Nathulal v Phoolchand

Facts

A transferee was put in possession under a written agreement to sell immovable property. He was to pay the balance of the purchase money after the revenue records were rectified by the vendor. The revenue records were not rectified, so the balance was not paid, and the transferee's willingness to perform was challenged when he sought protection of his possession under Section 53A.

Issues

• Whether the transferee in possession had performed or was willing to perform his part of the contract within the meaning of Section 53A.
• How readiness and willingness are to be assessed where the parties' obligations are reciprocal and sequential.

Arguments

The transferor contended that, the balance consideration being unpaid, the transferee was not willing to perform and could not invoke Section 53A. The transferee argued that his obligation to pay arose only after the vendor rectified the revenue records, which the vendor had failed to do.

Held

The Supreme Court held that in judging willingness to perform, the court must consider the respective obligations of the parties and the sequence in which they were to be performed. A buyer who was to pay the balance only after the revenue records were rectified could not be held unwilling merely because he did not pay when the records remained unrectified through the vendor's default. The transferee was accordingly entitled to the protection of Section 53A.

Ratio decidendi

The 'willingness to perform' requirement under Section 53A is to be assessed relative to the order of reciprocal obligations; a transferee whose performance is contingent on the transferor's prior act is not disentitled where the transferor has not done that act.

Significance

A foundational Supreme Court exposition of the 'readiness and willingness' element of part performance; routinely cited for the contextual, obligation-sequence approach to assessing the transferee's willingness.

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