Bombay High Court Allows Second Appeal in Specific Performance Suit — Restores Trial Court Decree for Specific Performance of Agreement to Sell. Delivery of Possession Under Agreement Constitutes Part Performance, Entitling Purchaser to Specific Performance Under Specific Relief Act, 1963.

High Court: Bombay High Court In Favour of Accused
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Case Note & Summary

The case involves two second appeals arising from cross-suits between Dadasaheb Dhondiba Jagtap (appellant) and Anant Shivram Poman (respondent) concerning an agreement to sell dated 12.6.1972 for a share of land bearing Survey No.114 at Village Supla, Pune. The respondent agreed to sell 2 Ane 5 paisa share to the appellant for Rs.14,000/-. The appellant had paid Rs.3,000/- on 24.4.1972 and an additional Rs.2,000/- on the date of agreement, totaling Rs.5,000/- as earnest money. Possession of the suit property was handed over to the appellant on the same day. The appellant filed Regular Civil Suit No.101 of 1980 for specific performance, while the respondent filed Regular Civil Suit No.131 of 1982 for possession and damages. The trial court (CJJD, Saswad) decreed specific performance in favour of the appellant and dismissed the respondent's suit. On appeal, the 3rd Additional District Judge, Pune, allowed both appeals, setting aside the decree for specific performance and decreeing the respondent's suit for possession. The appellant then filed these second appeals. The High Court framed the issue of whether the decree for specific performance was rightly granted. The court noted that the agreement was in writing, possession was delivered, and earnest money was paid. The court held that the appellant was ready and willing to perform his part, and the suit was within limitation. The High Court allowed the appeals, set aside the judgment of the first appellate court, and restored the trial court's decree for specific performance, directing the respondent to execute the sale deed upon payment of the balance consideration.

Headnote

A) Specific Relief Act, 1963 - Section 10 - Specific Performance of Contract - Agreement to Sell - Part Performance - The plaintiff agreed to sell 2 Ane 5 paisa share of suit land to defendant for Rs.14,000/- and received Rs.5,000/- as earnest money. Possession was handed over to defendant on the date of agreement. The trial court decreed specific performance, but the first appellate court set it aside. The High Court restored the decree, holding that delivery of possession under the agreement constitutes part performance and the plaintiff was ready and willing to perform his part. (Paras 1-10)

B) Limitation Act, 1963 - Article 54 - Suit for Specific Performance - Limitation Period - The agreement was executed on 12.6.1972. The suit was filed in 1980. The court held that the suit was within limitation as the plaintiff was in possession and the cause of action continued. (Paras 2-5)

C) Evidence Act, 1872 - Section 91 - Exclusion of Oral Evidence - The agreement was in writing and contained terms. The court relied on the written agreement and the fact of possession to infer part performance. (Paras 3-6)

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Issue of Consideration

Whether the decree for specific performance of an agreement to sell was rightly granted by the trial court and whether the appellate court erred in setting it aside.

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Final Decision

Both second appeals are allowed. The judgment and order of the 3rd Additional District Judge, Pune, dated 18th July 2005 in Civil Appeal No.196 of 1987 and Civil Appeal No.197 of 1987 are set aside. The decree passed by the Court of CJJD, Saswad, in Regular Civil Suit No.101 of 1980 is restored. The respondent is directed to execute the sale deed in favour of the appellant upon payment of the balance consideration within a period of three months. No order as to costs.

Law Points

  • Specific performance
  • Agreement to sell
  • Part performance
  • Possession
  • Earnest money
  • Limitation
  • Readiness and willingness
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Case Details

2005 LawText (BOM) (07) 147

Second Appeal No.486 of 1994 with Second Appeal No.489 of 1994

2005-07-18

S.R. Sathe, J.

Mr. S.J. Rairkar for the appellant, Mr. C.G. Gavnekar for the respondent

Dadasaheb Dhondiba Jagtap

Anant Shivram Poman

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Nature of Litigation

Civil suit for specific performance of an agreement to sell and cross-suit for possession and damages.

Remedy Sought

Appellant (original plaintiff) sought specific performance of agreement to sell; respondent (original plaintiff in cross-suit) sought possession and damages.

Filing Reason

Respondent failed to execute sale deed despite receiving earnest money and handing over possession.

Previous Decisions

Trial court decreed specific performance in favour of appellant and dismissed respondent's suit. First appellate court set aside trial court decree and decreed respondent's suit for possession.

Issues

Whether the decree for specific performance was rightly granted by the trial court. Whether the suit was within limitation. Whether the appellant was ready and willing to perform his part of the contract.

Submissions/Arguments

Appellant argued that he paid earnest money and was put in possession, and he was ready and willing to pay balance. Respondent argued that the agreement was not valid and that the suit was barred by limitation.

Ratio Decidendi

Delivery of possession under an agreement to sell, coupled with payment of earnest money, constitutes part performance sufficient to sustain a decree for specific performance. The plaintiff's readiness and willingness is presumed when he files a suit for specific performance and is in possession.

Judgment Excerpts

The appellant had paid Rs.3000/- to respondent on 24.4.1972. On the date of the agreement he paid an additional amount of Rs.2000/- and thus the respondent agreed that out of the sale price of Rs.14,000/- he received Rs.5000/- towards the transaction by way of earnest money. On the date of the agreement the respondent handed over possession of the suit property to the Appellant.

Procedural History

Regular Civil Suit No.101 of 1980 filed by appellant for specific performance; Regular Civil Suit No.131 of 1982 filed by respondent for possession. Trial court decreed specific performance and dismissed respondent's suit. Appeals: Civil Appeal No.196 of 1987 and Civil Appeal No.197 of 1987 were allowed by 3rd Additional District Judge, setting aside trial court decree. Hence, these second appeals.

Acts & Sections

  • Specific Relief Act, 1963: Section 10
  • Limitation Act, 1963: Article 54
  • Evidence Act, 1872: Section 91
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