# MADHUKAR NIVRUTTI JAGTAP & ORS v. SMT. PRAMILABAI CHANDULAL PARANDEKAR & ORS

- **Citation:** [2019] 10 S.C.R. 31
- **Court:** Supreme Court of India
- **Decided:** 2019-08-13
- **Case number:** Civil Appeal No. 5382 of 2007
- **Bench:** Abhay Manohar Sapre, Dinesh Maheshwari
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/madhukar-nivrutti-jagtap-ors-v-smt-pramilabai-chandulal-parandekar-ors-32971
- **Pages:** 42

## Headnote

Specific Relief Act, 1963: Nature of transaction between the
plaintiffs and defendant nos.1 to 3 - Suit for specific performance
of agreements for sale of agricultural land and in the alternative
for recovery of earnest money with interest - Case of plaintiffs was
that defendant 1 to 3 had executed agreement dated 20.9.1965 for
sale of suit land for a consideration of Rs.22,951 and that Rs.3,500
was paid as earnest money; that plaintiffs further paid Rs.2,000 on
24.9.1965 and took possession of 25 acres of land - Plaintiff further
averred that defendants executed a supplementary agreement for
sale and accepted an additional sum of Rs.500 from plaintiffs and
handed over the remaining portion of land to plaintiffs and the
remaining sale consideration was settled at Rs.11,951 after deducting
Rs.5,000 towards encumbrances and on payment of this amount
defendants 1 to 3 were liable to execute the sale deed in their favour
- Case of defendants 1 to 3 (vendors) was that the said agreements
were executed only as collateral security for a loan advanced by
plaintiff no.1 and not for sale of property - Held: There was not
even a remote suggestion in the agreements that there was any loan
or borrowing transaction between the parties and the said
agreements were being executing towards security - On the contrary,
the recitals and stipulations in the agreements were only in
affirmation of the agreement for sale and of the receipt of part
payment from time to time against the sale consideration - As to
whether the possession of the land in question was delivered to the
plaintiffs or not, could not have been taken as a factor decisive as
regards nature of transaction - Moreover, execution of the
supplementary agreement after notice and after receiving further
an amount of Rs. 500/- by defendant Nos. 1 to 3 could only show
 [2019] 10 S.C.R. 31
31
A
B
C
D
E
F
G
H
32
SUPREME COURT REPORTS
[2019] 10 S.C.R.
re-affirmation of the intention of the parties towards the sale
transaction - In the supplementary agreement, the defendants not
only acknowledged the receipt of part consideration to the tune of
Rs. 6,000/- but further agreed for adjustment of Rs. 5,000/- towards
encumbrances and, therefore, agreed to receive remaining Rs.
11,921/- at the time of execution of the sale deed - In view of the
dealings of the parties, this circumstance about execution of the
supplementary agreement only strengthened the case of the plaintiffs.
Specific Relief Act, 1963: Specific performance - Readiness
and willingness of plaintiff to perform his part of the contract -
The plaintiffs pleaded in the plaint that they were ready to get the
sale deed executed as per the conditions in the agreement for sale
and also stated that they served the notice, then supplementary
agreement was executed; and then, on many occasions, they asked
the defendant to execute the sale deed - Defendant No.1 in his
written statement merely stated a bald denial that such averments
were false and were 'not agreeable to the defendants' - The entire
emphasis of the written statement was on the assertion that the
agreement in question was not for sale and was obtained by the
plaintiffs towards security against the amount borrowed by defendant
No.1 - Held: The plea of the plaintiffs as regards their readiness to
perform the contract as per its conditions did not meet with
categorical denial from the defendants - This apart, even at the
time of entering into the agreement, the plaintiffs paid Rs. 3,500/-
against the sale consideration of Rs. 22,951/- - Moreover, and much
before the stipulated date of execution of sale deed, they made
another payment of Rs. 2,000/- against the sale consideration -
When the sale deed was not executed within stipulated time, the
plaintiffs served notice - Defendants thereafter executed the
supplementary agreement and the plaintiffs made payment of yet
another sum of Rs. 500/- while it was also agreed by the vendors
that the property carried encumbrance to the tune

## Text

_Characters 0–39,827 of 99,164. This is a partial read: ask again with offset=39827 for what follows._

A
B
C
D
E
F
G
H
31
MADHUKAR NIVRUTTI JAGTAP & ORS.
v.
SMT. PRAMILABAI CHANDULAL PARANDEKAR & ORS.
(Civil Appeal No. 5382 of 2007)
AUGUST 13, 2019
[ABHAY MANOHAR SAPRE AND
DINESH MAHESHWARI, JJ.]
