A.C. Goyal, J.
1. This first appeal by the defendants arises out of suit for specific performance of contract instituted by the plaintiffs. The parties in this appeal would be referred as arrayed in the plaint.
2. The suit was instituted by the plaintiffs (five in number) on 14.8.1991, which the averments the defendants who are the owners of house-propriety bearing No.C-86A, Jagraj Marg, Mangal Marg, Bapu Nagar, Jaipur, agreed to seel this property to the plaintiff No. 1 for a consideration of Rs. 17,51,000/-vide agreement dated 8.7.1989. An amount of Rs. 3 lacs was paid in advance on 8.7.1989. The defendants in part performance of the agreement handed-over possession of some portions of this house to the plaintiff as contained in para 5 of the plaint while giving the details of the terms and conditions of the agreement, it was interalia agreed upon between the parties that the defendants would get the house vacated from the tenants within a period of four months from the date of agreement and that the defendant should obtain N.O.C. from the Income Tax Department and thereafter shall get the registered sale deeds executed in favour of the plaintiff No. 1 or in the name of other persons as named by him. Thereafter, half portion of the house (Northern side) was got vacated from the tenants and sale-deed of this half portion was got registered on 9.8.1990 on payment of Rs. 4,37,750/-.
3. It was next pleaded that the defendants vide letter dated 22.12.1989 informed the plaintiff that remaining half portion of the property (Southern side) is now vacant and the plaintiff may take possession of the said portion after making the remaining payment but this information given by the defendants was incorrect as the plaintiff came to know that one tenant Baijnath Ashrfilal is still in occupation in one portion of the house. It has also been pleaded that at the time of registry of the half portion, the plaintiff No. 1 informed the defendants to execute sale-deeds of the remaining half portion in favour of the defendants No.2 to 5 and further asked the defendants to obtain N.O.C. from the Income tax Department. But the defendants did not obtain N.O.C. in the name of defendant Nos. 2 to 5 and vide Notice dated 7.11.1990, the defendants . informed the plaintiff regarding cancellation of the agreement and raised a demand of Rs. 50,000/- as damages in addition to an amount of Rs. 1,50,000/- already deposited with the defendants as an advance consideration for the remaining half portion of the house.
4. It was also pleaded that the plaintiff was/is always ready and willing to perform his part of the contract but the defendants failed to do so.
5. The defendants in their joint written statement admitted the agreement and the terms contained there in with a plea that it was not agreed upon between them that the defendants would get the entire house vacated from the tenants within four months. As per written statement, the entire house was got vacated from the tenants by 26.12.1989 and it is wrong to say that one tenant Baijnath Ashrafilal was in possession of one portion of this house. While admitting the correspondence between the parties, it was stated that the plaintiffs No. 1 never informed from the obtain N.O.C. in the name of remaining plaintiffs and it was the plaintiff No. 1 who was never ready and willing to perform his part of the contract regarding remaining half portion of the house. It was also pleaded that since there was no agreement between the defendant and the plaintiff No. 2 to 5, the present suit for specific performance in favour of defendants No. 2 to 5 is not maintainable and transaction of sale in favour of defendant Nos. 2 to 5 is barred by Section 3 of the Benami Transactions (Prohibition) Act 1988 (for short the 'Act').
