Suit for specific performance for sale of immovable property filed within limitation cannot be dismissed on sole ground of delay or laches unless time being of the essence, and sale could not be made due to fault of the purchaser – SC
ABCAUS Case Law Citation
ABCAUS 3405 (2020) (10) SC
Important case law relied upon by the parties:
Mathura Prasad Bajoo Jaiswal v. Dossibai N.B. Jeejeebhoy, (1970) 3 SCR 830
Vishwa Nath Sharmav. Shyam Shanker Goela, (2007) 10 SCC 595
Van Vibhag Karamchari Griha Nirman Sahkari Sanstha Maryadit v. Ramesh Chander, (2010) 14 SCC 596
Nirmala Anand vs. Advent Corporation (P) Ltd., (2002) 8 SCC 146
In a recent judgment the Hon’ble Supreme Court have held that a suit for specific performance filed within limitation cannot be dismissed on the sole ground of delay or laches unless where immovable property is to be sold within a certain period, time being of the essence, and it is found that there is a default on the part of the purchaser, the sale could not take place within the stipulated time.
In the instant case, the property in dispute originally belonged to a Hindu Undivided Family (HUF). As a result of a partial partition of the HUF, the first vendor had become the owner who mortgaged the said property.
Later, the vendor offered to sell the said property to the purchaser(s), free from all encumbrances and to get all clearances required.
Due to the failure of the vendor to obtain necessary permissions from Civic authorities for land ceiling, a suit for specific performance that was filed by the plaintiff appellant against the defendants.
The matter travelled from the Single Judge to the Division/Full Bench of the Hon’ble High Court and it was inter alia held that due to the bar contained in State Land Ceiling Act the agreement was void ab initio.
Before the Hon’ble Supreme Court, the appellant contended that the Hon’ble High Court had passed its decree when the State Land Ceiling Act stood repealed, as a result of which none of its provisions could be used in order to hit the agreement in the present case.
It was argued that the appellant-plaintiff had been ready and willing throughout to perform its part of the agreement, whereas the defendants were correctly found to be in breach, neither of which findings had been set aside by the Division Bench.
It was stated that the fact that the appellant could not have purchased more than area ceiling limit prescribed under State Land Ceiling Act, the same would not render the agreement null and void ab initio, but on the contrary, would be at the risk of the appellant, as correctly held by the learned Single Judge.
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Suit for specific performance filed within limitation cannot be dismissed on sole ground of delay or laches
The Hon’ble Supreme Court stated that on the date on which the appellate decree was passed, in any case, the State Urban Land Ceiling Act having been repealed would not stand in the way of a decree for specific performance. There was no vested right under the State Urban Land Ceiling Act in favour of the defendants.
The Hon’ble Supreme Court said that Courts have uniformly held that the mere escalation of land prices after the date of the filing of the suit cannot be the sole ground to deny specific performance. Also, the settled law is that mere delay by itself, without more, cannot be the sole factor to deny specific performance.
The Hon’ble Supreme Court stated that once a suit for specific performance has been filed, any delay as a result of the court process cannot be put against the plaintiff as a matter of law in decreeing specific performance. However, it is within the discretion of the Court, regard being had to the facts of each case, as to whether some additional amount ought or ought not to be paid by the plaintiff once a decree of specific performance is passed in its favour, even at the appellate stage.
The Hon’ble Supreme Court set aside the judgment of the Division Bench and the decree passed by the Single Judge in favour of the appellants was restored.