Specific Relief Act, 1963: Nature of transaction between the
plaintiffs and defendant nos.1 to 3 - Suit for specific performance
of agreements for sale of agricultural land and in the alternative
for recovery of earnest money with interest - Case of plaintiffs was
that defendant 1 to 3 had executed agreement dated 20.9.1965 for
sale of suit land for a consideration of Rs.22,951 and that Rs.3,500
was paid as earnest money; that plaintiffs further paid Rs.2,000 on
24.9.1965 and took possession of 25 acres of land - Plaintiff further
averred that defendants executed a supplementary agreement for
sale and accepted an additional sum of Rs.500 from plaintiffs and
handed over the remaining portion of land to plaintiffs and the
remaining sale consideration was settled at Rs.11,951 after deducting
Rs.5,000 towards encumbrances and on payment of this amount
defendants 1 to 3 were liable to execute the sale deed in their favour
- Case of defendants 1 to 3 (vendors) was that the said agreements
were executed only as collateral security for a loan advanced by
plaintiff no.1 and not for sale of property - Held: There was not
even a remote suggestion in the agreements that there was any loan
or borrowing transaction between the parties and the said
agreements were being executing towards security - On the contrary,
the recitals and stipulations in the agreements were only in
affirmation of the agreement for sale and of the receipt of part
payment from time to time against the sale consideration - As to
whether the possession of the land in question was delivered to the
plaintiffs or not, could not have been taken as a factor decisive as
regards nature of transaction - Moreover, execution of the
supplementary agreement after notice and after receiving further
an amount of Rs. 500/- by defendant Nos. 1 to 3 could only show
 [2019] 10 S.C.R. 31
31
A
B
C
D
E
F
G
H
32
SUPREME COURT REPORTS
[2019] 10 S.C.R.
re-affirmation of the intention of the parties towards the sale
transaction - In the supplementary agreement, the defendants not
only acknowledged the receipt of part consideration to the tune of
Rs. 6,000/- but further agreed for adjustment of Rs. 5,000/- towards
encumbrances and, therefore, agreed to receive remaining Rs.
11,921/- at the time of execution of the sale deed - In view of the
dealings of the parties, this circumstance about execution of the
supplementary agreement only strengthened the case of the plaintiffs.
Specific Relief Act, 1963: Specific performance - Readiness
and willingness of plaintiff to perform his part of the contract -
The plaintiffs pleaded in the plaint that they were ready to get the
sale deed executed as per the conditions in the agreement for sale
and also stated that they served the notice, then supplementary
agreement was executed; and then, on many occasions, they asked
the defendant to execute the sale deed - Defendant No.1 in his
written statement merely stated a bald denial that such averments
were false and were 'not agreeable to the defendants' - The entire
emphasis of the written statement was on the assertion that the
agreement in question was not for sale and was obtained by the
plaintiffs towards security against the amount borrowed by defendant
No.1 - Held: The plea of the plaintiffs as regards their readiness to
perform the contract as per its conditions did not meet with
categorical denial from the defendants - This apart, even at the
time of entering into the agreement, the plaintiffs paid Rs. 3,500/-
against the sale consideration of Rs. 22,951/- - Moreover, and much
before the stipulated date of execution of sale deed, they made
another payment of Rs. 2,000/- against the sale consideration -
When the sale deed was not executed within stipulated time, the
plaintiffs served notice - Defendants thereafter executed the
supplementary agreement and the plaintiffs made payment of yet
another sum of Rs. 500/- while it was also agreed by the vendors
that the property carried encumbrance to the tune of Rs. 5,000/-,
which was to be adjusted against the sale consideration - Therefore,
the plaintiffs were left to make payment of about half of the sale
consideration - The plaintiffs showed their readiness and willingness
to perform their part of the contract and there did not operate any
personal bar against their claim for specific performance.
A
B
C
D
E
F
G
H
33
Transfer of Property Act, 1882: s.52 - Doctrine of lis
pendens - Both the sale transactions in favour of the appellants,
purporting to transfer the suit property in part, having been effected
after filing of the suit, were directly hit by the doctrine of lis pendens,
as embodied in s.52 of the Act, 1882 - Specific Relief Act, 1963.
Transfer of Property Act, 1882: s.52 - Effect of doctrine of
lis pendens - Held: Is not to annul all the transfers effected by the
parties to a suit but only to render them subservient to the rights of
the parties under the decree or order which may be made in that
suit - Its effect is only to make the decree passed in the suit binding
on the transferee, i.e., the subsequent purchaser - Nevertheless,
the transfer remains valid subject, of course, to the result of the
suit - Hence, the effect of s.52, for the purpose of the instant case
would only be that the said sale transactions in favour of the
subsequent purchasers shall have no adverse effect on the rights
of the plaintiffs and shall remain subject to the final outcome of the
suit in question - However, the High Court, while holding that the
said transactions were hit by lis pendens, proceeded to observe
further that the sale deeds so made in favour of the subsequent
purchasers were illegal - These observations by the High Court not
approved.
Specific Relief Act, 1963: Requirement to prove readiness and
willingness of plaintiff to perform his part of the contract is not that
the plaintiff should continuously approach the defendant with
payment or make incessant requests for performance - For the relief
of specific performance, which is essentially a species of equity but
has got statutory recognition in terms of the Specific Relief Act, the
plaintiff must be found standing with the contract and the plaintiff's
conduct should not be carrying any such blameworthiness so as to
be considered inequitable.
Specific Relief Act, 1963: Limitation - When the plaintiffs
had the limitation of three years for filing the suit for specific
performance, it cannot be said that during the said period, the
plaintiffs are required to show overt act by them in furtherance of
the agreement in question - In the instant case, when the plaintiffs
had the limitation of three years for filing the suit and have indeed
filed the suit well within limitation, no aspect of delay operates
against them -Limitation - Delay/Latches.
MADHUKAR NIVRUTTI JAGTAP v. SMT. PRAMILABAI
CHANDULAL PARANDEKAR
A
B
C
D
E
F
G
H
34
SUPREME COURT REPORTS
[2019] 10 S.C.R.
Specific Relief Act, 1963: ss.21 and 22 - Grant of relief -
Agreements in question were executed way back on 20.09.1965 and
28.04.1966 - The evidence on record showed that vendors and
thereafter, the subsequent purchasers remained in effective
possession thereof - High Court took note of the fact that as on the
date of its decision, the subsequent purchasers were in possession
of the land in question for about 40 years - High Court found that
land in question carried much higher valuation at the time of passing
of the judgment in second appeal and hence, enhanced the sale
consideration to Rs. 10,000/- per acre - Plaintiffs, even while seeking
specific performance, prayed for the alternative reliefs of recovery
of amount paid by them with interest and compensation to the tune
of Rs 15,000/- - Plaintiff No. 1 expired during the pendency of suit
and plaintiff No. 2 expired during the pendency of this appeal;
though legal representative of plaintiff Nos. 1 and 2 was on record
as plaintiff No.4 (respondent No. 2) - Plaintiff No.2, while deposing
as PW2 had stated that in case specific performance was not
granted, she 'may be granted alternative relief and compensation
with interest' - In view of this, instead of specific performance,
awarding of monetary compensation to respondent No. 2 would
meet the ends of justice - Subsequent purchasers themselves filed
valuation report suggesting that the market value of unirrigated
land was Rs. 70,000/- per hectare whereas that of the irrigated
land was Rs. 1,40,000/- per hectare - The fact also remained that
the appellants have been enjoying the land in question for a long
length of time - Further, the predecessors of respondent No. 2 made
payment of the sum of Rs. 6,000/- to the vendors in the years 19651966; and the plaintiffs had claimed alternative relief of recovery
of the said amount together with interest as also of compensation -
Taking all the relevant factors into account, a lump sum of Rs.
15,00,000/- is awarded to respondent No. 2 as compensation in
lieu of specific performance - Equity.
Partly allowing the appeal, the Court
HELD: 1. Nature of transaction between the plaintiffs and
defendant Nos. 1 to 3
1.1 There had not been even a remote suggestion in the
documents in question that there was any loan or borrowing
transaction between the parties and the said documents were
A
B
C
D
E
F
G
H
35
being executing towards security. On the contrary, the recitals
and stipulations in the said agreements had only been in affirmation
of the agreement for sale and of the receipt of part payment from
time to time against the sale consideration. The subordinate
Courts proceeded to doubt if the transaction was at all intended
to be of sale while questioning as to why the parties fixed the
consideration in odd figures i.e., Rs. 22,951/-; and while observing
that when as per the documents, the land was being sold @ Rs.
450/- per acre, the total consideration for the land in question
would come to Rs. 22,938.75 and not Rs. 22,951/-. The Trial
Court also raised doubts on the suggestion of the plaintiffs that
possession of the land in question was handed over to them. The
First Appellate Court even observed that as against the sale
consideration, only a paltry amount was paid in advance and
questioned as to why the supplementary agreement was executed
after serving of notice. On the other hand, the High Court
minutely examined the evidence on record and observed that
there was not even a whisper about the loan transaction; and that
as per the endorsement made on 24.11.1965, another amount of
Rs. 2,000/- was received by defendant Nos. 1 to 3. As regards
the supplementary agreement dated 28.04.1966, the High Court
again found that there was no whisper about any loan transaction
or any security for such a transaction and the document was clearly
executed as being the supplementary agreement for sale while
even referring to the encumbrances of Rs. 5,000/-, which were
to be discharged. The High Court observed that by no stretch of
imagination these two agreements could be termed as and by
way of security for a loan. Trial Court and First Appellate Court
proceeded on entirely irrelevant and rather baseless
considerations while failing to consider that such findings on the
nature of transaction evidenced by the agreements in question
could not have been rendered on surmises and conjectures. [Paras
12.2, 12.3, 12.4][59-C-D; F-H; 60-A-C, D]
1.2 As to whether the possession of the land in question
was delivered to the plaintiffs or not, could not have been taken
as a factor decisive as regards nature of transaction. Moreover,
execution of the supplementary agreement after notice dated
05.04.1966 and after receiving further an amount of Rs. 500/- by
MADHUKAR NIVRUTTI JAGTAP v. SMT. PRAMILABAI
CHANDULAL PARANDEKAR
A
B
C
D
E
F
G
H
36
SUPREME COURT REPORTS
[2019] 10 S.C.R.
the defendant Nos. 1 to 3 could only show re-affirmation of the
intention of the parties towards the sale transaction. In the
supplementary agreement, the defendants not only acknowledged
the receipt of part consideration to the tune of Rs. 6,000/- but
further agreed for adjustment of Rs. 5,000/- towards
encumbrances and, therefore, agreed to receive remaining Rs.
11,921/- at the time of execution of the sale deed. In view of the
dealings of the parties, this circumstance about execution of the
supplementary agreement only strengthened the case of the
plaintiffs rather than operating against them. [Para 12.4.1]
[60-E-G]
1.3 The other observations of the subordinate Courts as
regards quantum of consideration is also not convincing. Such
hair-splitting exercise by the Trial Court, that on the agreed rate,
sale consideration ought to have been Rs. 22,938.75 and as to
why the parties agreed for Rs. 22,951/-, had been entirely
baseless, rather unwarranted. The observation of the Trial Court
as to why the sale consideration was in odd figures is itself of
such oddity that any finding on that basis could only meet with
disapproval. Rounding up of the amount of consideration and
addition of one rupee in the last is not unknown to such
transactions. In fact, quite contrary to what was observed by the
Trial Court, the figure of sale consideration rather fortifies the
deduction that the intention of the parties had only been towards
the transaction of sale. [Para 12.4.2] [60-G-H; 61-A]
2. Readiness and willingness of the plaintiffs to perform
their part of contract
2.1 The requirement to prove readiness and willingness of
plaintiff to perform his part of the contract is not that the plaintiff
should continuously approach the defendant with payment or
make incessant requests for performance. For the relief of specific
performance, which is essentially a species of equity but has got
statutory recognition in terms of the Specific Relief Act, 1963,
the plaintiff must be found standing with the contract and the
plaintiff's conduct should not be carrying any such blame
worthiness so as to be considered inequitable. [Para 13.2]
[62-D-F]
A
B
C
D
E
F
G
H
37
2.2 The plaintiffs pleaded in the plaint that they were ready
to get the sale deed executed as per the conditions in the
agreement for sale and also stated that they served the notice,
then supplementary agreement was executed; and then, on many
occasions, they asked the defendant to execute the sale deed.
The defendant No. 1 in his written statement merely stated a
bald denial that such averments were false and were 'not agreeable
to the defendants'. In fact, the entire emphasis of the written
statement had been on the assertion that the agreement in
question was not for sale and was obtained by the plaintiffs towards
security against the amount borrowed by defendant No. 1. The
plea of the plaintiffs as regards their readiness to perform the
contract as per its conditions did not meet with categorical denial
from the defendants. This apart, even at the time of entering into
the agreement, the plaintiffs made payment of a sum of Rs. 3,500/
- against the sale consideration of Rs. 22,951/-. Moreover, and
much before the stipulated date of execution of sale deed, they
made another payment of Rs. 2,000/- against the sale
consideration. When the sale deed was not executed by
23.03.1966, the plaintiffs served notice on 05.04.1966. The
vendors thereafter executed the supplementary agreement and
the plaintiffs made payment of yet another sum of Rs. 500/- while
it was also agreed by the vendors that the property carried
encumbrance to the tune of Rs. 5,000/-, which was to be adjusted
against the sale consideration. Therefore, the plaintiffs were left
to make payment of about half of the sale consideration. The
recitals in the supplementary agreement even suggested about
the vendors having delivered possession of the property in
question. [Para 13.3] [62-G-H; 63-A-E]
2.3 The admission of plaintiff No. 3 that she was not
possessed of sufficient funds cannot be read in isolation and it
cannot be concluded that she was not possessed of sufficient
means to pay the remaining sale consideration. Her statement is
required to be visualised in the backdrop of the fact that her
husband, plaintiff No. 1, had expired and she had succeeded to
his estate. Her statement, with reference to her understanding
of the matter, could only be interpreted to mean that at the given
moment, she was not off-hand in possession of the money to make
MADHUKAR NIVRUTTI JAGTAP v. SMT. PRAMILABAI
CHANDULAL PARANDEKAR
A
B
C
D
E
F
G
H
38
SUPREME COURT REPORTS
[2019] 10 S.C.R.
payment but such an expression in her statement cannot lead to
the conclusion that making payment of the remaining sale
consideration was beyond her capacity or that she was not willing
to perform her part of the contract. The question of readiness
and willingness on the part of the plaintiffs was approached by
the First Appellate Court from an altogether wrong angle and
was decided against the plaintiffs on irrelevant considerations.
[Para 13.4] [63-F-H; 64-A]
2.4 So far the period between 1966 to 1968 is concerned,
when the plaintiffs had the limitation of three years for filing the
suit for specific performance, it cannot be said that during the
aforesaid period, the plaintiffs were required to show overt act
by them in furtherance of the agreement in question. In this case
too, when the plaintiffs had the limitation of three years for filing
the suit and have indeed filed the suit well within limitation; and
looking to the overall circumstances of the case, no aspect of
delay operates against them. The plaintiffs have shown their
readiness and willingness to perform their part of the contract
and there does not operate any personal bar against their claim
for specific performance. [Paras 13.5-13.7] [64-B; 65-D-E]
R Lakshmikantham v. Devaraji (2019) 8 SCC 62
- relied on.
Azhar Sultana v. B. Rajamani and Ors. (2009) 17 SCC
27 : [2009] 2 SCR 537 - distinguished.
3. Operation of the doctrine of lis pendens : Section 52
T.P. Act
3.1 The suit in question was filed on 26.08.1968. So far the
sale transaction in favour of the defendant Nos. 4 & 5 (appellant
Nos. 1 & 2), in relation to 25 acres of land out of the suit property,
is concerned, the same was effected by way a sale deed registered
only on 10.07.1978 i.e., nearly 10 years after filing of the suit. So
far the sale transaction in favour of the defendant No. 6 (appellant
No. 3), in relation to other 25 acres of land out of the suit property,
is concerned, though it is suggested that there had been an
agreement (dated 08.05.1968) in his favour before filing of the
A
B
C
D
E
F
G
H
39
suit but then, admittedly, the sale transaction was effected by
way of a sale deed registered only on 18.09.1968, that had also
been after filing of the suit. The suggestion about want of
knowledge of the subsequent purchasers about the transaction
of the vendors with the plaintiffs and about the pendency of the
suit has been considered and rejected by the High Court and
even by the subordinate Court after due appreciation of evidence
on record; and there is no nfirmity in these findings. Both the
sale transactions in favour of the appellants, purporting to transfer
the suit property in part, having been effected after filing of the
suit, are directly hit by the doctrine of lis pendens, as embodied
in Section 52 of the Transfer of Property Act, 1882. [Para 14.1]
[65-G-H; 66-A-CE]
3.2 The effect of doctrine of lis pendens is not to annul all
the transfers effected by the parties to a suit but only to render
them subservient to the rights of the parties under the decree or
order which may be made in that suit. Hence, the effect of Section
52 for the purpose of the present case would only be that the said
sale transactions in favour of the appellants shall have no adverse
effect on the rights of the plaintiffs and shall remain subject to
the final outcome of the suit in question. However, the High
Court, while holding that the said transactions were hit by lis
pendens, has proceeded to observe further that the sale deeds
so made in favour of the appellants were illegal. These further
observations by the High Court cannot be approved. [Paras 14.3,
14.4] [67-H; 68-A-B]
4. What should be the relief?
4.1 The High Court though proceeded to mould the relief
in the manner that specific performance was granted on enhanced
sale consideration and it was also directed that if the plaintiffs fail
to make payment within two months, the appellants (subsequent
purchasers) would make payment of same amount to the plaintiffs
so as to 'confirm their ownership over the suit land'. However,
after it was found that granting the decree for specific performance
in the very terms of the agreement/s in question may not be
appropriate because of myriad factors, the matter ought to have
been examined with reference to the stand of the parties and the
MADHUKAR NIVRUTTI JAGTAP v. SMT. PRAMILABAI
CHANDULAL PARANDEKAR
A
B
C
D
E
F
G
H
40
SUPREME COURT REPORTS
[2019] 10 S.C.R.
provisions of Sections 21 and 22 of the Act of 1963. [Paras 16,
16.1, 16.2] [68-G-H; 69-A-B]
4.2 Some of the relevant factors having bearing on the
question of appropriate relief in this matter. First, the agreements
in question were executed way back in 1965 and 1966. Secondly,
the plaintiffs had paid Rs. 6,000/- as on 28.04.1966 against the
sale consideration of Rs. 22,951/- when the supplementary
agreement was executed. Thirdly, though the plaintiffs alleged
delivery of possession of the land in question to them, the
evidence shows that vendors and thereafter, the subsequent
purchasers remained in effective possession thereof. Fourthly,
the High Court took note of the fact that as on the date of its
decision, the subsequent purchasers were in possession of the
land in question for about 40 years. Fifthly, the High Court found
that the land in question carried much higher valuation at the
time of passing of the judgment in second appeal and hence,
enhanced the sale consideration to Rs. 10,000/- per acre. Sixthly,
the plaintiffs, even while seeking specific performance,
consciously prayed for the alternative reliefs of recovery of amount
paid by them with interest and compensation to the tune of Rs
15,000/-. Seventhly, plaintiff No. 3 had categorically deposed
before the Court as PW1 that he was not entitled to the land in
question for being not an agriculturist and he had relinquished
his rights in favour of the plaintiff Nos. 1 & 2. Eighthly, the plaintiff
No. 1 had expired during the pendency of suit and the plaintiff
No. 2 had expired during the pendency of this appeal; though the
heir and legal representative of the said plaintiff Nos. 1 & 2 is on
record as plaintiff No. 4 (respondent No. 2). Ninthly, the plaintiff
No. 2, while deposing as PW2 had stated that in case specific
performance was not granted, she 'may be granted alternative
relief and compensation with interest'. In view of this, instead of
specific performance, awarding of monetary compensation to
respondent No.2 shall meet the ends of justice. Taking all the
relevant factors into account, a lump sum of Rs. 15,00,000/- is
awarded to respondent No. 2 as compensation in lieu of specific
performance. [Paras 16.3, 17] [70-F-H; 71-A-G]
A
B
C
D
E
F
G
H
41
Umabai and another v. Nilkanth Dhondiba Chavan
(Dead) by LRS. and another (2005) 6 SCC 243 : [2005]
3 SCR 521 ; Sarvinder Singh v. Dalip Singh and Ors.
(1996) 5 SCC 539 : [1996] 4 Suppl. SCR 271 ; Veerayee
Ammal v. Seeni Ammal (2002) 1 SCC 134 : [2012] 6
SCR 369 ; Pushparani S. Sundaram and Ors. v. Pauline
Manomani James (deceased) and Ors. (2002) 9 SCC
582 ; A. Nawab John and Ors. v. V. N. Subramaniyam
(2012) 7 SCC 738 : [2012] 6 SCR 369 ; V. Muthusami
(Dead) by LRs. v. Angammal and Ors. (2002) 3 SCC
316 : [2002] 2 SCR 37 ; Guruswamy Nadar v. P. Lakshi
Ammal (Dead) through LRs and Ors. (2008) 5 SCC
796 : [2008] 7 SCR 435 - referred to.
