V. PECHIMUTHU versus GOWRAMMAL

Citation: [2001] SUPP. 1 S.C.R. 199 · Decided: 01-08-2001 · Supreme Court of India · Bench: V.N. KHARE · Disposal: Appeal(s) allowed

Judgment (excerpt)

... 
V. PECHIMUTHU 
A 
v . 
GOWRAMMAL 
AUGUST I, 2001 
[V.N. KHARE AND RUMA PAL, JJ.] 
B 
Specific Relief Act, 1963: Sections 16 and 20. 
Specific Performance-Suit for-Sale of immovable property-Agreement 
for-Owner sold his immovable property to purchaser-Purchaser agreed to C 
sell property back to owner after 5 years for a certai" sum-Owner willing to 
perform his part of the contract and asked seller to re-convey the property--
Suit filed for specific performance-Trial court decreed the suit-First appellate 
court confirmed the decree-However, High Court, in second appeal, reversed 
the concurrent findings of fact by holding that the re-purchase agreement was D 
a privilege or concession; and that the agreement was not an ordinary 
agreement-Correctness of-Held: There is no distinction between an 
agreement to re-purchase and an ordinary agreement of purchase-The 
agreement still remains an agreement for sale of immovable property and 
must be governed by the same law relating to ordinary agreement-Owner is 
entitled to specific performance of agreement-Hence, High Court erred in E 
reversing the decree of specific performance. 
Specific Performance-Decree for-Rise in price of suit property--
Relevancy of-Held, while granting decree of specific performance for the 
first time rise in price of suit property may be a relevant factor in denying the 
relief-But when the decree is passed by the trial court and affirmed by first 
appellate court such a factor is not relevant in second appeal. 
Code of Civil Procedure, 1908: 
F 
Section l DO-Second Appeal-Concurrent findings of fact-Reversal of-
,,, .;econd appeal-On a point not raised at any stage of the proceedings- G 
Co1-rectness of-Held, High Court should not have permitted raising of an 
inronsistent argument at the stage of the second appeal-Hence, setting aside 
o.; ·concurrent findings of fact not justified-Contract A ct, 18 7 2: 
Contracts-Agreement with option to re-purchase and ordinary H 
199 
200 
SUPREME COURT REPORTS (2001] SUPP. I S.C.R. 
A agreement-Distinction between-Owner sold property to purchaser-
Subsequently, purchaser agreed to sell property back to owner for a certain 
sum-Held, subsequent agreement is an ordinary agreement and is governed 
by the same law relating to ordinary agreement. 
B 
Words and Phrases: 
"Privilege" and "concession "-Meaning of 
The appellant was the owner of a certain immovable property, which 
was sold to the respondent. By a subsequent agreement the respondent agreed 
to sell the property back to the appellant after 5 years for a certain sum. After 
C the expiry of five years the appellant made repeated demands on the 
respondent asking her to r~convey the property in terms of the agreement. 
The appellant also expressed his readiness and willingness to perform his part 
of the contract. But there was no response from the respondent. 
Thereafter the appellant filed a suit for specific performance under the 
D Specific Performance Act, 1963, which was decreed. The first appellate court 
affirmed the decree with certain modifications. But the High Court, in second 
appeal under Section 100 of the Code of Civil Procedure, 1908 reversed the 
concurrent findings of fact on a construction of the plaint that the right of 
re-conveyance was a concession or a privilege granted to the original owner 
E and that, therefore, not only must the terms of such an agreement be strictly 
construed against the appellant, but also unlike "ordinary" agreements for 
sale, time would be of the essence of the contract. It was also held that the 
appellant claiming re-conveyance had to strictly perform the agreement before 
the right would be enforced and that the appellant had not come to the Court 
with clean hands. Hence this appeal. 
F 
G 
The following question arose before this Court:-
Whether the High Court was justified in setting aside a concurrent 
finding of fact with the limits prescribed by Section 100 of the Code of Civil 
Procedure, 1963? 
Allowing the appeal, the Court 
HELD: I. I. It is not a general principle of law that every agreement of 
sale by which the original owner agrees to buy back the property is a privilege 
or a concession granted to such owner. A privilege has been defined as a 
H particular and peculiar benefit or advantage enjoyed by a person, and a 
.. 
', 
V. PECHIMUTHU v. GOWRAMMAL 
201 
concession as a form of privilege. An option to purchase or repurchase is such A 
privilege or concession. (208-A] 
K. 

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