***

ANIL KSHETARPAL, J. –

1. Brief facts of the case

1.1 With the consent of the learned counsel representing the parties, the following three Regular Second Appeals, arising from a suit, shall stand disposed of by this common judgment:-

1) RSA-106-2021 filed by Joginder Pal Batra and others ,

2) RSA-407-2021 filed by Sh.Harjit Singh through his LRs and

3) RSA-1216-2022 filed by Mandeep Singh Minhas and Rajwant Kaur, son and widow of Kanwarjit Singh.

1.2 In these three appeals, the parties assail the correctness of the judgment passed by the courts below. The trial court in a suit filed for specific performance granted alternative relief of refund of earnest money of Rs.50 lacs alongwith Simple interest at the rate of 9% per annum calculated from the date of filing of the suit till the date of judgment and post judgment interest @ 6% simple interest from the date of judgment till the date of its realization. However, the First Appellate Court, while disposing of as many as two appeals, has modified the trial court’s judgment while granting the relief of recovery of Rs.50 lacs alongwith interest at the rate of 9% per annum from 07.11.1993 till the date of judgment of trial court dated 27.02.2020 and on this accrued amount, the plaintiff shall be entitled to further interest at the rate of 6% simple interest, till its actual realization.

1.3 In this case, the following question requires adjudication:-

“If after the death of Principal, his erstwhile agent for a period of 8 years continues to act and incur obligations to third person on behalf of his Principal and the heirs of the Principal do not take any steps to stop the agent, whether third person can compel the heirs to fulfill the obligations so incurred by the agent?”

1.4 In order to comprehend the issues involved in the present case, some relevant facts, in brief, are required to be noticed.

1.5 Sh.Harjit Singh son of Sh.Kartar Singh was a joint owner to the extent of 30 kanals 8 marlas alongwith other co-sharers in the total land measuring 43 kanals 2 marlas located in the area of Basti Peer Daad, Jalandhar. He appointed his brother Sh.Kanwarjit Singh on 15.12.1983 as his attorney by a registered General Power of Attorney. Sh.Harjit Singh died on 16.10.1991. However, on 15.04.1993 Sh.Kanwarjit Singh without disclosing that Harjit Singh has died, on the basis of attorney dated 15.12.1983, entered into an agreement to sell in favour of Sh.Brij Lal and Sh.Gurcharan Singh. As per the agreement to sell, the land was agreed to be sold at the rate of Rs.16,00,000/- per acre. An amount of Rs.5 lacs was received as the earnest money, whereas Rs.28 lacs was payable in the month of May, 1993. Another amount of Rs.32 lacs was payable in the month of August, 1993, whereas the remaining amount was payable until December, 1993. The plaintiffs allege that upto 07.11.1993 Sh.Kanwarjit Singh was paid Rs.50 lacs and the possession of the land was delivered to them. Thereafter, late Sh.Brij Lal and Sh.Gursharan Singh converted the said land into plots while carving out roads. On 19.10.1995, Sh.Kanwarjit Singh, as attorney of Sh.Harjit Singh, his brother, received another sum of Rs.6 lacs on account of 8 plots bearing no.77, 79 to 85, total measuring 2 kanals 9 marlas. Thereafter, Sh.Kanwarjit Singh executed several sale deeds in respect of various plots carved out on the request of Sh.Brij Lal and Sh.Gursharan Singh in accordance with the agreement to sell on receipt of sale consideration from the vendees, which was retained by the defendants. In the plaint, the details of as many as 25 sale deeds were given. It was reflected in para 6 of the plaint that Sh.Kanwarjit Singh has received a sum of Rs.46,28,500/- while executing the sale deeds. On 26.04.2003, Sh. Brij Lal died while leaving behind plaintiffs no. 1 to 8 i.e his legal heirs. In the meanwhile, Sh.Kanwarjit Singh i.e the attorney of Sh.Harjit Singh also died. The plaintiffs vide notice dated 04.03.2015 requested the defendants to execute the sale deed with respect to the remaining land in accordance with the agreement to sell, however, the defendants failed to execute the sale deeds.

