Prakash Chandra Vs.
Civil Appeal No. 8102
of 2011 arising out of SLP (C) No.21139 of 2007)
J U D G M E N T
was granted on 22.9.2011.
appeal has been preferred by the appellant-plaintiff against the judgment and
order dated 6th March, 2007 passed by the learned Single Judge of the High
Court of Judicature of Mumbai, Nagpur Bench in Second Appeal No.198 of 2006,
whereby the judgment and decree passed by the District Court, Pandharkawada
(Kelapur) in Regular Civil Appeal No.129 of 2002 came to be confirmed.
first appellate court by the aforesaid judgment and decree reversed the
judgment and decree dated 23rd September, 1998 and 3rd October, 1998 in Special
Civil Suit No.175 of 1997 which was preferred by the appellant-plaintiff for
suit in question was filed by the appellant against the respondent for specific
performance of agreement for sale dated 18th April, 1996 in respect of
agricultural land admeasuring 1 H. 61Are. at a price of Rs.51,000/-. It was the
case of the appellant that he had paid the earnest money of Rs.39,000/- while
the balance amount was to be paid on the date of execution of the sale deed
which was fixed for 18th March, 2007, but despite the appellant being present for
the purpose of completion of the formalities of agreement for sale, the respondent
did not turn up. Consequently, the appellant purchased a stamp paper of
Rs.100/- on 18th March, 1997 and issued a notice to the respondent on 2nd
April, 1997 and called upon him to execute the sale deed dated 21st April, 1997
but a false reply was given by the respondent on 15th April, 1997. As the
respondent refused to perform his part of the contract, the appellant filed
Special Civil Suit No.175 of 1997 for specific performance of contract, and alternatively
to refund the earnest money.
respondent contested the case claiming that his signatures were obtained on a
blank stamp paper for the outstanding money of Rs.12,000/- for the purchase of fertilizers
and clothes etc. The trial court by its judgment dated 23rd September, 1998 and
decree dated 3rd October, 1998 decreed the suit for specific performance.
appreciation of the material on record, the trial court held that the appellant
had proved that the respondent agreed to sell the suit land for consideration
of Rs.51,000/- by executing an agreement for sale on 18th April, 1996 and that
he had paid earnest money of Rs.39,000/- to the respondent. The respondent
failed to prove that he had signed on a blank Stamp paper in the presence of Vithal
Sitaram Thaori. On the other hand there is sufficient material on record to show
that the appellant was ready and willing to perform his part of the contract
and, therefore, the appellant is entitled to the decree for specific
performance of contract while the alternative prayer needs no consideration.
The respondent is not entitled to compensatory cost. All the six issues were
decided in favour of the appellant and against the respondent with a direction
to the respondent to execute the sale deed on or before 31st August, 1998 in
respect of the suit land i.e. southern portion of the land admeasuring 1 H
61Are having Gat No.1/2 situated at village Khadki on payment of the balance consideration
of Rs.12,000/-. The Court also directed the respondent to deliver the possession
of the suit land to the appellant with the clear condition that in the event of
the respondent failing to execute the sale deed on or before the fixed date,
the appellant will deposit the balance amount in the Court to get the sale deed
respondent took up the matter vide first appeal before the District Court. The
following questions were framed for determination: 1) Whether the defendant has
agreed to sell and the plaintiff has agreed to purchase the suit property for consideration
of Rs.51,000/- on 18.4.1996? 2) Whether the defendant has signed Ex.25 blank Stamp
paper in lieu of the credit amount of the plaintiff towards the clothes and
fertilizers? 3) Whether the plaintiff was and is ready and willing to perform his
part of the contract? 4) Whether the defendant has failed to perform his part of
the contract? 5) Whether it is necessary to interfere with the impugned
judgment and decree? 6) What order and relief?
first appellate court on hearing the parties and on appreciation of the
material on record answered all the issues in favour of the appellant but
reversed the judgment and decree thereby allowing discretion in favour of the
respondent by directing him to pay the earnest money with interest. Referring
Clause (b) of sub-section (2) of Section 20 of Specific Relief Act, the First
Appellate Court held as follows: 20. Having regard to the facts on the record,
it is evident from the evidence of the defendant and also an admitted fact that
the defendant was having the only suit land and he would be landless if the
decree would be granted for specific performance. On the other hand, the
plaintiff is having landed properties and all the riches including the business
of clothes and fertilizers. Therefore these aspects are not considered by the learned
lower court, while exercising the discretion, in granting the decree for specific
performance. The amount of Rs.12,000/- were not paid or deposited to the
defendants favour since the agreement for sale till the date of decree.
