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Lourdu Mari David And Others v. Louis Chinnaya Arogiaswamy And Others
Factual and Procedural Background
The petitioner filed O.S. No. 6 of 1977 on 10-9-1980 before the Second Additional Sub-Judge, Pondicherry, seeking specific performance of an agreement of sale dated 18-10-1976. The agreed consideration was Rs 31,000, of which approximately Rs 4,000 had been paid. The petitioner, already a tenant of a portion of the property, claimed to have received possession of the remaining portion on the agreement date and asserted continuous readiness and willingness to complete the purchase.
The trial court held that Respondents 1 and 2 had breached the agreement but denied specific performance because Respondent 3 had subsequently bought the property as a bona fide purchaser for value without notice. The petitioner appealed to the High Court of Madras; during the pendency of the appeal, he died and his legal representatives were substituted.
A learned Single Judge of the High Court, by judgment and decree dated 11-9-1980, concurred with the trial court, maintaining that Respondent 3 was a bona fide purchaser without notice. On further appeal, a Division Bench dismissed LPA No. 72 of 1991 on 12-6-1996, adding that the plaintiff had not approached the court with clean hands and was therefore disentitled to equitable relief under Section 20 of the Specific Relief Act, 1963. The present special leave petition (SLP) challenges that Division Bench decision.
Legal Issues Presented
- Whether the courts below erred in refusing the decree of specific performance on the ground that the plaintiff had not come to court with clean hands.
- Whether Respondent 3’s status as a bona fide purchaser for value without notice lawfully bars the remedy of specific performance under Section 20 of the Specific Relief Act, 1963.
- Whether the Supreme Court should exercise its discretionary jurisdiction under Article 136 to interfere with concurrent factual findings and the refusal of equitable relief.
Arguments of the Parties
The opinion does not contain a detailed account of the parties' legal arguments.
Table of Precedents Cited
No precedents were cited in the provided opinion.
Court's Reasoning and Analysis
The Supreme Court reaffirmed that specific performance is an equitable remedy, the grant of which lies within the court’s discretion under Section 20 of the Specific Relief Act, 1963. A litigant seeking such equitable relief must approach the court with clean hands. The Division Bench had identified three factual circumstances demonstrating that the plaintiff advanced false or inconsistent pleas:
- Possession Misrepresentation: The plaintiff alleged he took possession of Door No. 1/53 on 18-10-1976, but his own testimony and that of DW 3 revealed contradictory dates, undermining the allegation.
- Notice to Bona fide Purchaser: The plaint asserted that the plaintiff informed Respondent 3 about the prior agreement in early December 1976. Respondent 3’s written statement denied any such notice, and the plaintiff offered no supporting testimony.
- Additional Payment Claim: The plaintiff asserted payment of an additional Rs 400 to Respondent 2 for vacating Door No. 1/53, yet this allegation was absent from the plaint, rendering it a false plea.
These inconsistencies supported the concurrent finding that the plaintiff lacked clean hands and was thus ineligible for equitable relief. Additionally, both the trial court and the High Court found that Respondent 3 had no notice of the earlier agreement and was a bona fide purchaser for value, a factual determination the Supreme Court deemed concurrent and unassailable.
Finding that the lower courts exercised their discretion on settled legal principles and that no error warranting correction existed, the Supreme Court declined to interfere under its special leave jurisdiction.
Holding and Implications
The special leave petition is dismissed.
Consequently, the plaintiff’s suit for specific performance remains dismissed, and Respondent 3’s title stands undisturbed. The decision affirms the principle that equitable relief will be denied where a party approaches the court with false or misleading claims; however, it does not establish new precedent beyond applying settled doctrine to the specific facts.
Order
1. This special leave petition arises from the judgment of the Division Bench of the High Court of Madras made on 12-6-1996 in LPA No. 72 of 1991. The petitioner had filed OS No. 6 of 1977 on 10-9-1980 before the Second Additional Sub-Judge at Pondicherry for specific performance of the agreement of sale dated 18-10-1976 to convey the property in possession as tenants under the agreement. It is their case that a sum of Rs 31,000 was sale consideration and a sum of Rs 4000 and odd was paid as part consideration. The balance consideration was Rs 28,500. He was always ready and willing to perform his part of the contract but the respondents were avoiding to execute the sale deed. Though the trial court found that Respondents 1 and 2 committed breach of the agreement of sale but denied to them specific performance of the agreement on the ground that Respondent 3 was a bona fide purchaser for value without notice of prior agreement with the petitioner. The petitioner filed the appeal in the High Court. Pending appeal, he died. Therefore, his legal representatives have come on record. The learned Single Judge by judgment and decree dated 11-9-1980 agreed with those findings and held that the 3rd respondent was a bona fide purchaser without notice of the agreement. In the impugned judgment, the Division Bench rejected the claim on the additional ground that the plaintiff did not come to the Court with clean hands. Therefore, he is disentitled to relief of specific performance. Under Section 20 of the Specific Relief Act, 1963, (for short “the Act”) the decree for specific performance is in the discretion of the court but the discretion should not be refused arbitrarily. The discretion should be exercised on sound principles of law capable of correction by an appellate court.