1.6 Consequently, the suit was filed on 28.05.2015. Defendant no.1 (late Sh.Harjit Singh) through his legal representative, filed the written statement. This written statement was filed by Sh.Tejasvi Minhas, attorney of heirs of defendant no.1. It was claimed in the written statement that the agreement to sell dated 15.04.1993, was null and void as the Principal had died on 16.10.1991, and the plaintiffs have hatched a criminal conspiracy to grab the suit property as well as to defraud, deceive, betray and let down the answering defendants. Delivery of possession was also denied. It was claimed that the alleged sale deeds like the alleged agreement to sell are null and void and these sale deeds do not affect the rights of heirs of defendant no.1.

1.7 Defendants no.2 and 3 (legal representatives of Sh.Kanwarjit Singh) did not file any written statement whereas the plaintiff filed the replication. Subsequently, defendant no.2 also filed the written statement contesting the case.

2. Evidence produced by the respective parties:-

2.1 In order to prove their case, the plaintiffs examined PW1 Gursharan Singh, PW2 Des Raj, scribe of the agreement to sell, PW3 Joginder Pal Batra, plaintiff no.1, PW4 Romi, official from the office of Sub Registrar, PW5 Paramjit Singh, Junior Assistant from the office of Sub-Registrar, Jalandhar.

2.2 On the other hand, the defendants, while contesting the case, examined DW1 Ashok Kumar, Patwari, DW2 Simran Kaur, DW3 Harjot Kaur, DW4 Romi, official from the office of the Sub-Registrar, DW5 Mohinder Singh.

3. Reasons recorded by the First Appellate Court :-

3.1 On a careful study of the judgment passed by both the courts below, it becomes evident that the execution of the agreement to sell by Sh.Kanwarjit Singh, on the basis of power of attorney and receipt of Rs.50 lacs has been proved. However, the First Appellate Court has refused to grant the relief of specific performance of agreement to sell on the following reasons:-

(a) Sh.Kanwarjit Singh had no power to execute the agreement to sell on 15.04.1983, particularly when the Principal-Sh.Harjit Singh died on 16.10.1991.

(b) The plaintiffs do not appear to have acted with rationality or due diligence as they were trying to avoid the payment of the stamp duty.

(c)The suit was filed after a long period of 24 years and hence, the plaintiffs are not entitled to the relief of specific performance.

4. Arguments put forth by the learned counsel representing the parties:-

4.1 Heard the learned counsel representing the parties at length and with their able assistance perused the paperbook alongwith the photocopy of the lower court record which has been provided by the learned counsel representing the plaintiffs, the correctness whereof is not disputed.

4.2 The parties were given liberty to file the written arguments as well. Written arguments submitted by the learned counsel representing the plaintiffs are extracted hereunder:-

“1. That as per Ex.P-49 (Power of Attorney) dated 15.12.1983 in favour of Kanwarjit Singh, he was competent to sell the property or to receive the consideration and on the basis of the said GPA, Harjit Singh delivered the actual possession of the property with all other rights to his brother Kanwarjit Singh. That the daughters of Harijit Singh also admitted the execution of the said GPA in their statements. So, from all circumstances it is clear that the execution of the GPA Ex.P-49 is proved.

2. That Kanwarjit Singh further executed agreement to sell dated 15.04.1993 on the basis of the said GPA in favour of the plaintiffs and the plaintiffs developed a colony in the suit land and further 39 sale deeds were executed on the basis of the said Agreement to sell. So, never the agent was disputed nor the GPA.

3. That the Ld. Trial Court at Pg. 50 observed that the plaintiffs had no knowledge of the death of Harijit Singh and the attorney of the Harijit Singh did not inform about the death of Harijit Singh to the plaintiffs and received the money/consideration under the agreement and not only this several sale deeds were also executed by him.

4. That the GPA holder Kanwarjit Singh was the one who executed all the subsequent sale deeds.

5. That only question remains is that the GPA was executed on 15.12.1983 and the agreement was executed on 15.04.1993 and Harijit Singh Died on 16.10.1991 so, what will be the effect of that type of agreement.

6. That as per the statement of the daughters the revenue record was corrected in the year 2016. So, the dispute between the parties arises at that time when the revenue entries were changed.

7. That earlier the suit of specific performance was not filed because there was an understanding between the parties and on result of the said understanding 39 sale deeds were executed and possession was also delivered.

