2023 LiveLaw (SC) 31

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION
M.R. SHAH, J., B.V. NAGARATHNA; J.
CIVIL APPEAL NO. 4072 OF 2022; 13 JANUARY, 2023
C. Haridasan versus Anappath Parakkattu Vasudeva Kurup & Others
Specific Relief Act, 1963 - Suit for specific performance of agreement to sell -
Supreme Court bench comprising Justices MR Shah and BV Nagarathna delivers a
split verdict on whether the plaintiff is entitled to the decree of specific relief.
In view of difference of opinion in the matter, Registry is directed to place the papers before Hon’ble the
Chief Justice of India for appropriate orders for constituting a larger Bench to decide the controversy.
For Appellant(s) Mr. Mks Menon, Adv. Ms. Usha Nandini V., AOR Mr. Biju P Raman, Adv. Mr. Shashank
Menon, Adv. Mr. Ravi Lamod, Adv. Mr. Arun Kumar Jaiswal, Adv.
For Respondent(s) Mr. Raghenth Basant, Adv. Ms. Rashmi Nandakumar, AOR Ms. Roopali Lakhotia, Adv.
JUDGMENT
M.R. SHAH, J.
1. Feeling aggrieved and dissatisfied with the impugned judgment and order dated
03.11.2021 passed by the High Court of Kerala at Ernakulam in Regular First Appeal No.
63 of 2009, by which the High Court has allowed the said appeal preferred by the original
defendants and has set aside the judgment and decree dated 18.08.2008 passed by the
learned trial Court in Original Suit No. 205/2006, decreeing the suit for specific
performance, the original plaintiff has preferred the present appeal.
2. That the plaintiff and the defendants entered into an agreement to sell dated
07.08.2005 under which the defendants agreed to sell the land in question for a
consideration of Rs. 8,750/- per cent. The plaintiff paid an amount of Rs. 10,000/- as
advance towards the part sale consideration amount. The balance consideration was
agreed to be paid by the plaintiff within six months from the date after measuring the
property provided the defendants make available the documents of title including the
purchase certificate under the Kerala Land Reforms Act.
2.1 That thereafter, the plaintiff served a legal notice dated 02.11.2006 upon the
defendants to execute the sale deed to which the defendants sent reply and refused to
execute the sale deed and cancelled the agreement to sell. Therefore, the appellant herein
– original plaintiff instituted a Suit being Original Suit No. 205/2006 before the learned trial
Court for specific performance of agreement to sell and in the alternative return of the
plaintiff’s amount with interest.
2.2 The said suit was resisted by the defendants by filing written statement. It was
denied that the plaintiff was ever ready and willing to perform his part of the contract. It
was also submitted that the suit was filed after one year from the date of expiry of the
agreement. It was the case on behalf of the defendants that defendant No.1 was a heart
patient and he had undergone the surgery on which huge amount was spent which was
borrowed from others and therefore to clear off the said liability, the defendants agreed to
sell the property in question. It was also the case of the defendants that even though the
defendants had approached the plaintiff to pay some more money, he was not prepared
for the same, thereby defendants had been compelled to sell the gold ornaments and clear
the liabilities. It was submitted that the defendants were always ready and willing to
perform their part of the agreement.

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2.3 The learned trial Court framed the following issues:
“1. Whether plaintiff had performed his part of the contract, thereby entitling him for specific
performance of the agreement?
2. Whether plaintiff has got any cause of action against defendants?
3. Whether the plaintiff is entitled to the reliefs sought?
4. Relief and costs?”
2.4 On appreciation of the entire evidence on record, the learned trial Court decreed
the suit for specific performance of agreement to sell dated 07.08.2005. However, at the
same time and to do complete justice between the parties, the learned trial Court directed
the plaintiff to pay 25% more amount, over and above the agreed consideration i.e., sale
consideration at the rate of Rs. 11,000/- per cent (Rs. 8750/- per cent + 25% = 10,037/-,
rounded off to Rs. 11,000/-). The learned trial Court also directed the plaintiff to deposit
the balance sale consideration, i.e., Rs. 3,97,000/-, within a period of two months.
2.5 Feeling aggrieved and dissatisfied with the judgment and decree passed by the
learned trial Court decreeing the suit for specific performance of agreement to sell dated
7.8.2005, the defendants preferred an appeal before the High Court. Without upsetting
the findings recorded by the learned trial Court on execution of agreement to sell dated
7.8.2005; payment of part sale consideration and the other issues held in favour of the
plaintiff, straightway the High Court considered Section 20 of the Specific Relief Act and
opined that the trial Court was not justified in enhancing the sale consideration and ought
not to have exercised the discretion in favour of the plaintiff. By the impugned judgment
and order, the High Court, while relying upon and/or considering Section 20 of the Specific
Relief Act, has partly allowed the appeal and has set aside the judgment and decree for
specific performance and has directed the defendants to pay Rs. 3,10,000/- to the plaintiff.
2.6 Feeling aggrieved and dissatisfied with the impugned judgment and order passed
by the High Court, setting aside the judgment and decree passed by the learned trial Court
for specific performance of agreement to sell, the original plaintiff has preferred the present
appeal.
3. It is vehemently submitted by the learned counsel appearing on behalf of the
appellant that in the facts and circumstances of the case, the High Court has committed
an error in reversing the decree of specific performance.
3.1 It is submitted that the execution of the agreement to sell and receipt of part sale
consideration have not been disputed by the defendants.
3.2 It is submitted that as per the conditions mentioned in the agreement to sell, the
balance sale consideration was required to be paid within a period of six months form the
date after measuring the property provided the defendants make available the documents
of title including the purchase certificate under Kerala Land Reforms Act, which was yet
to be obtained.
3.3 It is submitted that even the purchase certificate was issued by the Government
during the pendency of the suit. It is submitted that therefore once the execution of
agreement to sell is admitted and the part sale consideration is received and it was found
that the plaintiff was always ready and willing to perform his part of the contract, the
learned trial Court was justified in decreeing the suit for specific performance.
3.4 It is then submitted that even, though not required, the learned trial Court enhanced
the sale consideration to do complete justice, which the plaintiff agreed. It is submitted
that enhancement of the sale consideration by the learned trial Court could not have been
gone against the plaintiff.

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3.5 It is further submitted that even otherwise when while exercising the discretion in
favour of the plaintiff to pass a decree for specific performance, the learned trial Court
enhanced the amount of sale consideration and directed the plaintiff to pay some more
amount than the sale consideration mentioned in the agreement to sell, the same was not
required to be interfered with by the High Court.
3.6 It is submitted that as such the High Court has straightway gone and considered
Section 20 of the Specific Relief Act, without adverting to the findings recorded by the
learned trial Court on execution of the agreement to sell; payment of part sale
consideration and that the plaintiff was always ready and willing to perform his part of the
contract.
3.7 Making the above submissions, it is prayed to allow the present appeal.
4. The present appeal is opposed by Shri Raghenth Basant, learned counsel
appearing on behalf of the original defendants.
