SUIT FOR SPECIFIC PERFORMANCE OF CONTRACT

 INTRODUCTION

Specific performance is a remedy developed by principle of equity. A party to a contract who is

damaged because the contract is breached by another party has the option to file a suit for
specific performance compelling to perform his part of contract. Before an equity court will
compel specific performance, however, the contract must be one which can be specifically
performed. Section 16 (c)  of the Act envisages that plaintiff must plead and prove that he had
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 those terms the performance of which has been
prevented or waived by the defendant. In our country, most of the specific performance suits
relate to sales of immoveable properties and to some extent, transfer of shares. As the law of
specific performance is basically founded on equity, considerations such as conduct of the
plaintiff, the element of hardship that may be caused to one of the parties, the availability of
adequate alternative relief and such other matters are taken into consideration. It is a
discretionary relief.

LAW ON SPECIFIC PERFORMANCE OF CONTRACT

A contract is an agreement upon sufficient consideration to do or not to do a particular act. The

party on whom this contractual obligation rests must not fails to discharge such obligation. In
case of his failure, the other party will have a right sue for performance of the contract. This is
called ‘Specific Performance’. Orders of specific performance are granted when damages are
not an adequate remedy, and in some specific cases such as land sale. Such orders are
discretionary, as with all equitable remedies, so the availability of this remedy will depend on
whether it is appropriate in the circumstances of the case. Under current law, courts grant
specific performance when they perceive that damages will be inadequate compensation.
Specific performance is deemed an extraordinary remedy, awarded at the court’s discretion

Sections 9-25 deal with specific performance of contracts: Basic rules.

1. Decree of specific performance is discretionary relief.

2. There should be a valid contract.
3. If damages are an adequate remedy, no specific performance would be ordered.
4. For the act which requires continued supervision of the Court, no specific performance
would be ordered. (Sec.14 (1) (d))
5. no specific performance would be ordered for contracts for personal work or service
 6. ‘Equity’ will insist on the principle of mutuality
7. The person against whom the relief is claimed may take plea by way of defence under
law relating to contract. (Sec.9)

SUIT FOR SPECIFIC PERFORMANCE:

Illustration

A is owner of land. He executed an unregistered agreement of sale in favour of B and received

Rs. 50,000/- as an advance out of sale price of Rs.1,00,000/-. A has to execute a Regd. Sale deed
within three months from date of execution of agreement of sale. But, A refused to execute
Regd. Sale deed and sold the said property to C for higher price. B can sue against A  for
specific performance.

From the above illustration, no doubt, B can file a suit for specific performance. This case
involve several aspects such as, whether plaintiff is ready and willing to perform his part of
contract or not; when would time is essence of contract?; Can C be impleaded in the suit as
party? Is escalation of price is a ground in such a suit? Question of Lis Pendens; whether B is
entitled for damages and compensation or not; whether an unregistered agreement of sale is
admissible or not  etc. All these aspects are dealt in the following paragraphs with relevant
illustrations.

ELEMENTS THAT ARE INVOLVED IN A SUIT FOR SPECIFIC PERFORMANCE OF

SUIT:-

Valid Contract

Normally, suit for specific performance of contract based on agreement of sale. Vague and
uncertain agreement could not be given effect to.1 It was observed in Ambica Prasad vs Naziran
Bibi, 2 that there should be a valid contract for suit for specific performance of contract.3

Unregistered Agreement of Sale

Unregistered agreement of sale is admissible in evidence under Section 49(c) of the Registration

Act in a suit for specific performance of contract. Unregistered sale deed is admissible in
evidence in a suit for specific performance.4

1
Vimlesh Kumari Kulshrestha vs Sambhajirao, 2008 (2) Supreme 127
2
AIR 1939 All 64
3
Balram v Natku, AIR 1928 PC 75
4
S.Kaladevi vs. V.R Somasundaram AIR 2010 SC 1654
 Conduct of the parties:-

Any person seeking benefit of specific performance of contract must manifest that his conduct
has been blemishes.5 Similarly, conduct of defendant cannot be ignored. 6The relief of specific
performance is discretionary.7It was held in Aniglase Yohannan v. Ramlatha, 8that if the
pleadings manifest that the conduct of the plaintiff entitles him to get the relief on perusal of the
plaint he should not be denied the relief.