2. It is settled law that the party who seeks to avail of the equitable jurisdiction of a court and specific performance being equitable relief, must come to the court with clean hands. In other words the party who makes false allegations does not come with clean hands and is not entitled to the equitable relief. The Division Bench has pointed out in the judgment three grounds which disentitle the plaintiff to the equitable relief as he came with a positive case of incorrect and false facts as set out in paras 4 to 6 thus:
“On a perusal of the records we are entirely in agreement with the view expressed by the learned Judge. It is quite clear that the plaintiff has not come to Court with clean hands. There are three circumstances which are pointed out by the learned Judge and we find that they are sufficient to warrant refusal of the claim for specific performance. First is that the plaintiff claimed that he was already in possession of Door No. 2/53 as a lessee and he was given possession of Door No. 1/53 on the date of the agreement itself, viz., 18-10-1976 by Defendants 1 and 2. But, in the course of evidence he did not say anything about taking possession pursuant to the sale agreement. On the contrary, he deposed falsely that he did not mention in the plaint about getting possession of Door No. 1/53 on 18-10-1976. It is mentioned in the evidence that Door No. 1/53 was not given to the plaintiff at any time in December 1976. The tenant who was occupying the said portion has vacated the same and gave possession to Defendants 1 and 2 who in turn handed over the same to the third defendant. Thus, the case of the plaintiff regarding possession of Door No. 1/53 is false. Learned counsel contends that there was no mention in the plaint as to the date on which he took possession of Door No. 1/53. This contention is not correct. In para 5 of the plaint it is mentioned specifically that in pursuance of the agreement, the plaintiff who was in possession of Item 2 was given possession of Item 1 on that date and that he was in possession of both the items since then under the agreement dated 18-10-1976. This plea is clearly false. DW 3 who was occupying Door No. 1/53 has given evidence that the portion was vacated on 12-12-1976 by his father by taking a sum of Rs 2500 from the prior owner. The plaintiff has himself stated as PW 1 that the tenant delivered possession to the owner of the property on 15-12-1976. That relied his case that he had taken possession even on the date of agreement viz., 18-10-1976. But, in another place PW 1 has stated that the tenant of Door No. 1/53 vacated the portion on 5-12-1976. Thus, his evidence is not only false, but also discrepant.
5. The second circumstance is that the plaintiff has made an express allegation in paras 7 and 9 of the plaint that he informed the third defendant in the first week of December 1976 about the agreement when the third defendant inspected the house for the purpose of purchasing the same. This plea is also false. PW 1 has not chosen to make a whisper about this in his deposition. On the other hand, it is contended that there is no denial of the said allegation in the written statement but it is not correct. In the written statement, the third defendant has clearly stated that at no time he had any talk with the plaintiff and he was never informed about the agreement with the plaintiff.
6. The third circumstance is that the plaintiff claimed that he had paid a sum of Rs 400 in addition to the sum of Rs 4000 paid as advance to the second defendant at the latter's request for vacating Door No. 1/53. In the deposition he had stated that he had mentioned the same in his plaint, but it is not so. It is also a false plea as found correctly by the learned Judge. The above three circumstances are sufficient to uphold the refusal of specific performance. It has been held by this Court repeatedly that a person who has come to court with a false plea is not entitled to the equitable relief of specific performance.”
3. In addition, the Division Bench also agreed with the learned Single Judge and held that the third respondent had no knowledge whatever of the plaintiff's agreement and, therefore, he was a bona fide purchaser for value without notice. This is a concurrent finding of fact after appreciation of evidence. It would thus be seen that on both the grounds, the courts below rightly refused to exercise the discretion on legal principles to grant specific performance. It does not, therefore, warrant interference.
4. The special leave petition is dismissed.
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