tb sequence of the Rader ;of details, and lied on the epbssis and proportion given to certain “ thot matters were . cazainlly .in the Conrts below; they have laal’ with by the judgmentsin both hod they bare’ been very fully before their Lordships by Miss in the course of her caes has istance to the Board and plain that the ‘whole tha case has been put forward ‘Appeal. ‘Their Lordships wish wad. vaid in the Courta has argued the pdoar and with great all the point fora them, and, jared them, they are quite 6, tbe case made in this Insufficient to displace that is derived from the z that thera was in this fing in fact. The suggested Feen be explained by the ‘work, which bas common @ by the fact that both sate had recourse to autho. ire common toboih. After ive Deeks nor Mr. Welle MN 4b the beginning of tho world cousidersble time later, ‘Nave bad to rely upon the ac. ¥a.ol information which has been ma meany authors.before them and hi they have had to have rocou ing “such & work a5 ¢ The Pips de aot panse to deal with the the evidence that was given, it fs quite pro. Bi doerict are ‘qtite explicable, and shoald ‘a seplaloed, in tbe ssanner suggested, a i recult is this. that in the opinion y OF their Lordships not only did Mise p Dorks fait male ont her caso, hat that : Falinitely estublisied that tho in this eaco did not torve A that Mr. Wells did not have any accne-to. in the, preparation of bis 7S Yory doabsful whether anythingthat thie’ Bontd says or that'any Court ‘says will: ba likely to alter Miss Deeks’ opinion: of she will ave tho astistaction of shel’ the cass Hes. been very fally cor i three Courte aud thag*: must be the same in all of them," namaly, that the’ case that-she made was definitely disproved. “T! eulé of that ie that thair Lordcbips m humbly advise His Majesty that this a; Peal sboald be dismissed, and the ep: lant wast pay the costa of the aippeal, ere wat potition for leave to waduog further evidence or add to the record, bat thes petition was not opened. Not! ing need therefore be said about the petition, except that no order iz made upon it. s + V8, Appiah divmizsed, Solicitors for Respondatte — Gedge, Fiske & Oo., Broad & Sez, A. LR, 1983 Privy Council 29 (rom Calcutta: AIR. 1980 Cal, 11a) 22nd November 1932“ Lonb Taanrerton, 81m GroncE Lownpes aNp Stn Dinsaam Monta < Currimbhoy & Oo. 'd.— Appellants, - 4. A. Creet and others—Reapondents, Frivy Council Appeal No, 21 of 198; } Appeals Nos. 29 of 88 of 1990, + atract—Conitruation—Whether a gentract ts condition searedpreceion ‘of desire.is question of struction, iis Where the documents of letters relied on a coustitating a contract comtemplate the axecn- (lon of a quriher couiract batworn the + cata there ding vontraet ond the ruference to the more formal decameat may ba ignored : 22 1994 PC 47, a (Pacey th) Conteact— Specific Ferfe fendeut should a t int [che motu veleim Is incompetent, and any. atnst, twit do it be waite till the thereby allow! anit for ri ‘Shree fe speelfic’ periormance meses - ‘wis sail clam for spec ea hota the posssasion of a dispoted collieiy of boib the Gafendanta mst be attributed fee FRreesion given to one ot the defendants by both defemdants are barred” b; W: 8. Upjohn, U. De Gruyther and J.H. Parikh ~ tor Appellants, A. Uf. Dunne, Gavin Simmonds, 8, Brom and L. PB. Pugh for Rospon. ote. Lord Thankerton —These are.two con. » golidated appoals from a decree of the ‘High Court of Indicatareat Fort William i Avgusé 1999, vary. ib A. Croat against © Ooeman Jemall & Sons, Limited, for thas possession of certain coal mining lands in Mouza Khandra, for an acconat of the coal extracted therefrom by Jamalla, und for damages for breach of contmet, Tn the altemative » somewhat unusual de. crea fox specific petformanes was asked for, Ta June 1995 Jamalls went into com. pulsory liquidation, ond oa I7th July 1926, the liquidator wos added as defor. t 2 : om 2nd Ostober 1998 the liqu: ‘stor filed a written statement adopting the written statement filed by Jomalls. On 28th July 1927 Curvimbhoy & Oo, Utd. were added as defendant 3, a9 » Party claiming to be interested in'the dands in suit under an Sgreemont with demalle dated 18th September 1929, nnd 9 written statement on 12th Auguat 1937, n 95th Januar 1928, the tiqui- stor of Jamalls assigned io Curritobhors the whole rights and interoota of Janalle in their sileged coutract w: the subjoot-m and in the plaivt and equipment of thoir callicry on the lads in suit, us well ne ia loneys depositod hy them under orders of the Court, mins- prospecting leases (nin of the Ja fs: Pondones, in- agrood place ore MEd obtek in respec: ods in Mousa Khang, ini oe to over the’ hoald z : lollowed, mostly by corres. * | course of whith Creet shat Jamalla should take ovér the immediately; and, in faot, the; 2 took possssion from Crest of gertain ©. lands, Shtetrtrel Tune 1990, and proceed work the minsral Creet, prospecting leases, titles volved Inyed hia obtaining som ‘ances o! theas faded the shafb, on 1st ied to develop and - On the other bend, at time had only gos proceeded to obtain fo the mi and became i in cortain litigations, which de. { of the convey. 7 ibe mineral rights, Some of ill pending when: the who af were resent suit wae commenced... . Phe male ense for the plintit’ -Oréer: ‘was that 5 contract was concluded bet.4 ‘Woon him and Jamally in Max 19: der which i Doyo to sxotute a formal aaraimant embodying the: terms of the oonttaet, 'yed their execution. of, ent, thet, finally, in he formal 5 ve them noties thal if did aot execute the ay | witatn Tourtoen sontract tobe at_an end and that, in th ol the contract, they failed to do 20, ta BI Gsiming khas possess breach of contract, cual extracted, on th: Were trespassers. Alternati if tho Gourt finds thet th ave a right to hare a: fleally the presanteait, ion, damages for 4nd an account of tha 2 footing that they oly, he asked, e° defendants] BY eputract, speci.