Tag: Specific Performance

Specific Performance Upheld: Supreme Court Reinstates Decree in Property Dispute
15Jan By The Legal ChamberNo Comments
Supreme Court

Specific Performance Upheld: Supreme Court Reinstates Decree in Property Dispute

The Supreme Court held that the High Court exceeded its jurisdiction under Section 100 CPC by interfering with the first appellate court's findings of fact, particularly regarding additional payment and the plaintiff's readiness and willingness. The Court reiterated that time is not ordinarily the essence in immovable property contracts and that acceptance of further payment post-deadline constitutes a waiver of the right to forfeit earnest money, making the suit for specific performance maintainable without a separate declaratory relief. Facts Of The Case: The appellant, Annamalai, entered into a registered sale agreement dated 08.01.2010 with Saraswathi (D-1) and Dharmalingam (D-2) for two property items. The total consideration was Rs. 4,80,000, of which Rs. 4,70,000 was paid as a...
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Supreme Court Denies Specific Performance for Deal Breaching Construction Laws
27Dec By The Legal ChamberNo Comments
Supreme Court

Supreme Court Denies Specific Performance for Deal Breaching Construction Laws

The Supreme Court held that an agreement mandating construction violating building laws is void and unenforceable. The illegality rendered specific performance impossible under Section 12 of the Specific Relief Act, as the unlawful object was essential to the contract. The Court affirmed that contracts contravening statutory provisions cannot be severed to remove their core illegal purpose. Facts Of The Case: The appellant, Canara Bank, entered into an agreement with the respondent, K.L. Rajgarhia, on 27.12.1984 for the purchase of residential flats to be constructed on a plot in East of Kailash, Delhi. The total consideration was ₹32,07,500, of which approximately 90% (₹28,86,750) was paid upfront. The agreement stipulated the construction and delivery of eight flats and a basement with...
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When a Contract Becomes Void: Supreme Court Explains the Limits of Specific Performance
25Dec By The Legal ChamberNo Comments
Supreme Court

When a Contract Becomes Void: Supreme Court Explains the Limits of Specific Performance

The Supreme Court held that an agreement to sell flats, which was contingent upon construction violating building bye-laws and the master plan, was unlawful and void under Section 23 of the Indian Contract Act. The Court ruled that specific performance cannot be granted for an illegal contract, and courts cannot rewrite or sever its essential, unlawful terms to make it enforceable. Facts Of The Case: In December 1984, Canara Bank entered into an agreement with K.L. Rajgarhia to purchase residential flats to be constructed on his plot in East of Kailash, Delhi, for ₹32,07,500. The bank paid approximately 90% of the consideration upfront. The agreement specified the construction and sale of eight flats and a basement, with completion required within 18 months. When the defendant failed to ...
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Society Cannot Evade Decree by Raising Unauthorized Constructions, Rules Supreme Court
24Dec By The Legal ChamberNo Comments
Supreme Court

Society Cannot Evade Decree by Raising Unauthorized Constructions, Rules Supreme Court

The Supreme Court upheld the enforceability of a cooperative court's decree for specific performance, ruling that subsequent unauthorized constructions and unapproved plot mergers do not render a decree inexecutable. The Court directed the removal of obstructing structures to facilitate the allotment and delivery of vacant possession to the decree-holder, affirming the executability of the award. Facts Of The Case: The appellant, Southern Nagpur Co-operative Society Limited, was directed by the Cooperative Court in a 2000 award to allot Plot No. 5A to its member, respondent Ganpati Yadavrao Kumbhare, a decree upheld in subsequent appeals. During execution proceedings, the appellant society objected, claiming the plot had lost its identity as it was merged with adjoining Plots 4 and 4A in...
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Supreme Court Clarifies: Licensee Must Pay Arrears, Not Liquidated Damages, at Interim Stage
4Dec By The Legal ChamberNo Comments
Supreme Court

Supreme Court Clarifies: Licensee Must Pay Arrears, Not Liquidated Damages, at Interim Stage

In a suit for eviction under a lapsed license agreement, the Supreme Court ruled that the trial court cannot grant liquidated damages as an interim measure under Order XXXIX Rules 1 & 2 CPC. However, it upheld the application of Order XV-A CPC (Bombay Amendment), directing the licensee to pay ascertained arrears and ongoing license fees with annual increments, failing which the defense can be struck off. Facts Of The Case: The case originated from a Leave and License Agreement executed on 08.10.2013 between the appellant licensors and the respondent licensee for 36 months, from 01.11.2013 to 31.10.2016, with a 7% annual increase in license fee. Clause 19 stipulated liquidated damages of Rs. 10,000 per day if the licensee failed to vacate upon expiry. After the license period lapsed, ...
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Specific Performance Suit Fails: Supreme Court Explains Why Buyer Must Vacate Despite Long Possession
4Dec By The Legal ChamberNo Comments
Supreme Court

