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MADRAS HIGH COURT
S.M. Subramaniam, J.
Mr. Vijayakumari —Appellant
versus
P. Sekar —Respondent
A.S.No.613 of 2014
Decided on 17.2.2020
Counsel for the Parties:
For the Appellant:K.R.B. Dhaaranee for Mr. K.V. Babu, Advocate
For the Respondent:Mr. C.B. Murali Krishnan, Advocate
IMPORTANT POINTS
(1) Court cannot direct a party to execute sale deed if sale consideration is inequitable or nature of contract or circumstances are over mitigating factors.
(2) Suit for Specific Performance—Alternate relief of return of advance in a suit for specific performance is a consequential relief and same need not be construed as a different relief.
Headnote:
(A) Agreement to Sell—Suit for Specific Performance—Appeal by defendant-appellant—Since execution is not at all denied, argument of Counsel for defendant that examination of attestor is a must does not hold good—It is not sufficient that plaintiff could be able to establish that suit sale agreement is genuine and true—Contract must be voidable—Contract is established by plaintiff and he performed his portion of contract, still relief of specific performance being a discretionary one, Court has considered overall circumstances of facts and has taken a decision, whether any inequality would arise in the event of granting relief of specific performance—Court cannot direct a party to execute sale deed if sale consideration is inequitable or nature of contract or circumstances are over mitigating factors—These are factors to be considered for grant of relief of specific performance—Though contract is not voidable in present case, circumstances and efflux of time make it inequitable to grant relief of specific performance—Judgement of Trial Court is to be set aside. [Specific Relief Act, 1963—Section 20] (Paras 15 and 19)
(B) Specific Relief Act, 1963—Section 20—Suit for Specific Performance—Alternate relief of return of advance in a suit for specific performance is a consequential relief and same need not be construed as a different relief—Once relief of specific performance is rejected, then refund of advance amount shall be consequential as no parties to suit can be allowed to have an unjust enrichment—Dismissal of relief of suit for specific performance, cannot stand in way of granting alternate relief to refund advance amount with reasonable interest—Alternate relief to refund advance amount is to be construed as a general relief, as such a relief is consequential to rejection of relief of specific performance—In event of not considering alternate relief under umbrella of general relief, then one of party to civil suit would be prejudiced and other party will get an unjust enrichment—There is no impediment either for Trial Court or for Appellate Court to grant alternate relief of refund of advance amount to either of parties to civil suit or an appeal in the event of rejecting relief of specific performance in a suit or in an appeal suit. (Paras 16 and 20)
Result: Appeal Suit allowed in part.
Based on the provided legal document, here are the key points with corresponding references:
- Subject of the Judgment: The case concerns Specific Performance and Equitable Relief under the Specific Relief Act, Section 20. [judgement_subject]
- Core Principle on Specific Performance: A court cannot direct a party to execute a sale deed if the sale consideration is inequitable, the nature of the contract is problematic, or mitigating circumstances exist. [IMPORTANT POINTS (1)][42000050150014][42000050150018]
- Consequential Relief: In a suit for specific performance, the alternate relief of returning an advance payment is a consequential relief and does not need to be construed as a different relief. [IMPORTANT POINTS (2)][42000050150019][42000050150020]
- Judicial Discretion: While a plaintiff must establish that a contract is genuine and that they are ready and willing to perform, this is insufficient. The court must also determine if granting specific performance would cause inequality or unjust enrichment due to changed circumstances or efflux of time. [42000050150014][42000050150018]
- Market Value vs. Contract Price: Even if a contract is not voidable, the court must consider if the current market value of the property renders the original consideration inequitable, potentially causing prejudice to the defendant and unjust enrichment for the plaintiff. [42000050150016]
- Legal Precedent: The Hon'ble Apex Court in Surinder Kaur vs. Bahadur Singh held that specific performance is discretionary and can be refused if circumstances make it inequitable to enforce, even if the contract is otherwise valid. [42000050150017] (!)
