Full Text
HIGH COURT OF DELHI
JUDGMENT
58889/2025 & CM APPL. 58892/2025 NARESH BATRA .....Appellant
Through: Mr. Aviral Tiwari, Senior Advocate with Mr. Raman Kapur and Mr. Divyansh Singh, Advocates.
Through: Mr. Mayank Goel, Mr. Diganta Das and Ms. Mehakpreet Kaur, Advocates.
HON'BLE MR. JUSTICE HARISH VAIDYANATHAN SHANKAR
1. The present regular first appeal under Section 96 of the Code of Civil Procedure, 1908 [hereinafter referred to as “CPC”] and Section 10 of the Delhi High Court Rules, 1966, has been filed against the judgment dated 22.04.2025 passed by learned Single Judge in CS(OS) 659 of 2011 titled Anand Prakash Bansal v. Naresh Batra whereby the suit of specific performance filed by the Respondent has been decreed in his favour and the Appellant is directed to execute the Sale Deed in favour of the Respondent with respect to the freehold property admeasuring 91.81 square metres, bearing No. 169, Pocket- H-19, Sector 7, Rohini, Delhi [hereinafter referred to as “subject property”].
BRIEF FACTUAL MATRIX
2. Mr. Anand Prakash Bansal/Respondent herein instituted a suit for specific performance for two Agreements to Sell in respect of a subject property. The parties first entered into an Agreement to Sell on 17.09.2010 [hereinafter referred to as “first ATS”] for a agreed total sale consideration of Rs. 2,69,00,000/-.
3. A perusal of the first ATS indicates that the Appellant received Rs. 30,00,000/- as earnest money from the Respondent, which was duly acknowledged through a separate signed receipt. The agreement stipulated that the transaction was set to be completed by or on 14.12.2010, and the balance amount would be paid at the time of final execution and registration of the Sale Deed. The Appellant has not disputed the execution of the first ATS and the receipt of Rs. 30,00,000/- as earnest money.
4. The Respondent has claimed that subsequently, a revised understanding was reached between the parties regarding the timeline and structure of the transaction, pursuant to which another Agreement to Sell was executed on 13.12.2010 [hereinafter referred to as “second ATS”] for the same amount of total sale consideration. The agreement stipulates that the Appellant received an amount of Rs. 81,00,000/- as part-payment up to that date, and the transaction will conclude by or on 31.01.2011. The Respondent states that, on the same date, 13.12.2010, he handed over a cheque for Rs. 25,00,000/-, drawn on Axis Bank, in favour of the Appellant, which was subsequently encashed.
5. The Appellant had received a total amount of Rs. 1,06,00,000/by 13.12.2010, which was substantiated by the Respondent by placing on record the receipts and relevant documents evidencing the payment made. Under the terms of the second ATS, the balance sale consideration was to be paid by the Respondent on or before 31.01.2011 at the time of execution and registration of the Sale Deed before the office of the Sub-Registrar, except Rs. 40,00,000/-, which was to be paid after seven days of execution, at the time of handing over the possession.
6. Clauses 2 and 10 of the second ATS contain certain handwritten insertions. The Respondent asserts that these handwritten clauses were inserted by the Appellant in his own handwriting, along with his signature near the insertions, thereby indicating his agreement to the modified terms, in the presence of the Respondent and a common witness, PW-2.
7. It is the case of the Appellant that he had mortgaged the suit property with a bank against a loan taken for factory premises. Before the registration of the sale deed, the Appellant had to obtain the documents from the bank to hand over the original documents to the Respondent. He asserts that the Respondent agreed to pay the balance sale consideration by November 2010, for the Appellant to clear the loan and also pay for an alternate residence. However, the Appellant claims that the Respondent committed a breach of the agreement dated 17.09.2010 by not making the required payments within the agreed period in accordance with the terms of the first ATS.
8. The Appellant denies the validity and enforceability of the second ATS and claims that the second ATS was not voluntarily entered into and was executed under duress, undue pressure and coercion, and without allowing him to read the contents of the agreement. He denies having written or consented to the insertions added in Clauses 2 and 10 of the agreement.