4.1 It is vehemently submitted by the learned counsel appearing on behalf of the original
defendants that as such the agreement to sell was a forced agreement to sell as at the
relevant time, defendant no.1 suffered a heart attack and he was in need of money and
therefore he was compelled to sell the property in question. It is therefore submitted and
as rightly observed by the High Court, the learned trial Court ought not to have exercised
the discretion in favour of the plaintiff, rather ought to have exercised the discretion in
favour of the defendants on the ground of equity.
4.2 Learned counsel appearing on behalf of the original defendants has submitted that
at the time of execution of agreement to sell, the plaintiff paid a meagre amount of Rs.
10,000/- only as advance towards the consideration amount. It is submitted that as the
defendants were hard pressed and were in need of immediate money as defendant no.1
suffered a heart attack, it was agreed that the balance consideration to be paid within six
months from the date of agreement to sell. It is submitted that thereafter as the plaintiff did
not pay the balance sale consideration within six months, the defendants cleared their
liabilities by selling gold ornaments of their family members and therefore thereafter the
defendants were not in need of money and therefore there was no cause and/or reason
to sell the property in question and thereafter the agreement to sell was cancelled. It is
submitted that considering the aforesaid circumstances, the High Court has rightly set
aside the decree for specific performance, considering Section 20 of the Specific Relief
Act and has rightly exercised the discretion in favour of the defendants, rather than in
favour of the plaintiff.
4.3 It is further submitted by the learned counsel appearing on behalf of the defendants
that as on today the price of the property in question has gone very high and therefore it
is prayed not to interfere with the impugned judgment and order passed by the High Court.
5. I have heard the learned counsel for the respective parties at length.
At the outset, it is required to be noted that the execution of agreement to sell and
receipt of part sale consideration paid under the agreement to sell has not been disputed
by the defendants. It is not in dispute that the defendants as such agreed to sell the
property in question. The relevant terms of agreement to sell, as agreed between the
parties, are as follows:
“(a) the balance consideration was to be paid by the Petitioner to the Respondents within six
months from the date of sale agreement.

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(b) The Petitioner was obligated to measure the property at his own expense, arrange the
balance consideration amount and prepare the deeds with respect to the plaint schedule property
in favour of himself or in favour of its nominees.
(c) Respondents were to handover the abovementioned deeds as also the anterior
documents, possession certification, tax receipt and encumbrance certificate for the last 13 years,
purchase certificate, either in their originals or certified copies within the stipulated six months to
the Petitioner.
(d) After the fulfilment of the above terms and conditions, the Respondent No.1 and his wife
were obligated to execute the sale deed prepared by the Petitioner and register the same after
obtaining the balance consideration amount and then accordingly, the Respondents were to hand
over actual possession of the plaint schedule property to the Petitioner.”
6. It is contended on behalf of the defendants that the agreement to sell was a forced
agreement to sell. On the contrary, the defendants stated in the written statement in para
4 that the defendants were always ready and willing to perform their part of the contract.
It may be true that at the relevant time the defendants may be in need of money. However,
the fact remains that they agreed to sell the property in question for sale consideration
mentioned in the agreement to sell and as observed hereinabove, it was the case on
behalf of the defendants that they were always ready and willing to perform their part of
the contract. Therefore, as observed hereinabove, it was never the case on behalf of the
defendants in the written statement and/or even before the learned trial Court that the
agreement to sell was inequitable and/or was a forced agreement to sell. Even the learned
trial Court also did not frame the issue, “whether agreement to sell was a forced agreement
to sell/contract or not”. On appreciation of entire evidence on record, the learned trial Court
after recording the findings on the execution of the agreement to sell by the defendants
and receipt of part sale consideration and that the plaintiff was always ready and willing to
perform his part of the contract, decreed the suit for specific performance. By the
impugned judgment and order, the High Court, as such, has not commented upon and/or
set aside any of the findings recorded by the learned trial Court, recorded while passing a
decree for specific performance. Straightway, the High Court has considered Section 20
of the Specific Relief Act and has observed and held that by enhancing the amount of sale
consideration, the learned trial Court has wrongly exercised the discretion in favour of the
plaintiff. The High Court has commented upon the order passed by the learned trial Court
enhancing the amount of sale consideration and directing the plaintiff to pay more amount
than the sale consideration mentioned in the agreement to sell.
7. When to do the complete justice and relying upon and/or considering the decision
of this Court in the case of Pratap Lakshman Muchandi v. Shamlal Uddavadas
Wadhwa, (2008) 12 SCC 67, the learned trial Court directed the plaintiff to pay some more
amount than the amount mentioned in the agreement to sell, at the most, the plaintiff can
be said to be aggrieved. Still, the High Court has considered such an order passed by the
learned trial Court against the defendants. As such, the learned trial Court was absolutely
justified in compensating the defendants by paying some more amount while passing a
decree for specific performance. Therefore, in the facts and circumstances of the case
and more particularly when the learned trial Court exercised the discretion in favour of the
plaintiff after having observed and recorded the findings on the execution of the agreement
to sell by the defendants and that the part sale consideration was paid by the plaintiff
which was accepted by the defendants and thereafter the finding that the plaintiff was
always ready and willing to perform his part of the contract, the learned trial Court was
absolutely justified in passing the decree for specific performance. The High Court has
erred in interfering with the judgment and decree passed by the learned trial Court, without
setting aside the findings recorded by the learned trial Court recorded while passing the

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decree for specific performance. The impugned judgment and order passed by the High
Court is unsustainable, both, on law as well as on facts.
8. In view of the above and for the reasons stated above, the present appeal succeeds.
The impugned judgment and order passed by the High Court is hereby quashed and set
aside and the judgment and decree passed by the learned trial Court for specific
performance of agreement to sell is hereby restored.
However, to do complete justice and in exercise of powers under Article 142 of the
Constitution of India, I direct that over and above the sale consideration mentioned in the
agreement to sell and the amount already deposited by the plaintiff, the plaintiff to pay a
further sum of Rs. 10,00,000/- (Rupees Ten Lakhs only) to the original defendants, to be
paid within a period of six weeks from today. The amount which might have been
deposited by the original defendants, deposited pursuant to the impugned judgment and
order passed by the High Court, i.e., Rs. 3,10,000/- be also returned/paid to the original
defendants.
9. The present appeal is accordingly allowed in the aforesaid terms. However, in the
facts and circumstances of the case, there shall be no order as to costs.
NAGARATHNA J.
I have had the advantage of reading the judgment proposed by His Lordship M.R.
Shah, J. However, I regret to agree with the reasoning as well as the conclusion arrived
at by His Lordship. Hence, my separate judgment.
2. The plaintiff in Original Suit No. 205/2006 has assailed the judgment dated 03rd
November, 2021, passed by the High Court of Kerala at Ernakulam in Regular First Appeal
No. 63 of 2009. By the impugned judgment, the High Court has set-aside the judgment
and decree passed by the Trial Court, i.e., the Court of the Subordinate Judge, Tirur in
O.S. No. 205/2006, by which the suit for specific performance of an agreement of sale of
Kanam and Kuzhikoor rights, filed by the plaintiff, was allowed. Hence, the appeal by the
plaintiff in the suit.
