HIRA MISTAN Vs. DELETED

JUDGEMENT

(1.) The appellant, who is original plaintiff, has preferred this appeal challenging the dismissal of its suit no. 677 of 1977, for specific performance of the contract for sale of immovable and movable properties, by the learned Single Judge of this Court.

(2.) To state in brief, it is the case of the plaintiff/appellant that in February, 1976, the defendant nos. 1 to 10 represented by the defendant no. 1 and one Mr. Nicholson represented to Suresh Agrawal, a partner of the plaintiff firm, through a broker Kirti Tijoriwala, about their intention to sell the movable and immovable properties as set out in paragraph 1 of the plaint. After the plaintiff showed its willingness to discuss and negotiate the matter, negotiations in the form of exchange of draft agreements and correspondence took place for a long time. The defendants agreed to sell immovable properties for consideration of rs. 6,81,000/- and the movable properties for consideration of Rs. 30,000/ -. As per the agreements, the plaintiff was to deposit earnest amount of Rs. 68,000/- towards the price of immovable properties and Rs. 3,000/- towards the price of movable properties with the attorneys of the defendants. Defendants had to hand over possession of the entire ground floor of the main building, the whole of the factory premises, stable and shed and all other open spaces to the plaintiff. An agreement for sale was to be prepared and executed. According to the plaintiff, agreement was not to contain express provisions as regards the vacant possession and a separate letter signed by each of the defendants was to be handed over to the plaintiff in respect of possession on the earnest amount being deposited with the defendants' attorneys. As per the oral agreement, solicitors for the defendants submitted the drafts of the agreements to the solicitors of the plaintiff alongwith the letter dated 3rd March, 1976 with a request to return the same duly approved. Thereafter some correspondence took place about the contents of the agreements. On 6th May, 1976, a meeting was convened, which was attended by the defendant no. l and Mr. Nicholson representing the defendants alongwith their attorneys and the plaintiff was represented by its partner Suresh Agrawal alongwith attorneys and the broker was also present. Draft agreements were finalised It was agreed that the draft agreements would be engrossed by the attorneys for the plaintiff and would be executed by the plaintiff and the same would be forwarded next day alongwith the cheques for the amount of Rs. 68,000/- and Rs. 3,000/-being earnest money to the attorneys for the defendants. Accordingly, the plaintiff deposited an amount of Rs. 72,000/- with their attorneys on 7th May, 1976 and the attorneys for the plaintiff kept the agreements, cheques and the letter dated 7th May, 1976 ready to be sent to the attorneys of the defendants awaiting confirmation from the defendants. As no confirmation was received from the defendants about execution of agreements, on enquiry by the plaintiff. The defendant no. 1 and Mr. Nicholson informed on 10th May, 1976 that only seven out of 10 co-owners had executed the letter regarding possession of the property. However, they assured that the signatures of the remaining 3 defendants would also be taken and the stamped engrossment duly signed by the plaintiffs and the two cheques for the earnest money were forwarded to the attorneys of the defendants for getting the agreements signed by the defendants and for forwarding the original to the plaintiff. After delivery of the cheques, the defendant no. 1 and Mr. Nicholson produced the letter dated 7th May, 1976 signed by only 7 defendants but they orally stated that all the defendants will hand over vacant possession of the entire ground floor of the building, stable and factory premises. The original letter was taken back, however, its photocopy was handed over to the plaintiff. Thereafter, the attorneys for the defendants returned the cheques to the attorneys of the plaintiff with a letter dated 10th May, 1976 contending that there were some material alterations in the stamped engrossment of the approved drafts. After re-engrossment of certain pages, the agreements were again forwarded to the attorneys of the defendants alongwith the two cheques on 17th May, 1976 but those cheques and the engrossments without signatures were returned to the attorneys of the plaintiff on 20th May, 1976. Finally on 21st september, 1976, two agreements for sale of immovable and movable properties came to be executed by the defendants. On the same day, attorneys for the defendants forwarded both the agreements to the attorneys for the plaintiff and requested them to forward fresh cheques of Rs. 3,000/- and Rs. 68,000/- being the earnest money under the said two agreements. It was mentioned in that letter that the said two agreements were to be held in Escrow until the plaintiff's cheques were encashed. The said letter was received by the attorneys for the plaintiff on 23rd September, 1976. Accordingly, two cheques for the earnest money were prepared and were about to be forwarded but before the cheques could be despatched the defendant no. l and Mr. Nicholson informed the plaintiff that the defendant nos. 4, 7 and 9 had not yet signed the letter confirmed the agreement to hand over possession and they also requested the plaintiff to withhold sending of the cheques. In these circumstances, plaintiff could not send the cheques towards the earnest money.

(3.) The letter dated 14th October, 1976 from the attorneys for the defendants was received by the plaintiff whereby it was informed that as the cheques for the earnest money had not been received, defendants had decided to put an end to the negotiations for sale of Noble building, plant and machinery, etc. and they called upon the plaintiff to return the engrossments. Thereafter another letter dated 30th October, 1976 was received from the attorneys of the defendants to return the engrossments. According to the plaintiff, they were trying to settle the matter amicably. Finally on 8th March, 1977, they sent a reply to the letters from the defendants stating the correct facts. On 16th May, 1977, the plaintiff read the notice in 'bombay Samachar' showing that the defendants had agreed to sell the said immovable property to a different person and therefore, the plaintiff filed the suit for specific performance of the contract. According to the plaintiff, it has always been ready and willing to perform its part of the contract under the said two agreements. The plaintiff has also contended that the possession of the stable was given to them by the defendants on 10th september, 1976 in part performance of the contract.