Urmila Devi & Ors. v. The Deity, Mandir Shree Chamunda Devi & Ors.
Background
The respondents (original defendant Nos. 2 to 6) had agreed in 1989 to sell their share in certain land to the predecessor of the appellants for Rs. 90,000, received full payment, and handed over possession, on which the buyer built three shops. Despite this, they later executed a gift deed of the same land in favour of a temple deity (defendant No. 6/respondent No. 1). The buyer sued for specific performance; the trial court decreed in his favour and declared the gift deed void to the extent of the sold share, but the High Court modified this into a money decree instead of ordering transfer of the land itself.
Decision Breakdown
The Supreme Court noted that, in the interim, the land itself had been acquired by the government and compensation had been determined in favour of the temple (defendant No. 6), whose name appeared in revenue records, even though the gift deed covering the appellants' share had already been declared void by the courts below. Since the temple was therefore not legally entitled to the compensation attributable to the appellants' share, the Court held that fairness required the appellants to be compensated from the acquisition proceeds rather than leaving them only with an unenforceable decree for land that no longer existed as such. It directed that Rs. 10 lakh be paid to the appellants out of the acquisition compensation, with the balance going to the original land-owning respondents, adjusting for whoever actually received the compensation. The appeal was allowed accordingly, modifying the High Court's judgment to this extent.
Lesson Learnt
When land that is the subject of a specific-performance dispute gets compulsorily acquired before the litigation ends, courts can mould the relief to direct that a fair share of the acquisition compensation goes to the party who was wrongfully denied the land, rather than leaving that party with a hollow decree.