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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
PANKAJ JAIN, J.
Kehar Singh - Appellant
Versus
Satnam Chand - Respondent
R.S.A. No. 1056 of 1994
Decided On : 21-08-2024
Specific Performance - Agreement to Sell - Specific Relief Act, 1963, Section 19 - The court interpreted Section 19 of the Specific Relief Act, emphasizing that specific performance can be enforced against parties claiming under a subsequent title, unless they are bona fide purchasers without notice of the original contract.
Fact of the Case:
Plaintiffs sought specific performance of an agreement to sell land dated March 31, 1986, claiming possession was delivered. Defendants contested, asserting they were bona fide purchasers with no knowledge of the prior agreement.
Finding of the Court:
The lower appellate court found that the trial court erred in disbelieving the delivery of possession to the plaintiffs and ruled in favor of the plaintiffs for specific performance.
Issues: Whether the appellants are bona fide purchasers and whether the plaintiffs are entitled to specific performance of the contract.
Ratio Decidendi: The court held that the appellants could not be considered bona fide purchasers as they had knowledge of the prior agreement, thus the plaintiffs were entitled to specific performance.
Result: The appeal was dismissed, affirming the decree of specific performance in favor of the plaintiffs.
JUDGMENT :
Mr. Pankaj Jain, J.
Defendants are in second appeal. Defendants/appellants are the subsequent vendors aggrieved of decree of specific performance granted in favour of the plaintiffs.
2. For convenience, the parties herein after are referred to by their original position in the suit i.e. the defendants as the appellants and the respondents as the plaintiffs.
3. Plaintiffs filed suit seeking decree of specific performance of agreement to sell dated 31st of March, 1986 pertaining to suit land described in the plaint ad-measuring 14 Kanals 16 Marlas. It was pleaded by the plaintiffs that defendant No.1 entered into an agreement to sell suit land in their favour on 31st of March, 1986 for a valuable consideration of Rs.30,500/-. At the time of agreement to sell, she received Rs.10,000/- as earnest money. Possession of the suit land was delivered on the spot. Parties agreed to get the sale deed executed on or before 30th of March, 1987 on payment of balance sale consideration. However, prior to the agreed date, on 16th of October, 1986 defendant No.1 executed sale deed pertaining to the suit land in favour of defendants No.2 and 3. Plaintiffs always remained ready and willing to perform their part of the contract as per the terms & conditions contained therein. Legal notice was served upon defendant No.1 by the plaintiffs through their counsel to get the sale deed executed. It was further claimed that defendants No.2 and 3 are real cousins of the plaintiffs. Land of defendants No.2 and 3 was situated abutting the suit land and defendants No.2 and 3 were in the knowledge that the possession of the land has been delivered to the plaintiffs, yet in order to defeat rights of the plaintiffs they got the sale deed executed in their favour.
4. Defendant No.1 contested the suit and denied execution of agreement to sell. She admitted receipt of Rs.10,000/- but only as a debt and claimed that she being an illiterate lady executed papers in token of receipt of loan from the plaintiffs. She claimed that she sold the land to defendants No.2 and 3 and handed-over possession to them on the spot.
5. Defendants No.2 and 3 also contested the suit claiming ownership over the suit land on the strength of registered sale deed dated 16th of October, 1986 executed in their favour by defendant No.1 for a valuable consideration of Rs.44,000/-. It was claimed that the possession of the suit land stands delivered to them on the date of sale deed and thus they are in actual physical possession of the same.
6. On the basis of the pleadings of the parties, Trial Court framed the following issues :
“1. Whether the defendant No.1 contracted to sell the suit land to the plaintiffs vide agreement dated 31.3.86 as alleged? OPP.
2. If issue No.1 is proved, whether plaintiffs are entitled to the possession of the suit land by way of specific performance of contract dated 31.3.86? OPP.
3. Whether the suit of the plaintiffs is not maintainable in the present form? OPD.
4. Whether plaintiffs have no cause of action to file the present suit? OPD.
5. Whether the plaintiffs have no locus-standi to bring the present suit? OPD.
6. Whether the proceedings of the present suit are liable to be stayed u/s 10 of CPC as alleged? OPD.
7. Whether the defendants No.2 and 3 are bonafide purchasers of the suit land for consideration and without notice as alleged, if so what effect? OPD.
8. Relief.”
7. Trial Court while deciding issues No.1, 2 and 7 held that the execution of agreement to sell in favour of the plaintiffs dated 31st of March, 1986 was proved. However, Trial Court found that the recital w.r.t. handing-over of possession of the suit land by defendant No.1 in favour of the plaintiffs is factually incorrect and it is defendants No.2 and 3 who were handed-over possession of the suit land by defendant No.1. Holding that the possession of the suit land was never delivered to the plaintiffs on 31st of March, 1986 at the time of execution of the same and rather the same was handed-over
AI
Specific performance can be enforced against subsequent purchasers if they had knowledge of the original contract.
The maintainability of a suit for specific performance is barred under Order 2 Rule 2 CPC if a plaintiff omits to claim it in an earlier suit concerning the same cause of action.
The court ruled that a suit for specific performance was not barred by Order 2, Rule 2 CPC as the appellants were permitted to withdraw a prior suit and file a new one.
The subsequent suit for specific performance of the agreement to sell based on a different cause of action is maintainable.
The plea of bar under Order II Rule 2 CPC prohibits a second suit for specific performance if based on the same cause of action previously omitted, and the suit is also barred by limitation under Art....
The plaintiff's failure to prove readiness and willingness to perform the essential terms of the contract, as required by Sec. 16(c) of the Specific Relief Act, influenced the Court's decision to set....
Court emphasized that once agreements are executed and earnest money paid, specific performance can be enforced unless clear evidence of coercion or duress is presented.
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