#earnest money refund

The Karnataka High Court affirmed that mere assertions of readiness and willingness to perform a contract are insufficient under Section 16(c) of the Specific Relief Act - plaintiffs must produce contemporaneous documentary proof such as bank statements, correspondence, or payment records. This sets a clear evidentiary standard for property buyers seeking specific performance, shifting the burden beyond oral claims to verifiable paper trails.

The Rajasthan High Court ruled that a statutory authority cannot forfeit ₹9.46 crores in earnest money for failing to deliver encroachment-free land as promised in public auctions. The court directed a full refund with 10% interest, reinforcing that state entities cannot escape liability for contractual breaches under the guise of administrative discretion.

The Punjab & Haryana High Court has ruled that banks must precisely disclose all property details in SARFAESI auction notices, including Khasra numbers and the exact scope of mortgaged assets. Misrepresentation or omission - such as including non-mortgaged machinery - renders the auction void and obligates the bank to refund earnest money with 9% interest, reinforcing transparency as a non-negotiable condition of secured creditor action under the Act.

Himachal Pradesh High Court holds that an agreement to sell land within the 10-year prohibition period under Section 113 of the H.P. Tenancy Act is void and cannot be specifically enforced. However, the court directs a refund of Rs. 8,00,000 earnest money with 6% interest, reinforcing equitable relief where statutory bars prevent contractual enforcement.