Allowed

G.Ramakrishnan v. L.Murugan

Madras HC30 Oct 2014SA/629/2008

Case brief

AI extract

What is this about?

This Second Appeal dismissing specific performance granted in the first appeal because the plaintiff suppressed material facts, including a prior power of attorney and a criminal case. The court held that the plaintiff did not come to court with clean hands, violating the equitable principles under Section 20 of the Specific Relief Act.

What did the court decide?

Set aside the first appellate order granting specific performance. Direct the respondent to pay the cost received pursuant to the first appellate decree.

G.Ramakrishnan Vs L.Murugan — Specific Performance | Madras HC (2014)

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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Reserved on : 05.09.2014 Date of Decision :30.10.2014

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CORAM

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THE HONOURABLE MR. JUSTICE S.TAMILVANAN

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S.A. No.629 of 2008

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M.P.No.1 of 2008 and M.P.No.1 of 2011

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G. Ramakrishnan .. Appellant/Defendant

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vs L. Murugan .. Respondent/Plaintiff

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Second Appeal is preferred under Section 100 of the Code of Civil Procedure against the Judgment and Decree, dated 30.01.2008 made in A.S.No.50 of 2006 on the file of the Principal District Judge, Villupuram, reversing the Judgment and Decree, dated 20.03.2006 made in O.S.No.112 of 2003 on the file of the Subordinate Judge, Kallakurichi.

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For Appellant : Mr.R.Gandhi, Senior Counsel for Mr.S.Senthil Murugan For Respondent : Mr.S.V.Jeyaraman, Senior Counsel for Mr.D.Rajasekar

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J U D G M E N T

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The Second Appeal has been preferred under Section 100 of the Code of Civil Procedure against the Judgment and Decree, dated 30.01.2008 passed in A.S.No.50 of 2006 on the file of the Principal District Judge, Villupuram, reversing the Judgment and Decree, dated 30.03.2006 passed in O.S.No.112 of 2003 on the file of the Subordinate Judge, Kallkurichi.

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It is seen that the suit was filed by the respondent herein against the appellant, seeking specific performance of the contract, delivery of possession and other consequential relief. After the trial, the suit was decreed, directing the defendant to pay a sum of Rs.50,000/- with costs, in lieu of specific performance and further, held that the plaintiff is entitled to interest for the said amount, Rs.50,000/- at the rate of 6% per annum from 10.01.2002 till the date of realisation. Aggrieved by which, appeal was preferred by the plaintiff in A.S.No.50 of 2006. By Judgment, dated 30.01.2008, the

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appellate Court allowed the appeal, set aside the Judgment and Decree passed by the trial Court, directing the defendant to execute the sale deed in favour of the plaintiff, who is the respondent herein with other consequential relief and costs. Aggrieved by which, the defendant in the suit has preferred this second appeal.

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This second appeal has been admitted on the following Substantial Questions of Law:

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“1. Whether the lower appellate court is right in not applying the settled proposition of law in a suit for specific performance, that even if it is lawful to do so, the Court can exercise its vested discretionary powers under Section 20 of the Specific Relief Act, 1963 and refuse to grant such relief on sound and settled principles, more particularly when it would be grossly inequitable to enforce specific performance and would ultimately result in victimization of the alleged vendor?

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Whether lower appellate Court is right in not considering the specific issue whether the plaintiff has established the existence of a valid agreement of sale and his readiness and willingness to execute the same, which are twin mandatory conditions for a suit for specific performance, merely because the defendant has not filed any cross appeal against the findings of trial court to that extent?

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3.Even though the defendant has not filed cross appeal over the observation of the trial Court, the lower appellate Court ought to have considered the issue relating to the existence of valid agreement of sale and plaintiff's readiness and willingness to execute the same, since the relief of specific performance is an equitable relief. Whether the lower appellate Court is right in failure to adhering to such procedure?”

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The first Substantial Question of Law raised by the appellant is that in a suit seeking specific performance even if the claim is lawful to do so, the Court can exercise its vested discretionary powers under Section 20 of the Specific Relief Act, 1963, whereby refuse to grant such relief on sound and settled principles, more particularly when it would be grossly inequitable to enforce specific performance as it would ultimately result in victimization of the alleged vendor.

