P L D 1962 Supreme Court 1 (PLP)

CORNELIUS, C. J.

I agree with the judgment delivered by nay learned brother S. A. Rahman, J. to which I have nothing to add. S. A. RAHMAN, J.

This appeal, by special leave, arises out of a suit brought by Abdul Hamid, the appellant before us, in the Chief Court of Sind, on the original side, for specific performance of a sale of land, or, in the alternative, for damages in lieu thereof. The suit was dismissed by a learned Single Judge of that Court on the 5th September 1955. The plaintiff appealed but the order was confirmed by a Division Bench of the High Court of West Pakistan, Karachi Bench, the successor Court to the Sind Chief Court, on the 20th of November 1958. The High Court declined to grant a certificate for leave to appeal to this Court. The plaintiff then approached this Court with a petition for special leave to appeal which was dismissed summarily on the 19th October 1959. A review of that order was granted on the plea that the petition for special leave was directed not merely against the appellate judgment of the High Court but also the order, refusing to grant a certificate for leave to appeal to this Court, in respect of which nothing had been said in the earlier order of this Court. It was urged that the plaintiff was entitled as of right to the grant of a certificate for leave to appeal by the High Court as the value of the subject-matter exceeded Rs. 15,000 and the case fell within Article 158 of the late Constitution. Leave to appeal was, there fore, granted. The relevant facts may be briefly summarised. The plaintiff appellant contracted with the respondent for the purchase of a plot of land with the structures thereon, for a consideration of Rs. 16,750, on the 20th of January 1949. Two agreements were executed inter partes on that date, though they purport to have been made on the 7th day of January 1949. Under the first agreement, Rs. 2,000 was paid, by way of earnest money, to the vendor and it was agreed that the balance of the purchase-money would be paid by the vendee within two months from the date of the agreement "on the Vendor obtaining certificate from the Income-tax Authorities under the Transfer of Property (Pakistan) Ordinance, 1947, certificate from the Rent Controller and making out clear, valid, subsisting and marketable title to the premises hereby agreed to be sold, free from all claims, liens, charges and incumbrances whatsoever, executing the necessary Sale Deed in favour of the Vendee or any one else at his instance, getting the same registered, getting necessary mutation of name effected and putting the Vendee or his nominee in possession of the said premises". It was further stipulated that "in case of any delay occurring in obtaining the requisite certificate for reasons beyond the control of the Vendor, the Vendee shall not claim any damages etc. from the Vendor for such delay nor will such delay affect this transaction in any manner which shall remain intact and in full force." By the second agreement, it was provided that the Vendee would pay to the Vendor, a further amount of Its. 4,750, out of the agreed sale-price, within one week, and in case he was unable to pay the balance of Rs. 10,000 out of the sale-price within a period of two months, the vendor would grant him extension of time up to 18 months from the date of the agreement. Within this period, the vendee was to be entitled at any time to pay the balance of Rs. 10,000 and obtain conveyance of the property. The vendee was to be put in possession of the property. He was then to be at liberty to make any alterations or additions of a temporary nature, in the premises, in conformity with the rules and regulations of the Government and the Muni cipal Corporation. In addition, the vendee was to pay to the vendor Rs. 50 p.m. as "rent" from the date of the expiry of the said period of two months, till he obtained conveyance of the property. The vendor on his part bound himself to obtain a "Sanad" of the property and to deliver it to the vendee at the time of the completion of the sale. In default of doing so, he was to pay a sum of Rs. 15 only to the vendee. The plaintiff was put in possession of the property in pursuance of these agreements on the 20th of November 1949. It was a part of the plaintiff's case that he had effected improvements in the structures standing on the land, at a cost of Rs. 10,000, though in the evidence, this figure was sought to be enhanced to Rs. 23,

000. The suit was grounded mainly on the allegation that the plaintiff-appellant was ready and willing to perform his part of the contract by paying the balance of the purchase-money, on the defendant producing the clearance certificate from the Income-tax Department and a no-objection certificate from the Custodian of Evacuee Property. It was averred that the defendant had failed to produce these documents on the plaintiff's demand. He, therefore, prayed for specific performance of the contract of sale and, in the alternative, asked for refund of Rs. 6,750 paid by him, together with the cost of improvements effected in the structures, valued at Rs. 10,000, with interest on these two sums and claimed Rs. 25,853-8-0 by way of damages for breach of contract. The suit was contested by the defendant on the ground that the plaintiff had himself been in breach and that the defendant had, therefore, rescinded the contract on the 18th September 1950 on plaintiff's failure to complete the transaction within ten days of the receipt of a notice sent to him on the 4th September 1950, making the time fixed as of the essence of the contract. It was also pleaded that the plaintiff had not paid the rent due to the defendant under the agreement and that no compensation was payable for the alleged improvements to the structures as the improvements permissible under the agreement were of a temporary character. The following issues were settled between the parties by the learned single Judge of the Sind Chief Court :- (1) Was the plaintiff ready and willing to fulfil his part of the contract ? (2) On whose part is the breach of the contract and when did it take place ? (3) To what decree, if any, is the plaintiff entitled ? (4) General with special reference to costs. It was found by the learned Judge that the plaintiff was not ready and willing to fulfil his part of the contract and that in fact he had been guilty of breach of contract. The plaintiff was held to be disentitled to any relief and the suit was dismissed. The Division Bench of the High Court, in appeal, affirmed the finding of the Court of first instance that the plaintiff had no intention of getting his sale-deed registered as he was not ready and willing to fulfil his part of the contract. The plaintiff, it appears, had demanded copies of the Income-tax certificate and the Custodian's no-objection certificate from