Pankajkumar Vanechand Meghani vs Majumdar And Associates, A ...
2021 Latest Caselaw 4894 Guj

    C/SA/116/2020                                                 JUDGMENT




           IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

                    R/SECOND APPEAL NO. 116 of 2020

                              With
       CIVIL APPLICATION (FOR INTERIM RELIEF) NO. 1 of 2020
                In R/SECOND APPEAL NO. 116 of 2020

FOR APPROVAL AND SIGNATURE:


HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI

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1   Whether Reporters of Local Papers may be allowed
    to see the judgment ?

2   To be referred to the Reporter or not ?

3   Whether their Lordships wish to see the fair copy
    of the judgment ?

4   Whether this case involves a substantial question
    of law as to the interpretation of the Constitution
    of India or any order made thereunder ?

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               PANKAJKUMAR VANECHAND MEGHANI
                           Versus
          MAJUMDAR AND ASSOCIATES, A PARTNERSHIP FIRM
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Appearance:
MR DHAVAL D VYAS(3225) for the Appellant(s) No. 1,2
 for the Respondent(s) No. 1
MR AMAR N BHATT(160) for the Respondent(s) No. 2
MR AS VAKIL(962) for the Respondent(s) No. 3
MR KUNAL P VAISHNAV(5111) for the Respondent(s) No. 4
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===

 CORAM: HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI

                             Date : 31/03/2021

                            ORAL JUDGMENT

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1. The appellants have filed present Second

Appeal under Section 100 of the Civil

Procedure Code, 1908 challenging the common

judgment and decree dated 18.11.2019 passed

by the 8th Additional District Judge, Surat

in Appeal Nos. 82, 83 and 84 of 2006, in so

far as the impugned judgment is passed in

Regular Civil Appeal No.82 of 2006 of the

present Appellants. By the impugned

judgment, the Appellate Court has partly

allowed the Appellants' Regular Civil Appeal

No.82 of 2006 and has directed the

respondents­defendants to pay an amount of

Rs.1,20,000/­ along with interest at the

rate of 12% per annum from the date of

filing of the Suit till realisation. By the

impugned judgment, the Appellate Court has

granted the appellants­plaintiffs'

alternative prayer of seeking refund of

Rs.11,000/­ towards earnest money plus a sum

of Rs,1,09,999/­ towards compensation

totaling to Rs.1,20,000/­. By the present

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Second Appeal, the appellants­plaintiffs are

pursuing the relief of specific performance

of the alleged contract which the Trial

Court, as well as the Appellate Court, have

refused in their discretion.

2. Brief facts, leading to institution of

the present appeal are as under :­

2.1 The respondents­defendants are the

owners of the land, bearing Final Plot No.

They decided to construct appartments, named

as "Sundaram" out of which, Flat No. 1,

admeasuring about 1880 sqft was agreed to be

sold to the appellants herein for an

aggregate sum of Rs 1,16,560/­ on 18th

October 1978 and against which, the

appellants­plaintiffs paid consideration

of Rs.11,000/­ which was receipted on

16.10.1978, 18.10.1978 and 28.12.1978

by the defendants. The defendants had

assured the Plaintiffs that the

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construction of good quality flats

shall be completed as early as

possible. The land was proposed to be

acquired U/s 294D by the Income Tax

Department. After being aware that the

acquisition was to be dropped, the

Defendants therefore sent back

Rs.11000/­ citing impossibility of

performance vide letter dated

03.10.1979. The refusal was not

acquiesced by the plaintiffs and the

cheque was returned to the defendants.

Thereafter, the proposed acquisition of

the land was dropped which was

communicated by the IT Department to

the Defendants vide letter dated

15.11.1979 (Exh. 116). The plaintiffs

therefore issued notice dated

24.12.1979 calling upon the Defendants

to specifically perform the agreement

with willingness that in the

eventuality of any impediments in

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completing construction, the plaintiffs

were prepared to bear reasonable

expenses and complete the construction.