3. For the sake of convenience, the parties herein shall be referred to in terms of their
rank and status before the Trial Court.
4. The case of the plaintiff in a nutshell is stated as under:
4.1 That the defendants who have Kanam and Kuzhikoor rights over the suit property,
measuring 37 cents since 1989, assigned such rights over the same in favour of the
plaintiff for a consideration of Rs. 8750/- per cent. That an agreement of sale in respect of
the Kanam and Kuzhikoor rights over the suit property was entered into between the
defendants-sellers and the plaintiff-buyer on 7th August, 2005 in the presence of
witnesses. An advance sale consideration of Rs. 10,000/- was paid by the plaintiff. The
remaining sale consideration was required as per the agreement to be paid within six
months from the date on which agreement of sale was entered into, following which the
sale deed was to be executed in favour of the plaintiff or his nominees, in respect of the
Kanam and Kuzhikoor rights, which are valuable usufructuary rights and possession of
the suit property was to be handed over to the plaintiff.
4.2 That before the expiry of six months, the defendants were to make available to the
plaintiff documents pertaining to the suit property, such as tax receipts, non-encumbrance
certificate, purchase certificate etc. That the plaintiff contacted the defendants repeatedly
and expressed his willingness to comply with the terms of the agreement of sale dated 7th
August, 2005. However, defendants sought to evade and delay compliance with the said

5
agreement on the ground that anterior documents and certificates relating to the suit
property could not be obtained.
4.3 That though the plaintiff had sent a legal notice dated 02nd November, 2006 calling
upon the defendants to execute the deed assigning Kanam and Kuzhikoor rights after
accepting the balance sale consideration from the plaintiff, the defendants took no positive
steps in this regard.
4.4 That the plaintiff was ready and willing to tender the balance sale consideration and
have the deed of assignment registered in his name within the period stipulated in the
agreement. That the defendants were attempting to evade the agreement of sale in an
attempt to obtain a better price for the Kanam and Kuzhikoor rights over the suit property
as the market value thereof had increased manifold. Therefore, the plaintiff was
constrained to file a suit for specific performance of the agreement of sale of Kanam and
Kuzhikoor rights, dated 7th August, 2005.
4.5 With the aforesaid averments, it was prayed that the defendants be directed to
receive the balance sale consideration from the plaintiff and execute the sale deed in
respect of the Kanam and Kuzhikoor rights over the suit property in his favour. In the
alternative, it was prayed that the defendants may be directed to return the advance
amount of Rs. 10,000/- paid by the plaintiff, together with interest thereon.
5. In response to the plaint, the defendants filed a written statement, the contents of
which are encapsulated as under:-
5.1 That the plaintiff was never ready and willing to perform his obligations under the
agreement dated 7th August, 2005. That the suit for specific performance was filed on 13th
December, 2006, which was nearly one year after the expiry of the deadline fixed in the
agreement, for compliance of the terms thereof.
5.2 That as per the agreement of sale of Kanam and Kuzhikoor rights, the plaintiff-
purchaser was to measure the suit property and accordingly ascertain the sale
consideration payable at the rate of Rs. 8750/- per cent. That no attempt was made by the
plaintiff in this regard. Therefore, it could not be said that the plaintiff was ready and willing
to perform his part of the agreement, more so, when no attempt was made by the plaintiff
to determine even as much as the exact purchase price for the Kanam and Kuzhikoor
rights over the suit property. That the plaintiff had paid only Rs. 10,000/- which is a very
negligible portion of the purchase price. That the defendants were in dire need for finances
in order to bear the expenses for cardiac treatment of defendant no. 1. Therefore, the
defendants had approached the plaintiff repeatedly, with requests to tender the balance
sale consideration. However, the plaintiff did not pay heed to the requests of the
defendants and therefore, the defendants were constrained to raise the requisite funds by
selling their jewellery and ornaments.
5.3 That the defendants agreed to sell their Kanam and Kuzhikoor rights over the suit
property only with a view to urgently raise requisite finances to enable them to bear the
medical expenses for the treatment of defendant no. 1. Therefore, it was additionally
important for the plaintiff to have duly paid the balance consideration within six months
from the date on which agreement of sale of Kanam and Kuzhikoor rights was entered
into. Since the plaintiff failed to do so, it could not be concluded that he was ready and
willing to perform his obligations under the agreement dated 7th August, 2005.
5.4 That the plaintiff was by occupation, a real estate agent and frequently engaged in
the practice of entering into agreements of sale in respect of properties and thereafter
attempting to find buyers for smaller extents or portions of such properties. That since the
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plaintiff could not find prospective buyers, he did not pursue the agreement dated 7th
August, 2005 for over one year and had been attempting to evade the same. However,
since the value of the suit property considerably increased over time, the plaintiff sought
to claim the same at a price significantly below the prevailing market rate by placing
reliance on a stale agreement of sale of Kanam and Kuzhikoor rights.
5.5 With the aforesaid averments, it was prayed before the Trial Court that the suit filed
by the plaintiff for specific performance of the agreement of sale dated 7th August, 2005,
be dismissed.
6. The Court of the Subordinate Judge, Tirur by its judgment and decree dated 18th
August, 2008 allowed the suit filed by the plaintiff and passed a decree of specific
performance of the agreement of sale of Kanam and Kuzhikoor rights dated 7th August,
2005. Sale consideration was enhanced by 25% and it was directed that a sale
consideration of Rs. 11,000/- per cent, instead of Rs.8750/- per cent, be paid by the
plaintiff. It was directed that on payment of the sale consideration, sale deed in respect of
the Kanam and Kuzhikoor rights over the suit property be executed in favour of the plaintiff
within a period of three months from the date on which the decree was passed.
The salient findings of the Trial Court are as under:
i) That specifying the time for performance of an agreement is not sufficient to prove
that time was indeed the essence of the contract. That if time was the essence of the
agreement, either of the parties ought to have initiated due performance of the same within
the specified period. However, since neither of the parties to the agreement of sale had
initiated timely steps in pursuance of the said agreement, it was held that time was not the
essence of the contract.
ii) That the purchase certificate and title deed of the property were not readily available
with the defendants at the time of entering into the agreement of sale of Kanam and
Kuzhikoor rights over the suit property. That this fact raised the probability that non-
performance of the agreement within the stipulated time, was not attributable to the
plaintiff.
iii) That since the transaction in question involved sale of rights over immovable
property, a prudent purchaser would have to satisfy himself as to the genuineness and
validity of the documents of title. Therefore, the first step ought to have been taken by the
defendants, by handing over the relevant documents to the plaintiff, which would have in
turn enabled the plaintiff to measure the property and tender the balance sale
consideration. That the delay in performance of the agreement of sale could be attributed
to the non-availability and non-furnishing of the title deeds of the plaint schedule property.
iv) That the mere fact that the defendants had handed over the photostat copy of the
title deed to the plaintiff, could not lead to the inference that the plaintiff could have
proceeded to measure the property.
v) That although a direction of specific performance would cause some hardship to
the defendants, because they could no longer pursue their intention of constructing a
house on the suit property, that alone would not be a ground to deny specific performance
of a valid agreement.
vi) That since the value of the suit property had increased manifold and had doubled
within a short span of time, specific performance, if allowed by payment of the
consideration agreed upon in the agreement, would confer an undue benefit on the
plaintiff. Therefore, the sale consideration was enhanced by 25% vis-à-vis the
consideration agreed upon in the agreement dated 7th August, 2005.