6. On the basis of the pleadings of the parties, following Issues were framed.
1 ^^vk;k oknh fo; lEifr gsrq fo; vuqcU/kfnukafdr 8 tqykbZ] 1989 ds vuqlkj viuk nkf;Ro iw.kZ djus o fo; eqY; Hkqxrku djlEifr dk fo; i= vius i{k esa djus ds fy, ges'kk bPNqqd o rS;kj jgk gS ,oa vcHkh bPNqd o rS;kj gS A
2 vk;k oknh us Lo;a us fo; vuqcU/k fnukad8-7-1989 dk mYya?ku fd;k gS o mldh ikyuk ugha dh gS blfy, izfroknhx.k mDrizfrKki= dks fujLr djus ds vf/kdkjh gS vkSj bl dkj.k oknh bldh fof'k'Bikyuk dh izkFkZuk izkIr djus dk vf/kdkjh ugha gS A
3 vk;k oknhx.k la- 2 rk- 5 ds i{k esaoknx.k la- 2 ls 5- }kjk dher vnk dj fof'k'B ikyuk dh izkFkZuk dk }kjk fo;i= rgjhj o rdehy izfroknhx.k ls dkuwuu djk;k tk ldrk gS A
4 vk;k fo; jkf'k oknh la- ,d }kjk gh fn;ktkuk fo; vuqcU/k ds }kjk vko';d gS ;fn ,slk gS rks fo; i= oknh la[;k 2- rk-5 ds i{k esa djkuk ,d VkatsD'ku gks tkrk gS o csukeh VkatsD'ku izksfgfc'ku ,DV1988 ds vuqlkj voS/k gS o n.Muh; gS] bl dkj.k nkok [kkfjt fd;s tkus ;ksX; gS A
5 vk;k izfroknh {kfriwfrZ ds2]00]000@&:i;s izkIr djus dk vf/kdkjh gS] ftlesa ls izfroknh 1]50]000@&:i;sizkIr dj pqdk gS A
6 vk;k oknh la- 2 rk- 5 dks nkok ykus dk vf/kdkjgS A
7 vuqrks'k**
7. Evidence of the parties was recorded. Vide impugned Judgment dated 17.1.1995, the learned trial Judge decided all the issues in favour of the plaintiffs and thus decreed the suit for specific performance.
8. I have heard learned counsel for the parties. On the basis of the submissions made before this Court, following points arise for consideration:-
'1. Whether the plaintiff No. 1 was and is ready and willing to perform his part of the contract?
2. Whether the suit was not maintainable in absence of fresh agreement?
3. Whether decree for specific performance in favour of plaintiffs Nos. 2 to 5 is illegal?
4. Whether Ex.1 is a Benami Transaction prohibited by the Act, 1988?'
First Point
9. In a suit for specific performance, it is well settled that the plaintiff has to plead and prove that he was and is ready and willing to perform his part of the contract from the date of agreement to the date of filing of the suit.
10. It is admitted case that in performance of the agreement Ex.1, registered sale-deed for half portion of the suit house was executed in favour of the plaintiff No. 1 9.8.1990. The case is, now confined to only remaining half portion. Clause No. 5 of this agreement provides that the defendant No. 1 shall get the property vacated from the tenants within four months from the date of this agreement. Admittedly the defendant No. 1, having taken possession of the half portion informed the plaintiff No. 1 and thereafter the defendants obtained N.O.C. for half portion which is Ex.A. 2, dated 24.7.1990 and thereafter sale-deed for half portion was got registered on 9.8.1990 N.O.C. for remaining half portion of the house was obtained on 10.10.1990, which is Ex.A. 2/1 and sale deed for this remaining half portion was to be executed only after having obtained N.O.C. as per clause No. 5 of the agreement.
11. It was contended by learned senior counsel Mr. Bhandari that the entire house fell vacant by 26.12.1989 and the plaintiff No. 1 was informed accordingly but he did not take any further steps and it shows that he was not ready and willing to perform his part of the contract. Learned senior counsel Mr. Mehta referred Ex.29 letter dated 27.3.1990, whereby the defendants informed the plaintiff No. 1 that entire house is now vacant and the plaintiff should take steps for execution of the sale deed. The plaintiff in reply informed the defendants vide letter Ex.16 dated 5.4.1990 to prepare fresh agreement for the remaining half portion. The plaintiff further informed the defendants that he is ready to pay the balance price, to take possession of the remaining half portion and is also ready to get registered sale deed executed for the entire house if the defendants so agree.
12. Having considered the above submissions and the letters, it is obvious that the entire house fell vacant in between the last week of December 1989 to March 1990 but both the parties agreed to get the registered sale deed executed only for the half portion on 9.8.1990. Even otherwise the registered sale deed was to be executed only after obtaining N.O.C, and the same was obtained on 10.10.1990, which is Ex.A. 2/1 and thus there was no delay on the part of the plaintiff No. 1 for getting the sale deed executed for the remaining half portion.
13. It was next submitted by Mr. Bhandari that the defendants informed the plaintiff No. 1 vide letter ex. 32 dated 12.1.1990 that N.O.C. for the remaining half portion has already been obtained on 10.10.1990 and he was asked to prepare sale-deed for its registration within 15 days but no step was taken by the plaintiff No. 1. Mr. Mehta placing reliance upon Govind Prasad v. Hari Dutt (1), contended that time was not essence of the contract between the parties. The Hon'ble Supreme Court held that fixation of the period within which the contract has to be performed does not make the stipulation as to time the essence of the contract. When a contract relates to sale of immovable property it will normally be presumed that the time is not the essence of the contract. The intention to treat time as the essence of the contract may be evidenced by circumstances which should be sufficiently strong to displace the normal presumption that in a contract of sale of land stipulation as to time is not the essence of the contract. In the instant case the defendants vide letter Ex. 27 dated 22.12.1989 informed the plaintiff No. 1 that the two tenants have vacated half of the portion of the house and the plaintiff No. 1 should make the payment within 15 days so that the defendants may obtain N.O.C. The plaintiff made payment of Rs. 2,87,500/- on 17.1.1990 and this payment though after expiry of 15 days was accepted by the defendants. First N.O.C. Ex.A 2 was obtained on 24.7.1990 and the sale deed for the half portion was got registered on 10.10.1990. It shows that first N.O.C. was obtained after a period of more than six months of the payment and sale deed was got registered after about two and half months of N.O.C. Ex.A. 2. In view of these circumstances, it is evident that it was never the intention of the parties to treat time as the essence of the contract. It is also significant to say here that in reply to the letter Ex.32 dated 12.10.1990, the plaintiff No. 1 vide letter Ex. 18 dated 20.10.1990 informed defendants to obtain N.O.C. in the name of four persons named in this letter, who are the defendants Nos. 2 to 5 with a further specific prayer that the defendants should supply a photostat copy of N.O.C. so that the plaintiff may purchase the stamps in the name of the person N.O.C. has been obtained by the defendants. All this correspondence between the parties very well proves that the plaintiff No. 1 was always ready and willing to perform his part of the contract from the date of the agreement to the date of filing of the suit.
Second Point
14. According to learned counsel for the defendants, it was the condition precedent agreed upon between the parties that a fresh agreement for the remaining half portion shall be executed but the plaintiff No. 1 did not take any steps in this regard, hence the suit was not maintainable in absence of fresh agreement and thus there was no concluded contract between the parties. Reliance was placed upon Narain Singh v. Dalip Singh (2), wherein it was held that the suit for specific performance can only be founded on a contract and position of law cannot be doubted that a suit for specific performance must allege a concluded contract. While taking similar view, it was held by Hon'ble Supreme Court in Ganesh Shet v. Dr. C.S.G.K. Setty and Ors. (3), that in a suit for specific performance of contract, the contract on which relief was based was found to be not a concluded contract, the relief can not be given on basis of subsequent agreement when it was not proved to be fresh of independent contract. In Jyoti Brothers v. Shree Durga Mining Co. (4), it was held that where an arbitration clause provides that in the event of any dispute arising out of this contract the same can be settled by arbitration. Such clause means that after a dispute has arisen, the parties have to further agree that their dispute shall be referred to arbitration and thus this clause at best means that it was a contract to enter into a contract and the Court held that such a contract to enter into a contract is not a valid contract. Mr. Mehta submitted that firstly, it was the duty of the defendants to execute fresh agreement and secondly the defendants never pressed this clause and thus Ex. 1 in itself is a concluded contract.
