suit for specific performance of agreement to sell

Thus is clear from the fact that the second part "time from which period begins to run" refer to a case where no such date is fixed. Order 1 Rule 10 reads as under: (1) Where a suit has been instituted in the name of the wrong person as plaintiff or where it is doubtful whether it has been instituted in the name of the right plaintiff, the Court may at any stage of the suit, if satisfied that the suit has been instituted through a bona fide mistake, and that it is necessary for the determination of the real matter in dispute so to do, order any other person to be substituted or added as plaintiff upon such terms a the Court thinks just. iv. Any act or thing done by the agent on the strength of power of attorney, is therefore, never construed or treated as having been done by the agent in his personal capacity so as to create any right in his favour but is always construed as having been done by the principal himself. In exercising its judicial discretion under Order 1 Rule 10(2) of the Code, the court will of course act according to reason and fair play and not according to whims and caprice. Servant working in Delhi. (Retd.) "Readiness and willingness" to perform the part of the of the contract has to be determined / ascertained from the conduct of the parties". What makes a person a necessary party is not merely that he has relevant evidence to give on some of the questions involved; that would only make him a necessary witness. If a person is not found to be a proper or necessary party, the Court does not have the jurisdiction to order his impleadment against the wishes of the Plaintiff. Any document executed or thing done by an agent on the strength of power of attorney is as effective as if executed or done in the name of the principal, that is, by the principal himself. In case of specific performance of a contract it cannot be doubted, that the jurisdiction to order specific performance of a contract is based on the existence of a valid and enforceable contract. Such an expression may be pointed, precise and sometimes vague but still meaning is to be gathered by reading of the whole of the pleadings. In the case of Sultan Latif Shamshu ddin Ahmed vs. Shaik Alia Baksh Jani, (2002) 4 ALD 799, (2003) 1 ALT 24, it has been held that the period of limitation begins from the date of refusal by the vendee or the defendant and applying the said principles the period of three years mentioned under Article 54 of the Limitation Act, shall be reckoned from the date of refusal to execute the deed of reconveyance. Namgayal Institute for Research on Ladakh Art & Culture & Ors, High Court of Delhi, OMP No. However, as per the dictum in the matter of: i. Suit for Specific Performance of Contract to sell a residential plot. Where a valid and enforceable contract has not been made by the parties to operate amongst them, the court will not make a contract for them. In this video I shall explain the legal remedy for enforcement of Agreement to Sell. Legal options on being falsely implicated of having impregnated a woman? Through this R.F.A, the appellants have challenged the validity of judgment & decree dated 23.12.2014 whereby the learned Civil Judge 1st Class, Bahawalpur dismissed the appellants’ suit for specific performance of oral agreement to sell dated 22.11.1984 and decreed the respondent’s suit for declaration and possession. A `proper party' is a party who, though not a necessary party, is a person whose presence would enable the court to completely, effectively and adequately adjudicate upon all matters in disputes in the suit, though he need not be a person in favour of or against whom the decree is to be made. That by virtue of the amendment brought about to Section 53-A of the TPA with effect from 24.09.2001 by the Act 48 of 2001, an Agreement to Sell in the nature of part performance cannot create rights unless the agreement is registered and stamped at 90 percent of the duty as of the sale deed as per Article 23-A of the Schedule I of the Indian Stamp Act, 1899 as applicable to Delhi which was accordingly amended by the Act 48 of 2001. ii. In the case of Ahmmadsahab Abdul Mulla (deceased by L.Rs.) Subsequently, X wants to avoid the sale. According to Section 16 (c) of the Specific Relief Act, 1963 in order to get a decree for specific performance of contract, the plaintiff is not only required to aver his readiness and willingness to purchase the suit property all throughout in his pleadings[9] but he is also required to prove his readiness and willingness to perform his part of the obligations under the contract all throughout in course of trial of the suit.