9. The Respondent has claimed that, in compliance with the terms of the two ATS, the Respondent arranged for the balance payment, obtained the requisite stamp duty papers, prepared the draft sale deed, and presented himself on 31.01.2011 at the office of the Sub-Registrar for execution and registration of the sale deed. However, it is alleged that the Appellant failed to appear on the appointed date, despite repeated assurances, thereby preventing the completion of the transaction.
10. The Respondent thereafter issued a legal notice dated 01.02.2011, calling upon the Appellant to perform his part of the agreement and execute the sale deed, which was duly served on the Appellant on 04.02.2011. The Appellant asserts that he sent a reply to the said legal notice on 10.02.2011, denying all allegations and pointing out that the breach lay entirely on the Respondent.
11. In view of the Appellant‟s alleged default and continued failure to discharge his contractual obligations, the Respondent instituted the suit of specific performance before the learned Single Judge, praying for a decree of specific performance of the agreement dated 13.12.2010, coupled with delivery of possession of the suit property, and further seeking a decree of permanent injunction restraining the Appellant from creating any third-party rights in respect of the subject property.
12. During the pendency of the suit, the Respondent, while complying with the interim directions in the Order dated 18.03.2011, deposited the balance sale consideration amount of Rs. 1,63,00,000/with the Registry of this Court. Subsequently, the amount was released to the Respondent vide Order dated 03.11.2016, after the Respondent filed the requisite undertaking by way of an affidavit to re-deposit the same along with interest as and when directed by the learned Single Judge.
13. The learned Single Judge decreed the suit in favour of the Respondent and against the Appellant vide impugned judgment dated 22.04.2025. It was held that the agreement to sell dated 13.12.2010 [second ATS] is a valid and binding contract, and equities favour the Respondent, who has proved his readiness and willingness to perform his part of the agreement.
14. The Respondent was held entitled to possession of the suit property upon execution and registration of the Sale Deed. The learned Single Judge directed the Appellant to execute the Sale Deed in favour of the Respondent in respect of the suit property within a period of eight weeks from the date of the judgment, upon the Respondent tendering the balance sale consideration of Rs. 1,63,00,000/- (Rupees One Crore Sixty-Three Lakhs only).
15. The Appellant is aggrieved by the above judgement and has filed the present appeal challenging the same.
SUBMISSIONS ON BEHALF OF THE APPELLANT
16. Learned counsel for the Appellant has contended that the Respondent was not ready and willing to perform his part of the agreement. It is stated that the pay order was made by depositing Rs. 22 lakhs in cash and Rs. 45 lakhs through the overdraft facility of the Respondent‟s brother on the same date as the date fixed for execution, and therefore, the Respondent cannot be said to be in possession of the pay order on the morning of 31.01.2011. It is further stated that the pay order was immediately encashed on 01.02.2011. It was pointed out that the stamp paper for registration was printed at 2:07 p.m. on 31.01.2011 at Corporation Bank, Narela, which admittedly is about a distance of 45 minutes from the Sub-Registrar‟s office. It is further claimed that the draft Sale Deed was never prepared, as the same was neither intimated to the Appellant, as admitted by the Respondent in his cross-examination, nor produced before the learned Single Judge. Hence, the Respondent came unprepared to the Sub-Registrar‟s office, if at all, without carrying the requisite documents with him on the date fixed for execution of the sale deed, i.e., 31.01.2011. Further, it is contended that the statement of the Respondent that he made several calls to the Appellant on 31.01.2011 was also unsubstantiated.
17. Learned counsel for the Appellant states that an adverse inference ought to have been drawn against the Respondent as he did not produce the draft Sale Deed on record.
