He relied upon the judgment of this Court in Badriprasad K. Agarwal and Anr. v. The Premier Garage & Ors., in this regard wherein Justice R. A. Jahagirdar has referred to a judgment of Calcutta High Court, in A.E.G. Capapiet v. A. Y. Derderian, wherein it is observe :
"Wherever the opponent has declined to avail himself of the opportunity to put his essential and material case in cross-examination, it must follow that he believed that the testimony given could not be disputed at all. This is not merely a technical rule of evidence, it is a rule of essential justice."
This judgment however is of no help to the defendant because if the defendant putforth a case not pleaded by her and about which there is no whisper in her written statement, it is not incumbent and necessary upon the plaintiff to cross-examine the witness in that regard. The plaintiff can simply point out that the evidence of the defendant, which is beyond the pleadings and beyond the issue, should be disregarded. Therefore, even if it is accepted for the sake of arguments that there is no cross-examination of the defendant about the novation to the agreement which she tried to prove through her evidence (as discussed above), then it does not mean that the plaintiff admitted and accepted her evidence. That evidence of the defendant, which is beyond the pleadings, has to be rejected even in the absence of any cross-examination.
Bombay High Court
Haren Krishnakumar Mehta vs Kamla Pribhdas Nebhanani on 11 October, 2000
Equivalent citations: AIR 2001 Bom 187, 2001 (2) BomCR 678, (2001) 1 BOMLR 228, 2001 (2) MhLj 45
Bench: D Deshpande
1. This is a suit filed by the plaintiff for a declaration that the agreement dated 1st April, 1978 is valid and subsisting and the plaintiff is entitled to specific performance thereof, and for specific performance and other incidental reliefs. The case of the plaintiff, in short, is as under :-
2. The defendant was the owner of the suit flat. She was the member of Merryland Co-operative Housing Society Limited. She was also the owner of the furniture and fixtures. She entered into an agreement of sale with the plaintiff for the shares, suit flat and the furniture and fixtures for a sum of Rs. 1,65,000/- upon the terms and conditions mentioned in the said agreement. The plaintiff paid Rs. 10,000/- as an earnest money. The balance was to be paid after giving possession of the suit flat by the defendant and transferring the flat to the plaintiff. That the possession was given on or before 30.4.1978. The date of this agreement is 1.4.1978. According to the plaintiff, the defendant applied to the society in May, 1978 for transferring the shares and flat in the name of the plaintiff. The society by their letter 13.5.1978 asked the plaintiff to give undertaking. There upon the plaintiff gave necessary undertaking and also paid transfer fee by a cheque. Thereafter the defendant resiled from the agreement and tried to return the amount of Rs. 10,000/- to the plaintiff by her letter dated 23/ 25th May, 1978 on the ground that the society has refused to accept the plaintiff as its member. The dispute therefore arose between the parties because according to the plaintiff, the society informed him by their letter dated 2nd June, 1978 that the society had no objection to transfer the suit flat in the name of the plaintiff. According to the plaintiff, the defendant has deliberately and mischievously cancelled the agreement and tried to cancel the agreement while he was all the while ready and willing to perform his part of the contract, and therefore, he filed this suit for specific performance.
3. The defendant filed her written statement admitting therein agreement between the parties. However, according to her, she submitted all the documents and necessary papers along with the copy of the agreement on 28.4.1978. Thereafter the plaintiff was interviewed by the society. But since the plaintiff stated before the society that he would not be occupying the flat himself, the society refused the permission to the plaintiff by their letter dated 7.5.1978. The defendant further stated that though the society initially rejected and refused the plaintiffs proposal for the aforesaid reasons, the plaintiff re-submitted his application to the society contending therein that he wanted the flat for his residence. According to the defendant, the management of the society disbelieved the changed statement of the plaintiff and wanted undertaking to that effect and since the undertaking was not given by the plaintiff to the satisfaction of the society, the society refused to recognize the same and refused to transfer the said flat to the plaintiff, and consequently, the defendant wrote a letter dated 20.5.1978 to the society and the society returned all the papers to the defendant and finally rejected the transfer proposal, and therefore, the defendant returned the sum of Rs. 10,000/- by way of cheque. The plaintiff accepted the refund unconditionally and therefore he has no right in the suit flat. The defendant has also alleged that the plaintiff at the relevant time was not ready and willing to perform his part of the contract, and therefore, he was not entitled to the reliefs claimed.