| a decree for auch lay ha rais enforced,” for specifis performance and a decrea for all * sych sum or cums of money or moneys that might be payable-by the defendant and for exeouting agrooment and convey | Aneca-meationed ab ments, should defendants wus ¢ cluded ag Joga ty eve or all such agree. ‘nd conveyances as to the Court seam fit. The main ‘case tor the hat 9 continet was con. between Creat and Jamalls ia in terms similar to those al- the plaintiff, but with the ex- copGwe sf any obligation to execye a foxweall in eth ashen marecment aud that they wera not Of the contract, and they Mee a docros for Specific por-CURRIMBROY & Co. ¥, Oneen, jérmonce. Certain other grounds of de ce will be noticed Inter. a 12th Oot ed the pleintif’s version of the Gatract and held that Jamalle ware in ach of the contract in February 1998, a duly rescindad posses after that ‘nd were accountable for the value Ol the coal extracted, less the cout of Taising i to the bank, rom the end of February 1998, until 1928, whi he as. "ested at Re. '5,60.415. He awarded Ra 6s for breach of -eon. $ dgainst these eams he allowed 4 tion of Re. 80,000, which Jamalla 2 - bed advanced to the plaintiff towerds " the prica payable under the contract and Ribich he regarded as earnest money 4 ~ but bo disallowed the deduction of pay: ments by Jamalts to Creet, amount. j. ing to Rs. 7,611-18.9, to reimburse the Jatter for outlays. ‘The learved Judgs rejected all the defendants’ contentions sul gave dectes for khas possession and for Ra. 5,49,545 with costa, Defendsnt 3, Currimbhoys, appealed against this deeres to the Hi which disposed oft August 1929, of the Subor related to Curtimbhoys, save ne te costs, fd in Liew thereof decrved: {al that Garr? ‘inbhoys sbosld mate over possestion of il lands, suriaes and undergrown? sence tioned in the plaint savermig except tho {ands coveriel dy: the conveyecct trom Hee Surkars in their favours aeten 25th + peember 1924, with a declaration tht + the plaintiff Creet was entir to" reco, FP Fer damages to the esteet at ws share in {he nds et Karabagen outing the petiod from 28th Taly 199h 16 as Neveraber 1924; and th) thas in Tespect of such (amazes Curiubhors shoot Greer w sam out of Rs: Si pee iu propor. San to his (Cy t's) share in the lands of i 7 bith tnterest. Prey further tha euse to the lower Court. to ale, and at af the lowe t¥ later te expla © defence wounded an (ie Sarlars, dou this th Court was based on h superseded sontract there might bave born, They fook a slightly mors Isberal view of tie, deductions to be allowed in caleulating the value of the coal oxtrasted, and thay omitted the damages for breach of oe. tract a against Currimbhoys, While praviously thera way have been fome doubt currant as to the law tn Tetmarkable that, 188, the | attention wes called at the hearing belore their Loni. ships no reference wes medo to the de, ¢lsivn of this Raned, dated 20¢h Parker, J. in Wotefeb?. Aleaunder (3) at py, Parker, J, stntey : od tRDeRCa to bo Ell settled by the autho Titles that i¢ the documentear legs ogi eneigattituilog o contract sontenoptnto the fitlon of g further contract batw: itis a quan extion of term of the of coustra k eB fe no: ertforecante cont the condition is UniulBited or beens dors uot rocoguica a contract (nt featruct. In the Intter ease there ing eantract and the referes wal document may be igreret: In the execution of yas the pluintit itd the Subordinate Fudge londed to bo a sain of May 19yo, ‘Wer Hever bocame aa en! the fading of bro, fared. Tf, on the otha Pes Toon 82 OF Ch 281 LF ta as| *9Privy Council“. Coannaor & Co. hand ¢ maintained by the defendants, [2 @ moro expression of the dosirs fer ‘formal agreement, it could be igno. ted, and ony eate of breach of contract by refusal to sign it equally disappeared. Tk follown, as before their cade Lordships by plaiatifi's counsel, that it treat the defen. 0 longer po poesible to originally granted _by $! im that tendon ‘wore in breach of contract and that tI Tove trespassers alter Februsry 1923, thas out of the way, their Lord. ships are of opinion, in the view that j they tnke of the oage, that it is immate. tial whether there was a concluded con. tract or not, but it is necessary, frst of all, to dispose of certain contentions pd maintained hafore them on behalf of “Harrimbhoys. Ib was maintoined on behalf of Cur. rimbboys thot, os assignees of Jamal they wore entitled to a desres for epeci- jormance of a contracb concluded y 1920, 28 maintained by them, or, failing. that, a contract to be implied from the possession then obtained by them and the subsequent actings of both parties, whether these amounted to » wniver of the condition os to s formal agreement, leaving the remaining torms ag a concluded contract, or necessarily implied the conclusion of a now agroe- ment. While & perusal of the corres. pondencs from May 1920, to Febranty 3328, satisfies their Lordships that tho for a formal agreement wns tedly made and naver dopartod e ‘by the plaintiff, and that no new agreement can implied trom the rea gosto, as the pint "s attituds jndes soy euch couclusion, any claim this defendants for specific relief is now. clearly barred’ by! limitation and * cannot be entertained. It was ndmitied by the defendants’ counsel that in the mofussil Court a counterclaim is insomn- lpetent, and any such laim must be cn- forced by a, separate suit. No such suit hms bean raised, and any such clin has Jong ‘ago snfered limitation under fmt, Aat, which pros. from ihe performance, o7, if no suels when tho pilaintit has J 2 per late &xed for Mute is Bred Hefendants’ vounsel souzht to fone on in passage in the judgment of this Boxrd ¥.Onset(hord Thankerton) "1933 in Aviff v.Fadunath Majumdar (3) (ab p. l0lef S81 A) the passage ic se fol. loses find themselves te eae ith soe youth Court ‘in the iow Uh fret that the respondent's verbal contract had been the commencement of the af The rapondes wi notin ps in poi parorannen Of toe sant fran on ema ia thi a same tine ao aed. ta thivadtion’ Had bs been ao.ectitied, the ‘position, would. bs diferent, for then the uly have reqinery roeus action téing mayed ie the m avtime. Tn there cirenmatances the teapondent you obtsin soumplets protection, bak eons istion of ihe provisions ol the Tedina Statute, ” In the dase enggested in the latter pa of that passage, if the