15. Clause 8 of the agreement Ex. 1 provides that for the remaining half portion, which is not vacant, the defendant No. 1 would execute a fresh agreement and thereafter the defendant No. 1 would obtain N.O.C. and upon receiving the information of N.O.C. the plaintiff No.1 shall pay the balance price within 15 days and thereafter the sale deed for the remaining half portion would be executed. In view of this clear condition in Clause 8, it was the duty of the defendant No. 1 to execute fresh agreement for the remaining half portion after getting the same vacated from the tenants. No doubt the defendant No. 1 vide letter dated Ex. 29 dated 27.3.1990, asked the plaintiff to execute fresh agreement but it is significant to say here that execution of the fresh agreement of the entire house was asked by the defendant No. 1 and not for execution of the fresh agreement for remaining half portion as provided in Clause 8 of the agreement. The plaintiff No. 1 in reply of this letter informed the defendant No. 1 vide letter Ex.16, dated 5.4.1990 that it was the duty of the defendant No. 1 to execute fresh agreement for the remaining half portion and the plaintiff No. 1 is ready to pay the balance price. It was also informed to the defendants vide letter ex. 16 that in case the defendants are ready the plaintiff No. 1 is ready to get one sale deed for the entire house. In view of such specific letter given by the plaintiff No. 1 to the defendants the submissions made by Mr. Bhandari appear to be devoid of merits. Otherwise also the agreement Ex. 1 is a concluded contract in itself and in absence of any fresh agreement for the remaining half portion, the plaintiff was entitled to enforce this agreement as it were the defendants who failed to execute any fresh agreement as provided by Clause 8 of the agreement Ex. 1. According this point is decided against the defendants-appellants.
Third Point
16. Admittedly, there was no agreement/contract between the plaintiffs No. 2 to 5 and the defendants. According to learned senior counsel Mr. Bhandari in absence of any contract between them, decree for specific performance in their favour is illegal, he placed reliance upon Mool Chand v. Ram Phool and Anr. (5). The facts of that case in brief are that the suit was originally filed by Jagdish Prasad against the defendant Mool Chand for specific performance of the contract. By way of an amendment application, the plaintiff Jagdish Prasad pleaded that, he was benamidar for Ram Phool, Who is now plaintiff and that it was Ram Phool who was the real purchaser of the disputed property. In view of these facts, it was held that since Ram Phool was not a party to the contract nor was he as representative in interest of the original plaintiff, Ramphool had no right to enforce the agreement between fhe original plaintiff and defendant. In Raj K. Mehra v. Mrs. Anjali Bhaduri (6), it was held that in a suit for specific performance of contract, strangers seeking impleadment alleging that they are co-owners, can not be impleaded in such a suit.
17. Learned senior counsel Mr. Mehta while supporting the Judgment and decree of the trial court referred the agreement and the correspondence between the parties and contended that the defendants themselves agreed to execute the sale deed in the name of the persons nominated by the plaintiff No. 1 and thus it is not a case of absence of contract between the plaintiffs No. 2 to 5 and the defendants. In the alternative, it was submitted that vide amended plaint, the plaintiffs came out with an additional prayer that in case the Court comes to this conclusion that no sale deed can be executed in favour of the plaintiffs No. 2 to 5, the same may be executed in favour of the plaintiff No. 1 alone and the plaintiff No. 1 would pay the entire balance price to the defendants and thus the decree may be modified accordingly. In reply, alternative prayer was opposed on the basis that decree can not be modified in absence of any cross appeal on behalf of the plaintiffs.
