25 Important Decisions On Specific Performance Of Contract

Case 1: Plaintiff Seeking Temporary Injunction in Specific Performance Suit Has To Show Strong Prima Facie Case on Undisputed Facts: CASE DETAILS: TITLE: Ambalal Sarabhai Enterprise Ltd vs KS Infraspace LLP and another & Haryana Containers Ltd vs KS Infraspace LLP and another (Civil Appeals No 9346, 9347, 9348-49 of 2019). FACTS: The Court was hearing an appeal filed by defendants in a specific performance suit against the interim order passed by the trial court (and affirmed by High Court) restraining them from executing sale deed or any other documents creating charge with respect to the property. The defendants contended that there was no concluded contract for sale, and that the agreement was only in the negotiation stage. When the talks fell out, the advance amount was also refunded to the plaintiff, submitted the defendants. JUDGEMENT: The Supreme Court held that- "Chapter VII, Section 36 of the Specific Relief Act, 1963 (hereinafter referred to as 'the Act') provides for grant of preventive relief. Section 37 provides that temporary injunction in a suit shall be regulated by the Code of Civil Procedure. The grant of relief in a suit for specific performance is itself a discretionary remedy. A plaintiff seeking temporary injunction in a suit for specific performance will therefore have to establish a strong primafacie case on basis of undisputed facts. The conduct of the plaintiff will also be a very relevant consideration for purposes of injunction. The discretion at this stage has to be exercised judiciously and not arbitrarily"- Ashok Bhushan & Navin Sinha. JJ Case 2: Conduct Of A Plaintiff Is Very Crucial In A Suit For Specific Performance: CASE DETAILS: TITLE: Atma Ram vs. Charanjit Singh (SLP (C) No.27598 of 2016) FACTS: The plaintiff in this case was a party to agreement for sale dated 12.10.1994. The date for performance of the contract was fixed under the agreement as 07.10.1996. After more than three years, the plaintiff filed a suit only for the relief of mandatory injunction, which he valued only at Rs.250 and paid a fixed court fee of Rs.25. On an application filed by defendant challenging the maintainability of the suit, the Trial Court held that the suit was in fact one for specific performance of an agreement of sale and that the technical objection regarding the maintainability could be overcome by directing the petitioner/plaintiff to pay the requisite court fee. Thereafter plaintiff paid the deficit court fee and the trial court chose to treat the suit as one for specific performance, which was ultimately decreed by it. This decree was later set aside by the First Appellate Court. The High Court, upholding the First Appellate Court judgment held the suit as time barred. JUDGEMENT: "A shortcut was found by the petitioner/plaintiff to retain the plaint as such, but to seek permission to pay deficit court fee, as though what was filed in the first instance was actually a suit for specific performance. Such a dubious approach should not be allowed especially in a suit for specific performance, as the relief of specific performance is discretionary under Section 20 of the Specific Relief Act, 1963". "The conduct of a plaintiff is very crucial in a suit for specific performance. A person who issues a legal notice on 12.11.1996 claiming readiness and willingness, but who institutes a suit only on 13.10.1999 and that too only with a prayer for a mandatory injunction carrying a fixed court fee relatable only to the said relief, will not be entitled to the discretionary relief of specific performance. "- Justice NV Ramana and Justice V. Ramasubramanian. CASE 3: Delay To File Suit for Specific Performance Not A Ground To Deny Relief If It Was Filed Within Limitation Period CASE DETAILS: TITLE: R Lakshmikantham vs. Devaraji (CA No 2420 of 2018). FACTS: In this case, the date of the agreement i.e. 22.09.2002 and suit was filed on 11.02.2005. There the Madras high court dismissed the suit observing that "it has not been explained by the plaintiff as to why she should wait till 11.02.2005 to lay the suit for specific performance, after coming to know that the defendant had not responded to the notice sent by her. This would only go to show that in as much as the plaintiff had not been ready and willing to perform her part of the contract". JUDGEMENT: "The High Court was incorrect in putting a short delay in filing the Suit against the plaintiff to state that he was not ready and willing. In India, it is well settled that the rule of equity that exists in England, does not apply, and so long as a Suit for specific performance is filed within the period of limitation, delay cannot be put...

25 Important Decisions On Specific Performance Of Contract

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