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AMICUS AI
Citation Codes
Neutral Citations
2006 INSC 640
Equivalent Citations
citation codes
Case Number
Disposition
Advocates
Judges
Acts
  • Section 16(c) of the Specific Relief Act
  • Section 16(c) of the Act
  • Section 16 of the Specific Relief Act
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Cites
Cited by
Citation Codes
Neutral Citations
2006 INSC 640
Equivalent Citations
citation codes
Case Number
Disposition
Advocates
Judges
Acts
  • Section 16(c) of the Specific Relief Act
  • Section 16(c) of the Act
  • Section 16 of the Specific Relief Act
Smart Summary

Factual and Procedural Background

The respondent–plaintiff entered into two agreements with the appellant–defendant for purchase of the suit property. The first agreement was dated 17-06-1985 with the last date for execution of the sale deed fixed as 14-11-1985. A second agreement dated 09-04-1987 extended the last date to 13-06-1987, and, at the appellant’s request, the deadline was further extended to 30-10-1987. When the appellant still failed to execute the sale deed, the respondent filed a suit for specific performance on 26-11-1987. All three courts below—the trial court, first appellate court, and High Court—decreed specific performance. The appellant brought the present civil appeal before the Supreme Court, which granted leave to appeal.

Legal Issues Presented

  1. Whether a suit for specific performance can be decreed when the plaint does not employ particular language expressly averring the plaintiff’s “readiness and willingness” to perform, as required by Section 16(c) of the Specific Relief Act, 1963.
  2. Whether the substantial rise in the property’s value during pendency of litigation justifies refusing specific performance and confining the plaintiff to damages instead.

Arguments of the Parties

Appellant-Defendant’s Arguments

  • Invoked Section 16(c) of the Specific Relief Act, contending that, in the absence of explicit pleadings of “readiness and willingness,” specific performance cannot be granted.
  • Cited Kanshi Ram v. Om Prakash Jawal, (1996) 4 SCC 593, to urge that the steep increase in the property’s price during the lawsuit warranted denial of specific performance and award of damages instead.

Respondent-Plaintiff’s Position

The opinion does not record separate, detailed submissions from the respondent; the Court’s analysis relies on the respondent’s conduct and documentary evidence demonstrating continuous readiness and willingness.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Kanshi Ram v. Om Prakash Jawal (1996) 4 SCC 593 The discretionary nature of granting specific performance; courts may deny the decree when property prices have substantially escalated and instead award damages. The Court acknowledged the citation but declined to deny specific performance solely on price escalation. Instead, it ordered monetary compensation of ₹1,00,000 to the appellant while maintaining the decree for specific performance.

Court's Reasoning and Analysis

Interpreting Section 16(c) of the Specific Relief Act, the Court held that the statute does not mandate any “specific phraseology.” What is required is that, in substance, the plaintiff aver and establish continuous readiness and willingness to perform contractual obligations. The Court emphasized that compliance is a question of “spirit and substance, not letter and form.”

Examining the record, the Court noted:

  • Repeated extensions of the deadline were granted at the appellant’s request.
  • The respondent filed suit promptly after the appellant’s final default (26-11-1987).
  • The respondent deposited the entire sale consideration in court on 18-05-1999 and appeared at the Registrar’s office ready to register the sale deed; the appellant did not appear.

These facts demonstrated the respondent’s persistent readiness and willingness. Consequently, the decrees of the lower courts contained no infirmity.

Addressing the appellant’s argument on price escalation, the Court accepted that some delay was attributable to the respondent but found it insufficient to defeat specific performance. As an equitable adjustment, it ordered the respondent to pay an additional ₹1,00,000 to the appellant within three months, failing which the suit for specific performance would stand dismissed automatically.

Holding and Implications

HOLDING: The civil appeal is dismissed. The decree for specific performance stands, subject to the condition that the respondent pays the appellant ₹1,00,000 within three months, failing which the suit will automatically stand dismissed. Upon payment, the appellant must execute the sale deed and deliver vacant possession, and may withdraw the consideration already deposited in court. No order as to costs.

Implications: The judgment reaffirms that a plaintiff’s readiness and willingness under Section 16(c) need not be articulated in any set formula; it can be inferred from the totality of conduct and pleadings. While acknowledging market fluctuations, the Court preserved the remedy of specific performance, opting instead to grant an equitable monetary adjustment. The decision does not purport to create new precedent but clarifies the flexible application of Section 16(c) and the Court’s discretion to balance equities without denying the substantive relief.

