1. Factual Background and Procedural History
The present case arose out of a civil dispute concerning the enforcement of an agreement to sell agricultural land in Madhya Pradesh between the appellant Suresh Chandra (purchaser) and respondent Parasram (vendor).
Facts of the Case
On 4 February 2006, Parasram executed an agreement to sell in favour of Suresh Chandra for agricultural land situated in District Sehore, Madhya Pradesh, for a total sale consideration of ₹6,50,000, out of which ₹1,00,000 was paid as earnest money. The balance was to be paid within three months, upon execution of the sale deed.
Despite repeated demands, the sale deed was not executed. Suresh Chandra claimed to have always been ready and willing to perform his part of the contract and filed a civil suit for specific performance before the Civil Judge, Class-II, Sehore, when the respondent failed to appear for registration.
Procedural History
- Trial Court:
The trial court decreed the suit, directing Parasram to execute the sale deed, holding that the plaintiff had proved readiness and willingness and that the vendor’s refusal was unjustified. - First Appellate Court (District Judge, Sehore):
Reversed the decree, finding that the purchaser failed to establish continuous readiness and willingness to pay the balance consideration. It noted that the plaintiff neither produced documentary proof of funds nor issued any notice within the stipulated period. - High Court of Madhya Pradesh (Second Appeal):
Affirmed the findings of the appellate court, holding that the lower court’s view was based on proper appreciation of evidence. - Supreme Court:
The appellant approached the Supreme Court under Article 136, challenging the concurrent findings of the appellate and High Court, contending that the reversal ignored the settled principle that readiness can be inferred from conduct.
2. Identification of Legal Issues
The Supreme Court addressed the following questions:
- Whether the plaintiff established continuous readiness and willingness to perform his part of the contract as required under Section 16(c) of the Specific Relief Act, 1963.
- Whether the lower courts were justified in denying specific performance despite the initial payment and existence of a valid agreement to sell.
- Whether mere assertion of readiness in pleadings, without evidence of financial capacity, satisfies the statutory requirement under Section 16(c).
3. Arguments of the Parties
Appellant (Purchaser – Suresh Chandra)
- Argued that he was always willing to pay the balance amount but the respondent avoided execution to resell the land at a higher price.
- Claimed that the agreement to sell and earnest payment proved his bona fide intention.
- Contended that courts below erred by expecting production of cash or bank statements, which is not mandated by law.
- Relied on:
- R.C. Chandiok v. Chuni Lal Sabharwal, (1970) 3 SCC 140
- Umabai v. Nilkanth Dhondiba Chavan, (2005) 6 SCC 243
- K.S. Vidyanadam v. Vairavan, (1997) 3 SCC 1
to argue that readiness can be inferred from consistent conduct and tender of earnest money.
Respondents (Vendor – Parasram & Others)
- Asserted that the plaintiff failed to perform within three months and made no effort or notice seeking registration within the stipulated period.
- The plaintiff had insufficient funds, as shown by his own admissions during cross-examination.
- Contended that mere lip service to readiness in pleadings, without proof of financial ability, is not enough under Section 16(c).
- Relied on:
- N.P. Thirugnanam v. R. Jagan Mohan Rao, (1995) 5 SCC 115
- Man Kaur v. Hartar Singh Sangha, (2010) 10 SCC 512
- K. Narendra v. Riviera Apartments (P) Ltd., (1999) 5 SCC 77
4. Court’s Analysis and Reasoning
The Bench of Justices Hrishikesh Roy and Rajesh Bindal undertook a detailed examination of the evidentiary record and statutory mandate of Section 16(c) of the Specific Relief Act, 1963.
(a) Requirement of Continuous Readiness and Willingness
The Court reiterated that “readiness and willingness” is not a mere formality but a substantive precondition. The plaintiff must establish:
- financial capacity,
- genuine intent to perform, and
- consistent conduct throughout the contractual period.
The Court cited N.P. Thirugnanam v. Jagan Mohan Rao (1995) to reaffirm that readiness must exist from the date of contract till the decree.
(b) Evaluation of Evidence
The Court noted:
- The appellant did not produce bank passbooks, withdrawal records, or correspondence evidencing financial readiness.
- There was no notice or communication within three months demanding execution.
- The trial court erroneously assumed readiness merely from the existence of an agreement and partial payment.
Thus, the appellate and High Court findings were well-reasoned and not perverse.
(c) Discretion under Section 20
The Court observed that specific performance is a discretionary equitable remedy, not an automatic right. The plaintiff’s omission to show bona fide readiness disentitled him from equitable relief.
The Court quoted K.S. Vidyanadam to emphasize that time, though not the essence, cannot be rendered meaningless through lax enforcement.
(d) No Substantial Question of Law
As the appellate and High Court findings were based on concurrent appreciation of facts, the Supreme Court held that no substantial question of law arose for interference under Article 136.
5. Final Conclusion and Holding
The Supreme Court dismissed the appeal, affirming the decisions of the appellate and High Court. It held that:
- The plaintiff failed to establish continuous readiness and willingness to perform his contractual obligations.
- Specific performance cannot be decreed on the basis of mere assertions or token advance payments.
- Equity aids the vigilant, not those who slumber on their rights.
Key Principle:
“A plaintiff seeking specific performance must not only aver but prove readiness and willingness by tangible evidence of conduct and financial ability. Mere verbal assurances or delayed actions do not meet the test under Section 16(c).”
FAQs:
1. What does Section 16(c) of the Specific Relief Act require?
It mandates that a plaintiff seeking specific performance must prove continuous readiness and willingness to perform their part of the contract from inception to decree.
2. Can specific performance be granted if the buyer lacks proof of funds?
No. The Supreme Court consistently holds that failure to demonstrate financial readiness bars the remedy of specific performance.
3. Is time the essence in property sale agreements?
Generally, time is not the essence, but undue delay and inaction by the buyer may still defeat specific performance claims.
4. What is the difference between readiness and willingness?
‘Readiness’ refers to the financial and practical capacity to perform, while ‘willingness’ reflects genuine intent and consistent conduct toward completion.
5. Can the Supreme Court interfere with concurrent findings in specific performance suits?
Only if the findings are perverse or legally erroneous. Otherwise, concurrent factual determinations are final and binding.
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