Case Law Reference
[2005] 3 SCR 521
referred to
Para 7.1
[1996] 4 Suppl. SCR 271
referred to
Para 7.3
[2009] 2 SCR 537
distinguished
Para 8.1
[2012] 6 SCR 369
referred to
Para 8.1
(2002) 9 SCC 582
referred to
Para 8.1
[2012] 6 SCR 369
referred to
Para 8.2
[2002] 2 SCR 37
referred to
Para 8.2
[2008] 7 SCR 435
referred to
Para 10
(2019) 8 SCC 62
relied on
Para 13
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5382
of 2007.
From the final Judgment and Order dated 01.08.2007 of the High
Court of Judicature at Bombay in Second Appeal No.176 of 1988.
K. Parameshwar, Shivaji M. Jadhav, M. V. Mukunda, Ms. Ashtha
Deep, Advs. for the Appellants.
Subrat Birla, S.C. Birla, Advs. for the Respondents.
MADHUKAR NIVRUTTI JAGTAP v. SMT. PRAMILABAI
CHANDULAL PARANDEKAR
A
B
C
D
E
F
G
H
42
SUPREME COURT REPORTS
[2019] 10 S.C.R.
The Judgment of the Court was delivered by
DINESH MAHESHWARI, J.
1. This appeal by special leave arises out of a civil suit (No. 83 of
1968) for specific performance of agreement for sale of agricultural
land in Survey No. 64 admeasuring 50 acres and 39 gunthas, situated at
village Gulvanchi, Taluka - North Solapur1. In its judgment and decree
dated 13.04.1984, the Trial Court declined the relief of specific
performance but decreed the suit for the alternative relief of money
recovery. On 30.11.1987, the First Appellate Court, while dismissing the
contesting plaintiffs' appeal (Civil Appeal No. 546 of 1984), affirmed the
decree of the Trial Court. However, the High Court of Judicature at
Bombay allowed the second appeal preferred by the contesting plaintiffs
(Second Appeal No. 176 of 1988) by its impugned judgment and decree
dated 01.08.2007 and decreed the suit for the principal relief of specific
performance, albeit on enhanced sale consideration with reference to
the market value of the land in question.
2. In order to appreciate the relevant features of this case,
essentially pertaining to the reliefs claimed under the Specific Relief
Act, 19632, the status and capacity of parties to this litigation may be
taken note of at the outset and as follows: -
2.1. In the suit for specific performance leading to this appeal, the
respondent No. 1 and the respondent No. 6 had been the plaintiff Nos. 2
and 3 respectively. The suit was filed by them jointly with the plaintiff
No. 1- late Shri Chandulal Balaprasad Parandekar, who was the husband
of plaintiff No. 2 (respondent No. 1 herein) and who expired during the
pendency of suit. After the demise of plaintiff No. 1, the daughter of
plaintiff Nos. 1 and 2 was taken on record as plaintiff No. 4. She is
respondent No. 2 in this appeal. Therefore, respondent Nos. 1, 2 and 6
of this appeal were standing in the capacity of plaintiffs (vendees).
2.2. On the other hand, the respondent Nos. 3 to 5 of this appeal
had been the original defendant Nos. 1 to 3 in the suit in question. The
defendant No. 1 (respondent No. 3) having expired, his legal
representatives are joined as respondent Nos. 3a to 3d in this appeal.
The agreements forming the subject-matter of this litigation were
1 Hereinafter referred to as 'the suit property' or 'the land in question'.
2 Hereinafter also referred to as 'the Act of 1963'.
A
B
C
D
E
F
G
H
43
executed by the defendant Nos. 1 to 3 (vendors) in favour of the plaintiff
Nos. 1 to 3 (vendees).
2.3 The appellants of this appeal were subsequently joined as
defendant Nos. 4 to 6 in the suit in question, as being the purchasers of
the suit property after filing of the suit.3
2.4. It may also be noticed that an application (IA No. 3 of 2010)
was moved in this appeal pointing out demise of respondent No. 1 (plaintiff
No. 2), respondent No. 4 (defendant No. 2), and respondent No. 6
(plaintiff No. 3) with the submissions that the legal representative of the
respondent No. 1 was already on record as respondent No. 2; and the
legal representatives of deceased respondent Nos. 4 and 6 may be
substituted on record. However, this application was rejected on
24.02.2012. On the other hand, other applications (IA Nos. 5 & 6 of
2013) for substitution of legal representatives of deceased respondent
No. 5 (defendant No. 3) and for condonation of delay were granted on
05.08.2013. Be that as it may, the estate of the original contesting plaintiffs
(plaintiffs Nos. 1 & 2) is duly represented by their daughter (plaintiff
No. 4 - respondent No. 2 herein); and the contest in this litigation is
essentially between her and the appellants (subsequent purchasers).