the defendant, but it was found that he was not entitled to call for such copies as the documents in question were not documents of title within the meaning of section 55 of the Transfer of Property Act. On the 4th of September 1950, the defendant had notified the plaintiff that he had obtained these documents from the relevant authorities. He gave him ten days to complete the transaction. It was contended before the learned Judges in the High Court that the defendant could not have by his unilateral act fixed a definite time-limit for the performance of the contract, time being not of the essence of the contract. This contention was countered by a finding to the effect that there had been undue delay in the performance of the contract on the part of the plaintiff whose financial position was weak and that the circumstances justified the fixing of a definite point of time" beyond which performance of the contract should not have been postponed. It was found that reasonable notice to the plaintiff had been given for completion of the sale-deed and it was he who was in breach. Consequently, the appeal was dismissed. The question that falls for determination is whether the High Court was guided in its approach to correct legal principles in the circumstances of this case. From the facts on the record it is clear that the period of two months fixed by the agreement inter parses for payment of the purchase-price, ended on the 7th of March 1949, if the date of the agreement is regarded as the 7th January 1949 and the 20th of March, if the date of actual execution of the agreement is to be the starting point. The payment of the purchase-money, howeve4, was contingent on the condition that the vendor in the meantime obtained the necessary certificates from the Income-tax and other authorities to enable registration to take place. The second agreement, entered contemporaneously between the parties, contemplated plainly an extension of this period of two months to 18 months in case the vendee was unable to produce the sale-price within the shorter period. The inference seems obvious that the time fixed was not of the essence of the contract originally. Posses sion had already passed to the vendee. This conclusion is fortified by a consideration of the fact that the matter does not appear to have been treated as one of urgency and the vendor did not obtain the certificates from the Income-tax Department and the Custodian of Evacuee Property till the 31st of August and the 1st of September 1950, respectively, although even the 18 months' period, mentioned in the second agreement, had expired long before. Somewhat unreasonably, the vendor began sending communications to the vendee before he had armed himself with these certificates, calling upon the vendee to com plete the transaction, and even made suggestions that the financial position of the vendor probably stood In the way of his carrying out the contract. The vendee, on the contrary, was all the time insisting that the vendor should first perform his part of the contract and obtain the necessary certificates whose production was a condition precedent to the registration of the sale-deed and in this he was clearly and plainly right. For the first time, on the 4th September 1950, the defendant-vendor intimated to the appellant the fact that he had obtained those certificates. That then is the relevant date with reference to which the conduct of the parties has to be judged in respect of their willing ness or otherwise of proceeding with the contract. The previous correspondence exchanged between the parties could be of no avail l in this behalf. Reference in this connection may be made to Crawford v. Toogood (13 Ch. D. 153). In Jamshed Khodaram Irani v. Burjorji Dhunjibhal (43 I A 26), the Judicial Committee of the Privy Council had occasion to observe that "section 55 of the Indian Contract Act, 1872, does not lay down any principle which differs from the law of England as to contracts for the sale of land. Specific performance of a contract of that nature will be granted although there has been a failure to keep the dates assigned by it, if justice can be done between the parties and if nothing in (a) the express stipulation of the parties, (b) the surrounding circumstances, make it inequit able to grant relief. An intention to make time of the essence of the contract must be expressed in unmistak able language; it may be inferred from what passed between the parties before, but not after, the contract is made. It was also laid down in that case that "equity will not assist where there has been undue delay on the part of one party to the contract, and the other has given him reasonable notice that he must complete within a definite time." The principle, that if time is not originally made of the essence of a contract for sale of land, one of the parties is not entitled afterwards, by notice, to make it of the essence, unless there has been some default or unreasonable delay by the other party, was laid down as long ago as 1879 by Fry J. in Green v. Sevin (13 Ch. D. 589). That principle was re-affirmed in Smith v. Hamilton and another ((1951) 1 Ch. D 174). The following extract from Fry J's judgment in Green v. Sevin was, inter alia, cited with approval by Harman, J. in the last-named case:-- "What right then had one party to limit a particular time within which an act was to be done by the other ? It appears to me that he had no right so to do, unless there had been such delay on the part of the other contracting party as to render it fair that, if steps were not immediately taken to complete, the person giving the notice should be relieved from his contract. It has been argued that there is a right in either party to a contract by notice so to engraft time as to make it of the essence of the contract where it has not originally been of the essence, independently of delay on the part of him to whom the: notice is given. In my view there is no such right. It is plain upon principle, as it appears to me, that there can be no such right. That which is not of the essence of the original contract is not to be made so by the volition of one of the parties, unless the other has done something which gives a right to the other to make it so. You cannot make a new contract at the will of one of the contracting parties. There must have been such improper conduct on the part of the other as to justify the rescission of the contract sub modo, that is, if a reasonable notice be not complied with. That this is the law appears to me abundantly plain." This proposition has received the support of standard text books on the subject-See Fry on Specific Performance Para. 1092, 6th Edition, and Cheshire & Fifoot on Contracts, page 450, 5th Edition. The question then arises: Was the purported rescission of the contract by the defendant-respondent based