Readiness and Willingness:-

Section 16(c) of the Act mandates the plaintiff to aver in the plaint and establish the fact by
evidence aliened that he has always been ready and willing to perform his part of the contract.
Distinction between “readiness” and “willingness” is that the former refers to financial capacity
and the latter to the conduct of the Plaintiff wanting performance.  The plaintiff’s readiness and
willingness, which is a condition precedent, must be in accordance with the terms of the
agreement9, however, the plaintiff need not carry money in his hand. 10 In a suit for specific
performance, plaintiff is to approach Court with clean hands.11 Right from the date of the
execution till date of the decree he must prove that he is ready and has always been willing to
perform his part of the contract.12 Even subsequent purchaser is entitled to raise objection as to
readiness and willingness.13

Time is the essence of contract:-

From the decision of a Constitution Bench of the Hon’ble Supreme Court in Chand
Rani vs.Kamal Rani 14, it is clearly known that in the case of sale of immovable property, time
is never regarded as the essence of the contract. An intention to make time the essence of the
contract must be expressed in unequivocal language. As to the point of limitation is concerned,
the suit for specific performance has to be filed within reasonable time which depends upon
facts and circumstances of each case. Even if it is not of the essence of the contract, the Court
may infer that it is to be performed in a reasonable time if the conditions are:

1. from the express terms of the contract;

5
H.P.Pyarejan vs Dasappa, AIR 2006 SC 1144
6
Silvey vs Arun Varghese, AIR 2008 SC 1568.
7
V.R.Sudhakara Rao vs T.V.Kameswari, (2007) 6 SCC 650
8
2005 (7) SCC 534
9
Bala Krishna vs Bhgawan Das, AIR 2008 SC 1786
10
M.K.Watts vs Usha Sharma, AIR 2004 P&H 295
11
G.Jayashree vs Bhagawan Das, AIR 2009 SC 1749
12
N.P. Thirugnanam v. Dr. R. Jagan Mohan Rao and Ors, (1995) 5 SCC 115 at para 5
13
AIR 2009 SC 2157
14
1993 (1) SCC 519
2. from the nature of the property; and

3. from the surrounding circumstances, for example: the object of making the contract.15

Adding parties in specific performance suit:-

Order 1 Rule 10 CPC is wider than the scope of Order 22 Rule 10 CPC as to person whose
presence before the court is necessary or proper for effective adjudication of the issue involved
in the suit. . Order 22 Rule 10 CPC is an enabling provision and that it has certain parameters to
continue the suit where right to sue is survival. Order 22, Rule 10, C.P.C. speaks of cases of an
assignment, creation or devolution of any interest during the pendency of a suit and the suit may,
by leave of the Court, be continued by or against the person to or upon whom such interest has
come or devolved.16

DRAFT FOR SUIT FOR SPECIFIC PERFORMANCE

Facts:

15
Smt. Chand Rani (dead) by LRs. Vs. Smt. Kamal Rani (dead) by LRs, 1993 (1) SCC 519
16
Lingaraja Mohanty vs Binodini Mohanty & Ors. on 20 April, 2011; Thomson Press (India) Ltd. Vs. Nanak
Builders and Investors P. Ltd. and Ors, 2013(3)SCALE26).
 IN THE COURT OF THE CIVIL JUDGE, SENIOR DIVISION,
PUNE, AT PUNE

Special Civil Suit No.20/2020

Mr. ABC, )
Age about yrs., )
Occupation – Business, )
Residing at – 123, MG Road, Pune – 411001 ) …Plaintiff

versus

(1) Mr. XYZ, )

Age about years, )
Occupation – Service, )
Residing at – 489, F.C. Road, Pune – 411004 )

(2) Mr. DEF, )

Age about years, )
Occupation – Business, )
Residing at – 456, JM Road, Pune – 411004 ) …Defendants

