Full Judgment Text
REPORTABLE
2026 INSC 339
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 109 OF 2010
RUSSI FISHERIES P. LTD. & ANR. …APPELLANT(S)
VERSUS
BHAVNA SETH & ORS. …RESPONDENT(S)
J U D G M E N T
PANKAJ MITHAL, J.
1. This is an appeal arising from a suit for specific performance of
an agreement to sell.
2. The said suit for specific performance was dismissed with the
alternative relief of refund of the admitted amount paid in
advance with interest. The decree passed by the court of first
instance was reversed in first appeal which judgment and order
has been upheld by the High Court in Second Appeal.
Signature Not Verified
Digitally signed by
GEETA AHUJA
Date: 2026.04.09
16:51:49 IST
Reason:
1
3. One Anil Kishore Seth (since deceased) now represented by his
1
heirs and legal representatives entered into an Agreement
2
dated 18.07.1988 with Russi Fisheries (P) Ltd. through its
3
Managing Director Smt. Surjit Kavaljit Singh to purchase
agricultural land admeasuring 79 Kanals 15 Marlas for a total
sale consideration of Rs. 15,41,000/-.
4. The aforesaid agreement to sell was executed by defendant
No.1 through its Managing Director, defendant No.2 and was
4
attested inter alia by her son Sanjit Kumar Singh . The
aforesaid agreement is an unregistered agreement but as the
same was not denied, it was marked as an Exhibit.
5. Under the agreement, time was the essence of the contract and
the sale deed was to be executed by 15.12.1988. The time for
execution of the sale deed was twice extended and the last
extended time was up to 30.06.1989.
6. It is alleged that on the last date of the extended time i.e.
30.06.1989, the plaintiff attended the office of the Sub-
Registrar with the balance sale consideration to get the sale
1
Hereinafter referred to as the ‘plaintiff(s)’
2
Hereinafter referred to as ‘defendant No. 1’
3
Hereinafter referred to as ‘defendant No. 2’
4
Hereinafter referred to as ‘defendant No. 3’
2
deed executed but no one appeared on behalf of the defendants
to execute the sale deed. Accordingly, after service of notice, the
plaintiff instituted Civil Suit No. 985/1989 for specific
performance of the agreement to sell dated 18.07.1988
contending inter alia that under the agreement the total sale
consideration agreed was Rs. 15,41,000/- out of which Rs.
75,000/- was paid by cheque as earnest money; 2,00,000/- by
cheque on 11.11.1988 to the defendant Nos. 2 and 3;
thereafter, a sum of Rs. 2,00,000/- was paid on 01.12.1988 in
cash to the defendant No. 3 and again a sum of Rs. 3,00,000/-
on 20.12.1988 to the defendant No. 3 when the time for
execution of sale deed was first extended to 31.01.1989. In this
way, the plaintiff allegedly paid Rs. 2,75,000/- by cheque and
Rs. 5,00,000/- in cash, totaling Rs. 7,75,000/-, and the
balance was payable at the time of execution of the sale deed.
He contended that he was always ready and willing to get the
sale deed executed and to perform his part of the agreement.
7. Defendant Nos.1, 2 and 3 all filed appearance but the suit was
contested by Defendant Nos. 1 & 2 only by filing a joint written
statement. They admitted the agreement to sell and the receipt
3
of Rs. 2,75,000/- through cheque as part of the sale
consideration but denied receiving the cash payment and that
the plaintiffs were never ready and willing to fulfill their part of
the agreement. They further stated that Defendant No. 3 was
not authorized to receive any payment on behalf of the
defendant No. 1 as he was merely an attesting witness to the
agreement.
8. The court of first instance dismissed the suit for specific
performance on 10.12.1999 by holding that the plaintiff failed
to prove his continuous readiness and willingness to perform
his part of the contract, but decreed it for the refund of sale
consideration of Rs. 2,75,000/-, admitted to have been paid in
cheques with interest @ 12% per annum.
9. Aggrieved by the aforesaid judgment and order, the heirs of the
plaintiff preferred an appeal which was allowed on 23.04.2003
holding that the plaintiff had paid Rs. 7,75,000/- and since he
attended the office of the Sub-Registrar on 30.06.1989, he was
ready and willing to perform his part of the agreement and as
such is entitled to a decree of specific performance.
4
10. On Second Appeal being preferred on behalf of the defendants,
the judgment passed by the first appellate court was upheld.
Thus, the decree of the specific performance as passed in first
appeal was maintained.
11. The decree of specific performance passed by the first appellate
court and as upheld by the High Court in Second Appeal was
challenged by the defendants by filing a Special Leave Petition
on 20.08.2009 before this Court which was duly entertained by
granting leave on 08.01.2010 with an interim order, as prayed
for. Therefore, this appeal is before us.
12. Despite the fact that the leave was granted in the SLP and an
interim order was also passed, the heirs of plaintiff through the
process of the Court on the same very day i.e., 08.01.2010 got
the sale deed executed in their favour on the strength of the
decree of specific performance passed by the first appellate
court as affirmed in second appeal.
13. It is also pertinent to mention that the defendants sold 60
percent of the suit land on 12.02.2009 i.e., even before the SLP
was filed but during the pendency of the litigation. The
remaining 40 percent of the land was sold by them during the
5
pendency of this appeal on 27.02.2025. Therefore, though on
the one hand there is a sale deed in favour of the plaintiffs of
the suit land, the same also stands transferred to third parties
by the defendants during the pendency of the litigation.
14. In the background of the above transfers of the suit land made
by the parties, one of the points before this Court would be as
to the effect and impact of the above transfers on the outcome
of the suit itself.
15. We have heard Shri K. Parameshwar, learned senior counsel
for the defendants and Shri Pawanjit Singh Bindra, learned
senior counsel for the substituted plaintiffs.