4. On the basis of these pleadings the following issues were framed by me on 29th June 2000.
ISSUES :
(1) Whether Merryland Co-op. Hsg. Society Ltd. is necessary party as alleged in para 2 of the written statement?
(2) Whether the plaintiff is entitled to specific performance of the agreement dated 1.4.1978 on payment of balance purchase price as prayed for?
(3) Whether the agreement dated 1.4.1978 Exhibit B to the plaint is valid and subsisting?
(4) Whether the agreement dated 1.4.1978 has come to an end as per clause 11 of the agreement and as such the plaintiff has no cause of action as alleged in para 24 of the written statement?
(5) Whether earnest money of Rs. 10,000/- has been returned and or paid by the defendant to the plaintiff as alleged in para 10 of the written statement?
(6) Whether the plaintiffs request for admission as a member of the said co-operative society was turned by the society after the plaintiff had been interviewed by the screening committee of the society and as per society's letter dated 7th May, 1978 being Exhibit 3 to the written statement and resulting as the cancellation of the suit agreement?
(7) What decree and order?
REASONS
5. Thereafter the plaintiff examined himself in support of his contentions and defendant examined herself in reply. I then heard the arguments of Advocates for the plaintiff and defendant at length.
6. It was contended by counsel for the plaintiff that there is no breach of agreement or any terms of the agreement on the part of the plaintiff, that though the society had specifically agreed to make the plaintiff as member of the society, the defendant refused to perform her part and unilaterally and illegally tried to terminate the agreement, and there, defendant was at fault and therefore, the plaintiff was entitled for the reliefs claimed.
7. On the other hand, counsel for the defendant contended that breach of the terms of the agreement was committed by the plaintiff, that time was the essence of contract and plaintiff did not fulfil the requirements of the society and consequently the defendant had no option but to terminate his agreement and since the amount of Rs. 10,000/- was returned to plaintiff and agreement was terminated, the plaintiff was not entitled to claim any relief.
8. In view of these submissions, it is necessary to scrutinize the evidence and decide the issues.
9. ISSUE NO. 1 :-
So far as Issue No. 1 is concerned, the society is not necessary party to the suit because no relief is claimed against the society. When the plaintiff is entitled to get specific performance, then the society will have to accept the plaintiff as its member, and since that has already been done by the society, joining of the society was not necessary. Therefore, my finding on issue No. 1 is in the negative i.e. Marryland Co-operative Housing Society Ltd. is not the necessary party as alleged in the written statement.
10. ISSUE NO. 6 :-
Before considering other Issues, it is necessary to decide Issue No. 6 because on the basis of the evidence, that has been adduced, Issue No. 6 does not survive. It is an admitted fact that after execution of the agreement dated 1st April, 1978 the plaintiff and defendant both applied to the society for making the plaintiff as member of the society. It is an admitted fact that at that time the plaintiff had represented to the society that he would not be occupying the suit flat but someone else occupying the suit flat. It is also an admitted fact that the society rejected the application of the plaintiff because he was not going to occupy the suit flat. However it is a matter of record that thereafter the defendant immediately informed the plaintiff of this decision of the society and then plaintiff made a representation to the society, he was interviewed by the Managing Committee of the society wherein the plaintiff changed his stand and represented to the society that he would himself be occupying the suit flat and upon this representation the society agreed to accept the plaintiff as its member. There is no dispute of this last order of the society because it was this order which was specifically challenged by the defendant before the Authorities under the Co-operative Court and wherein she failed as per Exhibit G, tendered by the plaintiff during his examination in chief, which is a copy of the order in that regard. Therefore, eventhough it is a fact that the plaintiffs request was turned down by the society initially, that cannot and did not result in cancellation of the suit agreement because eventhough earlier cancellation was on 7.5.1978, the society thereafter accepted the plaintiff as its member and obtained indemnity bond against him, and therefore, even if the findings on this issue is partly in the affirmative that the society had rejected the plaintiffs application for membership, agreement does not stand cancelled because of the subsequent decision of the society.
