Sangita Sinha vs. Bhawana Bhardwaj

2025 INSC 450
REPORTABLE

IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 4972 OF 2025
(Arising out of Special Leave Petition (C) No.28460 of 2024)

SANGITA SINHA .…. APPELLANT
VERSUS
BHAWANA BHARDWAJ AND ORS. ..…RESPONDENTS

J U D G M E N T
MANMOHAN, J
1. Leave granted.
2. The primary issue that arises for consideration in the present civil
appeal is whether a suit for specific performance of an Agreement to Sell is
liable to be decreed if the buyer had accepted the refund of majority of the
earnest money deposit/advance consideration, during the pendency of the
civil suit?
3. Brief facts leading to the present appeal are as under:-
3.1. Late Kushum Kumari (“original defendant” / “seller”) was
allotted the subject property by the People's Cooperative House
Construction Society Limited (“Society”) vide a registered sub-lease
Signature Not Verified
nd
Digitally signed by
dated 2 April 1968.
rashmi dhyani pant
Date: 2025.04.04
17:03:17 IST
Reason:
SLP (C) No.28460 of 2024 Page 1 of 22

th
3.2. On 25 January 2008, an unregistered Agreement to Sell with
respect to the subject property was executed between the
“Respondent No.1-buyer”-plaintiff and the seller for a total sale
consideration of Rs. 25,00,000/- (Rupees Twenty Five Lakhs). At the
time of the execution of the Agreement to Sell, the Respondent No.1-
buyer paid a sum of Rs.2,51,000/- (Rupees Two Lakh Fifty One
Thousand) in cash to the seller and issued three post-dated cheques
worth Rs.7,50,000/- (Rupees Seven Lakh Fifty Thousand).
3.3. It is the case of Respondent No.1-buyer that when she visited
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the subject property along with her husband on 11 February 2008,
the tenants of the seller created a scuffle and forced them to return.
In the circumstance, the Respondent No.1-buyer issued legal notices
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dated 23 February 2008 and 23 April 2008, expressing her
intention to pay the balance sale consideration and to get the property
registered in her favour.
3.4. Upon the failure of the seller to execute the sale deed,
Respondent No.1-buyer filed a suit before the Trial Court, Sub
Judge-IV, Patna under the Specific Performance Act, 1963 (“Act,
1963)” seeking specific performance of the Agreement to Sell dated
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25 January 2008 and the same was registered as Title Suit No.
TS/176/2008 (“subject suit”).
3.5. The subject suit was contested by the seller by filing a written
statement, stating therein that she came to know about the
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Agreement to Sell dated 25 January 2008 on 5 February 2008 and
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immediately thereafter, made a complaint dated 6 February 2008
with the Inspector of Police-cum-Station House Officer, Kankarbagh
SLP (C) No.28460 of 2024 Page 2 of 22

Police Station, Patna stating that her signatures had been fraudulently
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taken on the Agreement to Sell dated 25 January 2008. It was further
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stated that the seller issued a letter dated 7 January 2008 cancelling
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the Agreement to Sell dated 25 January 2008 and refunded
Rs.2,11,000/- (Rupees Two Lakh Eleven Thousand) through five
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demand drafts dated 7 February 2008 in lieu of the cash and
returned two of the three post-dated cheques of Rs.2,50,000/-
(Rupees Two Lakh Fifty Thousand) each, which were issued by the
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seller. Vide Order dated 16 December 2008, issues were framed by
the Trial Court.
3.6. Upon the demise of the seller, the Respondent No.3 herein,
who is the step grandson of the seller, was impleaded as substituted
defendant no. 1 and the appellant herein was impleaded as defendant
no. 3 as the subject property had been bequeathed in her favour by
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way of a Will dated 23 September 2002 executed by the original
owner/seller.
3.7. After consideration of the depositions of PW-1 (Respondent
No.1 herein) and her husband, PW-2, the Trial Court framed three
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additional issues vide order dated 21 January 2013. The issues were
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framed once again on 27 April 2018, and a judgment was passed in
favour of Respondent No.1-buyer on the same date.
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3.8. The judgment dated 27 April 2018 and the decree dated 10
May 2018 were challenged by the appellant herein in First Appeal
No. 83 of 2018. The said appeal was dismissed by the Patna High
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Court vide the impugned Judgment dated 9 May 2024.
SLP (C) No.28460 of 2024 Page 3 of 22

3.9. Upon the present Special Leave Petition being filed, this
Court, while issuing notice, had directed parties to maintain status
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quo with respect to the possession on 20 August 2024.


SUBMISSIONS ON BEHALF OF THE APPELLANT
4. Shri S.B. Upadhyay, learned senior counsel for the appellant, stated
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that the signatures of the seller on the Agreement to Sell dated 25 January
2008 had been fraudulently obtained by Respondent No.3 herein. He stated
that the seller-defendant signed some blank papers believing the same to be
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related to the Will that she had executed in favour of the appellant on 23
September 2002.
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5. He stated that upon the discovery of the Agreement to Sell dated 25
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January 2008 on 5 February 2008, the seller made a criminal complaint
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dated 6 February 2008 with the Inspector of Police-cum-Station House
Officer, Kankarbagh, Patna that her signatures had been fraudulently
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obtained on the Agreement to Sell dated 25 January 2008.
th
6. He stated that on 7 February 2008, the seller wrote a letter to
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Respondent No.1-buyer cancelling the Agreement to Sell dated 25
th
January 2008 enclosing therewith five demand drafts dated 7 February
2008 amounting to Rs. 2,11,000/- (Rupees Two Lakh Eleven Thousand) in
lieu of the cash and two of the three post-dated cheques of Rs.2,50,000/-
(Rupees Two Lakh Fifty Thousand) each, which were issued by the
Respondent No.1-buyer.
7. He pointed out that the Respondent No.1-buyer as well as her
husband-PW2, in their depositions, have admitted that they had received
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five demand drafts dated 7 February 2008 amounting to Rs. 2,11,000/-
SLP (C) No.28460 of 2024 Page 4 of 22

(Rupees Two Lakh Eleven Thousand) in lieu of the cash and also received
two of the three post-dated cheques of Rs.2,50,000/- (Rupees Two Lakh
Fifty Thousand) along with the letter cancelling the Agreement to Sell dated
th
25 January 2008 in March 2008. He explained that five demand drafts
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dated 7 February 2008 of Rs.2,11,000/- (Rupees Two Lakh Eleven
Thousand) were encashed by the Respondent No.1-buyer in July 2008, after
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institution of the subject suit on 5 May 2008. He submitted that the
encashment of the demand drafts amounted to revocation of the Agreement
th
to Sell dated 25 January 2008. He contended that the subject suit was filed
by the Respondent No.1-buyer after revocation of the Agreement to Sell
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dated 25 January 2008, without seeking any relief against the revocation
and without disclosing that she was in receipt of the demand drafts and post-
dated cheques.
8. He contended that the subject suit was filed on the basis of an
Agreement to Sell which stood cancelled and as such, the same was not
maintainable. He submitted that existence of a valid agreement is sine qua
non for grant of relief of specific performance. He pointed out that, in
similar circumstances, this Court in R. Kandasamy (Since Dead) & Ors.
vs. T.R.K. Sarawathy & Anr. (Civil Appeal No. 3015 of 2013 decided on
st
21 November 2024 ), had set aside the judgment and decree passed in
favour of the Respondent No.1-buyer inter alia on the ground that a non-
existent Agreement to Sell cannot be enforced by a Court of law.
9. Even otherwise, he contended that the Respondent No.1-buyer was
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not ready and willing to perform the Agreement to Sell dated 25 January
2008. He stated that a mere averment that the Respondent No.1-buyer is
ready and willing to perform the contract will not suffice as readiness and
SLP (C) No.28460 of 2024 Page 5 of 22

willingness must be inferred in overall circumstances of the case, including
the conduct of the Respondent No.1-buyer prior and subsequent to the filing
of the suit.
10. He pointed out that the Respondent No.1-buyer in her cross-
examination, had admitted that at the time of execution of the agreement,
she was not aware of the balance in her bank account and at the time when
the three post-dated cheques for Rs.2,50,000/- (Rupees Two Lakh Fifty
Thousand) were issued, there was no sufficient balance in her account. He
contended that the conduct of the Respondent No.1-buyer in encashing the
demand drafts proved that she was not ready or willing to perform the
contract. In support of his contentions, he relied upon the judgments of this
Court in Mehboob-Ur-Rehman (Dead) through Legal Representatives vs.
Ahsanul Ghani, (2019) 19 SCC 415 and C.S. Venkatesh vs. A.S.C. Murthy
(Dead) by Legal Representatives and Ors., (2020) 3 SCC 280 .
SUBMISSIONS ON BEHALF OF RESPONDENT NO. 1
11. Per contra , Mr. Mungeshwar Sahoo, learned senior counsel for the
Respondent No.1-buyer stated that the suit had been decreed in favour of
the Respondent No.1-buyer by the Trial Court after rightly appreciating the
evidence and a sale deed had been executed subsequently in favour of the
Respondent No.1-buyer upon deposit of Rs. 24,61,000/- (Rupees Twenty
Four Lakh Sixty One Thousand) before the Trial Court. He contended that
the judgment and decree passed by the Trial Court had been rightly upheld
by the High Court. He stated that the entire case of the appellant in the
present proceedings is based upon reappreciation of evidence and the same
cannot be permitted at this stage.
SLP (C) No.28460 of 2024 Page 6 of 22

12. He stated that the entire earnest money/advance consideration had
not been refunded/returned by the seller. He stated that the Respondent
No.1-buyer had paid Rs.2,51,000/- (Rupees Two Lakh Fifty One
Thousand) in cash to the seller against which the seller had refunded
Rs.2,11,000/- (Rupees Two Lakh Eleven Thousand) through five demand
th
drafts dated 7 February 2008. Therefore, according to him, an amount of
Rs. 40,000/- (Rupees Forty Thousand) remained with the seller as earnest
money/advance consideration. He contended that as the balance sale
consideration had been paid subsequently, the cancellation of the
th
Agreement to Sell dated 25 January 2008 was not valid.
13. Even otherwise, he stated that a bilateral agreement cannot be
unilaterally cancelled by a party by returning the earnest money. According
to him, a (bilateral) agreement can only be cancelled by a Court of law or
by executing a subsequent agreement, cancelling the prior agreement. He
stated that in the event parties are permitted to unilaterally cancel the
agreement, the purchaser will be left remediless as any third party can
intervene by offering a higher earnest money.
14. He contended that the seller passed away before she could prove her
defense by leading evidence. He stated that neither the appellant nor the
Respondent No.3 herein had deposed in support of the written statement
filed by the seller. He therefore stated that the written statement of the seller
had not been proved. He also contended that the appellant did not have the
locus to file the present appeal. According to him, the appellant had no
right, title or interest in the subject property and the findings of the Trial
Court or the High Court do not affect the appellant in any manner.

SLP (C) No.28460 of 2024 Page 7 of 22

COURT’S REASONING
RESPONDENT NO.1 WAS NOT WILLING TO PERFORM THE
AGREEMENT TO SELL
15. Having heard learned senior counsel / learned counsel for the parties
and having perused the paper book, the admitted position that emerges is
that Respondent No.1-buyer had paid Rs. 2,51,000/- (Rupees Two Lakh
Fifty One Thousand) in cash and handed over three post-dated cheques of
Rs.2,50,000/- (Rupees Two Lakh Fifty Thousand) each at the time of
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execution of the Agreement to Sell dated 25 January 2008. It is also not
disputed that the Respondent No.1-buyer had subsequently received a letter
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dated 7 February 2008 cancelling the Agreement to Sell dated 25 January
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2008 enclosing therewith five demand drafts dated 7 February 2008
totaling to Rs.2,11,000/- (Rupees Two Lakh Eleven Thousand) (in lieu of
the cash paid by the Respondent No.1-buyer) along with two of the three
post-dated cheques of Rs.2,50,000/- (Rupees Two Lakh Fifty Thousand)
each, which had been issued initially by the Respondent No.1-buyer.
Further, the third post-dated cheque which was not returned to the
Respondent No.1-buyer had not been encashed. The Respondent No.1-
th
buyer has admitted that the letter dated 7 February 2008 had been received
prior to filing of the suit for specific performance and five demand drafts
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dated 7 February 2008 totaling to Rs.2,11,000/- (Rupees Two Lakh Eleven
Thousand) had been encashed in July, 2008 after institution of the subject
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suit on 5 May 2008, without raising any objection with respect to the
difference in the cash amount and the demand drafts furnished by the seller.
16. It is settled law that under the Act, 1963, prior to the 2018
Amendment, specific performance was a discretionary and equitable relief.
SLP (C) No.28460 of 2024 Page 8 of 22

In Kamal Kumar vs. Premlata Joshi and Ors., (2019) 3 SCC 704 , which
has been followed in P. Daivasigamani vs. S. Sambandan, (2022) 14 SCC
793 , this Court framed material questions which require consideration prior
to grant of relief of specific performance. The relevant portion of the
judgment in Kamal Kumar (supra) is reproduced hereinbelow:
“7. It is a settled principle of law that the grant of relief of specific
performance is a discretionary and equitable relief. The material
questions, which are required to be gone into for grant of the relief
of specific performance, are:

7.1. First, whether there exists a valid and concluded contract
between the parties for sale/purchase of the suit property.