[10]. For ordering specific performance of a contract it is necessary first to see whether there has been a valid and enforceable contract and then to see the nature and obligation arising out of it. The transferee must in part performance of the contract take possession of the property, or, of any part thereof. Punishment for criminal intimidation. (c) who fails to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than terms the performance of which has been prevented or waived by the defendant. It is also clear that readiness to perform must be established throughout the relevant points of time. Considering the aforesaid provisions, Honorable Supreme Court in the case of Ramesh Hirachand Kundanmal v. Municipal Corporation of Greater Bombay & Ors. A party to a contract who is damaged because the contract is breached by another party has the option to file a suit for specific performance compelling to perform his part of contract. Section 53-A of the TPA was added to the statute book in the year 1929 and is a modified form of the equity principle of part performance which got developed in England in the case of: Elizabeth Maddison V/s John Alderson, (1883) 8 App. (4) Where defendant added, plaint to be amended.-Where a defendant is added, the plaint shall, unless the Court otherwise directs, be amended in such manner as may be necessary, and amended copies of the summons and of the plaint shall be served on the new defendant and, if the Court thinks fit, on the original defendant. However it was later inserted with the recommendations of the 9th Law Commission's report. (2) Court may strike out or add parties.-The Court may at any stage of the proceedings, either upon or without the application of either party, and on such terms as may appear to the Court to be just, order that the name of any party improperly joined, whether as plaintiff or defendant, be struck out, and that the name of any person who ought to have been joined, whether as plaintiff or defendant, or whose presence before the Court may be necessary in order to enable the Court effectually and completely to adjudicate upon and settle all the questions involved in the suit, be added. The following elements are considered by the court while examining specific performance suit. But this general rule is subject to the provisions of Order I Rule 10(2) of Code of Civil Procedure (`Code' for short), which provides for impleadment of proper or necessary parties. [2] Where under an agreement an option to a vendor is reserved for repurchasing the property sold by him, the option is in the nature of a concession or privilege and it may be exercised on strict fulfilment of the conditions on the fulfilment of which it is made exercisable. i. 2,90,000 out of which an amount of Rs. This clause provides that the person seeking specific performance must prove that he has performed or has been ready and willing to perform the essential terms of the contract which are to be performed by him. 12.1) If a plaintiff makes an application for impleading a person as a defendant on the ground that he is a necessary party, the court may implead him having regard to the provisions of Rules 9 and 10(2) of Order I. An agent, therefore, always acts on behalf of the principal and exercises only those powers, which are given to him in the power of attorney by the principal. He does not join in any special covenants made between plaintiff and his vendor; all he does is to pass on his title to the plaintiff. Where a valid and enforceable contract has not been made by the parties to operate amongst them, the court will not make a contract for them. Further, even an irrevocable power of attorney which creates, assigns, declares, extinguishes or limits, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of Rs. Except in cases where power of attorney is coupled with interest, it is revocable. Decision in the matter of: Egon Zhender International (P) Ltd. V/s M/s. Your email is kept confidential and is NOT displayed. [4] Moreover, it is intrinsic to note the difference between ‘sale’ and ‘exchange’ of property. 12.3) If a person makes an application for being impleaded contending that he is a necessary party, and if the court finds that he is a necessary party, it can implead him. This section of Act is widely accepted on its own merits that a suit for specific performance can be lie on the basis of unregistered agreement to sell and can be admissible as evidence. Dictum in the matter of: Suhrid Singh V/s Randhir Singh & Ors, AIR 2010 SC 2807: In the matter of Suhrid Singh (Supra), the Hon’ble Supreme Court of India held as follows: (a) Where the executant of a deed wants it to be annulled, he has to seek cancellation of the deed. Indian Penal Code (IPC) Section 511. C.R. This Court in Ramji Dayawala & Sons (P) Ltd. vs. ii. 637/2012 (Date of Decision: 25.10.2013, and, Coram: Rajiv Shakdher, J. 2012 (1) SCCD 363 (SC) J.P. Builders and another versus A. Ramadas Rao and another. Even in these cases specific performance is not always granted, as it is a discretionary remedy. In essence both may be suing to have the deed set aside or declared as non-binding. 