-SA401-2022+.DOC

Santosh

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

CIVIL APPELLATE JURISDICTION

SECOND APPEAL NO. 401 OF 2022

Amit V�ay Bhatewara ...Appellant

Versus

Avinash Vinayak Patwardhan & Anr. ...Respondents

WITH

INTERIM APPLICATION NO. 3044 OF 2022

IN

SECOND APPEAL NO. 401 OF 2022

Mr. Kaustubh Thipsay a/w Ms. Ketki Gadkari, for the

Appellant.

Ms. Shirin Merchant a/w Farinaz Pathan, for the Respondents.

CORAM:N. J. JAMADAR, J.

Reserved On:21

st

JANUARY, 2026

Pronounced On:28

th

JANUARY, 2026

JUDGMENT:-

1.Heard the learned Counsel for the parties.

2.This second appeal is directed against a judgment and

decree dated 31

st

March, 2022 passed by the learned District

Judge, in Regular Civil Appeal No.104 of 2019, whereby the

appeal preferred by the appellant – plaintiff against a judgment

and decree in Special Civil Suit No.835 of 2010, dismissing the

suit for speci�c performance, came to be dismissed by af�rming

the decree passed by the trial Court.

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SANTOSH

SUBHASH

KULKARNI

Digitally signed by

SANTOSH SUBHASH

KULKARNI

Date: 2026.01.28

20:13:43 +0530

-SA401-2022+.DOC

3.Shorn of super�uities the background facts can be stated

as under:

3.1The defendants - respondents are the owners of Flat No.2

alongwith a parking lot in Tridal Co-operative Society Ltd.,

Prabhat Road, Pune, (“the suit �at”). The defendants entered

into a registered agreement to sell the suit �at for a

consideration of Rs.50,00,000/-. A sum of Rs.1,00,000/- was

accepted thereunder as part consideration. The balance amount

was agreed to be paid at the time of execution of conveyance.

The possession of the suit �at was also agreed to be delivered

upon payment of balance consideration and execution of

conveyance. The parties agreed,

inter alia, that the defendants -

transferors shall obtain the consent of Tridal Society (D2) for the

transfer of the suit �at before execution of the sale deed.

3.2Defendant No.1 applied to the Society (D2) for grant of

consent for transfer. The Society did not give the co nsent.

Proceedings were initiated before the Deputy Registrar, Co-

operative Societies, for obtaining the consent of the Society for

the said transfer. In the meanwhile, the plaintiff paid a sum of

Rs.30,00,000/-, towards further consideration to the defendants

and the defendants executed a registered deed of receipt and

con�rmation acknowledging the receipt of the sum of

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Rs.30,00,000/- on 30

th

August, 2007. Eventually, as the

defendants could not obtain the consent for transfer, on 19

th

September, 2007, a supplementary agreement came to b e

executed and registered, under which the defendants refunded

the amount of Rs.30,00,000/-. It was agreed that the plaintiff

shall pay the balance consideration of Rs.49,00,000/- u pon

obtaining the consent of the Society for the said transfer, and at

that time possession of the subject �at would be delivered.

3.3It appears despite diligent efforts and proceedings before

the Deputy Registrar, Co-operative Societies, consent fo r

transfer could not be obtained. The defendants, thus ,

addressed a communication to the plaintiff on 18

th

April, 2008

seeking to cancel the agreement for sale and return the amount

of Rs.1,00,000/- to the plaintiff. This was followed by a further

communication dated 27

th

April, 2008, whereby the defendants

professed to cancel the agreement for sale and the

supplementary agreements, and offered to return the amount of

Rs.1,00,000/-. The plaintiff addressed a legal notice to the

defendants on 3

rd

March, 2010 seeking speci�c performance of

the contract. Upon refusal by the defendants, the suit for

speci�c performance of the contract was �led.

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3.4After appraisal of the evidence and the material on record,

the learned Civil Judge dismissed the suit observing that the

plaintiff had not been ready and willing to perform his part of

the contract. The purported inaction on the part of the plaintiff

from the date of termination of the agreement for sale till the

issue of legal notice, and admissions in the cross-examination of

the plaintiff that the consent of the Society was not a legal

requirement for effecting the sale, were arrayed against the

plaintiff to return a �nding that the plaintiff failed to establish

continuous readiness and willingness to perform the contract.

