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Issues: (i) Whether time was of the essence of the contract for payment of Rs. 75,000 on or before 30.9.1981 and whether the purchaser breached that term. (ii) Whether the purchaser had continuously been ready and willing to perform his obligations so as to satisfy the requirement for specific performance.
Issue (i): Whether time was of the essence of the contract for payment of Rs. 75,000 on or before 30.9.1981 and whether the purchaser breached that term.
Analysis: In contracts for sale of immovable property, time is ordinarily not of the essence unless the contract terms and surrounding circumstances clearly show such intention. The relevant inquiry is the intention of the parties, gathered from the express terms, the nature of the property, the nature of the contract, and the surrounding circumstances. On the facts, the original agreement did not show an intention to make time essential. The asserted oral arrangement extending the payment date was not rebutted by evidence. The vendors also extended the completion date up to 31.12.1981, which was inconsistent with a case of strict insistence on punctual payment. The notice making time essential was therefore not justified.
Conclusion: Time was not of the essence, and the purchaser cannot be treated as having committed the alleged breach.
Issue (ii): Whether the purchaser had continuously been ready and willing to perform his obligations so as to satisfy the requirement for specific performance.
Analysis: Under the governing law of specific performance, the purchaser must show continuous readiness and willingness to perform the contract and to keep it alive. The evidence showed that the purchaser acted consistently with an intention to complete the transaction, including tendering amounts within the extended timeline and promptly filing suit after termination. The vendors did not establish that the purchaser had abandoned the contract or that there was such default as to disentitle him to relief. The post-dated cheque and the surrounding conduct did not displace the finding that the purchaser was in a position to perform and remained willing to do so.
Conclusion: The purchaser satisfied the requirement of readiness and willingness under Section 16 of the Specific Relief Act.
Final Conclusion: The decree for specific performance was sustained and the vendors were not entitled to terminate the agreement on the ground of delay in payment.
Ratio Decidendi: In a contract for sale of immovable property, time is not ordinarily of the essence; a party seeking to make time essential must prove clear intention and justified circumstances, and a purchaser seeking specific performance must establish continuous readiness and willingness to perform.