7.2. Second, whether the plaintiff has been ready and willing
to perform his part of contract and whether he is still ready
and willing to perform his part as mentioned in the contract.

7.3. Third, whether the plaintiff has, in fact, performed his part
of the contract and, if so, how and to what extent and in what
manner he has performed and whether such performance was
in conformity with the terms of the contract;

7.4. Fourth, whether it will be equitable to grant the relief of
specific performance to the plaintiff against the defendant in
relation to suit property or it will cause any kind of hardship
to the defendant and, if so, how and in what manner and the
extent if such relief is eventually granted to the plaintiff;

7.5. Lastly, whether the plaintiff is entitled for grant of any
other alternative relief, namely, refund of earnest money, etc.
and, if so, on what grounds.

8. In our opinion, the aforementioned questions are part of the
statutory requirements [See Sections 16(c), 20, 21, 22, 23 of the
Specific Relief Act, 1963 and Forms 47/48 of Appendices A to C of
the Code of Civil Procedure]. These requirements have to be
properly pleaded by the parties in their respective pleadings and
SLP (C) No.28460 of 2024 Page 9 of 22

proved with the aid of evidence in accordance with law. It is only
then the Court is entitled to exercise its discretion and accordingly
grant or refuse the relief of specific performance depending upon
the case made out by the parties on facts.”

17. It is trite law that ‘ readiness’ and ‘willingness’ are not one but two
separate elements. ‘Readiness’ means the capacity of the Respondent No.1-
buyer to perform the contract, which would include the financial position
to pay the sale consideration. ‘ Willingness’ refers to the intention of the
Respondent No.1-buyer as a purchaser to perform his part of the contract,
which is inferred by scrutinising the conduct of the Respondent No.1-buyer
/purchaser, including attending circumstances.
18. Continuous readiness and willingness on the part of the Respondent
No.1-buyer /purchaser from the date of execution of Agreement to Sell till
the date of the decree, is a condition precedent for grant of relief of specific
performance. This Court in various judicial pronouncements has held that
it is not enough to show the readiness and willingness up to the date of the
plaint as the conduct must be such as to disclose readiness and willingness
at all times from the date of the contract and throughout the pendency of
the suit up to the decree. A few of the said judgments are reproduced
hereinbelow:-
A. In Gomathinayagam Pillai and Ors. vs. Palaniswami Nadar,
(1967) 1 SCR 227 , it has been held as under:-
“6. But the respondent has claimed a decree for specific
performance and it is for him to establish that he was, since the date
of the contract, continuously ready and willing to perform his part
of the contract. If he fails to do so, his claim for specific
performance must fail. As observed by the Judicial Committee of
the Privy Council in Ardeshir Mama v. Flora Sassoon 1928 SCC
OnLine PC 43:
SLP (C) No.28460 of 2024 Page 10 of 22

“In a suit for specific performance, on the other hand, he treated
and was required by the Court to treat the contract as still
subsisting. He had in that suit to allege, and if the fact was
traversed, he was required to prove a continuous readiness and
willingness, from the date of the contract to the time of the
hearing, to perform the contract on his part. Failure to make
good that averment brought with it the inevitable dismissal of his
suit.”

The respondent must in a suit for specific performance of an
agreement plead and prove that he was ready and willing to
perform his part of the contract continuously between the date of
the contract and the date of hearing of the suit ….”
(emphasis supplied)
B. In Vijay Kumar and Others vs. Om Parkash, 2018 SCC OnLine
SC 1913 , it has been held as under:-
“6. In order to obtain a decree for specific performance, the
plaintiff has to prove his readiness and willingness to perform his
part of the contract and the readiness and willingness has to be
shown throughout and has to be established by the plaintiff ….”
(emphasis supplied)
C. In J.P.Builders and Another vs. A. Ramadas Rao and Another,
(2011) 1 SCC 429 , it has been held as under:-
“27. It is settled law that even in the absence of specific plea by the
opposite party, it is the mandate of the statute that the plaintiff has
to comply with Section 16(c) of the Specific Relief Act and when
there is non-compliance with this statutory mandate, the court is not
bound to grant specific performance and is left with no other
alternative but to dismiss the suit. It is also clear that readiness to
perform must be established throughout the relevant points of
time. “Readiness and willingness” to perform the part of the
contract has to be determined/ascertained from the conduct of the
parties .”
(emphasis supplied)
D. In Umabai and Another vs. Nilkanth Dhondiba Chavan (Dead)
By LRs. and Another, (2005) 6 SCC 243 , it has been held as under:-
SLP (C) No.28460 of 2024 Page 11 of 22

“30. It is now well settled that the conduct of the parties, with a view
to arrive at a finding as to whether the plaintiff-respondents were
all along and still are ready and willing to perform their part of
contract as is mandatorily required under Section 16 (c) of the
Specific Relief Act must be determined having regard to the entire
attending circumstances. A bare averment in the plaint or a
statement made in the examination-in- chief would not suffice.
The conduct of the plaintiff- respondents must be judged having
regard to the entirety of the pleadings as also the evidence brought
on records. ”
(emphasis supplied)
E. In Mehboob-Ur-Rehman (Dead) through Legal Representatives v.
Ahsanul Ghani (supra), it has been held as under:-
“16. Such a requirement, of necessary averment in the plaint, that
he has already performed or has always been ready and willing to
perform the essential terms of the contract which are to be
performed by him being on the plaintiff, mere want of objection by
the defendant in the written statement is hardly of any effect or
consequence. The essential question to be addressed to by the
Court in such a matter has always been as to whether, by taking
the pleading and the evidence on record as a whole, the plaintiff
has established that he has performed his part of the contract or
has always been ready and willing to do so... ”
(emphasis supplied)

SLP (C) No.28460 of 2024 Page 12 of 22

circumstances. The amount which he has to pay the defendant must
be of necessity to be proved to be available. Right from the date of
the execution of the contract till the date of decree, he must prove
that he is ready and willing to perform his part of the contract.
The court may infer from the facts and circumstances whether the
plaintiff was ready and was always ready to perform his contract.

17. In N.P. Thirugnanam v. R. Jagan Mohan Rao [N.P.
Thirugnanam v. R. Jagan Mohan Rao, (1995) 5 SCC 115], it was
held that continuous readiness and willingness on the part of the
plaintiff is a condition precedent to grant of 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 to 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 necessarily be proved to be available .

18. In Pushparani S. Sundaram v. Pauline Manomani
James [Pushparani S. Sundaram v. Pauline Manomani James,
(2002) 9 SCC 582], this Court has held that inference of readiness
and willingness could be drawn from the conduct of the plaintiff and
the totality of circumstances in a particular case. It was held thus:
(SCC p. 584, para 5)
“5. … So far these being a plea that they were ready and willing
to perform their part of the contract is there in the pleading, we
have no hesitation to conclude, that this by itself is not sufficient
to hold that the appellants were ready and willing in terms of
Section 16(c) of the Specific Relief Act. This requires not only
such plea but also proof of the same. Now examining the first of
the two circumstances, how could mere filing of this suit, after
exemption was granted be a circumstance about willingness or
readiness of the plaintiff. This at the most could be the desire of
the plaintiff to have this property. It may be for such a desire
this suit was filed raising such a plea. But Section 16(c) of the
SLP (C) No.28460 of 2024 Page 13 of 22

said Act makes it clear that mere plea is not sufficient, it has to
be proved.”
(emphasis supplied)

19. Consequently, the readiness and willingness of the buyer to go ahead
with the sale of the property at the time of the institution of the suit loses its
relevance, if the Respondent No.1-buyer is unable to establish that the
readiness and willingness has continued throughout the pendency of the
suit.
20. After examination of the pleadings and evidence in the present suit
as well as the conduct of the Respondent No.1-buyer, this Court is unable
to agree with Respondent No.1-buyer that she was willing to perform the
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Agreement to Sell dated 25 January, 2008 and go ahead with the purchase
of the property. This Court says so because admittedly, as noted above, the
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five demand drafts dated 7 February 2008 for Rs. 2,11,000/- (Rupees Two
Lakh Eleven Thousand) were encashed by the Respondent No.1-buyer in
July, 2008. The conduct of the Respondent No.1-buyer in encashing the
demand drafts establishes beyond doubt that the Respondent No.1-buyer
was not willing to perform her part of the Agreement to Sell and proceed
with execution of the sale deed; for the Respondent No.1-buyer would not
have encashed the demand drafts if she was indeed willing to perform the
contract and have a sale deed executed. Consequently, once it is established
that the Respondent No. 1-buyer is not willing to perform the contract, the
fact that the entire advance consideration/earnest money had not been
returned to Respondent No.1-buyer is irrelevant and immaterial.