8. That in view of section 208 and 209 of the Contract act, the agency was made by the owner in favour of his real brother, who was not only working as a GPA but also as an ostensible owner of the property. That the agent has already created third party interest over the suit property and also received consideration over it, so, merely the executant of the GPA was expired in the year 1991 will make any difference?

9. The Ld. Courts below has decided the issue merely on the ground of presumption of the facts. But the Ld. Courts below ignored the effect of the sale visa-vis the 3rd party.

10. That the LRs never disputed the GPA and the subsequent sale deeds till the year 2015.”

4.3 The written arguments submitted by the learned counsel representing the legal representatives of Sh.Harjit Singh reads as under:-

“1. PW-1 Gursharan Singh admitted in cross examination that the entire payment was made in cash and no cheque was given in view of entire alleged transaction. Surprisingly, no income tax return or any record of income tax has been proved or produced on record to prove any such transaction. Even it has been admitted by PW-1 in his crossexamination that they were not having balance sale consideration on the date of payment. This fact disentitles them from seeking the relief of specific performance as the main ingredient i.e. readiness and willingness is missing. It was further admitted by this witness that it was agreed between the parties that they will be selling the plot and the income so generated will be paid towards the balance sale consideration but no writing was executed in this regard. Even this witness has categorically admitted that he could not tell the name of the scribe of the agreement to sell. These aspects have not been taken into consideration by both the courts below.

2. PW-2 Des Raj, who is attesting witness of the said agreement to sell, has clearly admitted in his crossexamination that he is not aware about the name of the scribe of the agreement to sell. Further he has also admitted that he did not make any enquiry from the Power of Attorney holder with regard to the status of the original owner as to whether he is dead or alive.

3.PW-3 Romi, who is the official of the Sub -Registrar office, has admitted in his cross-examination that the record produced by him pertains to the sale deed executed as attorney of Kanwarjit Singh but said Kanwarjit Singh was not having any authority to execute further power of attorney. He has further submitted that there is no power of attorney in the official records.

The main issue in the present suit revolves around the law of Limitation. Admittedly the agreement to sell, on the basis of suit for specific performance has been filed, was executed on 31^st May 1993 and the suit has been filed on 28th May 2015 that is about 22 years, which was clearly barred by limitation. The issue being legal issue and having be raised during the course of arguments, both the courts below have not returned any finding on this issue.”

4.4 In RSA-407-2021, the learned counsel representing legal heirs of Sh.Harjit Singh has filed the following synopsis

“1. PW-1 Gursharan Singh admitted in cross examination that the entire payment was made in cash and no cheque was given in view of entire alleged transaction. Surprisingly, no income tax return or any record of income tax has been proved or produced on record to prove any such transaction. Even it has been admitted by PW-1 in his crossexamination that they were not having balance sale consideration on the date of payment. This fact disentitles them from seeking the relief of specific performance as the main ingredient i.e. readiness and willingness is missing. It was further admitted by this witness that it was agreed between the parties that they will be selling the plot and the income so generated will be paid towards the balance sale consideration but no writing was executed in this regard. Even this witness has categorically admitted that he could not tell the name of the scribe of the agreement to sell. These aspects have not been taken into consideration by both the courts below.

2.PW-2 Des Raj, who is attesting witness of the said agreement to sell, has clearly admitted in his cross-examination that he is not aware about the name of the scribe of the agreement to sell. Further he has also admitted that he did not make any enquiry from the Power of Attorney holder with regard to the status of the original owner as to whether he is dead or alive

3. PW-3 Romi, who is the official of the Sub - Registrar office, has admitted in his cross-examination that the record produced by him pertains to the sale deed executed as attorney of Kanwarjit Singh but said Kanwarjit Singh was not having any authority to execute further power of attorney. He has further submitted that there is no power of attorney in the official records.

The main issue in the present suit revolves around the law of Limitation. Admittedly the agreement to sell, on the basis of suit for specific performance has been filed, was executed on 31^st May 1993 and the suit has been filed on 28th May 2015 that is about 22 years, which was clearly barred by limitation. The issue being legal issue and having be raised during the course of arguments, both the courts below have not returned any finding on this issue.”