3.5Being aggrieved, the plaintiff preferred an appeal before

the District Court.

3.6By the impugned order, the learned District Judge

dismissed the appeal concurring with the view of the tria l

Court. The delay on the part of the plaintiff in instituting the

suit after the notice of termination of the agreement for sale

dated 27

th

April, 2008 and the purported inaction, in the

intervening period, weighed with the learned District Judge to

answer the issue of readiness and willingness against th e

plaintiff.

4.Mr. Thipsay, the learned Counsel for the appellant,

submitted that both the courts have committed a grave error in

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law in returning the �nding that the plaintiff was not ready and

willing to perform his part of contract. Amplifying the

submission, Mr. Thipsay would urge, both the Courts have erred

in not properly appreciating the evidence, especially the fact

that the plaintiff had paid a substantial part of consideration

i.e. Rs.30,00,000/- and the said amount was refunded by the

defendants on account of their failure to obtain ‘no objection’

from the Society. The parting of such huge considerat ion of

Rs.30,00,000/- underscored both readiness and willingness on

the part of the plaintiff to perform his part of the contract.

Such misreading of evidence and the documents which rec ord

the circumstances in which the amount was refunded by the

defendants gives rise to a substantial question of law.

5.Secondly, Mr. Thipsay would urge, the learned Civil Judge

as well the learned District Judge completely misdirected

themselves in holding that there was delay on the part of the

plaintiff in seeking the relief of speci�c performance.

Incontrovertibly, the suit was instituted within the stipulated

period of limitation. Moreover, both the courts lost sight of the

well-recognized principle that in suits for speci�c performance

of contract to sell immovable property, time is not the essence of

the contract. Once the suit was instituted within the stipulated

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period of limitation, the courts could not have dismissed the

suit for speci�c performance on the ground that there was delay

in seeking speci�c performance of the contract. To buttress

these submissions, Mr. Thipsay placed reliance on the

judgments of the Supreme Court in the cases of Chand Rani

(Smt) (Dead) by LRs. vs. Kamal Rani (Smt)(Dead) By LRs.

1

,

Bismillah Begum (Smt) Dead by LRs. vs. Rahmatullah Khan

(Dead) by LRs.

2

, P. Daivasigamani vs. S. Sambandan

3

and R.

Lakshmikantham vs. Devaraji

4

.

6.Mr. Thipsay would further urge that, the learned Civil

Judge and the learned District Judge committed a manifest

error in placing reliance on the admissions in the cross-

examination that, in law, ‘consent’ of the Society (D2) was not

necessary for effecting a transfer, when there was an express

stipulation in the agreement for sale that the defendants would

obtain the consent of the Society before the sale of the subject

�at. Such misconstruction of the document and evidence has

resulted in a complete miscarriage of justice, submitted Mr.

Thipsay.

1 (1993) 1 Supreme Court Cased 519.

2 (1998) 2 Supreme Court Cases 226.

3 (2022) 14 Supreme Court Cases 793.

4 (2019) 8 Supreme Court Cases 62.

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7.Per contra, Ms. Merchant, the learned Counsel for th e

respondents, submitted that the impugned decree is rested on

sound legal reasoning. The plaintiff, despite being cognizant of

the fact that the consent of the Society (D2) was not warranted,

insisted for the same and, thus, the courts were justi�ed in

holding that the plaintiff was not ready and willing to perform

his contract. In the circumstances of the case, whe n the

defendants sought to terminate the agreement for sal e, the

plaintiff never offered to complete the transaction by paying the

balance consideration, without insisting for the consent of the

Society. After a delay of almost two years, the plaintiff gave the

pre-suit legal notice. Thus, no question of law, much less a

substantial question of law, arises for determination in this

appeal, urged Ms. Merchant.