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Section 20 of the Specific Relief Act,1963, reads as follows: Discretion as to decreeing specific performance: (1) The jurisdiction to decree specific performance is discretionary, and the Court is not bound to grant such relief merely because it is lawful to do so; but the

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discretion of the Court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a Court of appeal."

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The respondent/plaintiff has averred that he had entered into an agreement of sale with the appellant/defendant on 10.01.2002 in respect of purchasing the suit schedule property for a total sale consideration of Rs.2 lacs. Out of which, a sum of Rs.50,000/- was paid as advance and part of sale consideration on the date of the agreement, 10.01.2002 and as per the terms of agreement, the respondent/plaintiff should pay the balance of sale consideration at Rs.1,50,000/- to the appellant/defendant on or before 10.01.2004 and get sale deed executed and registered at his own costs.

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It is seen that the sale agreement, Ex.A1 dated 10.01.2002 is an unregistered document and the period for performance of contract is between 10.01.2002 and 10.01.2004, for two years. The respondent/plaintiff who was examined as P.W.1 has deposed in his cross-examination that the said agreement had not been registered since he had to spend money for registration of the sale agreement. Subsequently, legal notice dated 01.05.2003 was sent by the respondent/plaintiff to the appellant/defendant and a copy of the same has been marked as Ex.A2, wherein, the respondent/plaintiff has stating that he was ready and willing to pay the balance of sale consideration of Rs.1,50,000/-. However, the appellant/defendant was not ready, hence, he issued a notice demanding the appellant/defendant to perform his part of contract. He had to execute the sale deed after receiving the balance of sale consideration at Rs.1,50,000/- from the respondent/plaintiff. Postal acknowledgment for the receipt of legal notice was also marked as Ex.A3.

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The Appellant/Defendant filed his written statement stating that there was no agreement of sale between himself and the respondent/plaintiff as alleged in the plaint and according to him, it is a false and fabricated document and the defendant had never agreed to sell his property and received part of sale consideration Rs.50,000/- and agreed to receive Rs.1,50,000/- as balance of sale consideration on or before 10.01.2004 and to execute sale deed. He has further stated that Murugan, the respondent/plaintiff was doing real estate business, he approached the appellant/defendant and told that he would get a reasonable amount for his land as sale consideration and asked the defendant to execute a General Power of Attorney deed in his favour. Believing the words and the assurance given by the respondent/plaintiff, the appellant/defendant executed a General power of attorney deed and also signed in non-judicial stamps paper and other papers, as requested by the respondent/plaintiff, however the respondent/plaintiff did not done anything as assured by him, hence, the appellant/first defendant cancelled the power of attorney deed and also lodged a complaint against the respondent herein before Thiyagadurugam Police Station

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on 23.03.2003 and a case was registered in Cr.No.96 of 2003 under Sections 467, 294 (b) and 506 (ii) of IPC against the respondent / plaintiff and subsequently, a village panchayat was conducted and as decided by panchayatdars, on 27.03.2003, the respondent/plaintiff executed a document in the form of a receipt, stating that he received back Rs.50,000/-, alleged to have been given by the respondent / plaintiff to the appellant / defendant in the presence of three witnesses. However, subsequently, the respondent/plaintiff sent a notice dated 01.05.2003 with false averments. After receiving the notice, the appellant / defendant approached the respondent/plaintiff and enquired about the notice sent by the respondent / plaintiff. According to the appellant / defendant, the same had been issued at the instigation of some other persons, however, he assured that no further action would be taken by him against the appellant / defendant.