on any improper conduct on the part of the appellant, prior to the 4th of September 1950 when he attempted to fix a period of ten days for performance ? The answer must clearly be in the negative. Till then, the vendor was not in a position to say that he had completed his own part of the contract and, consequently, he could not have charged the plaintiff-appellant with laches or dilatoriness in offering to perform. The appellant was perfectly within his right in insisting before that date that he could not be called upon to pay the purchase-price till the respondent had armed himself with the necessary certificates without which registration was not possible. The suggestion that prior to that date the appellant was in financial difficulties, may well be true, but this would be an irrelevant consideration. It was within the bounds of possibility that the appellant could raise money by a loan as and when the matter ripened to a stage where execution of the contract and its registration became possible. That aspect of the case was lost sight of in the High Court. The finding, therefore, that the appellant was guilty of some improper conduct or delay before the notice was given by the vendor on the 4th of September 1950, cannot be sustained. It follows that the vendor at this stage was not entitled unilaterally to fix the time of ten days for the performance of the contract, as he purported to do. The delay, if any, in the carrying into effect of the contract had been due to his own conduct. This finding, to my mind, would be sufficient to dispose of the appeal. I am further of the view that the ten days' notice given by the respondent for completion at the above-mentioned stage of the negotiations between the parties was unreasonable in the circumstances of the case. It must be remembered that possession had already passed to the vendee in this case and that the latter had parted with not only the earnest money of Rs. 2,000 but also a considerable portion of the purchase-price fn favour of the vendor at an earlier date. The equities were all in favour of the vendee rather than the vendor. The mere; fact, that the vendee in his reply to the noticed of the 4th September which he sent on the 16th of September, somewhat foolishly, made a demand that the vendor should clear off the huts and cows etc. in front of the site fn question and that the vendor should supply hi-n with copies of the two certificates, obtained by the vendor, does not really affect the question, as even before the receipt of this reply, the vendor had by a notice, dated the 18th September 1950, rescinded the contract. It may be conceded that the two certificates, being not documents of title, under section 55 of the Transfer of Property Act, there was no right in the plaintiff-appellant to insist on examination of those documents. All he had to satisfy himself about was that they had been obtained. If the vendor had waited for the vendee's reply, and then taken up the attitude that the vendee was trying to engraft new conditions on the contract, perhaps the position might have been different. As it is, however, It was not open to the respondent to rescind the contract when he did. This appeal, consequently, must be allowed and the orders passed by the Courts below set aside. The appellant is clearly entitled to specific performance of his contract. It may, however, be necessary for some accounting to take place between the parties, before a formal decree is drawn up. I understand that the appellant is liable to pay a certain amount of rent to the vendor, and unless this question is first settled, it would be difficult to lay down precisely the exact amount on payment of which specific performance should take place. For this purpose, a period of two months may be allowed to the parties, so that the necessary accounts may be settled. This period can also be utilized by the parties for satisfaction on any questions of title to the land that may require clarification. FAZLE-AKBAR, J.

This is an appeal by special leave from the judgment of the High Court of West Pakistan affirming the judgment of Muhammad Bakhsh, J. who had dismissed an action for specific performance. The facts are shortly these. The defendant Abbas Bhai-Abdul Hussain Sodawaterwala agreed by writing dated the 20th January 1949 to sell 1427 square yards of land with structure thereon situated in the Garden Quarters in the City of Karachi to the plaintiff Abdul Hamid for Rs. 16,750 of which Rs. 2,000 was paid as earnest money. The material provisions of the agreement in addition to those already stated were that- "the balance of the purchase money shall be paid by the vendee to the vendor within two months from this date on the vendor obtaining certificate from the Income-tax Authorities under the Transfer of Property (Pakistan) Ordinance, 1947, certificate from the Rent Controller and making out clear, valid, subsisting and marketable title to the premises hereby agreed to be sold free from all claims * * * *". It was further agreed- "that in case of any delay occurring in obtaining the requisite certificate for reasons beyond the control of the vendor the vendee shall not claim any damages etc. from the vendor for such delay nor will such delay affect this transaction in any manner which shall remain intact and in full force." By a second agreement of the same date the plaintiff agreed to pay a further sum of Rs. 4,750 within a week from the said date. It further provided- "that in case the party No. 2 (vendee) is not able to pay the balance of Rs. 10,000 (rupees ten thousands only) within a period of two months as mentioned in the agreement for sale and purchase referred to above the vendor will grant him extension up to 18 months from this date, within which the party No. 2 (vendee) will be at liberty at any time to pay the said sum of Rs. 10,000 and obtain conveyance of the property." The vendor also agreed to put the vendee in possession of the property in question within a period of two months and the vendee was given liberty to make any alterations and additions of a temporary nature in the premises. Further the vendee agreed to pay Rs. 50 per month as rent from the date of the expiry of the period of two months till the execution of the conveyance. The vendor agreed to obtain Sanad of the property and to deliver the same to the vendee at the time of the completion of the agreement. In pursuance of the above agreement the purchaser paid a further sum of Rs. 4,750 and was let into possession of the property. He thereafter made some alterations and additions in the structure at a cost of Rs. 10,

000. The contract was, however, not completed within 18 months as provided in the second agreement. On the 20th July 1950 the lawyer of the vendor gave the first notice that the extension of time up to 18 months that was fixed for the completion of the contract had expired and that he should complete the sale within three weeks by paying the balance of Rs. 10,