8.It is trite, in case of sale of immovable property, there is a

presumption against time being the essence of the contract. In

the case of Chand Rani (supra), the Constitution Bench of the

Supreme Court, after analysis of the precedents, enun ciated

that in case of sale of immovable property there is no

presumption as to time being the essence of the contract. Even

if it is not of the essence of the contract the Court may infer

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that, it is to be performed in the reasonable time if the

conditions are evident;

(i) from the express terms of the contract;

(ii) from the nature of the property; and

(iii) from the surrounding circumstances, for example; the

object of making the contract.

9.In the facts of the case, the suit appeared to be within the

statutory period of limitation, as the suit was instituted on 10

th

October, 2010, even if it is assumed that the refusal to perform

the contract became known to the plaintiff from the

communication dated 27

th

April, 2008. The Courts have

proceeded on the premise that there was delay in instituting the

suit from the date of the termination of the agreement for sale

and, therefore, the plaintiff was not entitled for the discretionary

relief of speci�c performance of the contract.

10.In the case of R. Lakshmikantham (supra) the Supreme

Court did not approve the view of the High Court that the delay

in �ling the suit indicated that the plaintiff was not ready and

willing to perform his part of the contract in the said case. The

Supreme Court enunciated, in India it is well settled that the

rule of equity that exists in England, does not apply, and so long

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as a suit for speci�c performance is �led within the period of

limitation, delay cannot be put against the plaintiff.

11.It would be contextually relevant to note that in a suit for

speci�c performance, the element of delay comes in the frame in

different contexts. Even if the delay does not exce ed the

stipulated period of limitation (in which case the suit would be

barred by limitation) in a given fact-situation the length of delay

bears upon the exercise of discretion.

12.In the case of Motilal Jain vs. Ramdasi Devi (Smt) and

others

5

, the Supreme Court expounded the aspects of delay

which become relevant in a suit for speci�c performance. The

Supreme Court reminded that, “it may be apt to bear in mind

the following aspects of delay which are relevant in a case for

speci�c performance of contract for sale of immovable property:

(i) Delay running beyond the period prescribed under the

Limitation Act;

(ii) Delay in cases where though the suit is within the period of

limitation, yet:

(a) due to delay the third parties have acquired rights in

the subject-matter of suit;

5 (2000) 6 Supreme Court Cases 420.

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(b) in the facts and circumstances of the case, delay may

give rise to plea of waiver or otherwise it will be inequitable to

grant a discretionary relief.”

13.In the case of K. S. Vidyanandam and others vs. Vairavan

6

,

the Supreme Court expressly observed that from the

presumption that the time is not essence of the contract in the

case of agreement for sale and that the period of limitation

prescribed for �ling a suit for speci�c performance was three

years, it does not follow that any and every suit for speci�c

performance of the agreement (which does not provide

speci�cally that, time is essence of the contract) should be

decreed provided it is �led within the period of limitation,

notwithstanding the time limits stipulated in the agreement for

doing one or the other thing by one or the other party.

14.In the case of Saradamani Kandappan vs. S. Rajalakshmi

and others

7

, after following the pronouncement in the case of

Chand Rani (supra), the Supreme Court postulated that the

time stipulated for payment of balance consideration will be

considered to be essence of the contract where such intention is

evident from the express terms or the circumstances

6 (1997) 3 Supreme Court Cases 1.

7 (2011) 12 Supreme Court Cases 18.

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necessitating the sale. The observations of the Supreme Court

in paragraph 28 read as under:

“28. The intention to make time stipulated for payment of

balance consideration will be considered to be essence of the

contract where such intention is evident from the express

terms or the circumstances necessitating the sale, set out in

the agreement. If for example, the vendor discloses in the

agreement of sale, the reason for the sale and the reason for

stipulating that time prescribed for payment to be the

essence of the contract, that is, say, need to repay a

particular loan before a particular date, or to meet an urgent

time bound need (say medical or educational expenses of a

family member) time stipulated for payment will be

considered to be the essence. Even if the urgent need for the

money within the speci�ed time is not set out, if the words

used clearly show an intention of the parties to make time

the essence of the contract, with reference to payment, time

will be held to be the essence of the contract.”