SLP (C) No.28460 of 2024 Page 14 of 22

TH
THE AGREEMENT TO SELL DATED 25 JANUARY 2008 STOOD
CANCELLED / TERMINATED .
21. This Court is also of the view that the act of the Respondent No.1-
buyer in encashing the demand drafts leads to an irresistible conclusion that
the agreement in question stood cancelled.
22. The contention of the learned counsel for the Respondent No. 1-
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buyer that the Agreement to Sell dated 25 January 2008 could not have
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been cancelled unilaterally is contrary to facts as the letter dated 07
February 2008 along with the refund of the demand drafts and two post-
dated cheques was nothing but repudiation of the Agreement to Sell dated
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25 January 2008 by the seller and the encashment of the demand drafts
was acceptance of such repudiation by the Respondent No.1-buyer, leading
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to cancellation of the Agreement to Sell dated 25 January 2008.
23. The contention that the demand drafts were encashed under protest
is misconceived on facts as there is nothing on record to show that the
demand drafts were encashed under protest. In fact, PW-2, who is the
husband of the Respondent No.1-buyer, has deposed that upon receipt of
the demand drafts and cheques, the Respondent No.1-buyer had not issued
any letter to the seller stating that the amounts received by them were less
than the earnest money paid by them.
ABSENT A PRAYER FOR DECLARATORY RELIEF THAT
CANCELLATION OF THE AGREEMENT IS BAD IN LAW, A SUIT FOR
SPECIFIC PERFORMANCE IS NOT MAINTAINABLE
24. This Court further finds that the seller had admittedly issued a letter
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dated 7 February 2008 cancelling the Agreement to Sell dated 25 January
th
2008, prior to the filing of the subject suit on 5 May 2008. Even though
SLP (C) No.28460 of 2024 Page 15 of 22

th
the demand drafts enclosed with the letter dated 07 February, 2008 were
subsequently encashed in July, 2008, yet this Court is of the view that it
was incumbent upon the Respondent No.1-buyer to seek a declaratory relief
that the said cancellation is bad in law and not binding on parties for the
reason that existence of a valid agreement is sine qua non for the grant of
relief of specific performance.
25. This Court in I.S. Sikandar (Dead) By LRs. v. K. Subramani and
Others, (2013) 15 SCC 27 has held that in absence of a prayer for a
declaratory relief that the termination of the agreement is bad in law, the
suit for specific performance of that agreement is not maintainable. Though
subsequently, this Court in A. Kanthamani Vs. Nasreen Ahmed, (2017) 4
SCC 654 has held that the declaration of law in I.S. Sikander (Dead) By
LRs. v. K. Subramani (supra) regarding non-maintainability of the suit in
the absence of a challenge to letter of termination is confined to the facts of
the said case, yet the aforesaid issue has been recently considered in R.
Kandasamy (Since Dead) & Ors. v. T.R.K. Sarawathy & Anr. (supra)
authored by brother Justice Dipankar Datta and the conflict between the
judgment of I.S. Sikander (Dead) By LRs. v. K. Subramani (supra) and A.
Kanthamani Vs. Nasreen Ahmed (supra) has been deliberated upon. In R.
Kandasamy (Since Dead) & Ors. v. T.R.K. Sarawathy & Anr. (supra), it
has been clarified that the appellate court would not be precluded from
examining whether the jurisdictional fact exists for grant of relief of
specific performance, notwithstanding the fact that the trial Court omitted
or failed to frame an issue on maintainability of the suit. The relevant
portion of the judgment in R. Kandasamy (Since Dead) & Ors. v. T.R.K.
Sarawathy & Anr. (supra) is reproduced hereinbelow:
SLP (C) No.28460 of 2024 Page 16 of 22

“25. What follows from A. Kanthamani (supra) is that unless an
issue as to maintainability is framed by the Trial Court, the suit
cannot be held to be not maintainable at the appellate stage only
because appropriate declaratory relief has not been prayed.
xxx xxx xxx xxx

43. In Shrisht Dhawan (Smt) v. Shaw Bros., (1992) 1 SCC 534 , an
interesting discussion on ‘jurisdictional fact’ is found in the
concurring opinion of Hon’ble R. M. Sahai, J. (as His Lordship then
was). It reads:

“19. What, then, is an error in respect of jurisdictional *
fact? A jurisdictional fact is one on existence or non-existence
of which depends assumption or refusal to assume jurisdiction
by a court, tribunal or an authority. In Black’s Legal
Dictionary it is explained as a fact which must exist before a
court can properly assume jurisdiction of a particular case.
Mistake of fact in relation to jurisdiction is an error of
jurisdictional fact. No statutory authority or tribunal can
assume jurisdiction in respect of subject matter which the
statute does not confer on it and if by deciding erroneously the
fact on which jurisdiction depends the court or tribunal
exercises the jurisdiction then the order is vitiated. Error of
jurisdictional fact renders the order ultra vires and bad
(Wade, Administrative Law. In Raza Textiles [(1973) 1 SCC
633] it was held that a court or tribunal cannot confer
jurisdiction on itself by deciding a jurisdictional fact wrongly.
*
(emphasis supplied)
44. Borrowing wisdom from the aforesaid passage, our deduction is
this. An issue of maintainability of a suit strikes at the root of the
proceedings initiated by filing of the plaint as per requirements of
Order VII Rule 1, CPC. If a suit is barred by law, the trial court has
absolutely no jurisdiction to entertain and try it. However, even
though a given case might not attract the bar envisaged by section 9,
CPC, it is obligatory for a trial court seized of a suit to inquire and
SLP (C) No.28460 of 2024 Page 17 of 22

ascertain whether the jurisdictional fact does, in fact, exist to enable
it (the trial court) to proceed to trial and consider granting relief to
the plaintiff as claimed. No higher court, much less the Supreme
Court, should feel constrained to interfere with a decree granting
relief on the specious ground that the parties were not put
specifically on notice in respect of a particular line of attack/defence
on which success/failure of the suit depends, more particularly an
issue touching the authority of the trial court to grant relief if the
‘jurisdictional fact’ imperative for granting relief had not been
satisfied. It is fundamental, as held in Shrisht Dhawan (supra), that
assumption of jurisdiction/refusal to assume jurisdiction would
depend on existence of the jurisdictional fact. Irrespective of whether
the parties have raised the contention, it is for the trial court to satisfy
itself that adequate evidence has been led and all facts including the
jurisdictional fact stand proved for relief to be granted and the suit
to succeed. This is a duty the trial court has to discharge in its pursuit
for rendering substantive justice to the parties, irrespective of
whether any party to the lis has raised or not. If the jurisdictional
fact does not exist, at the time of settling the issues, notice of the
parties must be invited to the trial court’s prima facie opinion of non-
existent jurisdictional fact touching its jurisdiction. However, failure
to determine the jurisdictional fact, or erroneously determining it
leading to conferment of jurisdiction, would amount to wrongful
assumption of jurisdiction and the resultant order liable to be
branded as ultra vires and bad.


45. Should the trial court not satisfy itself that the jurisdictional fact

for grant of relief does exist, nothing prevents the court higher in the
hierarchy from so satisfying itself. It is true that the point of
maintainability of a suit has to looked only through the prism of
section 9, CPC, and the court can rule on such point either upon
framing of an issue or even prior thereto if Order VII Rule 11 (d)
thereof is applicable. In a fit and proper case, notwithstanding
omission of the trial court to frame an issue touching jurisdictional
fact, the higher court would be justified in pronouncing its verdict
upon application of the test laid down in Shrisht Dhawan (supra).


SLP (C) No.28460 of 2024 Page 18 of 22

46. In this case, even though no issue as to maintainability of the suit
had been framed in course of proceedings before the Trial Court,
there was an issue as to whether the Agreement is true, valid and
enforceable which was answered against the sellers. Obviously,
owing to dismissal of the suit, the sellers did not appeal.
Nevertheless, having regard to our findings on the point as to
whether the buyer was ‘ready and willing’, we do not see the
necessity of proceeding with any further discussion on the point of
jurisdictional fact here.”

th
26. Since in the present case, the seller had issued a letter dated 07
February, 2008 cancelling the agreement to sell prior to the institution of
the suit, the same constitutes a jurisdictional fact as till the said cancellation
is set aside, the respondent is not entitled to the relief of specific
performance.
27. Consequently, this Court is of the opinion that absent a prayer for
declaratory relief that termination/cancellation of the agreement is bad in
law, a suit for specific performance is not maintainable.