respondent had delayed until, Bb a date rubsequent the raising of the ejestment action, hi Fight to institute the counter-action came barred by limitation, he would hav been no better off tian he wae -with th Vimitation ber in operation when the ietment astion was instituted. ‘There remains the contention of Carrimbboys based on the registered lense by the ‘Barkers in their favour, dated 25th Nov. omber 1924, of theit rights as coshsrers to the conl lying under 100 bighas of bajonpti khas and kbns khalasi lands in Mauza Khandra, and,in particular, under Karhagan, whieh-is part of the lands of which recorery of possession fs sought by the plaintiff jn thisosse. They maintain that tho plaiatif’ claim to kins. porees. sion must be limited accordingly, and that aay claim to the value of coal ox. tensted after 25th November 195, must ‘also be so Simited. ‘The Subordinal Fudge held that possession of all land: in the mauza by the defendants must be attributed to tha possession given, 4 Sawalls by the plointifY and that, in] view of 8, 116, Bvidenee Act, they could not question the titla of the pinintifi til they had surrondered possecrion to him! ‘The High Court sustained the contention of Curvimbhoys and,as alresdy stated, found that the plaintif's claim, for W BATROMI Fevay von aaa Sw ieee. jew thatsho property, surfaceand underground covared by the leaso of 25th Novern= wor 1924, It is dificult to follow thee pes'yon for excluding the operation of 1 §,/116, especially as they found that heir Lordships agree with the Snding of he Subordinete Judge that the posses. ion of both Jamalls and Currimbhoys ast be attributed to th i Jamslle by the 8. 116 from questionfng the plaintiff's itle until they have eurrendeted posses, ion again to him. It‘was argued that 8.116 only excluded a cbaltenge of the tiff's title ag at the time when he save possession to Jamalls, and that the pleintif’s title was only challenged ag from snd after the lease by the Sarkers, but the Sarkers only communicated to Carrimbhoys the same title as they had hold jn May 1920, for the plaintiff's ace tion against the Sarkars proved, in ita re. salt, that he had no right to 0 title trom Accordingly, any right of chal. Tenge open to” Currimbhoys was equally epen to the Sarkers in May 1990, when Jamalls were given possession, ‘Their Loriships ate therefore of opi- nion that tho plaintiff Greet is ontibled to Khas possession of all the lands, sur. fece ond underground, in Mauss Khan di which are in the possession of tha defendants, and that the detondants must aceount to the plaintif for the Yalu of thocoal extimeted by them F _ duriog the period of their possession fon pwet June 2920, onwards on the lines ‘Sitcrcinutter indicated, subject to adjust Tont As vezards certain payments whieh the oluintil! baa received. Vor this part hore it will be equitable to revise the ‘etree of tha Subordinate ‘Tadao naive fefendants 1 and 9, -a8 the ‘clave fer % fox breach of contract is not vid all tho-defendante shut 1 the saine decrcs, ‘9 nécouns to ha taken, the “ill he credited with the seuss * coal, calculated, so far as he Lally realized JAGANNATH v. RAMDUAROSA , Privy Council 33° Torly ineurred by the defondants io gate bing the coal, bringing it to bank ced marketing it including any reats or royalties so ineurred; if these re not ns. eortainable, the Court will fix x proper rate to be deducted trom the gross valus in rospactof those matters. A deductions from the grosa value will also be atlowed, to be bared on 9 roasonadle rate of de. presiation on any eapital expenditure by the defendants in respost of development of the mines, structures above and below ground, boilers and machinery, properly incurred for colliery Purposes, Any amount realized on their ramoval under deotes of the Court is not necessarily re. lovant te the determination of a Proper tate of depreciation, The net amount thus arrived at will form the Girst iter in the occount: The defendants will be Credited with the ‘following amounts, . iz: (1) the sum of Rs.30,000advaneed by them to the plaintiff. which was al. lowed a8 4 deduction by the Suberdiaste Tudgo, (2) the sum of Re. 7,641.15. by the defondants to Creat, disallowed by the Subordinate Judgs and (3) the eum of Rs. 55,000 paid inte Court by the dofondaats, “and subsoquently paid aut to the plaintiff. Tt will bo Recessary to vedali tha decrocs dated 12th October 1928, and 93rd August 1929, and to remand theesss to the High Court to ascortain the halanes due on em account takon en the shove lines, the Court datermining what intorest, itany, should propocly ba allowed on any of the items, and to dispose of the exse. ‘Thoir Lordships will humbly advise His Majesty accordingly. No costs will be allowsod it the lower Courts up to Ul Present atago or in tha present appenla; any further costs will ba dealt with by Court in India. VAS. Order accordingly. Solicitors for Appellants—!Pathinsand Bunter. Solicitors for Respondeats—Sanderson Tee & Eo, AIL. 1933 Privy Councit 33 n Me: (Prom pur) 29th November 1932 Low hn Can Siem cverey Fogannat Wore rs2S.C.R. SUPREME COURT REPORTS 405 For the reasons given above we allow the appeals and answer the question referred to the High Court in favour of the assessce. ‘The appellant wall be entitled to his costs in this court as also in the . High Couet ; there will be one hearing fee. Appeate allowed. MRS, CHANDNEE WIDYA VATI MADDEN % . DR. GL. KATIAL & OTHERS {B.P. Soom, 6. J. J. Seam and . “N. Raragoraa Axxaxeas JJ.) 4 fermanee-—Contrac. ta. sell howe, proper Implie wcife ante te A eit owed Janta fiat tina in thie Court, ‘The plaintifi-respondents eatered inte, a contract of sale in respect of a house ty belonging to the appellant. The Fa eer nat ihe endor. shall obgain the lef _Commninsi the transaction of jewlihin two months of the . Permiaeion was not forthooming within that time, it wat open to the purchisers to, extend the date or to treat the agreement azcancelied, As, the noscesary Oat in war BOT TarTaED fortheom- ih time, the purchasers extended the "i fg withia the stipulated iioe by avether_ month. The appellant, withdrew, her applicas tion