Delay and Suppression of Material Facts Fatal to Specific Performance Claims: Madras HC

The Madras High Court recently affirmed that a party seeking specific performance must establish consistent readiness and willingness from the date of the contract until the hearing, ruling that a three-year delay in filing a suit despite being within the limitation period can be fatal to the claim.

In an insightful judgment delivered by a bench comprising Justice C.V. Karthikeyan and Justice K. Rajasekar, the Court dismissed an appeal filed by plaintiffs who sought to enforce four sale agreements concerning undivided shares of a property in Puducherry. The Court found that the plaintiffs failed to justify a long period of inactivity after the defendants had explicitly cancelled the agreements.

Establishing Readiness and Willingness Under the Specific Relief Act

The Court emphasized that under Section 16(c) of the Specific Relief Act, 1963, the burden lies heavily on the purchaser to prove they were ready and willing to perform their part of the contract throughout the duration of the agreement. The bench noted that while time is generally not the essence of contracts involving immovable property, the specific timelines mentioned in agreements must be given significance.

The Court, in its reasoning, observed: "It is well settled that when a party seeking the relief of specific performance, it is the duty on the part of the party to establish as per Section 16(c) of the Specific Relief Act, 1963, that he was ready and willing to perform his part of the contract from the date of contract to the date of hearing of the suit... Their conduct shows that the last rejoinder notice was received by them as early as on 05.01.2005 and only in the year 2007, the plaintiffs have come forward to file the suit, it clearly shows that the plaintiffs were not ready and failed to establish their readiness."

Impact of Suppression of Material Facts

Another critical factor in the dismissal was the suppression of a second sale agreement (Ex.B.3) executed on the same day as another agreement but for a significantly higher sale consideration. The Court held that such suppression disentitles a party from seeking discretionary relief in equity.

The Court has the following directions:

"Accordingly, this appeal is dismissed and the judgment and decree dated 24.10.2014 in O.S.No.42 of 2007 is hereby confirmed. Consequently, connected civil miscellaneous petition stands closed. There shall be no order as to costs."

Background:

The dispute arose from four agreements of sale entered in 2004 by the plaintiffs to purchase a total of 5/7th shares in a property from various branches of the legal heirs of one Suppuraya Kounder. The plaintiffs paid advance amounts but failed to pay the balance consideration within the stipulated one-month to sixty-day windows.

The plaintiffs argued that they were waiting for the defendants to produce title documents and cited the pendency of a partition appeal in the High Court as a reason for the delay. However, the defendants issued several legal notices in late 2004 and early 2005, calling upon the plaintiffs to conclude the sale or face cancellation. The agreements were eventually cancelled by the defendants in January 2005. The plaintiffs only approached the Trial Court in June 2007.

In its analysis, the High Court relied on Chand Rani vs. Kamal Rani ( "(1993) 1 SCC 519": 1992 CaseBase(SC) 510) to reiterate that time, while not usually of the essence, must be viewed in the context of rising urban property values. The Court also referred to Saradamani Kandappan vs. S. Rajalakshmi and Others, which suggested that courts must apply greater scrutiny to 'readiness and willingness' in an era of inflation. Relying on P. Meenakshisundaram vs. P. Vijayakumar and Another ( "(2018) 15 SCC 80": 2018 CaseBase(SC) 1175), the Court confirmed that even if a suit is within the three-year limitation period, the court may 'frown' upon it if it is not filed immediately after a breach or refusal.

Case Details:
Case No.: A.S. No.68 of 2015
Case Title: Mohan and Another v. Kasthuri @ Avani and Others
Appearances:
For the Petitioner(s): Mr. T.R. Rajagopal (Senior Advocate) For Mr. G. Veerapathiran
For the Respondent(s): Mr. V. Raghavachari (Senior Advocate) For M/s. V. Srimathi (For RR 4 to 7)

Source: 2026 CaseBase(MAD) 277