# Pfii/ip lnlm Fla!kei Thomas v. Commiuionf!r of Income-tax, Ca'c111ta

- **Citation:** [1964] 2 S.C.R. 495
- **Court:** Supreme Court of India
- **Decided:** 1964
- **Bench:** B. P. Sinha, J.C. Shah, N. Rajagopala Ayyangar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/pfii-ip-lnlm-fla-kei-thomas-v-commiuionf-r-of-income-tax-ca-c111ta-2940
- **Pages:** 6

## Headnote

Specific performance'-Contract to sell house propertyImplied t•rm-Poi11ts not raised in the High Court, if be allowed
for the first time in this Court.
The plaintiffs-respondents entered into a contract of sale
in respect of a house property belonging to the appellant. The
deed of agreeuient provided that the vendor shall obtain the
pt"rmh.sion of the Chief Commissioner to the transaction of
sale within two months of the agreement and if the sairl
permission was not forthcoming within that time, it was open
to the purchasers to extend the date or to treat the agreement
as canceJlcd.
As the necessary permission was not forthcoming ~.vithin the stipulated time, the purchasers extended the
time by another month. The appellant withdrew her application for the necessary
permission. The defendant having
failed to perform
her part of the contrart, the plaintiffs
brought a suit for specific performance of the contract for sale or
in the alt<rnative for damages.
The trial court, althoug-h it
found that the plaintiffs had been throughout ready ani willing,
inderd anxiou-., to perform their part of the contract and that
it was the defendant who had backed out of it, refused the main
relief of specific performance of the contract on the ground that
the agreement was inchoate, as the previous sanction of the
Chief Com1nissioner to the proposed transfer had not been
obtained. The High Court came to the conclusion that there
1963
Pfii/ip lnlm Fla!kei
Thomas
v.
Commiuionf!r of
Income-tax, Ca'c111ta
Das J.
1961
A1.arch 25
1963
Ch,.ndritd WidJ·a
Vnli Afc~~n
v.
C. L. Kahal
5in.\o c. J.
496 SUPREME COURT REPORTS [1964] VOL.
was a completed contract between the parties and that the
condition in the agreement that the vendor would obtain the
sanction of the Chief Commiisioner to the transaction of sale
did not render the contract incomplete and the trial court was
in error in holding that the agre"ment was inchoate.
Held that on the findings in this case, the court had got
to enforce the terms of the con;.ract and to enjoin upon the
defendant·appellant to make the necessary application to the
Chief Commissioner, which was implied in the contract. It
will be for the Chief Commissioner to decide whether or not to
grant the necessary sanction.
In the event of the sanction
being refused, the plaintiffs shall be entitled to the damages
as decreed by the High Court.
In this view of the matter,
the High Court was entirely correct in decreeing the suit for
specific performance of the contract.
Motiwl v. Nanhelal (1930) L. R. 57 I. A. 33, referred to.
Held further, that the points not sprcifically raised in
the High Court
nor pleaded in the pleaclir.gs should not
be allowed for the first time to be raised in this Court.
C1vn, APPELLATE jt:RISDICTION : Civil Appeal
No. 559 of 1962.
Appeal from the judgment and decree dated
March 21, J!Hil, of the Punjab High Court (Circuit
Bench) at Delhi in Regular First Appeals Nos. 8 D
and 21-D of 1960.
A. Rnnganadham
Chetty, S. K. Mehta and
J(. L. J!ehta, for the appellant.
ilf. C. Setalvad, Hardayal H11rdy and S. N.
Anand, for the respondents.
HJ63. March 25. The Judgment of the Court
was delivered by
SINHA
C. J.-This appeal on a certificate
granted by the High Court of Punjab arises out of
a suit for specific performance of. a cont_raet. of sale
in respect of a house property situate m 1ughlak
Road
New Delhi, belonging to the appellant and
built ~n a lease-hold plot granted by the GO\·ernmrnt
-
-
,,
.-:
•.•
2 S.C.R.
SUPREME COURT REPORTS
497
in the year 1935, to her predecessor-in-title. It appears
that the plaintiffs entered into a contract of sale in
re<pect of the disputed
property for the sum of
R5. 1,10,000/-.
The deed of agreement is dated
September 4, 1956. In so far as it is necessary to
notice the terms of the document, the agreement
provided that the vendor shall obtain the permission
of the Chief Commissioner to the transaction of sale
within two months of the agreement, and if the said
permission was not f

