The Gauhati High Court has clarified that in suits for specific performance, the testimony of a spouse who managed all transactional dealings can sustain the plaintiff’s case, even if the plaintiff herself does not testify, provided the defendant failed to file a written statement and the evidence is unrebutted. This ruling reinforces the principle that procedural technicalities cannot override substantive justice when the facts are clearly established.
Background & Facts
The Dispute
The respondent, Dr. Madhumita Das Mazumdar, a gynaecologist, sought specific performance of a contract to acquire a three-bedroom flat (No. 101/A1, 1375 sq. ft.) on the first floor of the Meghmallar Hill View apartment project in Guwahati, along with a ground floor space of 1000 sq. ft. for establishing a doctor’s clinic. The appellants, Meghmallar Estates and Services Pvt. Ltd. and its Managing Director Anup Saikia, allegedly promised that if the ground floor space could not be legally converted due to GMDA restrictions, they would provide a contiguous two-bedroom flat on the first floor at the same overall price of Rs. 33,00,000. The respondent’s husband, Dr. Kishore Kumar Das, negotiated the deal, made payments, and communicated with the developers.
Key Facts
- The respondent and her husband are both medical professionals seeking to establish a joint clinic.
- On 26.06.2006, they paid Rs. 4,00,000 as initial advance.
- On 12.02.2007, they paid another Rs. 4,00,000.
- On 13.10.2007 and 22.01.2008, SBI disbursed Rs. 9,00,000 directly to the developer in two installments.
- On 09.08.2008 and 05.09.2008, they paid Rs. 2,00,000 and Rs. 3,00,000 respectively.
- Total payments made by both spouses: Rs. 30,00,000 by 05.09.2008.
- Registered agreements dated 06.07.2007 (Exts. 9 & 10) were executed: one for the ground floor space (Rs. 9,30,000) and one for the first-floor flat (Rs. 13,50,000).
- The ground floor space was never approved by GMDA due to parking regulations.
- On 26.11.2008, the developer informed the husband that the ground floor space could not be conveyed and offered either the flat "as is" or cancellation with refund.
- The alternative two-bedroom flat was allegedly sold to another buyer.
- The respondent filed the suit on 15.05.2010 for specific performance, injunction, and compensation.
- The husband filed a separate suit (Title Suit No. 186/2010) for the ground floor space.
Procedural History
- 06.07.2007: Registered agreements executed for ground floor (Ext. 9) and first-floor flat (Ext. 10).
- 05.09.2008: Final payment of Rs. 3,00,000 made; total Rs. 30,00,000 paid.
- 15.05.2010: Suit filed by respondent (Title Suit No. 185/2010).
- 12.12.2013: Appellants permitted to cross-examine plaintiff’s witness, but not allowed to file written statement.
- 22.08.2017: Civil Judge No. 3, Kamrup (M), Guwahati decreed specific performance of the agreement for the first-floor flat (Ext. 10), but did not address compensation.
- 26.03.2026: Judgment reserved.
- 30.04.2026: Judgment pronounced by Gauhati High Court.
The Parties' Positions
Appellants (Defendants):
- Argued that the suit was bad for non-joinder of the husband as a necessary party.
- Contended that the husband, though a competent witness, could not testify to the wife’s readiness and willingness to pay the balance Rs. 3,00,000, as he was not a party to Ext. 10.
- Claimed the Rs. 3,00,000 balance was still due under a modified understanding, and the husband’s admission during cross-examination negated readiness.
- Asserted that the unregistered power of attorney (Ex. 1, dated 12.09.2013) was invalid as it was executed after the cause of action arose.
Respondent (Plaintiff):
- Maintained that the husband was the sole point of contact and handled all negotiations and payments.
- Argued that Section 120 of the Evidence Act makes the husband a competent witness.
- Cited Man Kaur v. Harthar Singh Sangha and Rupak Sharma v. M/S M.G. Enterprises to support that personal knowledge, not formal agency, governs admissibility.
- Highlighted that the appellants filed no written statement, rendering all pleadings and exhibits unrebutted.
Relief Sought
The respondent sought:
- Specific performance of the agreement for the first-floor flat (Ext. 10).
- Permanent injunction against interference with possession.
- Compensation for loss of income, mental agony, and price escalation due to 16-year delay.
The Legal Issue
Can a plaintiff in a suit for specific performance rely solely on the testimony of her husband, who handled all transactions, to establish readiness and willingness to perform the contract, when the husband is not a party to the agreement and no formal power of attorney existed at the time of the transactions?
