SYED SHAFIULLAH Vs. RAFIQ MAHMOOD

JUDGEMENT

(1.) 1. The plaintiff has filed the suit Tor specific performance of the agreement of sale dated 21.3.1979 directing the defendant to execute the sale deed in respect of the ground floor of premises No. 20, Errasappa Maistry Street (Rattan Bazaar), Madras - 3, to deliver possession of the property to the plaintiff and for costs.

(2.) THE averments in the plaint are : (i) THE plaintiff is carrying on business as watch dealers. THE first defendant who is the owner of the building in New No. 12 (Old door No. 20), Errasappa Maistry Street (Rattan Bazaar), Madras - 3, agreed to sell the property for Rs. 1,65,000/- and the terms were finalised between the parties. THE first defendant represented to the plaintiff that by the sale of the entire property within the financial year ending 31.3.1979, he will suffer huge capital gains tax and that, therefore, two separate agreements can be entered into and two separate sale deeds executed, one in respect of the first and the second floor and another in respect of the ground floor. THE first defendant expressly agreed not to sell the property to any one else. Accordingly, on 21.3.1979, two separate agreements were executed. As per the first agreement, the first defendant executed a registered sale deed in respect of the first and the second floor on 29.3.1979 for consideration of Rs. 55,000/-. THE consideration for the sale of the ground floor had been fixed at Rs. 1,10,000/- under the agreement. THE first defendant received an advance of Rs. 5,000/-under each of the two agreements. After the agreement of sale and the execution of the first sale deed in respect of the first and the second floor, the first defendant became scarce as he went away to Pakistan. He had shifted his residence from Madras to Bangalore. (ii) THE first defendant did not obtain the income-tax clearance certificate though a draft sale deed was handed over to him. Time for completion of the sale in respect of the ground floor was fixed as three months, but it was not the essence of the agreement. As the first defendant agreed to execute the sale deed in any event within the next accounting year, the first defendant assured the plaintiff to go over to Madras and complete the sale. After his advocate's notice dated 22.10.1979; the plaintiff suffered some calamities in his family in the middle of October, 1979. THE plaintiff informed the first defendant about his unexpected difficulties and asked the first defendant to complete the sale after some time. Meanwhile, the first defendant sent a letter dated 15.11.1979 purporting to cancel the agreement. But the plaintiff had sent a telegram on 14.11.1979 itself stating that he was willing to complete the sale. THEreafter, the plaintiff and his father met the first defendant personally at Bangalore and the first defendant assured that he would go over to Madras in the first week of December and execute the sale deed. But, the first defendant did not do so. THE unilateral cancellation of the agreement by the first defendant is not valid. THEn, on 3.1.1980, the first defendant informed the plaintiff by his letter dated 6.12.1977 that the ground floor had been already sold to the tenant in occupation. THE entire property including the ground floor should be sold only to the plaintiff under the agreement and also in law and equity. THE plaintiff later came to know that the sale deed executed by the first defendant in favour of the second defendant had taken place on 29.11.1979 for Rs. 1,15,000/-. THE alleged sale in favour of the second defendant is neither valid nor binding on the plaintiff. THE second defendant is not a bona fide puchaser. THE plaintiff has always been ready and willing to pay the balance of Rs. 1,05,000/- and complete the sale and he is entitled to the relief of specific performance of the agreement.

(3.) THE second defendant filed her written statement stating that she is a bona fide purchaser of the ground floor of the building for Rs. 1,15,000/- by virtue of the sale deed executed by the first defendant in her favur on 29.11.1979 without notice of the alleged agreement in favour on the plaintiff. She contended that the agreement dated 21.3.1979 entered into between the plaintiff and the first defendant had been cancelled as the plaintiff himself had committed breach of the contract. In the written statement filed by the second defendant, she has incorporated almost all the allegations mentioned in the written statement of the first defendant and contended that the plaintiff is not entitled to the relief of specific performance.