Law on Specific Performance | For purpose of passing a decree of specific performance, what is essential? SC explains

Supreme Court: Stating that readiness and willingness are necessary for the purpose of passing a decree of specific performance, Division Bench of M.R. Shah and A.S. Bopanna, JJ., expressed that,

Straightaway to rely upon the affidavit without amending the plaint and the pleadings is wholly impermissible under the law.

Factual Background

Plaintiff and the defendant entered into a sale agreement wherein the defendant agreed to sell the same for a sale consideration of Rs 16.20 lakhs to the plaintiff. A part sale consideration of Rs 3,60,001 was paid at the time of execution of the agreement to sell.

Amongst the number of conditions stipulated in the agreement to sell, one of the conditions was that the defendant as original owner was required to evict the tenants from the property in question thereafter to execute the sale deed on receipt of the full sale consideration.

In view of the above condition, plaintiff sent a legal notice to defendant asking to evict the tenants from the property in question and to execute the sale deed on receipt of balance sale consideration vide a notice.

Plaintiff approached the Trial Court for specific performance of the contract.

Plaintiff’s case was that he was ready and willing to perform his part of the contract, but the defendant did not evict the tenants and come forward to execute the sale deed.

Trial Court held that the plaintiff was not willing to get the sale deed executed as it is, and, therefore, held the issue of willingness against the plaintiff. Court also added that the defendant failed to prove that tenants had vacated the suit property as claimed, however, the Trial Court held on willingness against the plaintiff by observing that the plaintiff had not shown the willingness to purchase the property with the tenants.

In an appeal filed before the High Court under Section 96 read with Order XLI by the impugned judgment and order, High Court allowed the said appeal and quashed and set aside the decree passed by the Trial Court dismissing the suit and consequently had decreed the suit for specific performance.

On being aggrieved and dissatisfied with the decisions of the lower courts, defendant approached this Court.

Analysis, Law and Decision

Supreme Court noted the non-compliance of the Order XLI Rule 31 CPC passed by the High Court Order.

High Court disposed of the appeal preferred under Order XLI CPC read with Section 96 in a most casual and perfunctory manner. Court neither re-appreciated the entire evidence on record nor had given any specific findings on the issues which were even raised before the Trial Court.

In Court’s opinion, High Court failed to exercise the jurisdiction vested in it as a First Appellate Court. Hence, High Court’s decision was unsustainable.

As per the case of the original plaintiff, the defendant was required to evict the tenants and hand over the physical and vacant possession at the time of execution of the sale deed on payment of full sale consideration.

Procedure adopted by the High Court relying upon the affidavit in a First Appeal by which virtually without submitting any application for amendment of plaint under Order VI Rule 17 CPC, High Court as a First Appellate Court had taken on record the affidavit and as such relied upon the same, but the said procedure is untenable and unknown to law.

It was also observed that, there were no pleadings in the plaint that he was ready and willing to purchase the property and get the sale deed executed of the property with tenants and the specific pleadings were to hand over the peaceful and vacant possession after getting the tenants evicted and to execute the sale deed.

Bench also opined that the plaintiff was never ready and willing to purchase the property and/or get the sale deed executed of the property with tenants.

It was for the first time before the High Court in the affidavit filed before the High Court and subsequently when the learned Trial Court held the issue of willingness against the plaintiff, the plaintiff came out with a case that he is ready and willing to purchase the property with tenants. 

Further, the Court held that once it is found on appreciation of evidence that there was no willingness on the part of the plaintiff, the plaintiff was not entitled to the decree of specific performance.

Therefore, Trial Court’s decision was upheld.

Submission on behalf of the plaintiff that, in the agreement, a duty was cast upon the defendant to evict the tenants and to handover the vacant and peaceful possession, which the defendant failed and, therefore, in such a situation, not to pass a decree for specific performance in favour of the plaintiff would be giving a premium to the defendant despite he having failed to perform his part of the contract.

Defendant not refunding the amount of part sale consideration with 18% interest as ordered by the Trial Court cannot be a ground to confirm impugned judgment and order passed by the High Court.

The Court directed the appellant to refund the amount of Rs 3,60,001 with 18% interest from the date of agreement till the date of realization. [K. Karuppuraj v. M. Ganesan, 2021 SCC OnLine SC 857, decided on 4-10-2021]

Join the discussion

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.