000. In the answer sent by the vendee on the 26th July 1950 he denied that he had committed a breach of the contract. He further pointed out that the question of payment of balance of the purchase money would arise only when the vendor would obtain the income-tax and other necessary certificates in order to complete the sale. On the 2nd August 1950 the vendor's lawyer wrote to the purchaser that his client had approached the income-tax authorities for clearance certificate and expected to get the same within a short time. He also referred to various other matters which are not very relevant for the purpose of this case. On the 12th August 1950 the vendor's lawyer gave a second notice in the following terms "It appears that you are in financial difficulty and hence you are bringing forth unnecessary and flimsy excuses to postpone the evil day of taking up the conveyance. Our client takes pity upon you and hereby gives you further extension of time of three weeks, making time as essence of the contract and calls upon you to pay the balance and to execute the sale deed within the period hereby extended, failing compliance the earnest money paid by you shall stand forfeited and our client will take legal steps against you to protect his interest as he deems fit holding you liable for all costs and consequences." The purchaser in his answer dated 19th August 1950 stated that the question of -ranting further tune did not arise because the vendor had not obtained the necessary certificates for completion of the sale. On the 1st September 1950, the vendor obtained necessary certificates from the Income-tax Authority and Custodian of evacuee Property. On the 4th September 1950 the vendor's lawyer gave the final notice as follows:- "We have now to inform you that our client has now obtained Income-tax certificate and the certificate from the Custodian of Evacuee Property Sind and Federal Capital, Karachi. Our client has done everything which is necessary to fulfil his part of the contract. Our client has given you considerable latitude in extending time front time to time to enable you to fulfil your part of the contract. It appears that you are short of funds and hence you are putting forth unnecessary hitches to postpone the evil day of payment of the balance of Rs. 10,000 and to execute the sale-deed by getting property conveyed in your favour. You have failed to do so in spite of the period being extended every now and then. This is therefore finally to call upon you to pay to our client or to us on his behalf the balance of Rs. 10,000 and to execute the sale-deed within ten days from the receipt hereof, time being hereby made as of the essence of the contract, failing compliance the amount of earnest money and further amount paid by you shall stand forfeited and our client will take such legal steps against you to protect his interest as he deems fit holding you liable for all costs and consequences. Please treat this as final as our client has given you long rope enough." On the 16th September 1950, the purchaser asked the vendor's lawyer to send him copies of the certificates obtained by his client. He also asked him to clear off the buts and cows etc which were in front of the bungalow. On the 18th September 1950, the lawyer for the vendor wrote to the purchaser that the contract was at an end. Further it contained the following passage :- "You have failed to take up the conveyance within the time mentioned in the aforesaid letter which time was made essence of the contract. You are thus guilty of breach of contract and the earnest money and further purchase money paid by you totalling Rs. 6,750 stand forfeited and you are hereby called upon to put our client in possession of the property in the same manner in which possession was given to you at the time of the contract." This action was then commenced by the purchaser for specific performance. The plaintiff contended that be was all along ready and willing to perform his part of the contract. On the other hand the defendant contended that as the plaintiff was in default he was justified in terminating the contract after giving sufficient time to complete the contract. Muhammad Bakhsh, J., was of the opinion that the defendant's view was the right view. He, therefore, dismissed the suit. On appeal by the plaintiff the learned Judges of the High Court also came to the conclusion that the plaintiff was not ready to perform his part of the contract and as such the defendant had a right to termi nate the contract after giving sufficient notice. They, therefore, affirmed the judgment of the trial Judge and dismissed the appeal. In view of the terms of the agreements the High Court found that time was not of the essence of the contract. This finding has not been challenged before us by either of the parties. Now the question is if time be not of the essence of the contract initially can one party of his own motion make it so ? Fry, J., in Green v. Saven (13 Ch. D 589, 599) dealt with this question thus :- "What right then had one party to limit a particular time within which an act was to be done by the other ? It appears to me that he had no right so to do, unless there had been such delay on the part of the other contracting party as to render it fair that, if steps were not immediately taken to complete, the person giving the notice should be relieved from his contract. It has been argued that there is a right in either party to a contract by notice so to engraft time as to make it of the essence of the contract where it has not originally been of the essence, independently of delay on the part of him to whom the notice is given. In my view there is no such right. It is plain upon principle, as it appears to me, that there can be no such right. That which is not of the essence of the original contract is not to be made so by the volition of one of the parties, unless the other has -done something which gives a right to the other to make it so. You cannot make a new contract at the will of one of the contracting parties. There must have been such improper conduct on the part of the other as to justify the rescission of the contract sub modo, that is, if a reasonable notice be not complied with. That this is the law appears to me abundantly plain." From the above it is clear that when time is not of the essence the vendor could not make it so unless there had been some impropriety on the part of the purchaser. Hence the next question would be : was there such impropriety on the part of the purchaser as to entitle the vendor to limit a particular time within which the contract was to be completed ? It is true that under the second agreement, 19th July 1950, was fixed as the day for completion. On the 20th July the