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P. Daivasigamani vs S. Sambandan

Civil Appeal · 2022 INSC 1070Decided 12 Oct 2022
Civil Appeal No. 9006 of 2011
Sanjiv Khanna · Bela M. Trivedi

Background

The appellant (P. Daivasigamani) agreed on 05.10.1989 to sell about 1 acre of land in Ayanambakkam, Chennai to the respondent (S. Sambandan) for Rs. 6,50,000, receiving Rs. 50,000 as earnest money, with the sale to be completed within six months. The respondent repeatedly asked the appellant to execute the sale deed, sent a formal notice (which was refused), and even published public notices warning others against dealing with the property, but the appellant never performed his side of the bargain. The respondent sued for specific performance in the Trial Court, which instead only ordered refund of the earnest money with interest; the Madras High Court reversed this on appeal and granted specific performance and an injunction, which the original seller then challenged before the Supreme Court.

Decision Breakdown

The Supreme Court upheld the High Court's finding that the respondent-buyer had duly pleaded and proved his continuous "readiness and willingness" to perform the contract as required under Section 16(c) of the Specific Relief Act, relying on the three-judge bench precedent in Syed Dastagir, which holds that such compliance must be judged in substance, not by rigid technical wording. The Court found no illegality in the High Court's judgment and confirmed the decree of specific performance. However, recognising the steep rise in property prices since the 1989 agreement and that the seller had enjoyed possession of the land throughout the decades-long litigation, the Court modified the relief: the buyer was directed to deposit an additional Rs. 1 crore (over and above earlier deposits) within eight weeks, after which the seller must execute the sale deed and could withdraw the deposited amount.

Lesson Learnt

A buyer seeking specific performance of a property sale agreement must clearly plead and prove continuous readiness and willingness to perform, but even where a decades-old decree is upheld, courts can mould the final relief (such as ordering an additional payment) to account for changed circumstances like a sharp rise in property value, balancing fairness to both sides.

Official source (sci.gov.in)View Judgment (PDF)

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