SUIT FOR SPECIFIC

PERFORMANCE
VALUED AT RS.
1,00,00,000/-

THE PLAINTIFF ABOVENAMED MOST RESPECTFULLY

SHEWETH

1. Description of Property –
All that piece and parcel of flat bearing Flat No. 601, C-1
Wing, Vidya Apartments, Kothrud, Pune – 411038,
admeasuring about 1200 sq. ft. (One Thousand Two Hundred
Square Feet) and which is bounded as follows –
 On or towards East – By Flat No. 602
On or towards South – By 10 ft. wide common
area
On or towards West – By Survey No. 45
On or towards North – By Survey No. 43
(Hereinafter called and referred to as ‘the said Flat’ for the sake
of brevity and convenience).
2. That the Plaintiff states that the Plaintiff is a permanent resident
of Pune city, working at ABC Co. Pvt. Ltd. That the Defendant No. 1
is also a permanent resident of Pune, residing at the address mentioned
above.
[

3. That the Plaintiff states that the said Flat was owned by the
Defendant No. 1 herein and that the Defendant No. 2 is the subsequent
purchaser of the said Flat.
[

4. That the Plaintiff states that the Defendant No. 1 intended to

sell the said Flat to an eligible purchaser. That the Plaintiff herein
intended to buy a new house in Kothrud area in the city of Pune. That
the Plaintiff came to know of the Defendant No. 1’s intention to sell
the said Flat through a common friend namely Mr. PQR.
[

5. That the Plaintiff states that the Plaintiff and the Defendant No.
1 met at the residence of the Defendant No. 1 in the presence of Mr.
PQR in or about January, 2014 in order to discuss the sale of the said
Flat.
[

6. That the Plaintiff states that the Defendant No. 1 offered to sell
the said Flat at Rs. 1,00,00,000/- (Rupees One Crore Only). That the
said offer of the Defendant No. 1 was accepted by the Plaintiff and in
furtherance of the same the Plaintiff and the Defendant No. 1 had
decided to execute an agreement to sell in respect of the said Flat.
[[[

7. That the Plaintiff states that after several negotiations, an

agreement to sell dated 12-06-2015 was executed by and between the
Plaintiff and Defendant No. 1, duly registered with the office of Sub-
Registrar, Taluka Haveli, District Pune, at Serial No. 125/2015. A copy
of the said Agreement to Sell dated 12-06-2015 is produced herewith
for the kind perusal of this Hon’ble Court.
[

8. That the Plaintiff states that as per the terms of the said
Agreement to Sell, the Plaintiff was required to pay an earnest money
of Rs. 50,00,000/- (Rupees Fifty Lakhs Only) on or before 1 st June
2016, and was required to pay the balance consideration on or before
1st June 2018. That the Defendant No. 1 was required to deliver vacant
and peaceful possession of the said Flat on or before 1st June 2018.
[

9. That the Plaintiff states that till date the Plaintiff has paid Rs.
90,00,000/- (Rupees Ninety Lakhs Only) by various cheques of Rs.
10,00,000/- (Rupees Ten Lakhs Only) each, by completely following
the terms of the contract diligently and punctually. The Plaintiff craves
leave of this Hon’ble Court to refer to and rely upon the said cheques.
[[

10. That the Plaintiff states that on or about 15 th November 2017,

when the Plaintiff visited the said Flat for inspection, the Plaintiff
observed that the Defendant No. 2 is occupying the said Flat.
[

11. That the Plaintiff states that the Plaintiff tried to find out the
antecedents of Defendant No. 2 and came to know that the Defendant
No. 1 has executed a Sale Deed dated 01-10-2017 in favour of
Defendant No. 2 registered with the office of the Sub-Registrar, Taluka
Haveli, District Pune at Serial No. 987/2017. The Plaintiff craves leave
leave of this Hon’ble Court to refer to and rely upon the said Sale Deed
dated 01-10-2017.
[

12. That the Plaintiff states that the Plaintiff has performed his part
of the contract diligently and punctually and is ready and willing to
perform his part in future by paying the balance consideration on or
before 1st June 2018. However, the Defendant No. 1 has refused to
adhere to his promise by executing a sale deed in favour of Defendant
No. 2.
[[

13. That the Plaintiff states that the Defendant No. 2 has not taken
proper care in relation to the said Flat. That had he taken due care and
caution, he would have had notice of the agreement to sell dated 12-
06-2015.
[

