Supreme Court Denies Specific Performance; Awards Damages with Interest in Land Sale Dispute. Discretionary Relief Denied Due to False Statements and Lack of Readiness

Case Note & Summary

1. Introduction & Background

The Supreme Court of India addressed the appeal filed by the plaintiffs (Major General Darshan Singh's legal heirs) regarding a dispute over the execution of a sale agreement for a property owned by the defendant (Brij Bhushan Chaudhary). The property in question was located in Chandigarh, measuring approximately 2438 sq. yards.

2. Facts of the Case Sale Agreement: On January 16, 1980, the defendant executed an agreement to sell the property for ₹3,50,000, with ₹30,000 paid as earnest money. The sale was to be completed by April 30, 1980. Altered Negotiations: The plaintiffs claimed the price was reduced to ₹2,90,000, and a draft sale deed was executed on March 18, 1980. They alleged possession was handed over, and stamp papers were purchased as per the defendant's instructions. Defendant's Refusal: The defendant allegedly reneged on the deal due to rising property prices. Despite telegraphic notices from the plaintiffs, he did not appear for registration. This led to the plaintiffs filing a suit for specific performance or, alternatively, damages. 3. Trial Court’s Decision The court refused specific performance but awarded ₹40,000 in damages. It was held that the suit property was Hindu Undivided Family (HUF) property and that the plaintiffs had failed to prove any fresh agreement for a reduced price. The court noted that plaintiffs 2 to 4 were not parties to the agreement and therefore could not seek specific performance. 4. Appellate Decisions District Court: Dismissed the plaintiffs' appeal, upholding the trial court's findings. High Court: Also dismissed the appeal, emphasizing that the property was HUF and could not be sold without legal necessity or co-sharers’ consent. 5. Arguments in Supreme Court The plaintiffs argued that they were entitled to specific performance for the defendant's undivided share. The defendant’s counsel contended that the plaintiffs’ conduct did not merit equitable relief. 6. Supreme Court’s Analysis Discretionary Relief: The court noted that specific performance under Section 20 of the Specific Relief Act, 1963, is discretionary. Given the plaintiffs' false statements and suppression of facts (e.g., misrepresenting the property status and possession details), they were deemed undeserving of such relief. HUF Property: The court highlighted that despite the plaintiffs knowing the property was HUF, they proceeded to claim the entire property without involving the co-sharers. Damages Award Modification: The court allowed damages of ₹40,000, with 6% interest per annum from the trial court’s decree date until payment. 7. Acts and Sections Discussed Specific Relief Act, 1963: Section 12: Partial performance. Section 16(c): Readiness and willingness requirement. Section 20: Discretion for specific performance. Urban Land (Ceiling and Regulation) Act, 1976. Capital of Punjab (Development and Regulation) Act, 1952: Used to establish the status of the property as HUF. 8. Ratio Decidendi

The court held that the relief of specific performance is discretionary and must be supported by truthful conduct. Since the plaintiffs failed to demonstrate this, the court denied specific performance and modified the decree only to grant interest on the damages.

Subjects:

Property Law, Specific Performance, Hindu Undivided Family, Equitable Relief, Urban Land Regulation, Supreme Court Judgment.