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7. Being aggrieved, the defendants preferred Regular First Appeal No. 63 of 2009
before the High Court of Kerala at Ernakulam. By the impugned judgment dated 3rd
November, 2021, the first appeal was allowed and the judgment of the Trial Court dated
18th August, 2008 was set aside. The following findings were recorded by the High Court
in the impugned judgment:
i) That the Trial Court could not have re-fixed the sale consideration at Rs. 11,000/-
per cent as against Rs. 8,750/- per cent, which was the price agreed upon by the parties.
That the Court could not have dictated or deviated from the terms and conditions
enumerated in the contract for sale between the parties.
ii) That under Section 20 of the Specific Relief Act, 1963 (prior to the same being
substituted by way of Act No. 18 of 2018) Courts were vested with the discretion to deny
the relief of specific performance. The Court could balance competing interests by
compensating the plaintiff in terms of money so as to bring him back to his original position,
to the extent possible. The compensation so granted was to be understood to be
compensation for not granting specific performance in favour of the plaintiff. The said
provision did not contemplate exercise of discretion to award an amount to the defendant
in excess of the amount agreed upon contract of sale, while still allowing specific
performance.
iii) That in the present suit, the agreement of sale of Kanam and Kuzhikoor rights was
executed on 07th August, 2005 when the defendants were faced with a financial crisis.
What was received by way of advance was merely 4% of the sale consideration of Rs.
3,23,750/-. Therefore, it was not a fit case for grant of the discretionary relief of specific
performance.
iv) Having regard to the fact that the plaintiff had, in compliance with the judgment of
the Trial Court dated 18th August, 2008, deposited the enhanced consideration of Rs.
3,97,000/-, it was directed that an amount of Rs. 3,00,000/- be paid by the defendants to
the plaintiff in addition to the advance sum of Rs. 10,000/- which was paid by the plaintiff
at the time of entering into the agreement of sale dated 07th August, 2005. Such a direction
was issued based on a proposal made to that effect by the counsel appearing on behalf
of the defendants.
Aggrieved by the judgment of the High Court allowing the regular first appeal
preferred by the defendants, the plaintiff has approached this Court.
8. We have heard Sri M.K.S Menon, learned advocate appearing on behalf of the
appellant and Sri Raghenth Basant, learned advocate appearing on behalf of the
respondents, and perused the material on record.
9. Learned counsel for the appellant-plaintiff made the following submissions. At the
outset it was contended that the High Court was not right in allowing the first appeal
preferred by the defendants by applying Section 20 of the Specific Relief Act, 1963
(hereinafter “the Act”). That the present case was not a fit case for exercising discretion to
deny the relief of specific performance.
9.1 It was next contended that the Trial Court rightly noted that the first step ought to
have been taken by the defendants, by handing over the relevant documents to the
plaintiff. That since the purchase certificate and title deed of the property were not readily
available with the defendants at the time of entering into the agreement, it was rightly
presumed by the Trial Court that the delay in performance of the agreement of sale was
attributable to the defendant.

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9.2 It was urged that the High Court committed a serious error in law by applying Section
20 of the Act to deny the relief of specific performance in favour of the appellant-plaintiff.
That the relief could not be denied on the ground of insufficiency of sale consideration in
light of the fact that the market value of the suit property had increased manifold over a
period of time. That denial of the relief of specific performance on such ground was barred
by Explanation 1 to Clause (c) of Section 20 (2) of the Act. That although Section 20
permits denial of the remedy of specific performance where a decree of specific
performance would involve some hardship to the defendant(s), the Explanation to Clause
(c) of Section 20 (2) clarifies that mere insufficiency of consideration would not be deemed
to constitute ‘hardship.’ Therefore, the consideration guiding the decision of the High Court
to deny the relief of specific performance, was extraneous.
9.3 It was next contended that the Court ought to have moulded the relief by having due
regard to the conduct of the plaintiff. That the plaintiff’s conduct was reflective of the fact
that he duly pursued the execution of the agreement of sale of Kanam and Kuzhikoor and
therefore, was entitled to be awarded a decree of specific performance in his favour. That
in the absence of any proof demonstrative of delay, unwillingness, unreadiness on the
part of the plaintiff, the relief of specific performance could not have been denied.
9.4 Learned counsel for the appellant contended that this Court has authoritatively laid
down that in cases where specific performance of a contract is sought in relation to
property, the market value of which has increased since the date on which contract of sale
was entered into, it would be justified to award an additional amount of consideration to
the seller, at the discretion of the Court, vide Pratap Lakshman Muchandi and Ors. vs.
Shamlal Uddavadas Wadhwa and Ors., (2008) 1 SCC 67. Therefore, the Trial Court had
not erred in decreeing the suit for specific performance in favour of the plaintiff, by directing
the plaintiff to pay additional sale consideration to the defendants. That the direction of the
Trial Court to enhance the consideration did not amount to rewriting the terms of the
agreement, but was done with a view to balance the equities. That the direction of the Trial
Court ought to be appreciated in light of the fact that the relief of specific performance is
an equitable remedy. In that context it was further submitted that the plaintiff duly paid the
enhanced sale consideration, which fact also would demonstrate the conduct of the
plaintiff and his willingness to execute the agreement of sale.
9.5 It was submitted that the reason the plaintiff did not tender the sale consideration in
excess of 4% of the total consideration agreed upon was because the defendants had not
made available any documents which would enable the plaintiff to satisfy himself as to the
title of the defendants. Therefore, the High Court had erred in holding that since only 4%
of the sale consideration had been paid, it would not be a fit case to grant the discretionary
remedy of specific performance, without appreciating the facts of the case in its true
perspective.
With the aforesaid averments, it was prayed that the impugned judgment of the High
Court be set-aside and the judgment of the Trial Court, be restored.
10. Respondent – defendants’ counsel per contra advanced the following arguments:
10.1 He supported the impugned judgment of the High Court and contended that the
High Court rightly applied Section 20 of the Act and denied the relief of specific
performance of the agreement dated 7th August, 2005. That the defendants’ daughter and
son-in-law were desirous of building a house on the suit property and therefore, they would
be put through great hardship if the suit for specific performance was decreed in favour of
the plaintiff; more so, given that market price of the suit property had increased manifold
over a period of time and it would not be possible for the defendants to purchase rights
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over land similar to the suit property with the enhanced consideration awarded by the Trial
Court.
10.2 It was further submitted that the High Court rightly appreciated that the defendants
had entered into the agreement when they were faced with a financial crisis and therefore,
it was imperative that the plaintiff paid a significant portion of the consideration, if not the
entire sale consideration, within the period of six months as stipulated in the agreement of
sale of Kanam and Kuzhikoor rights. That it was in the said context that the fact as to
payment of merely 4% of the sale consideration would be relevant to determine the
plaintiff’s readiness and willingness to perform his obligations under the agreement of sale.