18. I have considered the rival submission, pleadings and evidence. The Judgments relied upon by Mr. Bhandari are not applicable in the instant case, according the Clause 8 of the agreement it was agreed upon between the plaintiff No. 1 and the defendants that the plaintiff No. 1 has right to get the sale deed executed and registered in his own name or in favour of other persons named by him. A perusal of the correspondence between the parties clearly reveals that the defendants never objected to execute the sale deed of the remaining half portion in the name of other persons named by the plaintiff No. 1. The defendant No. 1 vide letter Ex. 30 dated 11.4.1990 asked the plaintiff No. 1 to inform in whose name the sale deed has to be execute, it is specifically mentioned in this letter that it is for the plaintiff No. 1 to decide in whose name the sale deed the to be registered. In reply of another letter Ex. 32, dated 12.10.1990, the plaintiff No.1 vide letter Ex. 18 dated 20.10.1990 informed the names of plaintiffs No. 2 to 5. it is also important to say here that in the next para of this letter Ex. 18 the plaintiff No. 1 made a specific prayer to the defendants No. 1 that a photo stay copy of the N.O.C. already obtained may be sent to him so that he may purchase the stamps in the name of the person N.O.C. has been obtained. It clearly goes to show that the plaintiff No. 1 was ready to get the sale deed executed either in his own name as N.O.C. was obtained in his name or in the names of plaintiffs No. 2 to 5. Instead of any further step in this regard, the defendants vide legal notice Ex.A. 1 dated 7.11.1990 cancelled the agreement itself. Next submission was that the plaintiff No. 1 never informed about plaintiffs No.2 to 5 prior to letter ex.18, hence, they could not obtain N.O.C. in their names to comply with Clause 8 of Ex.1 in time. But this submission has also no force, as first N.O.C. was obtained after six months of payment and sale-deed of half portion was registered after two and half months of N.O.C. Fact of second N.O.C. was brought to the notice of plaintiff vide letter Ex. 32 dated 12.10.1990 and thereafter the plaintiff No. 1 informed the names of remaining plaintiffs on 20.10.1990, vide Ex.18. Thus, there was no delay on the part of the plaintiff No. 1. The defendant should have taken steps to obtain N.O.C. in the name to these four persons but instead of making any such effort they rather cancelled the agreement ex. 1 itself. Otherwise also the plaintiff No, 1 was ready to get the sale deed executed in his own name as per letter Ex. 18. In view of the entire discussion made hereinabove the decree in favour of the plaintiffs Nos. 2 to 5 is in no way illegal.
Point No. 4
19. Before adverting to the submissions on this point, it would be appropriate to reproduce the relevant provisions of the Act 1988.
Section 2(a) defines 'Benami transaction' as under:
(a) 'Benami transaction' means any transaction in which property is transferred to one person for a consideration paid or provided by another person;
3. Prohibition of benami transactions.- (1) no person shall enter into any benami transaction.
(2) Nothing in Sub-section (1) shall apply to-
(a) the purchase of property by any person in the name of his wife or unmarried daughter and it shall be presumed, unless the contrary is proved, that the said property had been purchased for the benefit of the wife or the unmarried daughter;
(b) the securities held by a-
(i) depository as a registered owner under Sub-section (1) of Section 19 of the Depositories Act, 1996;
(ii) participant as an agent of a depository.
Explanation. - The expression 'depository' and 'participants' shall have the meanings respectively assigned to them in Clauses (e) and (g) of Sub-section (1) of Section 2 of the Depositories Act, 1996)
(3) Whoever enters into any benami transaction shall be punishable with imprisonment for a term which may extend to three yeas or with fine or with both.
(4) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), an offence under this section shall be non-cognizable and bailable.
4. Prohibition of the right to recover property held benami.-(1) No suit, claim or action to enforce any right in respect of any property held benami against the person in whose name the property is held or against any other person shall lie by or on behalf of a person claiming to be the real owner of such property.
(2) No defence based on any right in respect of any property held benami, whether against the person in whose name the property is held or against any other person, shall be allowed in any suit, claim or action by or on behalf of person claiming to be the real owner of such property.
