Supreme Court Denies Specific Performance Claim Due to Delay and Lack of Readiness

The case of Rajesh Kumar vs. Anand Kumar & Others deals with a significant dispute regarding a real estate transaction where the plaintiff sought specific performance of a sale agreement. The Supreme Court, in its judgment dated May 17, 2024, upheld the decision of the Madhya Pradesh High Court, dismissing the plaintiff’s suit due to non-compliance with essential legal requirements, delay in filing, and failure to establish readiness and willingness to perform the contract.

Background of the Case

The dispute arose over 145.60 acres of land in Khirsau, Tehsil Sihora, District Jabalpur, Madhya Pradesh. The appellant, Rajesh Kumar, entered into an agreement to purchase the land at ₹3,000 per acre, totaling ₹4,41,000. The agreement was executed with Respondent No. 4, who acted as the Power of Attorney holder for Respondent Nos. 2 to 11.

The agreement specified that:

An earnest money deposit of ₹41,000 was paid upfront.
Additional payments of ₹20,000 (May 22, 1996) and ₹40,000 (June 30, 1996) were endorsed on the agreement.
The sale deed was to be executed within six months but was extended to March 31, 1997, and later to May 31, 1997.

However, on May 14, 1997, the Power of Attorney holder executed a sale deed in favor of Respondents Nos. 1 to 3, who became bona fide purchasers. This sale took place despite the extension of the agreement with Rajesh Kumar.

Legal Proceedings

Upon learning of the sale, Rajesh Kumar:

Issued a legal notice on May 30, 1997, demanding execution of the sale deed.
Was informed at the Sub-Registrar’s office that the property had already been sold.
Objected to the mutation of names in revenue records in August 1997.
Filed a suit for specific performance on June 19, 2000.

The Trial Court ruled in favor of Rajesh Kumar, finding that:

The agreement to sell was valid.
The plaintiff had paid the required earnest money.
The suit was filed within the limitation period.

However, the Madhya Pradesh High Court overturned this decision, ruling that:

The agreement was not executed by all landowners.
The plaintiff failed to personally testify in court, relying instead on a Power of Attorney holder.
The claim was invalid as the land was sold to bona fide purchasers.

Arguments by the Petitioner (Rajesh Kumar)

Rajesh Kumar’s counsel argued that:

The agreement was legally binding as the Power of Attorney holder acted on behalf of all landowners.
The High Court erred in dismissing the agreement’s validity.
Failure to personally testify should not invalidate the case.
The suit was filed within the limitation period.

Arguments by the Respondents

The respondents countered that:

The agreement was void as it was not executed by all co-owners.
The plaintiff failed to appear in court, making his claims unverified.
The property was legally transferred to bona fide purchasers.
The plaintiff did not show readiness and willingness to perform the contract.

Supreme Court’s Observations

The Supreme Court ruled against the plaintiff, citing multiple legal deficiencies:

1. Lack of Execution by All Owners

The Court noted:

“The agreement did not mention the names of all co-owners. Without their signatures or explicit authorization, the agreement cannot be enforced.”

2. Failure to Testify

The Court emphasized:

“The plaintiff’s personal appearance is necessary to prove readiness and willingness. A Power of Attorney holder cannot testify in his place.”

3. Long Delay in Filing the Suit

The Court referenced past rulings, stating:

“Even if a suit is filed within the limitation period, undue delay indicates a lack of genuine intent.”

Key Findings and Judgment

The Supreme Court upheld the High Court’s decision, stating:

The plaintiff failed to prove readiness and willingness to perform his obligations.
The agreement was not enforceable due to missing co-owner consent.
The sale to bona fide purchasers was legally valid.

Accordingly, the Court dismissed the appeal, stating:

“The High Court was correct in setting aside the Trial Court’s judgment. The suit was filed after unreasonable delay, and the agreement lacked validity.”

Implications of the Judgment

The ruling has several key takeaways:

Validity of Agreements: All co-owners must be parties to a sale agreement.
Testimony Requirement: Plaintiffs must personally testify in specific performance suits.
Timely Action: Filing within limitation alone is not sufficient; prompt legal action is necessary.
Bona Fide Purchasers: Property sales to bona fide third parties hold legal weight.

Conclusion

The Supreme Court’s decision in Rajesh Kumar vs. Anand Kumar & Others reinforces the principles of contract law, ensuring that real estate transactions adhere to legal requirements. By upholding the importance of readiness, willingness, and prompt legal action, the judgment provides clarity on the enforceability of sale agreements in property disputes.

Petitioner Name: Rajesh Kumar.
Respondent Name: Anand Kumar & Others.
Judgment By: Justice Pankaj Mithal, Justice Prashant Kumar Mishra.
Place Of Incident: Jabalpur, Madhya Pradesh.
Judgment Date: 17-05-2024.

Don’t miss out on the full details! Download the complete judgment in PDF format below and gain valuable insights instantly!

Download Judgment: rajesh-kumar-vs-anand-kumar-&-others-supreme-court-of-india-judgment-dated-17-05-2024.pdf

Directly Download Judgment: Directly download this Judgment

See all petitions in Contract Disputes
See all petitions in Property Disputes
See all petitions in Specific Performance
See all petitions in Damages and Compensation
See all petitions in Judgment by Pankaj Mithal
See all petitions in Judgment by Prashant Kumar Mishra
See all petitions in dismissed
See all petitions in supreme court of India judgments May 2024
See all petitions in 2024 judgments

See all posts in Civil Cases Category
See all allowed petitions in Civil Cases Category
See all Dismissed petitions in Civil Cases Category
See all partially allowed petitions in Civil Cases Category