for the necessary permission, defendant having fied. to perlacr ther part of the conteact, the plaindfls brought a tult far specie performange of the contract for aals-or in the altcrantive for weethe tial mut, though i Tif hed been throughout ready and willing, their part of the conteact and that had barked out of it, refused the main over 40 the propered transfce had. not been "The High Court came to the conclusion 1363, Pili Jotn Plahae ‘Foner Comminiosr snatoran tate Das J. ment and if the said-496 SUPREME COURT REPORTS (1964) VOL, Tas amMbleted contract between the parties and that the condition in the agreement that the vendor would obtain the Held that on the findings in this case, the court had defenince the terms of the coniract and wo enjot ures defendant-appellant to make the necessary application te the Chi Commissioner, which -was imptied in the contract. I wil Ps forthe Chief Commissioner to decide whether az og to cree RE USceHATY sanction. “Tn the event of ihe, manta being refused, the plaintiff shat! be entided to the damages as decreed by the High Court. In this view of the ‘Foatter, the High Qourt was entirely correct in dessecing the suit for speclic performance of the contract; : * Matiagy, Nonkdat (1980) LR. $7 1, A. 35, referred to. Held farther, that the Points not specifically raised in the High Court nor Pleaded in the Pleadings should not be allowed for the Gr tine to be rated in thts Chore Crvt ApPetiare JoRispioron +-Civil Appeal No. 559 of 1962, Appeal from the judgment and decree dated March 21, 1961, of the Panjab High Court (Circuit Bench) at Delhi in Regular First ppeals Nos. § D and 21-D of 1960. 4. Ranganadham Chetty, 8.K. Mehta and X. L. Mehta, for the appellant. 4.0. Setalvad, Hordayat Hardy and §. N. Anand, for the respondents. 1963. March 25, ‘The Judgment of the Court ‘was delivered by Soma C. J.—This appeal on a certificate granted by the High Court Punjab arises out of asuit for specific performance of & contract of sale in respect of a house Property situate in Tughiak Road, New Delhi, belonging ‘to the appellee 3 built on a leate-hold plot granted by the Government2S.C.R. SUPREME COURT REPORTS. 497 in the year 1935, to her predec in-title, It appears that the plaintiffs entered into a contract of sale in respect of the disputed property for the sum of Rs. 1,10,000/-, The deed’ ol agreement is dated Sepiember 4, 1956. In $0 far asit isnecemsary to notice the ccrms of the document, the agreement Provided that the vendor shall obtain the permission of the Chief Gomuissioner to the transaction of sale withia two months of the agreement, and if the said permission was not forthcoming within that time, it was open to the purchaser: to extend the date or to treat the agreement ae cancelled. As the neces- rary permission was not forthcoming within the stipulated time, the purchasers - extended the time b. another month. ‘The appellant had made an appl cation to the proper authorities for the necessary permission, but withdrew her application to the . Chief. Commissioner by her letter dated April 12, 1957. The plaineifis called upon the defendant several times to fulfil. her part of the agreement but she faited to doso. It was averved on behalf of the plaintiffs that they had always becn ready and willing to perform their part of the contract and that it was the defendant who had backed out of it. Hence, the suit for specific performance of the con tact for sale or in the alternative for damages amounting to Rs. 61,100/-. The suit was contested ona large number of grounds of ‘which it is nece> sary now to take notice only of the plea on which issue No. 8 was joined. Issue No. 8 is as follows : “48) Is the contract contingent or impossible of performance and is uncertain and vague and is therefore void t” The other material issues were concurrently decided in favour of the plaintiffs, and, therefore, need not be referred to. The (rial Court in 2 very elaborate judgment dismissed the suit for specific performance of contract28.G.R. SUPREMECOURT REPORTS 409 a the sor the rights of the parties, it recorded a finding that the a sum of Rs. 6,775/- would be the appropriate amount out of damages in the event of the plaintiffs not _succecd- ein ing in getting their main relief for specific perfor- ant mance of the contract. The main ground of attack on this appeal is that the contract is not cnforceable being of a con- tingent nature and the enntingency not having been fulfilled. In our opinion, there is no substance in this contention. So far as the parties to the con- tract are concerned, they had agreed to bind them- alu. selves by the terms of the document executed between for them. Under that document it was for the defen- on dant-vendor to make the necestary application for ion the permission to the Chief Commissioner, She was had asa matter of fact made such an application ate, but for geacons of her own decided to witbaaw the rncek same, [Qn the findings that the, plaintiff have mt always been ready abd willing t perform their IP 2 part of the contract, and that it was ie defendant i who wilfully refused to perform her part of the , contract, and that the time was net of the essence of PP ‘he’ the contract, the Court has got to enforce the terms of the contract and to enjoin upon the defendant he appellant to make the necessary application to the h Chief Commissioner, It will Be for the Chief 4 on Commissioner to decide whether or not to grant the Jenn necessary sanction. Ip this view of the matter, the High Court was entirely correct in decreeing the suit for specific performance of the coatract. The High Court ahould have further directed the defendant to make the necessary application for permission to Chief Commissioner, which was implied in the contract between the parties, As the defendant. yendor, without any sufficient reasons, withdrew the application already made the Qhief Commis. sioner the decree to be, prepared _by thi add the clause that the delendant, within one morth500 SUPREME COURT REPORTS [1964] VOL. from to day, shalt make the necessary application to the Chief Gommissi ‘or to such other competent authority as may have been empowered to grant the necessary sanction to transfers like the one in question, and further that within one month of the receipt of that sanction she shall convey 10 the plaintiffs the property in suit. In the event of the sanction being cefused, the plaintiffs shall be entitled to the damages as decreed by the The appellant sought 10 raise certain other pleas which had not been raised in the High Court, for example, that this was not a fit case jn which specific perfor- that iis Meontract should be enforced by the Coor. This plea was not specifically raised in the High Gourt and the necessary facts were not ples fn the pleadings. It is manifett that this Court should act allow such a plea to be raised here for the first time. For the reasons given above, the appeal fails and is dismissed with costs. Appeal dismissed.KOLLIPARA SRIRAMULU ¥. 