Point of Law: It is well settled that remedy for specific performance is an equitable remedy. The court while granting decree of specific performance exercises its discretionary jurisdiction. Section 20 of Specific Relief Act specifically provides that Court's discretion to grant decree of specific performance is discretionary but not arbitrary.

JUDGMENT :

Aggrieved by the judgment and decree dated 04.01.2007 in O.S.No.112 of 2003 on the file of II Additional Senior Civil Judge, Nellore, defendant in the suit filed the above appeal.

2. For the sake of convenience, parties to this appeal are referred to as they were arrayed in suit.

3. Plaintiff filed the suit O.S.No.112 of 2003 seeking specific performance of agreement of sale dated 24.01.2003.

4. Averments in the plaint, germane to decide the appeal, in brief, are as follows:

Plaintiff entered into an agreement of sale with defendant on 24.01.2003 for a total consideration of Rs.7,60,000/- and paid an advance of Rs.25,000/- on the same day. As per the terms and conditions of the agreement of sale, plaintiff had to settle the amount due to Andhra Pradesh State Financial Corporation, Nellore (for short “APSFC”) under One-Time- Settlement (OTS) on behalf of defendant and the remaining amount was to be paid within three months from the date of agreement. Pursuant to the agreement, plaintiff paid an amount of Rs.50,000/- to APSFC on 17.03.2003 towards due amount and obtained receipt. The time stipulated under agreement of sale is three months from 24.01.2003, however by mistake it was recited in the agreement of sale, in figures as 23.03.2003, though in words it was mentioned as three months. Plaintiff is always ready and willing to perform its part of contract by clearing all the dues payable to APSFC. Though it was recited in the agreement of sale that defendant on payment should get valid conveyance from APSFC, enquiries of plaintiff revealed that APSFC would not give valid conveyance in respect of suit schedule property straightaway in favour of plaintiff. Thus, plaintiff requested the defendant to perform his part of contract three days prior to 27.03.2003, but defendant evaded to do so. On 28.03.2003, defendant unilaterally, without knowledge and consent of plaintiff, paid Rs.2,90,000/- to APSFC under OTS scheme and tried to evade his part of contract. Plaintiff got issued legal notice dated 27.03.2002 to defendant and filed the suit for the reliefs stated supra.

5. Defendant filed written statement. The contents, in brief, in the written statement are that plaintiff had no capacity to pay balance of sale consideration and he is never willing to perform his part of contract. Defendant offered to sell the schedule property with a specific understanding that plaintiff had to pay entire sale consideration on or before 23.03.2003 and to clear debt due to APSFC by availing OTS benefit. Defendant denied payment of Rs.50,000/- to APSFC on 17.03.2003 and also with regard to date mentioned in words in agreement. Defendant further contended that when authorities of APSFC issued letter dated 06.03.2003 calling upon him to settle the outstanding amount together with future interest and to close loan by 15.03.2003, plaintiff is not ready and willing to perform its part of contract and in fact had no capacity to pay balance amount. Defendant with the help of his partners cleared the loan by getting benefits under OTS and eventually prayed court to dismiss the suit.

6. Basing on the pleadings, Trial Court framed the following issues:

(1) Whether the plaintiff is entitled for specific performance of the contract in pursuance of the agreement of sale dated 24.01.2003?

(2) To what relief?

7. During the trial, Managing Director of plaintiff examined himself as P.W.1 and Exs.A-1 to A-4 were marked. Defendant examined himself as D.W.1 and got marked Ex.B-1.

8. By judgment dated 04.01.2007, trial Court decreed the suit with costs, directing the defendant to execute a registered sale deed in favour of plaintiff in respect of schedule property by receiving balance sale consideration of Rs.6,85,000/-, failing which, plaintiff is at liberty to obtain the same through process of Court. Assailing the same, the present appeal is filed.

9. Heard Sri M.V.S.Suresh Kumar, learned senior counsel appearing for Sri A.Srinivasa Rao learned counsel appearing for