16. Shri K. Parameshwar, learned senior counsel appearing for the
defendants, at the very outset, tenders unconditional apology
for not disclosing the fact of execution of the sale deeds dated
12.02.2009 and 27.02.2025, transferring the said land to third
parties and submits that such an omission in the pleadings
had occurred only on account of improper advice and the fact
that the sale, if any, made would be subject to the doctrine of
lis pendens . There was no oblique motive or any deliberate
concealment on the part of the defendants. Further, the sale
6
deeds so executed are not void ab initio but are subject to the
decision of this appeal. In this connection, he relied upon.
17. It is worth noting that the aforesaid transfers have been made
during the pendency of the litigation and therefore, the same
would be governed by the principle of lis pendens as enshrined
under Section 52 of the TP Act and the said transfers have to
abide by the ultimate decree to be passed in this appeal. In this
connection, reliance has been placed upon Thomson Press
5
(India) Ltd. vs Nanak Builders & Investors (P) Ltd , wherein
the Division Bench held that transfer pendente lite is neither
illegal nor void ab initio but remains subservient to the rights
of the parties eventually determined by court in the pending
litigation. In view of the above, whatever transfers have been
made pending the litigation or this appeal would follow the
decision passed in this appeal. Therefore, in the facts, we
ignore the omission and proceed on the merits.
18. On merits, Shri K. Parameshwar submits that the grant of relief
of specific performance of an agreement to sell is an equitable
and a discretionary relief. The agreement to sell is dated
5
(2013) 5 SCC 397
7
18.07.1988 and the first appellate court had decreed the suit
on 23.04.2003. In between, there was immense increase of
price of the land and as such it became unequitable with the
passage of time to grant the relief of specific performance of the
agreement. In view of the above, he submits it is not justified
to uphold the decree after such a long distance of time from the
date of the agreement. It would be highly unequitable to the
defendants.
19. He next submitted that the plaintiff had not entered into the
witness box to prove the plaint allegations despite the fact that
he was alive until 13.05.1996 and had the opportunity before
the court of first instance to appear and testify. In the absence
of any proof of pleadings contained in the plaint, the suit could
not have been decreed on the basis of the testimony of other
witnesses.
20. He further submitted that the plaintiff had only paid a sum of
Rs.2,75,000/- through cheques and thereafter, there was no
payment in favour of the defendant no.1-company. The cash
payment of Rs.2,00,000/- plus Rs.3,00,000/- totaling
Rs.5,00,000/- alleged to have been paid to the defendant no.3
8
would not enure to the benefit of defendant nos.1 i.e., the
Company inasmuch as defendant no.3 who allegedly accepted
the cash payment was never examined as a witness and also
had no authority to receive the same on behalf of the company.
21. Shri K. Parameshwar further submitted that the plaintiff was
never ready and willing to perform his part of the agreement
inasmuch as under the agreement dated 18.07.1988, time was
the essence of the contract and the sale deed was to be
executed on or before 15.12.1988. Further, the defendants
have not permitted any extension of time and even if the last
extended period is treated to be up to 30.06.1989, the plaintiff
had not given any notice requiring the defendants to appear
before the office of Sub-Registrar for the execution of the sale
deed. The defendants categorically denied receiving the notices
dated 13.06.1989 and 22.06.1989 alleged to have been issued
by the plaintiff in this connection.
22. In addition to the above, he submitted that there is no evidence
to prove that the plaintiff attended the office of the sub-
Registrar on 30.06.1989. The testimony of PW-4 in this
connection, is not admissible as there is no document or
9
pleading to verify PW-4’s involvement. Further, PW-1, the clerk
of the office of the Sub-Registrar had not and could not have
proved the signatures of the Sub-Registrar as he was not in the
office of Sub-Registrar in 1989 and had no personal knowledge
of the events. Therefore, there was no continuous readiness
and willingness on part of the plaintiff to carry out his
obligation under the agreement.
23. Lastly, Shri K. Parameshwar submitted that the suit for specific
performance as filed by the plaintiff was dismissed by the court
of first instance which decree was reversed by the first appellate
court. As such, there were two contrary judgments recording
conflicting findings on the facts as regards to the payment of
part of the sale consideration as well as on readiness and
willingness of the plaintiff. This being the position, the High
Court was not justified in dismissing the second appeal only on
the ground that it raises no substantial question of law by
simply stating that the findings recorded by the First Appellate
Court are correct in view of the testimony of PW-1 and PW-4
but without even considering the statements of the said
10
witnesses which do not actually prove what has been held by
the first appellate court.
24. Shri Bindra, learned senior counsel on behalf of the plaintiff
has strongly opposed all the arguments advanced on behalf of
the defendants aforesaid. He contends that the agreement to
sell is an admitted document which bears the signatures of
both the parties. The cash payment receipts are duly signed by
the defendant no.3 and stood proved by the handwriting
expert. Moreover, the receipts clearly states that the cash
payment is being received on behalf of the defendant no.1 -
company. This sufficiently proves the cash transactions.
25. Secondly, he submits that even on the letters of extension of
time, there are signatures of the defendant no.2 – the Managing
Director of the Company which have not been denied by her
rather accepted in her cross-examination and further identified
and proved by the expert.
26. Shri Bindra further submits that the plaintiff had given due
notice not one but two, dated 13.06.1989 and 22.06.1989
calling upon the defendants to attend the office of Sub-
Registrar for the execution of the sale deed. The defendants
11
were actually aware of the last date fixed for the execution of
the sale deed and as such they were obliged to attend the office
of the Sub-Registrar which they failed to do. The plaintiff has
proved his attendance on the said date before the Sub-registrar
by moving an application which was duly accepted, signed and
stamped by the Sub-Registrar. There is no contrary evidence to
belie the said document.
