IN THE HIGH COURT OF DELHI AT NEW DELHI
SURESH KUMAR KAIT, NEENA BANSAL KRISHNA, JJ.
Devenderjeet Singh Sethi - Appellant
Versus
Om Prakash Arora and Others - Respondents
RFA(OS) No.74 Of 2019, CM Appl. No.36005 Of 2019
Decided On : 19-04-2023
Specific Performance - Agreement to Sell - Sections 16(c), 20, 21, 22, 23 of the Specific Relief Act, 1963 - [KEYWORD] - Property Law - Sections 3 and 2(a) of Benami Transaction (Prohibition) Act, 1998 - [SUMMARY]
Fact of the Case:
The appellant filed a suit for Specific Performance of the Agreement to Sell and Permanent Injunction, claiming that he had entered into an Agreement to Sell for a property in Delhi. The respondents denied receiving the full payment and raised objections, including the claim that the transaction was a Benami transaction.
Finding of the Court:
The court found that the appellant failed to prove the payment of the full sale consideration and his readiness and willingness to perform the contract. The court dismissed the suit for Specific Performance and Permanent Injunction.
Issues: The issues included the entitlement to specific performance, readiness and willingness to perform the contract, entitlement for a decree of permanent injunction, payment of Rs. 45,00,000 in cash, and whether the transaction was a Benami transaction.
Ratio Decidendi: The appellant failed to prove the payment of the full sale consideration and his readiness and willingness to perform the contract, which are essential for specific performance. The court also considered the conduct of the appellant and the inconsistencies in his explanations.
Final Decision: The appeal and any pending application were dismissed by the court.
JUDGMENT :
(Neena Bansal Krishna, J.) :—
1. The appellant (who was the plaintiff in the suit) has challenged the Judgment dated 01.07.2019 whereby his suit for Specific Performance of the Agreement to Sell dated 05.03.2010 and Permanent Injunction, has been dismissed.
2. Facts in brief are that Shri Jeevan Dass, father of the respondents (who were the defendants in the original suit), was the recorded owner of the premises bearing no. 7/13 Roop Nagar, Delhi-110007 admeasuring about 515 square yards (hereinafter referred to as “the suit property”). He died intestate on 13.03.1979 leaving behind his legal heirs i.e, his sons and daughters who relinquished their legal rights in the suit property in favour of the mother, Smt. Ram Pyari, who became the owner of the suit property. Smt. Ram Pyari died on 22.09.1999 leaving behind a registered Will dated 08.01.1981 bequeathing the suit property in favour of respondent nos. 1 to 3. The suit property was accordingly mutated in favour of the three respondents vide Mutation Letter No. TAX/CLZ/CENRANGE/04-392 dated 21.06.2005 on the basis of the Will of late Smt. Ram Pyari and the No Objection Certificates given by other legal heirs of late Smt. Ram Pyari.
3. The appellant (who was the plaintiff in the original suit) entered into an Agreement to Sell dated 05.03.2010 with the respondents No. 1 to 3 in respect of the suit property for a sale consideration of Rs. 10,42,50,000/-. It was informed by respondent no. 1&2 that though No Objection Certificates have already been given by the other legal heirs of Smt. Ram Pyari, and they had no title interest in the suit property, but fresh No Objection Certificates of the other legal heirs shall still be provided to the appellant. Both respondent nos. 1 and 2 also informed the appellant that respondent no. 3, who was based in the US, was likely to travel to India shortly and that they both were fully authorised and competent to conclude the sale transaction on his behalf. Due consent and confirmation was taken from respondent no. 3 telephonically by respondent nos. 1 and 2, in the presence of the appellant. Accordingly, Rs. 5,00,000/- was paid by the appellant as an advance sale consideration for which formal Receipt-cum-Agreement dated 05.03.2010 was signed and executed by Respondents no. 1 and 2 acknowledging and confirming the sale transaction in respect of the suit property which was duly witnessed by two brokers, namely Gagan Makkar and Harmeet Singh. In terms of the Reciept-cum-Agreement to Sell, the final date for payment of balance consideration was agreed to be on or before 05.10.2010.
4. The appellant claimed that with a view to further effectuate the agreed sale transaction, he made a further payment of Rs. 45,00,000/- in cash to respondent nos. 1 and 2 on 15.06.2010 in the presence of the broker Sh. Harmeet Singh and his cousin, Sh. Hardev Singh Suri. In good faith, the appellant did not insist upon issuing of receipt of the said payment as respondent nos. 1 and 2 represented and assured the appellant that the respondent no. 3 was travelling to India shortly and that they would jointly execute and issue the receipt. They also assured the appellant that they had obtained fresh No Objection Certificates from the other legal heirs of Late Smt. Ram Pyari.
5. However, Respondent no. 3 turned dishonest and started correspondence with his broker, Shri. Gagan Makkar through e-mails. He made vague and evasive proposals demanding modification/variation in the consideration amount for the sale transaction. The appellant on becoming aware of the same, confronted respondent nos. 1 and 2. He also sent a Legal Notice dated 01.09.2010 calling upon respondents to execute the Agreement to Sell and to hand over the vacant, peaceful and physical possession of the suit property on or before 05.10.2010 and also expressed that he was ready and willing to pay the balance consideration amount of Rs. 9,92,50,000/-.
6. The respondents failed to give any reply to the Le
J.P. Builders v. A. Ramdas Rao
H.P. Pyarejan v. Dasappa (Dead) By L.Rs.
Ram Kumar Aggarwal v. Thawar Das
Raghunath Rai v. Jageshwar Prashad Sharma
The appellant must prove readiness and willingness to perform the contract, including the availability of funds, for a claim of specific performance.
In suits for specific performance, the burden lies on the defendant to prove claims that a sale agreement was a loan; the plaintiff must demonstrate continuous readiness and willingness to perform th....
Party praying for specific performance of a contract has to prove on record availability of balance sale consideration on date when it was required to be paid.
Plaintiffs must provide clear evidence of readiness and willingness backed by fund availability to claim specific performance of a contract, as mere statements are insufficient.
Specific performance requires proof of continuous readiness and willingness by the plaintiff, and failure to demonstrate this justifies denial of relief.
The main legal point established in the judgment is the requirement for the plaintiff to prove financial capacity and willingness to perform the contract, as mandated by Section 16(c) of the Specific....
The appellate court emphasized that specific performance requires proof of the plaintiff's readiness and willingness to perform the contract, which was not adequately addressed by the trial Court.
Continuous proof of readiness and willingness is essential for specific performance; failure to prove financial capacity and timely action disallows enforcement.
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