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SUPREME COURT OF INDIA
DHANANJAYA Y. CHANDRACHUD, CJI., J.B. PARDIWALA, MANOJ MISRA, JJ.
M/s Siddamsetty Infra Projects Pvt. Ltd. – Petitioner
Versus
Katta Sujatha Reddy & Ors. – Respondents
Review Petition (C) No. 1565 of 2022 in C.A. No. 5822 of 2022 And With Review Petition (C) No. 1839 of 2024 in C.A. No. 5823 of 2022
Decided On : 08-11-2024
(A) Civil Procedure Code, 1908 – Order XLVII Rule 1 – Supreme Court Rules, 2013 – Order XLVII Rule 1 read with Article 137 of Constitution of India – Review Jurisdiction – Invocation of – Discovery of new and important matter or evidence, which after exercise of due diligence was not within knowledge or could not be produced by them at the time decree was passed – Review proceedings are not by way of appeal and have to be strictly confined to scope and ambit of Order 47 Rule 1 CPC – Error on face of record must be an error which must strike one on a mere perusal and must not on a long drawn process – Power of review must not be exercised on the ground that decision was erroneous on merits – Mere possibility of two views on the subject cannot be a ground for review. (Paras 18 and 19)
(B) Limitation Act, 1963 – Article 54 of Schedule – Agreement to sell – Suit for Specific Performance – Period of limitation of three years runs from date fixed for completion of performance – Where contract does not fix a date for performance of contract, in such situations, period of limitation runs from date when plaintiff has notice that defendant has refused performance. (Para 22)
(C) Specific Relief Act, 1963 – Sections 10 and 16(c) – Agreement to sell – Cases in which specific performance of contract enforceable – Specific performance of contract cannot be enforced in favour of person who fails to prove that he is ready and willing to perform essential terms of contract which are to be performed by him, other than terms which are prevented or waived by defendant – Petitioner was ready and willing to perform contract in terms of Section 16(c) of Specific Relief Act – It cannot be concluded that petitioner was not ready or willing to perform his part of contract merely because balance sale consideration was due to be paid. (Paras 34 and 41)
(D) Transfer of Property Act, 1882 – Section 52 – Lis Pendens – Doctrine of lis pendens that Section 52 of Transfer of Property Act encapsulates, bars transfer of suit property during pendency of litigation – Only exception to the principle is when it is transferred under authority of court and on terms imposed by it – Where one of parties to suit transfers suit property (or a part of it) to a third-party, latter is bound by result of proceedings even if he did not have notice of suit or proceeding – Purpose of lis pendens is to ensure that process of court is not subverted and rendered infructuous – In absence of doctrine of lis pendens, defendant could defeat purpose of suit by alienating suit property – Section 52 of T.P. Act would apply to third-party purchaser once sale was executed after review petition was instituted before Supreme Court – Any transfer that is made during pendency of litigation is subject to final result of litigation. (Paras 47 and 49)
Facts of the case:
Petitioner has instituted proceedings under Article 137 of Constitution read with Order XLVII Rule 1 of Supreme Court Rules, 2013 seeking review of judgment of a three-Judge Bench of this Court dated 25th August 2022. By the judgment, this Court allowed appeal against judgment of High Court of Telangana dated 23rd April 2021 by which suit for specific performance was partially decreed by directing registration of suit property in favour of petitioner proportionate to extent of consideration paid. Issue for consideration of this Court is whether judgment of this Court dated 25th August 2022 suffers from error apparent on face of record which warrants exercise of review jurisdiction.
Findings of Court:
Having concluded that errors apparent on face of record identified above go to root of reasoning on both issues of limitation and specific performance, judgment of this Court dated 25th August 2022 recalled and Judgment of High Court dated 23rd April 2021 restored.
Result : Review Petitions allowed.
JUDGMENT :
Dhananjaya Y. Chandrachud, CJI.
| Table of Contents | |
| A. | Background |
| B. | Judgments of the Trial Court, High Court and this Court |
| C. | Submissions |
| D. | Grounds for exercising review jurisdiction |
| E. | Limitation |
| F. | Specific performance |
| G. | Lis pendens |
| H. | Relief |
1. The petitioner has instituted proceedings under Article 137 of the Constitution read with Order XLVII Rule 1 of the Supreme Court Rules 2013 seeking a review of the judgment of a three-Judge Bench of this Court dated 25 August 2022. By the judgment, this Court allowed the appeal against the judgment of the High Court of Telangana dated 23 April 2021 by which the suit for specific performance was partially decreed by directing the registration of the suit property in favour of the petitioner proportionate to the extent of the consideration paid. The issue for the consideration of this Court is whether the judgment of this Court dated 25 August 2022 suffers from an error apparent on the face of the record which warrants the exercise of the review jurisdiction.
A. Background
2. On 19 March 1994, Shri Debbad Narayana, Shri Vishweswara Rao (represented by the tenth to twelfth respondents who are his legal representatives), the third respondent, fourth respondent and fifth respondent (“original owners”) entered into an agreement to sell a land admeasuring 127.29 acs to the first, second, sixth, seventh and eight respondents (“vendors”). On the date of the agreement, possession to the extent of 65.23 acs was delivered to the vendors. Upon the payment of the balance sale consideration, the possession of the entire property was delivered. A sale deed was not executed, though the full sale consideration was paid. However, on 28 March 1994, an irrevocable power of attorney was executed in favour of the vendors.
3. On 26 March 1997, the vendors executed an agreement to sell in favour of the petitioner. This agreement will be referred to as the “first agreement to sell”. By the agreement, the first and the second respondents offered to alienate the scheduled property of 38.15 acs,1[“All that the agriculture land bearing Sy. Nos. 301 part, 302, 303, 304 part totally admeasuring Ac. 38-15 guntas situated at Budwel village, the then Hyderabad West Tq., now Rajendernagar Mandar, R.R. District, which is bounded by as under:-
East: Sy. No. 381, 380 and 326
West: Sy. No. 54 Village boundary of Irsalgandi
North: Sy. No. 381, 380 and 326
South: Sy. No. 300 and 306”] for a sale consideration of Rs. 38,37,500. The agreement notes that the petitioner paid a sum of Rs. 5,30,000 in cash and Rs. 6,00,000 in cheque as advance and earnest money. The relevant clauses of the agreement to sell are extracted below:
[…]
6. The parties of the first part and the parties of the second part herein undertake that they will execute a registered sale deed or deeds or any other nature of documents as desired by the purchaser in favour of the purchaser or its nominee or nominees, after receiving the balance sale consideration.
[…]
20. The parties of the first part and the second part herein undertake to execute the documents either registered or un-registered as desired by the purchaser after receiving the balance sale consideration to the extent
(1) Lis Pendens – Purpose of lis pendens is to ensure that process of court is not subverted and rendered infructuous – Section 52 of T.P. Act would apply to third-party purchaser.(2) Review Jurisdic....
(1) Agreement to sell – When a condition of a contract is breached and consequences ensue for that breach, a party cannot claim equity to escape such consequences.(2) It is nature of amendments which....
Appellate courts must uphold trial court findings unless explicitly challenged; sales during ongoing litigation violate the principle of lis pendens.
The doctrine of lis pendens under Section 52 prohibits transfers during the pendency of litigation, preventing subsequent purchasers from defeating a plaintiff's rights if they acquired property post....
Time is of the essence of a contract if the parties have agreed that it is or if the circumstances of the case show that it is.
The doctrine of lis pendens overrides the rights of bona fide purchasers when they acquire property during pending litigation concerning the same property, as established by case law.
Agreement to sell – Suit for Specific Performance – Once sale agreement is proved and subsequent sale was during pendency of suit hit by doctrine of lis pendens, decree for specific performance can b....
Agreement to Sell – Suit for Specific Performance – There is distinction between limitation and delay and laches.
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