SUBBA RAO - (1.) THE following judgment of the court was delivered by:
(2.) THIS appeal by certificate raises the question whether the High court went wrong, in the circumstances of the case, to give a decree for specific performance of an agreement to sell in favour of the plaintiff. The facts may be briefly stated : On 23/08/1954, at 10 a.m. defendants 1 and 2, through their Auction Agent, defendant 3, advertised and put their plots Nos. 1 to 4 situated in Narayanguda opposite to Deepak Mahal Theatre to public auction. In regard to plots Nos. 2 and 3 the plaintiff offered the highest bid of Rs. 12,000.00. He wanted to purchase the plots for the purpose of starting his business. When the plaintiff tendered one-fourth of the sale price as earnest money in accordance with the terms of the auction, the defendants unlawfully refused to accept it. On 30/08/1954, the plaintiff gave notice to the 3rd defendant and sent copies thereof to the other defendants calling upon them to obtain from him the one-fourth amount of the sale price as earnest money within 24 hours and pass a receipt therefor and accept the balance of the auction price within a period of one week thereafter in accordance with the condition of the auction sale and to execute a sale deed duly registered in his favour. Defendants 1 and 2 did not give any reply to the said notice. The plaintiff filed the suit in the court of the 4th Additional Judge, City Civil court, Hyderabad, on 18/04/1955, for directing the defendants, inter alia, to execute the saledeed in his favour. Defendants 2 and 3 in their writtenstatementadmitted that therewas an auction sale and that plaintiff was thehighest bidder; butthe 1st defendant, on the other hand, deniedthat there was any final bid or that it was accepted. He further stated that he gave up the idea of selling the plots and that after obtaining the necessary permission from the Municipality he began to build shops on the said plots. The City Civil Judge held that the suit plots were knocked down at the auction in favour of the plaintiff and that the lst defendant refused to take the earnest money. He further held that though the plaintiff gave notice as early as 30/08/1954, to the defendants, he did not take any steps to enforce his contract and that though he knew of the construction a couple of months before he filed the suit, he kept quiet and allowed the 1st defendant to complete his construction and, therefore, it was not a fit case where he could, in exercise of his discretion, give a decree for specific performance; instead he awarded to the plaintiff a sum of Rs. 500.00 towards damages. On appeal, a division bench of the Andhra Pradesh High court, on a consideration of the evidence, came to the conclusion that the delay in filing the suit was due to the illness of the plaintiff's wife and also on account of the demolition of one of his houses by the Municipal Corporation, that he came to know for the first time on 13/04/1955, that the 1st defendant was raising a structure on the suit plots and that without any loss of time within a few days thereafter he filed the suit. The High court also found that the 1st defendant did not act bona fide inasmuch as he chose to rush headlong in raising the structure evidently to defeat the claims of the plaintiff. On those findings, the High court held that the Trial court went wrong on principle in exercising its discretion in favour of the defendants and in refusing to grant a decree for specific performance in favour of the plaintiff. In the result, the High court set aside the decree of the Trial court and gave a decree for specific performance in favour of the plaintiff on his depositing a sum of Rs. 12,000.00 together with stamp papers and registration charges within a month from the date of the decree. It may also be mentioned that the learned counsel for the plaintiff made an offer that his client was willing to pay a sum of Rs. 14,750.00 towards the cost of the building put up by defendants 1 and 2 on the suit plots and the court recorded the same. But, the High court left it to the said defendants either to give vacant possession of the plots or with the structure thereon accepting money for it, as they chose. The lst defendant has preferred this appeal by certificate to this court making the plaintiff the 1st respondent, and defendants 2 and 3, respondents 2 and 3. Mr. Lakshmaiah, learned counsel for the appellant, argued (1) The appellant repudiated the contract on the next day of the auction itself by refusing to take money from the lst respondent; the 1st respondent did not accept the repudiation, but elected to keep the contract alive by asking the appellant to receive from him one-fourth of the amount as earnest money at any time within 24 hours thereof and to obtain from him the entire balance within one week thereafter; by so doing, he not only unilaterally varied the terms of the contract but committed a breach thereof in not paying the amount; having himself committed a breach of the contract, he could not specifically enforce it. (2) Time is the essence of the contract, as the object of purchase by the 1st respondent was to start a business; therefore, the lst respondent should have pursued his remedy with promptitude and diligence. It was not enough to assert his right by issuing a notice, but he should have taken steps to enforce it; his inaction and indifference for 7 months without making any attempt to enforce his right would disentitle him to the discretionary relief of specific performance. (3) The reasons for the delay, namely, that the 1st respondent's wife was ill or that one of his houses was demolished by the Municipal Corporation, were obviously untenable excuses, for both the reasons existed even before the auction was held.
(3.) MR. A. Viswanatha Sastri, learned counsel for the 1st respondent, on the other hand, contended as follows : (1) Mere delay in filing a suit for specific performance could not possibly be a ground for exercising a discretion against a plaintiff, as the Limitation Act prescribed a period of 3 years for filing such a suit. (2) Under the Indian law relief of specific performance could be refused only if the plaintiff abandons or waives his right under the contract; and in the present case the appellant had not established either abandonment or waiver by the 1'st respondent of his right under the contract, for indeed as soon as he saw that the appellant had laid foundations for putting up structures on the plots, he rushed without any delay to the court and filed the suit. (3) In the circumstances of the instant case there is no scope for holding that the appellant could have had any reasonable belief that the 1st respondent had waived or abandoned his right, for it was the positive case of the appellant that there was no concluded sale at all. We cannot allow the learned counsel for the appellant to raise before us the first question, namely, that the 1st respondent did not accept the repudiation but kept the contract alive and committed a breach thereof, with the result that he disqualified himself to file the suit for specific relief, for the said plea was not raised in the pleadings, no issue was raised in respect thereof and no argument-. were addressed either in the Trial court or in the High court. As the question is a mixed question of fact and law, we cannot permit the appellant to raise it for the first time before us.;