14. That the Plaintiff states that in furtherance of the

representations and promise made by the Defendant No. 1, the Plaintiff
raised a loan of Rs. 50,00,000/- (Rupees Fifty Lakhs Only) from the
State Bank of India, Deccan Branch. A copy of the said sanctioned
loan documents is produced herewith for the kind perusal of this
Hon’ble Court.
15. That the Plaintiff states that the Plaintiff has altered his position
by raising the said loan. That therefore, the Defendant No. 1 is now
estopped from withdrawing his own promise to the Plaintiff. That the
Defendant No. 1 is duty bound and under contractual obligation to
execute and register a sale lease deed in respect of the said Flat in
favour of the Plaintiff, on the agreed terms and conditions. However by
registering a sale deed in favour of Defendant No. 2, the Defendant
No. 1 has committed breach of contract.
[[[

16. That the Plaintiff states that since the Defendant No. 1 has
failed, neglected and avoided to execute and register the sale deed of
the said Flat in favour of the Plaintiff, on the agreed terms and
conditions, the Plaintiff is compelled to approach this Hon’ble Court
for the reliefs as prayed for.
17. That the Plaintiff states that upon gaining knowledge of the sale
deed dated 01-10-2017, the Plaintiff sent a notice to the Defendant No.
1 through his advocate on 30th November 2017. That the said notice
has not been replied to by the Defendant No. 1.
[
18. That the cause of action to the present suit firstly arose when
the Defendant No. 1 failed, neglected and avoided to execute and
register sale deed of the said Flat in favour of the Plaintiff, on the
agreed terms and conditions, in the manner stated hereinabove, and
executed Sale Deed dated 01-10-2017 in favour of Defendant No. 2. It
lastly arose, when despite the notice dated 30th November 2017, the
Defendant No. 1 refused to execute and register sale deed of the said
Flat in favour of the Plaintiff and continues to arise thereafter till
today.
[

19. That the present suit is for specific performance of agreement

to sell in respect of the said Flat, for consideration of Rs.1,00, 000/-
(Rupees One Crore Only) and therefore, valued at Rs.1,00,00,000/-
(Rupees One Crore Only). That appropriate Court fee has been paid
thereupon.
20. That this Hon’ble Court has jurisdiction to entertain and try the
present suit.
21. That the present suit is not barred by the law of limitation.

PRAYER
22. That the Plaintiff therefore, most humbly prays –
a. That the Defendants may kindly be directed to execute and
register sale deed of the Flat, which is more particularly described in
Paragraph No. 1 above, in favour of the Plaintiff, forthwith;
b. That it be declared that the Sale Deed executed by and
between Defendant No. 1 and Defendant No. 2 in respect of the said
Flat is patently illegal and not binding on the Plaintiff;
c. That the costs of the present suit throughout may kindly be
awarded in favour of Plaintiff;
d. For any other just and reasonable order to meet the ends of
justice and equity.
AND FOR THIS ACT OF KINDNESS, THE PLAINTIFF
ABOVENAMED, AS IN DUTY BOUND, SHALL EVER PRAY.

Place: Pune

Dated: 5th March, 2018 PLAINTIFF

Sd/-

Advocate for the Plaintiff

VERIFICATION

I, Mr. ABC, Age about years, Occupation –

Business, the Plaintiff above named, do hereby state on solemn
affirmation that what is stated in the above paragraphs 1 to 21 of the
Plaint are true and correct to the best of my knowledge and
information.

Solemnly affirmed on this 5th day of the month of March, 2018 at

Pune.

Place: Pune

PLAINTIFF
 IN THE COURT OF THE CIVIL JUDGE, SENIOR DIVISION,
PUNE, AT PUNE

Special Civil Suit No. 20/2020

Mr. ABC, )
Age about yrs., )
Occupation – Business, )
Residing at – 123, MG Road, Pune – 411001 ) …Plaintiff

versus

(1) Mr. XYZ, )

Age about years, )
Occupation – Service, )
Residing at – 489, F.C. Road, Pune – 411004 )

(2) Mr. DEF, )

Age about years, )
Occupation – Business, )
Residing at – 456, JM Road, Pune – 411004 ) …Defendants

