Case Note & Summary
The Supreme Court allowed the appeal filed by Canara Bank (plaintiff) against the judgment of the Division Bench of the Delhi High Court which had reversed the decree for specific performance granted by the Single Judge. The dispute arose from an Agreement to Sell dated 27.12.1984, whereby the defendant, K.L. Rajgarhia, agreed to sell a property in East of Kailash, Delhi, with construction of eight flats, for a total consideration of ₹32,07,500. The plaintiff paid about 90% of the consideration (₹28,86,750). The defendant failed to complete construction within the stipulated 18 months plus six months grace period, and did not hand over possession. The plaintiff filed a suit for specific performance. The Single Judge decreed the suit, directing execution of a registered sale deed. The Division Bench reversed this, dismissing the suit for specific performance but ordering refund of consideration. The Supreme Court held that the Division Bench erred in its appreciation of evidence regarding the plaintiff's readiness and willingness, and the defendant's conduct. The Court restored the decree for specific performance, emphasizing that the plaintiff had always been ready and willing to perform its part, and the defendant's failure to complete construction was a breach. The appeal was allowed, setting aside the Division Bench's order and restoring the Single Judge's decree.
Headnote
A) Specific Performance - Agreement to Sell - Readiness and Willingness - Section 16(c) Specific Relief Act, 1963 - The plaintiff must prove continuous readiness and willingness to perform his part of the contract. In the present case, the plaintiff had paid about 90% of the consideration and was always ready to pay the balance. The Division Bench erred in holding otherwise without considering the evidence on record. (Paras 1-10) B) Specific Performance - Conduct of Parties - Section 20 Specific Relief Act, 1963 - The court has discretion to grant specific performance, but it must be exercised judicially considering the conduct of the parties. The defendant's failure to complete construction and hand over possession despite receiving substantial consideration disentitled him from resisting the decree. The Division Bench's reversal was not justified. (Paras 11-20)
Issue of Consideration
Whether the Division Bench of the Delhi High Court was justified in reversing the decree for specific performance granted by the Single Judge, particularly in light of the plaintiff's readiness and willingness and the defendant's conduct.
Final Decision
The Supreme Court allowed the appeal, set aside the Division Bench's order, and restored the decree for specific performance passed by the Single Judge.
Law Points
- Specific Performance
- Agreement to Sell
- Readiness and Willingness
- Conduct of Parties
- Section 16(c) Specific Relief Act
- 1963
- Section 20 Specific Relief Act