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P.W.3-Ahmed Hussain was examined as one of the attestors to the unregistered agreement-Ex.A1, as well as the registered power of attorney deed dated 06.11.2002 executed by the appellant/defendant in favour of the respondent/plaintiff. Ex.B1 is said to be receipt, dated 27.03.2003, executed by the respondent/plaintiff with his signature and left hand thumb impression in favour of the appellant / defendant. The attestors to the receipt are stated as Pa.Rajendran, who was examined as D.W.2, one G.Annadurai and also Ahamed Hussain (P.W.3). It is seen that P.W.3 has admitted only his signature available in Ex.B1, Receipt. Mr.R.Gandhi, learned Senior Counsel appearing for the appellant/defendant submitted that the Appellate Court could not have allowed the appeal and granted the relief of specific performance of contract in view of Section 20 of the Specific Relief Act, on the ground that the respondent / plaintiff had not come to Court with clean hands.

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According to the learned Senior Counsel, the document Ex.B1 would show that the respondent/plaintiff had received a sum of Rs.50,000/- from the appellant/defendant, however, suppressing the fact, the suit was filed by him. On going through the document, Ex.B.1 written in a white paper and recitals thereon, it has to be construed that the said amount of Rs.50,000/- was paid by the appellant / defendant and that was received by him towards the advance and part payment of sale consideration, as decided by the panchayatdars.

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The appellant/defendant who was examined as P.W1 has deposed that the respondent/plaintiff who was doing real estate business met him and gave assurance that he would sell the appellant/defendant's property for a reasonable fair price. Believing the words and assurance given by the respondent / plaintiff, he executed a power of attorney deed that was registered on 06.11.2002 on the file of Sub Registrar Office, Vikramangalam Village, Perambalur District. According to the appellant/defendant, the respondent/plaintiff had

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also obtained signatures of the appellant/defendant in unwritten nonjudicial stamp paper and other blank papers. However, as there was no progress made by the respondent/plaintiff, as per the power of attorney deed, the appellant / defendant, police complaint was given by the appellant / defendant on 23.03.2003 against the respondent/plaintiff, based on which, case was registered by Thiyagadurgam police station in Cr.No.96 of 2003 under Sections 467, 294(b) and 506(ii) of IPC against the respondent/plaintiff. According to the learned Senior counsel for the appellant, village panchayat was conducted and as decided in the Panchayat, the appellant / defendant returned the money Rs.50,000/- to the respondent / plaintiff and also cancelled the power of attorney deed executed in his favour on 27.03.2003 and also obtained a receipt, Ex.B.1 signed by the respondent/ plaintiff for he received the money Rs.50,000/-. In the receipt, according to the appellant, the respondent/plaintiff affixed his signature and also his left hand thumb impression (LTI) in the presence of P.W.2, P.W.3 and another witness, hence, the respondent / plaintiff is not entitled to specific relief of the agreement, however, the first appellate court had reversed the judgment and decree of the trial court and granted the relief as prayed for in the suit, contrary to law.

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Mr.R. Gandhi, learned Senior Counsel appearing for the appellant/defendant drew the attention of this Court to the following decisions, in support of his contention.

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(1) In CITADEL FINE PHARMACEUTICALS, 2011 (6) CTC 112, the Hon'ble Apex Court has held as follows:

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“53. ... ... In the instant case by asking for specific performance of the contract, the plaintiffpurchaser is praying for a discretionary remedy. It is axiomatic that when discretionary remedy is prayed for by a party, such party must come to Court on proper disclosure of facts. The Plaint, which it filed before the Court in such cases must state all facts with sufficient candour and clarity. In the instant case, the plaintiff-purchaser made an averment in the Plaint that the Defendant-vendor be directed to return the advance amount of Rs.10,00,000/- at the rate of 24% interest from the date of payment of the said amount till the realisation and an alternative prayer to that effect was also made in the prayer Clause (c ).

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54.However, the fact remains that prior to the filing of the Suit the Defendant-vendor returned the said amount of Rs.10,00,000/- by its Letter dated 4^th September, 1996 by an account payee cheque in favour of the Plaintiff and the same was sent to the Plaintiff under Registered Post which was refused by the Plaintiff on 6.9.1996. The Plaintiff suppressed this fact in the Plaint and filed the Suit on 9.9.1996 with a totally

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contrary representation before the Court as if the amount has not been returned to it by the vendor. This is suppression of a material fact, and disentitles the Plaintiff-purchaser from getting any discretionary relief of specific performance by Court.”

