In a landmark ruling, the Supreme Court reinstated the trial court’s judgment in the case of O.S. No.226 of 1998. This judgment carries weight in matters related to specific performance of contracts and equitable reliefs. The restoration of the trial court’s decision marks a pivotal moment in Indian legal proceedings, ensuring justice in the case involving parties as per the agreement dated 07/06/1993. #SupremeCourt #LegalJudgment #IndianLaw
Facts
- Defendant denied the sale transaction and alleged that the agreement was forged by a person related to the plaintiff.
- Plaintiff claimed that the defendant agreed to sell the property for Rs.705/- per cent and received an advance of Rs.2,005/- on the same day.
- An additional sum of Rs.17,000/- was paid by the plaintiff to the defendant on 23.06.1993.
- Plaintiff filed a suit for specific performance of the agreement dated 07.06.1993 as the defendant postponed the sale deed execution despite demand.
- Defendant contended that the legal notice sent by the plaintiff was replied to.
- Defendant prayed for dismissal of the suit.
- Defendant filed second appeal S.A No.1282 of 2008
- Plaintiff was directed to pay additional sale consideration in part, twice the sale consideration stipulated under the agreement
- Appellate court reversed trial court findings and decreed specific performance in favor of plaintiff
- Trial court rejected claim for specific performance and ordered refund of Rs.37,436.80 with 24% interest per annum
- Unsuccessful plaintiff filed appeal against judgment and decree of trial court
Also Read: Anwar Ahmad vs State of U.P.: Interpretation of ‘Forthwith’ in Seizure Reporting Obligations
Issue
- Whether the impugned order of the High Court needs to be affirmed or reversed.
Also Read: Legal Analysis: Priyanka Jaiswal vs. State of Jharkhand – Quashing of Proceedings
Arguments
- Trial court rejected the prayer for specific performance based on evidence.
- Appellate court is criticized for interfering with trial court’s findings.
- Plaintiff failed to prove readiness and willingness to perform the contract.
- Agreement was considered canceled due to non-payment of balance sale consideration on time.
- The obligation to pay balance sale consideration did not arise until the land was surveyed and measured.
- Appellant’s senior counsel seeks dismissal of the suit, citing these reasons.
- Plaintiff has sufficiently proved readiness and willingness.
- Defendant did not question plaintiff’s readiness and willingness.
- Reply to legal notice was furnished after 5 months by the defendant.
- Defendant never cancelled the agreement.
- Counsel for the plaintiff seeks dismissal of the appeal.
Analysis
- The plaintiff remained silent and inactive for an extended period after the agreement was executed, failing to take any steps towards performance.
- No evidence was presented to show that the plaintiff demanded the agreed-upon survey of the land within a reasonable time.
- A legal notice expressing readiness to proceed with the transaction was issued after a significant delay of nearly two years from the expiration of the one-year period specified in the agreement.
- The plaintiff did not adequately demonstrate readiness and willingness to perform his part of the contract.
- The courts found that the plaintiff’s inaction for 2 1/2 years was not in line with the terms of the agreement, a requirement for specific performance relief.
- While the plaintiff proved financial capacity by paying part of the sale consideration, his conduct did not demonstrate willingness to perform the contract promptly.
- The conduct of the plaintiff, including delayed actions and lack of assertiveness in finalizing the agreement, was not consistent with the requirements for obtaining specific performance relief.
- Execution of Agreement to Sell on 07/06/1993.
- Additional Rs. 17,000/- consideration paid on 23/06/1993.
- Last date to get the sale deed registered as per Katta Sujatha Reddy v. Siddamsetty Infra Projects (P) Ltd & Ors (2023) 1 SCC 355.
- The defendant was required to survey the suit land as per the agreement.
- The total consideration was to be settled after the survey.
- Plaintiff claims defendant never surveyed the land.
- Plaintiff’s pleadings and evidence are silent on steps taken by the plaintiff.
- Specific performance of a contract cannot be enforced in certain circumstances as per Section 16 of the Specific Relief Act.
- These circumstances include when the person seeking enforcement would not be entitled to compensation for breach, is incapable of performing, violates essential terms, acts fraudulently, or acts against the intended relation of the contract.
- The plaintiff must prove readiness and willingness to perform the essential terms of the contract.
- In cases involving payment of money, the plaintiff need not tender the money unless directed by the court.
- The plaintiff must allege performance or readiness to perform the contract as per its true construction.
- The delay and silence of the plaintiff in explaining the delay did not entitle them to a decree of specific performance.
- The trial court denied the equitable relief due to the unexplained delay, a decision which was reversed by the appellate court without proper reasons.
- The plaintiff’s filing of the suit for specific performance on the verge of limitation did not entitle them to the equitable relief as per the decision in Rajesh Kumar Vs. Anand Kumar and Ors.
- The appellant succeeded in the appeal as the plaintiff was not entitled to the equitable relief due to lack of explanation for the delay.
- The steps taken by the plaintiff from the date of agreement till the filing of the suit needed to be explained in the plaint and proved in evidence, which was lacking in the present case.
Decision
- The impugned judgment of the High Court and the First Appellate Court is set aside.
- The judgment of the trial Court dated 19.01.2002 passed in O.S. No.226 of 1998 is restored.
- The appeal is allowed with no order as to costs.
Case Title: PYDI RAMANA @ RAMULU Vs. DAVARASETTY MANMADHA RAO (2024 INSC 507)
Case Number: C.A. No.-000434-000434 – 2013