'T. ASWATHANARAYANA & ORS. March 4, 1968 D.C. Sea, V. Rawaswant aD G. K, Mirren, 112 Coniract-—Dral cgretment to sell land—-Fornsal_document to-be se: cued later bul_not act i-Mate of payment of price ax gettled—Contract whether inding,- ettled-—Contract whet ~Partiion dct 4 of 1893, «, 2--No application made under section: High Court whether empowered to give direction ax 10 alfointent of perti- etdar area on partition. ‘On Apri 15, 1940 respondent No. 1 fook om ten yeart! lease 2 the for the of building & cinema theatre, from a partnered ‘frm, He the Damen itp cinema theatre on the land. Appeliant No. thoreajed a suit for diseolution of the firm and for accoutes Respondent No. 1 who was impleaded a5 a ‘defendant resisted the suit. Jn 1950 the NO. ‘ued a. sult to evict the first respondent from he Jand, In this dso implended 28 a defendant and pe claimed that 1 23 in the frm he had acquired 39 shares Mi ponseat NO, 1 also fled a suit alleging that 2 the ‘partners of the firm except tbe ‘appeliant had entered into af oral, with him on July 6, 1952 to sell 137 shares in the sile except aereg thares, belonging to, appelant No. 1: that 96 Stet ‘hed ‘octoally qe 28 to iy that 39 shares bad not been sold to Tit, ore bad been jnstead sold to. appellant, No, 1. Respondent ‘No. 1 thereafter claimed ieSfie pertormance of the aggeement to sll the ‘aforesaid 39 shares by specie Pers and contended, tat the sale of these shaves in favour, of Sppeliant No, 1 was not binding upon him. 7% tulal court decided against Fespondent No. 1 byt the Hi decided in his favour. Io appeal responders Court the following, questions came UP [01 consideration a 0. i was ineffective because the formal document or because the erase money was not actually agreed UpOm: ‘purchased by him appellant No. 1 rhether in the sbsenoe of an spplica~ tion 1899 the High Court was right in es oe thal afar ape the te on eS NS Biidiag stood should be allotted “oe the share of respondcat No. 1 6 it ee Was entitled. Bulag rised within the 137 shares to which HELD: (i) On the fects of the case, the High Court was right ic hotding that there Was a0 mgreement 10 sell 137 shares in the site to res" pont io (Gi) A mere reference 10, future formal earrat es not prevent the ciistenee of a binding agement between |EDIT, nuns. ihe the enstege> Of ature contact is made ia atch 1805 7 9, show that the Pander did wot intend to be, bound Un 8 Formal contact is signed, ThE question mie menfien “of the partes and the special ciecumn, is question HePeoh paricular case. 1a the preseal Oe the evidence did not stances or he drawing wp of a weilten serceregy “was a prerequisite 10 stow teitg into effect of the oral agreement, 1393 C-D)388 SUPREME COURT REPORTS 11968) 35.08 Nov did the absence of a specific agreement as to the mode of payment necessarily make che agtsement incflcctive. Since the vital terms of the comfract like the price and arza of the land and the time for completion of the Sale were all fixed. [594 E] (iit) The appeiant had been unable 10 establish that in respect of the 9 Shares purchased by hima he was & purchaser without notice [393-A-B] fv) In the absence of an application by the respondent under s. 2 of ion Act the High Court had no power io make a direction 95 10 the particular portion of the site to be allotted to respondent No. 1 on partition, 1395 D-El . 3 Rema Prasade Rao v. Subbaramaich, (1957) I Ae. W-R. 488, Ridgw Wharton, 6 HL.C. 238, Von Hatzfeldt-Widtenburg v. Alexander, (1912) 1 Ch, 284, Rossiter v. Miller; 3 A.C. 1124 and Currimbhoy and Company Lid. v. Creet, 60 LA, 297, referred 10, Civ APPELLATE Jurispiction : Civil Appeals Nos. 427 and 428 of 1963, Appeals from the judgment and decree dated March 25, 1960 of the Andhra Pradesh High Court in AS. Nos. 380 and 331 ‘of 1956. H.R. Gokhale and K. Jayaram, for the appellant {in bows the appeats). S. T. Desai, P. Parameshwara Rao and R. V’. Pillai, for the respondents {in both the appeals). ‘The Judgment of the Court was delivered Rameswami, J. The appellant in both the appeals was one of the partners in a firm consisting Of about thirty partners which was running a mill named ‘Vasavamba Oil and Rice Mill” ai Vijayawada. The partnership firm owned not only a factory but also a site of the extent of about 3845 sq, yards. The total number of shares in the parmership was 160 out of which the, appellant owned 23 shares. By a document dated April 15,| 1940, the firm executed a leasc in favour of the Ist respondent and another person of the area of the site for a period of 10 years. ‘The lessee was permitted to construct a building for the use of a Cinema Theatre. The annual rent was Rs. 750/-. In the year 1948, the appellant filed O.S, No. 196 of 1948 in the Subordinate Judge's Court, Vijayawada for dissolution of the partnership and. for accounts. On December 20, 1951 a preliminary decree was granted in that suil. The first respondent was added as 17th lefendant in that suit. He contended in that suit that the manag- ing partner of the firm had covenanted to sel! 10 him the site leased out and that in any event he was not liable to eviction in view of the provisions of the Madras Buildings (Lease and Rent Control} Act. In 1950. before the passing of the preliminary decrec, a suit was filed in the District Muasiff's Court, Vijayawada A c D F H“ 390 SUPREME COURT REPORTS 11968] 3 scr, a, dants) O.S. No, I of 1956, For the same reasons he held that in the A suit for partition namely, O.S. No, 2 of 1956 the appellant was entitled to 62 shares and he Sranted a decree for partition and possession thereof as also damages at the rate of Rs, 2,000/. per annum from May 1, 1950 to the date of the delivery of Posses- sion of his shares. ‘The Ist respondent took the matte in appeal before the High Court of A. P.