18. Learned counsel submits that DW-2 was not examined to prove the validity of the two ATS as they were not executed in his presence, but only to depose about the incident that happened on 01.02.2011. It is stated that the Appellant and DW-2, particularly in paragraph NO. 31 of the Appellant‟s affidavit and paragraph No. 7-8 of the DW-2‟s affidavit, stated in their affidavits that on 01.02.2011, the Respondent, along with some property brokers, came to the suit property, threatened the Appellant and his family, and sought a refund of the amounts paid. It is also stated that no cross-examination was directed in reference to this.
19. Learned counsel submits that the Appellant produced independent/official witnesses to substantiate the Appellant‟s presence at the Sub-Registrar‟s office on 31.01.2011. It is stated that the evidence included (a) official receipt No. 12260, proved by DW-4 from the Sub-Registrar‟s office, and (b) stamp paper No. 39AA 696388 purchased on the same day, corroborated by DW-5, the stamp vendor, with supporting entry register records.
20. Learned counsel for the Appellant submits that PW-2 was an interested party since he was a broker of the Respondent and was getting commission only from the Respondent, as mentioned in paragraph No. 7 of the replication on behalf of the Respondent. It is submitted that PW-2 attacked the wife of the Appellant on 01.02.2011, which fact went unrebutted by the Respondent during the cross-examination of Appellant and his witnesses.
21. Learned counsel for the Appellant contends that the Respondent has concealed material facts and played fraud with the Appellant and with the Court. He states that there was no intimation by the Respondent to the Appellant that he would appear before the office of Sub-Registrar on 31.01.2011 and that Appellant/Defendant should remain present there for the reason that he did not have the funds available with him on that date. The Respondent also failed to reveal that he had encashed the pay order initially in his pleadings and it was only revealed in the WS of the Appellant
22. The Appellant contends that he regained possession of the title deeds on 15.01.2011, as corroborated by his cross-examination on 08.09.2015. It is further contended that, nevertheless, the possession of title documents by the Appellant was not sine qua non for the execution of the Sale Deed in favour of the Respondent, as the agreements did not prescribe any specific timeline for handing over such documents. He contends that the obligation to first tender the balance sale consideration and thereafter, to seek execution of the Sale Deed lies squarely upon the Respondent, who failed to arrange the requisite funds. It is further stated that the Respondent was fully aware that the suit property stood mortgaged.
23. Lastly, while relying on the above submissions, learned counsel for the Appellant contends that specific performance is an equitable and discretionary remedy, and the Court must exercise such discretion in accordance with sound and reasonable judicial principles. The Appellant has placed reliance on the judgments of the Hon‟ble Supreme Court in Saradamani Kandappan vs. S. Rajalakshmi & Ors. and Shenbagam & Ors. vs. K.K. Rathinavel.
SUBMISSIONS ON BEHALF OF THE RESPONDENT
24. Learned counsel for the Respondent, while vehemently defending the impugned Judgement, has submitted that the Respondent was ready and willing to complete the transaction, and even showed his bona fide by depositing the balance sale consideration in the registry of this Court. He contended that the Respondent presented himself with the non-judicial stamp papers of Rs. 13,45,000/-, a pay order and the draft sale deed.
25. He contends that the Appellant had suppressed a material fact that the property was mortgaged with CITI Bank and the original title documents of the said property were deposited with the said bank. It is submitted that the said fact was revealed for the first time in their written statement at paragraph No. 4(a). It is stated that the Appellant did not present any witness with regard to the loan availed by him and his wife, or the amount of the loan availed from Citibank against the said property. He submitted that even during the cross-examination, no question regarding his knowledge of mortgages was put to the Respondent.
26. While relying on the deposition advanced by the PW-2 that the handwritten additions in the second ATS were made voluntarily by the Appellant in his presence, learned counsel for the Respondent contended that the second ATS was voluntarily executed by the Appellant.
27. Reliance has been placed on the judgment of Beemanemi Maha Lakshmi v. Gangumala Appa Rao[1] and Basavaraj v. Padmavathi[2] ANALYSIS
28. We have given our thoughtful consideration to the submissions made by the parties and, with the able assistance of the learned counsel representing the parties, have perused the paper book.
