Urvashi Aggarwal (Since Deceased) Through LRs. & Anr. v. Kushagr Ansal & Ors.
Background
In 1974, the plaintiffs entered into an agreement to purchase a Jor Bagh, New Delhi property for Rs. 1,85,000, with the sale deed to be executed by 31 March 1975 after the seller obtained certain government permissions. The plaintiffs paid Rs. 70,000 towards the price and claimed to have been put in partial possession, but the sale deed was never executed, and in 1987, twelve years later, they sued for specific performance after the seller's family refused to go through with the sale. Both the trial court and the Delhi High Court dismissed the suit, holding it was filed beyond the three-year limitation period and that the plaintiffs had failed to prove they were ready and willing to perform their part of the bargain.
Decision Breakdown
The Supreme Court agreed with the lower courts that the suit was time-barred: the limitation period ran from the date fixed for performance (31 March 1975), and the plaintiffs' twelve-year silence amounted to an abandonment of the agreement, so a decree of specific performance could not be granted. However, taking a practical view, the Court held that since the plaintiffs had actually handed over Rs. 70,000 back in 1975 and property prices in Delhi had risen enormously since then, simply refunding that amount with interest (as the High Court had ordered) would be grossly inadequate. The Court therefore increased the compensation payable to the plaintiffs from a refund with 24% interest to a lump sum of Rs. 2 crore, modifying the judgment to that extent while dismissing the appeal in all other respects.
Lesson Learnt
Even when a suit for specific performance fails because it was filed too late, courts can still use their equitable powers to ensure a fair monetary outcome reflecting real-world factors like decades of property appreciation, rather than leaving a party with only a token refund of money paid long ago.