Gauhati High Court Sets Aside Trial Court’s Judgment in Property Dispute for Non-Compliance with Readiness and Willingness Requirement Under the Specific Relief Act, Remands Case for Fresh Consideration

Court’s Decision:

The appeal was allowed, and the trial court’s judgment and decree dated 20.08.2022 were set aside. The case was remanded to the trial court to properly frame and consider an essential issue—whether the respondent (the plaintiff in the trial court) was ready and willing to perform his contractual obligations under the sale agreement.

The trial court was instructed to:

1. Frame proper issues related to the readiness and willingness of the plaintiff (respondent in appeal).
2. Allow both parties to present additional evidence on this point, if necessary.
3. Deliver a fresh judgment after considering all evidence, including any newly submitted material.

Facts:

• The case concerns a dispute over a property sale agreement between the appellant (defendant in the trial court) and the respondent (plaintiff in the trial court).
• The appellant was the owner of certain properties and allegedly agreed to sell them to the respondent for ₹25 lakhs.
• An agreement for sale was executed in August 2017, and the respondent paid an advance of ₹5 lakhs.
• The remaining ₹20 lakhs was to be paid at the time of sale deed registration, after the appellant obtained the necessary sale permissions within three months.
• The respondent repeatedly requested the appellant to execute the sale deed, but she delayed the process.
• Upon investigating the delay, the respondent discovered that the appellant had filed an objection against the sale with the relevant authority.
• The appellant denied having agreed to the sale, claiming that she had only borrowed ₹5 lakhs from the respondent and that the agreement was obtained by coercion.
• The trial court ruled in favor of the respondent, granting a decree for specific performance, which led the appellant to file this appeal.

Issues:

The trial court framed eight issues to determine the matter:

1. Whether there was a valid cause of action for the suit.
2. Whether the parties entered into a valid sale agreement on 14.08.2017.
3. Whether the appellant’s signatures on the sale agreement were obtained by force.
4. Whether the appellant took ₹5 lakhs as a loan and intended to return it.
5. Whether the appellant would become homeless if the property was sold.
6. Whether the sale agreement was forged.
7. Whether the respondent was entitled to specific performance of the contract.
8. What other reliefs the parties were entitled to.

However, the High Court found that the trial court failed to frame an issue concerning the respondent’s readiness and willingness, which was crucial for deciding a case under the Specific Relief Act.

Petitioner’s (Respondent’s in Appeal) Arguments:

• The agreement was legally valid, and the respondent had made an advance payment in good faith.
• He had consistently asked the appellant to execute the sale deed, but she refused to comply.
• The appellant’s objection to the sale permission was a deliberate attempt to escape her obligations.
• Since Section 16(C) of the Specific Relief Act requires a plaintiff to prove readiness and willingness, he argued that he met the conditions and was entitled to specific performance of the contract.

Respondent’s (Appellant’s in Appeal) Arguments:

• The appellant denied ever agreeing to sell the property and claimed that she only borrowed ₹5 lakhs from the respondent.
• She alleged that the respondent forcibly obtained her signatures on blank stamp papers, which were later misrepresented as a sale agreement.
• The sale permission process was not handled by her but by the respondent, who allegedly involved another buyer (Tapan Barai) without her consent.
• She attempted to return the ₹5 lakhs, but the respondent refused to accept it, insisting on proceeding with the sale.
• The trial court wrongly framed unnecessary issues, such as whether she would become homeless, instead of focusing on readiness and willingness.

Analysis of the Law:

• The case was governed by Section 16(C) of the Specific Relief Act, 1963, which states that a plaintiff must prove that they were ready and willing to perform their obligations under a contract.
• Readiness refers to financial capability, whereas willingness involves the plaintiff’s consistent behavior aligning with the contract terms.

Precedent Analysis:

• The Supreme Court in Man Kaur v. Hartar Singh Sangha (2010) 10 SCC 512 held that in suits for specific performance:
  • The plaintiff must prove readiness and willingness through personal testimony.
  • This includes demonstrating financial capability and genuine intent to execute the contract.
  • A third party (such as an attorney-holder) cannot testify on the plaintiff’s readiness and willingness.
  • A failure to prove both readiness and willingness can result in the dismissal of the suit.

Court’s Reasoning:

• The trial court failed to frame the most crucial issue—whether the respondent was ready and willing to perform his obligations.
• Because of this procedural defect, neither party had the opportunity to present evidence on this point.
• The respondent did not explicitly prove his readiness and willingness, nor was he cross-examined on it.
• The appellant’s claim that her signatures were obtained by force was contradicted by her own reply to a legal notice, where she admitted to executing the agreement.
• The trial court framed unnecessary issues, such as whether the appellant would become homeless, which diverted attention from the core legal question.
• Since framing proper issues is essential in civil suits, the High Court intervened to correct the trial court’s approach.

Conclusion:

• The trial court’s judgment was set aside, and the case was remanded for proper framing of issues.
• The trial court must now consider the respondent’s readiness and willingness before making a fresh judgment.
• Both parties will be given the opportunity to present additional evidence if necessary.
• The trial court must decide the case afresh based on all available evidence.

Implications:

• The judgment highlights the critical role of issue framing in civil cases, particularly in specific performance suits.
• It reinforces the requirement that plaintiffs seeking specific performance must unequivocally prove their readiness and willingness.
• Courts must avoid unnecessary issues and focus on the essential legal questions to ensure justice.
• The ruling serves as a cautionary precedent for courts to follow proper procedural safeguards in contract enforcement disputes.

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