Arguments Presented
For the Appellant
The appellants contended that the husband, Dr. Kishore Kumar Das, could not depose on behalf of his wife regarding her readiness and willingness to pay the outstanding Rs. 3,00,000, as he was not a party to Ext. 10. They relied on Vidhyadhar v. Manik Rao and Shambhu Dutt Shastri v. State of Rajasthan to argue that a general power of attorney holder cannot be the sole witness for a party. They emphasized that the plaintiff herself never appeared in the witness box, triggering a presumption under Vidhyadhar that her case was untrue. They further argued that the Rs. 3,00,000 balance remained unpaid, and the husband’s admission during cross-examination that he would pay only after execution of the sale deed showed conditional willingness, violating Section 16(c) of the Indian Contract Act. The appellants also claimed misjoinder, asserting joint liability existed between husband and wife for the Rs. 33,00,000 total.
For the Respondent
The respondent countered that Section 120 of the Evidence Act makes the husband a competent witness in civil suits, irrespective of power of attorney. She relied on Man Kaur v. Harthar Singh Sangha to argue that when a spouse exclusively manages all affairs, their testimony on readiness and willingness is admissible. The respondent highlighted that the husband’s evidence was consistent with documentary proof (Exts. 4, 6, 13, 14, 15, 17, 19, 20, 21, 23) showing Rs. 18,00,000 paid by her alone, exceeding the contract price of Rs. 13,50,000. She cited Rupak Sharma v. M/S M.G. Enterprises to show that non-examination of the plaintiff is not fatal if other evidence establishes the case. The respondent emphasized that the appellants’ failure to file a written statement rendered their objections waived, and the Rs. 3,00,000 balance was for two properties, not the subject flat.
The Court's Analysis
The Court undertook a meticulous analysis of the evidentiary and procedural posture of the case. It first rejected the appellants’ argument that the husband’s testimony was inadmissible due to lack of formal power of attorney. The Court noted that the power of attorney (Ex. 1) was executed in 2013, seven years after the cause of action arose, and thus could not retroactively validate the husband’s earlier actions. However, the Court held that competence under Section 120 of the Evidence Act and personal knowledge are sufficient for admissibility.
"The PW1 had both competence as well as sufficient knowledge to depose as a witness and hence, the aforesaid plea of the appellants cannot be accepted. More so, in view of the fact that no written statement was filed by the principal defendants in rebuttal of the stand of the plaintiff/respondent."
The Court then examined the applicability of Man Kaur v. Harthar Singh Sangha. It found that the Supreme Court’s exception for spouses managing all affairs applied directly: "Where all the affairs of a party are completely managed, transacted and looked after by an attorney (who may happen to be a close family member), it may be possible to accept the evidence of such attorney even with reference to bonafides or 'readiness and willingness'."
Crucially, the Court observed that the entire transaction was conducted by the husband: negotiations, correspondence, payments, and follow-ups. The respondent’s verification of the plaint was procedural, not evidentiary. The husband’s affidavit explicitly stated his personal knowledge, and the appellants failed to cross-examine him on this point.
The Court further held that the Rs. 3,00,000 alleged balance was not part of the contract for the first-floor flat. The letter dated 19.02.2009, cited by appellants, pertained to two properties and was never incorporated into any binding agreement. The contract price for the flat was Rs. 13,50,000, and the respondent had paid Rs. 18,00,000 toward it - exceeding the obligation.
Regarding non-joinder, the Court held that the husband was not a party to Ext. 10, and the seller had no interest in the source of funds. The burden to prove joint liability lay with the appellants, who failed to discharge it.
Finally, the Court addressed the omission of compensation. It noted that Section 21 of the Specific Relief Act mandates compensation when specific performance is decreed but justice requires additional relief. The 16-year delay, during which property values rose and the clinic opportunity was lost, constituted a clear breach. The trial court’s failure to consider this was an error.
The Verdict
The appeal was dismissed. The cross-objection was allowed. The Court upheld the decree for specific performance of the agreement for the first-floor flat (No. 101/A1) dated 06.07.2007. The Court directed the trial court to determine compensation for the delay, including loss of income, mental agony, and price escalation, within three months. The respondent is entitled to interest at 9% per annum from 06.07.2010 until realization. Costs of Rs. 50,000 are awarded to the respondent.
What This Means For Similar Cases
Spouse’s Testimony Can Sustain Specific Performance
- Practitioners may rely on the testimony of a spouse who managed all transactional dealings to prove readiness and willingness under Section 120 of the Evidence Act, even without a power of attorney.
- The absence of the plaintiff in the witness box is not fatal if documentary evidence and the spouse’s testimony establish the case on a preponderance of probability.
- Courts will not enforce technicalities when the defendant has failed to file a written statement.
Compensation Must Be Addressed in Specific Performance Suits
- Section 21 of the Specific Relief Act is mandatory: courts must consider compensation when specific performance is granted and delay has caused loss.
- Loss of income, mental agony, and price escalation are valid heads of compensation if pleaded and supported by evidence.
- Delay of over a decade triggers a strong presumption of damage; courts must quantify it, not ignore it.
Non-Joinder Is Not Automatic
- A non-party spouse cannot be deemed a necessary party merely because joint payments were made.
- The burden to prove joint liability rests on the defendant, not the plaintiff.
- Courts must distinguish between contractual obligations and financial arrangements between spouses.