—A.S, No, 380 of 1956 against’ ‘O.8, No. 1 of 1956 and AS, No, 381 of 1956 against O.S, No. 2 Phat 2 8,2 common judgment dated March 25, 1960 the High Court allowed both the appeals. It was held by the High Court that the oral agreement pleaded by was therefore vatied. ‘The appellant’s share was fixed at 23/160th. A direction no was also given by the High Court that in the actual Partition, as far as possible, the lower court should allow to respondent No. 1 that. portion of the site on which the cinema theatre building constructed by him stood and if thar wee FO! possible, the trial court may follow the Procedure indicated D in Rama Prasada Rao v. Subbaramaiah(),. The first question to be considered in these appeals is whether {here was an oral agreement between the Ist respondent wei on the. of the firm except the uit for sale of their shares on Say 6, 1952 and wi nL Tespondent No. 1 was entitled to Eg specific performance of tha oral agrecment. It was the case of respondent No, 1 that on July 6, 1952 ‘there was a miceti mey was also to be settled later. Tt’ was further agreed that the sale deeds In pursuance of the agreement all the fi Gants 1 t0 9 executed sate deeds and the plain” therefore became eG nat, &s tespondent No. 1 himself. He deposed thar Pe i 5, 6 and 8, Sti Davata Rama Mobana Rao, Sti Addepalli Nages- wara Reo and Si u Stimannarayana respectively were pre- Sent at the meeting of the shareholders. He ‘also said that the first defendant, the son of the 2nd defendant, was there to tepre- seat the latter, and that Gopala Krishnaiah, son of the 3rd defen. H dant, and the 7th defendant (who represents the Sth and 6th defen- ‘ (0) (0987) 1 An. WR. 488,SRIRAMULU ¥. ASWATHANARATANA (Ramaswami, J.) 391 _ dants) and Aiavala Subbayya (husband of the 8th defendant and father of the 9th defendant) were prestnt when the agreement was settled. He added that the sate deed was to be executed ia three months and that draft Ex. A-6 was also pre- pared 2 or 3 days later. On ‘behalf of the appellant reference was made to Ex. B-1, the deposition of the first ‘respondent ia the previous suit, where he said that the agrecment was on July 1, 1952 and that he did not remember the names of the other persons present at the me except P.W. 8 Sri Subba Rao ‘Nayudu, Vice Presideat of a Bak. In ovr opinion, the discrepancy ig immatetial and the High Court was right in accepting the evid- ence of this witness as true, The evidence of respondent No. 1 is corroborated by P.W, 7 who said that except the women share- holders all other sharehiolders were present at the meeting 6, 1952 and the subject for consideration was the sale of the site ‘of the cinema theatre to respondent No. 1. He added that the price of the whole site was fixed at Rs. 67,500/- and that all the partners except the appellant agreed to ‘sell ‘away their shares. On Cehalf of the appellant reference was made to the counter-affida- vit, B-4 dated January 5, 1953 filed in interfocutory proceedings on behalf of P.W. 7, but there is no serious contradiction between the evidence of that’ witness in Ex. B-4 and the ‘evidence of P.W. Tin the present suit, The High Court was highly impressed with the evidence of P.W. 7 and we see no reason for taking a different view in regard to the credibility of this witness. P.W. 8 was iso present at the meeting on July 6, 1952. His evidence coro” Dorates that of respondent No. I. He said that the son of the + appellant was present at the meeting and the women shareholders were represented by some men on ‘their behalf, It is true that P.W. 8 is the cousin brother of respondent No. 1, but this can ‘be no ground in itself for rejecting his testimony. P.Ws 2 and 3 have also given imy corroborative evidence. P.W. 2, Sri D. Subba Rao is the Subordinate Judge of Bapatla, He deposed that the first respondent told him that there was an oral agree- ment for the purchase of the shares concluded in the first week of July, 1952. Exhibit A-22 dated July 9, 1952, a letter written by. P.W. 2 to respondent No. 1 supports the evidence of PW. 2 PW. 3, SiS, Narayana Rao. ¢ District Judge and a family friend of respondent No. 1 also testified that he was informed of the negotiations by the first respondent for purchasing the shares and he'was also told by the first respondent about the conclusion of the agreement. Exhibit A-26 dated July 14, 1952, a letter writ- ten by him to the first respondent, supports this evidence. P.Ws. 2 and 3 are highly respectable witnesses and the Tigh Court was right in taking the view that their evidence strongly corroborates the case of respondent No, 1 with reeard to the conclusion of the ement for sale on July 6, 1952. The evidence of respon"392° SUPREME COURT REPORTS 11981] sen “&k dent No. 1 is also corroborated by the evidence of P.Ws. 5 am&6 Sci Devata Rama Moana Rao and Sri Addepalli Nageswara Bo which has been believed by the High Court, On bebalf of tie appellant it was said that respondent No, 1 has not given any reason in the plaint or in the evidence as to why 2 writtcn agrec- ment was not entered into. There may be some force in this we tppeals, argument. But no such question was put to P.W. 1 in cross B eause th examination, nor was he asked to give any explanation. On the spent OF other hand, there ate important circumstances indicating that the - not acts case of the first respondent with regard to the oral agreement is highly probable. In the first place, respondent No. 1 had built a valuable cinema theatre building on the disputed site and be hac very strong reasons to make an outright purchase of the site ¢ otherwise he would be