Specific Performance Suit Fails: Supreme Court Explains Why Buyer Must Vacate Despite Long Possession

The Supreme Court affirmed the executability of a warrant of possession, ruling that a party who receives substantial monetary compensation in lieu of specific performance cannot retain possession of the property. The Court held that equity prevents unjust enrichment and that execution proceedings exist to enforce judgments, not to facilitate windfalls for unscrupulous litigants. Facts Of The Case: On 12.06.1989, the defendants agreed to sell a property to the plaintiff for ₹14,50,000, with ₹25,000 paid as earnest money. Possession of the vacant ground floor was handed over to the plaintiff. In 1990, the plaintiff first filed and withdrew a suit for permanent injunction. Subsequently, in June 1990, the plaintiff filed a suit for specific performance, which was decreed by the Trial Court ...
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Fabricated Documents Can’t Validate a Sale, Rules Supreme Court in Insolvency Case
19Nov By The Legal ChamberNo Comments
Supreme Court

Fabricated Documents Can’t Validate a Sale, Rules Supreme Court in Insolvency Case

The Supreme Court held that for a sale by an Official Receiver to be protected under Section 37 of the Provincial Insolvency Act, 1920 upon annulment, the underlying transaction must be valid and attain finality. A transfer based on a fundamentally flawed and fabricated agreement is not a "duly made" disposition and does not survive the annulment of insolvency, requiring the property to revert to the debtor. Facts Of The Case: The case originated from a partnership firm, M/s Gavisiddheshwara & Co. Following the death of partner Singamasetty Subbarayudu, his son (the appellant) was inducted. Due to family indebtedness, the appellant was alleged to have offered his inherited one-anna share for sale via a letter. Respondent Allam Karibasappa claimed to have accepted this offer, assertin...
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Delayed Counter-Claim for Specific Performance Dismissed by Supreme Court
1Nov By The Legal ChamberNo Comments
Supreme Court

Delayed Counter-Claim for Specific Performance Dismissed by Supreme Court

This Supreme Court judgment clarifies that a counter-claim under Order VIII Rule 6A of the CPC must be filed against the plaintiff, not solely against a co-defendant. Furthermore, while no specific time limit is prescribed, a counter-claim cannot be permitted after the framing of issues in the suit, as it defeats the purpose of speedy justice and procedural efficiency. Facts Of The Case: The appellant, Rajul Manoj Shah, filed a suit in 2012 concerning a bungalow she jointly owned with her sister-in-law (defendant no.1). She sought a declaration that her sister-in-law had no right to transfer the property and to nullify an Agreement to Sell dated 21.10.2011 executed in favor of respondent no.1, Kiranbhai Patel (defendant no.2). After the sister-in-law passed away in ...
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Supreme Court Rules :You Can’t Claim Property with Just a Will or Power of Attorney
6Oct By The Legal ChamberNo Comments
Supreme Court

Supreme Court Rules :You Can’t Claim Property with Just a Will or Power of Attorney

This Supreme Court judgment reaffirms that an Agreement to Sell, General Power of Attorney, Will, or receipt of payment does not constitute a transfer of title under the Transfer of Property Act, 1882. Only a duly registered sale deed confers ownership. The doctrine of part-performance under Section 53A is inapplicable without the transferee being in possession, and a Will must be proved in strict compliance with the Indian Succession Act and Evidence Act. Facts Of The Case: The case involved a dispute over a property in Delhi between two brothers, Suresh Chand (Plaintiff) and Ramesh Chand (Defendant No. 1), after the death of their father, Kundan Lal. Suresh claimed ownership of the property based on a set of documents executed by their father on a single day in 1996, including a Genera...
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Supreme Court Denies Specific Performance Over Tainted Agreement: Readiness to Pay Not Enough
23Sep By The Legal ChamberNo Comments
Supreme Court

Supreme Court Denies Specific Performance Over Tainted Agreement: Readiness to Pay Not Enough

The Supreme Court upheld the denial of specific performance, ruling that a material alteration in the sale agreement—visibly apparent from the use of different ink for a property's description—vitiated the contract. Courts are not always obligated to seek expert opinion under Section 73 of the Evidence Act when such an alteration is plainly discernible upon a mere perusal of the document itself. Facts Of The Case: The plaintiff-appellant, Syed Basheer Ahmed, entered into a sale agreement dated July 15, 1984, with the first defendant for the purchase of two properties: Item No. 1 (owned by the first defendant) and Item No. 2 (owned by a third party). The total agreed consideration was Rs. 56,000/-, with an advance of Rs. 1,000/- paid. The agreement stipulated that the sale deed was to be ...
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