The Defendants responded vide letter

dated 01.02.1980 declining to perform

the Agreement.

3. The appellants­plaintiffs had filed

Special Civil Suit No.163 of 1981 for

specific performance of an agreement dated

October, 1978 with the following prayers:­

"1) Kindly pass an order to draw

decree of Specific Performance

directing to handover the construction

of the Sundaram Apartment to the

plaintiff or to sell the constructed

flat no.1 admeasuring 1880 Sq. Feet

after constructing Sundaram Apartments

on the land registered vide Mutation

Entry No.300A of Ward No.13, Final

Plot No.279 of T.P.Scheme near

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Dhavalgiri in Athwalines of Surat

City;

In the alternative

2. Kindly grant the cost to the

plaintiffs from the respondents in

respect of the earnest money amount of

Rs.500/­ paid by the plaintiff no.1

and Rs.500/­ paid by the plaintiff

no.2 and the sale consideration amount

of Rs.5000/­ taken by the respondents

from the plaintiff no.1 and Rs.5000/­

taken by the respondents from the

plaintiff no.2 and Rs.1,09,999/­

towards damages, aggregating to

Rs.1,20,000/­ with compounding

interest @ 12% accrued thereon.

3. Kindly grant the entire cost of the

suit from respondents to the

plaintiff."

The appellants­plaintiffs had paid

Rs.500/­ each on 18.10.1978 and Rs.5000/­

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each on 26.12.1978 and 28.12.1978

respectively aggregating to Rs.11,000/­ to

the dependents. The receipts mention Flat

No.1, area of 1880 sq. ft. and the total

price of Rs.1,16,560/­. The Trial Court has

framed the issue as to whether plaintiff

proves that there was a contract with the

defendant to sell suit flats ? The Trial

Court has answered the said issue in

'negative' and held that there was no

privity of contract. The case of the

appellants­plaintiffs was based on oral

agreement. Except the receipts, there is no

other document evidencing any agreement

between the parties even according to the

appellants­plaintiffs. The Trial Court has

held that under Section 14 of the Specific

Relief Act, 1963 no specific performance

can be granted as well as rejected the

prayer for compensation. From the

deposition of the plaintiff - Pankajkumar

Vanechand Meghani at Ex.53 it is clearly

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established that plaintiff has paid

Rs.11,000/­ by cheque and, therefore, Trial

Court has held that appellants­plaintiffs

are entitled to recovery Rs.11,000/­ only

from the respondents­defendants with

interest at 12% per annum from the date of

the suit till realization.

4. Being aggrieved and dissatisfied with

the judgment and decree of the Trial Court

the original plaintiffs filed Regular Civil

Appeals No.82, 83 and 84 of 2006. The present

challenge is qua the Regular Civil Appeal

No.82 of 2006. The following questions of law

came to be framed by the Appellate Court for

determination of the appeal :­

(i) Wheather there was a concluded contract

between the plaintiffs and the defendants?

(ii) Whether the plaintiffs have been ready

and willing to perform their part of the

contract ?

 C/SA/116/2020                                                     JUDGMENT




     (iii)        Whether         the        Special        Civil          Suit

     No.574/89         (Regular         Civil      Suit       No.876/80)

     was barred by limitation ?

(iv) Whether the plaintiffs/appellants are

entitled to specific performance of the

contract or in the alternative to get

damages and if entitled to damages, then to

what extent ?

(v) Whether the judgment passed by the Ld.

Trial Court is liable to be interfered with

?

(vi) What order ?

                 The        Appellate           Court            in          the

      Judgment          and       Decree       dated        18.11.2019

has answered the issue nos.1, 2 and 5

in affirmative, issue no.3 in negative

and whilst issue no.4 was held partly

in affirmative. The Appellate Court

has held that there was a concluded

contract between the parties and

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further held that the contract which

requires supervision for its

performance, the Court cannot

supervise and it is not enforceable

contract. The Appellate Court held

that the appellants­plaintiffs are not

entitled to specific performance of

the contract but in the alternative

are entitled to get damages of Rs.

