BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
R. VIJAYAKUMAR, J.
M. Thamizharasu & Ors. - Appellants
Versus
M. Krishnan & Ors. - Respondents
C.R.P.(PD)(MD). Nos. 2152 to 2157 of 2014
Decided On : 22-09-2023
Specific Performance - Sale Agreement - 12.12.1987 - O.S.No.356 of 1991 - [1989 Act 1, Section 76, 1983 Act 1, Section 35, 2006 Act 1, Section 28, 2010 Act 2, Section 24] - The court discussed the validity of the sale agreement dated 12.12.1987 and the plaintiff's right to seek specific performance. It highlighted the principle that once a party claims refund of advance amount, the prayer for specific performance cannot be reintroduced through amendment of the plaint. The court also emphasized the importance of readiness and willingness to perform the contract in seeking specific performance.
Fact of the Case:
The plaintiff entered into a sale agreement on 12.12.1987 with the defendants for the transfer of shares. After a legal notice for specific performance, the defendants claimed that other shareholders were not willing to sell their shares. The plaintiff then filed a suit for recovery of the advance amount paid.
Finding of the Court:
The court found that the plaintiff had abandoned the prayer for specific performance by reconciling with the defendants' contentions and seeking recovery of the advance amount. It held that the trial court erroneously allowed amendments that completely changed the cause of action.
Issues: Validity of the sale agreement, plaintiff's right to seek specific performance, and the permissibility of amending the plaint to reintroduce the prayer for specific performance.
Ratio Decidendi: Once a party claims refund of advance amount, the prayer for specific performance cannot be reintroduced through amendment of the plaint. The plaintiff must demonstrate readiness and willingness to perform the contract to seek specific performance.
Final Decision: The orders allowing the amendments were set aside, and all the revision petitions were allowed.
JUDGMENT
(Prayer in CRP(MD).No.2152 of 2014: Civil Revision Petition filed under Article 227 of Constitution of India, to allow this civil revision petition thereby to set aside the fair and decreetal order dated 24.03.2014 made in I.A.No.30 of 1993 in O.S.No.356 of 1991 on the file of the First Additional Subordinate Judge, Trichirappalli and dismiss the same.)
Common Order:
1. The first defendant, defendants 3 to 11 and the legal heirs of the second defendant in O.S.No.356 of 1991 on the file of the I Additional Subordinate Court, Tiruchirappalli are the petitioners in all the revision petitions.
2. The first respondent in the revision petition had filed O.S.No. 356 of 1991 for the relief of recovery of money towards refund of advance amount arising out of a sale agreement dated 12.12.1987. According to the plaintiff, he entered into an agreement on the above said date with the defendants who are the promoters and share holders of Sri Rangaraja Private Limited, Srirangam. The plaintiff had further pointed out that all the share holders of the said private limited company are the family members and they have agreed to transfer their shares to the plaintiff and the defendants have been appointed as their agents for entering into the agreement of sale.
3. Based upon the representation made by the defendants, the plaintiff is said to have entered into an agreement of sale. The plaintiff had further contended that the defendants have agreed to transfer all the shares for a consideration of Rs.9,00,000/- and the defendants should vacate the lessee of the theatre and hand over actual possession to the plaintiff. On such handing over of actual possession, the balance sale consideration would be paid by the plaintiff.
4. The plaintiff had further contended that the pursuant to the said agreement, he had paid an advance of Rs.55,000/- on 12.12.1987 and further payments were made totalling to a sum of Rs.2,91,000/-. After getting possession from the tenant, the defendants evaded to hand over possession of the theatre and they were not prepared to perform their part of the contract. A legal notice was issued to the defendants on 12.09.1990 and those notices were returned unserved.
5. The plaintiff further contended that he had approached the defendants demanding performance of their part of the contract. The defendants had contended that the other share holders have not signed the agreement and they are not prepared to transfer their shares and they do not consent for transfer of the shares. The plaintiff further contended that the defendants had entered into an agreement by falsely representing that all the share holders have consented for transfer of their shares. Hence, the plaintiff had filed the suit for recovery of advance amount paid by him.
6. The defendants had filed a written statement admitting the receipt of Rs.96,000/- alone. The defendants further contended that the plaintiff had not evinced any interest in transfer of the shares in his name and the plaintiff had committed the breach of terms of the agreement.
7. In the light of the said written statement, the plaintiff had filed the following applications:
(a) I.A.No.776 of 1992 to implead the defendants 3 to 14 who are the other share holders of the private limited company and Thiruppathi Kali Gopuram Vaikundakoil Mutt which is the owner of the land.
(b) I.A.No.30 of 1993 for amending the plaint to insert paragraph Nos.16 to 32 and also to amend the cause of action paragraph. The plaintiff further sought to amend the prayer in order to include the prayer for specific performance.
(c) I.A.No.1194 of 1997 has been filed to amend the petition in I.A.No.776 of 1992 to substitute the representation of the mutt.
(d) I.A.No.1195 of 1997 to amend the cause title in I.A.No.30 of 1993 to substitute the representation of the mutt.
(e) I.A.No.1262 of 2003 to substitute the name of the representation of the mutt in I.A.No.30 of
Once a party claims refund of advance amount, the prayer for specific performance cannot be reintroduced through amendment of the plaint.
Section 22 of the Specific Relief Act permits amendments to include claims for refund of earnest money at any stage, overriding limitations in the CPC.
The plaintiff must prove their readiness and willingness to perform the contract in order to be entitled to specific performance. A subsequent suit for specific performance is barred if the plaintiff....
Proof of sale agreement and advance insufficient for specific performance without continuous readiness and willingness under Section 16(c); denying contract precludes forfeiture; additional appellate....
Section 22 of the Specific Relief Act allows the plaintiff to seek the refund of earnest money or deposit at any stage of the proceeding and overrides the Code of Civil Procedure in permitting amendm....
A party's demand for the return of an advance payment and compensation can be interpreted as an abandonment of the right to seek specific performance of a contract, negating the requirement for conti....
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.