2002 (5) TMI 881 - SC - Indian Laws

Summary

Issues Involved:
1. Entitlement to specific performance of the agreement.
2. Requirement to pay an additional sum of Rs. 40 lakhs.
3. Applicability of Section 20 of the Specific Relief Act, 1963.
4. Delay in granting specific performance and escalation of prices.
5. Readiness and willingness of the appellant to perform the contract.
6. Equitable considerations and compensation.

Issue-wise Detailed Analysis:

1. Entitlement to Specific Performance of the Agreement:
The judgment confirms that the 4th plaintiff-appellant is entitled to the specific performance of the agreement dated 8.9.1966 for the sale of Flat No. 71 on the 7th floor of "Divya Prabha" building. The court found that the appellant had always been ready and willing to perform her part of the agreement, and it was the defendants who breached the contract. The trial court and appellate court had already recorded findings to this effect.

2. Requirement to Pay an Additional Sum of Rs. 40 Lakhs:
The court disagreed with the imposition of an additional Rs. 40 lakhs as a condition precedent for the execution of the sale deed. The appellant was found entitled to the sale deed on payment of the sum mentioned in the agreement to sell, plus any additional amounts required under terms (iv) and the first portion of term (v) for the completion of the building, if the appellant agrees to get the building completed from the 7th respondent at prevailing market rates.

3. Applicability of Section 20 of the Specific Relief Act, 1963:
Section 20 provides that the relief of specific performance is discretionary and not a matter of right. The court must exercise this discretion in a sound and reasonable manner guided by judicial principles. The circumstances in which the court may refuse specific performance are enumerated in sub-sections (2) and (3), but these are not exhaustive.

4. Delay in Granting Specific Performance and Escalation of Prices:
The court acknowledged that delay or escalation of prices alone is not a ground to deny specific performance. However, under certain circumstances, courts have directed the vendee to pay additional compensatory amounts to mitigate hardship to the vendor. This principle is not universally applicable and depends on the facts and circumstances of each case.

5. Readiness and Willingness of the Appellant to Perform the Contract:
Both the trial court and appellate court found that the appellant was ready and willing to perform her part of the agreement at all times. The appellant promptly sought specific performance and was not responsible for any delay. The respondents, on the other hand, were found to be trying to wriggle out of the contract.

6. Equitable Considerations and Compensation:
The court discussed previous cases where additional compensation was awarded to the vendor due to escalation in property prices. However, it was noted that such compensation is not an absolute rule and depends on the specific facts of each case. In this case, the appellant had not taken any undue advantage, and requiring her to pay an additional Rs. 40 lakhs would be unfair and potentially frustrate the agreement.

Conclusion:
The appellant is entitled to the specific performance of the agreement to sell Flat No. 71 on the 7th floor of "Divya Prabha" building at the price mentioned in the agreement, subject to terms (iii), (iv), (v), and (vi) of the judgment. There is no order as to costs.