Case Note & Summary
The appeal arose from a suit for specific performance of an agreement for sale dated 16th January 1980 executed by the defendant (Brij Bhushan Chaudhary) in favour of plaintiff no.1 (Major General (retd) Darshan Singh) for a plot of land in Chandigarh. The agreed consideration was Rs.3,50,000, with Rs.30,000 paid as earnest money. The agreement contained a clause limiting the defendant's liability to refund of earnest money plus Rs.10,000 damages, and barring a suit for specific performance. The plaintiffs alleged that after the agreement, the price was reduced to Rs.2,90,000 and a draft sale deed was executed on 18th March 1980, under which possession was handed over. The defendant denied these allegations and contended that the property belonged to his Hindu Undivided Family (HUF). The Trial Court declined specific performance but awarded damages of Rs.40,000 to plaintiff no.1, dismissing the suit of the other plaintiffs. The First Appellate Court and the High Court affirmed. The Supreme Court examined the conduct of the plaintiffs, noting that the plaint suppressed the fact that the property was HUF property, despite the draft sale deed relied upon by the plaintiffs describing the defendant as Karta of HUF. The first plaintiff in cross-examination admitted that the property was HUF property and that he never took possession on 18th March 1980, contradicting the plaint. The Court held that the grant of specific performance is discretionary under Section 20 of the Specific Relief Act, 1963, and a person seeking equity must do equity. The conduct of the plaintiffs, including suppression of material facts and inconsistent pleadings, disentitled them to the equitable relief of specific performance. The concurrent findings of readiness and willingness did not override the requirement of good conduct. The appeal was dismissed.
Headnote
A) Specific Relief Act, 1963 - Section 20 - Discretionary Relief - Conduct of Plaintiff - The grant of a decree for specific performance is discretionary and equitable; a person seeking equity must do equity. The conduct of the plaintiff is a crucial factor. In this case, the plaintiff suppressed the fact that the suit property was HUF property and made inconsistent pleadings regarding possession and price reduction, disentitling him to equitable relief. (Paras 9-12)
B) Specific Relief Act, 1963 - Section 16(c) - Readiness and Willingness - Concurrent findings of readiness and willingness in favour of the plaintiff do not automatically entitle him to specific performance if his conduct is inequitable. (Paras 7, 9)
C) Hindu Undivided Family - HUF Property - Sale by Karta - The suit property was HUF property, and the defendant executed the agreement as Karta. The plaintiff knew this but suppressed it in the plaint, which is a material suppression affecting the grant of specific performance. (Paras 10-11)
D) Specific Relief Act, 1963 - Section 12 - Part Performance - The argument that a decree for specific performance can be granted for the undivided share of the defendant was considered but not applied due to the plaintiff's conduct. (Para 7)
Issue of Consideration
Whether the plaintiffs are entitled to a decree of specific performance of an agreement for sale of HUF property, given the conduct of the plaintiffs and the nature of the property.
Final Decision
The Supreme Court dismissed the appeal, holding that the conduct of the plaintiffs, including suppression of the fact that the suit property was HUF property and inconsistent pleadings regarding possession and price reduction, disentitled them to the equitable relief of specific performance. The concurrent findings of readiness and willingness did not override the requirement of good conduct. The judgment of the High Court was affirmed.
Law Points
- Specific performance is discretionary
- equitable relief
- conduct of plaintiff
- suppression of facts
- HUF property
- Section 20 Specific Relief Act 1963
- Section 16(c) Specific Relief Act 1963
- Section 12 Specific Relief Act 1963
Case Details
Civil Appeal No. 1234 of 2020
Puja Sharma, Mohit Chaudhary, Puja Sharma, Kunal Sachdeva, Madhuri Jain, Prakhar Mithal, Srishti Bajpai, Aashish Arya, Jyoti Mendiratta, Ananya Basudha, Ravinder Pal Singh, Sudhansu Palo, Prasant Varma, Rakesh Kumar Palo, Ipsita Behura, Geeta Verma
Darshan Singh (since deceased) through LRs and others
Brij Bhushan Chaudhary (since deceased) through LRs
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Nature of Litigation
Civil suit for specific performance of an agreement for sale of immovable property, with alternative claim for damages.
Remedy Sought
The plaintiffs sought a decree of specific performance of the agreement for sale dated 16th January 1980, or in the alternative, damages of Rs.40,000.
Filing Reason
The defendant failed to execute the sale deed despite receipt of earnest money and alleged further negotiations, and the plaintiffs claimed readiness and willingness to perform their part.
Previous Decisions
The Trial Court declined specific performance but awarded damages of Rs.40,000 to plaintiff no.1. The First Appellate Court dismissed the appeal. The High Court in second appeal confirmed the decrees, holding the property was HUF property and impartible under the Capital of Punjab (Development and Regulation) Act, 1952.
Issues
Whether the plaintiffs are entitled to a decree of specific performance of the agreement for sale of HUF property.
Whether the conduct of the plaintiffs disentitles them to the equitable relief of specific performance under Section 20 of the Specific Relief Act, 1963.
Submissions/Arguments
Appellants argued that concurrent findings on readiness and willingness were in their favour, and a decree for specific performance could be granted for the undivided share of the defendant in the HUF property, relying on Sections 12 and 22(1)(a) of the Specific Relief Act, 1963, and precedents like Hardeo Rai v. Sakuntala Devi and Surinder Singh v. Kapoor Singh.
Respondent argued that the conduct of the plaintiffs, including suppression of facts and inconsistent pleadings, required the court to exercise discretion against them under Section 20 of the Specific Relief Act, 1963, and that three courts had already held against the plaintiffs.
Ratio Decidendi
The grant of a decree for specific performance is discretionary and equitable under Section 20 of the Specific Relief Act, 1963. A plaintiff seeking equity must do equity and must come with clean hands. Suppression of material facts, such as the HUF nature of the property, and inconsistent pleadings regarding possession and price reduction constitute conduct that disentitles the plaintiff to the equitable relief of specific performance, even if readiness and willingness are established.
Judgment Excerpts
Under Section 20 of the 1963 Act, the grant of a decree for specific performance is always discretionary. The exercise of discretion depends on several factors. One of the factors is the conduct of the plaintiff. The reason is that relief of a decree of specific performance is an equitable relief. A person who seeks equity must do equity.
Though the first plaintiff knew that the suit property was HUF property, this fact was suppressed in the plaint.
In his examination-in-chief, the first plaintiff asserted that the terms and conditions of the suit agreement at Exhibit P-4 were never varied after its execution. Therefore, he did not come out with the case in his evidence that there was a further agreement under which the price of the property was reduced to Rs.2,90,000/-. Thus, to the knowledge of the first plaintiff, the case pleaded in the plaint regarding the price reduction was factually incorrect.
In the cross-examination, the first plaintiff specifically admitted that he never took possession of the suit property on 18th March 1980.
Procedural History
The plaintiffs filed a suit for specific performance in the Trial Court, which was dismissed except for damages of Rs.40,000 to plaintiff no.1. The plaintiffs appealed to the District Court (First Appellate Court), which dismissed the appeal. The plaintiffs then filed a second appeal in the High Court, which was dismissed. The plaintiffs appealed to the Supreme Court by special leave.
Acts & Sections
- Specific Relief Act, 1963: 12, 16(c), 20, 22(1)(a)
- Urban Land (Ceiling and Regulation) Act, 1976:
- Capital of Punjab (Development and Regulation) Act, 1952:
