Case Note & Summary
The appellants, Hemant M. Deshmukh, Ashok Varma, and Gyanchand D. Oswal, filed a suit for specific performance of an agreement of sale dated 21/12/1990 against the respondent, Diwakar Dadaji Michkin. The agreement pertained to 6.5 acres of land in Mouza Borkhedi, Nagpur, for a total consideration of Rs. 5,85,000/-. The appellants paid Rs. 50,000/- as earnest money and an additional Rs. 75,000/- later, totaling Rs. 1,25,000/-. The agreement required the sale deed to be executed within six months from 20/6/1991, and the respondent was obligated to assist in obtaining permissions from the Sub Divisional Officer and a No Objection Certificate from the government. The appellants alleged that the respondent failed to assist, leading to the suit. The trial court dismissed the suit, holding that the appellants failed to prove readiness and willingness. On appeal, the High Court examined whether the appellants were ready and willing to perform their part. The court noted that the appellants did not produce any evidence of financial capacity to pay the balance of Rs. 4,60,000/- within the stipulated time. They also did not take any steps to obtain the necessary permissions themselves or show that they had applied for them. The court held that mere payment of earnest money does not establish readiness and willingness. The appeal was dismissed, affirming the trial court's decision.
Headnote
A) Specific Relief Act, 1963 - Section 16(c) - Readiness and Willingness - The appellants failed to prove that they were ready and willing to perform their part of the contract as they did not produce evidence of financial capacity to pay the balance consideration of Rs. 4,60,000/- within the stipulated time. The court held that mere payment of earnest money is insufficient to establish readiness and willingness. (Paras 10-12) B) Contract Act, 1872 - Section 55 - Time as Essence - The agreement stipulated that sale deed was to be executed within six months from 20/6/1991. The appellants did not take any steps to complete the transaction within that period and did not show that time was not of essence. The court held that delay in performance disentitles specific relief. (Paras 13-14) C) Evidence Act, 1872 - Section 101 - Burden of Proof - The appellants bore the burden to prove that they were ready and willing to perform. They failed to discharge this burden as they did not examine any witness to show financial readiness or that they had made necessary applications for permissions. (Paras 15-16)
Issue of Consideration
Whether the appellants were entitled to specific performance of the agreement of sale dated 21/12/1990 and whether they had proved their readiness and willingness to perform their part of the contract.
Final Decision
Appeal dismissed. Judgment and decree of trial court affirmed.
Law Points
- Specific performance
- Readiness and willingness
- Earnest money
- Time is of essence
- Burden of proof