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(2) The Division Bench of this Court relying on various decisions of the Hon'ble Apex Court and this Court, in R.KUMAR V. R.SUSHILKUMAR, (2012) 2 MLJ 204, has held that “In a suit for specific performance, initial burden is on plaintiff to plead and prove his readiness and willingness to perform his obligation under the contract in terms of contract once there is denial of execution of contract.”

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(3) In SANKAR (DIED) AND 4 OTHERS V. N.G.RADHAKRISHNAN, 1994-2-L.W.642, Division Bench of this Court has held as follows: “The agreement for which readiness and willingness is pleaded must be the agreement that is sought to be be implemented and and in terms thereof. When the plaintiff wants an implementation of contract, not according to the terms contained therein, but with modification he deemed proper, and even in the plaint, willingness disclosed was not a willingness to deposit the full balance amount but such balance as remained after making such deductions, he cannot claim to have always been ready and willing to perform his part of the contract.”

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Relying on the decision in Nallava Gounder and another v. P.Ramaswami Gounder and three others, 1993 (2) L.W. 86, Division Bench has held that utmost good faith and honesty is expected from the parties who want the discretion of court to be exercised in his favour. The decision reads that the Division Bench had meticulously considered all facts and circumstances of the case and held that the court was not bound to grant specific performance, merely because it was lawful to do so. The motive behind the litigation should also enter the judicial verdict, hence, the court is bound to see that it is not used as an instrument of oppression to have an unfair advantage in favour of the plaintiff. In such circumstances, if specific performance is granted, the plaintiff will be getting an unfair advantage.

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(4) In N.P.THIRUGNANAM ETC. V. DR.R.JAGAN MOHAN RAO & OTHERS, 1996-1-L.W.239, the Hon'ble Supreme Court has held as follows: “5. It is settled law that remedy for specific performance is an equitable remedy and it in the discretion of the court, which discretion requires to be exercised according to settled principles of law and not arbitrarily as adumbrated under S.20 of the Specific Relief Act 1963 (for short, 'the Act'). Under S.20, the Court is not bound to grant the relief just

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because there was valid agreement of sale. Sale 16(c) of the Act envisages that plaintiff must plead and prove that he had performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than those terms the performance of which has been prevented or waived by the defendant. The continuous readiness and willingness on the part of the plaintiff is a condition precedent to grant the relief of specific performance. This circumstance is material and relevant and is required to be considered by the court while granting or refusing to grant the relief. If the plaintiff fails to either aver or prove the same, he must fail. To adjudge whether the plaintiff is ready and willing to perform his part of the contract, the court must take into consideration the conduct of the plaintiff prior and subsequent to the filing of the suit along with other attending circumstances. The amount of consideration which he has to pay to the defendant must of necessity be proved to be available. Right from the date of the execution till date of the decree he must prove that he is ready and has always been willing to perform his part of the contract. As stated, the factum of his readiness and willingness to perform his part of the contract is to be adjudged with reference to the conduct of the party and the attending circumstances. The court may infer from the facts and circumstances whether the plaintiff was ready and was always ready and willing to perform his party of contract.”

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(5) In P.D'SOUZA V. SHONDRILO NAIDU, AIR 2004 SC 4472, the Hon'ble Apex Court has held that when exercise of discretion under Section 20 of the Specific Relief Act (47 of 1963), that the vendor was landlord of vendee and the vendor accepted part payment from plaintiff from time to time without any demur. He redeemed mortgage only upon receipt of requisite payment from vendee and hence, it was held as too late for the vendor to plead that vendee should be denied benefit of decree having regard to escalation of price of the property. It was argued by the learned Senior counsel for the appellant that the aforesaid decision is not directly applicable to the instant case on hand, since the relief sought for is a discretionary relief and the respondent / plaintiff has suppressed the material facts before the Court below.

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Per contra, Mr.S.V.Jeyaraman, learned Senior Counsel appearing for the respondent drew the attention of this Court to the decision in SILVEY V. ARUN VARGHESE, (2008) 11 SCC 45, wherein the Hon'ble Apex Court has held that the conduct of defendants in taking a false plea has to be taken into account while decreeing or denying a decree for specific performance.