4.5 Learned counsel representing the legal heirs of Sh.Kanwarjit Singh has filed the following synopsis:-

“1.The appellants and their deceased father were residing in Canada. The plaintiffs very cleverly had given the address of the present appellants as "All residents of 163-R, Model Town, Jalandhar" in the Civil Suit as also before the first appellate Court. Both the appellants-defendant no.2 and 3 were clandestinely and wrongly served through publication at the address at Jalndhra where they were not residing. (page-26 and 68 of the paperbook)

2. The Learned Civil Judge, Jalandhar has noticed that DW2- Simran Kaur 's deposition it has come as follows:

"She also disclosed that she never approached her uncle in Canada and to ask for return of her amount in respect of the suit land. It is also learnt from her cross examination that Kanwarjit Singh and his family is residing in Canada." (page 34 of the paperbook)

Despite this fact having come on record, the Trial Court kept on effecting service to the appellants at 163-R, Model Town, Jalandhar whereas they were never present there.

3. Shri Kanwarjit Singh had died on 13.7.2007 and not on 9.12.2016 as has appeared in para 17 of the judgment passed by the Trial Court. (Page 100- Annexure P-3 is the vernacular of his death certificate. Inadvertently the translation of this document mentions his date of death as 13.07.2003)

4 The present suit was filed on 28.5.2015. Therefore, admittedly when the suit was filed, Shri Kanwarjit Singh had already died and the present appellants were in Canada. (CM-3995-C-2022 in this case for adducing additional evidence to place on record Annexure P-1/2 .P-4 has been filed. Annexure P-4 is the confirmation of permanent residency of appellant no.1 which mentions origin entry date as 06.04.2012. The appellant no.2 being the mother of appellant no 1 accompanied him to Canada.)

Therefore, the action of the Trial Court to get the service of the appellants effected through publication in news-papers published in India and to proceed against the present appellants ex-parte is enough to vitiate and set aside the entire proceedings against the present appellants.

5. That the plaintiffs during the entire suit proceedings and later before the first appellate Court never disclosed that the appellants were living in Canada and not at Jalandhar. Suddenly, in this Hon'ble Court, in order to get the service of the appellants effected in RSA No. 106 of 2021 titled Joginder Pal Batra & Another Vs. Harjit Singh & Others, the plaintiffs got the service of the appellants effected at their address at Canada. The summons received by the appellants on 15.1.2022 at Canada is attached herewith as Annexure P-1 (adduced through an application for adducing additional evidence - page B to E of this apperbook). Therefore, it is clear that the plaintiffs have clearly played a fraud with the Courts as also with the appellants.

6. The appellants were not given any opportunity to represent their version before both the Courts below. There is no explanation with the plaintiffs that how in the RSA preferred by them i.e. RSA NO. 106 of 2021. they suddenly discovered the address of the appellants in Canada. Therefore, this was a deliberate act of the plaintiffs to play a fraud upon the appellants as also a fraud upon the Courts below.

7. Both the Courts below have miserably failed to notice the fact that PW-1 Gursharan Singh had admitted to the fact that the consideration mentioned in the agreement to sell was never paid through cheque and the entire amount was paid in cash. This witness admits to the fact that the plaintiffs did not have the remaining consideration. The trial Court has specifically returned a finding that the plaintiffs were not entitled to a suit for specific performance and without any material having come on record which could possibly establish that the deceased father of the appellant no.1 had received the amount of Rs. 50 lakhs, the suit was decreed in the alternative. The Courts below failed to notice a vital aspect that the onus of proof rested with the plaintiffs to establish from where had they arranged Rs. 50 lakhs. It is vehemently denied that Late Shri Kanwarjit Singh ever executed any agreement dated 15.4.1993 or was paid Rs. 50 lakhs ever. The Courts have erred in law to examine and deliberate this very basis of the case and the judgments are liable to be discarded on this ground alone.

8. Suit was barred by limitation

Both the Courts have grossly erred in not noticing the fact that specific performance of an agreement dated 15.04.1993 was sought vide a suit instituted on 28.05.2015. The suit was clearly barred by limitation. A visit upon the agreement to sell dated 15.04.1993 is very crucial at this stage. A copy of the same is already on Trial Court record as Exhibit P-1.Though the agreement does not bear the signatures of Late Shri Kanwarjit Singh the father of the appellant no.1, a recital of the said agreement shows that the remaining sale consideration had to be paid upto December,1993 before the Sub-Registerar, Jalandhar. Therefore, time was the essence of the agreement. The finding of the trial Court in para number 33 of the said judgment that the time was never an essence of the contract is wholly perverse, illegal and contrary to law.”