2128/2015, High Court of Delhi, Date of Decision: 03.08.2015 (Coram: Valmiki Mehta, J. Article 54 of the Limitation Act deals with the limitation of suit for specific performance. It must be governed by rule, not by humour; it must not be arbitrary, vague, and fanciful, `but legal and regular'. Specific performance of a contract will not be ordered if the contract itself suffers from some defect which makes the contract invalid or unenforceable. The discretion under the sub-rule can be exercised either suo moto or on the application of the plaintiff or the defendant, or on an application of a person who is not a party to the suit. ): In the matter of: Egon Zhender International (P) Ltd. (Supra) it was held that-. It can be oral. The plaintiff respectfully states as follows : – Inducement: (1) Plaintiff is a Govt. CDR. Please consult legal experts with full details of your case before relying upon the advice given. Do NOT use keywords or dummy names in the Name field. (b) any other person claiming under him by a title arising subsequently to the contract, except a transferee for value who has paid his money in good faith and without notice of the original contract; (c) any person claiming under a title which, though prior to the contract and known to the plaintiff, might have been displaced by the defendant; (d) when a company has entered into a contract and subsequently becomes amalgamated with another company, the new company which arises out of the amalgamation; (e) when the promoters of a company have, before its incorporation, entered into a contract for the purpose of the company and such contract is warranted by the terms of the incorporation, the company; Provided that the company has accepted the contract and communicated such acceptance to the other party to the contract.”. It can also be by a document in two parts, each party signing one copy and then exchanging the signed copy as a consequence of which the purchaser has the copy signed by the vendor and a vendor has a copy signed by the purchaser. While affirming concurrent judgments dismissing a suit for specific performance, the Supreme Court briefly explained the questions which are to be considered in such a suit. It can also be by the vendor executing the document and delivering it to the purchaser who accepts it. ii. It can be by exchange of communications which may or may not be signed. 4. In this case at paragraph 9, the Supreme Court while deciding whether a person is a necessary party or not in a suit for specific performance of a contract for sale made the following observation: “Since the respondent is not a party to the agreement for sale, it cannot be said that without his presence the dispute as to specific performance cannot be determined. Spam or abusive comments or comments with hyperlinks will be deleted. These have to be determined from the entirety of facts and circumstances relevant to the intention and conduct of the party concerned. Specific performance of a contract will not be ordered if the contract itself suffers from some defect which makes the contract invalid or unenforceable. Whether the date was fixed or not the plaintiff had notice that performance is refused and the date thereof are to be established with reference to materials and evidence to be brought on record. [5], In the matter of: Suraj Lamp & Industries (P) Ltd. V/s State of Haryana[6], it was held that, an immovable property can legally and lawfully be transferred or conveyed only by a registered deed of conveyance and that sale vide General Power of Attorney (GPA) does not convey any title. v.   The transferee must have done some act in furtherance of the contract. In case of a lease transaction, the person who transfers the property is known as the lessor, the transferee is known as the lessee and the price paid is called the premium. Any reference to any advocate on this website does not constitute a referral or endorsement, nor does it constitute an advertisement. iii. For deciding the question who is a proper party in the suit for specific performance the guiding principle is that the presence of such a party is necessary to adjudicate the controversies involved in the suit for specific performance of the contract for sale. Among the three subsection, subsection (c) is the most important which was not present in the old Act of 1877. v.         The party suffering from breach of contract shall be entitled to sue the breaching party for the purposes of claiming compensation for the inconvenience and hardship caused to the aggrieved party as a result of the breach of contract committed by the breaching party. 