Janardan Das & Ors. vs Durga Prasad Agarwalla & Ors.
Background
After the original owner of a property in Baripada, Odisha died, his five heirs (two sons, three daughters) became co-owners. The plaintiffs (petrol pump dealers operating on the land) entered into an agreement to buy the property from just one son and a deceased second son's heir for Rs. 5,70,000, on the understanding that the three sisters, who together held a 3/5th share and had not signed, would come within three months to also execute the sale deed. That never happened. Instead, all five original co-owners together sold the same property to a different set of buyers (the appellants) via a registered sale deed for Rs. 4,20,000. The plaintiffs sued for specific performance of their earlier, incomplete agreement; the trial court dismissed their suit, but the Orissa High Court reversed it and ordered the sale deed be executed in the plaintiffs' favour.
Decision Breakdown
The Supreme Court allowed the appeal, set aside the High Court's judgment, and restored the trial court's dismissal of the suit. It held that the plaintiffs failed to prove "continuous readiness and willingness" to perform the contract, as required under Section 16(c) of the Specific Relief Act. They took no concrete steps (no notices, no direct contact) to secure the sisters' consent within the stipulated three months, and only sued after the rival sale deed was executed, suggesting an afterthought. The Court also found that the son who signed the original agreement had no valid authority to bind his sisters: his old, unregistered power of attorney had been effectively narrowed by a later registered partition deed limiting him only to collecting rent, and the agreement itself never even mentioned the power of attorney. Since specific performance is a discretionary remedy, and the appellants were bona fide purchasers who had already validly acquired the property from all five rightful co-owners, it was neither just nor equitable to disturb their title; the plaintiffs were instead awarded a refund of their earnest money plus interest/expenses.
Lesson Learnt
A buyer seeking court-ordered enforcement of a property sale agreement must actively and continuously show genuine effort to fulfil their own obligations (like securing all co-owners' consent): mere reliance on assurances from one seller is not enough, and courts will not disturb a later, properly executed sale to a genuine bona fide purchaser over an earlier, incomplete agreement.