1,20,000/­ alongwith interest @ 12%

p.a. from the date of filing of the

suit till the date of realization of

the amount. The Appellate Court by

judgment and order dated 18.11.2019 passed

the following order :­

"(1) The present Regular Civil

Appeals are hereby partly allowed with

costs.

(2)The Common Judgment passed on

22.02.1996 by the Ld. 3rd Joint Civil

Judge (S.D), Surat, in Special Civil

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Suit No.l63/81, Special Civil Suit

20.177/81 and Special Civil Suit

No.574/89, is hereby modified.

(3)Respondents are directed to pay to

the plaintiffs /appellants in Special

Civil Suit No.163/81. Special Civil

Suit no.177/81 and Special Civil Suit

No.574/89 an amount of Rs.

1,20,000/alongwith interest @ 12% p.a.

from the date of filing of the suit

till the date of realization of the

amount. It is made clear that in

Special Civil Suit No.574/89, the date

of filing of the suit shall be

considered as of the earlier Suit

No.876/80."

     5.              Feeling                       aggrieved                       and

     dissatisfied                  with            the     judgment                and

     decree            dated       18.11.2019              passed         by       the

     learned            8th   Additional                 District          Judge,

Surat (hereinafter referred to as 'the

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learned Appellate Court Judge') in

of 2006 and 84 of 2006, the appellants

have preferred captioned second appeal,

raising following substantial questions

of law:

1. Having held that the plaintiffs were more than ready and willing to perform a concluded contract, were the Courts justified in refusing decree for specific performance?

2. Were the Courts justified in passing the decree for Rs.120000/­ along with interest at the rate of 12% only which placed the defendants to infer advantage?

3. Were the Courts justified in not compensating the plaintiffs proportionate to the present market value of the suit property inter alia of the decree of specific performance?

6. Heard Mr. Dhaval D. Vyas, learned

advocate for the appellants, Mr. Amar N.

Bhatt, learned advocate on caveat for the

respondent no.2 and Mr. A.S. Vakil, learned

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advocate for the respondent no.3.

7. Learned counsel Shri Dhaval D Vyas

appearing for the appellants contended that

the Courts below have committed a

substantial error of law in rejecting the

claim of the appellants­plaintiffs for

specific performance of the contract between

the parties. He contended that the learned

Appellate Judge has committed an error in

not granting a decree for specific

performance by holding though that there was

a concluded contract between the plaintiffs

and the defendants, the plaintiffs were not

ready and willing to perform their part of

the contract. He further contended that the

Appellate Court has failed to appreciate

that when it has been established that there

was a concluded contract between the

parties, and when the plaintiffs were ready

and willing to perform their respective part

of the contract and even more, have shown

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their willingness to spend for the

construction, if the defendants were not in

a position to raise construction; as per the

agreement, the Civil Court was bound to pass

a decree for specific performance, when the

equitable considerations are all in favour

of the appellants­plaintiffs. Learned

Counsel for the appellants further contended

that the learned Appellate Judge was not

justified in restricting direction to the

defendants to pay a sum of Rs.1,20,000/­

alongwith interest @ 12% per annum from the

date of filing of the suit, till its

realization. He vehemently submitted that

the Court below has committed serious

substantial error of law in not passing the

decree for specific performance of contract

on the mere assumption of there being some

objection/restriction from the Income Tax

Department, which was nowhere in the picture

during the pendency of the proceedings. He

added that the Civil Court could have in

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such eventuality passed a conditional decree

for specific performance, subject to removal

of objections; if there being any. However,

the Court was not justified in refusing the

decree for specific performance of contract

without considering the decision of Hon'ble

Supreme Court, rendered in the case of

Popatji Babji Thakore & Ors. vs. Manubhai

Chimanlal Shah and Ors., reported in (2009)

