Property Lawyer: In view of alternate prayer of refund in the suit, the specific performance of an agreement was refused; SC.

Supreme Court of India

Justice Abhay Manohar Sapre and Justice Dinesh Maheshwari

The SC holds that the Sale during the pendency of the suit is not void-ab-initio as per doctrine of lis pendens. It was held that the effect of Section 52 of Transfer of Property Act would only be that the said sale transactions in favour of the purchaser(s) shall have no adverse effect on the rights of the plaintiffs and shall remain subject to the final outcome of the suit in question. 

In the present case { MADHUKAR NIVRUTTI JAGTAP & ORS. v. SMT. PRAMILABAI CHANDULAL PARANDEKAR & ORS. } the SC holds that the High Court rightly reversed the concurrent findings of lower courts, and had rightly arrived at the finding that the plaintiff was ready and willing to perform his part and and the agreement in question was for 'Sale'. 

However, the SC sets aside that part of HC Judgment which granted specific performance; and instead granted compensation in lieu of specific performance, and holds that firstly, the agreements in question were executed way back on 20.09.1965 and 28.04.1966. Secondly, the plaintiffs had paid an amount of Rs. 6,000/- as on 28.04.1966 against the sale consideration of Rs 22,951/- when the supplementary agreement was executed. Thirdly, though the plaintiffs alleged delivery of possession of the land in question to them, the evidence on record shows that vendors and thereafter, the subsequent purchasers remained in effective possession thereof. Fourthly, the High Court has taken note of the fact that as on the date of its decision (01.08.2007), the subsequent purchasers were in possession of the land in question for about 40 years. Fifthly, the High Court has found that the land in question carried much higher valuation at the time of passing of the judgment in second appeal and hence, enhanced the sale consideration to Rs. 10,000/- per acre. Sixthly, the plaintiffs, even while seeking specific performance, consciously prayed for the alternative reliefs of recovery of amount paid by them with interest and compensation to the tune of Rs 15,000/-. Seventhly, the plaintiff No. 3 had categorically deposed before the Court as PW1 that he was not entitled to the land in question for being not an agriculturist and he had relinquished his rights in favour of the plaintiff Nos. 1 & 2. Eighthly, the plaintiff No. 1 had expired during the pendency of suit and the plaintiff No. 2 had expired during the pendency of the appeal before SC. Ninthly, the plaintiff No. 2, while deposing as PW2 had stated that in case specific performance was not granted, she ‘may be granted alternative relief and compensation with interest’. The said factors weighed with the SC, while inspite of fulfilling the requisite parameters for grant of specific performance - the compensation to the tune of 15 lakhs was only ordered by the SC to be paid to the buyer/ plaintiff and the specific performance was refused.