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In NANJAMMAL, ETC., & ANOTHER V. PALANIAMMAL, 1993 (2) LW 205, a Division Bench of this Court referring Section 92 of the Indian Evidence Act has held that the plea in defence could not be accepted, since it was contended that what was written was merely a loan transaction, and by way of security for repayment of loan, agreement for sale was got executed normally could not be accepted. The Division Bench of this Court held that it is not open to the defendant to raise a plea that the terms of the agreement should be ignored and that the real purpose was to secure the loan. In an ordinary circumstance, the defendant is barred from raising such a plea as per Section 92 of the Indian Evidence Act. However, in the decision, it has been made clear that the normal rule is that once the truth of the agreement is made out, the Court shall enforce it unless there are circumstances which would prove that equity would suffer by enforcing the agreement. The Division Bench of this Court has ruled it clear that equity shall not suffer, on account of enforcing the agreement for sale.

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In SILVEY AND OTHERS V. ARUN VARGHESE AND ANOTHER, (2008) 3 MLJ 951 (SC), the Hon'ble Apex Court has laid down a ratio that the conduct of the defendant cannot be ignored while weighing the question of exercise of discretion for decreeing or denying a decree for specific performance. The non-issuance of reply to notice; willful refusal to receive notice; not taking steps to secure licence necessary to engage in particular kind of activity (such as licence for planting rubber) would evidence such conduct that are relevant. As per the decision, when the defendants were not really ready to perform their obligation in terms of the contract and have taken a false plea in the written statement, the suit for specific performance has to be decreed. In the aforesaid decision, the Hon'ble Apex Court has held that the conduct of defendants in taking a false plea has to be taken into account while decreeing or denying a decree for specific performance.

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It is not in dispute that the suit was filed by the respondent / plaintiff seeking a decree for specific performance of agreement of sale dated 10.01.2002 directing the appellant/defendant to execute the sale deed pertaining to the suit property in favour of the respondent/plaintiff, within the time limit fixed by the Court and in default thereof, the Court itself to execute the sale deed through an Officer of the Court, at the cost of the respondent / plaintiff.

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It is well settled by the Hon'ble Apex Court that specific performance of contract is a discretionary remedy and for seeking the remedy the party must come to Court with clean hands, disclosing the facts, which are necessary for proper disposal of the suit. If there is any suppression of material fact, the party would not be entitled to the discretionary relief of specific performance of contract. In a case of specific performance of contract, plaintiff, who is seeking

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the relief has to prove his readiness and willingness to perform his part of the contract as agreed by the parties, when there is denial of his readiness and willingness by the other side. When a party wants the discretionary relief of the Court, to be exercised in his favour he must meticulously place all the necessary facts to show that he has come to court with clean hands and he was ready and willing to perform his part of the contract, as agreed by the parties.

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In this regard, Section 20 of the Specific Relief Act, 1963 is relevant. As contemplated under Section 20 of the said Act, the Court is not bound to grant the discretionary relief, merely because there is valid agreement of sale between the parties. Considering the equity the same has to be decided by the Court, to meet the ends of justice.

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In the instant case, the plaintiff has stated that as per the agreement dated 10.01.2002, the total sale consideration was fixed at Rs.2,00,000/- out of which, he paid Rs.50,000/- as advance and part of sale consideration. It is seen that Ex.A1 is an unregistered agreement and the period for performance of contract is stated as 2 years. On verifying the original, Ex.A.1, it is seen that there are certain interpretation in the agreement in page No.3, however, the same were not countersigned and further the term of agreement is for 2 years, though the agreement relates to the sale of immovable property worth Rs.2 lakhs. Hence, the agreement could have been a registered document, as required by law.