That the object of agreement to sell the Kanam and Kuzhikoor rights over the suit property
in the year 2005 was to receive the entire sale consideration within a period of six months,
which would enable the defendants to pay off certain debts which had been taken to
enable the defendants to bear the medical expenses towards cardiac treatment of
defendant no. 1. Since the plaintiff refused to pay the balance consideration within the
time stipulated in the agreement, notwithstanding several requests by the defendants, the
defendants were compelled to sell their jewellery and ornaments to clear the debts.
10.3 That by refusing to pay sale consideration exceeding 4% of the total sale
consideration within six months from the date of the contract, the plaintiff defeated the
purpose of the agreement to sell the Kanam and Kuzhikoor rights. That the plaintiff was
well aware of the fact that the only reason compelling the defendants to sell the Kanam
and Kuzhikoor rights over suit property at a nominal price agreed upon by the parties was
the critical financial condition that the defendants were faced with at the time of entering
into the agreement of sale. That freedom from financial pressure within a short span of
time (six months) was the sole motive guiding the decision of the defendants to part with
the suit property. In that regard, it was contended that time was the essence of the
agreement and having failed to deposit the balance sale consideration within the stipulated
period, the plaintiff could not subsequently seek the remedy of specific performance,
having defeated the purpose of the agreement vis-à-vis the defendants.
10.4 It was submitted that admittedly, the defendants had, immediately after executing
the agreement of sale of Kanam and Kuzhikoor rights , moved the Land Tribunal, Tirur for
obtaining the purchase certificate. However, the issuance of purchase certificate and time
taken for the same was not under the control of the defendants. That the plaintiff was well
aware of the status of the matter at every juncture. It was averred that delay on the part of
the Land Tribunal in granting purchase certificate could neither be attributed to the
defendants, nor could it absolve the plaintiff of his obligations under the agreement of sale
of Kanam and Kuzhikoor rights. That had the plaintiff duly got measured the schedule
property and tendered the balance sale consideration, it could be concluded that he was
ready and willing to comply with the terms of the agreement.
10.5 With the aforesaid averments it was lastly submitted that the High Court,
appreciated the matter in its true perspective and passed the impugned judgment which
appropriately balances equities between the parties and the same does not call for
interference by this Court. Therefore, it was prayed that the instant appeal be dismissed.
11. Having heard the learned counsel for the respective parties, the following points
would arise for consideration which shall be considered together:
i) Whether the plaintiff’s conduct demonstrates readiness and willingness on his part
to carry out his obligations under the agreement of sale of Kanam and Kuzhikoor rights
dated 7th August, 2005?

10
ii) Whether the plaintiff, by not paying consideration above 4% of total sale
consideration within the period stipulated in the agreement, had defeated the purpose of
the agreement to sell Kanam and Kuzhikoor rights executed by the defendants?
iii) What order?
The detailed narration of facts and contentions would not call for reiteration.
12. The High Court has relied on Section 20 of the Act, prior to the same being
substituted by way of Act No. 18 of 2018, to deny the relief of specific performance to the
plaintiff. Section 20 of the Act as it stood prior to the Amendment Act of 2018 provided that
the jurisdiction to decree specific performance is discretionary. It said that the Court is not
bound to grant such relief merely because it is lawful to do so. Such a discretion, however,
was not to be exercised arbitrarily, but ought to have been based on sound and reasonable
judicial principles. The Section also specified the circumstances in which the Court may
properly exercise the discretion not to decree specific performance and it also specified
when, in an appropriate case, a decree could be given by proper exercise of discretion.
Section 20, as it then stood was not an exhaustive provision, but merely illustrative as it
was not possible to define the circumstances in which equitable relief could or could not
be granted. If, therefore, on a consideration of all the circumstances of the case, the Court
thought that it would be inequitable to grant the relief prayed for, it should not do so.
13. However, in Shenbagam vs. K.K. Rathinavel, 2022 SCC OnLine SC 71, this Court
reiterated that in deciding whether or not to grant the relief of specific performance, the
Courts must be cognizant of the conduct of the parties, the escalation in the price of the
suit property and consider whether one party will unfairly benefit from the decree.
14. By way of the Specific Relief (Amendment) Act, 2018 (hereinafter “the Amendment
Act”), Section 20 of the Act has been substituted, thereby rendering the relief of specific
performance to be a statutory remedy, instead of a discretionary remedy. Previously, the
unamended provision granted the courts the discretion to deny the relief of specific
performance, on the basis of judicially developed exceptions, even where it would
otherwise be lawful to direct specific performance. Now, such statutorily created
exceptions have been excluded. The Amendment Act has eliminated the discretion of the
courts in cases involving specific performance of contracts and grants a right to an
aggrieved party to seek specific performance of a contract in certain cases, subject to the
provisions contained in Sections 11(2), 14 and 16 of the Act. These Sections deal with
‘Cases in which specific performance of contracts connected with trusts being
enforceable’, ‘contracts which cannot be specifically enforced’ and ‘personal bars to relief,’
respectively.
15. It is however to be noted that notwithstanding substitution of Section 20 of the Act,
the position of law on all material aspects, such as the essential elements of readiness
and willingness and other aspects under the unamended Section 16 remains the same.
In this regard, the decision of this Court in Mehboob-Ur-Rehman (Dead) through LRs
vs. Ahsanul Ghani – [(2019) 19 SCC 415] may be referred to. In the said case, this Court
held that even following the amendment of the Specific Relief Act, 1963, by way of Act
No. 18 of 2018, the position of law on all material aspects remains the same. It was
observed that, even following the amendment, the law was to the effect that specific
performance of a contract could not be granted or enforced in favour to the person who
fails to prove that he has already performed or has always been ready and willing to
perform the essential terms of the contract which are to be performed by him, other than
the terms of which, the performance has been prevented or waived by the other party.

11
16. Reference may also be had to the decision of this Court in Sughar Singh vs. Hari
Singh (Dead) through LRs and Ors., A.I.R. 2021 SC 5581. In the said case, the question
as to applicability of the unsubstituted provision of Section 20 of the Act on transactions
entered into prior to the date on which the Amendment Act of 2018, was kept open.
However, the Court held that the provisions subsequently substituted, may act as a guide
to Courts in exercising discretion in matters dating prior to the substitution, even though
such provisions may not apply retrospectively. The relevant observations of this Court
have been extracted as under:
“10. Now, so far as the finding recorded by the High Court and the observations made by the High
court on Section 20 of the Act and the observation that even if the agreement is found to be duly
executed and the plaintiff is found to be ready and willing to perform his part of the Agreement,
grant of decree of specific performance is not automatic and it is a discretionary relief is
concerned, the same cannot be accepted and/or approved. In such a case, many a times it would
be giving a premium to the dishonest conduct on the part of the defendant/executant of the
agreement to sell. Even the discretion under Section 20 of the Act is required to be exercised
judiciously, soundly and reasonably. The plaintiff cannot be punished by refusing the relief of
specific performance despite the fact that the execution of the agreement to sell in his favour has
been established and proved and that he is found to be always ready and willing to perform his
part of the contract. Not to grant the decree of specific performance despite the execution of the
agreement to sell is proved; part sale consideration is proved and the plaintiff is always ready and
willing to perform his part of the contract would encourage the dishonesty. In such a situation, the
balance should tilt in favour of the plaintiff rather than in favour of the defendant – executant of
the agreement to sell, while exercising the discretion judiciously.
