A.C. ARULAPPAN . versus SMT. AHALYA NAIK

Citation: [2001] SUPP. 1 S.C.R. 425 · Decided: 10-08-2001 · Supreme Court of India · Bench: S. RAJENDRA BABU · Disposal: Disposed off

Judgment (excerpt)

A.C~ARULAPPAN . 
A 
V. 
SMT. AHAL YA NAIK 
AUGUST 10, 2001 
[S. RAJENDRA BABU AND K.G. BALAKRISHNAN, JJ.] 
B 
Specific Relief Act, 1963-Section 20-Agreement for sale of property 
between the parties-Sale deed not executed-Another agreement for sale 
entered into stipulating the time limit for execution-Suit for specific relief-
Held, Court jurisdiction to decree specific relief is discretionary and should C 
not be exercised in an arbitrary or unreasonable manner-On facts, 
respondent tried to take unfair advantage over the appellant-Not entitled 
to a decree of specific performance. 
Appellant entered into an agreement with respondent to sell suit- D 
property for certain consideration in May 1977. Respondent paid a sum of 
Rs. 42,000 as advance. No time limit was stipulated for execution of sale 
deed. The agreement was entered into by the appellant to pay off his debts 
as disclosed in the agreement. Another agreement was entered into by the 
appellant with the respondent stipulating the execution of sale deed by January 
1978. The respondent filed a suit for specific performance before trial court E 
alleging that the appellant failed to execute the sale deed by January 1978 
as per the second agreement. The trial court dismissed the suit. The res.pondent 
filed an appeal before High Court, which was decreed. 
In appeal to this Court, the appellant contended that the respondent 
wrote two letters for termination of the first agreement and for repayment F 
of advance with interest; and that the second agreement entered into was 
brought about by coercion and threat by the respondent, through her husband. 
Disposing of the app~als, the Court 
HELD: 1.1. The jurisdiction to decree specific relief is discretionary G 
and Court can consider various circumstances to decide whether such relief 
is to be granted. Merely because it is lawful to grant specific relief, the 
Court need not grant the orde'r for specific relief; but this discretion shall 
not be exercised in an arbitrary or unreasonable manner. Certain 
circumstances have been mentioned in Section 20(2) of the Specific Relief H 
425 
426 
SUPREME COURT REPORTS [2001] SUPP. I S.C.R. 
, 
A Act, 1963 as to the circumstances under which court shall exercise such 
discretion. If under the terms of the contract the plaintiff gets an unfair 
advantage over the defendant, the court may not exercise its discretion in 
favour of the plaintiff. So also, specific relief may not be granted if the 
defendant would be put to undue hardship which he did not foresee at the time 
B of agreement. If it is inequitable to grant specific relief, then also the court 
would desist from granting a decree to the plaintiff. (429-C, DJ 
1.2. From the terms and conditions adumbrated in the second 
agreement, the respondent had been trying to take an unfair advantage over 
the appellant and that the circumstances, in which this agreement was 
C executed within a short period of termination of the first contract by the 
respondent, make it highly probable that the appellant might not have readily 
agreed to this contract. [431-El 
1.3. There are other circumstances also to hold that the respondent 
had not approached the court with clean hands. The respondent had been 
D trying to get possession of the house even before execution to the sale deed, 
for which the respondent had apparently colluded with the tenant of the 
appellant. Moreover, the appellant was clearly in impecunious circumstances 
and loans were outstanding against him. He had executed the first agreement 
to raise some funds to pay off the debts. From the tenor of the first agreement, 
E it is seen that the parties were not very serious about the sale of the house. 
The fact that after few months the respondent resiled from the agreement 
and sought for repayment of the money also proves this fact. The appellant 
had voluntarily retired from service. Admittedly, he had no other house to 
stay after retirement. The respondent had tried to take unfair advantage over 
the appellant and throughout the course of the transaction the respondent 
F had not been fair. [431-F, H; 432-A, BJ 
1.4 Granting of specific performance is an equitable relief, though 
the same is governed by the statutory provisions of the Specific Relief Act, 
1963. These equitable principles are nicely incorporated in Section 20 of the 
Act. While granting a decree for specific performance, these salutary 
G guidelines shall be in the forefront of the mind of

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