Case Note & Summary
The case involves an agreement to sell dated 13.05.1964 between Mohinder Kaur (vendor) and Bahadur Singh (vendee) for sale of land for Rs.5605/-, with Rs.1000/- paid as earnest money. Possession was handed over immediately, and the sale deed was to be executed within one month of the decision of a pending civil appeal. Clause 3 of the agreement provided that if the appeal was not decided within one year, the vendee would pay customary rent to the vendor. The appeal was decided on 17.01.1977, about 13 years later. Bahadur Singh filed a suit for specific performance, but he had not paid any rent during this period. The trial court, first appellate court, and High Court decreed the suit, holding that the rent payment was not a reciprocal promise. The Supreme Court reversed, holding that the payment of rent was an essential term of the contract. The Court applied Section 16(c) of the Specific Relief Act, 1963, which requires the plaintiff to prove readiness and willingness to perform essential terms. Bahadur Singh's failure to pay rent for 13 years and his denial of liability in replication showed he was not ready and willing. The Court also noted that specific performance is discretionary under Section 20, and the vendee's conduct made it inequitable to grant relief. The appeals were allowed, the suit for specific performance was dismissed, but the alternative claim for refund of earnest money and damages was remitted to the trial court for fresh consideration.
Headnote
A) Contract Law - Specific Performance - Reciprocal Promises - Section 51 Contract Act, 1872 - The question whether promises are reciprocal depends on the facts of each case. In the present case, the vendee's promise to pay customary rent after one year of possession was held to be a reciprocal promise and an essential term of the agreement to sell (Paras 9-10). B) Specific Relief Act - Readiness and Willingness - Section 16(c) - The plaintiff must aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract. The vendee's failure to pay rent for 13 years and denial of liability in replication showed lack of readiness and willingness (Paras 10-13). C) Specific Relief Act - Discretionary Relief - Section 20 - The relief of specific performance is discretionary and not granted merely because it is lawful. The court may refuse relief where it would be inequitable, considering the conduct of the plaintiff. The vendee's non-payment of rent for 13 years made it inequitable to grant specific performance (Paras 14-15).
Issue of Consideration
Whether a vendee who fails to perform an essential term of the contract (payment of customary rent) is entitled to the discretionary relief of specific performance of the agreement to sell.
Final Decision
The Supreme Court allowed the appeals, set aside the judgments of the lower courts, and dismissed the suit for specific performance. The alternative claim for refund of earnest money and damages was remitted to the trial court for fresh consideration.
Law Points
- Specific performance
- reciprocal promises
- essential terms
- readiness and willingness
- discretionary relief
- Section 16(c) Specific Relief Act
- 1963
- Section 51 Contract Act
- 1872
- Section 20 Specific Relief Act
