TMI Blog2018 (2) TMI 1295X X X X Extracts X X X X X X X X Extracts X X X X ..... no indication about the nature of the income tax clearance certificate required and for what purpose. This clause appears to have been inserted in the agreement to sell without any application of mind and it is quite possible, as alleged by the vendors that the agreement to sell was ante-dated after the introduction of Section 269-UC in the Income Tax Act, 1961. However, we need not go into this possibility in view of the vague nature of the clause. High Court was in error in setting aside the judgment and decree of the Trial Judge. Accordingly, the appeal is allowed and the judgment and decree passed by the High Court is set aside. - Civil Appeal No. 2244 of 2018, (Arising out of Special Leave Petition (C) No.28275 of 2014) - - - Dated:- 16-2-2018 - Mr. Madan B. Lokur And Mr. Deepak Gupta JJ. For the Petitioner(s) : Mr. Rakesh Khanna, Sr. Adv., Dr. K.P.S. Dalal, Adv., Mr. S. Rohan, Adv., Mr. Shree Pal Singh, AOR For the Respondent(s) : Mr. Sumit Bansal, Adv., Mr. Ateev Mathur, Adv., Mr. Ritesh Khatri, AOR, Mr. Lalit Kumar, AOR, Mr. Pankaj Kumar Singh, Adv. And Mr. Raj Singh Rana, AOR JUDGMENT Madan B. Lokur, J . 1. Leave granted. 2. Ease of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 16th May, 1987 to the defendants to carry out their obligations but they failed to do so. 8. Faced with this situation, Rakesh Kumar filed a suit before the High Court being Suit No. 1193 of 1987. As mentioned above, the suit was transferred to the District Courts and renumbered as Suit No.642 of 2001. The prayer in the suit was for specific performance for the agreement to sell dated 29th May, 1986 and for possession of the land in dispute. Along with the plaint, an application was filed by Rakesh Kumar under Order XXXIX of the Code of Civil Procedure for an injunction against alienation of the land in dispute, in which notice was issued to the defendants therein. Rakesh Kumar was granted an interim injunction subject to his depositing the balance sale consideration for restraining the defendants from alienating the land in dispute. It has come on record that Rakesh Kumar did not deposit the balance sale consideration. 9. At this stage, it may be mentioned that during the pendency of the suit, the defendants transferred the land in dispute in 1995 to defendant Nos.5, 6 and 7 and that is why the purchasers were impleaded as defendants in the suit. 10. The parties fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Judge held that Rakesh Kumar did not have the means to pay the balance consideration and was not ready and willing to perform his part of the contract at all times. 13. Feeling aggrieved, Rakesh Kumar preferred a Regular First Appeal before the Delhi High Court. The High Court addressed itself only to the question whether Rakesh Kumar was ready and willing to execute his part of the agreement to sell, at all times. The High Court took the view that rather than Rakesh Kumar, it was the defendants who were not willing to execute the sale deed. The High Court came to this conclusion on the basis of the requirement in terms of the agreement to sell that the defendants were obliged to obtain a no objection certificate for executing the sale deed but they had not taken any steps in that regard. The High Court also relied on the affidavit by way of evidence filed by Rakesh Kumar about his capacity to pay the balance sale consideration. It was also noted by the High Court that the lawyer s notice sent by him on 16th May, 1987 had not been responded to by the defendants. On a consideration of these factors, it was clear that the defendants were not interested in executing the sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cial position to pay the purchase price. For determining his willingness to perform his part of the contract, the conduct has to be properly scrutinised ... The factum of readiness and willingness to perform plaintiff's part of the contract is to be adjudged with reference to the conduct of the party and the attending circumstances. The court may infer from the facts and circumstances whether the plaintiff was ready and was always ready and willing to perform his part of the contract. The facts of this case would amply demonstrate that the petitioner/plaintiff was not ready nor had the capacity to perform his part of the contract as he had no financial capacity to pay the consideration in cash as contracted and intended to bide for the time which disentitles him as time is of the essence of the contract. 20. In I.S. Sikandar (Dead) by Lrs. v. K. Subramani Ors . (2013) 15 SCC 27 this Court noted that the plaintiff is required to prove that from the date of execution of the agreement of sale till the date of the decree, he was always ready and willing to perform his part of the contract. In this case, looking the attendant facts and circumstances, the Court upheld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tificate from the authorities concerned. We have gone through the agreement to sell dated 29th May, 1986 and the relevant clause of the contract is remarkably vague and reads as follows: That the vendors will obtain the no objection certificate from the authorities concerned and will inform the vendee by registered post after getting the income tax clearance certificate. 24. There is nothing to indicate the nature of the no objection certificate that the vendors were required to obtain and who were the authorities from whom the no objection certificate was required, nor is there any indication of the purpose for which the no objection certificate was required. Similarly, there is no indication about the nature of the income tax clearance certificate required and for what purpose. This clause appears to have been inserted in the agreement to sell without any application of mind and it is quite possible, as alleged by the vendors that the agreement to sell was ante-dated after the introduction of Section 260-UC in the Income Tax Act, 1961. However, we need not go into this possibility in view of the vague nature of the clause. 25. On an overall consideration of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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