Specific performance under Section 20 of the Specific Relief Act is discretionary even when an oral contract is established, allowing for compensation in lieu if deemed appropriate.

JUDGMENT :

BIREN VAISHNAV, J.

1. The First Appeal has been filed by the original plaintiff and the cross objections by the original defendant no.1. The appeal by the original plaintiff challenges the legality and validity of the judgement and decree dated 18.04.2017 passed by the learned Principal Senior Civil Judge, Ahmedabad (Rural) in Special Civil Suit No.201 of 2010, whereby, the said suit preferred by the appellant has been partly dismissed qua the relief seeking specific performance. However, the suit is partly decreed whereby the appellant is held entitled to recover an amount of Rs.13,83,040/- as compensation for breach of contract with interest @ 6% from the date of filing of the suit till its realization. The appellant shall hereinafter be known as the plaintiff.

2. Cross-objections have been filed by the defendant no.1, whereby, the suit has been partly decreed and the objector – defendant no.1 has been directed to pay compensation as aforesaid. The cross-objector is the respondent no.1 in the First Appeal, hereinafter to be referred to as ‘the defendant’.

3. The facts in brief are as under:

3.1 The plaintiff filed the Regular Civil Suit against the defendant stating that the plaintiff wanted to purchase ½ share of plot no.55 from defendant which the defendant wanted to sell. Accordingly, the defendant requested the society to divide the plot into two parts so as to sell half the portion admeasuring 500 square yards of the land with an old superstructure of bungalow no.509. It was the case of the plaintiff that negotiations and discussions went on for more than six months and ultimately, the contract was concluded orally on 26.01.2010, where, the defendant agreed to sell one half share of the plot for a total consideration of Rs.1.50 crores on certain terms and conditions. According to the plaintiff, he paid an amount of Rs.5 lakhs as earnest money to the defendant by way of cheque dated 26.01.2010 drawn on HDFC Bank Ltd.

3.2 It is the case of the plaintiff that on 30.01.2010, for the division of the plot, an application was made to the society by the defendant. The defendant had to make payment by way of maintenance charges of Rs.1,91,520/-and the cheque for such amount was issued by the plaintiff which cheque was received by the society along with the letter dated 11.02.2010.

3.3 The case of the plaintiff further was that a form was issued by the society to be signed by both the parties to issue two separate share certificates. The form was filled up in the society’s office itself and the cheque was prepared for an amount of Rs.2,50,000/- by the plaintiff. However, since the signature of the defendant no.2 was required in the form, the first defendant did not return the form and thereafter, telephoned the plaintiff that he is not interested in the deal as the price of land has gone up. The cheque was returned by the society as the form was not complete. Based on the documents and oral documents therefore, it was the case of the plaintiff that when an oral contract was entered into between the plaintiff and the defendant no.1 and the plaintiff had paid Rs.5 lakhs by way of cheque towards earnest money and the defendant had applied for the split certificates with a cheque of Rs.1,91,520/- the cause of action has arisen to file the suit for specific performance. Accordingly, the plaintiff prayed for a decree of specific performance of the oral agreement dated 26.01.2010 and in the alternative, damages to the tune of Rs.10 lakhs together with the amount of Rs.6,91,520/- was already paid. In all therefore, alternatively claimed Rs.16,91,520/- with running interest @ 12%.

3.4 In response to the plaint, a written statement was filed by