1 G.L.H. 302. He has relied upon the

decisions rendered in case of Motilal Jain

vs. Smt. Ramdashi Devi reported in AIR 2000

SC 2408, in case of State Bank of India and

Ors. vs. S.N. Goyal reported in AIR 2008 SC

2594 and in case of Pratap Lakshman Muchandi

and Ors. Vs. Shamlal Uddavadas Wadhwa and

Ors. reported in AIR 2008 SC 1378. Learned

advocate for the appellants further relied

upon the amended section 14 of the Specific

Relief Act, 1963.

8. Mr. Vyas has submitted that findings

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of the Appellate Court has been arrived at

taking into consideration the unamended

Sections 10 and 20 of the Specific Relief

Act, 1963 which reads as under :­

"Section 10. Cases in which specific performance of contract enforceable.-- Except as otherwise provided in this Chapter, the specific performance of any contract may , in the discretion of the court , be enforced--

(a) when there exists no standard for ascertaining actual damage caused by the non­performance of the act agreed to be done; or

(b) when the act agreed to be done is such that compensation in money for its non­ performance would not afford adequate relief.

Explanation.--Unless and until the contrary is proved, the court shall presume--

(i) that the breach of a contract to transfer immovable property cannot be adequately relieved by compensation in money; and

(ii) that the breach of a contract to transfer movable property can be so relieved except in the following cases:--

(a) where the property is not an ordinary article of commerce, or is of special value or interest to the plaintiff, or consists of goods which are not easily obtainable in the market;

(b) where the property is held by the defendant as the agent or trustee of the plaintiff.

Section 20: Discretion as to decreeing specific performance .--

(1) The jurisdiction to decree specific performance is discretionary, and the court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the court is not

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arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal. (2) The following are cases in which the court may properly exercise discretion not to decree specific performance:--

(a) where the terms of the contract or the conduct of the parties at the time of entering into the contract or the other circumstances under which the contract was entered into are such that the contract, though not voidable, gives the plaintiff an unfair advantage over the defendant; or

(b) where the performance of the contract would involve some hardship on the defendant which he did not foresee , whereas its non­performance would involve no such hardship on the plaintiff; or

(c) where the defendant entered into the contract under circumstances which though not rendering the contract voidable, makes it inequitable to enforce specific performance.

Explanation 1.--Mere inadequacy of consideration, or the mere fact that the contract is onerous to the defendant or improvident in its nature, shall not be deemed to constitute an unfair advantage within the meaning of clause (a) or hardship within the meaning of clause (b). Explanation 2.-- The question whether the performance of a contract would involve hardship on the defendant within the meaning of clause (b) shall, except in cases where the hardship has resulted from any act of the plaintiff subsequent to the contract, be determined with reference to the circumstances existing at the time of the contract.

(3) The court may properly exercise discretion to decree specific performance in any case where the plaintiff has done substantial acts or suffered losses in consequence of a contract capable of specific performance.

(4) The court shall not refuse to any party specific performance of a contract merely on the ground that the contract is not enforceable at the instance of the party ."

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9. He has further submitted that both

the above provisions conferring discretion

in Courts to decree a specific performance

of contract, have been amended by Act No.18

of 2018, which reads as under :­

"Section 10. Specific purpose in respect of contracts: the specific performance of a contract shall be enforce by the Court subject to the provisions contained in sub­section (2) of Section 11, Section 14 and Section

16.

Section 20: Substituted performance of contract:

(1) Without prejudice to the generality of the provisions contained in the Indian Contract Act, 1872, and, except as otherwise agreed upon by the parties, where the contract is broken due to non­performance of promise by any party, the party who suffers by such breach shall have the option of substituted performance through a third party or by his own agency, and, recover the expenses and other costs actually incurred, spent or suffered by him, from the party committing such breach.