11. ISSUE Nos. 1, 2 AND 3 :-
There is no dispute that the parties entered into an agreement dated 1st April. 1978 and the plaintiff paid Rs. 10,000/- as earnest money towards part of consideration. Only question therefore would he whether defendant is justified in terminating the agreement for the reasons stated by her. It is pertinent to note in this regard that nowhere in the written statement, the defendant alleged that the time was an essence of contract, nor does the agreement show that time was the essence of contract. Merely putting a date for execution of the agreement does not make the time as an essence of contract. The parties must specifically aver and plead and such stipulation must be there in the agreement itself, and since it is not in the agreement, nor there is any pleading about that, the contention of the defendant cannot be accepted that the time is the essence of contract.
12. Once it is held that the agreement was entered into between the parties and they intended to act upon it, it also becomes immaterial whether society rejected the plaintiff's application for membership on 7.5.1978 because as admitted by the defendant she then consulted the plaintiff and both of them reapplied for making the plaintiff as member of the society that the plaintiff was interviewed by the Managing Committee, he changed his stand and then society agreed to make him member on plaintiffs giving undertaking which the plaintiff specifically gave. Therefore rejection of membership application of the plaintiff by the society on 7.5.1978 is of no consequences, and when both the parties reapplied again and society agreed to make the plaintiff as a member, then burden shifts upon the defendant to prove that inspite of the decision of society the plaintiff failed to perform his part of the contract, and I have no hesitation in holding that the defendant has failed to prove any breach on the part of the plaintiff.
13. The fact that, the defendant was no agreeable to the decision of society to make the plaintiff as its member, is clearly born out from the record because she challenged the decision of the society before the Authorities of Co-operative Court. The plaintiff has filed Exhibit G in that regard which are the certified copies of the orders of the Authorities under Co-operative Court by which the defendant's objection to the decision of society was turned down and rejected.
14. This attempt on the part of the defendant to challenge the decision of society also shows that the defendant for no obvious reason entering into litigation and challenging the membership of plaintiff to the society. If at all it was the defendant who had taken initiative to persuade the plaintiff to reapply to the society for becoming membership after first rejection of the application of plaintiff by the society, then the defendant had no reason to challenge the order of the society before the Authorities under Co-operative Court. Further if at all according to the defendant she had cancelled and terminated the agreement and returned the amount of the plaintiff, then also there was no necessity for her to challenge the decision of society but all these initiatives on the part of the defendant in challenging the decision of society falsify her stand that the plaintiff had committed breach of the agreement and she was entitled to terminate the agreement.
15. Once it is concluded that the time was not essence of the contract and once it is concluded that the society had agreed to accept the plaintiff as its member by their decision after 13.5.1978 and after having accepting security bond from the plaintiff, then the burden shifts upon the defendant to prove that the plaintiff is not entitled to the reliefs claimed.
16. Counsel for the plaintiff repeatedly took me through all the correspondence and letter exchanged between the plaintiff, defendant and the society and tried to contend that each of the letter falsifies the case of the defendant. In fact, the crucial question is, whether the defendant was justified in terminating the agreement and admission of the defendant in that regard or the statement made by her in her evidence shatters her case totally and completely. This admission is given by the defendant in her evidence in para 2 of her examination-in-chief wherein she has stated that the society wrote letter dated 13.5.1978 Exhibit B requiring the plaintiff to give undertaking to the society. She showed that letter to the plaintiff and asked him to comply as fast as possible and then comes in shattering admission.