placed in a precarious legal position. Negotiations for purchase were going on for several years past and considering this background, the case of the first respondent with regard to the oral agreement appears highly probable. P.W. 2. a Subordinate Judge and P.W, 3, a District Judge have both given evidence which corroborates the case of respondent No. with D “regard to the conclusion of the oral agreement on July 6, 1952 and there is no reason suggested on behalf of the appellant for discarding their evidence. its also important to notice that 20 out of 30 shareholders executed sale deeds in'favour of the firs: e respondent after the date of the alleged oral agreement on July 6, 1952. The fact that the shareholders sold their shares at the identical price to the first respondent and the others sold at the © same price to the appellant is only explicable on the hypothesis that the price was fixed by agreement between all the sharcholders willing to sell i.., sll those other than the appellant. The last of the sale deeds executed in favour of the appellant or the first res- pondent are Exs. A.11 and A-12 dated February 28, 1953. There is evidence that ‘prices were rising meanwhile and therefore the r. circumstance that the vendors chose to sell at the same price renders it highly probable that there was an earlier binding agree- ment. It is also an important circumstance against the appellan: that none of the women shareholders has appeared in the witness wm box to rebut the evidence tendered on behalf of respondent 'No, 1. AB There was evidence given on behalf of respondent No. 1 thet the women partners had authorised the men partners to represent them at the meeting but none of the women partners entered the witness e box to deny such authorisation. On behalf of ihe appellant reli- ance was placed upon the circular jeter, Ex. A-15 purported to be written by one Gopi Seti Venkata Subba Rao, one of the Shareholders, ‘The document is not signed by respondent No. 1. Hi appears to be a notice prepared by one of the shareholders to ‘be circulated inter se among them and refers to the mode of pay- ment of the purchase money agreed to between respondent No. 1a SRIRAMULU y, ASWATHANARAYANA (Ramaswari, J.) _ 393 and the persons selling the shares. ‘The High Court has observed five. ‘The mere omission to setile the mode of payment does no" cass of respondent No. 1 and we see no reason to take # dffierent view as regards the effect of Ex. A-13. We proceed to consider the next question raised in these appeals, namely whether the oral agreement was inelfective be- cause the parties contemplated the execution of a formal docu- ment or because the mode of payment of the purchase moucy was not actually agreed upon, It was submitted on behalf of the apps- tant that there was no contract because the sale was conditional upon 2 regular aereement being executed and no such agreement was executed. We do not accept this argument as correct. It ig well-established that a mere reference to a future formal cou~ tract will not prevent a binding bargain between the parties. The fact that the parties refer to the preparation of an agreement by which the terms agreed upon are to be put jn @ more mal shape does not prevent the existence of a binding contract. There are. however, cases where the reference to 2 contract is made in such terms as to show that the parties did not intend to be bound until 2 formal contract is signed. The question depends upon the intention of the parties and the special circumstances of each particular case. As observed by the rd Chancellor (Lord, Cranworth) in Ridgway v. Wharton(?) Qe tact of a subsequeni|| | _agreement being prepared may be evide that the previous nego- tiations did not amount to a concluded agreement) but the mere fact that persons wish 19 have a formal agrecment frawn up docs not establish the proposition that they cannot be bound by a pre- vious agreement. In Yon Hatzfeldt-Wildenburg v- Alexander(*) it was stated by Parker, J. as follows : “It appears to be well settled by the autho ities that if the documents or letters relied on as constituting a contract contemplate the execution of a further con- tract between the parties, it is a question of construc- tion whether the execution of the further conract is 8 condition or term of the bargain or whether it is a mere expression of the desire of the parties as to the manner in which the transaction already agreed to will in fact go through. In the former case there is no enforceable contract cither because the condition is unfulfilled or because the law dors not recognize a contract to enter into a contract, In the latter case there is a binding contract and the reference to the more formal document may be ignored.” . Jn other words, there may be a case where the signing of a further: formal agreement is made a condition or term of the ‘bargain, and (1D) 6 HALSC, 238, 263. (2) 1983} 1 Ch. 384, 2K,1 394 SUPREME COURT REFORTS 11968] 3 scr. if the formal agreement is not approved and signed there is ro concluded contract, In Rossier v. Miller(!} Lord Cairns said = “If you find not an unqualified acceptance subject to the condition that an agreement is to be prepared and agreed upon between the parties, and until that condi- tion is fulfilled no contract is to arise then you cannot find a conctuded contract.” In Currimbhoy and Company Lud. v. Creer(*) the Judicial Com- mittee expressed the view that the principle of the English law which is summarised in the judgment of Parker, J. in Von Hatz- jeldt-Wildenburg v. Alexander(*) was be applicable in India, The question in the present appeals is whether the execution of a for- mal ag ent Was “intended fo be W COHATUOH OF Tie bargain dated July 6, 1952 or whether it was 2 mere expression of the desire of the parties for a formal agreement which can be ignored. The evidence adduced on behalf of respondent No. 1 does not show that the drawing up of a written agreement was a pre-requisite to the coming into effect of the ‘oral agreement, It is therefore not possible to.accept the contention of the appellant that the oral agreement was ineffective