(2) No substituted performance of contract under sub­section (1) shall be undertaken unless the party who suffers such breach has given a notice in writing, of not less than thirty days, to the party in breach calling upon him to perform the contract within such time as specified in the notice, and on his refusal or failure to do so, he may

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get the same performed by a third party or by his own agency: Provided that the party who suffers such breach shall not be entitled to recover the expenses and costs under sub­section (1) unless he has got the contract performed through a third party or by his own agency. (3) Where the party suffering breach of contract has got the contract performed through a third party or by his own agency after giving notice under sub­ section (1), he shall not be entitled to claim relief of specific performance against the party in breach.

(4) Nothing in this section shall prevent the party who has suffered breach of contract from claiming compensation from the party in breach ."

    10.                He     has        submitted           that           the

    amended        provisions           leave     no       discretion

    in      the    Court      but        to     direct         specific

    performance              of       the        agreement.                   He

    submitted          that         the        Hon'ble            Supreme

Court had an occasion to interpret the

amended provisions whilst considering

the plea for enforcement of an

agreement which was executed prior to

the amendment. In support of this

submission he relied on the decision in

the case of B. Santoshamma and Ors. vs.

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D. Sarala and Ors., reported in

Manu/SC/0698/2020. Lastly he has prayed

that the appeal may be admitted for decision

on the questions of law.

11. Per contra, Mr. Amar N. Bhatt, Ld.

Advocate for the respondent No.2 has

submitted that the lower Appellate Court

held that there was a concluded contract

between the parties, that the appellants ­

plaintiffs are ready and willing to perform

their part of the contract. However,

thereafter it is held that the appellants ­

plaintiffs are not entitled to specific

performance of the contract but in the

alternative are entitled to get damages and

the damages that has been awarded are to the

extent prayed for. Thus, the real and the

limited question as such in the present

Second Appeal is whether the lower Appellate

Court was justified in refusing specific

performance for the reasons stated by the

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lower Appellate Court in paragraphs 32, 33,

34, 35, 36 and 37. The discretion is

exercised based on the facts and considering

the totality of circumstances. The lower

Appellate in paragraph 32 has clearly

observed that, "the nature of the contract

is such that it requires continuous

supervision for its performance which cannot

be supervised by the Court. The agreement

between the parties was oral and as such the

minute details and the terms of mode of

execution of contract were not reduced in

writing and in those circumstances the

contract is not capable enough as to direct

specific performance of the same". He has

submitted that the refusal of the lower

Appellate Court is essentially on

appreciation of facts and evidence on record

and the same cannot in any manner involve a

question of law, much less a substantial

question of law for this Court to exercise

its jurisdiction under Section 100 of the

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Civil Procedure Code.

12. He has submitted that it will be

inequitable to grant a decree of specific

performance where it 1s clear that the

appellants ­ plaintiffs will have an unfair

advantage over the respondents ­ defendants.

The lower Appellate Court has clearly

explained the reasons for not granting a

decree for specific performance and instead

granted a decree of recovery of money. The

jurisdiction to grant decree of specific

performance is discretionary and Section

20(2) lists the cases in which the Court may

properly exercise discretion not to grant

decree of specific performance. The

respondents ­ defendants most humbly submit

that it would only be prudent to uphold the

lower Appellate Courts judgment not to

decree specific performance more

particularly so when the plaintiffs of the

other two Suits have already unconditionally

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accepted the lower Appellate Courts judgment

and decree by accepting the entire decretal

amount paid over by the respondents -

defendants.

13. He has further submitted that the

alternate prayer for refund of earnest money

deposit and compensation is granted in full.

It is in view of the aforesaid that the

respondent ­ defendants submit that both the

Courts i.e. the Trial Court and the lower

Appellate Court have concurrently refused

specific performance. The decision of not

granting specific performance is "concurrent

in nature".