APPELLANT HAS THE LOCUS STANDI TO FILE THE APPEAL

28. The preliminary objection raised by the Respondent No.1-buyer that
the issue of her readiness and willingness should not be examined by this
Court as the appellant lacked the locus standi to file the present appeal as
she did not have any right, interest or title over the subject property is
misconceived on facts. The appellant was impleaded as defendant no. 3 in
rd
the subject suit as she is a beneficiary under the Will dated 23 September
2002 executed by the original owner/seller, whereby the subject property
has been bequeathed in her favour. Consequently, the appellant, being a
necessary and interested party to the lis , has the locus to file the present
SLP (C) No.28460 of 2024 Page 19 of 22

appeal. Further, the onus to establish readiness and willingness is on the
Respondent No.1-buyer and the failure to establish the same disentitles the
Respondent No.1-buyer from the equitable and discretionary relief of
specific performance.
SUPPRESSION OF MATERIAL FACTS DISENTITLES THE BUYER
FROM THE EQUITABLE AND DISCRETIONARY RELIEF OF SPECIFIC
PERFORMANCE
29. A perusal of the record shows that not only did the Respondent No.
1-buyer fail to seek a declaratory relief, but also it failed to disclose in the
th
plaint that the seller had issued the cancellation letter dated 7 February
th
2008 enclosing therewith the demand drafts dated 7 February 2008 and
two of the three post-dated cheques. The failure of the Respondent No. 1-
buyer to disclose the same in her plaint amounts to suppression of material
fact, disentitling her from the discretionary relief of specific performance.
This Court in Citadel Fine Pharmaceuticals v. Ramaniyam Real Estates
Private Limited and Another , (2011) 9 SCC 147 has held as under:
“ 57 . There is another aspect of the matter also. In the instant case
by asking for specific performance of the contract, the plaintiff
purchaser is praying for a discretionary remedy. It is axiomatic
that when a 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 the
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 with interest at the rate of 24% 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).

58. However, the fact remains that prior to the filing of the suit
the defendant vendor returned the said amount of Rs 10,00,000
SLP (C) No.28460 of 2024 Page 20 of 22

by its letter dated 4-9-1996 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 contrary representation before the
court as if the amount had 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 the court.

59. In this connection we may refer to the Principle of Equitable
Remedies by I.C.F. Spry, (4th Edn., Sweet & Maxwell, 1990).
Dealing with the question of “clean hands” the learned author
opined that where the plaintiff is shown to have materially misled
the court or to have abused its process, or to have attempted to
do so, the discretionary relief of specific performance can be
denied to him. In laying down this principle, the learned author
relied on a decision of the English Court
in Armstrong v. Sheppard & Short Ltd. [(1959) 2 QB 384 :
(1959) 3 WLR 84 : (1959) 2 All ER 651 (CA)] , QB at p. 397.
(See Spry, Equitable Remedies, p. 243.)

60. This Court has also taken the same view in Arunima
Baruah v. Union of India [(2007) 6 SCC 120] . At p. 125, para
12 of the Report, this Court held that it is trite law that to enable
the court to refuse to exercise its discretionary jurisdiction
suppression must be of a material fact. This Court, of course,
held that what is a material fact, suppression whereof would
disentitle the suitor to obtain a discretionary relief, would depend
upon the facts and circumstances of each case. However, by way
of guidance this Court held that a material fact would mean that
fact which is material for the purpose of determination of the lis.

61. Following the aforesaid tests, this Court is of the opinion that
the suppression of the fact that the plaintiff refused to accept the
cheque of Rs 10 lakhs sent to it by the defendant under registered
post with acknowledgment due in terms of Clause 9 of the
contract is a material fact. So on that ground the plaintiff
purchaser is not entitled to any relief in its suit for specific
performance.”
SLP (C) No.28460 of 2024 Page 21 of 22

CONCLUSION
30. Keeping in view the aforesaid findings, this Court is of the view that
the Agreement to Sell cannot be specifically enforced. Accordingly, the
th
present appeal is allowed and the impugned Judgment dated 27 April,
th th
2018 as well as decrees dated 10 May, 2018 and 09 May, 2024 are set
aside. Further, the sale deed executed in favour of Respondent No.1-buyer
in pursuance of the impugned judgments is declared as null and void and
the Appellant is directed to refund the balance sale consideration amount of
Rs.24,61,000/- (Rupees Twenty Four Lakh Sixty One Thousand) deposited
by Respondent No.1-buyer in pursuance to the impugned judgment and
decrees.

...…...……………….J.
[DIPANKAR DATTA]



……………….J.
[MANMOHAN ]

New Delhi;
April 04, 2025.
SLP (C) No.28460 of 2024 Page 22 of 22