For the aforesaid, even amendment to the Specific Relief Act, 1963 by which section 10(a) has
been inserted, though may not be applicable retrospectively but can be a guide on the
discretionary relief. Now the legislature has also thought it to insert Section 10(a) and now the
specific performance is no longer a discretionary relief. As such the question whether the said
provision would be applicable retrospectively or not and/or should be made applicable to all
pending proceedings including appeals is kept open. However, at the same time, as observed
hereinabove, the same can be a guide.”
(emphasis by me)
17. In B. Santoshamma vs. D. Sarala and Anr., (2020) 19 SCC 80 this Court, while
examining the amendment made to Section 10 of the Act observed that after the
amendment to Section 10, the words "specific performance of any contract may, in the
discretion of the Court, be enforced" have been substituted with the words "specific
performance of a contract shall be enforced subject to the provisions contained in sub-
section (2) of Section 11, Section 14 and Section 16". It was concluded that although the
relief of specific performance of a contract is no longer discretionary, after the amendment,
the same would still be subject to Section 11, Section 14 and Section 16 of the Act.
18. Applying the law discussed above to the facts of the present dispute, I am of the
view that even in the absence of discretionary power under Section 20 to deny the relief
of specific performance, the plaintiff was not entitled to claim such relief as a matter of
right. The position of law, even following the amendment of 2018 remains that the
provisions of Section 16 of the Act have to be mandatorily complied with by the party
seeking the relief of specific performance. The relief of specific performance cannot be
granted in favour of a party who has not performed his obligations under the contract. It is
therefore necessary to ascertain whether, the plaintiff had complied with the statutory
prerequisites under Section 16 (c) of the Act, before claiming the relief of specific
performance. Section 16 of the Act on being amended w.e.f. 01st October, 2018, reads as
under:

12
“16. Personal bars to relief.—Specific performance of a contract cannot be enforced in favour
of a person—
(a) who has obtained substituted performance of contract under section 20; or
(b) who has become incapable of performing, or violates any essential term of, the contract
that on his part remains to be performed, or acts in fraud of the contract, or wilfully acts at variance
with, or in subversion of, the relation intended to be established by the contract; or
(c) who fails to prove that he has performed or has always been ready and willing to perform
the essential terms of the contract which are to be performed by him, other than terms of the
performance of which has been prevented or waived by the defendant.
Explanation.—For the purposes of clause (c), —
(i) where a contract involves the payment of money, it is not essential for the plaintiff to
actually tender to the defendant or to deposit in court any money except when so directed by the
court;
(ii) the plaintiff must prove performance of, or readiness and willingness to perform, the
contract according to its true construction.”
19. Clause (c) of Section 16 of the Act, which is relevant in the instant case, though
amended w.e.f. 01st October, 2018 clearly states that unless the plaintiff establishes his
readiness and willingness to perform his part of the contract, he would not be entitled to a
decree of specific performance. Prior to the amendment, the expression “who fails to aver
and prove” was on the statute book and its substitution by the words “who fails to prove”
does not bring about any drastic change to the object and intent of the clause. This is
because failing to prove readiness and willingness to perform the essential terms of the
contract would first require averments to that effect to be made in the plaint by the plaintiff.
The absence of such averments regarding readiness and willingness to perform the
essential terms of the contract by the plaintiff would not permit him to let in any evidence
on that aspect. It is a settled principle of law that no evidence can be permitted to be let in
in the absence of averments in the plaint / pleadings vide Bachhaj Nahar vs. Nilima
Mandal and Ors., (2008) 17 SCC 491. In the said case, a Bench of this this Court
speaking through Raveendran J. laid down as follows:
(i) No amount of evidence can be looked into, upon a plea which was never put forward
in the pleadings. A question which did not arise from the pleadings and which was not the
subject matter of an issue, cannot be decided by the Court.
(ii) A Court cannot make out a case not pleaded. The Court should confine its decision
to the question raised in pleadings. Nor can it grant a relief which is not claimed and which
does not flow from the facts and the cause of action alleged in the plaint.
20. Therefore, notwithstanding the amendment to Section 16 of the Act whereby the
expression “who fails to aver and prove” has been substituted with the phrase “who fails
to prove,” the law remains that no evidence can be let in on a plea that was never put
forward in the plaint/pleadings. But, it is necessary to sound a caveat. Even the absence
of the words “ready and willing to perform the contract” in the plaint would now not have
an adverse impact on the plaintiff’s case, so long as plaintiff’s readiness and willingness
to perform the essential terms of the contract could be gathered on a holistic reading of
the plaint.
21. In fact, even in relation to the earlier scheme of Section 16 of the Act which required
a plaintiff seeking the remedy of specific performance to ‘aver and prove’ that he was
ready and willing to perform his obligations under an agreement, this Court had observed
that it was sufficient if the averments in substance indicate continuous readiness and
willingness on the part of the person suing, to perform his part of the contract vide Motilal
Jain vs. Ramdasi Devi, A.I.R. 2000 SC 2408. Further, it had been declared that language
in Section 16 (c), as it stood prior to the Amendment Act of 2018, did not require any
13
specific phraseology to be followed in relation to the averments as to readiness and
willingness. That the compliance of requirements of readiness and willingness have to be
in spirt and substance and not in letter and form vide Syed Dastagir vs. T.R.
Gopalakrishna Shetty, (1999) 6 SCC 337.
That is why the deletion of the words “who fails to aver” in Section 16 (c) of the Act
does bring about any real change in the position of law as it stood prior to the amendment.
22. Further, readiness and willingness cannot be considered in a straitjacket formula; it
has to be inferred on a consideration of the entire facts and circumstances of each case
and the intention and conduct of the parties concerned. Even if a party to the contract is
ready and has the requisite funds he may not be willing to perform his part of the contract
and vice versa.
23. In this regard, reference may be made to the decision of this Court in His Holiness
Acharya Swami Ganesh Dassji vs. Sita Ram Thapar, (1996) 4 SCC 526 wherein this
Court made a distinction between ‘readiness’ and ‘willingness’ and the manner in which
the said parameters are to be scrutinised in deciding a suit for specific performance. The
relevant findings of this Court are extracted as under:
“2. There is a distinction between readiness to perform the contract and willingness to perform
the contract. By readiness may be meant the capacity of the plaintiff to perform the contract which
includes his financial position to pay the purchase price. For determining his willingness to perform
his part of the contract, the conduct has to be properly scrutinised.