5. Analysis of the reasons recorded by the First Appellate Court :-

5.1 At this stage, this Bench proceeds to examine and analyse the reasons recorded by the First Appellate Court:-

1.Reason no.(a) (Para 3.1 point (a):

1.1 The First Appellate Court’s reason no.(a) is result of failure to deeply examine the entire facts. Sh.Harjit Singh and Sh.Kanwarjit Singh were two brothers. Sh.Harjit Singh was residing in England. He appointed his brother Sh.Kanwarjit Singh as attorney on 15.10.1983. In the said attorney, Sh.Kanwarjit Singh was also authorized to sell, transfer or lease the property. As per the evidence of DW1 Patwari, Sh.Harjit Singh was owner of 30 kanals 8 marlas land out of land measuring 43 kanals 2 marlas. Despite the death of the Principal Sh.Harjit Singh, Sh.Kanwarjit Singh entered into an agreement to sell in favour of Sh.Brij Lal and Sh.Gursharan Singh on 15.04.1993 without disclosing about his brother’s death.

1.2 From the reading of testimony of Dr. Simran Kaur and Smt. Harjot Kaur who are daughters of late Sh.Harjit Singh, it becomes evident that after Sh.Harjit Singh authorized his brother Sh.Kanwarjit Singh as attorney, the family of Sh.Harjit Singh lost interest in the property. Smt.Harjot Kaur admits that her mother is living in Delhi since 2000. Her mother visited Jalandhar several times after coming from England. She was aware that a colony has been developed in the suit land. She admits that her uncle sold the suit land in accordance with the power of attorney executed by her father in the year 1983. She further admits that more than 35 sale deeds have been executed by her uncle in the capacity of attorney of her father. She attended the marriage of her uncle’s daughter in the year 2007 at Model Town, Jalandhar. She admits that she started residing in Delhi in the year 2004. She also admits that they have good relations with the family of her uncle and they never demanded the amount of sale from their uncle.

1.3. Similarly, Dr. Simran Kaur has admitted in her cross-examination that they had good relationship with the family of her uncle. After the death of Sh.Harjit Singh the family got mutation of the property sanctioned only in the year 2016. She also admitted that she was aware about the development of a colony in the suit land and that she never inquired from any person in order to know in what capacity the property owned by her father is being occupied. She admitted that her mother visited Jalandhar in the year 1998 and they have never approached their uncle to return the amount received by him in respect of their land. She also admitted that Sh.Kanwarjit Singh as an attorney appointed by her father, executed more than 35 sale deeds.

1.4 On analysis of the aforesaid evidence, it is evident that the successors in interest of Sh.Harjit Singh have neither disputed the agreement to sell nor the power of attorney nor execution of more than 35 sale deeds. It is the positive case of the plaintiffs that at the relevant time they were not aware about the death of late Sh.Harjit Singh. In this regard, it may be noted that by executing a general power of attorney, the Principal i.e Sh.Harjit Singh appointed an agent who was his brother i.e Sh.Kanwarjit Singh.

1.5 The relationship of the parties involved in this case i.e principal, agent and third parties would be governed by Chapter X of the Indian Contract Act, 1872 (hereinafter referred to as ‘1872 Act’). As per Section 209 of the ‘1872 Act’ if the Principal dies or becomes of unsound mind, the agency is terminated. However, Section 208 of the ‘1872 Act’ provides that the termination of agent’s authority will take effect as regards third person when this fact becomes known to them. Section 237 protects the interest of third party in certain eventualities. At this stage, it would be appropriate to extract Section 237 of the ‘1872 Act’, which reads as under:-

“237. Liability of principal inducing belief that agent's unauthorized acts were authorized.—When an agent has, without authority, done acts or incurred obligations to third persons on behalf of his principal, the principal is bound by such acts or obligations, if he has by his words or conduct induced such third persons to believe that such acts and obligations were within the scope of the agent's authority.”

1.6 It is evident that if an agent without authority of the principal has done acts or incurred obligations to third persons on behalf of the Principal, the Principal is bound by such acts or obligations, if he has by his conduct or words induced such third persons to believe that such acts and obligations were within the scope of the agent’s authority. In fact, Section 237 of the ‘1872 Act’ protects the third persons who are induced or misled by the agent and the principal to enter into a transaction where the agent has no express/implied authority.

1.7 The principle enshrined in Section 237 has its origin from Section 41 of the Transfer of Property Act, 1882 (hereinafter referred to as ‘1882 Act’) which protects a third person from transfer of property by an ostensible owner. Section 41 of the ‘1882 Act’ is extracted as under:-

“41. Transfer by ostensible owner.— Where, with the consent, express or implied, of the persons interested in immoveable property, a person is the ostensible owner of such property and transfers the same for consideration, the transfer shall not be voidable on the ground that the transferor was not authorised to make it: provided that the transferee, after taking reasonable care to ascertain that the transferor had power to make the transfer, has acted in good faith.”

1.8 If Section 237 of the ‘1872 Act’ is dissected, the following ingredients emerge:-

i) It discusses about the relationship of Principal and Agent;

ii) It comes to effect if the agent has acted without the authority of the Principal or has incurred obligation to third person on behalf of the Principal;

iii) If the Principal by his words or conduct induces such third person to believe that such acts and obligations were within the scope of agent’s authority.

1.9 If all the three ingredients as discussed above are fulfilled, the Principal is bound by the unauthorized acts or obligations incurred by the agent. If the aforementioned tests are applied to the facts of the matter at hand, it is evident that there was relationship of Principal and agent between Sh. Harjit Singh and Sh.Kanwarjit Singh. Sh.Harjit Singh appointed Sh.Kanwarjit Singh as his agent by executing a General Power of Attorney. After the death of Sh.Harjit Singh, the authority conferred upon Sh.Kanwarjit Singh ceased to exist as per Section 209 of the ‘1872 Act’. However, heirs of Sh.Harjit Singh never claimed any right in the property. They never gave any public notice informing that Sh.Harjit Singh has died and Sh.Kanwarjit Singh has no authority to incur obligations to third persons on behalf of Sh.Harjit Singh. They did not take any steps to stop Sh.Kanwarjit Singh from incurring obligation on behalf of their father. Rather it is proved that they never asserted any authority or claimed the property despite the fact that they knew that a colony is being developed on the property in dispute and Sh.Kanwarjit Singh continued to incur obligations to third persons. From the reading of the depositions of both the daughters of Sh. Harjit Singh, it becomes evident that they always assumed that the authorization in favour of Sh.Kanwarjit Singh continued to exist even after Sh.Harjit Singh’s death. The relationship between the heirs of Sh.Harjit Singh and Sh.Kanwarjit Singh continued to be normal. It is also evident that the heirs of Sh.Harjit Singh assumed that the property has already been sold. Thus, in this case, all the ingredients of Section 237 of ‘1872 Act’ stand fulfilled.

1.10 In the facts of the present case, Section 237 of the ‘1872 Act’ read with Section 41 of ‘1882 Act’ comes to the rescue of the plaintiffs. The purpose of incorporating these provisions in both the Acts is primarily to protect the bonafide purchasers/third persons who have no information about the unauthorized acts of agent on behalf of the Principal because act/conduct of the principal represents that the agent is authorized. In substance, these provisions are based on the rule of estoppel which shall be applicable to the facts of the present case.

1.11 The Principal Harjit Singh died on 16.10.1991. The heirs by their conduct continued to imply that the agency continued to exist. During all this while the heirs never expressly or impliedly showed that the agency created in favour of Sh.Kanwarjit Singh has come to an end. Hence, the heirs of deceased principal. Sh.Harjit Singh have attorned in the favour of the agent, by implying that the agency continued. The legal heirs of Sh.Harjit Singh continued to interact with their uncle in a manner consistent with the ongoing agency. Their conduct never indicated clarity with regard to the termination of agency. This lack of express or implied indication from the heirs of Sh.Harjit Singh meant that the authority given to Sh.Kanwarjit Singh remained intact throughout.