- Granting Alternate Relief: Both Trial Courts and Appellate Courts have the power under Order XLI, Rule 33 of the Code of Civil Procedure to grant alternate relief (refund of advance with interest) even if not explicitly sought in the plaint, to prevent unjust enrichment and prejudice. [42000050150019][42000050150020][42000050150028]
- Outcome: The judgment of the Trial Court directing the execution of the sale deed is set aside. The appellant/defendant is directed to refund the advance amount of Rs. 6,30,000 along with interest (12% p.a. initially, then 6% p.a.), and the appeal suit is allowed in part. (!) (!) (!) [42000050150022]
JUDGEMENT
S.M. Subramaniam, J.—The Appeal Suit is directed against the Judgement and Decree dated 03.02.2014 passed in O.S.No.11781 of 2010. The defendant is the appellant in the Appeal Suit and the respondent/plaintiff instituted a suit for specific performance to enforce the suit sale agreement dated 31.08.2006.
2. The suit sale agreement had been entered into between the parties on 31.08.2006 for sale of the suit property for a total sale consideration of Rs.13,00,000/-. Initially, the plaintiff has paid a sum of Rs.25,000/- and agreed to pay the balance sale consideration of Rs.12,75,000/- on the date of execution of the sale deed.
3. It is contended that after execution of the sale agreement, there were changes that took place between the plaintiff and the defendant and the defendant made a proposal to the plaintiff that there is a tenant in the first floor and the said tenant refused to vacate his portion and also stated that the plaintiff has to evict the said tenant by way of making payment of Rs.50,000/- to him. Accordingly, the plaintiff paid a sum of Rs.50,000/- on 10.09.2006 and the said tenant was evicted. The payment of Rs.50,000/- was also duly acknowledged by the defendant. On receipt of the amount, the defendant handed over the particular portion to the plaintiff immediately. In respect of other tenant, namely Ramesh, the plaintiff further paid a sum of Rs.75,000/- on 16.09.2006 for vacating his portion in the first floor. The said Ramesh vacated his portion on receipt of Rs.75,000/- from the plaintiff and the said portion was handed over to the plaintiff by the defendant.
4. It is contended that the plaintiff has paid a total sum of Rs.1,25,000/- to the defendant’s tenants, apart from the initial payment and in total, the plaintiff has further paid Rs.3,75,000/- on 21.09.2006, Rs.20,000/- on 29.09.2006, Rs.55,000/- on 14.12.2006 and a sum of Rs.30,000/- on 19.12.2006 and accordingly, the plaintiff claims that he paid advance amount of Rs.6,30,000/- towards the sale consideration and the balance sale consideration of Rs.6,40,000/- was to be paid during the relevant point of time.
5. The plaintiff has approached the defendant for execution of sale deed by receiving the balance sale consideration. However, the defendant evaded the execution and this apart, it was stated by the defendant that she had already executed an agreement prior to the suit sale agreement in favour of one Mr.Saravanan for the suit property and the defendant failed to execute the sale deed in favour of the said Saravanan also. The said Saravanan filed a suit in O.S.No.6573 of 2006 for the relief of specific performance. Against the said suit, the defendant preferred another appeal in A.S.No.1001 of 2004 before the High Court. A compromise was arrived in the above appeal between the said Saravanan and the defendant and accordingly, the defendant paid a sum of Rs.4,00,000/- to the said Saravanan and the matter was settled out of Court. Under those circumstances, the plaintiff issued a notice to the defendant and subsequently instituted a suit for specific performance.
6. The defendant filed a written statement denying the allegations set out in the plaint. The defendant contended that he is living in the suit premises with his two children. The suit property was purchased in the year 1985 by the husband of the defendant, who died on 29.09.2006, leaving behind the defendant and two children as his legal heirs. Originally, the defendant had entered into an agreement with one Mr.Saravanan. Subsequently, the dispute arose between the said Saravanan and the defendant, and a suit was instituted and when the appeal was pending before this Court, the issues were settled. The defendant accordingly set out her defense in the written statement and prayed for dismissal of the suit.
7. The Trial Court framed the issues as to (1) whether the plaintiff is entitled for the relief of specific performance of the suit sale agreement, (2) whether the agreement o
