BALASAHEB DAYANDEO NAIK (DEAD) THROUGH LRS & ORS. versus APPASAHEB DATTATRAYA PAWAR

Citation: [2008] 1 S.C.R. 1169 · Decided: 24-01-2008 · Supreme Court of India · Bench: ARIJIT PASAYAT · Disposal: Case Allowed

Judgment (excerpt)

A 
B 
(2008) 1 S.C.R. 1169 
BALASAHEB DAYANDEO NAIK (DEAD) 
THROUGH LRS & ORS. 
v. 
APPASAHEB DATTATRAYA PAWAR 
(Civil Appeal No. 647 of 2008) 
JANUARY 24, 2008 
[DR. ARIJIT PASAYAT AND P. SATHASIVAM, JJ] 
Specific Relief Act, 1963 -Agreement to sell land - Non-
e execution of - Suit for specific performance - Grant of decree 
and plea of seller that time was essence of contract rejected -
However, High Court setting aside the decree - Validity of -
Held: Recital in the agreement that earnest money would be . 
forfeited upon failure to execute agreement within stipulated 
D period makes it clear that parties never intended time to be 
essence of contract - More so, seller did not prove his plea -
Thus, decree granted by trial court upheld - Buyer directed to 
deposit balance consideration amount and seller would 
execute sale deed. 
E 
The respondent-defendant entered into an 
agreement for sale of agricultural lands to the appellant-
plaintiffs for a consideration amount. The sale deed was 
to be executed by the defendant within six months and 
the possession of lands was to be delivered at the time of 
F execution of sale deed. The plaintiffs paid the earnest 
money and balance amount was to be paid at the time of 
execution of sale deed. However, the defendant did not 
execute the agreement. The plaintiffs filed suit for specific 
performance of agreement. The trial court decreed the suit 
G holding that the defendant failed to prove that time was 
the essence of contract and the plaintiffs were and are 
ready and willing to perform their ·part of contract. The 
High Court set aside the orcier of trial court. Hence the · 
· present appeal. 
H 
1169 
BALASAHEB D. NAIK (DEAD) THROUGH LRS & ORS. 
1170 
v. APPASAHEB D. PAWAR 
1 
Allowing the appeal, the Court 
A 
HELD: 1.1 In the case of sale of immoveable property, 
there is no presumption as to time being the essence of 
the contract. Even where the parties have expressly 
provided that time is the essence of the contract, such a B 
stipulation will have to be read along with other provisions 
of the contract. [Para 1 OJ [1176-E] 
1.2 The defendant in his written statement made a 
bald claim that the time was the essence of contract. Even 
if the recital in the agreement of sale is accepted that the c 
sale deed has to be executed within a period of six 
months, there is an express provision in the agreement 
itself that failure to adhere the time, the earnest money 
will be forfeited. In such circumstances and in view of 
recital pertaining to forfeiture of the earnest money makes D 
it clear that time was never intended by the parties to be 
of essence. [Para 13] [1178-E & F] 
1.3 The appellants/plaintiffs clearly established their 
claim to secure specific performance of the agreement 
by leading cogent evidence whereas the respondenU E 
defendant having pleaded that time was the essence of 
the contract neither entered the witness box nor led any 
evidence whatsoever. The defendant did not bother to 
prove his claim on oath before the Court to the effect that 
it was the plaintiffs who avoided performing their part of F 
contract. Neither the terms of agreement nor the intention 
of the parties indicate that the time is an essence of the 
agreement. All the above-mentioned material aspects were 
correctly appreciated by the trial court and unfortunately 
the High Court lost sight of the above material aspect and G 
the conduct of the defendant in not strengthening his plea 
r 
by placing acceptable evidence. In such circumstances, 
' 
the High Court should have upheld the decree of specific 
performance granted by the trial Court. [Paras 12 and 13] 
[1177-G; 1178-A, D, H; 1179-A] 
H 
1171 
SUPREME COURT REPORTS 
[2008] 1 S.C.R. 
A 
1.4 When the third plaintiff deposed before the Court 
explaining their case with reference to the recitals in the 
agreement of sale including the reference to the legal 
notice to the defendant, in the absence of contra evidence 
on the side of the defendant, the conclusion arrived at by 
B the High Court in non-suiting the plaintiff cannot be agreed. 
[Para 13] [1179-A & B] 
1.5 The claim for refund of earnest money by the 
plaintiffs is only their alternative claim. It is not in dispute 
that in all suits for specific performance, the plaintiff is 
C entitled to seek· alternative relief in the event the decree 
for specific performance cannot be granted for any 
reason, hence there is no infirmity in the alternative plea 
of refun

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