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The appellant / defendant in his proof affidavit has stated that on 06.11.2002, he executed only a registered power of attorney deed in favour of the respondent / plaintiff, believing the assurance given by the respondent to sell the property of the appellant for a reasonable fair price, however, he has not executed unregistered agreement, Ex.A.1. According to the appellant, on the date of power of attorney deed, his signature was obtained in a stamp paper and five other unwritten blank papers. Since the respondent / plaintiff had not acted as per the power of attorney deed, the appellant / defendant gave a complaint against the respondent / plaintiff before the Thiyagadurgam Police Station on 23.03.2003 and a case was registered in Cr.No.96 of 2003 under Sections 467, 294 (b) and 506 (ii) of IPC. Subsequently, there was village panchayat convened and as decided by the panchayatdars, the appellant / defendant paid Rs.50,000/- to the respondent / plaintiff and also cancelled the power of attorney deed executed by him in favour of the respondent / plaintiff. According to the appellant, the respondent / plaintiff had handed over the signed receipt, Ex.B.1 to the appellant, however, the respondent did not hand over his signed papers saying that the said papers were in the custody of his wife, who had gone to some other village and gave assurance that the same would be returned to the

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appellant, after her arrival. However, by using the papers containing signatures and thumb impressions in the stamp paper and other papers, the respondent / plaintiff created Ex.A.1, unregistered agreement.

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Learned Senior Counsel appearing for the appellant / defendant submitted that the attestors have affixed their signatures in Ex.B.1, in the presence of the appellant / defendant, however, the same was denied by the respondent / plaintiff. In the crossexamination, the respondent / plaintiff, as P.W.1 has strangely stated that he did not know whether he had brought the appellant to Vickrayamangalam Sub-Registrar Office, Ariyalur District on 06.11.2002 and got a power of attorney deed, original of Ex.B.2, being executed and registered before the Sub-Registrar.

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Ex.B.2 is a certified copy of the registered power of attorney, dated 06.11.2002 executed by the appellant / defendant in favour of the respondent / plaintiff in respect of the suit property. P.W.3 and D.W.2 have attested the document. It is a registered power of attorney deed between the parties, subsequent to the alleged unregistered sale agreement, Ex.A.1, however, in the power of attorney deed, there is no averments about the alleged unregistered sale agreement, Ex.A.1. There is no explanation from the respondent / plaintiff, as to why there is no averments in the subsequent registered document between the same parties, relating to the suit property.

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As argued by Mr.R.Gandhi, learned Senior counsel appearing for the appellant / defendant, had Ex.A.1, unregistered agreement been a genuine document between the very same parties relating to the suit property, at least in Ex.B.2, registered power of attorney deed, there could have been some averments about Ex.A.1, unregistered sale agreement. It is seen that two persons, namely A.Mannankatti, S/o. S.Arunagiri and one Ahmed Hussain, s/o. Syed Haseem Saheeb are stated as attestors to the document. The first attestor, Mannankatti was not examined as witness in the suit. The second attestor, Ahmed Hussain was examined as P.W.3, however, in his cross-examination, he has admitted only his signature in Ex.B.1. The signature alone was admitted by P.W.3 and as per the document, Ex.B.1, on 27.03.2003, the respondent / plaintiff received Rs.50,000/- from the appellant / defendant, as decided by village panchayatdars, holding that the amount had been paid by the respondent / plaintiff on 10.02.2002, as part of sale consideration. The appellant / defendant, who was examined as D.W.1 has deposed that Rs.50,000/- was paid by him to the respondent / plaintiff and for receiving the amount, the document, Ex.B.1 was executed by the respondent / plaintiff, wherein the respondent / plaintiff affixed his signature and Left hand thumb impression (LTI) in the present of witnesses. In the said document, Ex.B.1, three witnesses have been signed including P.W.3, who has admitted his signature.

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Similarly, D.W.2, who signed as first attestor in Ex.B.1, has deposed that there was a village panchayat convened after the complaint given by the appellant / defendant against the respondent / plaintiff. However, accepting the decision of the village panchayat, the appellant / defendant handed over Rs.50,000/- to the respondent / plaintiff, for which the respondent / plaintiff issued Ex.B.1 receipt with his signature and LTI, wherein, D.W.2 signed as one of the attestors. Though the suit was filed on 02.06.2003, the respondent / plaintiff has suppressed the material facts and also details of the registered power of attorney, dated 06.11.2002, though it was executed by the appellant / defendant in favour of the respondent / plaintiff.