WRITTEN STATEMENT ON BEHALF OF DEFENDANT NO. 1

IS AS UNDER:

1. That at the outset, this Defendant denies each and every

allegation as set out in the Plaint except to the extent that is specifically
stated herein. Mere non-reply to any particular statement/allegation by
this Defendant shall not be construed to be an acceptance on the part
this Defendant.
2. That the suit is not legal and tenable at law.
[

3. That the contents of paragraph (1) of the plaint describing the

said Flat are true and correct and hence admitted by this Defendant.
4. That the contents of paragraphs (2) and (3) of the plaint
describing the parties to the suit are true and correct and hence
admitted by this Defendant.
5. That this Defendant is not aware and does not admit the
contents of paragraph (4) of the plaint and puts the Plaintiff to strict
proof thereof.
6. That the contents of paragraph (5) of the plaint regarding the
meeting between the Plaintiff and this Defendant are true and hence
admitted by this Defendant.
7. That the contents of paragraph (6) regarding the consideration
price for the said Flat are true and hence admitted by this Defendant.
[

8. That the contents of paragraph (7) regarding execution of an

agreement to sell dated 12-06-2015 are true and hence admitted by this
Defendant.
9. That the contents of paragraph (8) of the plaint regarding the
terms and conditions of the agreement to sell are true and hence
admitted by this Defendant.
10. That the contents of paragraph (9) of the plaint regarding
payments made by the Plaintiff are false, misleading and frivoulous
and the same are denied by this Defendant.
11. That this Defendant states that the Plaintiff has purposely
suppressed the material facts from the court that the cheques tendered
by the Plaintiff have been dishonoured by the bank of this Defendant
upon presentation.

12. That time and again when this Defendant presented the cheques
issued by the Plaintiff for payment, the same were dishonored by the
Drawer Bank with the reason “Funds Insufficient”. A copy of the said
cheques alongwith the respective dishonour memos is produced
herewith for the kind perusal of this Hon’ble Court.
[
13. That this Defendant states that this Defendant wrote several
letters to the Plaintiff requesting him to tender a valid cheque in respect
of the said instalments. This Defendant craves leave to Hon’ble Court
to refer to and rely upon the said letters.
14. That this Defendant states that on or about 15 th July 2017, this
Defendant wrote a letter to the Plaintiff signifying his intention to
repudiate the contract. A copy of the said letter is produced herewith
for the kind perusal of this Hon’ble Court.
15. That this Defendant states that as a consequence of the notice
of repudiation of the agreement to sell dated 12-06-2015, the
contractual relations between the Plaintiff and this Defendant have
come to an end.
16. That this Defendant states and submits that as there were no
contractual relations existing between the Plaintiff and this Defendant,
this Defendant deemed fit to sell the said Flat to Defendant No. 2.
17. That this Defendant states that in light of the abovementioned
facts and circumstances, the Plaintiff is not entitled to the relief as
prayed for.
18. That this Defendant states that the Plaintiff has not approached
this Hon’ble Court with clean hands, and has not shown readiness and
willingness to perform his part of the contract.
19. That this Defendant states that the Plaintiff has suppressed
material facts from this Court and that the suit is baseless and without
merit
PRAYER
20. That this Defendant therefore, most humbly prays –
(a) That the suit of the Plaintiff may kindly be dismissed;
(b) That the Plaintiff may kindly be directed to pay exemplary
costs of Rs. 50,000/- to this Defendant; and
 (c) For any other just and reasonable order to meet the ends
of justice and equity.

AND FOR THIS ACT OF KINDNESS, THE

DEFENDANT ABOVENAMED, AS IN DUTY BOUND,
SHALL EVER PRAY.

Place: Pune

Dated: 5th April, 2018 DEFENDANT NO. 1

Sd/-

Advocate for Defendant No. 1

VERIFICATION

I, Mr. XYZ, Age about years, Occupation –

Service, the Defendant No. 1 abovenamed, do hereby state on
solemn affirmation that what is stated in the above paragraphs 1
to 19 of the Written Statement are true and correct to the best of
my knowledge and information.

Solemnly affirmed on this 5th day of the month of April, 2018

at Pune.

Place: Pune
DEFENDANT NO. 1