vendor gave notice asking the purchaser to complete the sale within three weeks. The purchaser then pointed out to the vendor that unless he obtained the Income-tax and other certificates the transaction could not be completed. The vendor in his subsequent letters expressed doubts about the purchaser's ability to find the purchase money. These vague hints were not enough. In any event, the question of the purchaser's ability to pay could not arise vendor's obtaining the required certificates from the departments of Income-tax and Custodian of Evacuee Property. The vendor obtained the said certificates on the 1st September 1950. In the face of the correspondence referred to above, I am unable to hold that the purchaser was in any way in default before the Ist September. If so : was the vendor entitled to serve a notice on the 4th September 1950, asking the purchaser to complete the sale. I think not. I do not find anything from the letters that passed between the parties prior to 4th September from which it can be inferred that the purchaser was guilty of any impropriety. In these circumstances the vendor had no right to give an ultimatum that the sale must be completed within ten days. Sugden on Vendors (14th Edition Page 268) correctly expresses the general law on this point :- "Where time is not made of the essence of a contract by the contract itself, although a day for performance is named, of course neither party can strictly make it so after the contract; but if either party is guilty of delay a distinct written notice by the other, that he shall consider the contract at an end if it be not completed within a reasonable time to be named, would be treated in equity as binding on the party to whom it is given, but a reasonable time must be allowed." Now if it is assumed that the vendor was entitled to fix a time for completion then the question would be, was the time fixed reasonable ? This notice left ten days for the purchaser to prepare himself. When one is asked to consider whether this time was sufficient, one has to see what had to be done within that time. There is tit-thing on the record to show that prior to 4th September the vendor had offered inspection of the title-deeds. No doubt the purchaser had not asked for such inspection and he was merely insisting for the copies of the certificates which the vendor had obtained from the Income-tax Department and the Custodian of Evacuee Property. The fact, however, remains that various steps required to complete the purchase, such as inspection of title deeds, drafting and engrossment of conveyance, search in the Svgs-Registrar's Office to see if the property was free of encum brances had to be taken by the purchaser and for that purpose I think ten days could not be regarded as sufficient. In these circumstances, I am of opinion that the vendor was not entitled to rescind the contract. In conclusion I would like to add that the dominant principle I in such cases has always been that equity will only grant specific performance, if under all the circumstances, it is just and equitable so to do, The following observations of Lord Haldane in Jamshed Khodaram Irani v. Burjorji Dhunjihhai (AIR 1915PC83=431 A28) clearly bring out the principle above stated: "Their Lordships do not think that this section (section 55 of the Indian Contract Act, 1872), lays down any principle which differs from those which obtain under the law of England as regards contracts to sell land. Under that law equity, which governs the rights of the parties in cases of specific perform ance of contracts to sell real estate, looks not at the letter but at the substance of the agreement in order to ascertain whether the parties, notwithstanding that they named a specific time within which completion was to take place, really and in sub stance intended more than that it should take place within a reasonable time Lord Haldane then observed :- Their Lordships will add to the statement just quoted these observations. The special jurisdiction of equity to disregard the letter of the contract to ascertaining what the parties to the contract are to be taken as having really and in substance intended as regards the time of it3 performance may be excluded by any plainly expressed stipulation. But to have this effect the language of the stipulation must show that the intention was to make the rights of the parties depend on the observance of the time limits prescribed in a fashion which is unmistakable. The language will have this effect if it plainly excludes the notion that these time limits were of merely secondary importance in the bargain, and that to disregard them would be to disregard nothing that lay at its foundation. Prima facie, equity treats the importance of such time limits as being subordinate to the main purpose of the parties, and it will enjoin specific performance notwithstanding that from the point of view of a Court of Law the contract has not been literally performed by the plaintiff as regards the time specified. This is merely an illustration of the general principle of disregarding the letter for the substance which Courts of equity apply, when, for instance, they decree specific perform ance with compensation for a non-essential deficiency in subject matter. But equity will not assist where there has been undue delay on the part of one party to the contract, and the other has given him reasonable notice that he must complete within a definite time. Nor will it exercise its jurisdiction when the character of the property or other circumstances would render such exercise likely to result in injustice." In the present case, the purchaser on payment of Rs. 6,750 out of the purchase money of Rs. 16,750 was let into posses sion of the property as for back as 1949. To the knowledge of the vendor he started a factory there and, for that purpose, invested quite a large sum on the repairs and alteration of the premises in question. The vendor obtained the required certifi cate for completion of the contract only on the 1st September 1950. Thereafter he abruptly tried to terminate the contract by giving ten days' notice. On the whole, therefore, I am of opinion that the purchaser had not been In any way in default. There was some delay put that was not due to him or to anything that he did or for which he was responsible. It was due, I think mainly, on account of the failure of the vendor to obtain Income-tax and other certificates in time. It, therefore, cannot be said that the purchaser by his conduct has lost the right for specific perform ance. Further, in view of the facts and circumstances of the case, I think, the equity is also on his side and he is entitled to a decree for specific performance. I shall, therefore, allow this appeal with costs. For the reasons stated above, I agree with the order proposed by Rahman, J. B. Z. KAIKAUS, J.