27. Lastly, he submits that non-appearance of the plaintiff in the
witness box is not fatal to the suit as his Manager, PW-4 has
appeared as a witness and has proved the entire transactions
as he was working with him since before the execution of the
agreement.
28. In the end, he sums up by saying that the findings of fact
recorded by the First Appellate Court are not perverse and are
final. Therefore, there was no occasion for the Second Appellate
Court to re-appraise the evidence to examine the correctness of
the same. He further contends that once a sale deed dated
08.01.2010 had already been executed pursuant to the decree
of the First Appellate Court which has been upheld in second
appeal, there is no equity in favour of the defendants to get the
12
said sale deed reversed or set aside, rather in view of the said
sale deed, the sale deeds executed by the defendants are void
and non est .
29. In the instant case, though an issue was raised before the
Court of First Instance as to the valid existence of the
agreement to sell dated 18.07.1988, the said issue upon
consideration of the evidence adduced by the parties was
decided in favour of the plaintiffs but the suit was dismissed
for the relief of specific performance. Against the said finding,
the defendants have not filed any cross-objections in the appeal
preferred by the plaintiff. The said finding was accepted even
by the First Appellate Court and the suit for specific
performance was decreed. The defendants preferred second
appeal but never assailed the finding with regard to existence
of the agreement. No argument in this regard was raised, thus,
conceding that there exists a valid agreement to sell. In this
view of the matter, the existence of the valid agreement to sell
dated 18.07.1988 is no longer in dispute. Since, the said
agreement is acceptable to both the parties and has been
marked as an Exhibit, the question as to whether it was
13
unenforceable in law for want of registration loses all
significance and need not be gone into by us.
30. No doubt, the relief of specific performance was not granted by
the Court of First Instance and only the alternative relief to
refund the cheque amount of Rs.2,75,000/- paid in advance
was granted, nonetheless, the findings recorded by the First
Court were reversed by the Court of First Appeal and
categorical findings were recorded that the plaintiffs have
proved the extension of time for the execution of the sale deed,
the cash payment of Rs.5,00,000/- and that the plaintiff was
always ready and willing to get the sale deed executed within
time. These findings are strictly findings of facts and are not
shown to be perverse in any manner. They have not been
returned on the basis of any inadmissible evidence. Therefore,
in such a situation it was not open for the Second Appellate
Court to go into the correctness of those findings by
reappreciating the evidence adduced by the parties.
31. It is settled in law that the findings of fact howsoever erroneous,
cannot be reopened and disturbed in second appeal which is
required to be adjudicated only upon the substantial question
14
of law, if any, arising therein. Thus, the argument that the High
Court in second appeal ought to have examined the evidence
to ensure the correctness of the findings of the First Appellate
Court has no legs to stand and fails.
32. Long back in 1981, three judges of this Court in the case of
6
Bholaram vs. Ameerchand had ruled that even if findings of
facts by courts below are wrong or grossly inexcusable that by
itself would not entitle the High Court to interfere under
Section 100 CPC in the absence of clear error of law. A similar
view was reiterated in Madhavan Nair vs. Bhaskar Pillai
7
(Dead) by Lrs. , wherein it has been laid down that even if the
First Appellate Court commits an error in recording a finding
of fact, that itself will not be a ground for the High Court to
upset the same.
33. In Kashibai w/o Lachiram and Another vs. Parwatibai w/o
8
Lachiram and others , a similar proposition of law was laid
down by this Court and it was held that the High Court cannot
reappreciate the evidence and interfere with the findings of
6
(1981) 2 SCC 414
7
(2005) 10 SCC 553
8
(1995) 6 SCC 213
15
facts unless a substantial question of law or a question of law
duly formulated is to be decided. The second appeal does not
lie on the ground of erroneous findings of facts based on
appreciation of the relevant evidence.
34. Similar is the situation in the case at hand. The High Court has
not found any substantial question of law or a question of law
worth consideration in the second appeal and, therefore, there
was no occasion for it to have reappreciated the evidence so as
to come to a different conclusion.
35. Again, in Kulwant Kaur and Others vs. Gurdial Singh Mann
9
(Dead) by Lrs and Others , it was emphasized that the fact
remains that in a second appeal, a finding of fact, even if
erroneous, will not be disturbed unless it is found that it stands
vitiated for want of perversity. No such case for interference has
been made out in the present case.
36. Even if we examine the evidence on record for the satisfaction
of the defendants, we find that the parties have mutually
agreed for the grant of extension of time to execute the sale
deed despite time being the essence of the agreement. The
9
AIR (2001) SC 1273
16
documents showing extension of time, two of which bear the
signatures of not only the defendant no.3 but also that of
defendant no.2 – the Managing Director of the Company –
defendant no.1. Significantly, defendant no.2, while appearing
as DW-1, has admitted her signatures on the agreement as well
as on other relevant documents, and has also acknowledged
that the last date of execution was extended till 30.06.1989. No
concrete or reliable evidence has been adduced to prove that
the extension of time was granted without taking her consent.
Further, the handwriting expert also corroborated the
genuineness of the disputed signatures. Therefore, the finding
of the First Appellate Court on the above score does not suffer
from any material illegality.
37. Secondly, the cash payment was made to the defendant no.3
who is none other than the son of defendant no.2 - the
Managing Director of the Company – defendant no.1. In the
receipts issued by him, he has categorically stated that he is
accepting payment on behalf of the company in the capacity of
being its Director and was authorized to receive the same. The
narration in the receipts that he is receiving payment on behalf
17
of the Company-defendant no.1 as the Director, has not been
denied by him as he never stepped into the witness box. No
evidence was brought on record to establish that he was not
the Director of the Company-defendant no.1. The submission
that the said receipts were in relation to some other
transactions does not stand established by any evidence
adduced by the defendants. Therefore, the finding of the First
Appellate Court in this connection is justified.