29. Section 16 of the Specific Relief Act, 1963 provides certain bars to the relief of specific performance. Section 16(c) provides that a person who fails to aver and prove that he has performed and has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than terms the performance of which has been prevented and waived by the Defendant. The Hon‟ble Supreme Court in the judgment of JP Builders v. A Ramadas Rao[3] observed that Section 16(c) mandates „readiness and willingness‟ of the plaintiff and is a condition precedent to obtain the relief of specific performance. The relevant portion of the judgment is extracted hereinbelow:
or has been ready and willing to perform the essential terms of the contract which are to be performed by him.
22. The words “ready” and “willing” imply that the person was prepared to carry out the terms of the contract. The distinction between “readiness” and “willingness” is that the former refers to financial capacity and the latter to the conduct of the plaintiff wanting performance. Generally, readiness is backed by willingness.
23. In N.P. Thirugnanam v. Dr. R. Jagan Mohan Rao [(1995) 5 SCC 115] at SCC para 5, this Court held: (SCC pp. 117-18)
24. In P. D'Souza v. Shondrilo Naidu [(2004) 6 SCC 649] this Court observed: (SCC p. 654, paras 19 and 21) “19. It is indisputable that in a suit for specific performance of contract the plaintiff must establish his readiness and willingness to perform his part of contract. The question as to whether the onus was discharged by the plaintiff or not will depend upon the facts and circumstances of each case. No straitjacket formula can be laid down in this behalf. … ***
21. … The readiness and willingness on the part of the plaintiff to perform his part of contract would also depend upon the question as to whether the defendant did everything which was required of him to be done in terms of the agreement for sale.”
25. Section 16(c) of the Specific Relief Act, 1963 mandates “readiness and willingness” on the part of the plaintiff and it is a condition precedent for obtaining relief of grant of specific performance. It is also clear that in a suit for specific performance, the plaintiff must allege and prove a continuous “readiness and willingness” to perform the contract on his part from the date of the contract. The onus is on the plaintiff.
26. It has been rightly considered by this Court in R.C. Chandiok v. Chuni Lal Sabharwal [(1970) 3 SCC 140] that “readiness and willingness” cannot be treated as a straitjacket formula. This has to be determined from the entirety of the facts and circumstances relevant to the intention and conduct of the party concerned.
27. It is settled law that even in the absence of specific plea by the opposite party, it is the mandate of the statute that the plaintiff has to comply with Section 16(c) of the Specific Relief Act and when there is non-compliance with this statutory mandate, the court is not bound to grant specific performance and is left with no other alternative but to dismiss the suit. It is also clear that readiness to perform must be established throughout the relevant points of time. “Readiness and willingness” to perform the part of the contract has to be determined/ascertained from the conduct of the parties.” (Emphasis supplied)
30. Similarly, the Hon‟ble Supreme Court in the Judgment of His Holiness Acharya Swami Ganesh Dassji v. Sita Ram Thapar[4] observed that the „readiness‟ means the capacity of the Appellant to perform the contract, which would include the financial position to pay the purchase price, and willingness would be determined by the conduct of the plaintiff. The relevant portion is extracted hereinbelow:
31. The first argument raised by the Appellant is regarding the readiness and willingness of the Respondent to perform his obligations under the two ATS. The said argument draws support from the events that allegedly took place on the date fixed by the parties for execution of the sale deed. The Appellant contends that the Respondent did not possess the requisite documents when he appeared before the Sub-Registrar on 31.01.2011, and that, without such documents, his appearance for execution of the Sale Deed was futile.
32. The reading of the above two judgments indicates that the conduct of the plaintiff has to be seen to determine his willingness to perform the obligation under the ATS. We agree with the view taken by the learned Single Judge that the deposit of the amount in the Registry of the Court, pursuant to the direction of the Court, sufficiently proves the financial capacity of the Respondent. Even prior thereto, the Respondent had already paid a substantial sum of Rs.