1.12 The evidence of both the daughters of Sh.Harjit Singh proves that all the sale deeds were executed either with their implied consent or they decided to ignore such execution of the agreement to sell and various sale deeds by Sh.Kanwarjit Singh their uncle. They have not even once demanded the amount of the sale consideration from the family of their uncle. In such circumstances, the plaintiffs cannot be penalized for the malafide acts of the agent. It is not proved that the plaintiffs were in the knowledge of the fact that Sh.Harjit Singh had died on 16.10.1991. In fact, Sh.Kanwarjit Singh, while executing a special power of attorney on 30.10.1995, has declared that Sh.Harjit Singh is alive. In these circumstances, the courts have erred in declaring that the agreement to sell was not binding upon the heirs of Sh.Harjit Singh. Hence, reason no.(a) assigned by the First Appellate Court is erroneous and based on little facts.

2. Reason no.(b) Para 3.1 point (b):

2.1 The First Appellate Court’s reason no.(b) is correct to a limited extent, however, the court cannot overlook that failure on the part of the plaintiffs to get the sale deeds executed in their favour on the basis of the agreement to sell would not debar them from seeking specific performance of agreement to sell of the remaining part of the property. It has come on record that Sh.Kanwarjit Singh has already executed the sale deed of 80422.34 sq. feet whereas the remaining saleable area is 1,30,292.21 sq. feets while leaving the area which has come under the road measuring 28727.45 square feet. The First Appellate Court has erred in observing that the plaintiffs have attempted to violate the law by trying to avoid the payment of stamp duty.

3. Reason no.(c ) para 3.1 point (c )

3.1 Similarly, reason no.(c) assigned by First Appellate Court also lacks substance. It may be noted here that as per the agreement to sell, the remaining payment was payable upto December, 1993 and thereafter, the plaintiffs were at liberty to get the sale deeds executed at any point in time. As per Article 54 of the Schedule attached to the Limitation Act, 1963 the time from which the period begins to run has been divided into two parts. In the first part, the time to file the suit begins to run from the date fixed for performance. The limitation for filing such suit is 3 years from the date fixed for performance. If no such date is fixed, the time to file the suit would begin to run when the plaintiff notices that the performance is refused. It is not the case of the defendants that they have sent a notice to the plaintiffs refusing to perform their part of contract, more than 3 years before the date of filing of the suit i.e 28.05.2015. Hence, the First Appellate Court has erred in observing that the suit was filed after a period of 24 years and therefore, they are not entitled to specific performance.

6. Analysis of the submissions of the learned counsel representing the parties:-

6.1 The first submission of the learned counsel representing two daughters of Sh.Harjit Singh lacks substance because the receipt of Rs.50 lacs is acknowledged by late Sh.Kanwarjit Singh in the receipt dated 07.11.1993. The plaintiffs have also produced receipt dated 31.05.1993 evidencing payment of Rs.15 lacs. Thereafter, receipt of another sum of Rs.6 lacs is acknowledged by the agreement signed by Sh.Kanwarjit Singh with respect to land measuring 2 kanals 9 marlas which is a part of 43 kanals 2 marlas. Pursuant thereto, Sh.Kanwarjit Singh also executed a special power of attorney on 30.10.1995, in favour of Sh.Brij Lal authorizing him to sell the land measuring 1242 sq. feet.

6.2 Furthermore, the plaintiffs, while filing the suit, in para 6 of the plaint, have specifically asserted that Sh.Kanwarjit Singh also received payments from various vendees. The total amount alleged to have been paid under the aforesaid sale deed is Rs.46,28,500/-. The defendant no.1, while filing the written statement, has alleged that the sale deeds are null and void. However, there is no specific denial to the assertion that the payments were made to the agent i.e Sh.Kanwarjit Singh. According to Order VIII Rule 6 of the Code of Civil Procedure, 1908, in the absence of specific denial, the pleadings are deemed to have been admitted. Moreover, two daughters of Sh.Harjit Singh, while appearing in evidence, have not disputed the payment. Sh.Kanwarjit Singh’s children have not stepped into the witness box. In these circumstances, it will not be appropriate to hold that the plaintiffs have failed to prove the payment of the entire sale consideration.

6.3 The second argument of the learned counsel is required to be examined in the facts of the present case. In this case, execution of the agreement to sell by Sh.Kanwarjit Singh as attorney of Sh.Harjit Singh is not in dispute, particularly when execution of the 35 sale deeds pursuant to the agreement to sell have been admitted. In that context, the deposition of Sh.Des Raj, the scribe, is required to be examined. Sh. Des Raj appeared in evidence in the year 2019, whereas the agreement to sell was entered into on 15.04.1993. He has been examined after a long period of 26 years and memories tend to fade away with time. Hence, the second argument put forth by the learned counsel lacks substance.