Facts are sufficiently stated in the judgment of my learned brother S. A. Rahman and I will refer to them only to the extent to which it may be necessary for deciding the legal question that arises in the present case. I will first state the precise question that arises. The respondent had after securing the certificates needed for registering the sale-deed given notice to the appellant to perform the agreement within 10 days. After the expiry of 10 days the respondent served a notice terminating the contract. The question that arises is whether in not performing the contract within 10 days the respondent was guilty of breach of contract. It is not contended that if in fact he was guilty of such breach this suit could succeed. The answer to the question as to whether the appellant was guilty of breach depends on whether he had failed to perform the contract within the time that the law allowed him. If he failed to perform the contract within the time allowed by law he would be guilty of such breach. What is the time allowed by law for the performance of such contracts? Time was, according to the contention of the appellant, not of the essence of the contract. If it was not of the essence of the contract then the contract has to be performed within a reasonable time. This proposition is not disputed and in fact it is embodied in section 46 of the Contract Act which provides that even if no time is fixed for performance the contract has to be performed within a reasonable time. Surely if time is fixed but is not of the essence of the contract the position cannot be worse than it is when no time is fixed at all. Section 46 runs :- "Where, by the contract, a promisor is to perform his promise without application by the promisee, and no time for performance is specified, the engagement must be performed within a reasonable time. Explanation.--The question "what is a reasonable time" is, in each particular case, a question of fact." It appears tome obvious then that on the basis of this undisputed proposition the only point falling for determination in such cases would be whether there is failure to perform the contract within a reasonable time. If there was such failure it must be held that there was breach of contract. The respondent contends that the time which he fixed for performance by his notice was a reasonable time, and the High Court found that it was reasonable. The appellant did not urge before the learned single Judge who heard the suit, or before the Division Bench that heard the appeal that the time granted was under the circumstances unreasonable. All the points which were argued by counsel for the appellant were enumerat ed by the Division Bench and this was not one of them though the Bench did itself record a finding to that effect. The case of the appellant was only this that the respondent could not by his unilateral act make time essence of the contract. Before us, the proposition put forward on behalf of the appellant is this: a party to an agreement has no right when time is not of the essence of the contract to serve a notice on the other party to perform his contract even though the time fixed is a reason able one and that in order that a party may be entitled to give notice of performance within a reasonable time there must first be some default, some improper conduct on the part of the other party. For this proposition reliance was placed on some English judgments, English Commentaries and a Privy Council case from India. I will presently deal with the authorities, but I am (and I say so with great respect for the contrary opinion expressed by my Lord the Chief Justice and my learned brothers) unable to see how in the face of the admitted proposition that when no time is fixed for performance of a contract it must be performed within a reasonable time, and in the face of the statute which governs us, such authorities could be of any help. We are bound to ask ourselves in every such case only one question: did the party fail to perform the contract within a reasonable time ? If this question be answered in the affirmative we must hold that a breach was committed. If we answer it in the negative we must hold that no breach was committed. What then is the force of other propositions ? And it is to be remembered that the question of reasonable time is by the words of section 46 a question of fact. In each case we have to determine the reason able time as we would determine any other question of fact. To my mind what I have stated above concludes the matter. But I -will also examine the arguments and authorities on which the appellant relies. The main argument is this : how can a party to contract by his unilateral act add to the terms of the contract, if time was not of the essence of the contract how can he make it so ? I would agree that no party can add to the terms of a contract. But does he add to the terms by such a notice ? No, he simply exercises a right granted by statute. The law had granted to every party the right that the other party shall perform the contract within a reasonable time. You may regard performance within a reasonable time as a term which the law incorporates into every agreement when time is already not fixed or is not of the essence of the contract, or you may regard it as a right granted by law, but such a notice is not the addition of new term unilaterally by a party. Suppose one party to a contract gave notice to the other party to perform it within a reasonable time without specifying the time shall we say that there being no term fn the contract that it shall be performed within a reasonable time he cannot by his unilateral act add to the terms of the contract ? If instead of giving notice of performance within a reasonable time he gives notice of performance within a time which we hold to be reasonable does it make any difference to the validity of the notice ? Another question that arises in my mind in this connection is this: if a party to contract is not entitled to add a term to a contract (and no party can have a right to add terms) wherefrom does he get such a right if the other party is guilty of some improper conduct ? Does the law provide that a party is entitled to add terms to a contract in case of default by the other party ? It appears to me that to accept the proposition put forward by the appellant amounts to an amendment of the law. Also, the acceptance of the proposition will lead to an anomaly. Suppose the vendor gives one month's notice to the vendee for performance at a time when as yet there has been no improper conduct or undue delay at all by the purchaser. The Court will hold the notice to be invalid. But suppose there had been two days delay by the vendee in examining the documents of title and the vendor gives a notice of performance within fifteen days, a period which the Court holds to be reasonable, under the circumstances. The Court will in the latter case find in favour of the vendor, but in the former case will find in favour of the vendee though the period of notice in the former case was double the period allowed in the latter case. We can even imagine a case where a party gives notice of six months without any default by the other party and the Court finds that a period of even fifteen days was a reasonable one for requiring performance. Shall we say the notice was invalid and the vendee was not bound to perform the contract within six months ? I have little doubt that the only question the Court has to decide in all such cases is whether the party failed to perform the contract within a reasonable time and that answers to other questions are of no assistance in arriving at a decision. Coming to the authorities, the case on which reliance is mainly placed is Green v. Sevin ((1879) 13 Ch. D 589 at p. 599). The following is the relevant passage in the judgment "It is to be observed that the contract for purchase had limited no time for completion, and that, therefore, according to the rule in this country, each party was entitled to a reason able time for doing the various acts which he had to do. What right then had one party to limit a particular time