## Text

2 S.C.R.
SUPREME COURT REPORTS
495
For the reasons given above we allow the
appeals and answer the question referred to the Hi!)h
Court in favour of the assessee.
The appellant will
be entitled to his costs in this court as also in the
High Court ; there will be one hearing fee.
Appeals allowed.
MRS. CHANDNEE WIDYA VATI MADDEN
v.
DR. C. L. KATIAL & OTHERS
(B. P. SINHA, C. J., J.C. SHAH and
N. RAJAGOPALA AYYANGAR JJ.)
Specific performance'-Contract to sell house propertyImplied t•rm-Poi11ts not raised in the High Court, if be allowed
for the first time in this Court.
The plaintiffs-respondents entered into a contract of sale
in respect of a house property belonging to the appellant. The
deed of agreeuient provided that the vendor shall obtain the
pt"rmh.sion of the Chief Commissioner to the transaction of
sale within two months of the agreement and if the sairl
permission was not forthcoming within that time, it was open
to the purchasers to extend the date or to treat the agreement
as canceJlcd.
As the necessary permission was not forthcoming ~.vithin the stipulated time, the purchasers extended the
time by another month. The appellant withdrew her application for the necessary
permission. The defendant having
failed to perform
her part of the contrart, the plaintiffs
brought a suit for specific performance of the contract for sale or
in the alt<rnative for damages.
The trial court, althoug-h it
found that the plaintiffs had been throughout ready ani willing,
inderd anxiou-., to perform their part of the contract and that
it was the defendant who had backed out of it, refused the main
relief of specific performance of the contract on the ground that
the agreement was inchoate, as the previous sanction of the
Chief Com1nissioner to the proposed transfer had not been
obtained. The High Court came to the conclusion that there
1963
Pfii/ip lnlm Fla!kei
Thomas
v.
Commiuionf!r of
Income-tax, Ca'c111ta
Das J.
1961
A1.arch 25
1963
Ch,.ndritd WidJ·a
Vnli Afc~~n
v.
C. L. Kahal
5in.\o c. J.
496 SUPREME COURT REPORTS [1964] VOL.
was a completed contract between the parties and that the
condition in the agreement that the vendor would obtain the
sanction of the Chief Commiisioner to the transaction of sale
did not render the contract incomplete and the trial court was
in error in holding that the agre"ment was inchoate.
Held that on the findings in this case, the court had got
to enforce the terms of the con;.ract and to enjoin upon the
defendant·appellant to make the necessary application to the
Chief Commissioner, which was implied in the contract. It
will be for the Chief Commissioner to decide whether or not to
grant the necessary sanction.
In the event of the sanction
being refused, the plaintiffs shall be entitled to the damages
as decreed by the High Court.
In this view of the matter,
the High Court was entirely correct in decreeing the suit for
specific performance of the contract.
Motiwl v. Nanhelal (1930) L. R. 57 I. A. 33, referred to.
Held further, that the points not sprcifically raised in
the High Court
nor pleaded in the pleaclir.gs should not
be allowed for the first time to be raised in this Court.
C1vn, APPELLATE jt:RISDICTION : Civil Appeal
No. 559 of 1962.
Appeal from the judgment and decree dated
March 21, J!Hil, of the Punjab High Court (Circuit
Bench) at Delhi in Regular First Appeals Nos. 8 D
and 21-D of 1960.
A. Rnnganadham
Chetty, S. K. Mehta and
J(. L. J!ehta, for the appellant.
ilf. C. Setalvad, Hardayal H11rdy and S. N.
Anand, for the respondents.
HJ63. March 25. The Judgment of the Court
was delivered by
SINHA
C. J.-This appeal on a certificate
granted by the High Court of Punjab arises out of
a suit for specific performance of. a cont_raet. of sale
in respect of a house property situate m 1ughlak
Road
New Delhi, belonging to the appellant and
built ~n a lease-hold plot granted by the GO\·ernmrnt
-
-
,,
.-:
•.•
2 S.C.R.
SUPREME COURT REPORTS
497
in the year 1935, to her predecessor-in-title. It appears
that the plaintiffs entered into a contract of sale in
re<pect of the disputed
property for the sum of
R5. 1,10,000/-.
The deed of agreement is dated
September 4, 1956. In so far as it is necessary to
notice the terms of the document, the agreement
provided that the vendor shall obtain the permission
of the Chief Commissioner to the transaction of sale
within two months of the agreement, and if the said
permission was not forthcoming within that time,
it was open to the purchasers to extend the date
or to treat the agreement as cancelled.
As the neces-
<ary permission was not forthcoming within the
stipulated time, the purchasers extended the time by
another month. The appellant had made an application to the proper authorities for the necessary
permission,
but withdrew her application to the
Chief Commissioner by her letter dated April 12,
19.57. The plaintiffs called upon the defendant several
times to fulfil her part of the agreement but she
failed to do so.
It was averred on behalf of the
plaintiffs that they had always been 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 contract for sale or in the alternative for damages
amounting to Rs. 51,100/-. The suit was conte,ted
on a large number of grounds of which it is necessary now to take notice only of the plea on which
issue No. 8 was joined. Issue No. 8 is as follows :
"(8) Is the contract contingent or impossible