6.4 The last argument of the learned counsel representing the legal representative of Sh.Harjit Singh also holds no firm ground because it is for the court to decide whether the sale deeds executed by Sh.Kanwarjit Singh were valid or not. The issue of limitation has already been examined by this Court in Para 5.1, Point no.3 and needs no further deliberation.

6.5 As far as the argument of the learned counsel representing the legal representative of Sh.Kanwarjit Singh is concerned, it may be noted that the plaintiffs, while filing the suit, have disclosed their address as 163 R Model Town, Jalandhar. It may be noted here that it is nowhere proved that the plaintiffs were in the knowledge of the fact that they are heirs of Sh.Kanwarjit Singh, residing in Canada. While impleading defendant no.1 Sh.Harjit Singh through his LRs, the plaintiffs have disclosed the address of England. Hence, the argument lacks substance.

6.6 The argument no.2 also lacks substance for the similar reasons.

6.7 Submission no. 3 of the learned counsel is factual and needs no further deliberation.

6.8 Argument no.4 put forth by the learned counsel also does not need deliberation because this point was never taken before the courts below. In any case, the defendant no.2 filed the written statement and there is no evidence that the plaintiffs have intentionally given incorrect address of the defendants no.2 and 3.

6.9 The argument no.5 also lacks substance because defendant no.2, after having entered appearance, never got his address corrected in the memo of parties. Moreover, before the First Appellate Court, defendants no.2 never filed an application for amending the memo of parties. Legal representative of defendant no.1 also filed appeal in which defendants no.1 and 2 namely heirs of their uncle were reflected to be residents of 163-R, Model Town, Jalandhar. Hence, their is no material on record to prove that the plaintiffs have played fraud with the court

6.10 The argument no.6 put forth by the learned counsel is factually incorrect. From a perusal of the judgment of the trial court, it is evident that defendant no.2 filed an independent written statement. Subsequently, defendant no.2 and 3 were proceeded against ex-parte as they chose not to continue contesting the case after having filed the written statement. In such circumstances, submission no.6 of the learned counsel is erroneous.

6.11 As regards submission no.7, the same is identical to submission no.1 of learned counsel representing defendant no.1, which has already been analysed by this Court.

6.12 The last submission of the learned counsel is with regard to limitation which has also been analysed while examining the reasons given by the First Appellate Court in Para 5.1

7. Discussion by this Court:-

7.1 The colony has already been carved out on the disputed property. If the relief of specific performance of the agreement to sell is not granted, the plaintiffs would not take interest in completing the colony in which a significant number of plots have been sold. On the other hand, if specific performance of the agreement to sell is granted chances are that the plaintiffs would complete the colony by providing all the requisite facilities to the residents/ plot buyers.

7.2 As the heirs of Sh.Harjit Singh i.e the principal are settled in England and for the last 25 years, they have never bothered to take care of their property after their father passed away in the year 1991, hence, no equity lies in their favour. In fact, from the testimony of both the daughters of Sh.Harjit Singh, it is evident that but for the intervention of their cousin, they always treated agreement to sell to be the complete sale of the suit property.

7.3 As a significantly large number of sale deeds have already been executed, the agreement to sell has been partially honoured by the defendants.

7.4 The plaintiffs are not guilty of committing any default which may disentitle them the relief of specific performance of the agreement to sell as they being third parties unaware of the death of principal were bonafide purchasers.

8. Decision:-

8.1 Keeping in view the aforesaid discussion, the result is inevitable. RSA no.106-2021 filed by Joginder Pal Batra shall stand allowed and the judgments passed by the courts below are modified by granting relief of specific performance of the agreement to sell with respect to the land measuring 1590.78 sq. feet without any further payment, as prayed for by the plaintiffs whereas RSA-407 and 1216 of 2022 filed by Sh.Harjit Singh through LR’s and Mandeep Minhas and another, respectively, shall stand dismissed.

8.2 All the pending miscellaneous applications, if any, are also disposed of.

Appeal dismissed.

********