Law: Contract, Act, 1872

Section: S. 55-Time

(a) Contract Act (IX of 1872),   S. 55-Time, whether of essence of contract-Balance of auction price stipulated to be paid within three months of date of intimation of sanction of Port Trust and Government-Will not by itself make time essence of contract Contract of sale of immovable property - Time specified for completion of sale-Time not of essence-Presumption that sale will be completed within a reasonable time.   The document, signed soon after the auction, contained a condition that balance of the purchase price remaining due after the initial deposit by the purchaser of 25% of such price, was payable within three months from the date of intimation of the sanction of the Port Trust Board (seller) and of the Government, of the auction, failing which the deposit of 25% was to be forfeited. The conditions of sale did not lay down expressly that time was of the essence of the contract. The acceptance of the pur chaser's bid which was subject to the sanction of the Port Trust Board and of the Government, was delayed and not communicated to the purchaser until about 5 months after the auction:   Held, that the purchaser's failure to pay the balance within the stipulated three months, did not of itself make time of the essence of the contract.   In a contract of sale of immovable property even though time is specified for the completion of the sale the presumption is that the parties really intended that this should be done within a reasonable time unless, a contrary intention appears from the circumstances of the case or from an express stipulation.   Jamshed Khodaram Irani v. Burjorji Dhunjibhi A I R 1915 P C 83 ref.   (b) Contract Act (IX of 1872);   S. 55 -Performance of contract-Reasonable time-Time not of essence-Two extensions granted by seller to purchaser to pay up balance of price of land Seller declaring forfeited initial of 25 % of price after giving further time to purchaser-Held, purchaser was not ready and willing to perform his part of contract "in this reasonable time.."   (c) Contract Act (IX of 1872),   S. 74-"Earnest money", what is-Not distinguishable from…