within which an act was to be done by the other ? It appears to me that he had no right so to do, unless there had been such delay on the part of the other contracting party as to render it fair that, if steps were not immediately taken to complete, the person giving the notice should be relieved from his contract. It has been argued that there is a right in either party to a contract by notice so to engraft time as to make it of the essence of the contract where it has not originally been of the essence, independently of delay on the part of him to whom the notice is given. In my view there is no such right. It is plain upon principle, as it appears to me, that there can be no such right. That which is not of the essence of the original contract is not to be made so by the volition of one of the parties, unless the other has done some thing which gives a right to the other to make it so. You cannot make a new contract at the will of one of the contracting parties. There must have been such improper conduct on the part of the other as to justify the rescission of the contract sub modo, that is, if a reasonable notice be not complied with. That this is the law appears to me abundantly plain." The only argument stated here in favour of the proposition put forward is that one party cannot by his own act add to the terms of a contract, an argument to which, if it stands by itself no exception can be taken. The learned Judge does not consider and he was not called upon to consider (on account of the absence of any such statutory provision in England) as to what would be the position if the party was not adding a new term but demanding compliance only with a term which by statute stands incorporated in every agreement in this country, namely, that contracts shall be performed within a reasonable time. Also as will appear from a later portion of the judgment the learned Judge placed the case on the alternative ground that notice was not reasonable. He said : (p. 601) "But assuming that I am wrong in this view, and that there was such delay as to justify the giving of the notice, there remains the important inquiry whether the time limited for completion by the notice was reasonable, having regard to all the circumstances of the case. In my opinion it was not." In fact, I may state even at this place that no case has been cited before us and I have not been able to find any wherein the notice sent was for a reasonable' time and still it was held that the notice was invalid because there was no earlier default by a party. All cases cited are cases of notice for an unreasonable time. The next case relied upon is Smith v. Hamilton ((1951) 1 Ch. D 174). In this case the extract from Green v. Sevin, quoted above, has been reproduced. There is no further discussion. At the same time, the learned Judge found the notice to be unreasonable and based his decision on that ground too. The Indian case relied upon is Jamshed Khodaram Irani v. Burjorji Dhunjibhal (43 I A 26 at p. 33), wherein the Judicial Committee of the Privy Council while stating that in cases where time is not of the essence of the contract specific performance may be granted although the party coming to Court did not perform it on the date fixed made an observation that "equity will not assist where there has been undue delay on the part of one party to the contract, and the other has given him reasonable notice that he must complete within a definite time." On the basis of this observation alone this case has been cited as an authority in favour of the proposition propounded by the appellant. I do not see how it can be quoted as an authority. A case is an authority for what it actually decides. In the case before the Privy Council one party had been guilty of delay and the other party had given notice, and the decision was that that party was not entitled to any help in equity. Does that necessarily involve that if there was no undue delay notice requiring perform ance within a reasonable time could not be given ? That question was never before the Privy 'council. Had the intention of their Lordships been to state a conclusion on such a matter they would certainly not have failed to discuss the question which is one of great importance to the law of contract. That their Lordships were not applying their mind to the question whether party had been guilty of breach of contract is apparent from another fact. Their Lordships say that "equity will not assist". If on account of undue delay and failure to comply with a reasonable notice a party had been guilty of breach of contract the question of equity would not arise. The party would have no right in law under the contract at all having committed breach of contract and the other party having put an end to the contract in con sequence. It will be proper here to refer to the other Privy Council case where their Lordships held that on account of failure to comply with a reasonable notice the party had been guilty of breach of contract. That case is Motilal Itchhalal Gandhi v. Haji Moosa-Haji Mahomed (AIR 1925 PC 124). In that case originally time was of the essence of the contract, but the parties by their conduct waived that condition, as some matters which required completion could not be completed within the time fixed and as their Lordships observed the condition as to time was "obliterated" from the contract. The vendor then gave notice of completion of contract within four days. The vendee failed to perform the contract within four days. Their Lordships held that this was reasonable notice and on this ground alone accepted the appeal of the vendee. There is no finding, nor even any suggestion in the judgment that the vendee had been guilty of improper conduct, or was responsible for any delay before notice was served on him. The decision in this case is clearly inconsistent with the proposi tion put forward by the appellant. There had been cases in England taking the contrary view. In Parkin v. Thorold (22 L J Ch. 170=16 Beav. 59=51 E R 698), it had been held with respect to an agreement for sale of land that even if time be not of the essence of the contract a party had the right to insist that it be completed within a reasonable time. Lord Romilly who delivered that judgment said: "It is, I consider, the undoubted law of this Court, that although time was not originally an essential part of the contract, still that either party may, by a proper notice, bind the other to complete, within a reasonable time to be specified in such notice ; and if the party receiving such notice do not complete within the time so specified, equity will not enforce a specific performance of the contract, but leave the parties to their remedies and their liabilities at Law. The doctrine on this subject is I think well laid down in Walkar v. Jaffreys (1 Hare 341) and Southcombs v. Bishop of Exeter (6 Hare 213) by Sir James Wigram." It will be observed that two previous cases are referred to and the proposition stated is regarded as the "undoubted law of this Court." In Rickards (Charles) Ltd. v. Oppenhaim ((1950) 1 A E R 420), it had similarly been held that in cases of contract for work and labour reason able notice could be given to make time essence of the contract. The relevant passage runs "The question thus arises whether he was entitled to give such a notice, making time of the essence, and that is the question which counsel for the plaintiff's has argued before us. He agrees that, if this is a contract for the sale of goods, the defendant could give such a notice. He accepted the statement of McCardie, J. in Hartley v. Hymans (1920) 3 K B 495, as accurately stating the law in regard to the sale of goods, but he said that that statement did not apply to contracts for work and labour. He said that no notice making time of the essence could be given in regard to contracts for work and labour. The Judge thought that the contract was one for the sale of goods, but, in my view, it is unnecessary to determine whether it was a contract for the sale of goods or a contract for work and labour, because, whichever it was, the defendant was entitled to give a notice bringing the matter to a head, It would be most unreasonable if, having been lenient and having waived the initial expressed time, he should thereby have prevented himself from ever thereafter insisting on reasonably quick delivery. In my judgment, he was entitled to give a reasonable notice making time of the essence of the matter. Adequate protection to the suppliers is, given by the require ment that the notice should be reasonable." The facts as well as the conclusion in Finkielkraut v. Monohan ((1949) 2 A E R 234) will appear from the following headnotes :