Therefore having regard to all these circumstances and facts on the record, this
Court is of the opinion that this Court should interfere in the discretion exercised
by the learned lower court while granting the decree for specific performance.
The hardship would be, in all probabilities and facts and circumstances caused to
the defendant than the plaintiff. In the result, the court is of the opinion that
alternative relief for refund of the earnest amount of Rs.39,000/- to the
plaintiff by the defendant, would meet the ends of justice. The same can be
utilized and exercised by awarding the damages by way of an interest on the
the matter was taken up in the second appeal, the learned Single Judge vide
impugned judgment dated 6th March, 2007 dismissed the second appeal on the ground
that the first appellate court has factually found that the respondent would be
landless as against the appellant who is having various businesses as well.
to the learned counsel for the appellant, there was no impediment in according a
relief of specific performance particularly when all the issues have been
decided in favour of the appellant and against the respondent. He further
submitted that, in the absence of any defence taken by the respondent that he
would become landless if the relief for specific performance is granted and in absence
of any material on record, the finding of the first appellate court cannot be
counsel for the appellant referring to the cross- examination of the respondent
contended that the respondent would not become landless as is evident from the
fact that after the agreement reached with the appellant, he sold 4 acres of land
to one Dilip Karekar. Even thereafter the respondent is having 2.25 H of cultivable
land apart from 0.88 H uncultivable land.
to the learned counsel for the respondent, as hardship would be caused to the respondent,
the appellate court rightly held that it would sub-serve the ends of justice if
the entire amount of earnest money received by the respondent is directed to be
paid back to appellant along with interest.
have heard the learned counsel for the parties. The learned counsel appearing
on either side elaborately took us through the findings of the trial court, the
first appellate court as well as the High Court in second appeal. From the materials
on record and the agreement dated 18th April, 1996 and from the judgment of the
trial court and the first appellate court, it is evident that no issue relating
to the hardship of the respondent was framed. In a case of Specific
performance, hardship is a good defence provided such defence is taken by the
defendant and evidence in support of such defence is brought on record, while
in this case no such defence was taken by the respondent and no evidence was
brought on record in its support.
appellant has specifically pleaded that the respondent possessed agricultural
land admeasuring 5 H. 76.R. in Gat No. ½, which has not been denied by the
respondent. The appellant proved that an agreement was reached between the
parties on 18th April, 1996 to sell southern portion of land admeasuring 1.61
H. by making an east-west boundary for the consideration of Rs. 51,000/- for
which appellant had paid Rs.39,000/- to the respondent as earnest money. The appellant
also proved that he was always ready and willing to perform his part of the
contract. These issues were decided in favour of the appellant. During
cross-examination the respondent stated that he sold only 4 acres of land
during the pendency of the case, thereby remaining 2.25 H cultivable and 0.88 H
uncultivable land is still available with the respondent.
question as to whether the grant of relief for specific performance will cause
hardship to the defendant within the meaning of Clause (b) of sub-section (2)
of Section 20 of the Specific Relief Act, 1963, being a question of fact, the first
appellate court without framing such an issue ought not to have reversed the finding
of the trial court while concurring with it on all other issues with regard to the
appellants entitlement to relief for specific performance of contract. The
High Court in the second appeal failed to notice that the respondent had not
taken any defence of hardship and no such issue was framed and in absence of any
such evidence on record, the first appellate court held that he would be
landless should the decree for specific performance be granted.
the reasons stated above, we are of the view that the appellant is entitled to
the specific performance of agreement for sale, as ordered and decreed by the trial
court. The appeal is accordingly allowed. The order passed by the High Court in
the second appeal and the judgment and decree passed by the first appellate court
are set aside. The judgment and decree passed by the Trial Court is affirmed.
The appellant is allowed two months to pay the balance consideration to the respondents.
If the respondent fails to execute the sale deed, such amount will be deposited
in the trial court which will ensure the execution of the sale deed as per its judgment
( G.S. SINGHVI )
( SUDHANSU JYOTI MUKHOPADHAYA)