2020 Supreme(SC) 585

SUPREME COURT OF INDIA
R.F. NARIMAN, NAVIN SINHA, JJ.
Ferrodous Estates (Pvt.) Ltd. - Appellant
Versus
P. Gopirathnam (Dead) & Ors. - Respondents
Civil Appeal No. 13516 of 2015
Decided On : 12-10-2020

IMPORTANT POINTS
(1) Suit for specific performance filed within limitation cannot be dismissed on sole ground of delay or laches. Mere escalation of land prices after date of filing of suit cannot be sole ground to deny specific performance.
(2) Appeal is continuation of suit as a result of which a change in law will become applicable on the date of appellate decree provided that no vested right is taken away thereby.

Headnote:

(A) Appeal – Appeal is continuation of suit as a result of which a change in law will become applicable on the date of appellate decree provided that no vested right is taken away thereby – An appellate proceeding is in continuation of an original proceeding – Once a decree passed by a court had been appealed against the matter became subjudice again and thereafter appellate court acquired seisin of whole case, except where decree was regarded as final and court below retained jurisdiction.. (Paras 24 and 25)

(B) Specific Relief Act, 1963 – Section 20 – Specific Performance of Contract – Jurisdiction to decree specific performance is discretionary but that this discretion is not arbitrary but has to be exercised soundly and reasonably, guided by judicial principles, and capable of correction by a court of appeal – Mere escalation of land prices after date of filing of suit cannot be sole ground to deny specific performance – Mere delay by itself, without more, cannot be sole factor to deny specific performance – If property prices have risen dramatically within a period of two and a half years before filing of suit for specific performance and it is coupled with violation of agreement by plaintiff, specific performance will not be decreed – Where time can be said to be of essence in facts of a given case and purchaser does not take steps to complete sale within stipulated period and vendor is not responsible for any delay, steep rise in price within stipulated time would be a circumstance which would make it inequitable to grant relief of specific performance. (Paras 28, 29 and 30)

(C) Agreement to Sell – Suit for Specific Performance – Suit for specific performance filed within limitation cannot be dismissed on sole ground of delay or laches – However, an exception to this rule is where immovable property is to be sold within a certain period, time being of essence and it is found that owing to some default on part of plaintiff, sale could not take place within stipulated time – Once a suit for specific performance has been filed, any delay as a result of Court process cannot be put against plaintiff as a matter of law in decreeing specific performance – However, it is within discretion of Court, regard being had to facts of each case, as to whether some additional amount ought or ought not to be paid by plaintiff once a decree of specific performance is passed in its favour, even at appellate stage – In present case, Defendants were held to have taken up dishonest pleas and also held to have been in breach of a solemn agreement in which they were to obtain Urban Land Ceiling permission which, if not obtained, would, under the agreement itself, not stand in way of specific performance of agreement between parties – He who asks for equity must do equity – Given conduct of defendants, as contrasted with conduct of appellant who is ready and willing throughout to perform its part of bargain, it is a fit case in which the Division Bench judgment should be set aside – Decree passed by Single Judge restored – Since appellant itself offered a sum of Rs.1.25 Crores to Division Bench, it must be made to pay this amount to respondents within a period of eight weeks. [Tamil Nadu Urban Land (Ceiling & Regulation) Repeal Act, 1999] (Paras 31 and 32)

Facts of the case:

Agreement for sale of property. Present appeal arises from a suit for specific performance that was filed by the appellant-plaintiff against four defendants who are today represented by respondents.

Findings of Court:

Defendants were held to have taken up dishonest pleas and also held to have been in breach of a solemn agreement in which they were to obtain Urban Land Ceiling permission which, if not obtained, would, under the agreement itself, not stand in the way of the specific performance of agreement between the parties. He who asks for equity must do equity. Given the conduct of the defendants in this case, as contrasted with conduct of the appellant who is ready and willing throughout to perform its part of the bargain, we think this is a fit case in which the Division Bench judgment should be set aside.

Result : Civil Appeal allowed.