Case Note & Summary
The case involves a civil revision application filed by Bhagwat Harinkhede (original defendant/judgment-debtor) against Amit Zha and Ajay Nashine (original plaintiffs/decree-holders). The applicant owned agricultural land Gat No.103/2 admeasuring 0.40 hectares. On 04/03/2008, he entered into an agreement to sell the land to the respondents for Rs.2,50,000/-, receiving Rs.41,000/- as earnest money. The balance was to be paid by 31/09/2008. The respondents paid only Rs.20,000/- additionally and failed to pay the balance. The applicant issued a notice on 20/01/2009 cancelling the agreement. The respondents filed a suit for specific performance, which was decreed on 30/04/2011. In execution proceedings, the court granted time to deposit the balance consideration, but the respondents failed to deposit it within the extended time. The applicant filed an application under Section 28 of the Specific Relief Act, 1963, for rescission of the contract, which was rejected by the trial court on 16/01/2018. The High Court considered whether the trial court erred in rejecting the application. The court noted that the decree-holders did not deposit the balance consideration within the time granted and failed to show readiness and willingness. The court held that time was not the essence of the contract for agricultural land, and the decree-holders' failure to deposit the amount warranted rescission. The High Court allowed the revision, set aside the trial court's order, and allowed the application for rescission, directing the decree-holders to return possession if taken and to pay the applicant's costs.
Headnote
A) Specific Relief Act - Rescission of Contract - Section 28 - Execution Proceedings - The applicant/judgment-debtor sought rescission of the sale agreement on the ground that the decree-holders failed to pay the balance consideration within the stipulated time. The trial court rejected the application. The High Court held that the trial court failed to consider that time was not the essence of the contract for agricultural land and that the decree-holders had not shown readiness and willingness. The order was set aside and the application was allowed. (Paras 2-14) B) Specific Relief Act - Readiness and Willingness - Section 16(c) - The decree-holders did not deposit the balance consideration within the time granted by the court. The High Court held that the decree-holders failed to prove their readiness and willingness to perform their part of the contract, which is a condition precedent for specific performance. (Paras 10-14) C) Contract Act - Time as Essence of Contract - Agricultural Land - In agreements for sale of agricultural land, time is not ordinarily considered the essence of the contract unless expressly agreed. The court noted that the agreement did not make time the essence. (Para 12)
Issue of Consideration
Whether the trial court erred in rejecting the application for rescission of contract under Section 28 of the Specific Relief Act, 1963, in execution proceedings, when the decree-holders failed to deposit the balance consideration within the stipulated time.
Final Decision
The High Court allowed the civil revision application, set aside the order dated 16/01/2018 passed by the Joint Civil Judge Junior Division, Gondia, and allowed the application for rescission of contract under Section 28 of the Specific Relief Act, 1963. The court directed the decree-holders to return possession of the suit land to the applicant if taken, and to pay costs of Rs.5,000/- to the applicant.
Law Points
- Section 28 of the Specific Relief Act
- 1963
- Rescission of contract
- Execution proceedings
- Readiness and willingness
- Time is not essence of contract for agricultural land
