IN THE HIGH COURT OF JUDICATURE AT MADRAS
A.D. JAGADISH CHANDIRA, J.
Ramalingam (Died) & Ors. - Appellants
Versus
Kalai Bharathi Economic Development Trust, rep. by its Managing Director Kalaikumar, Vellore & Anr. - Respondents
S.A. No. 531 of 2021 & C.M.P. No. 11100 of 2021
Decided On : 08-12-2023
Specific Performance - Contract - Specific Relief Act - Section 20, Section 16(c) - [The court discussed the provisions of the Specific Relief Act, particularly Section 20 and Section 16(c), and their application to the case. The court highlighted the importance of proving the execution of the agreement of sale, payment of consideration, and readiness and willingness of the parties for specific performance. The court also emphasized the protection of subsequent bona fide purchasers under Section 19(b) of the Specific Relief Act.]
Fact of the Case:
The plaintiff entered into an agreement of sale with the first defendant for a property. The plaintiff alleged that the first defendant created a false sale deed in favor of the second defendant to defraud the plaintiff. The Trial Court dismissed the suit, but the first appellate court decreed the suit for specific performance. The second defendant appealed the decision.
Finding of the Court:
The court found that the plaintiff failed to prove the execution of the agreement of sale, payment of consideration, and readiness and willingness for specific performance. The court also held that the second defendant, as a subsequent bona fide purchaser, was protected under Section 19(b) of the Specific Relief Act. Therefore, the court set aside the first appellate court's decision and restored the judgment of the Trial Court, dismissing the suit.
Issues: The issues revolved around the execution of the agreement of sale, payment of consideration, readiness and willingness for specific performance, and the protection of subsequent bona fide purchasers under the Specific Relief Act.
Ratio Decidendi: The plaintiff must prove the execution of the agreement of sale, payment of consideration, and continuous readiness and willingness for specific performance. Subsequent bona fide purchasers are protected under Section 19(b) of the Specific Relief Act.
Final Decision: The Second Appeal was allowed, setting aside the first appellate court's decision and restoring the judgment of the Trial Court, thereby dismissing the suit.
JUDGMENT
(Prayer: Second Appeal filed under Section 100 of CPC against the Judgment and Decree dated 18.2.2021 passed in A.S.No.50 of 2017 on the file of the II Additional District Judge, Vellore @ Ranipet reversing the Judgment and decree dated 20.7.2016 passed in O.S.No.82 of 2014 on the file of the Subordinate Judge, Arakkonam.)
1. Second defendant in the suit, who suffered a decree of specific performance passed by the first appellate court while reversing the finding of the Trial Court, is the appellant in the present Second Appeal.
2. The Second Appeal came to be admitted on 5.8.2021 on the following substantial questions of law:-
(i) Whether the Lower Appellate Court was right in granting an equitable remedy for Specific Performance, when it is well settled law that the relief of Specific performance of Contract is equitable remedy and discretionary remedy of Court passing it, the relief shall have not been granted to a person who came to Court with unclean hands?
(ii) Whether the Lower Appellate Court was right in granting a relief of Specific Performance of Contract, when it is well settled proposition of Law that the plaintiff who sought a relief of Specific performance or contract, mandatorily has to prove his readiness and willingness from the date of Agreement till execution of Sale Deed irrespective of time fixed for performance in the Agreement of Sale?
(iii) Whether the Lower Appellate Court is right to granting a relief of Specific Performance ignoring Law that as per Section 20 of the Specific Relief Act, the Court is not bound to grant such relief merely because it is lawful to do so?
3. The case of the first respondent/plaintiff, in brief, is as under:-
i) The schedule property is belonged to the 1st defendant. An agreement of sale was entered on 18.07.2005 between the plaintiff and the first defendant in respect of the the suit property for a sale consideration of Rs.2,06,125/- on receipt of an advance amount of Rs.15,000/- by the first defendant with an arrangement that the plaintiff had to pay the balance amount of Rs.1,91,125/- within three months from the date of Sale agreement. Time was not made as essence of the contract. The father of the 1st defendant, namely Subramania Reddy was also one of the attestors to the sale agreement.
ii) Subsequently, the 1st defendant's father received a sum of Rs.35,000/- from the plaintiff on 13.08.2005 and another sum of Rs.10,000/- on 27.8.2005 towards part of sale consideration by affixing his Left Thumb impression on the verso of the said agreement of sale on behalf of the first defendant and thus, the plaintiff has totally paid Rs.60,000/- to the first defendant.
iii) The plaintiff was ready and willing to pay the balance sale consideration and get the sale deed executed in his name, but the first defendant was protracting the same with ulterior motives. Ultimately, on 29.05.2006, the plaintiff came to know that the first defendant has created a false and vexatious sale deed dated 9.5.2006 in respect of the suit properties in favour of the 2nd defendant colluding with him to defraud the plaintiff.
iv) The plaintiff obtained a certified copy of the sale deed dated 9.5.2006 alleged to have been executed by the first defendant in favour of the second defendant and found that it was executed for a low price of Rs.1,70,000/-.
v) Having aggrieved over the same, the plaintiff had issued a legal notice on 03.06.2006 to the defendants demanding them to execute a registered sale deed as per the suit sale agreement in favour of the plaintiff. The defendants, though received the notice, they did not send any reply to the plaintiff and thereby the plaintiff has come up with the suit.
4. A written statement was filed by the first defendant, which was adopted by the second defendant, contending as under:-
i) The allegation that the first defendant had entered into a S
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Specific performance – Relief of specific performance is equitable remedy – Plaintiff have to necessarily show their readiness and willingness in performing their part of contract from date of agreem....
The court affirmed that specific performance can be granted when the execution of the sale agreement is proven and the plaintiff demonstrates readiness and willingness to perform their contractual ob....
The judgment establishes that specific performance can be granted when the plaintiff proves the execution of the contract and demonstrates readiness and willingness to perform, despite the defendant'....
Sale agreement genuine but specific performance denied due to plaintiff's delay proving lack of readiness and willingness.
The court held that a plaintiff must prove readiness and willingness in specific performance claims, and doubts regarding the authenticity of an agreement can lead to dismissal.
The deceased plaintiff's failure to prove readiness and willingness to perform the contract and the lack of evidence to support the claim led to the setting aside of the lower courts' decisions.
The continuous readiness and willingness of the plaintiff to perform his part of the contract is a condition precedent to grant the relief of specific performance.
Specific performance can be granted when the buyer has made substantial payments and the seller's refusal to execute the sale deed is unjustified, even if specific issues on readiness and willingness....
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