2. The line has been drawn on a wider construction of the rule between the direct interest or the legal interest and commercial interest. The interpretation of such a contract would be governed by the laws of contract relating to the performance of reciprocal promises. Section 17 (1A) of the Registration Act, 1908 came into force with effect from 24.09.2001 and it is prospective in operation. There is no dispute that such transfer made in favour of the subsequent purchaser is subject to the rider provided under Section 52 of the Transfer of Property Act and the restrain order passed by the Court. From the bare reading of the aforesaid provision, it is manifest that sub-rule (2) of Rule 10 gives a wider discretion to the Court to meet every case or defect of a party and to proceed with a person who is a either necessary party or a proper party whose presence in the Court is essential for effective determination of the issues involved in the suit. The aforesaid question was considered by the Calcutta High Court in the case of Kafiladdin and others vs. Samiraddin and others, AIR 1931 Calcutta 67 where Lordship referred the English Law on this point and quoted one of the passage of the Book authored by Dart, on “Vendors and Purchasers” Edn.8, Vol.2, which reads as under :-, “Equity will enforce specific performance of the contract for sale against the vendor himself and against all persons claiming under him by a title arising subsequently to the contract except purchaser for valuable consideration who have paid their money and taken a conveyance without notice to the original contract.”, Discussing elaborately, the Court finally observed:-, “The statement of the law is exactly what is meant by the first two clauses of S.27, Specific Relief Act. Founder and Editor: Dr. Ashok Dhamija, Advocate, Supreme Court, New Delhi. FACTS: The issue in the suit for specific performance was whether the agreement to sell dated 15.05.1990 executed by defendant in favor of the plaintiff would be enforceable in … If a property is transferred in exchange for something other than money, such a transaction would be called an ‘exchange’; the difference between a sale and an exchange is that, in the former, the price is paid in money, while in the latter it is paid in goods, by way of barter. Essentials of Section 10 of the Specific Relief (Amendment) Act, 2018-. i. Therefore, the necessary corollary is that, if a power of attorney is executed by X in favour of Y, and X and Y, both are relatives and the purpose of execution of the power of attorney is grant of authority by X to Y to sell the property owned by X. All the three courts below, on a consideration of the entire materials placed, both oral and documentary, decreed the suit for specific performance. Thus, the question is to be decided keeping in mind the scope of the suit. Where a valid and enforceable contract has not been made, the court will not make a con- tract for them. In view of the aforesaid settled position of law, this suit is not maintainable by virtue of Section 53-A of the Transfer of Property Act read with the amended Article 23-A of the Indian Stamp Act as applicable to Delhi as the Agreement to Sell is unregistered and unstamped and the Power of Attorney besides not entailing the plaintiff to indirectly achieve what cannot be directly achieved is also not stamped on the value of the conveyance deed as required by Article 48 (f) of the Indian Stamp Act as applicable to Delhi…”. Clause (b) of Section 19 makes it very clear that a suit for specific performance cannot be enforced against a person who is a transferee from the vendor for valuable consideration and without notice of the original contract which is sought to be enforced in the suit. A power of attorney is a document of convenience. down that no one, other than the parties to the contract and their legal representatives/transferees, can be impleaded even as a proper party. The contract being the foundation of the obligations that the parties are to discharge inter se between each other, the order of specific performance of contact is to enforce those obligations. [1], An agreement for sale and purchase simpliciter is a reciprocal arrangement imposing obligations and benefits on both parties and is enforceable at the instance of either. The person to be joined must be one whose presence is necessary as a party. For this to happen, a defendant has to go through with a particular action they promised to do instead of only paying money for … The contract being the foundation of the obligations that the parties are to discharge. The decisions in Ramesh Hirachand Kundanmal v. Municipal Corporation of Greater Bombay [1992 (2) SCC 524] and Anil Kumar Singh v. Shivnath Mishra [1995 (3) SCC 147] also explain in what circumstances persons may be added as parties. Under Section 24, Hindu Marriage Act, 1955. Sale of printed or engraved substance containing defamatory matter. 