14. He has submitted that the questions

raised by the appellants at page (F) of the

memo of second appeal cannot at all be

construed to be questions of law. In support

of his submission, he has placed reliance

upon the decision rendered in case of

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Gurvachan Kaur and Others Vs. Salikram

through lrs. reported in (2010) 15 SCC 530

wherein the Hon'ble Supreme Court has held

that in para 10, which reads as under:

"10. It is settled law that in exercise of power under Section 100 of the Code of Civil Procedure, the High Court cannot interfere with the finding of fact recorded by the first appellate court which is the final court of fact, unless the same is found to be perverse. This being the position, it must be recorded by the first appellate court on the issues of existence of landlord­tenant relationship between the plaintiff and the defendant and default committed by the latter in payment of rent."

15. He further placed reliance upon the

decision rendered in case of Damodar Lal vs.

Sohan Devi and Others reported in (2016) 3

SCC 78 and the decision rendered in case of

Veerayee Ammal vs. Senni Ammal reported in

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(2002) 1 SCC 134. After relying upon the

above decisions, he submitted that the

impugned judgment of the lower appellate

Court has applied settled principles and

decisions and therefore, no interference is

required to be called for in the second

appeal. The provision of Section 100 of CPC

restricting Second Appeal only on the

substantial questions of law is based on the

public policy expressed maxim 'interest

republican ut sit finis litium' meaning that

it is in the interest of the State that

there must be an end to litigation. There is

no perversity of any kind demonstrated by

the lower appellate Court in the matter of

appreciation of evidence. It is only after

appreciation of evidence, that the lower

appellate Court has observed that the

performance involved the performance of a

continuous duty which the Court cannot

supervise and hence the decree of specific

performance is refused. Such appreciation of

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evidence cannot be termed as 'perverse' much

less would warrant any exercise of powers

under Section 100 of the CPC. He further

submitted that there are concurrent findings

of the courts below in so far as prayers of

the plaintiffs for specific performance is

concerned. Relying on the issues framed and

decided by the trial Court and reappreciated

by the lower appellate Court, he submitted

that the courts below have rightly held that

the appellants­plaintiffs have failed to

prove that there was concluded contract to

sell suit flats, which can be enforced. He

also submitted that it will be inequitable

to grant a decree of specific performance

where it is clear that the appellants­

plaintiffs will have an unfair advantage

over the respondents­defendants. Reliance is

placed upon the decisions rendered in case

of Bellachi by lrs. vs. Pakeeran reported in

(2009) 12 SCC 95, in case of K. Nanjappa by

legal representatives vs. R.A. Hameed @

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Ameersab by legal representatives and

another reported in (2016) 1 SCC 762, in

case of Shamsher singh and others vs.

Rajinder kumar and others reported in (2015)

5 SCC 531 and in case of State of H.P. And

another vs. Akshara nand by lrs. and others

reported in (2000) 3 SCC 661. It is

submitted that therefore no substantial

questions of law arise in this second

appeal. There was no interim relief granted

or operating during the pendency of the

special civil suit or regular civil appeal.

Therefore, the question of granting any

interim relief as prayed for in the civil

application at any rate does not arise. The

second appeal and the civil application may

therefore, be dismissed.

16. I have heard learned advocate for the

respective parties. I have gone through the

submissions advanced by the learned advocates

for both the sides. I have also gone through

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the orders passed by the learned trial Court

and learned Appellate Court as well as the

documents on record.

17. The Trial Court has by judgment and

decree dated 22.2.1996 partly allowed the

suit and granted compensation of Rs.11,000/­

to be recovered from the original defendants

with interest at the rate of 12% per annum

from the date of suit till realization. The

original plaintiffs preferred Appeal against

the said judgment and decree before the

Appellate Court. The Appellate Court has

partly allowed the Regular Civil Appeal

directing the respondents­defendants to pay

to the original plaintiffs/appellants in

Special Civil Suit No.163/81, Special Civil

Suit no.177/81 and Special Civil Suit

No.574/89 an amount of Rs.1,20,000/­

alongwith interest @ 12% p.a. from the date

of filing of the suit till the date of

realization of the amount.