38. Lastly, the period of execution of the sale deed as last extended
was expiring on 30.06.1989. Therefore, the defendants were
under an obligation to show that they were also ready and
willing to execute the sale deed on or before the said date.
However, there is no positive evidence from their side to prove
discharge of their obligation. On the other hand, the plaintiffs
have issued notices dated 13.06.1989 and 22.06.1989 to the
defendants to attend the office of the Sub-Registrar on
30.06.1989 for the execution of the sale deed as that was the
last day for executing the same. No doubt, the said notices were
sent to the defendants under certificate of posting, which
proves that the notices were dispatched. Although, that may
18
not be conclusive evidence regarding their service, simply
denying receiving the notices would not mean that the notices
were not served, as it is not the allegation of the defendants
that they were not sent to the proper address. The defendants
have not adduced any evidence to prove that they were not
actually served with the said notices. The allegation in this
regard by them is only a bald allegation.
39. The plaintiff after giving the aforesaid notice had attended the
office of the of the Sub-Registrar on 30.06.1989 which stand
proved by his application submitted to the Sub-Registrar on
the said very date. The application clearly states that he has
come prepared and ready with the balance sale consideration
to get the sale deed executed. The receipt of the said application
in the office of Sub-Registrar with the stamp of the office of the
Sub-Registrar is duly proved by the evidence of the PW-1. The
mere fact that he has not proved the signatures of the Sub-
Registrar is not sufficient to belie the above document when the
submission of the application and the stamp of the Sub-
Registrar stand proved. Moreover, there is no denial of the fact
or evidence by the defendants that the contents of the
19
application are incorrect and that the plaintiff had not attended
the office with the necessary finances so as to get the sale deed
executed. The submission that no proof of possessing such
finance was produced is not material when the allegation in the
application that the plaintiff has come prepared with the
necessary funds is not sufficiently denied.
40. In view of the aforesaid facts and circumstances, the findings
as returned by the First Appellate Court on readiness and
willingness, extension of time and payment of cash money are
not perverse and illegal, which may warrant any interference.
41. Now, the crucial issue which remains is about the effect of non-
appearance of the plaintiff in the witness box to prove his plaint
case. It is an admitted position that the plaintiff himself has
not entered the witness box and has not offered himself to be
cross-examined. In such a situation, a presumption can always
be drawn against him that the case, as pleaded by him, is not
correct. In this connection, a reference can be made to the
decision of this Court in the case of Vidhyadhar vs Manikrao
10
and Another , which lays down that where a party does not
10
(1999) 3 SCC 573
20
appear in the witness box, a presumption would arise that the
case set up by him is not correct. This Court in laying down as
aforesaid has referred to various decisions of the High Court.
The decisions of the High Court are also to the effect that when
a party fails to appear as a witness, it gives rise to an adverse
inference and nothing more.
42. The adverse presumption, if any, drawn for non-appearing in
the witness box by the plaintiff, is a rebuttal presumption and
if the aforesaid presumption is successfully rebutted by the
other cogent evidence on record, the said presumption would
not be material and applicable. In the present case, PW-4, the
Manager of the plaintiff, had appeared as a witness. He has
stated that he had been working with the plaintiff since 1988
and had the knowledge of all the transactions in relation to the
agreement to sell dated 18.07.1988. His testimony
substantially corroborates the case as set up by the plaintiff in
the plaint, including execution of agreement, payment of
consideration and extension of time. Therefore, in the light of
the evidence of the PW-4, the plaint allegations stand
corroborated. The adverse inference drawn on account of non-
21
appearance of the plaintiff stands rebutted by his evidence and
other evidence on record. In these circumstances, the non-
appearance of the plaintiff in the witness box would not be fatal
in this case.
43. In the recent case of Rajesh Kumar vs Anand Kumar and
11
Others in which one of us (P. Mithal, J) was a party, relying
upon Janki Vashdeo Bhojwani and Another vs Indusind
12
Bank Ltd. and Other , it was held that a power of attorney
holder may depose on behalf of the principal in respect of such
acts which are within his personal knowledge but he cannot
certainly depose for the principal, for the acts done by the
principal and not known personally by him. Applying the same
analogy, the Manager, PW-4 herein had deposed about the
entire transaction based upon his personal knowledge as he
was attached to the plaintiff as the Manager. In such
circumstances, his evidence cannot be discarded.
44. This takes us to the last limb of the argument of the parties
with regard to the equitable and discretionary jurisdiction of
the court to grant the relief of specific performance. No doubt,
11
(2024) 13 SCC 80
12
(2005) 2 SCC 217
22
the agreement to sell was executed on 18.07.1988 and the
decree of specific performance was passed by the First
Appellate Court on 23.04.2003, after a gap of 15 years, no
evidence whatsoever was brought on record to establish that
within this period the price of property in the area had
escalated, making it inequitable to grant the decree of specific
performance.
45. The sale deeds executed by the defendants during the
pendency of the litigation are certainly hit by doctrine of lis
pendens and are non est. At the same time, the plaintiffs have
got the sale deed of the suit land executed in their favour by
following the due process of law on the basis of the decree of
specific performance granted in their favour by the First
Appellate Court. In such circumstances when the decree has
already been executed and substantive rights have accrued in
favour of the heirs of the plaintiff, it would be inequitable to
dislodge them from the benefit of the sale in exercise of
discretionary jurisdiction.
46. Accordingly, in the facts and circumstances of the case, we find
no merit in this appeal and the same is dismissed. The sale
23
deeds executed by the defendants on 12.02.2009 and
27.02.2025 are held to be non est and the decree as passed by
the First Appellate Court is maintained.
...................………………………….. J.
(PANKAJ MITHAL)
.............……………………………….. J.
(PRASANNA.B. VARALE)
NEW DELHI;
APRIL 09, 2026.
