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Synopsis

The Supreme Court has said that the grant of a decree for specific performance is always discretionary and the exercise of discretion depends on several factors, including the conduct of the plaintiff.

The court noted that as such, a relief is an equitable relief and a person who seeks equity must do equity. 

A bench of Justices Abhay S Oka and Sanjay Karol emphasised the relief of specific performance is discretionary and equitable.

In the instant case, the bench said, "Considering the plaintiffs' conduct of making false and/or incorrect statements in the plaint, which were very material, we hold that the plaintiffs are disentitled to relief of specific performance."

The matter arose out of an agreement to sale entered into in 1980 by plaintiff Major General (Rtd) Darshan Singh with Brij Bhushan Chaudhary for a plot in Chandigarh for a sum of Rs 3,50,000, on payment of earnest money of Rs 30,000. Upon negotiation, the price was reduced to Rs 2,90,000. However, defendant allegedly changed mind after a price raise in the vicinity.

 

Plaintiff filed a suit for specific performance and in alternative sought damages of Rs 40,000.

 

The defendant contested the suit, contending that the suit property belonged to his Hindu Undivided Family and the members of the family were in joint possession of the suit property. 

 

The trial court declined to grant relief of specific performance but passed damages to sum of Rs 40,000. It also said the theory of the plaintiffs that there was a fresh agreement under which the price was reduced to Rs 2,90,000 was not established. The district dismissed the appeal. The High Court, in the second appeal, held that the suit property was the HUF property. It confirmed the decrees passed by the trial court and the first appellate court.

 

After hearing the counsel, the bench noted in the plaint, the plaintiffs have not disclosed that the defendant executed the suit agreement in his capacity as the Karta of HUF and that the suit property was HUF property. 

 

"In his cross examination, the first plaintiff accepted that the suit property belonged to HUF, and it was accordingly mentioned in the draft sale deed. Though the first plaintiff knew that the suit property was HUF property, this fact was suppressed in the plaint," it said.

 

The court further noted the case pleaded in the plaint regarding the price reduction was factually incorrect.

 

"The conduct of the first plaintiff does not stop here," the bench said, pointing out in plaint, he claimed the suit property was delivered but in cross examination, he said, he never took possession of suit property.

 

The court thus held that the trial court, appellate court and High Court were justified in denying discretionary relief of specific performance to the plaintiffs.

 

The bench, however, modified the decree of the trial court by directing that the sum of Rs 40,000 will carry interest at the rate of 6% per annum from the date of the decree of the trial court till its payment or realisation.