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  18.             The    present         challenge         is     qua        the

Regular Civil Appeal No.82 of 2006. This

Court is in agreement with the view taken by

the learned Courts below in view of the

following:­

(a) The Appellate Court has accepted

that there is a contract between the parties,

however it has held that the quality and

details of construction and material was not

mutually agreed upon and was dependent only

on gentleman's promise of the parties. The

test was undertaken by the learned Appellate

Court to see if it would be sufficient enough

for directing specific performance of

contract. The Appellate Court examined the

facts to find out as to whether it would be

sufficient enough for granting the decree for

specific performance of the contract. The

learned Appellate Court considered Section 14

of the Specific Relief Act and came to a

conclusion that the contract which requires

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continuous supervision for its performance

which Court cannot specifically enforced by

the Court. Sub­section 3 of the section is

exception to the said rule. However, in order

to classify it into the exception, it has to

be seen that the building or other work is

precisely and sufficiently stated in the

terms of the contract between the parties.

Further, the plaintiffs must have a

substantial interest in the performance of

the contract, which could not be a

compensated in terms of money. Admittedly, in

the present case, the terms regarding the

quality and type of construction were not

mutually settled between the parties even as

per the case of the plaintiffs. Even the

plaintiffs had not invested substantial

amount of the cost of the project in the

project and only paid 5% to 10% of the

consideration amount. The nature of the

contract is such that it requires continuous

supervision for its performance, which cannot

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be supervised by the Court. The agreement

between the parties was oral and as such the

minute details and the terms of mode of

execution of contract were not reduced into

writing and in those circumstances the

contract is not capable enough so as to

direct specific performance of the same.

Further, present is not the case where the

construction had started and was left in

between and the completion of the same is to

be directed. In the present case, even the

plan for construction of flats was not got

sanctioned from the SMC. The judgments relied

upon by the Ld. Counsel for the appellants in

this regard are not applicable to the facts

of the present case as in those cases

construction of flats was not in question and

only land was to be sold.

(b) It is well settled law that the

grant of decree of specific performance is

the discretion of the court and it is always

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not necessary to grant specific performance

simply because it is legal to do so.

Ordinarily the plaintiff is not to be denied

~ the relief of specific performance only on

account of ­ phenomenal the price of property

during the pendency of the application but

still that it is relevant factor to be taken

into consideration while refusing the decree

of specific performance specifically than the

plaintiff has not paid a considerable amount

toward the sale consideration and only paid

5% or 10% of the consideration amount as on

the contrary, plaintiff would also have

invested the remaining amount somewhere else

and would have reaped the benefits of the

phenomenal increase in prices of the

properties in the vicinity. Furthermore, if

other factor beside would also weighs against

the grant of specific performance of contract

the court may refuse the. same and still

award the compensation amount as stipulated

under Section 21 of the Specific Relief Act.

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As per sub section 4 of the said section, the

amount of compensation shall 'be determined

in accordance with the principles specified

under Section 17 of the Indian Contract Act,

1872. Further sub Section 5 stipulated that

such compensation shall not be awarded unless

claimed by the plaintiff in his plaint.

(c) Once the specific performance of the

contract is declined, it has to be seen as to

what would be the quantum of the damages or

compensation, which could be awarded in

favour of appellants in lieu of specific

performance of contract. In the matter at

hand, suit land was valued at around

Rs.60,000/­ during the period when the

agreement was entered into between the

parties as per the valuation before of the

plot filed by the respondent before the

Income Tax Department. Learned Counsel for

the appellants has filed the current circle

rates of the properties in the area as

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Rs.36,000/­ per sqr. Mtr. In the letter dated

15.11.1979 of the Income Tax department, the

total area of the suit land was mentioned as

832 sq.yards which would be around 690 sq.

