THANKAMANI W/O VENUGOPALAN Vs. K A MOHAMMAD S/O HASSAINAR AND SECRETARY PANANGAD SERVICE CO-OPERATIVE

JUDGEMENT

(1.) First Defendant in O.S.1082 of 2005 on the file of Munsiff Court, Ernakulam is the Appellant. First Respondent is the Plaintiff and second Respondent, the second Defendant. First Respondent instituted the suit for specific performance of Ext.A1 agreement for sale executed on 30.7.2004 whereunder Appellant admittedly agreed to assign one cent of land within the boundary shown therein, to the first Respondent for a total consideration of Rs. 30,000/-. On the date of execution of the agreement, Rs. 20,000/- was received by the Appellant towards sale consideration as advance and agreed to execute the sale deed on receipt of the balance consideration within a period of six months. First Respondent contending that he has always been ready and willing to perform his part of the agreement, instituted the suit for specific performance of the agreement for sale. He contended that Appellant did not execute the sale deed though he sought execution of the sale deed by paying the balance consideration. Second Respondent was impleaded as Appellant had mortgaged the property in favour of the second Respondent society for a loan of Rs. 1,50,000/- contending that existence of the mortgage was not disclosed. Appellant resisted the suit contending that he had disclosed the existence of the mortgage at the time of entering into the agreement for sale and the original period of six months fixed under Ext.A1 was extended for a further period of five months at the instance of the first Respondent and though Appellant was ready to execute the sale deed, first Respondent did not prepare the draft before the expiry of the extended period of the agreement and hence first Respondent has violated the agreement and he is not entitled to the decree for specific performance of agreement for sale. Second Respondent resisted the suit contending that first Respondent was a member of the society and she availed a loan of Rs. 75000/- and mortgaged the entire properties and she has not paid the amount and as on that date, Rs. 1,20,650/- is due and if at all there is any transaction between the Appellant and Respondent, it is subject to the charge available to the second Respondent.

(2.) Learned Munsiff on the evidence of first Respondent as PW1 and Exts.A1 to A4, dismissed the suit holding that first Respondent is not entitled to the decree for specific performance of the agreement finding that even if a decree for specific performance is granted, it will be subject to the charge for the amount due to the second Respondent, who can proceed against the property. First Respondent challenged it before Sub Court, Ernakulam in A.S.3 of 2010. Learned Sub Judge on re-appreciation of evidence, found that the agreement is for sale of one cent of the property belonging to Appellant and on the evidence found that he is entitled to the decree for specific performance. The appeal was allowed and Appellant was directed to execute a registered sale deed on the first Respondent depositing the balance sale consideration of Rs. 10,000/-. The decree is challenged in the second appeal.

(3.) Learned Counsel appearing for Appellant was heard. The argument of the learned Counsel is that in Ext.A2 reply notice sent by the first Respondent, he has expressed his unwillingness to obtain the sale deed as the property was mortgaged to second Respondent and the mortgage was earlier to the agreement for sale and it was known to the first Respondent. As the period fixed under Ext.A1 expired, first appellate court was not justified in granting the decree for specific performance of the agreement for sale for the reason that first Respondent did not seek an alternative decree for return of the advance amount. The learned Counsel would argue that having found that Section 56 of the Transfer of Property Act is not applicable, first appellate court should not have found that first Respondent is entitled to the benefit as provided under Section 56 of the Transfer of Property Act. Learned Counsel relying on the decision of Apex Court in Academy of Nutrition Improvement V. Union of India, 2011 3 KerLT 43 argued that time is the essence of the agreement and when evidence establish that first Respondent was not prepared to perform his part of the agreement within the period, a decree for specific performance of agreement for sale should not have been granted.