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B. S. Bhanumathi, J
Varam Chinna Venkatesulu – Appellant
Versus
Indian Financial Association – Respondent
Appeal Suit No.189 of 2017
For the Appellants/Petitioners: V.R.Reddy Kovvuri
For the Respondents: Solomon Raju
A vendor is estopped from setting up a defense of their own lack of title or defective title in a suit for specific performance filed by a purchaser, and the court must exercise its judicial discretion to grant specific performance when the evidence indicates the parties freely entered into the contract.
Headnote:(A) Specific Relief Act, 1963 - Section 17 - Agreement for sale - Suit for specific performance - Vendor’s plea of lack of title - Held, a vendor cannot set up the defect in his own title as a defense in a suit for specific performance filed by the purchaser. (Para 14)
(B) Appeals - Discretionary relief - Trial Court erred in refusing specific performance based on unsupported claims of land inalienability and alleged tampering - Appellate Court exercising discretion should grant specific performance when defendants fail to demonstrate clean hands and where evidence substantiates a valid contract. (Paras 13, 16)
Facts of the case:
The appellant (plaintiff) entered into an agreement with the respondents (defendants) to purchase property for a total consideration, paying an advance of Rs.3,00,000/-. The defendants failed to perform the contract, claiming the agreement was tampered with and that the land was assigned (D.K.T) land, rendering it inalienable. The trial court rejected the specific performance prayer, ordering only a refund of the advance, leading to the current appeal.
Findings of Court:
The defendants failed to establish that the contract date was altered or that the land was inalienable. The court concluded that the defendants' contradictory evidence and failure to prove their defenses entitled the plaintiff to specific performance.
Issues: Whether the plaintiff is entitled to specific performance, whether the nature of the land bars alienation, and whether the defendants effectively proved their defenses regarding contract tampering and refund of consideration.
Ratio Decidendi: It is settled law that a vendor cannot plead their own lack of title or defective title to defeat a claim for specific performance brought by a purchaser. The court held that discretion for specific performance must be exercised judiciously, and since the defendants failed to provide concrete evidence of inalienability or refund of advance, the agreement remains enforceable.
Result: Appeal allowed; suit decreed in favor of the plaintiff.
| Table of Content |
|---|
| 1. overview of the parties' pleadings and the trial court's order concerning the agreement of sale. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8) |
| 2. assessment of evidence regarding contract validity, tampering, and the alienability of assigned land. (Para 9 , 10 , 11 , 12) |
| 3. application of discretionary relief principles and the binding precedent regarding vendor estoppel in specific performance suits. (Para 13 , 14 , 15 , 16 , 17 , 18) |
JUDGMENT:
This appeal, under Section 96 CPC, is preferred by the unsuccessful plaintiff aggrieved by the judgment and decree, dated 29.12.2016, passed in O.S.No.26 of 2011 on the file of the Court of I Additional District Judge, YSR Kadapa District.
2. Heard Sri V.R.Reddy Kovvuri, learned counsel for the appellant/plaintiff and Sri Solomon Raju, learned counsel for the respondents/defendants.
3. The case of the plaintiff, in brief, is that the defendants claim to be owners of the property mentioned in the schedule having purchased the same from Paidikaluva Danam under registered sale deed, dated 28.08.2002, vide document No.4988 of 2002. They approached the plaintiff and expressed their intention to sell the same to the plaintiff at Rs.12,000/- per cent and entered into an agreement of sale with the plaintiff on 18.09.2010. On the date of the agreement, the plaintiff paid an advance of Rs.3,00,000/-. The defendants agreed to get the property surveyed by a government surveyor. Time fixed is 10.02.2011 to perform their part of contract under the agreement. As per the agreement, after the defendants fulfill the obligations under the contract, then only, the plaintiff has to pay the balance of sale consideration to get the property registered either in the name of the plaintiff or his nominee. Both the defendants failed to get the property measured by a surveyor in spite of repeated demands made by the plaintiff within the time fixed under the agreement. The defendants failed to produce any Encumbrance Certificate. The plaintiff has been requesting the defendants to execute and register a sale deed in favour of the plaintiff, but the defendants have been postponing the same on one pretext or the other. The plaintiff got issued a legal notice, dated 05.02.2011, requiring the defendants to appear before the Sub-Registrar, Kadapa, to execute and register a regular sale deed at his expenses. However, the defendants refused to receive the said notices and returned the notice covers and failed to appear before the Sub-Registrar, Kadapa, on 09.02.2011. The plaintiff sent another notice requiring the defendants to appear before the Sub-Registrar, Kadapa, on 09.02.2011, to execute and register a regular sale deed at his expenses. The plaintiff appeared before the Sub-Registrar on 09.02.2011, but the defendants did not turn up. Thus, the intention of the defendants goes to show that they are evading execution of the registered sale deed in favour of the plaintiff. Instead of appearing before the Sub-Registrar, the defendants gave a reply through their counsel, on 09.02.2011, with all false allegations and contending that they had returned the token advance amount of Rs.3,00,000/- to the plaintiff, however, the plaintiff failed to return the copy of sale agreement executed by the defendants. The plaintiff understood that the defendants are not showing any interest to perform their part of the contract, for the reasons best known to them, and as such, the plaintiff is constrained to file the suit seeking the relief of specific performance of agreement of sale and in the alternative for refund of the advance amount together with penalty of equal amount.
(b) The defendants filed a written statement denying the plaint averments and contending that the suit is barred by law of limitation. The plaint schedule property of an extent of Ac.1.00 cents is situated in Survey No.18/3 of Ramaraju Palli village fields of Kadapa. The defendants entered into an agreement with the plaintiff for consideration of Rs.12,000