mtrs. Accordingly, as per the circle rates

current valuation of the subject land is

around Rs.2,48,40,000/­ i.e. almost four

hundred times more than the valuation of the

property as was at the time of booking of the

flats in the project on the aforesaid

property. The plaintiff/appellants have

claimed a compensation of Rs.1,20,000/­

alongwith interest @ 12% per annum on the

same in all the three suits. It is well

settled that while deciding compensation, the

court should be guided by the principles

stipulated under Section 73 of the Indian

Contract Act. However, the quantum of the

compensation awarded cannot be more than the

amount claimed in the plaint. Plaintiffs have

paid an amount of Rs.11,000/­ in Suit

No.163/81, Rs.11,000/­ in Suit No.177/81 and

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Rs.6,000/­ in specific Suit No.574/89. Thus,

looking to the multi­fold increase in prices

of the property since the booking of the

flats, this Court does not see any reason to

grant a lesser compensation than claimed by

the appellant­plaintiffs in the prayer of the

suits filed by them. Accordingly, all the

three suits of the plaintiffs are decreed to

the extent that the respondents shall pay a

compensation of Rs.1,20,000/­ alongwith

interest @ 12% per annum on the said amount

in all the three suits from the date of

filing of the suits till the date of

realization of the awarded amount.

19. It is well settled that in exercise

of power under Section 100 of the Code of

Civil Procedure, the High Court cannot

interfere with the finding of fact recorded

by the first Appellate Court which is the

final court of fact, unless the same is found

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to be perverse. This Court is in agreement

with the findings arrived at by the Courts

below that,

(i) The Agreement between the parties

was oral and as such the minute details and

the terms of mode of execution of contract

were not reduced in writing and in those

circumstances the contract is not capable

enough as to direct specific performance of

the same.

(ii) The findings of the Trial Court and

Appellate Court being concurrent findings and

decree for specific performance being refused

and alternative prayer for refund of earnest

money deposit and compensation of

Rs.1,20,000/­ alongwith interest @ 12% p.a.

from the date of filing of the suit till the

date of realization of the amount is granted.

(iii) The amendment of 2018, exceptions in

Section 14(3) are deleted. Section 14(1)(d)

has been retained as Section 14(b); a

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contract, the performance of which involves

the performance of a continuous duty which

the Court cannot be supervised. Though in the

amendment of 2018 the exception 14(3) are

deleted, Section 14(1)(d) even amended, the

Specific Relief Act, 2018 will not be helpful

to the appellant modifying or interfering

with the findings recorded by the Courts

below.

(iv) Under Section 20 of the Specific

Relief Act, grant of specific performance of

contract is discretionary. Though the decree

for specific performance is discretionary,

yet the court is not bound to grant such a

relief merely because it is lawful to do so.

But the discretion exercised by the court

should not be arbitrary, but sound and

reasonable, guided by judicial principles of

law and capable of correction by a court of

appeal and should be properly exercised

keeping in view the settled principles of law

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as envisaged in Section 20 of the Act. The

jurisdiction of decreeing specific

performance is a discretion of the court and

it depends upon facts and circumstances of

each case. The court would take into

consideration circumstances of each case,

conduct of the parties, recitals in the

Agreement and the circumstances outside the

contract have to be seen.

20. The Court is conscious of its

limitation while exercising jurisdiction

under Section 100 of the Civil Procedure

Code. Unless the findings are so perverse,

the same cannot be accepted, the Court would

not interfere into the same.

21. In view of the above discussion, both

the Courts below have appreciated the

evidence and came to a conclusion which

cannot be faulted with. The Courts below have

considered the legal position of law and also

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legal position of law post amendment in

Specific Relief Act is considered by this

Court. In furtherance, findings concurrent in

nature this Court is not inclined to

interfere with.

22. With the above observations the second

appeal is dismissed. Consequently the civil

application also stands disposed of.

(VAIBHAVI D. NANAVATI,J) K.K. SAIYED