"I told the plaintiff either to take back his Rs. 10,000/- or to give me the balance of consideration, take possession of the flat from me and then deal with the society and all this within one week to be completed."
17. This is totally a new and different case or defence put up by the defendant which she has nowhere pleaded. If this is accepted true then it means that the defendant wanted plaintiff to pay her balance of consideration (without her executing any conveyance) the plaintiff was to take possession of the suit flat and then to fight with the society for all his life. This indicates that the defendant was only interested in receiving balance of consideration. Once she was paid that amount the plaintiff should take risk of fighting with the society for becoming member or for other rights which he was entitled to get as a member. She wanted all this within one week to suit her convenience.
18. All this evidence of the defendant show that she was insisting upon something which was basically illegal and improper. It also indicates that she did not want or she had no patience for the plaintiff being accepted as member of the society, for completing conveyance, for handing over possession and for removing hurdles in the way of the plaintiff. But she was only interested in getting the balance of consideration. This is the statement of the defendant on oath in her examination-in-chief and it destroys all the pleas raised by the defendant in the written statement or raised by way of cross-examination of the plaintiff. In view of these admissions and change of her case, it is not at all necessary to go through the correspondence and other pleas raised by defendant in that regard.
19. The aforesaid statement on oath by the defendant and her further evidence that even though the agreement was entered into with the plaintiff on 1.4.1978, she submitted an application in the prescribed form to the society on 28.4.1978 and the delay in this regard was because she was in search of flat and after she found suitable flat, then she gave this letter to the society. This clearly shows that if at all there was any delay, it was because of the defendant and not of the plaintiff, and when the defendant is herself guilty of delay and latches, her plea that the time was essence of contract (not specifically raised in the written statement and about which there is no Issue) cannot be accepted.
20. Further from the evidence of the defendant and the letters, no reason is given by her as to why she terminated the agreement by her notice and why she returned back Rs. 10,000/- particularly when on her own accord she had taken initiative in making the plaintiff as a member of the society and when the plaintiff had paid to her balance of consideration and has furnished necessary bond to the society, then absolutely no valid and legal ground is put forth by the defendant for termination of the agreement and her attempt to send back Rs. 10,000/- to the plaintiff. It is therefore held that the so-called termination is one sided, unilateral, totally illegal and without there being any sufficient cause.
21. The defendant has, contrary to her written statement, stated, and as discussed above, that she wanted the plaintiff to give her balance of consideration, take possession of the flat and then deal with the society and all this has to be completed within one week. But the plaintiff did not do anything within one week, and her ticket to Germany was expired and flat which she had seen was also lost. I have held that this is totally a new case and a separate oral agreement, which is distinguished and different from the written statement, is sought to be proved by the defendant in the absence of pleadings, and therefore, she cannot be permitted to do so. It is clear that the defendant has terminated the agreement because the plaintiff did not concede to her demand that he pays her the balance of consideration, takes possession of the flat and then fights with the society before execution of conveyance by her. Therefore, this so-called termination has to be declared as totally illegal and improper and against the express agreement between the parties.
22. In this background and in view of this evidence of the defendant, her attempt to press into service the correspondence of the plaintiff and defendant with the society and society's reply thereto is of no consequences and it does not help the defendant in any manner whatsoever. Therefore, considering the facts and circumstances, the suit of the plaintiff is required to be decreed in full.
23. It was urged by the counsel for the defendant that certain portion of the evidence of defendant was not challenged in the cross-examination, and therefore, it should be held that her evidence should be accepted and case of the plaintiff should be rejected.
24. He relied upon the judgment of this Court in Badriprasad K. Agarwal and Anr. v. The Premier Garage & Ors., in this regard wherein Justice R. A. Jahagirdar has referred to a judgment of Calcutta High Court, in A.E.G. Capapiet v. A. Y. Derderian, wherein it is observe :
"Wherever the opponent has declined to avail himself of the opportunity to put his essential and material case in cross-examination, it must follow that he believed that the testimony given could not be disputed at all. This is not merely a technical rule of evidence, it is a rule of essential justice."