(3) Nothing in this section shall apply, -
(a) Where the person in whose name the property is held is a coparcener in a Hindu Undivided family and the property is held for the benefit of the coparceners in the family; or
(b) where the person in whose name the property is held is a trustee of other person standing in a fiduciary capacity, and the property is held for the benefit of another person for whom he is a trustee or towards whom he stands in such capacity.'
It was contended by learned senior counsel Mr. Bhandari that the property is to be transferred in the name of plaintiff No. 2 to 5, while consideration is to be paid by the plaintiff No. 1 and thus it is a benami transaction. It was also submitted that Section 3 of the Act 1988 prohibits benami transactions and Section 4 prohibits the right to recover property held benami. he placed reliance upon Jayadal Poddar v. Mst. Bibi hazar and Ors. (8), wherein it was held that to determine the question whether a particular sale is benami or not, the courts are usually guided by the circumstances(1) the source from which the purchase money came;(2) the nature and possession of the property, after the purchase, (3) motive, if any, for giving the transaction a benami colour; (4) the position of the parties and the relationship, if any, between the claimant and the alleged benamidar; (5) the custody of the title-deeds after the sale and (6) the conduct of the parties concerned in dealing with the property after the sale. In Mithilesh Kumari and Anr. v. Prem Behari Khare (9), it was held that Act of 1988 can be retrospective by necessary implication. He referred Ex. 4 to Ex. 12 and submitted that the plaintiff No. 1 had no funds to pay the balance price.
20. Per cortra learned senior counsel Mr. Mehta submitted that it is not a case of Benami transaction as the stage of the Benami transaction has not arrived at in view of the Judgment of the Hon'ble Apex Court in Jaydayal's case (supra). It was also submitted that according to the statement of the plaintiff himself and the documents Ex.4 to 11, the balance price for the remaining half portion was to be paid by the plaintiffs No. 2 to 5.
21. I have considered the rival submissions in the light of relevant provisions of law and the Judgments relied upon by Mr. Bhandari and am of the view that it is not a case of Benami transaction because no property has been transferred by the plaintiff No. 1 in the name of remaining plaintiffs for a consideration paid or to be paid by him. This is a case for specific performance of the contract and the defendants themselves agreed to execute the sale deed of the remaining half portion, either in the name of plaintiff No. 1 or in the name of other persons nominated by him. It is also correct to say that the stage of prohibition of the right to recover property held Benami lias not arrived at in view of the Judgment of Hon'ble Supreme Court in Jayadayal's case (supra). The facts and circumstances of this case clearly show that it is not a case of benami transaction. P.W. 1 (the plaintiff No.1 himself) stated that the plaintiff No. 2 is his brother. As per Mr. Mehta plaintiff No. 2 Murlimanohar is cousin brother of the plaintiff No. 1, plaintiff No. 3 is wife and the plaintiff nos.4. and 5 are sons of plaintiff No. 2 P.W. 1 admitted that some of the price amount was paid by him and some of the amount has paid by plaintiff No.2. P,W. 1 further stated that Ex. 4 to Ex. 11. bank accounts except Ex.7, Ex.9 & Ex. 10, are in the name of the remaining plaintiffs. Thus the oral testimony of the P.W. 1 finds corroboration form these documents that the payment of balance price was to be made by remaining plaintiffs. A perusal of Section 4 of the Act 1988 goes to show that the provisions of this section would come into operation only when a dispute arise between the plaintiff No; I and the remaining plaintiff and the defendants would have no concern with such a dispute, therefore, this point is also decided against the defendants-appellants.
22. It has next contended by Mr. Bhandari that the plaintiff No. 5 Lokesh was minor at the time of filing the suit, hence a contract by a minor is void as he was not competent to contract according to Section 11 of the Indian Contract Act, 1872, Mr. Mehta, submits that this agreement was for the benefit of the plaintiff No. 5 who was 16 years of age at that time and now he is major and has raised no objection in this regard. Having considered the above submissions, I find no me it in this submission also.
23. In view of the entire discussion made here-in-above, this appeal, being devoid of merit is hereby dismissed with costs.