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    Faquir Chand And Another v. Sudesh Kumari .

    Dr. Ar. Lakshmanan, J.— Leave granted.

    2. The unsuccessful defendant is the appellant before us. The respondent herein filed a suit for specific performance or in the alternative for damages. All the three courts below, on a consideration of the entire materials placed, both oral and documentary, decreed the suit for specific performance. Before us, Mr Amar Vivek, learned counsel for the appellants argued that in the absence of pleadings to readiness and willingness to execute a sale deed, the suit for specific performance of an agreement cannot be decreed. We have carefully gone through the judgments rendered by the three courts below. The High Court on a consideration of the entire material placed before it was of the view that no interference was called for in the second appeal.

    3. The learned counsel for the appellant at the time of hearing, placed reliance on Section 16 of the Specific Relief Act. In order to appreciate the rival submissions, Section 16(c) needs to be quoted along with explanation. The same reads as follows:

    “16. Personal bars to relief.—***
    (a)-(b)***
    (c) who fails to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than terms the performance of which has been prevented or waived by the defendant.
    Explanation.—For the purposes of clause (c),—
    (i) where a contract involves the payment of money, it is not essential for the plaintiff to actually tender to the defendant or to deposit in court any money except when so directed by the court;
    (ii) the plaintiff must aver performance of, or readiness and willingness to perform, the contract according to its true construction.”

    4. The language under Section 16(c) of the Act, in our view, does not require any specific phraseology but only that the plaintiff must aver that he has performed or has always been ready and willing to perform his part of the contract. Therefore, the compliance with the readiness and willingness has to be in spirit and substance and not in letter and form. The continuous readiness and willingness could very well be seen in the instant case from the conduct of the plaintiff as a whole. The first agreement was entered into between the parties on 17-6-1985 and the last date to execute the sale deed was 14-11-1985. The second agreement was executed on 9-4-1987 and the last date to execute the sale deed was 13-6-1987. Again, the time was extended at the instance of the defendant up to 30-10-1987. Since the sale deed was not executed, the respondent herein was compelled to file the suit on 26-11-1987. Thereafter, the appellant herein issued a notice to the plaintiff, the respondent herein, on 7-1-1988 and at Exhibit P-5. It is also not in dispute that the respondent herein has deposited the entire sale consideration into the Court on 18-5-1999. He was also present in the Registrar's office for registration of the document. However, the appellant-defendant was not present at the Registrar's office. A careful perusal of the pleadings, the evidence and the documents filed in this case would only go to show that the respondent-plaintiff was ever ready and willing to perform his part of the obligation under the agreement. The decree passed by the High Court confirming the decree of the lower courts does not suffer from any infirmities. We, therefore, have no hesitation to dismiss the appeal.

    5. The learned counsel for the appellant cited judgment of this Court in Kanshi Ram v. Om Prakash Jawal (1996) 4 SCC 593 and submitted that the rise in price of the property during the pendency of the suit should also be taken into consideration and that the courts below ought to have refused to decree the suit for specific performance and ought to have exercised its jurisdiction in passing an order of granting alternative prayer for damages. It is now submitted at the Bar that the property value has gone up several times and that if the property is sold it would fetch more than Rs 65-70 lakhs. We do not propose to go into the correctness of this submission in regard to the valuation of the suit property. To some extent, the delay is also attributable to the respondent herein. Therefore, in our view, the appellant-defendant is to be suitably compensated. We, therefore, direct the respondent herein to pay to the appellant herein a sum of Rs 1,00,000 (Rupees one lakh only) within three months from today, failing which the suit filed by the respondent herein for specific performance shall stand dismissed automatically. If the amount is paid within the time as stipulated, the appellant herein shall execute the sale deed in favour of the respondent herein without any further delay. We also make it clear that on execution of the sale deed, the appellant-defendant shall also hand over peaceful vacant possession of the suit property to the respondent herein. The appellant-defendant will be at liberty to withdraw the amount, which has already been deposited by the respondent in the Court.

    6. The civil appeal stands disposed of accordingly with no orders as to costs.

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    Comments

    Faquir Chand And Another v. Sudesh Kumari .
    (Sep 21, 2006)