Specific Performance Relief Mandatory After 2018 Amendment, Court Bound To Enforce Registered Agreement To Sell: Allahabad High Court

The Allahabad High Court has held that after the amendment to the Specific Relief Act, 1963 with effect from October 1, 2018, the grant of specific performance of a contract is no longer discretionary and courts are bound to enforce it, subject to Sections 11(2), 14 and 16 of the Act. Holding that the amended provisions govern agreements executed after that date, the Court upheld a decree directing specific performance of a registered agreement to sell.The amended Section 10 replaces the earlier language, under which specific performance “may, in the discretion of the court, be enforced”, with a direction that it “shall be enforced” subject to Sections 11(2), 14 and 16.Section 11(2) deals with contracts entered into by trustees, Section 14 specifies the categories of contracts that cannot be specifically enforced, while Section 16 enumerates the personal bars to relief, including the requirement that the plaintiff establish readiness and willingness to perform the contract.Relying on the Supreme Court's decision in B. Santoshamma v. D. Sarala, Justice Sandeep Jain held,“the Court is bound to specifically enforce the registered agreement to sell dated 30.12.2019 subject to the provisions of Section 11(2),14 and 16 of the Specific Relief Act.”The plaintiff-respondent, Ganesh Prasad, entered into a registered agreement to sell dated December 30, 2019, by which the defendant-appellant, Tushar Agrawal, agreed to sell his two-storey house at Bhadohi for ₹30 lakh. Of this, ₹20 lakh was paid as earnest money by cheque, and the balance ₹10 lakh was to be paid at the time of execution of the sale deed, which was to be executed within three years. When the defendant did not execute the sale deed despite notice, the plaintiff filed a suit for specific performance of the agreement.The defendant denied executing the agreement. He contended that the ₹20 lakh was payment towards the silver business the two carried on, and that the plaintiff had fraudulently obtained his signatures on blank papers by exploiting that business relationship. He also pleaded that the house was his only residence, in which his shop was situated, and was worth over ₹2 crore, and that he therefore had no reason to sell it for ₹30 lakh.The Court of the Civil Judge (Senior Division), Bhadohi, decreed the suit on March 11, 2025. The defendant then filed an appeal before the High Court.The High Court rejected the plea of fraud, noting that the defendant, who had earlier handled the registration of sale deeds for himself and his wife, could not explain how the fraud had been practised. The Court noted that he had neither lodged any police complaint nor filed any suit seeking cancellation of the agreement, and had continued doing business with the plaintiff thereafter. It held that the plaintiff had established that the ₹20 lakh constituted earnest money under the agreement and was not connected with their business dealings.The Court further held that the plaintiff's readiness, willingness and financial capacity to pay the balance consideration were evident from the fact that he had maintained a balance exceeding ₹10 lakh in his account, had served notice on the defendant and had made good the deficiency in court fees. Rejecting the appellant's contention that the plaintiff was required to plead readiness and willingness strictly in the format prescribed by Forms 47 and 48 of Appendix A to the CPC, the Court observed:“The above compliance of 'readiness and willingness' has to be in spirit and substance and not in letter and form.”Relying on P. Daivasigamani v. S. Sambandan, the Court held that the 2018 amendment operates prospectively. Since the disputed agreement had been executed on December 30, 2019, after the amendment came into force, the amended provisions would apply.The Court held,“The Apex Court in the case of B.Santoshamma (supra) has also held that after the amendment with effect from 1.10.2018, the relief of specific performance of contract is no longer discretionary. The Court is, now obliged to enforce the specific performance of a contract, subject to the provisions of Section 11(2), 14 and 16 of the Specific Relief Act.”The Court further held that any hardship arising from the decree was attributable to the conduct of the defendant-appellant and not to the plaintiff-respondent.Accordingly, the Court dismissed the appeal with costs and affirmed the judgment and decree of the trial court. It directed the defendant to execute the sale deed within two months of receiving the balance ₹10 lakh, failing which the plaintiff would be entitled to have the sale deed executed through the court upon depositing the balance amount.Case Title: Tushar Agrawal v. Ganesh Prasad 2026 LiveLaw (AB) 383Case Citation : 2026 LiveLaw (AB) 383Click Here To Read/Download Order

Specific Performance Relief Mandatory After 2018 Amendment, Court Bound To Enforce Registered Agreement To Sell: Allahabad High Court

Upasna Agrawal

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Specific Performance Relief Mandatory After 2018 Amendment, Court Bound To Enforce Registered Agreement To Sell: Allahabad High Court

Upasna Agrawal

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