2. AIR 2009 Supreme Court 2193, Hon'ble Apex Court has observed as under: "The inevitable conclusion is that the expression 'date fixed for the performance' is a crystallized notion. The contract must be in writing signed by the transferor, or by someone on his behalf. This was the course followed by the Calcutta High Court in – Kafiladdin v. Samiraddin, AIR 1931 Cal 67 (C) and appears to be the English practice. In the matter of: WG. Creation of lease is not a collateral purpose nor are the terms of lease ‘collateral’ within the meaning of Section 49 of the Registration Act, 1908. ii. Statements conducing to public mischief. Article 54 of the Limitation Act deals with the limitation of suit for specific performance. C.R. complained to FSSAI no response what is the remedy. This provision states that specific performance of a contract cannot be enforced in favour of a person, (a) who would not be entitled to recover compensation for its breach : or, (b) who has become incapable of performing, or violate any essential term of, the contract that on his part remains to be performed, or acts in fraud of the contract, or wilfully acts at variance with, or in subversion of, the relation intended to be established by the contract : or. Intentional insult with intent to provoke breach of the peace. The term ‘interest’ regard being had to Section 202 of the Indian Contract Act, 1872 does not mean ownership or title but an advantage, benefit or a legally enforceable right; and (e) Power of attorney coupled with interest executed by debtor in favour of the creditor-bank, giving authority to the creditor-bank to sell the property owned by the debtor to satisfy the dues that creditor-bank has against the debtor is irrevocable power of attorney, but nonetheless, it has to be stamped as per Article 48 (f) of the Indian Stamp Act as applicable to Delhi. Paragraph 36 is worth to be quoted hereinbelow: “Though there is apparent conflict in the observations made in some of the aforementioned judgments, the broad principles which should govern disposal of an application for impleadment are: 1. Indian Penal Code (IPC) Section 510. If the agreement has not been registered but only notarized or signed on a stamp paper, then you the buyer can send an intimation to the seller that you are no longer interested in proceeding with the purchase (state specific reasons), since no money has been exchanged, the seller will only curse you and also might seek some monetary compensation for causing loss to him (negotiate with him on this … The law of contract is based on the ideal of freedom of contract and it provides the limiting principles within which the parties are free to make their own contracts. Specific performance is a remedy developed by principle of equity. A `necessary party' is a person who ought to have been joined as a party and in whose absence no effective decree could be passed at all by the Court. It can also be by the vendor executing the document and delivering it to the purchaser who accepts it. To find out the true character of an instrument for the purpose of stamp duty, the document should be read as a whole and the dominant purpose of the instrument should be identified. The contract being the foundation of the obligation the order of specific performance is to enforce that obligation.”. Similarly, if P consigns 100 bales of cotton to Q, who has made advances to him on such cotton, and desires Q to sell the cotton, and to repay himself out of the price the amount of his own advances. It is well settled therein that an agent acting under a power of attorney always acts, as a general rule, in the name of his principal. 12. Section 107 of the TPA requires that a lease of an immovable property from year to year or any term exceeding one year or reserving yearly rent, could only be made via a registered instrument. The Specific Relief Act, 1963 deals with the remedies granted at the discretion of the court for the enforcement of individual civil rights. iii. (2) The Court may at any stage of the proceedings, either upon or without the application of either party, and on such terms as may appear to the Court to be just, order that the name of any party improperly joined, whether as plaintiff or defendant, be struck out, and that the name of any person who ought to have been joined, whether as plaintiff or defendant, or whose presence before the Court may be necessary in order to enable the Court effectually and completely to adjudicate upon and settle all the questions involved in the suit, be added." The said provision makes it clear that a court may, at any stage of the proceedings (including suits for specific performance), either upon or even without any application, and on such terms as may appear to it to be just, direct that any of the following persons may be added as a party: (a) any person who ought to have been joined as plaintiff or defendant, but not added; or (b) any person whose presence before the court may be necessary in order to enable the court to effectively and completely adjudicate upon and settle the question involved in the suit. Also be by exchange of communications which may or may not be ordered the... Into force with effect from 24.09.2001 and it is prospective in operation Women from Domestic Violence Act Section. An intention from other circumstances with intent to provoke breach of contract relating power. 80 ( Cal ), [ 12 ] Satish Kumar V/s Karan Singh & Anr, (. Respectfully states as follows: – Inducement: ( 1 ) plaintiff is a Govt buying! 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