24
2026 INSC 339
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 109 OF 2010
RUSSI FISHERIES P. LTD. & ANR. …APPELLANT(S)
VERSUS
BHAVNA SETH & ORS. …RESPONDENT(S)
J U D G M E N T
PANKAJ MITHAL, J.
1. This is an appeal arising from a suit for specific performance of
an agreement to sell.
2. The said suit for specific performance was dismissed with the
alternative relief of refund of the admitted amount paid in
advance with interest. The decree passed by the court of first
instance was reversed in first appeal which judgment and order
has been upheld by the High Court in Second Appeal.
Signature Not Verified
Digitally signed by
GEETA AHUJA
Date: 2026.04.09
16:51:49 IST
Reason:
1
3. One Anil Kishore Seth (since deceased) now represented by his
1
heirs and legal representatives entered into an Agreement
2
dated 18.07.1988 with Russi Fisheries (P) Ltd. through its
3
Managing Director Smt. Surjit Kavaljit Singh to purchase
agricultural land admeasuring 79 Kanals 15 Marlas for a total
sale consideration of Rs. 15,41,000/-.
4. The aforesaid agreement to sell was executed by defendant
No.1 through its Managing Director, defendant No.2 and was
4
attested inter alia by her son Sanjit Kumar Singh . The
aforesaid agreement is an unregistered agreement but as the
same was not denied, it was marked as an Exhibit.
5. Under the agreement, time was the essence of the contract and
the sale deed was to be executed by 15.12.1988. The time for
execution of the sale deed was twice extended and the last
extended time was up to 30.06.1989.
6. It is alleged that on the last date of the extended time i.e.
30.06.1989, the plaintiff attended the office of the Sub-
Registrar with the balance sale consideration to get the sale
1
Hereinafter referred to as the ‘plaintiff(s)’
2
Hereinafter referred to as ‘defendant No. 1’
3
Hereinafter referred to as ‘defendant No. 2’
4
Hereinafter referred to as ‘defendant No. 3’
2
deed executed but no one appeared on behalf of the defendants
to execute the sale deed. Accordingly, after service of notice, the
plaintiff instituted Civil Suit No. 985/1989 for specific
performance of the agreement to sell dated 18.07.1988
contending inter alia that under the agreement the total sale
consideration agreed was Rs. 15,41,000/- out of which Rs.
75,000/- was paid by cheque as earnest money; 2,00,000/- by
cheque on 11.11.1988 to the defendant Nos. 2 and 3;
thereafter, a sum of Rs. 2,00,000/- was paid on 01.12.1988 in
cash to the defendant No. 3 and again a sum of Rs. 3,00,000/-
on 20.12.1988 to the defendant No. 3 when the time for
execution of sale deed was first extended to 31.01.1989. In this
way, the plaintiff allegedly paid Rs. 2,75,000/- by cheque and
Rs. 5,00,000/- in cash, totaling Rs. 7,75,000/-, and the
balance was payable at the time of execution of the sale deed.
He contended that he was always ready and willing to get the
sale deed executed and to perform his part of the agreement.
7. Defendant Nos.1, 2 and 3 all filed appearance but the suit was
contested by Defendant Nos. 1 & 2 only by filing a joint written
statement. They admitted the agreement to sell and the receipt
3
of Rs. 2,75,000/- through cheque as part of the sale
consideration but denied receiving the cash payment and that
the plaintiffs were never ready and willing to fulfill their part of
the agreement. They further stated that Defendant No. 3 was
not authorized to receive any payment on behalf of the
defendant No. 1 as he was merely an attesting witness to the
agreement.
8. The court of first instance dismissed the suit for specific
performance on 10.12.1999 by holding that the plaintiff failed
to prove his continuous readiness and willingness to perform
his part of the contract, but decreed it for the refund of sale
consideration of Rs. 2,75,000/-, admitted to have been paid in
cheques with interest @ 12% per annum.
9. Aggrieved by the aforesaid judgment and order, the heirs of the
plaintiff preferred an appeal which was allowed on 23.04.2003
holding that the plaintiff had paid Rs. 7,75,000/- and since he
attended the office of the Sub-Registrar on 30.06.1989, he was
ready and willing to perform his part of the agreement and as
such is entitled to a decree of specific performance.
4
10. On Second Appeal being preferred on behalf of the defendants,
the judgment passed by the first appellate court was upheld.
Thus, the decree of the specific performance as passed in first
appeal was maintained.
11. The decree of specific performance passed by the first appellate
court and as upheld by the High Court in Second Appeal was
challenged by the defendants by filing a Special Leave Petition
on 20.08.2009 before this Court which was duly entertained by
granting leave on 08.01.2010 with an interim order, as prayed
for. Therefore, this appeal is before us.
12. Despite the fact that the leave was granted in the SLP and an
interim order was also passed, the heirs of plaintiff through the
process of the Court on the same very day i.e., 08.01.2010 got
the sale deed executed in their favour on the strength of the
decree of specific performance passed by the first appellate
court as affirmed in second appeal.
13. It is also pertinent to mention that the defendants sold 60
percent of the suit land on 12.02.2009 i.e., even before the SLP
was filed but during the pendency of the litigation. The
remaining 40 percent of the land was sold by them during the
5
pendency of this appeal on 27.02.2025. Therefore, though on
the one hand there is a sale deed in favour of the plaintiffs of
the suit land, the same also stands transferred to third parties
by the defendants during the pendency of the litigation.
14. In the background of the above transfers of the suit land made
by the parties, one of the points before this Court would be as
to the effect and impact of the above transfers on the outcome
of the suit itself.
15. We have heard Shri K. Parameshwar, learned senior counsel
for the defendants and Shri Pawanjit Singh Bindra, learned
senior counsel for the substituted plaintiffs.