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It is also an important aspect for consideration that the appellant / defendant, in his written statement has specifically stated about the criminal complaint given by him against the respondent / plaintiff and the case in Cr.No.96 of 2003 registered under Sections 467, 294 (b) and 506 (ii) IPC by Thiyagadurgam Police Station against the respondent herein and also about the village panchayat and the payment made by the appellant / defendant to the respondent / plaintiff and also the receipt Ex.B.1 issued by him for receiving Rs.50,000/-. It is relevant that P.W.3 himself has admitted his signature available in Ex.B.1, though he has stated that he did not know the contents of the document. Even in the certified copy of the power of attorney deed, Ex.B.2, Ahmed Hussain, s/o. Syed Haseem Saheeb, examined on the side of the respondent / plaintiff had admitted that he had signed as identifying witness of the parties to Ex.B.2, before the Sub-Registrar. P.W.3 in his cross-examination has admitted that he had been one of the attestors to the power of attorney deed, original of Ex.B.2, dated 06.11.2002. On the said circumstances, it is clear that the respondent / plaintiff has deliberately suppressed the material facts with regard to execution of power of attorney deed, original of Ex.B.2 by the appellant / defendant in his favour, though his witness, P.W.3 has admitted that he was one of the attestors to the said registered document. Though the appellant / defendant had made specific averments about the subsequent events of the criminal complaint given by him against the respondent / plaintiff and the case registered against him by Thiyagadurgam Police station and subsequent village panchayat convened on 27.03.2003 in his written statement and also adduced evidence, the respondent / plaintiff has not even filed any reply statement disputing the aforesaid facts made in the written statement.

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On the facts and circumstances, it cannot be said that the respondent / plaintiff had approached the Courts below, with clean hands for seeking the discretionary relief of specific performance of contract. Having considered the same, the trial court passed a decree, directing the appellant / defendant, to repay the alleged amount, a sum of Rs.50,000/- with interest and costs. However, there was no appeal preferred by the appellant / defendant, challenging the

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judgment and decree passed by the trial court, before the first appellate court, hence, this Court need not go into the correctness of the said decree passed by the trial court. However, the First appellate Court has allowed the appeal filed by the respondent / plaintiff, whereby granted specific performance of contract, though the respondent / plaintiff has not approached the Courts below with clean hands by disclosing all the necessary material facts before the Courts. The evidence available on record, as discussed earlier in this Judgment would make it is clear that the respondent / plaintiff has not approached the Courts below with all relevant details. However, the first appellate court has failed to consider the fact that there is clear suppression of material facts by the respondent / plaintiff.

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In the light of various decisions rendered by the Hon'ble Supreme Court and the Division Bench of this Court, referred to above, it is crystal clear that the respondent / plaintiff is not entitled to seek the discretionary relief of specific performance, on account of suppression of necessary facts to the Courts.

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It has been categorically held by the Hon'ble Supreme Court that as contemplated under Section 20 of the Specific Relief Act, 1963, it is a well settled proposition of law, in a suit for specific performance that even if an agreement of sale is established, the said relief need not be granted, when it would grossly inequitable to enforce specific performance and ultimately result in victimization of the alleged proposed vendor.

¶72

In the instant case, the respondent / plaintiff has suppressed the materials facts that a case had been registered by Thiyagadurgam police station in Cr.No.96 of 2003 on the complaint given by the appellant / defendant. Similarly, suppressed the registered power of attorney deed executed by the appellant / defendant in favour of the respondent / plaintiff, relating to the suit property. It is unfair on the part of the respondent / plaintiff deposing evidence that he did not know about the power of attorney deed executed in his favour by the appellant, though he was a party to the document, however, his witness P.W.3 was admittedly an attestor to the power of attorney deed. Hence, a mere bald denial of Ex.B.2 for receiving the amount Rs.50,000/- and issuing the receipt, Ex.B.1, in spite of the admission of P.W.3 with regard to his signature as attestor and the fact that the respondent / plaintiff had not disputed the averments made in the written statement with regard to the criminal case regisetered against him and as per the village panchayat, receiving Rs.50,000/- from the appellant / defendant by issuing receipt for Rs.50,000/- would go to show that the respondent / plaintiff has not come to Court with clean hands, but only suppressed the important material facts. However, the first appellate court has erroneously reversed the judgment and decree passed by the trial court and granted the discretionary relief of

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specific performance, contrary to law and therefore, this Court is of the view to answer the first substantial question of law in favour of the appellant / defendant and against the respondent / plaintiff.