This judgment however is of no help to the defendant because if the defendant putforth a case not pleaded by her and about which there is no whisper in her written statement, it is not incumbent and necessary upon the plaintiff to cross-examine the witness in that regard. The plaintiff can simply point out that the evidence of the defendant, which is beyond the pleadings and beyond the issue, should be disregarded. Therefore, even if it is accepted for the sake of arguments that there is no cross-examination of the defendant about the novation to the agreement which she tried to prove through her evidence (as discussed above), then it does not mean that the plaintiff admitted and accepted her evidence. That evidence of the defendant, which is beyond the pleadings, has to be rejected even in the absence of any cross-examination.
25. Counsel for the defendant also contended that the plaintiff has not come with clean hand because he had not disclosed in the plaint about the rejection of his application by the society on 7.5.1978. There is no force in this submission because if the society has accepted the plaintiff as a member on 13/14.5.2000 or subsequent to 7.5.1978 then there was no necessity for the plaintiff to plead about the oral rejection of his application by the society. There is no force in the contention of the defendant that 30th April, 1978 was the last day of execution of the agreement and because of the delay on the part of the plaintiff, she was justified in terminating the agreement. I have already pointed out that delay was on the part of the defendant because she submitted the application of the plaintiff for the membership to the society on 28th April, 1978 i.e. two days before expire of the period of agreement. It was also submitted by the counsel for the defendant that attempt on the part of the plaintiff to pay to the society for transfer charges indicating that the plaintiff was aware of the termination of agreement by the defendant. This argument has also to be rejected because the plaintiff did not commit any wrong in giving transfer charges to the society because of the urgency of the defendant to complete the transaction.
26. The strong circumstance that goes against the defendant is that her challenge to the decision of the society to accept the plaintiff as a member proved to be futile, because the Authorities under the Co-operative Court rejected her application or appeal.
27. For all these reasons my findings on the issues are therefore as under :-
Issue No. 1 in the negative. Marryland Co-operative Housing Society Limited is not the necessary party as alleged in the written statement.
Issue No. 2 in the affirmative. The plaintiff is entitled for specific performance.
Issue No. 3 in the affirmative. The agreement dated 1.4.1978 is valid and subsisting.
Issue No. 4 in the negative. The agreement has not come to an end as alleged by the defendant or as per clause 11 of the said agreement.
Issue No. 5 Yes. But the attempt of the defendant to return of Rs. 10.000/- to the plaintiff was totally illegal and improper and therefore it does not affect the agreement dated 1.4.1978.
Issue No. 6 Partly affirmative. It does not result in cancellation of agreement.
Issue No. 7 The Plaintiff is entitled to all the prayers in the suit.
Hence I pass the following order :
ORDER
28. The suit of the plaintiff is decreed on the following terms :-
(a) It is declared that agreement dated 1st April, 1978 was valid and subsisting and the plaintiff is entitled for specific performance.
(b) The defendant is ordered and decreed to specifically perform the suit agreement dated 1st April, 1978 and upon receipt of balance of purchase price the defendant is ordered and decreed to put the plaintiff in quiet, vacant and peaceful possession of the suit flat, the shares and the furniture and fixtures described in Exhibit A to the plaint and fulfil other obligations as per prayer (b) within six weeks of this order.
(c) Defendant to bear the costs of the plaintiff and her own.
(d) Court Receiver is directed to hand over to the plaintiff possession of the suit flat, the shares and furniture and fixture described in Exhibit A to the plaint. Court Receiver to pay to the plaintiff the amount deposited by the defendant after realizing his charges. Court Receiver will stand discharged after his costs are paid from out of the amount deposited by the defendant with the Court Receiver.
(e) Certified copy expedited.
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