[xxx]
The factum of readiness and willingness to perform plaintiffs part of the contract is to be adjudged
with reference to the conduct of the party and the attending circumstances. The court may infer
from the facts and circumstances whether the plaintiff was ready and was always ready and willing
to perform his part of the contract. The facts of this case would amply demonstrate that the
petitioner/plaintiff was not ready nor capacity to perform his part of the contract as he had no
financial capacity to pay the consideration in cash as contracted and intended to bite for the time
which disentitles him as time is the essence of the contract.”
Thus, both readiness as well as willingness have to be established by the plaintiff
on whom the burden is cast in a suit for specific performance of an agreement. Therefore,
the question would arise as to whether the plaintiff discharged such burden in the instant
case.
24. Further, in J.P. Builders vs. A. Ramdas Rao, (2011) 1 SCC 429, this Court held
as under, as regards the onus on a plaintiff claiming the relief of specific performance, to
prove that he had complied with Section 16 (c) of the Act and had demonstrated
‘readiness’ and ‘willingness’ to carry out his obligations under the agreement of sale:
“25. Section 16(c) of the Specific Relief Act, 1963 mandates "readiness and willingness" on the
part of the plaintiff and it is a condition precedent for obtaining relief of grant of specific
performance. It is also clear that in a suit for specific performance, the plaintiff must allege and
prove a continuous "readiness and willingness" to perform the contract on his part from the date
of the contract. The onus is on the plaintiff.
[xxx]
27. It is settled law that even in the absence of specific plea by the opposite party, it is the mandate
of the statute that plaintiff has to comply with Section 16(c) of the Specific Relief Act and when
there is non-compliance with this statutory mandate, the Court is not bound to grant specific
performance and is left with no other alternative but to dismiss the suit. It is also clear that
readiness to perform must be established throughout the relevant points of time. "Readiness and

14
willingness" to perform the part of the contract has to be determined/ascertained from the conduct
of the parties.”
25. As per the agreement of sale of Kanam and Kuzhikoor rights, dated 07th August,
2005, the plaintiff was obligated to carry out the following terms:
(a) The plaintiff was obligated to measure the property at his own expense;
(b) Prepare the deeds with respect to the plaint schedule property in favour of himself
or in favour of his nominees;
(c) The balance consideration was to be paid by the plaintiff to the defendants within
six months from the date of agreement.
The agreement also stipulated that the defendants were to:
(a) Handover the abovementioned deeds as also the anterior documents, possession
certification, tax receipt and encumbrance certificate for the last thirteen years, purchase
certificate, either in their originals or certified copies to the plaintiff;
(b) On receipt of the balance sale consideration execute the sale deed in favour of the
plaintiff within six months.
The relevant terms of the agreement are reproduced hereinunder:
“The 1st Parties have decided to assign the above property belonged and possessed by them to
2nd Party by fixing an amount of Rs.8750/- (Eight Thousand Seven Hundred and Fifty Only) for
their rights of Kanam and Kuzhikkoor rights over the property and the 2nd Party has agreed for
the same and accordingly the 1st Parties have received an amount of Rs. 10,000/- (Ten Thousand
Only) from the 2nd Party towards advance for the consideration amount. It has been decided that
the 2nd Party shall measure the property on his expense, arrange the balance consideration
amount and prepare the deeds pertaining to the above property in favour of 2nd party or in favour
of the nominees of 2nd Party within 6 (six) months from today and the 1st Parties shall sign the
deed prepared by the 2nd Party and register the same after obtaining the balance consideration
amount from 2nd Party and hand over actual possession of the property to 2nd party. It is further
decided that the 1st party shall hand over the above mentioned deeds and anterior documents,
possession certificate, tax receipt, encumbrance certificate for the last 13 years, purchase
certificate, either in original or certified copies, within the above said period to 2nd Party.”
26. Nothing was brought on record by the plaintiff to demonstrate that positive steps
were taken by him in pursuance of the agreement of sale of Kanam and Kuzhikoor rights.
It is trite that the relief of specific performance cannot be granted in favour of a party who
has not performed his obligations under the contract. The only exception to such rule is
that a party is not required to perform those obligations, as are prevented or waived by
the other party to the contract.
27. In the present case, it is an admitted fact that the plaintiff had paid an amount, which
constituted merely 4% of the consideration. The Trial Court itself recorded findings to the
effect that neither party had initiated timely steps to perform their respective obligations
under the contract. Although the defendants did not make available the title deeds of the
schedule property to the plaintiff, it could not be said that the conduct of the defendants
had prevented the plaintiff from tendering the balance sale consideration, within the
stipulated date, or at any time before filing the suit for specific performance as the whole
object of the intended sale was to garner funds for discharging a debt which was ultimately
done by the defendants by selling family jewellery.
28. That paragraph 11 of the Trial Court’s judgment records a finding to the effect that
the defendants had applied for the purchase certificate in the year 2005 itself, i.e., soon
after entering into the agreement of sale of Kanam and Kuzhikoor rights. The same was
obtained on 31st May, 2007. This fact would suggest that there was no delay on the part
of the defendant in acting in pursuance of the agreement. The fact that the purchase
15
certificate was granted by the concerned authority only on 31st May, 2007, was beyond
the control of the defendants and such delay could not be attributed to the defendants.
The defendants had duly initiated the process of obtaining a purchase certificate soon
after entering into the agreement.
29. While learned counsel for the appellant-plaintiff has contended that since the
transaction in question involved the transfer of rights in immovable property, a prudent
purchaser would have to satisfy himself as to the genuineness and validity of the
documents of title, and therefore, owing to the nonavailability of documents of title, the
plaintiff was unable to proceed with his obligations, no explanation has been provided as
to why ancillary steps such as measurement of the property was not proceeded with.
Delay in securing relevant documents from the concerned authorities could not absolve
the plaintiff of his obligations under the agreement of sale of Kanam and Kuzhikoor rights.
Further, this aspect of the matter is to be appreciated in light of the fact that there is nothing
on record which would demonstrate any step taken by the plaintiff to pursue the
agreement, until, 02nd November, 2006, on which date, the legal notice was served on the
defendants calling upon them to execute the sale deed in respect of the Kanam and
Kuzhikoor rights over the suit property. No explanation has been provided as to why the
legal notice was not served earlier, particularly when the six-month period stipulated under
the agreement had expired on 7th February, 2006. Such conduct of the plaintiff is certainly
not reflective of willingness, in terms of Section 16(c) of the Act.
30. Further, the Court has to be mindful of circumstances which compelled the
defendants to enter into the agreement of sale of Kanam and Kuzhikoor rights dated 7th
February, 2006. The time limit stipulated in the agreement is of significance in the instant
case when this aspect is viewed in light of the fact that the defendants were debt-ridden
and sought to sell their Kanam and Kuzhikoor rights over suit property with the sole
intention of clearing off such debts which were incurred to support the cardiac treatment
of defendant no. 1. It was therefore necessary that the plaintiff paid a significant portion of
the consideration, if not the entire sale consideration, within the period of six months as
stipulated in the agreement. But the plaintiff refused to do so even on being repeatedly
requested by the defendants.