16. Shri K. Parameshwar, learned senior counsel appearing for the
defendants, at the very outset, tenders unconditional apology
for not disclosing the fact of execution of the sale deeds dated
12.02.2009 and 27.02.2025, transferring the said land to third
parties and submits that such an omission in the pleadings
had occurred only on account of improper advice and the fact
that the sale, if any, made would be subject to the doctrine of
lis pendens . There was no oblique motive or any deliberate
concealment on the part of the defendants. Further, the sale
6
deeds so executed are not void ab initio but are subject to the
decision of this appeal. In this connection, he relied upon.
17. It is worth noting that the aforesaid transfers have been made
during the pendency of the litigation and therefore, the same
would be governed by the principle of lis pendens as enshrined
under Section 52 of the TP Act and the said transfers have to
abide by the ultimate decree to be passed in this appeal. In this
connection, reliance has been placed upon Thomson Press
5
(India) Ltd. vs Nanak Builders & Investors (P) Ltd , wherein
the Division Bench held that transfer pendente lite is neither
illegal nor void ab initio but remains subservient to the rights
of the parties eventually determined by court in the pending
litigation. In view of the above, whatever transfers have been
made pending the litigation or this appeal would follow the
decision passed in this appeal. Therefore, in the facts, we
ignore the omission and proceed on the merits.
18. On merits, Shri K. Parameshwar submits that the grant of relief
of specific performance of an agreement to sell is an equitable
and a discretionary relief. The agreement to sell is dated
5
(2013) 5 SCC 397
7
18.07.1988 and the first appellate court had decreed the suit
on 23.04.2003. In between, there was immense increase of
price of the land and as such it became unequitable with the
passage of time to grant the relief of specific performance of the
agreement. In view of the above, he submits it is not justified
to uphold the decree after such a long distance of time from the
date of the agreement. It would be highly unequitable to the
defendants.
19. He next submitted that the plaintiff had not entered into the
witness box to prove the plaint allegations despite the fact that
he was alive until 13.05.1996 and had the opportunity before
the court of first instance to appear and testify. In the absence
of any proof of pleadings contained in the plaint, the suit could
not have been decreed on the basis of the testimony of other
witnesses.
20. He further submitted that the plaintiff had only paid a sum of
Rs.2,75,000/- through cheques and thereafter, there was no
payment in favour of the defendant no.1-company. The cash
payment of Rs.2,00,000/- plus Rs.3,00,000/- totaling
Rs.5,00,000/- alleged to have been paid to the defendant no.3
8
would not enure to the benefit of defendant nos.1 i.e., the
Company inasmuch as defendant no.3 who allegedly accepted
the cash payment was never examined as a witness and also
had no authority to receive the same on behalf of the company.
21. Shri K. Parameshwar further submitted that the plaintiff was
never ready and willing to perform his part of the agreement
inasmuch as under the agreement dated 18.07.1988, time was
the essence of the contract and the sale deed was to be
executed on or before 15.12.1988. Further, the defendants
have not permitted any extension of time and even if the last
extended period is treated to be up to 30.06.1989, the plaintiff
had not given any notice requiring the defendants to appear
before the office of Sub-Registrar for the execution of the sale
deed. The defendants categorically denied receiving the notices
dated 13.06.1989 and 22.06.1989 alleged to have been issued
by the plaintiff in this connection.
22. In addition to the above, he submitted that there is no evidence
to prove that the plaintiff attended the office of the sub-
Registrar on 30.06.1989. The testimony of PW-4 in this
connection, is not admissible as there is no document or
9
pleading to verify PW-4’s involvement. Further, PW-1, the clerk
of the office of the Sub-Registrar had not and could not have
proved the signatures of the Sub-Registrar as he was not in the
office of Sub-Registrar in 1989 and had no personal knowledge
of the events. Therefore, there was no continuous readiness
and willingness on part of the plaintiff to carry out his
obligation under the agreement.
23. Lastly, Shri K. Parameshwar submitted that the suit for specific
performance as filed by the plaintiff was dismissed by the court
of first instance which decree was reversed by the first appellate
court. As such, there were two contrary judgments recording
conflicting findings on the facts as regards to the payment of
part of the sale consideration as well as on readiness and
willingness of the plaintiff. This being the position, the High
Court was not justified in dismissing the second appeal only on
the ground that it raises no substantial question of law by
simply stating that the findings recorded by the First Appellate
Court are correct in view of the testimony of PW-1 and PW-4
but without even considering the statements of the said
10
witnesses which do not actually prove what has been held by
the first appellate court.
24. Shri Bindra, learned senior counsel on behalf of the plaintiff
has strongly opposed all the arguments advanced on behalf of
the defendants aforesaid. He contends that the agreement to
sell is an admitted document which bears the signatures of
both the parties. The cash payment receipts are duly signed by
the defendant no.3 and stood proved by the handwriting
expert. Moreover, the receipts clearly states that the cash
payment is being received on behalf of the defendant no.1 -
company. This sufficiently proves the cash transactions.
25. Secondly, he submits that even on the letters of extension of
time, there are signatures of the defendant no.2 – the Managing
Director of the Company which have not been denied by her
rather accepted in her cross-examination and further identified
and proved by the expert.
26. Shri Bindra further submits that the plaintiff had given due
notice not one but two, dated 13.06.1989 and 22.06.1989
calling upon the defendants to attend the office of Sub-
Registrar for the execution of the sale deed. The defendants
11
were actually aware of the last date fixed for the execution of
the sale deed and as such they were obliged to attend the office
of the Sub-Registrar which they failed to do. The plaintiff has
proved his attendance on the said date before the Sub-registrar
by moving an application which was duly accepted, signed and
stamped by the Sub-Registrar. There is no contrary evidence to
belie the said document.
