The Madhya Pradesh High Court has reaffirmed that the equitable remedy of specific performance cannot be granted unless the plaintiff proves continuous readiness and willingness to perform contractual obligations from the date of agreement to the date of decree. This judgment clarifies a critical doctrinal requirement under the Specific Relief Act, 1963, with direct implications for property litigation across India.
Background & Facts
The Dispute
The dispute arose from a purported sale agreement dated 23.05.1995, wherein the defendant, Gulab, agreed to sell 1.360 hectares of land in Village Banwa, Tahsil Ganj Basoda, District Vidisha, to the plaintiff, Ramesh Kumar, for a total consideration of Rs.30,000. Of this, Rs.28,000 was paid as earnest money, with the balance of Rs.2,000 to be paid by 03.05.1996, following which the defendant was to execute the sale deed. The agreement also stated that possession of the land had been delivered to the plaintiff.
Key Facts
- The sale agreement (Exhibit P-1) was signed on 23.05.1995
- The plaintiff claimed possession of the land was delivered prior to the agreement
- The plaintiff did not make any formal demand for execution of the sale deed between 23.05.1995 and 06.03.1998
- A legal notice was sent by registered post on 06.03.1998 and received by the defendant on 09.03.1998
- The suit for specific performance was filed on 13.05.1998
- The defendant denied execution of the agreement, claimed joint ownership, and asserted that partition of the land had not occurred until 1998
- The plaintiff’s father, Dulichand, was a joint holder of the land with the defendant
- The plaintiff admitted that no partition of the land existed at the time of the agreement, making the sale of a defined portion legally questionable
- The plaintiff’s testimony conflicted with the agreement: he claimed possession was given 3-4 years before the agreement, while the agreement stated possession was delivered on the same day
Procedural History
- 23.05.1995: Sale agreement executed
- 03.05.1996: Deadline for payment of balance and execution of sale deed
- 06.03.1998: First legal notice sent by registered post
- 09.03.1998: Notice received by defendant
- 13.05.1998: Suit for specific performance filed in Court of Civil Judge Class-I, Basoda (Civil Suit No.12-A/1998)
- 10.05.2005: Trial Court dismissed the suit, holding plaintiff failed to prove readiness and willingness; granted refund of Rs.28,000 with 6% interest
- 19.05.2006: First Appellate Court reversed the trial court’s decision and decreed specific performance without addressing the readiness and willingness finding
- 08.02.2016: Second Appeal admitted by High Court on the substantial question of law regarding readiness and willingness
- 23.06.2026: Judgment delivered by the High Court
The Parties' Positions
Plaintiff (Ramesh Kumar): Claimed the agreement was genuine, possession was delivered, and he was always ready and willing to pay the balance. He relied on the agreement, witness testimony, and the fact that he had paid Rs.28,000 as earnest money.
Defendant (Gulab): Denied execution of the agreement, claimed joint ownership, asserted no partition had occurred in 1995, and challenged the plaintiff’s conduct as inconsistent with readiness and willingness. He argued the transaction was a loan, not a sale.
Relief Sought
The plaintiff sought a decree for specific performance of the agreement and, in the alternative, refund of Rs.28,000 with interest. The defendant sought dismissal of the suit in its entirety.
The Legal Issue
The central question was whether a plaintiff in a suit for specific performance can obtain relief when the trial court has recorded a negative finding on readiness and willingness, and the first appellate court fails to expressly reverse that finding before granting the decree.
Arguments Presented
For the Appellant
The appellant’s counsel argued that Section 16(c) of the Specific Relief Act, 1963, mandates that a plaintiff must plead and prove continuous readiness and willingness from the date of the agreement to the date of the decree. He relied on N.P. Thirugnanam v. R. Jagan Mohan Rao (Dr), Shenbagam v. K.K. Rathinavel, and Dheeraj Developers v. Om Prakash Gupta to establish that failure to address this issue renders the decree unsustainable. He emphasized that the plaintiff’s silence for nearly three years after the agreement, coupled with unexplained delay in filing suit, demonstrated lack of bona fides. He further cited U.N. Krishnamurthy v. A.M. Krishnamurthy and Darshan Singh v. Brij Bhushan Chaudhary to argue that delay and unfair advantage negate equitable relief.
For the Respondent
No appearance was made by the plaintiff or his counsel. The State, through the Government Advocate, supported the appellant’s position, noting that the first appellate court’s failure to reverse the trial court’s adverse finding on readiness and willingness was a legal error. The State contended that the appellate court’s decree was contrary to settled law and violated the mandatory requirement under Section 16(c).
The Court's Analysis
The Court held that Section 16(c) of the Specific Relief Act, 1963, is not a mere procedural formality but a substantive condition precedent to the grant of specific performance. The court emphasized that the plaintiff’s conduct must demonstrate consistent readiness and willingness, not merely a statement in the plaint.
"The continuous readiness and willingness on the part of the plaintiff is a condition precedent to grant the relief of specific performance. This circumstance is material and relevant and is required to be considered by the court while granting or refusing to grant the relief."
The Court observed that the first appellate court committed a fundamental error by affirming the genuineness of the agreement but failing to address or reverse the trial court’s explicit finding that the plaintiff had not proven readiness and willingness. The appellate court’s silence on this issue was not a mere oversight - it was a legal omission that vitiated the decree.
The Court further noted that the plaintiff’s conduct was inconsistent with a genuine desire to complete the transaction. He paid Rs.28,000 as earnest money but waited nearly three years before issuing a legal notice, despite the agreement stipulating completion by 03.05.1996. The Court found it implausible that a buyer would delay pursuing a transaction for a mere Rs.2,000 for over a year, especially when possession had allegedly been delivered.
The Court also highlighted contradictions in the plaintiff’s testimony: he claimed possession was given three to four years before the agreement, while the agreement stated it was delivered on the same day. The absence of partition in 1995 further undermined the feasibility of selling a defined portion of the land.
The Court relied on U.N. Krishnamurthy v. A.M. Krishnamurthy and Darshan Singh v. Brij Bhushan Chaudhary to underscore that delay in filing suit, especially near the limitation period, and failure to explain inaction are fatal to equitable claims. The Court concluded that the plaintiff’s conduct did not reflect clean hands, a necessary condition for equitable relief.
The Verdict
The appellant succeeded. The High Court set aside the judgment and decree dated 19.05.2006 of the Additional District Judge, Ganj Basoda, in Regular Civil Appeal No.126-A/2005. The judgment and decree dated 10.05.2005 of the Civil Judge, Class-I, Basoda, in Civil Suit No.12-A/1998, was restored. The plaintiff is entitled to a refund of Rs.28,000 with interest at 6% per annum from the date of the suit until actual payment. The decree shall be drawn accordingly.
What This Means For Similar Cases
Readiness and Willingness Cannot Be Assumed
- Practitioners must now ensure that pleadings explicitly detail every step taken by the plaintiff to perform their obligations, including communications, financial readiness, and attempts to complete the transaction
- A mere assertion in the plaint that the plaintiff was "ready and willing" is insufficient without corroborative evidence of conduct
- Courts will scrutinize delays between agreement and notice, and between notice and filing of suit
Delay Is Fatal Unless Justified
- Unexplained delays of more than one year after the contractual deadline will be viewed with suspicion
- Filing a suit just before limitation expires, without explanation, is now a recognized ground to deny specific performance
- Courts will consider whether the plaintiff acted with diligence or exploited the defendant’s inaction
Appellate Courts Must Actively Address Section 16(c)
- First appellate courts cannot affirm a decree for specific performance while ignoring a trial court’s adverse finding on readiness and willingness
- The appellate court must either reverse the finding or remand for fresh adjudication
- Failure to do so renders the decree legally unsustainable under Section 16(c)