1.06 crores, evidencing his bona fide to complete this transaction. Furthermore, the existence of a pay order on the scheduled date of the execution of the Sale Deed, coupled with the Respondent‟s ability to withdraw the requisite funds from the bank, clearly establishes his capacity and willingness to make the payment. Accordingly, the contention of the Appellant challenging the readiness and willingness of the Respondent to perform his part of the agreement is without merit and cannot be sustained.
33. Concerning the Appellant‟s argument on adverse inference, no such inference can be drawn merely on account of the draft Sale Deed not being produced, particularly when the Respondent had already shown his due compliance with the terms of the two ATS and had been diligently performing his obligations well before the date fixed for execution of the Sale Deed. In such circumstances, the nonproduction of the draft Sale Deed cannot be construed as a default or lack of readiness and willingness on the part of the Respondent.
34. The Appellant has asserted that DW-2, in his affidavit, corroborated his allegation that the Respondent, accompanied by some property brokers, visited the suit property, threatened the Appellant and his family, and demanded a refund of the amounts paid by the Respondent. However, during his cross-examination, DW-2 deposed that he reached the site only upon hearing commotion and loud noises, and that he was not privy to the conversation that took place between the parties. He further deposed that he could neither admit nor deny whether the Respondent, along with property dealers, had approached the Appellant, with a demand draft of the balance sale consideration in terms of the agreement, and whether they had requested execution of the Sale Deed or inquired into the reasons for the absence of the Appellant before the Sub-Registrar on 31.01.2011. The testimony of DW-2 does not substantiate the claim of the Appellant, and moreover, the evidence is based in part on hearsay, as held by the learned Single Judge and rightly so, and therefore carries limited probative value.
35. The Appellant has merely pleaded that the Respondent did not inform him about appearing before the Sub-Registrar on 31.01.2011, and that amounts to concealment of facts. Such an assertion cannot amount to concealment of material facts, particularly when the date for execution of the Sale Deed was stipulated in the second ATS.
36. Another limb of this contention is that the Respondent has committed fraud on the Court by not disclosing in his plaint that the pay order of Rs. 1.23was encashed the very next day of the scheduled date for execution of the Sale Deed, i.e., 01.02.2011. It is well settled that any person alleging fraud must plead specific particulars in their pleadings as per Order VI Rule 4 of the CPC. Firstly, the allegation is vague and general, and secondly, the Respondent has admitted the same in his replication to the written statement of the Appellant in the suit, and therefore, this contention carries no weight. At the cost of repetition, it was only required to show that the Respondent had the capacity to pay the amount on the date fixed, which the Respondent had duly established.
37. The Appellant has claimed that the testimonies of DW-4 and DW-5 substantiate that he was present at the office of the Subregistrar on 31.01.2011. The evidence includes (a) official receipt NO. 12260, duly proved by DW-4 from the Sub-Registrar‟s office, and (b) stamp paper No. 39AA 696388 purchased on the same day, corroborated by DW-5, the stamp vendor, with supporting entry register records. While such evidence may indicate the Appellant‟s presence, it does not alter the outcome herein, as the Respondent has already established his readiness and willingness. What is material is not the mere presence of the Appellant at the Sub-registrar‟s office, but the conduct reflecting readiness and willingness to perform the obligation under the agreement. The civil cases rest on the preponderance of probabilities, and in the present case, the balance of probabilities tilts in favour of the appellant
38. The Appellant has claimed that the Respondent was aware of the suit property being mortgaged; however, he is unable to substantiate any proof to support his claim. There is no reference to the mortgage of the sale property in the two ATS. The original Sale Deed is required to establish the legal ownership of the Appellant and the legitimacy with regard to the subject property; therefore, it cannot be said that the title documents were not essential for the execution of the Sale Deed in favour of the Respondent.
39. Beyond the above, learned counsel for the parties have not advanced any other submissions. Keeping in view the aforegoing discussion, the appeal is dismissed on the ground of lacking merit.
40. The appeal, along with pending application, if any, is disposed of. ANIL KSHETARPAL, J. HARISHVAIDYANATHANSHANKAR, J. SEPTEMBER 26, 2025 sp/er