27. Lastly, he submits that non-appearance of the plaintiff in the
witness box is not fatal to the suit as his Manager, PW-4 has
appeared as a witness and has proved the entire transactions
as he was working with him since before the execution of the
agreement.
28. In the end, he sums up by saying that the findings of fact
recorded by the First Appellate Court are not perverse and are
final. Therefore, there was no occasion for the Second Appellate
Court to re-appraise the evidence to examine the correctness of
the same. He further contends that once a sale deed dated
08.01.2010 had already been executed pursuant to the decree
of the First Appellate Court which has been upheld in second
appeal, there is no equity in favour of the defendants to get the
12
said sale deed reversed or set aside, rather in view of the said
sale deed, the sale deeds executed by the defendants are void
and non est .
29. In the instant case, though an issue was raised before the
Court of First Instance as to the valid existence of the
agreement to sell dated 18.07.1988, the said issue upon
consideration of the evidence adduced by the parties was
decided in favour of the plaintiffs but the suit was dismissed
for the relief of specific performance. Against the said finding,
the defendants have not filed any cross-objections in the appeal
preferred by the plaintiff. The said finding was accepted even
by the First Appellate Court and the suit for specific
performance was decreed. The defendants preferred second
appeal but never assailed the finding with regard to existence
of the agreement. No argument in this regard was raised, thus,
conceding that there exists a valid agreement to sell. In this
view of the matter, the existence of the valid agreement to sell
dated 18.07.1988 is no longer in dispute. Since, the said
agreement is acceptable to both the parties and has been
marked as an Exhibit, the question as to whether it was
13
unenforceable in law for want of registration loses all
significance and need not be gone into by us.
30. No doubt, the relief of specific performance was not granted by
the Court of First Instance and only the alternative relief to
refund the cheque amount of Rs.2,75,000/- paid in advance
was granted, nonetheless, the findings recorded by the First
Court were reversed by the Court of First Appeal and
categorical findings were recorded that the plaintiffs have
proved the extension of time for the execution of the sale deed,
the cash payment of Rs.5,00,000/- and that the plaintiff was
always ready and willing to get the sale deed executed within
time. These findings are strictly findings of facts and are not
shown to be perverse in any manner. They have not been
returned on the basis of any inadmissible evidence. Therefore,
in such a situation it was not open for the Second Appellate
Court to go into the correctness of those findings by
reappreciating the evidence adduced by the parties.
31. It is settled in law that the findings of fact howsoever erroneous,
cannot be reopened and disturbed in second appeal which is
required to be adjudicated only upon the substantial question
14
of law, if any, arising therein. Thus, the argument that the High
Court in second appeal ought to have examined the evidence
to ensure the correctness of the findings of the First Appellate
Court has no legs to stand and fails.
32. Long back in 1981, three judges of this Court in the case of
6
Bholaram vs. Ameerchand had ruled that even if findings of
facts by courts below are wrong or grossly inexcusable that by
itself would not entitle the High Court to interfere under
Section 100 CPC in the absence of clear error of law. A similar
view was reiterated in Madhavan Nair vs. Bhaskar Pillai
7
(Dead) by Lrs. , wherein it has been laid down that even if the
First Appellate Court commits an error in recording a finding
of fact, that itself will not be a ground for the High Court to
upset the same.
33. In Kashibai w/o Lachiram and Another vs. Parwatibai w/o
8
Lachiram and others , a similar proposition of law was laid
down by this Court and it was held that the High Court cannot
reappreciate the evidence and interfere with the findings of
6
(1981) 2 SCC 414
7
(2005) 10 SCC 553
8
(1995) 6 SCC 213
15
facts unless a substantial question of law or a question of law
duly formulated is to be decided. The second appeal does not
lie on the ground of erroneous findings of facts based on
appreciation of the relevant evidence.
34. Similar is the situation in the case at hand. The High Court has
not found any substantial question of law or a question of law
worth consideration in the second appeal and, therefore, there
was no occasion for it to have reappreciated the evidence so as
to come to a different conclusion.
35. Again, in Kulwant Kaur and Others vs. Gurdial Singh Mann
9
(Dead) by Lrs and Others , it was emphasized that the fact
remains that in a second appeal, a finding of fact, even if
erroneous, will not be disturbed unless it is found that it stands
vitiated for want of perversity. No such case for interference has
been made out in the present case.
36. Even if we examine the evidence on record for the satisfaction
of the defendants, we find that the parties have mutually
agreed for the grant of extension of time to execute the sale
deed despite time being the essence of the agreement. The
9
AIR (2001) SC 1273
16
documents showing extension of time, two of which bear the
signatures of not only the defendant no.3 but also that of
defendant no.2 – the Managing Director of the Company –
defendant no.1. Significantly, defendant no.2, while appearing
as DW-1, has admitted her signatures on the agreement as well
as on other relevant documents, and has also acknowledged
that the last date of execution was extended till 30.06.1989. No
concrete or reliable evidence has been adduced to prove that
the extension of time was granted without taking her consent.
Further, the handwriting expert also corroborated the
genuineness of the disputed signatures. Therefore, the finding
of the First Appellate Court on the above score does not suffer
from any material illegality.
37. Secondly, the cash payment was made to the defendant no.3
who is none other than the son of defendant no.2 - the
Managing Director of the Company – defendant no.1. In the
receipts issued by him, he has categorically stated that he is
accepting payment on behalf of the company in the capacity of
being its Director and was authorized to receive the same. The
narration in the receipts that he is receiving payment on behalf
17
of the Company-defendant no.1 as the Director, has not been
denied by him as he never stepped into the witness box. No
evidence was brought on record to establish that he was not
the Director of the Company-defendant no.1. The submission
that the said receipts were in relation to some other
transactions does not stand established by any evidence
adduced by the defendants. Therefore, the finding of the First
Appellate Court in this connection is justified.