¶75

It has been made clear that there was a criminal case registered against the respondent / plaintiff by Thiyagadurgam police station, based on the complaint given by the appellant / defendant and in view of the village panchayat, the appellant / defendant paid Rs.50,000/- for which, receipt was also issued by the respondent / plaintiff. In the aforesaid circumstances, it cannot be said that the respondent / plaintiff was ready and willing to perform his part of the contract, pursuant to the agreement for sale. Based on the evidence available and also considering the equity, in view of the suppression of material facts by the respondent / plaintiff, the appellant / defendant was directed by the trial court, to repay the alleged advance amount Rs.50,000/- with interest and costs. Against which, no appeal was preferred by the appellant / defendant, however, merely on the ground that the trial court had directed the appellant / defendant to return the alleged advance amount, the first appellate court, cannot reverse the judgment and decree ad granted relief for specific performance. In the light of the ratio laid down by the Hon'ble Apex Court, specific performance of contract sought for in the suit is an equitable remedy, based on the discretion on equity, the same could be granted in view of Section 20 of Specific Relief Act, 1963.

¶76

Hence, in the light of the decisions rendered by the Hon'ble Supreme Court, referred to above and the decision of the Division Bench of this Court, this Court is of the view that the first appellate court has committed error in reversing the judgment and decree passed by the trial court and granting specific performance of the contract, as there was suppression of fact and granting the discretionary relief would create great prejudice to the appellant / defendant, who has not come to the court with clean hands.

¶77

The relief of specific performance is admittedly an equitable relief. The first appellate court has not properly considered that the respondent / plaintiff has not come to court with clean hands and has suppressed the material facts relating to the case. In the aforesaid circumstances, this Court is of the view that the first appellate court is not right in granting the equitable relief, holding that the respondent / plaintiff was ready and willing to perform his part of the contract. It is crystal clear that the respondent / plaintiff is not entitled to seek the discretionary relief of specific performance on the ground that he has not come to court with clean hands and also on account of suppression of material facts. Hence, the substantial questions of law 2 and 3 are also answered in favour of the appellant /defendant and against the respondent / plaintiff. However, as there is no cross-appeal preferred by the appellant / defendant against the judgment and

¶78

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¶79

decree passed by the trial court, in respect of the advance amount, it has to be legally presumed that the judgment and decree passed by the trial court has not been assailed by the appellant / defendant herein.

¶80

In the result, this Second Appeal is allowed and the Judgment and Decree, dated 30.01.2008 rendered by the First Appellate Court in A.S.No.50 of 2006 on the file of the Principal District Judge, Villupuram is set aside. Consequently, connected miscellaneous petitions are closed. The respondent / plaintiff is directed to pay the cost, that was received by him from the appellant / defendant, pursuant to the judgment and decree passed by the first appellate court. So far as the second appeal is concerned, both the parties are directed to bear their own cost.

¶81

Sd/-
Assistant Registrar
//True Copy//
Sub Assistant Registrar
tsvn
To
1. The Principal District Judge
Villupuram.
2. The Subordinate Judge
Kallakurichi.
+ 1 cc to Mr.M. Saravanan Kumar, Advocate SR.51343
+ 2 ccs to M/s. S. Senthil Murugan, Advocate SR.51570, 51838
S.A.No.629 of 2008
UG(CO)
Eu 5.12.14

¶82

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G.Ramakrishnan v. L.Murugan

Case brief

What is this about?

What did the court decide?

G.Ramakrishnan v. L.Murugan

Case brief

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What the court decided

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