3. Briefly put, the relevant background aspects of the matter and
respective stands of the parties had been as follows: -
3.1. The plaintiffs filed the suit aforesaid with the averments that
the defendant Nos. 1 to 3 had executed an agreement dated 20.09.1965
for sale of the suit property for a consideration of Rs. 22,951/-; and that
a sum of Rs. 3,500/- was paid as earnest money. It was further averred
that crops were standing on the suit property and hence, possession to
the extent of half portion thereof was to be handed over by the end of
the year of 1965; and that in part performance of agreement, the plaintiffs
made payment of a further sum of Rs. 2,000/- to the defendant Nos. 1 to
3 on 24.09.1965 and the said defendants handed over possession of 25
acres of the land in question to the plaintiffs on 14.11.1965. The plaintiffs
further averred that they served a notice on the defendant Nos. 1 to 3 on
05.04.1966 for performance of the agreement in question and, on receipt
of this notice, the said defendants executed a supplementary agreement
for sale; they accepted an additional amount of Rs. 500/- from the
3 As far as feasible, the parties have been referred in this judgment as per their status in
the suit.
MADHUKAR NIVRUTTI JAGTAP v. SMT. PRAMILABAI
CHANDULAL PARANDEKAR [DINESH MAHESHWARI, J.]
A
B
C
D
E
F
G
H
44
SUPREME COURT REPORTS
[2019] 10 S.C.R.
plaintiffs; and they handed over possession of the remaining part of the
land in question to the plaintiffs. The plaintiffs also averred that in this
manner, a sum of Rs. 6,000/- was paid to the defendant Nos. 1 to 3 as
part payment of the total sale consideration and the remaining sale
consideration was settled at Rs. 11,951/-, after deducting Rs. 5,000/-
towards encumbrances; and on payment of this amount, the defendant
Nos. 1 to 3 were liable to execute the sale deed in their favour within a
time span of 15 days. The plaintiffs averred that they were ready to
perform their part of the contract but the defendant Nos. 1 to 3 failed to
execute the sale deed for the land in question. With these averments, the
plaintiffs sought the relief of specific performance of the agreement for
sale and in the alternative, also prayed for recovery of earnest money
with interest and for damages. The reliefs claimed in the plaint, being
relevant for present purposes, may be take note of as follows: -
"10) The Plaintiffs pray that,
A) The Defendants may be ordered to execute the sale-deed
in respect of the land described in plaint paragraph 1, by
accepting Rs.16,951/- from the plaintiffs and to mention in
the sale-deed that, in case, the Defendants can not ward off
the charges on the land, being the sum of Rs. 5,000/-, before
the execution of the sale-deed then the said amount may be
deducted from the sale price and the plaintiffs shall obtain
assurance for the same and the defendant Nos. 1 to 6 may be
ordered to join the defendant No.1 to 3, in execution of the
sale-deed.
B) If it is proved that, perhaps the possession of the land
received by the Plaintiffs by way of part performance, is taken
by the Defendants and the possession is of the Defendants
only, then the Defendants may be ordered to hand over the
land.
C) In case, if it happens that, for any reason sale-deed
pertaining to the suit land can not be executed in favour of
the plaintiffs, then the defendants may be ordered to pay to
the plaintiffs the sum accepted by the defendants towards the
earnest money Rupees 6,000/- and damages thereon at the
rate of Rs. 2% p.a. And the sum of Rupees 15,000/- towards
the losses on account of breach of Agreement by the
A
B
C
D
E
F
G
H
45
Defendants and it may also be ordered that the encumbrances
in respect of the said amount has been placed on the suit
land.
D) The Defendants may be ordered to pay to the plaintiffs the
entire cost, including advocates fee, of the present suit.
E) Other just and proper orders may be passed."
3.2. In their written statement, the defendant Nos. 1 to 3 (vendors)
though admitted the execution of agreement dated 20.09.1965 as also
supplementary agreement dated 28.04.1966 but then, claimed that the
said agreements were executed only as collateral security for a loan
advanced by the plaintiff No. 1 and not for the sale of property. These
defendants asserted that the plaintiff No. 3 had introduced them to the
plaintiff Nos. 1 and 2, who in turn, had advanced the loan to them. They
further asserted that though the agreement was originally executed only
in favour of plaintiff No. 1, the names of other plaintiffs were incorporated
at the behest of plaintiff No.3; and that they had never parted with
possession of the land in question.
3.3. The defendant Nos. 4 and 5 were subsequently impleaded in
the said suit as they had purchased 25 acres of the land in question by
way of a sale deed dated 10.07.1978, which was executed by the
defendant No. 1. The defendant No. 6 was also impleaded as a subsequent
purchaser of the remaining portion of the land in question, by way of
another sale deed dated 18.09.1968. These defendants contended that
they were bona fide purchasers having no knowledge of the
aforementioned transaction between the plaintiffs and defendant Nos. 1
to 3.
4. On completion of pleadings of parties, the Trial Court framed
as many as 20 issues for determination of the questions involved in the
matter. After taking the evidence and having heard the parties, the Trial
Court proceeded to dismiss the suit for specific performance while
recording the basic finding to the effect that the documents in question
(the alleged agreement for sale as also the supplementary agreement)
were, in fact, executed as security for loan and not for sale of the suit
property to the plaintiffs. The Trial Court, inter alia, observed that the
sale consideration of Rs. 22,951/- was a peculiar one, because in the
normal course, the parties do not fix the consideration amount in such an
MADHUKAR NIVRUTTI JAGTAP v. SMT. PRAMILABAI
CHANDULAL PARANDEKAR [DINESH MAHESHWARI, J.]