15.In the backdrop of the aforesaid position in law, reverting

to the facts of the case, the circumstances in which t he

agreement for sale was professed to be terminated by the

defendants assumed critical salience. Firstly, the defendants

had done all that was within their power in obtaining the

consent of the Society (D2). Initially, the defendants applied to

the Society (D2). Upon its refusal, the defendants approached

the Deputy Registrar, Co-operative Societies, for the redressal of

their grievance. Secondly, the plaintiff conceded in the cross-

examination, in no unequivocal terms that, he was aware that,

‘no objection certi�cate’, from the Society was not a necessary

requirement for completing the sale transaction. Thirdly, the

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defendants had put the plaintiff to notice that on account of the

delay, the defendants were suffering �nancial loss. The letters

dated 18

th

April, 2008 and 27

th

April, 2008 spell out the then

situation in the life of the defendants. As there was no response

to the �rst letter dated 18

th

April, 2008, it appears the

defendants terminated the agreement vide communication dated

27

th

April, 2008. The said letter was served on the plaintiff on

30

th

April, 2008. Fourthly, in response to the letter dated 18

th

April, 2008 though the plaintiff declined to terminate the

agreement, yet, did not offer to make payment of the balance

consideration. Fifthly, there was complete inaction on the part

of the plaintiff from May 2008 till the legal notice was addressed

on 3

rd

March, 2010.

16.The submission of Mr. Thipsay that since there was a

stipulation in the agreement for sale that the defendants would

obtain the consent of the Society before the execution of the sale

deed, there was nothing wrong on the part of the plaintiff in

insisting for the compliance of the said condition, though

appealing at the �rst blush, on a close scrutiny, re�ects upon

the willingness of the plaintiff to perform his part of the

contract. The plaintiff could not have insisted for the

performance of the said condition, which was neither necessary

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for the completion of the transaction nor possible to be

performed by the defendants as there was no obligation on the

part of the Society (D2) to issue such consent. In a sense, the

plaintiff insisted for performance of an impossibility.

17.In the totality of the circumstances, where the plaintiff

was put to notice that, on account of the advanced age of the

defendants, and the �nancial loss, the defendants were

suffering on account of the delay, the transaction was required

to be completed by payment of balance consideration, t he

Courts have not committed any error in arraying the aspect of

delay against the plaintiff in assessing the readiness and

willingness on the part of the plaintiff. In the peculiar facts of

the case, the acceptance of the refund of Rs.30,00, 000/-,

indicates the strictness with which the plaintiff insisted for the

compliance of the condition of obtaining consent of the Society

(D2) rather than demonstrating the readiness and willingness

on the part of the plaintiff, as was sought to be canvassed by

Mr. Thipsay.

18.In the aforesaid view of the matter, I am not inclined to

accede to the submissions on behalf of the appellant that the

misconstruction of the documents and evidence gives rise to a

substantial question of law on the aspect of appreciation as to

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the readiness and willingness to perform the contract on the

part of the plaintiff. The learned Civil Judge as well the learned

District Judge have correctly exercised the discretion in refusing

the speci�c performance. Resultantly, the second appeal

deserves to be dismissed.

19.Hence, the following order:

: O R D E R :

(i)The appeal stands dismissed.

(ii)In view of dismissal of the appeal, IA/3044/2022 stands

disposed.

[N. J. JAMADAR, J.]

At this stage, the learned Counsel for the appellant seeks

continuation of the

status quo.

Having regard to the nature of the controversy and the

reasons which weighed with this Court in dismissing the

Second Appeal, the prayer for continuation of the

status quo

stands rejected.

Mr. Thipsay, the learned Counsel for the appellant,

without prejudice to the rights and contentions of the appellant,

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seeks a direction for the refund of the sum of Rs. 1 Lakh which

was paid by way of earnest amount.

Ms. Merchant, the learned Counsel for the responden ts -

defendants, on instructions, submits that the respondents -

defendants are willing to return the said amount of Rs.1 Lakh to

the appellant.

In view of the consent of the respondents - defendants, the

respondents – defendants are directed to refund the amount of

Rs.1 Lakh to the appellant, within a period of four weeks from

today, without prejudice to the rights and contentions of the

parties.

[N. J. JAMADAR, J.]

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