in law because there is 20 execution of any formal written document, As regards the other point, it is true that there is no specific agreement with regard to the mode of payment-but this does not necessarily make the agreement ineffec- tive. e Mere omissivn to settle the mode of payment does not affect the completeness of the contract because the vital terms of the contract like the price and of the land and the time for completion of the sale were ail (We accordingly hold that Mr. Gokhale is unable to make is argument on this aspect of the case. We shall next deal with the question whether the appellant was a bona fide purchaser for value without notice of the prior oral agreement. The first stle deed obtained by the appellant was on July 29, 1952. P.W. 2 stated in his evidence that the appellant told him that he had been aware of the agreement in favour of respondent No. I at the time of the purchases under Exs. B-6 to B-10. It js true that P.W. 2 added that the appellant did not say distinctly that he was aware of the agreement between the respondent and defendants 1 to 9. Upoa this point the appel- + lant himself was unable to remember whether he had told P.W. 2 to that effect. In any case, P.Ws, 5 and 6 deposed thet they went to the appellant on July 7, 1952 and asked him to part with ‘his shares in favour of respondent No. 1. It is not denied by the appellant that he met P.Ws. 5 and 6 on July 7, 1952, Tr is also FAC 12, @) GLA, 297. @ [1917] 1 Ch. 2s,ist seer ate is no us said : ject and adi Ot A SRIRAMULU v. ASWATHANARAYANA (Ramaswami, 3.) 396 significant that the purchase money paid by the appellant was vers early the same as that payable wider the agreement in Pept dent No, 1's favour. On the basis of his evidence the High Court reached the conclusion thet the appellant had notice of the prior oral agreement. We see no reason 10 iiffer from the finding of thai the High Court ought not 1o have the site upon which lotied to, the share of res allot te thore was no equity t 3 He a 7863) when respondent No. 1 himself invoked the provisions of 5, 2 of that Act. Tt was also argued that the High Court had no jurisdiction to modify any portion of the judgment dated March 25, 1960 by a subsequent order dated June 21, 1960 without an application for review. In our opinion, the ‘contention pat for- ward on behalf of the apy tis well-founded and since ne ication was made on of the first respondent under s. 2 The Partition Act we are of opinioa that the following direction Of the High Court inthe preliminary deoree should be deleted: “cy “That the lower Court shall as for as possible allot to the appellant the site upon which the appellants’ ‘puildings stand ‘and further direct that if that procedure cannot be adopted conveniently or equitably ihe proce: dure laid down in the judgment reported in 1957(2) ALWAR. page 488 be followed.” 1k will, of course, be open to the parties to make representations and for the High Court to give equitable directions in the allot nent of shares to be made in the final partition decree. : Subject to this modification, We affirm the judgment anc decree of the High Cour of Andbra Pradesh in A.S. Nos. 380 and 381 of 1956 dated March 25, 1960 and dismiss these appeals with costs-—there will be one hearing fee. Ge: . , Appeals dismissed. Ls5up,C.78—3199g Pees -28,000 per month ab alreadiy -don- firmed by. the Appellate Authediy in HLRA. No. 483 of 1978. In this wiew of the:matter, the onder in. LRA. We. 522 of 1978 is set aside and the revisia eti- tion is allowed and the order of the Bent Controller ig restored. Each party @ bear his own costs, Petition aHinved, ATR 1983 MADRAS 168 K, B. N. SINGH, C. J. AND PADMANABHAN, 5, H. G. Krishna Reddy and Co, Appel- M. M, Thimmish and another, 0. S, A. P. No 19 of 197%, Dj- 2-1- 1983." (A) Contract Act ( of. 1872), Sz 10, 7 ) — tion of 2 ‘Construct cont - Document contemplating execution of turther document — Condition, « term ‘of pargain and not 2 mere expression of desire of parties — Thete canno; be any eaforceable coutract. If a documen; which is entered into between two parties and which is relied Oa as constituting a contract lates the ition of a further regular ee Sera the parties, vit is a construction sequent agreement being prepared may be evidence that the previous negotia- fions did not amount to an agreement, but the mere fact that persons wish to a formal agreemen, drawn up dose ‘Rog establish the proposition that they , cannot be bound bya previous agree- ment. When there is a written document which is followed by further negotiations in the form of correspondence, the, en- tirety of the correspondence hes to’ be ‘| looked into to find out whether there “Against judgment of N.S - Rame- swemi, J., in ©, 5, No, 283 of LOTA, Dj. 3-2-1977. 2 BA/BA/A575/83/SSC. HL G, Krishna Bbetiaiy ae Co. v.-M.M.. Thimmiah Mad. 169 ‘has - heen .a° completed contract or Hot. ‘Case-law discussed, Paras 9, 19) He also returned the sum which nad ‘bean paid towards the advance of sale consideration, On 196-1972, A sold tho sit property t» © for a sum of Rupees 1,10,000, B filed svi. for specific perform. ance Of the agrenen, ef tale Where 2 receipt was execied by ‘tho Proposed vendor in fasmr of the pro- posed vandoe for certiin mount to- wards the agreed price of th: mle of suit property and under that recebs a regu- lar agreement of sale on a stamp paper to be executed within 15 duys from , the saiti recital being a condition of the hargain between ‘the parties “under the receipt he said receipt was not intended to be a can eluded contract, ‘Paras 21, 23, 24) (B) Specific Relief Ace (47 of 1963). S. 18 (c) — Scope — Suit for specific Pe a of contract — Fiainttff Teadiness and willimgness to perfam 7s fou fe [i i : £ that form d Where in a suit for specific performan¢ of a contract, th dence on prove that perform his part of the contract a such readiness and willingness continu till the date of s trom witness-box the Courts cannot fit thap the plaintiff has di ie enjoined on him under 8, 16:(c) of # Act entitling him to a decree far spect! performance, Case ‘law discussed, “ + Parad 29, Er Ba é g