A
B
C
D
E
F
G
H
46
SUPREME COURT REPORTS
[2019] 10 S.C.R.
odd figure and even the rate of Rs. 450/- per acre did not match with the
consideration amount stated in the agreement. The Trial Court also held
that the plaintiffs had failed to prove that they were handed over possession
of the suit property in pursuance of the agreements in question. In view
of its finding on the nature of transaction, the Trial Court observed that
the issue regarding readiness and willingness of the plaintiffs did not
survive for consideration. The Trial Court, of course, held that the
transactions effected in favour of defendant Nos. 4 to 6 were hit by the
doctrine of lis pendens as per Section 52 of the Transfer of Property
Act, 18824; and that the defendant Nos. 4 to 6 were not bona fide
purchasers of suit property. However, in view of its findings on material
issues, the Trial Court held that the plaintiffs were not entitled for specific
performance and recovery of possession but then, directed that the
amount paid by the plaintiffs i.e., the sum of Rs. 6,000/-, be returned to
them, together with interest at the rate of 6% per annum from the date
of decree until payment.
5. Aggrieved by the judgment and decree of the Trial Court, the
plaintiff Nos. 1, 2 & 4 preferred the first appeal that was considered and
dismissed by III Addl. District Judge, Solapur by way of the judgment
and decree dated 30.11.1987. The First Appellate Court, on re-appreciation
of evidence, affirmed the principal findings of the Trial Court on the
nature of transaction, while observing that the plaintiffs had failed to
prove that the amount in question was not that of a loan advanced, as
contended by the defendant Nos. 1 to 3. In regard to this question relating
to the nature of transaction, the First appellate Court specified the
circumstances being relied upon by it in paragraph 17 of its judgment as
follows:-
" 17. Following are the circumstances which reveal that the
documents on which the Plaintiffs have relied upon that the
Defendants Nos. 1 to 3 had agreed to sell the suit land, were
for the purpose of collateral security to the loan advanced
and the intention of the parties to them was not to sell the
land as mentioned in those documents.
(i) As compared to the total price for the land agreed to be
sold, a partly sum was paid towards the advance payment of
the price.
4 Hereinafter also referred to as 'the T.P. Act'.
A
B
C
D
E
F
G
H
47
(ii) The possession of the land was never delivered to the
Plaintiffs in pursuance of the agreement of sale.
(iii) The Plaintiff Nos. 1 and 2 must not be interested in
purchasing the land.
(iv) The notice dated 5.4.1966 was issued by the Plaintiffs
asking the Defendants Nos. 1 to 3 to execute the sale-deed
and, therefore, after this notice the Plaintiffs ought to have
got the sale deed executed if at all the Defendants Nos. 1 to 3
had no objection to do so, instead of getting an agreement of
sale executed."
5.1. The First Appellate Court also held that the plaintiffs had
failed to prove their continuous willingness and readiness to perform
their part of the contract, particularly for the reason that despite stating
the availability of sufficient consideration with them, the plaintiffs got
executed supplementary agreement rather than the sale deed. The First
Appellate Court decided this question against the plaintiffs while observing
as under:-
 "(24) As discussed above, according to the terms of the
agreement of sale, the sale-deed was to be executed on or
about Chaitra Shubha 1, Shake 1888 means on 23rd March,
1966 according to the Gregorian Calender. The Plaintiffs
issued the notice asking the Defendant Nos. 1 to 3 to execute
the sale-deed on 5.4.1966 means after the date on which the
sale deed was got to be executed according to the terms laid
down in the agreement of sale. The Notice (Exb. 87) issued
by the plaintiffs being after the period before which the sale
deed was to be executed cannot be used for proving that the
Plaintiffs were ready and willing to perform their part of the
contract. It was necessary for the Plaintiffs to prove that before
Chaitra Shudha 1, Shake 1888 means 23rd March, 1966 they
were ready and willing to get the sale-deed executed in terms
of the agreement of sale but there is no evidence to prove that
before Chaitra Shudha 1, Shake 1888 the Plaintiffs were ready
and willing to perform their part of contract. When the
Plaintiffs had sufficient consideration in their hand to make
payment of the entire price of the land and when there was
not difficulty for the Defendants Nos. 1 to 3 to dispose of the,
MADHUKAR NIVRUTTI JAGTAP v. SMT. PRAMILABAI
CHANDULAL PARANDEKAR [DINESH MAHESHWARI, J.]
A
B
C
D
E
F
G
H
48
SUPREME COURT REPORTS
[2019] 10 S.C.R.
it is not explained why the supplementary agreement was got
executed instead of getting the sale-deed executed. The
postponement of the sale-deed to which the Plaintiffs gave
consent clearly suggests that the parties were in fact not
intending to execute the sale-deed. The Plaintiffs have, thus
failed to prove that they were ready and willing to perform
their part of contract of getting the sale-deed executed within
the time limit proving in the earlier agreement of sale."
5.2. The First Appellate Court affirmed the finding that the
defendant Nos.