2009 PLP 2359 (YLR)

FAISAL ARAB, J.

This appeal arises from the proceedings, which were initiated by the respondents against the appellant seeking specific performance of Contract entered into on 10-3-2005. The clauses of the agreement, relevant for the purposes of resolving the controversy, are reproduced as under:- "

2. That the Remaining balance of Rs.27,00,000 (Rupees twenty seven lacs only) shall be paid by the vendee to the vendor at the time of execution of G. Power/S. Power of Attorney/Sale-deed/transfer from concerned authorities/society/KDA in favour of vendee or his/her nominee, within 20 days, from the date of these presents at which time the vendor will hand over the vacant peaceful possession with all the documents in original of the said property to the Vendee.

6. That this agreement is irrevocable and the time prescribed above for completion of the transaction is the essence of this agreement.

8. That this agreement's time will be extended by the Vendee for the payment of said property." The case of the appellant is that under clause (2) twenty days were provided for making the payment, which the respondents failed to comply and, therefore, the appellant treated the agreement as cancelled. The case of the respondent No.1, on the other hand, is that clause 8 of the Agreement entitled him to extend the time for the payment, which clause even nullified the effect of clause (6) that made time the essence of the contract, hence non-payment of the balance sale consideration within the stipulated time as mentioned in clause (2) did not disentitle the appellant from seeking specific performance of the contract. It is an admitted position that after execution of the agreement a further part payment of Rs.50,000 was made by the respondent No. 1 to the appellant on 12-3-2005, which was accepted without any objection by the appellant. It is also an admitted position that no issue was framed on the question whether time was the essence of the contract. Keeping in view the fact that no such issue was framed, the trial Court interpreted clause (2) and came to the conclusion that since stipulated period had expired and only after expiry of such period the respondent No.1 has sought specific performance, he became disentitled for the same. In the First Appeal that was preferred by the respondent No.1, the findings of the trial Court were reversed on the ground that since clause (8) of the agreement entitled the respondent No.1 to extend the time, the agreement could not have been put to an end upon the expiry of the stipulated period of 20 days and delay was of no legal consequence. The appellant has challenged the findings of the 1st Appellate Court in this IInd Appeal. Learned counsel for the appellant has contended that as the trial Court has given its decision on the basis of the legal effect of clause (2) only the appellate Court ought not have examined clause (8) of the agreement which provided for extension in the period for the performance of the contract. It is an established principle that where time is provided for the performance of a contact in relation to immovable property, it is not to be regarded as essence of the contract unless the parties with mutual consent make time as essence of the contract. It is also a legal principle that where the parties make time as essence of the contract, but from the conduct of the parties or other stipulation of the agreement it become evident that time is not meant to be made essence of the contract, it is not to be regarded as time was the essence of the contract. In the present case though in clause (6), it is clearly specified that the time is the essence of the contract, the appellant by incorporating clause (8) as well in the agreement which provides that time can be extended by the respondent No.1, nullified the effect of clause (6), therefore, in presence of clause (8), time cannot be regarded to have been made essence of the contract. This brings the Court to the first argument of the learned counsel for the appellant that the effect of clause (2) only ought to have been examined by the appellate Court and as it provides 20 days only and the respondent No.1 ought to have come forward within this period and sought specific performance of the contract. This question stands answered in the case reported in PLD 1962 SC 1 where the Honourable Supreme Court clearly stated that when agreement is in relation to immovable property, the expiry of the time for the performance does not agreement to an end. The seller is required to serve a notice of at least 30 days to the purchaser calling upon him to complete the transaction and after service of such notice if the purchaser fails to come forward and complete the transaction within 30 days period only then the contract for specific performance comes to an end and the purchaser becomes disentitled to seek specific performance. In the present case admittedly no such notice was issued by the appellant. Therefore, the respondent No.1 was fully entitled to seek specific performance of the contract. In the present case the respondent No.1 has promptly come before the Court i.e. in July, 2005 within three months seeking specific performance of the agreement. I am, there-fore, of the view that the findings of the appellate Court do not suffer from any legal infirmity or are contrary to any principle, which regulate specific performance of the contracts. Hence there is no occasion to interfere in the impugned judgment. Resultantly this appeal is dismissed in limine along with listed application. H B. T. /N-32/K Appeal dismissed.