R. C. CHANDIOK & ANR. versus CHUNI LAL SABHARWAL & ORS.

Citation: [1971] 2 S.C.R. 573 · Decided: 12-10-1970 · Supreme Court of India · Bench: J.C. SHAH · Disposal: Appeal(s) allowed

Cited by 4 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

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B 
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573 
R. C. CHANDIOK & ANR. 
v. 
CHUNI LAi SABHARWAL & ORS. 
October 12, 1970 
[J, C. SHAH AND A. N. GROVER, JJ.) 
Specific Performance-Suit for by vendee-Vendors's title not perfect 
on date of contract and prior sanction of Government necessary.for sale-
Whether v•ndor could claim that vendee has not performed hir part with· 
out perfecting his title and obtaining sanction-Decree of trial court only 
directjng return of the part of purchase money paid by vendee-Vendor 
depositing money in court-If vendee precluded from filing an appeal for 
specific performance. 
The respondents, who had been allotted a plot by .the Rehabilitation'. 
Ministry agreed to sell it to the appellants and received a part of the pur-
chase money. ·On the date of the contract the respondents' title was not 
perfect as the lease deed in their favour had not been executed l:IY 
the 
Governtnent nor did the respondents obtain ·the sanction of the Ministry 
which was necessary for transferring the elot. Therefore, the period for 
execu.tion of the sale-deed was extended ttll after receipt of the sanction. 
But the sanction was ·applied for more than a year later. Meanwhile, the 
respondents wrote to the appellants . stating thU it was uncertain as 
ID 
when the sanction would be-granted, that therefore tho agreement had 
become void on account of uncertainty, but that they. were willing· to have 
the sale,deed registered on payment by the appellants of the balance with· 
out waiting for the sanction. 
Appreoonding that the respondents were 
trying to disR.._ose of too plot to someone else the appellants informed pros: 
pective buyers about the agreement in their favour. They also wrote. to 
the respondents declaring their readiness 
and willingness to pay .the 
balance of the purchase price on the respondents procuring the sanction, 
Thereafter, the sanction was granted, but the respondents never in'formod 
the appellants; but coming to know about it the appellants filed a cuit 
claiming specific performance of the contract. 
The trial court held that the respondents, by their letters made time 
the essence of the contract and refused to decree specific performance, 
but granted a decree for refund of the amount paid. Therea'fter, 
too 
appellants applied to the trial court for an injunction restraining. the res-
pondents from disposing of the11,rcperty, but the injunction was not grant· 
~ and t~e plot was sol~ to a thrrd party, The .appellants filed an appeal 
in the High Court against the decree of the tnal. court refusing specific 
performance, and during the pendency rlf the appeal, the amotmt decreed 
by the trial court was· deposited by the respondents, but the ·appellants· did 
n'?I withdraw the amount. The High Court confirmed the· decree of the 
trial court and also held that once the appellants obtainod satisfaction of 
the decree for the amount paid by them, they became disentitled to 
a 
decree for specific performance. 
In appeal to this Court, 
HELD : (I) There 'kas no question of time having been made the 
~sence ,of the contract by the letters sent by the respondents; nor could 
1t be s~td th.at. the appellants had 'fail-.d to perform their part of the 
agreement wtthtn a reasonable time. [579 E] 
574 
SUPREME COURT REPORTS 
(1971] 2 S.C.R. 
As long as the title of the respondents was incomplete anJ sanction 
for sale was not obtained there ·was no question of completing the sale. 
Also, after the sanction was given, the reSpondent3 did not inform 
the 
appellants so as to enable them 'to p~rform their part of the agreement. 
[578 E-F; ,579 D-E] 
(2) There was nothing to indicate that the appellants were not ready 
and willing to perform their part of the contraet. 
Readiness and willing-
ness must _be determined !from the entirety of the facts and circumstances 
relating to the intention .and conduct of the party concerned. 
In the pre-
sent case, the facts that the appellar.ts informed prospective buyers about 
the existence of the agreement in' their 
fa,·our, that they wrote to 
the 
respondents declaring their readiness and willingness to pay the balance as 
soon as the sanction was obtained, and that they promptly filed the suit, 
showed their .keenness and readiness. 
The appellants 
were carrying on 
business and were in a position to arrange for th.e balance of the p1•rchase 
money. 
It was neither necessary nor incumbent on them to senu 
any 
draft conveyance after the 
respondents had cancelled the 

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