance of a contract, is expected to display
such a lethargic and laidback approach as the petitioner has displayed by
delightfully forgetting his case for nearly four years.
In K.S. Vidyanadam Vs. Vairavan10, the Supreme Court held that in cases of
urban properties in India, it is well known that the prices are going up sharply
over the last few decades particularly after 1973. The Supreme Court while
disagreeing with the view of the Madras High Court in S.V. Sankaralinga Nadar
Vs. P.T.S. Ramaswami Nadar11, that mere rise in price is no ground for denying
relief of specific performance, held that the Court cannot be oblivious of the
reality of the constant and continuous rise in the value of urban properties.
This view is reiterated in Citadel Fine Pharmaceuticals Vs. Ramaniyam Real
Estates Pvt.Ltd.12.
The subject matter of the suit is situated in Lalaguda, which is a part of
the city of Hyderabad. The agreement of sale is of the year 1985. The
petitioner filed the suit 21 years after entering into the agreement of sale.
The whole face of the city has undergone a radical change during the last decade
leading to huge increase in land prices. It will be nothing short of windfall
for the petitioner if his exparte decree is allowed to be executed at this
length of time. Conversely, serious prejudice will be caused to the interests
of the respondent as he will be compelled to lose his valuable property for a
pittance. If any relief is granted to the petitioner, that would amount to
placing a premium on his indolence and total lack of diligence and lethargy.
The lower Court is therefore completely justified in dismissing the petitioner’s
application for extension of time for deposit of balance sale consideration, on
the ground of inordinate delay.
The Judgment in B.V. Gururaj (1-supra), on which reliance is placed by the
learned counsel for the petitioner, does not in any manner advance the
petitioner’s case. That was a case where the decree-holder was all through
diligent in filing applications for extension of time. Moreover, the
application filed by the judgment-debtor under Section 28(1) of the Act for
rescission of the contract was dismissed and taking into consideration the facts
and circumstances of the case and the conduct of the parties, the Madras High
Court has extended the time. Hence, the said Judgment is of no help to the
petitioner.
On the premises as above, the Civil Revision Petition is dismissed.

________________________
Justice C.V. Nagarjuna Reddy
Date : 25-1-2012

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