"On Dec. 10, 1947, a contract was concluded for the sale of certain property. On March 31, 1948, the vendor sent to the purchaser a notice to complete within 14 days. On April 14, the date fixed by the notice as the final date for com pletion, the purchaser was ready and able to complete, but the vendor was unable to do so. On the same day, the purchaser sent to the vendor a three days' notice to complete, but the vendor was unable to comply with it, though she was in -a position to complete on April

30. In an action by the purchaser claiming a declaration that he was entitled to rescind the contract and a counter-action by the vendor claiming an order for specific performance : Held, (1) by her notice of March 31, the vendor made completion by April 14 an essential term of the contract so that the rule of equity that the time fixed for completion was not of the essence of the contract no longer applied ; as the purchaser was bound by the notice, the vendor, having given the notice, was also bound thereby ; and, as she was unable to complete on the day fixed, she was not entitled to an order for specific performance of the contract," This too is a clear authority against the contention of the appellant. In Thorpe v. Fasey ((1949) 2 A E R 393), relying on Cornwall v. Henson ((1900) 2 Ch. 302) the learned Judge found that he could not hold the contract for sale to have terminated because "it is not possible on a fair reading of this correspondence to find any intention on the part of the purchaser to abandon the contract, or that any sufficient notice before action brought was given to him by the vendor that if the outstanding purchase money was not paid within a specified time the contract must be considered at an end." In Cornwall v. Henson the conclusion of the Master of Rolls was in almost exactly the same words. So far as the English Commentaries are concerned, in Anson's Law of Contract the proposition propounded by the appellant finds no place. In Chitty on Contracts at p. 186, Vol. I (1955 Ed.) it is stated that :- "The rule of the common law was that time was always of the essence, and that if a particular time were fixed for performance under the contract an action would lie if performance were delayed. Now, under the Sale of Goods Act, 1893, section 10, unless a different intention appears from the terms of the contract, stipulations as to time of payment are not deemed to be of the essence of the contract of sale. Whether any otter stipulation as to time is of the essence depends on the terms of the contract. The parties to such a contract, and to a contract for sale of land or work and material can give reasonable notice making time of the essence of the contract. This is inconsistent with the proposition put forward by the appellant and is in accord with my conclusion. On p. 187, however, the Commentator also states: "Time cannot be made of the issue of the contract by means of a unilateral act, unless there has been some impropriety, committed by the other party." It is unusual for Commentator to state two inconsistent propositions without discussion and without saying which of the two is according to him correct. In Pollock on Contracts (p. 415 of 1950 Edition) the law is thus stated "The fact that time is not specified as to be of the essence of the contract, does not affect the general right of either party to require completion on the other's part within a reasonable time, and give notice of his intention to rescind the contract if the default is continued, as on the other hand conduct of the party entitled to insist on time as of the essence of the contract, such as continuing the negotiations without any express reserva tion after the time is part, may operate as an implied waiver of his right." This too negatives the contention of the appellant. In the Law of Contract by Cheshire and Fifoot (p. 451 of 1960 Edition), it is stated that stipulation as to time is in law an essential requirement but becomes so in equity in certain specified cases and one of them is "where one party has been guilty of undue delay, he is notified by the other that unless performance is completed within a reasonable time the contract will be regarded as broken." But Parkin v. Thorold is also cited as one of the authorities that support this proposition though it is an authority which supports my view. To sum up, there Is in the first place good deal of authority in England against the contention of the appellant secondly, in the cases which appear to support the appellant the notice itself had been found to be unreasonable and there is not a single case where with respect to a reasonable notice it was held that the contract had not been validly terminated ; and thirdly, we should not in this connection refer to English authorities at all for there is in England no statutory provision entitling a party to perform ance within a reasonable time and Courts are guided only by equitable considerations on the facts of particular cases. I would, therefore, hold that a party to a contract has the right, although time is not of the essence of the contract or no time for performance is fixed in the agreement, to give notice of f performance within a reasonable time. He can fix the time and it is for the Courts to find as a fact in each particular case whether the time that the party fixed was reasonable. The next question to be considered is whether the time fixed in this case by the respondent was reasonable. There does not exist any particular criterion for determining what is reasonable time and it is just a question of the impression that all the circumstances make on one's mind. Considering that a long time had elapsed since the agreement was made, that the respon dent himself was unable to secure the necessary certificates in time, that possession had already been delivered to the appellant and that a large or portion of the consideration had been paid, I entertained a doubt as to whether the time fixed by the respondent was reasonable. My Lord the Chief Justice and my learned brothers are of the opinion that it is not reasonable. As it is a question of fact I would not ordinarily interfere with the finding of the High Court unless it was clear that the time fixed was unreasonable. Considering that I myself entertained a doubt and that my Lord the Chief Justice and my learned brothers are inclined to hold that it is unreasonable I would not disagree with them. In doing so I am acting on the principle that we should not refuse to enforce an agreement unless it is clear that it has been validly terminated. I would therefore agree on this ground that this appeal be accepted. HAMOODUR RAHMAN, J.

I have had the advantage of reading the separate judgments proposed to be delivered by my learned brothers S. A. Rahman, Fazle-Akbar and Kaikaus, JJ. I am in entire agreement with the reasoning and conclusions of my learned brother S. A. Rahman, J. and have nothing further to add. The appeal is allowed and the judgment and decree awarded by the trial Court are hereby set aside. A period of two months is allowed, in which time, questions of title to the land may be clarified to the satisfaction of the plaintiff, and accounts between them may be settled. At the end of that time i.e., on the re-opening of this Court after the Christmas vacation of 1961, the parties will submit either jointly or separately, a statement as to the steps taken by them, as indicated above, for further action in respect of the drawing up of the formal decree, which will include a direction as to costs. A.H. Appeal allowed.