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SUPREME COURT OF INDIA
M.Y. EQBAL & PINAKI CHANDRA GHOSE, JJ.
K. Prakash – Appellant
Versus
B.R. Sampath Kumar – Respondent
Civil Appeal No. 9047 of 2014 (Arising out of Special Leave Petition (Civil) No.2271 of 2012)
Decided On : 22-09-2014
77 ER 209; (1597) 5 Co.Rep.99—Relied.
(B) Specific Relief Act, 1963—Sections 16(c) and 20—Specific performance of contract—Where plaintiff brings a suit for specific performance of contract for sale, law insists a condition precedent to grant of decree for specific performance that plaintiff must show his continued readiness and willingness to perform his part of contract in accordance with its terms from date of contract to date of hearing—Normally, when trial court exercises its discretion in one way or other after appreciation of entire evidence and materials on record, appellate court should not interfere unless it is established that discretion has been exercised perversely, arbitrarily or against judicial principles—Appellate court should also not exercise its discretion against grant of specific performance on extraneous considerations or sympathetic considerations. (Paras 16 and 17)
1759) 1 Eden 177; 28 ER 652—Relied.
(C) Specific performance of contract—Grant of relief—A party is not entitled to get decree for specific performance merely because it is lawful to do so—However, once an agreement to sell is legal and validly proved and further requirements for getting such a decree is established then the Court has to exercise its discretion in favour of granting relief for specific performance. (Paras 16 and 17)
(D) Specific Relief Act, 1963—Sections 16(c) and 20—Specific performance of contract—Agreement for sale of property—Subsequent rise in price will not be treated as a hardship entailing refusal of decree for specific performance—Rise in price is a normal change of circumstances and on that ground decree for specific performance cannot be reversed—However, High Court while granting decree for specific performance can impose such condition which may to some extent compensate defendant-owner of property—On payment of Rs.25 Lakhs, less already paid by plaintiff, defendant-owner shall execute registered sale deed. (Paras 19, 20 and 22)
(2002) 8 SCC 146—Relied.
Facts of Case—Disputes pertain to self acquired property of father of respondent. Sum and substance of appellant-plaintiff’s case is that defendant-respondent has failed to perform his part of contract though appellant-plaintiff was ready and willing to perform his part of contract subsequent to agreement for sale of subject property.
Findings of Court—Agreement was entered into between parties in 2003 for sale of property for a total consideration of Rs.16,10,000/-. Ten years have passed by and now price of the property in that area where it situates has increased by not less than five times. Keeping in mind factual position, appellant should pay a total consideration of Rs.25 Lakhs, being price for property in question.
Judgment :-
M.Y. Eqbal, J.
Leave granted.
2. This appeal by special leave is directed against the judgment and order dated 23.8.2011 passed by the High Court of Karnataka whereby Regular First Appeal No.396 of 2007 of the respondent was allowed, reversing the judgment of the trial court and dismissing the suit for specific performance of the agreement filed by the plaintiff-appellant.
2. The facts of the case lie in a narrow compass.
3. All disputes pertain to a self acquired property of the father of the respondent. The respondent’s father had four sons and three daughters. On 31.7.1988, transfer of Khata was executed by all brothers and sisters in the name of the respondent. After the demise of their parents, partition seems to have taken place on 14.12.2000 among brothers and sisters and the property in question is said to have fallen to the share of defendant, who was required to pay a sum of Rs.1,25,000/- to each of the brothers and sisters in lieu of their shares in the suit house. The plaintiff had paid Rs.1,25,000/- to all his brothers and sisters except brother Selva Pillai.
4. The respondent herein executed an Agreement for Sale in favour of the appellant on 15.12.2003 agreeing to sell the schedule property for a total sale consideration of Rs.16,10,000/-. The schedule property is located at Bangalore, admeasuring 30 x 45 feet with built up area of 1700 sq.ft., consisting of ground floor and first floor including out house. The ground floor is occupied by the respondent and the first floor is occupied by the appellant. as a mortgagee. The out-house is occupied by the brother of the defendant-respondent namely Sheshadri (as mortgagee). It is relevant to note that an amount of Rs.3,75,000/- was paid by the appellant to the respondent as requested by the respondent and Sheshadri, who is occupying the out-house portion, has paid Rs.1,65,000/- as a mortgage consideration to the respondent while occupying the house. Agreement further reveals that the aforesaid amounts shall be treated as advance amount received by the respondent under the agreement of sale. The understanding between the parties is that the mortgage consideration need not be repaid by the respondent to the mortgagees including Sheshadri and his mortgage consideration will be repaid by the prospective vendee i.e. the appellant. However, on the date of execution of sale agreement, only a sum of Rs.5,000/- was paid by the appellant to the respondent. Thus, in all a sum of Rs.5,45,000/- is said to have been paid by the appellant. The plaintiff could raise loan of Rs.3 lakh by securing property. The remaining sale consideration of Rs.7,65,000/- was payable to the respondent within one year from the date of the agreement, and in case respondent fails to comply with any of the conditions in the agreement, he would repay double the amount i.e. Rs.10,90,000/- to the appellant.
5. Although prescribed time was one year, litigation seems to have started between the parties within three months. Repeated complaints were filed by the appellant against the respondent before the police authorities. At last, appellant-plaintiff moved a suit on 9.7.2004 praying for a decree of specific performance on the ground that the respondent-defendant has denied the execution of the sale deed. The sum and substance of the appellant-plaintiff’s case is that the defendant-respondent has failed to perform his part of the contract though the appellant-plaintiff was ready and willing to perform his part of the contract.
6. The defendant-respondent denying Agreement Ex.P1 pleaded in his written statement that there being difference of opinion between himself and his brothers, he was in highly disturbed state of mind and when he approached the appellant for suggestion and help, appellant took his signature on the alleged agreement of sale and he signed it since he had implicit faith in the appellant. The appellant-plaintiff had assured that B.R. Sheshadri - brother of the respondent-defendant, who was
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