38. Lastly, the period of execution of the sale deed as last extended
was expiring on 30.06.1989. Therefore, the defendants were
under an obligation to show that they were also ready and
willing to execute the sale deed on or before the said date.
However, there is no positive evidence from their side to prove
discharge of their obligation. On the other hand, the plaintiffs
have issued notices dated 13.06.1989 and 22.06.1989 to the
defendants to attend the office of the Sub-Registrar on
30.06.1989 for the execution of the sale deed as that was the
last day for executing the same. No doubt, the said notices were
sent to the defendants under certificate of posting, which
proves that the notices were dispatched. Although, that may
18
not be conclusive evidence regarding their service, simply
denying receiving the notices would not mean that the notices
were not served, as it is not the allegation of the defendants
that they were not sent to the proper address. The defendants
have not adduced any evidence to prove that they were not
actually served with the said notices. The allegation in this
regard by them is only a bald allegation.
39. The plaintiff after giving the aforesaid notice had attended the
office of the of the Sub-Registrar on 30.06.1989 which stand
proved by his application submitted to the Sub-Registrar on
the said very date. The application clearly states that he has
come prepared and ready with the balance sale consideration
to get the sale deed executed. The receipt of the said application
in the office of Sub-Registrar with the stamp of the office of the
Sub-Registrar is duly proved by the evidence of the PW-1. The
mere fact that he has not proved the signatures of the Sub-
Registrar is not sufficient to belie the above document when the
submission of the application and the stamp of the Sub-
Registrar stand proved. Moreover, there is no denial of the fact
or evidence by the defendants that the contents of the
19
application are incorrect and that the plaintiff had not attended
the office with the necessary finances so as to get the sale deed
executed. The submission that no proof of possessing such
finance was produced is not material when the allegation in the
application that the plaintiff has come prepared with the
necessary funds is not sufficiently denied.
40. In view of the aforesaid facts and circumstances, the findings
as returned by the First Appellate Court on readiness and
willingness, extension of time and payment of cash money are
not perverse and illegal, which may warrant any interference.
41. Now, the crucial issue which remains is about the effect of non-
appearance of the plaintiff in the witness box to prove his plaint
case. It is an admitted position that the plaintiff himself has
not entered the witness box and has not offered himself to be
cross-examined. In such a situation, a presumption can always
be drawn against him that the case, as pleaded by him, is not
correct. In this connection, a reference can be made to the
decision of this Court in the case of Vidhyadhar vs Manikrao
10
and Another , which lays down that where a party does not
10
(1999) 3 SCC 573
20
appear in the witness box, a presumption would arise that the
case set up by him is not correct. This Court in laying down as
aforesaid has referred to various decisions of the High Court.
The decisions of the High Court are also to the effect that when
a party fails to appear as a witness, it gives rise to an adverse
inference and nothing more.
42. The adverse presumption, if any, drawn for non-appearing in
the witness box by the plaintiff, is a rebuttal presumption and
if the aforesaid presumption is successfully rebutted by the
other cogent evidence on record, the said presumption would
not be material and applicable. In the present case, PW-4, the
Manager of the plaintiff, had appeared as a witness. He has
stated that he had been working with the plaintiff since 1988
and had the knowledge of all the transactions in relation to the
agreement to sell dated 18.07.1988. His testimony
substantially corroborates the case as set up by the plaintiff in
the plaint, including execution of agreement, payment of
consideration and extension of time. Therefore, in the light of
the evidence of the PW-4, the plaint allegations stand
corroborated. The adverse inference drawn on account of non-
21
appearance of the plaintiff stands rebutted by his evidence and
other evidence on record. In these circumstances, the non-
appearance of the plaintiff in the witness box would not be fatal
in this case.
43. In the recent case of Rajesh Kumar vs Anand Kumar and
11
Others in which one of us (P. Mithal, J) was a party, relying
upon Janki Vashdeo Bhojwani and Another vs Indusind
12
Bank Ltd. and Other , it was held that a power of attorney
holder may depose on behalf of the principal in respect of such
acts which are within his personal knowledge but he cannot
certainly depose for the principal, for the acts done by the
principal and not known personally by him. Applying the same
analogy, the Manager, PW-4 herein had deposed about the
entire transaction based upon his personal knowledge as he
was attached to the plaintiff as the Manager. In such
circumstances, his evidence cannot be discarded.
44. This takes us to the last limb of the argument of the parties
with regard to the equitable and discretionary jurisdiction of
the court to grant the relief of specific performance. No doubt,
11
(2024) 13 SCC 80
12
(2005) 2 SCC 217
22
the agreement to sell was executed on 18.07.1988 and the
decree of specific performance was passed by the First
Appellate Court on 23.04.2003, after a gap of 15 years, no
evidence whatsoever was brought on record to establish that
within this period the price of property in the area had
escalated, making it inequitable to grant the decree of specific
performance.
45. The sale deeds executed by the defendants during the
pendency of the litigation are certainly hit by doctrine of lis
pendens and are non est. At the same time, the plaintiffs have
got the sale deed of the suit land executed in their favour by
following the due process of law on the basis of the decree of
specific performance granted in their favour by the First
Appellate Court. In such circumstances when the decree has
already been executed and substantive rights have accrued in
favour of the heirs of the plaintiff, it would be inequitable to
dislodge them from the benefit of the sale in exercise of
discretionary jurisdiction.
46. Accordingly, in the facts and circumstances of the case, we find
no merit in this appeal and the same is dismissed. The sale
23
deeds executed by the defendants on 12.02.2009 and
27.02.2025 are held to be non est and the decree as passed by
the First Appellate Court is maintained.
...................………………………….. J.
(PANKAJ MITHAL)
.............……………………………….. J.
(PRASANNA.B. VARALE)
NEW DELHI;
APRIL 09, 2026.
24