Clarifying Section 12(3) of the Specific Relief Act: Invocation of Partial Performance and Requirements for Relinquishment

1. Introduction

The Supreme Court of India’s decision in Vijay Prabhu v. S.T. Lajapathie & Ors. (2025 INSC 52) provides significant clarity on the scope and application of Section 12 of the Specific Relief Act, 1963 (“the Act”), particularly regarding partial performance of contracts. The case revolved around a dispute on the enforceability of an agreement of sale and whether the plaintiff could invoke Section 12(3) of the Act to seek specific performance of only a part of the contract.

The petitioner (the original plaintiff), having entered into an agreement of sale, sought specific performance of that agreement or, alternatively, damages and interest. The respondents (original defendants) argued that the plaintiff was not entitled to the relief of specific performance, maintaining that the plaintiff failed to remain “ready and willing” to complete his obligations. Both the Trial Court and the High Court dismissed the plaintiff’s claim for specific performance, leading to this appeal before the Supreme Court.

This commentary will delve deep into the background of the litigation, the courts’ findings, the influencing precedents, and the legal reasoning which culminated in the Supreme Court’s dismissal of the special leave petition.

2. Summary of the Judgment

The Supreme Court upheld the decisions of the lower courts—namely, the District Judge of Nilgiris at Udhagamandalam and the High Court of Judicature at Madras—that dismissed the plaintiff’s claim for specific performance. Key aspects of the judgment are:

The plaintiff was found not to be “ready and willing” to perform his contractual obligations, a critical condition for specific performance under Section 16(c) of the Specific Relief Act.
The Court clarified that Section 12, specifically sub-section (3), cannot be used to grant partial specific performance unless specific prerequisites are satisfied—particularly, that the plaintiff must relinquish all further claims and pay the entire consideration where necessary.
The Supreme Court emphasized that while a plea for partial performance (under Section 12(3)) can be raised even at the appellate stage, the party’s conduct and readiness to fulfil the terms remain paramount considerations.
Ultimately, the special leave petition stood dismissed, and the refund of the earnest money deposited in the Trial Court (with interest) was directed to be returned to the plaintiff.

3. Analysis

3.1 Precedents Cited

The Supreme Court and the High Court both relied on earlier decisions and interpretations of Section 12 of the Act. Among the key cited precedents:

Jaswinder Kaur (Now Deceased) through her Legal Representatives and Others v. Gurmeet Singh & Others (2017) 12 SCC 810:
This ruling explained that partial performance under Section 12(3) could not be invoked if the inability to perform arose from the plaintiff’s own conduct (i.e., plaintiff’s default). It further clarified what the expression “unable to perform” entails and underscored that Section 12(3) is discretionary.
Kalyanpur Lime Works v. State of Bihar (AIR 1954 SC 165):
This case established that relinquishment of a claim for the unperformed part can be made at any stage during litigation, reflecting a flexible yet principles-based approach to the application of Section 12 of the Act.
Waryam Singh v. Gopi Chand (AIR 1930 Lah 34):
Cited with approval in Kalyanpur Lime Works, this decision clarified that a plaintiff may relinquish a portion of the contracted claim under certain conditions, even at the appellate stage.
Abdul Haq v. Mohammad Yehia Khan (AIR 1924 Pat 81):
Referenced for the proposition that courts generally will not compel specific performance of a contract unless the entire contract is legally and practically capable of being completed or unless the strict requirements of Section 12 are met.

3.2 Legal Reasoning

The courts’ reasoning hinged on the principle that specific performance is an equitable and discretionary remedy, necessitating strict adherence to the plaintiff’s obligation of being ready and willing to complete the contract. The following points constitute the heart of the legal reasoning:

Readiness and Willingness: Both the Trial Court and the High Court found the plaintiff lacking in readiness and willingness, a mandatory requirement under the Specific Relief Act. The Supreme Court confirmed this factual finding and saw no ground to disturb it.
Invocation of Section 12(3): While a plea seeking partial performance can be raised at any stage (including appeal), the plaintiff must unambiguously relinquish all other claims (including further damages) and demonstrate an ability to pay the full consideration for the portion still capable of performance. Here, the plaintiff insisted on damages along with specific performance. This approach conflicted with the statutory mandate under Section 12(3)(ii), which requires relinquishing “all claims” to the unperformed portion.
Segregability of the Contract: The Court observed that if the contract cannot be equally segmented without prejudice to the parties’ original intentions, granting partial performance becomes problematic. The agreement in question evidently was not neatly severable; thus, partial performance relief was not warranted.
Discretionary Nature of Relief: Even if technical requirements are fulfilled, the Court may still decline partial performance under Section 12(3) if, in the Court’s view, the equities of the case do not merit such relief. The plaintiff’s lack of diligence, coupled with inconsistent claims, led the Court to reject the claim for partial performance.

3.3 Impact

This judgment reinforces the principle that specific performance is not a matter of course. A few salient potential impacts include:

Stricter Compliance with Section 12: Parties attempting to invoke Section 12 for partial performance must carefully structure their pleadings to demonstrate both financial capacity (“ready and willing” to pay the entire consideration, if needed) and genuine willingness to relinquish any remaining claims.
Encouragement of Clear Contract Drafting: The ruling cautions contracting parties to ensure that their agreements are free from latent ambiguities. Where partial performance could be foreseeable, parties might consider specifying such eventualities in the contract.
Guidance on Pleading Stage: Even though the Court allowed the invocation of Section 12(3) at the appellate stage, plaintiffs are better positioned if they plead partial performance options from the outset to avoid uncertainty and procedural challenges.
Higher Burden for Plaintiffs: Plaintiffs seeking equitable relief must ensure they consistently follow up on their obligations; any sign of default or contradictory claims may dismantle their case under Section 12(3).

4. Complex Concepts Simplified

Below are some of the more intricate legal concepts discussed in the judgment, explained for clarity:

“Ready and Willing”: In the context of specific performance, a plaintiff must show that they have both the financial means and the genuine intent to fulfill their obligations under the agreement. This is typically demonstrated by offering payment on time, avoiding contradictory or dilatory pleas, and taking timely legal steps.
Partial Performance under Section 12 of the Specific Relief Act: Section 12 allows courts to grant specific performance of a part of the contract if the other part cannot be performed due to a legitimate inability (e.g., defect in title or partial destruction of the property). However, under sub-section (3), the party seeking partial performance must fulfill exacting conditions, including paying the full contract price for the portion being conveyed and relinquishing all claims regarding the remainder of the contract.
Relinquishment: This denotes a situation where a plaintiff formally gives up any claim to either the remaining portion of the contract or any additional damages. According to settled law, this relinquishment can be made at any stage (trial or appeal), as confirmed by Kalyanpur Lime Works v. State of Bihar and Waryam Singh v. Gopi Chand.
Discretionary Remedies: Courts may refuse specific performance if granting such relief would be inequitable, even if the technical legal requirements are met. Specific performance is not automatic; it depends on fairness, the plaintiff’s conduct, and the overall equities of the case.

5. Conclusion

The Supreme Court’s judgment in Vijay Prabhu v. S.T. Lajapathie & Ors. serves as a clear reiteration that strict adherence to Section 12 of the Specific Relief Act is imperative when a litigant seeks partial specific performance. A mere plea for partial relief will not suffice: the plaintiff must decisively show their readiness and willingness to pay the entire consideration for what is performable and relinquish any right to claim damages or performance for the unperformable segment.

Equally important, this case establishes that the relinquishment of remaining claims can be made at any stage of the proceedings. However, the courts will meticulously examine whether the plaintiff’s overall conduct supports granting the equitable remedy of specific performance. Hence, prospective plaintiffs must be clear, consistent, and unconditional in their requests for partial performance under the Act.

In broader terms, this decision reaffirms the equitable nature of specific performance and the stringent obligations placed on any party seeking it. The judgment highlights an unwavering message: remedy under Section 12(3) is neither automatic nor a shortcut; it demands the highest level of procedural and substantive diligence from the litigant.