of performance and is uncertain and vague
and is therefore void ?"
The other material issues were concurrently decided
in favour of the plaintiffs, and, therefore, need not
be referred to.
The trial Court in a very elaborate judgment
d'smissed the suit for specific performance of conuact
1953
Charidnee iv idy a
Vati Madden
v.
C. L. Katial
Sinhi C. J.
1963
Clu:ttdnu U'id.1.t
Va1; !t{odden
..
C. L. lrati41
Sinko C. J.
498
SUPREME COURT REPORTS [1964] VOL.
and for a pamanent injunction and decreed the
sum of Rs. 11,550/- by way of damages, with proportionate costs, against the defendant. Though the
Courl found that the plaintiffs had been throughout
ready and willing, indeed ·anxious. to perform their
part of the contract, and that it was the defendant
who backed out of it, it refused the main relief of
specific performance of the contract on the ground
that the agreement was inchoate in view of the fact
that the previous sanction of the Chief Commissioner
to the propo1ed transfer had not been obtained_
The High Court on appeal came to the conclusion that the agreement was a completed contract for
sale of the house in question, subject to the sanction
of the Chief Commissioner before the sale transaction
could be concluded, but that the Trial Court -was
in error in holding that the agreement was inchoate,
and that, therefore, no decree for specific performance
of the contract could be granted. The High Court
relied mainly on the decision of their Lordships of
the Judicial Committee of the Privy Council in
JJ!otila.l v. Km1helul (1), for coming to the conclusion
that there was a completed contract between the parties and that the condition in the agreement that the
vendor would obtain the sanction of the Chief Commissioner to the transaction of sale did not render the
contract incomplete_
In pursuance of that term in
the agreement, the vendor had to obtain the sanction
of the Chief Commissioner and as she had withdrawn
her application for the necessary sanction, she was
to blame for not having carried out her part of the
contract.
She had to make an application for th~
necessary permission. The High Court also po•ntcd
out that if the Chief Commissioner ultimately refused
to grant the sanction to the sale, the plaintiff may
not be ahlc to enforc~ the decree for specific ptrformancc of the contract but that was no bar to the
Court passing a decree for that relief.
Thou~h it
was not necessary in the view the High Court took of
(I) (1~30) L. R. S7 !. ,\. 331.
(
•
2 S.C.R.
SUPREME COURT REPORTS
499
the rights of the parties, it recorded a finding that
a sum of Rs. 5, 775/- would be the appropriate amount
of damages in the event of the plaintiffs not succeeding in getting their main relief for specific perfor·
mance of the contract.
The main ground of attack on this appeal is
that the contract is not enforceable being of a con·
tingent nature and the c0ntingency not having been
fulfilled. In our opinion, there is no substance in
this contention. So far as the parties to the contract are concerned, they had agreed to bind themselves by the terms of the document executed between
them. Under that document it was for the defendant-vendor to make the necessary application for
the permission to the Chief Commissioner. She
had as a matter of fact made such an application
but for reasons of her own decided to withdraw the
same. On the findings that the
plaintiffs have
always been ready and willing to perform their
part of the contract, and that it was the defendant
who wilfully refused to perform her part of the
contract, and that the time was not of the essence of
the contract, the Court has got to enforce the terms
of the contract and to enjoin upon the defendant·
appellant to make the necessary application to the
Chief Commissioner.
It will be for the
Chief
Commissioner to decide whether or not to grant the
necessary sanction.
In this view of the matter, the High Court
was entirely correct in decreeing the suit for specific
performance
of the contract. The High Court
should have further directed the defendant to make
the
necessary application for permission to the
Chief Commissioner, which was implied in
the
contract between the parties.
As the defendantvendor, without any sufficient reasons,
withdrew
the application already made to the Chief Commissioner the decree to. be prepared by this Court will
add the clause that the defendant, within one m01nh
1969
Clumdntf' Wit/~
Vati MatltJen
v.
C. L, Kaiial
Sin/IQ C. /.
1963
ChanJn,t U'iit)o
VaJi Ma'tWJ
v.
C. 1 .... KaJial
Sirth~ C. J.
500 SUPREME COURT REPORTS [1964] VOL.
from to day, shall make the necessary application to
the Chief Commissioner 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 to the
plaintiffs the property in suit.
In the event of the
sanction being refused, the plaintiffs shall be entitled
to the damages as decreed by the High Court. The
appellant sought to raise certain other pleas which
had not been raised in the High Court, for example,
that this was not a fit case in which specific performance of contract should be enforced by the Court.
This plea was not specifically raised in the High
Court and the necessary facts were not pleaded
in the pleadings.
It is manifest that this Court
should not _allow such a pica to be raised here for the
first time.
For the reasons given above, the appeal fails
and is dismissed with costs.
.Apptal dismis1ed.
•