31. At this juncture, it may also be apposite to refer to the decision of this Court in
Saradamani Kandappan vs. S. Rajalakshmi, (2011) 12 SCC 18 wherein this Court had
an occasion to consider the aspect of payment of a nominal advance by the plaintiff and
effect of the amount of advance paid on the decision of the Court to grant the discretionary
relief of specific performance. This Court has authoritatively laid down that it would amount
to injustice to hold that a vendor who took a very meagre sum as earnest money, and
agreed that the rest of the consideration would be paid within a stipulated period of time,
did not intend that time was of essence to the contract. The relevant portion of the said
judgment is usefully extracted as under:
“37. The reality arising from this economic change cannot continue to be ignored in deciding cases
relating to specific performance. The steep increase in prices is a circumstance which makes it
inequitable to grant the relief of specific performance where the purchaser does not take steps to
complete the sale within the agreed period, and the vendor has not been responsible for any
delay or non-performance. A purchaser can no longer take shelter under the principle that time is
not of essence in performance of contracts relating to immovable property, to cover his delays,
laches, breaches and "non-readiness". The precedents from an era, when high inflation was
unknown, holding that time is not of the essence of the contract in regard to immovable properties,
may no longer apply, not because the principle laid down therein is unsound or erroneous, but
the circumstances that existed when the said principle was evolved, no longer exist. In these days

16
of galloping increases in prices of immovable properties, to hold that a vendor who took an earnest
money of say about 10% of the sale price and agreed for three months or four months as the
period for performance, did not intend that time should be the essence, will be a cruel joke on
him, and will result in injustice. Adding to the misery is the delay in disposal of cases relating to
specific performance, as suits and appeals therefrom routinely take two to three decades to attain
finality. As a result, an owner agreeing to sell a property for rupees one lakh and received rupees
ten thousand as advance may be required to execute a sale deed a quarter century later by
receiving the remaining rupees ninety thousand, when the property value has risen to a crore of
rupees.”
(emphasis by me)
32. Further, regarding the factors that ought to guide the Court’s decision in decreeing
a suit for specific performance, particularly when the agreement of sale has not been given
effect to within the time stipulated therein, the following directions issued in an earlier
decision in K.S. Vidyanadam vs. Vairavan (1997) 3 SCC 1, were reiterated:
(i) The courts, while exercising discretion in suits for specific performance, should bear in
mind that when the parties prescribe a time/period, for taking certain steps or for completion of
the transaction, that must have some significance and therefore time/period prescribed cannot be
ignored.
(ii) The courts will apply greater scrutiny and strictness when considering whether the
purchaser was "ready and willing" to perform his part of the contract.
(iii) Every suit for specific performance need not be decreed merely because it is filed within
the period of limitation by ignoring the timelimits stipulated in the agreement. The courts will also
"frown" upon suits which are not filed immediately after the breach/refusal. The fact that limitation
is three years does not mean that a purchaser can wait for 1 or 2 years to file a suit and obtain
specific performance. The three-year period is intended to assist the purchasers in special cases,
as for example, where the major part of the consideration has been paid to the vendor and
possession has been delivered in part- performance, where equity shifts in favour of the
purchaser.
(emphasis by me)
In light of the said directions, the period of six months which was stipulated in the
agreement of sale of Kanam and Kuzhikoor rights, in the present case, has to be accorded
its due significance while deciding the suit for specific performance. Having regard to the
urgency of the financial need of the defendants, which need had prompted them to sell
their Kanam and Kuzhikoor rights over the suit property, it must be held that time stipulated
in the agreement was the essence of the contract.
33. Further, the direction of this Court in the aforecited case regarding the onus on the
party claiming specific performance to initiate action immediately after the breach or
refusal by the other party to the contract, is also relevant to the facts of the present case.
The plaintiff in the present case served a legal notice only on 02nd November, 2006 while
the six month period stipulated in the agreement had elapsed on 07th February, 2006.
There is no explanation as to what occasioned the delay in serving the legal notice on the
defendants and why such steps were not adopted soon after the expiry of the six month
period stipulated in the agreement of sale of Kanam and Kuzhikoor rights.
34. Therefore, it is held that the plaintiff, having paid no more than 4% of the sale
consideration, and having not done even as much as getting the property measured within
the period of six months stipulated under the agreement, cannot, at a belated date, claim
specific performance of the agreement dated 7th August, 2005 to the disadvantage and
hardship of the defendants.

17
35. Learned counsel for the plaintiff has sought to rely on the decision of this Court in
Pratap Lakshman Muchandi and Ors. vs. Shamlal Uddavadas Wadhwa and Ors.,
(2008) 1 SCC 67 wherein it was held that in cases where specific performance of a
contract is sought in relation to property, the market value of which has increased since
the date on which contract of sale of Kanam and Kuzhikoor rights was entered into, it
would be justified to award an additional amount of consideration to the seller, at the
discretion of the Court. While I am mindful of the fact that Courts may grant such a relief
to balance equities, such a decree would be warranted only in cases where the plaintiff
satisfactorily establishes compliance with Section 16 of the Act. That the measure of
enhancement of compensation may be awarded at the discretion of the Court only if
insufficiency of compensation is the only impediment to ensuring equity and preventing
undue gain to one party. In the absence of compliance with the elementary requirements
of Section 16 of the Act, enhancement of compensation cannot be employed as a device
to allow specific performance in cases where the plaintiff has not performed his obligations
under the contract as in the instant case.
36. In my view, this appeal must fail on the sole ground that the conduct of the plaintiff
was not reflective of his readiness as well as willingness on his part to pursue the
agreement of sale of Kanam and Kuzhikoor rights, in terms of Section 16(c) of the Act.
Accordingly, the present appeal is dismissed.
37. At this juncture, it is clarified that the result of this appeal has been arrived at having
regard to the conduct of the plaintiff, which does not reflect his willingness to comply with
the terms of the agreement of sale dated 7th August, 2005. The suit for specific
performance of the agreement of sale of Kanam and Kuzhikoor rights would fail on the
sole ground that the plaintiff has failed to comply with the essential requirements of Section
16(c) of the Act. Although it is acknowledged that the defendants would be put through
hardship if the suit for specific performance was decreed in favour of the plaintiff, the
appeal has been decided dehors considerations of hardship to the defendants, or of other
circumstances under which the contract was entered into which could give the plaintiff an
unfair advantage over the defendants, which are considerations in equity as the relief of
specific performance is essentially an equitable remedy though crystalised in the form of
a legislation as per the Act. Thus, the appeal has not been decided in light of Section 20
of the Act, as it stood prior to the Amendment Act of 2018. The question as to applicability
of the provision of Section 20 of the Act as it stood prior to its amendment in 2018, on
transactions entered into prior to the date on which the Amendment Act of 2018, is thus
kept open.
38. The impugned judgment of the High Court of Kerala dated 03rd November, 2021
whereby the High Court set-aside the judgment and decree passed by the Trial Court, i.e.,
the Court of the Subordinate Judge, Tirur in O.S. No. 205/2006 (by which the suit for
specific performance of an agreement of sale of Kanam and Kuzhikoor rights, filed by the
plaintiff was decreed), is affirmed. This appeal is dismissed.
Parties are directed to bear their respective costs.

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