IN THE HIGH COURT OF BOMBAY
Anil S.Kilor, J.
Sunil - Appellant
Versus
Sudhir - Respondent
Second Appeal No. 217 of 2015
Decided On : 20-04-2023
SPECIFIC PERFORMANCE - ORAL AGREEMENT - SPECIFIC RELIEF ACT, SEC. 20; EVIDENCE ACT - The court discussed the principles of specific performance under the Specific Relief Act, particularly Section 20, which grants judicial discretion in such matters. It emphasized the necessity for clear and certain evidence of an oral agreement for sale, as established in prior case law. The court found that the plaintiff failed to meet the burden of proof required to establish the existence of an oral agreement, leading to the conclusion that the appellate court erred in reversing the trial court's decision.
JUDGMENT/ORDER
1. This appeal takes exception to the judgment and decree dtd. 17/10/2014, passed by the Adhoc-District Judge-3, Nagpur in Regular Civil Appeal No. 343 of 2010, allowing the appeal and thereby setting aside the judgment and decree dtd. 20/4/2010 passed by the 3rd Joint Civil Judge, Senior Division, Nagpur, in Regular Civil Suit No. 1234 of 2004 (New Special Civil Suit No. 905 of 2007), dismissing the suit for specific performance.
2. The brief facts of the present case are as under : (The parties are referred to as per their status before the trial Court.) The respondent is the plaintiff who filed a suit for specific performance. It is the case of the plaintiff that he is a practicing Advocate at Nagpur. Defendant is also a lawyer. They had close friendship with one another. Defendant is an exclusive owner of suit block admeasuring carpet area 110 square feet.
3. It is stated that on 27/11/1991 defendant entered into oral agreement of sale of suit block with plaintiff for valuable consideration of Rs.70,000.00, in presence of their common friends. Having regard to the friendly relations, mutual understanding as well as in part performance of oral agreement, defendant put up plaintiff in physical possession of suit block on 28/11/1991. Since then plaintiff is running his office-cum-consultation chamber at suit premises.
4. Plaintiff contended that the defendant agreed upon to accept consideration amount in installments. Plaintiff paid him first five installments by cheque each of Rs.5,000.00. Thereafter for 17 times and in piece meal the plaintiff paid balance consideration amount to the defendant by cash.
5. The defendant acknowledged cash amount by signing against the same. Thus, entire consideration was of Rs.70,000.00 was paid to the defendant by plaintiff till 22/3/1998. Thereafter plaintiff, with the knowledge of defendant, carried out renovation of said block by spending Rs.45,000.00. Even defendant had also given extension of EPDAX of defendant's hotel to plaintiff's telephone.
6. Plaintiff was looking after various civil and criminal matters filed by the defendant and his family members before different Courts. During the said period, plaintiff came across with special civil suit no. 900 of 1994 and observed that entire "G-Building" was mortgaged to State Bank of India by way of collateral security to secure the cash credit facility of M/s Bild Fast Construction, a proprietary concern of defendant's younger brother Mr. Ramesh Ramchandra Mahajan. Said suit was compromised in the year 1988 before 2nd Joint Civil Judge, Senior Division, Nagpur but said encumbrance, by way of mortgage, was not removed by State Bank of India, Ramdaspeth branch by getting deed executed and by issuing no dues and no encumbrance certificate as defendant has not persuaded the said matter with the bank. It was issued some time in October and November, 2002.
7. The defendant was avoiding to execute the sale deed without any reason. Hence plaintiff issued request letter-cum-notice to the defendant on 24/5/2004 to convey suitable date for execution of sale deed of suit block in favour of plaintiff. Defendant replied the said notice which was received by the plaintiff on 10/6/2004, falsely claiming that plaintiff was tenant on monthly rent of Rs.2500.00 in the suit block. There was no oral contract of sale. Defendant also contended that he had accepted the amount from plaintiff towards interest free security deposit and rent. Hence, plaintiff had filed the suit.
8. The defendant/respondent filed his written statement denying the claim of the plaintiff. He admitted the ownership of suit block. He also admitted that plaintiff is in occupation of suit block as described by the plaintiff and using it as office-cum-consultation chamber. He admitted that he had received Rs.70,000.00 from plaintiff.
9. Defendant pleaded that since they had good relations and since plaintiff was looking after family litigation and near about 25 court cases, he had all
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AI
Point of law: specific performance of oral Agreement of sale – Not proved - In a case of specific performance of contract, a greater degree of certainty is required and it demands a clear, definite a....
Existence of a concluded oral agreement for sale, as evidenced by the preparation of a regular registered sale deed and the agreed sale consideration, is crucial in a specific performance case. Defen....
An oral agreement is valid for specific performance if made with free consent and lawful consideration, separate causes of action do not bar subsequent suits.
Substantial payment by the vendee is a robust factor in favor of granting specific performance.
Specific performance of oral sale agreement decreed reversing trial court; readiness/willingness proved by averments, letters, conduct without deposit; discretion adjusts consideration for property e....
A party alleging an oral agreement for sale must prove its existence and payment through substantive evidence; failure to do so can lead to dismissal of the suit.
The court upheld specific performance of a contract where the plaintiff proved payment despite the defendant's encumbrance issues, establishing that time was not of the essence in performance.
Plaintiff failed to establish valid contract and continuous readiness for specific performance under Specific Relief Act.
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