Time limit cannot be ignored altogether on the ground that time is not the essence of Contract: Supreme Court
The Supreme Court ruled that the time limit cannot be ignored altogether on the ground that time is not the essence of the contract.
Background
The defendant is the owner of the suit property. The defendant executed an agreement of sale in favour of the plaintiff for sale of the suit property.
The communication was responded to by the plaintiff requesting to confirm whether the necessary permission from the Competent Authority under the Urban Land (Ceiling and Regulation) Act, 1976 to sell the suit property had been obtained or not.
The defendant applied to the Secretary to Government of Andhra Pradesh, Revenue Department for granting exemption under Section 20 of the ULC Act for selling the suit property.
The defendant addressed a communication to the plaintiff stating therein that the concerned official had promised her to do the needful. The defendant addressed a communication to the plaintiff stating therein that the requisite permission from the ULC Authorities could not be obtained and therefore, she had cancelled the agreement of sale.
The Government of Andhra Pradesh, granted exemption to the defendant under the provisions of Section 20 of the ULC Act. After coming to know about the same, the plaintiff issued a legal notice to the defendant for execution of the sale deed in pursuance of the agreement of sale.
Arguments
Senior Advocate C. Nageswara Rao, appearing for the appellants, submitted that the findings of the Single Judge as well as the Division Bench of the High Court are based upon misinterpretation of evidence.
He contended that the Single Judge and the Division Bench have, through their own interpretation, imported a condition which is not in existence.
Advocate Sridhar Potaraju, appearing for the respondents, submitted that the Single Judge as well as the Division Bench of the High Court has concurrently held that the conduct of the plaintiff was not such which entitled him for specific relief.
Decision
The division bench of Justice B.R. Gavai and Justice C.T. Ravikumar noted that though the defendant had communicated to the plaintiff that, since the requisite permission from the ULC Authorities could not be obtained and as such, she had cancelled the agreement, the plaintiff did not file any proceeding against the defendant.
The court further noted that it was only after a period of almost 2 years when the defendant obtained the permission after cancellation of the earlier agreement, the plaintiff chose to file the suit.
The bench reiterated that the court should look at all the relevant circumstances including the time limit specified in the agreement and determine whether its discretion to grant specific performance should be exercised.
Taking into consideration the fact that the agreement of sale provided that in the event the permission was not obtained within 75 days, the purchaser shall be entitled to get back his advance money paid after 75 days but not later than 90 days under any circumstances, the court held that the findings of the Single Judge cannot be said to be erroneous.
The court directed the respondents-defendants to pay an amount of Rs.15,00,000/- to the appellants-plaintiffs.
Case title: Kolli Satyanarayana (dead) by lrs. v/s Valuripalli Kesava Rao Chowdary (dead) thr. lrs. and Others
Citation: Civil appeal no. 1013 of 2014
