JANARDAN DAS & ORS.versusDURGA PRASAD AGARWALLA & ORS.

            [2024] 9 S.C.R. 947 : 2024 INSC 778

                   Janardan Das & Ors.
                            v.
               Durga Prasad Agarwalla & Ors.
                  (Civil Appeal No. 613 of 2017)
                        26 September 2024
[Vikram Nath, Pankaj Mithal and Prasanna B. Varale, JJ.]


                      Issue for Consideration
  Issue arose as to whether the plaintiffs proved their continuous
  readiness and willingness to perform their part of the contract
  as mandated u/s.16(c) of the Specific Relief Act, 1963; whether
  the agreement to sell was valid and enforceable against three
  co-owners-sisters, considering that defendant no. 1-co-owner
  lacked the authority to act on their behalf without a valid and
  subsisting General Power of Attorney; and whether the relief of
  specific performance, being discretionary, having been denied by
  the trial court was rightly granted by the High Court.

                             Headnotes†
  Specific Relief Act, 1963 – s.16(c) – Specific performance
  of contract – Enforcement – Readiness and willingness of
  the plaintiffs to perform the contract – Devolution of suit
  property among five heirs-two brothers and three sisters
  equally – Plaintiffs operating a petrol pump on the suit land
  allegedly entered into an agreement to sell with defendant
  No. 1 and his brother for the purchase of the suit property for
  consideration – Agreement stipulated that the sisters-co-owners
  would execute the sale deed within three months as they had
  not joined the agreement – Plaintiffs filed suit for specific
  performance of the agreement – Said agreement was executed
  solely by the brothers-two co-owners without any signatures,
  written consent, or explicit authorization from the sisters-three
  co-owners – Meanwhile, all the co-owners of the property
  transferred the suit property in favour of the appellants by
  virtue of a sale deed for consideration – Suit dismissed by
  the trial court, however, the High Court decreed the suit in
  favour of the plaintiffs – Correctness:
  Held: Plaintiffs’ failure to comply with the essential terms of the
  agreement and to take necessary steps within the stipulated time
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       demonstrates a lack of readiness and willingness to perform their
       part of the contract as mandated u/s.16(c), which is fatal to their
       claim for specific performance – High Court erred in overlooking
       the plaintiffs’ inaction and lack of diligence – Further, defendant
       No. 1-co-owner lacked the authority to bind other three co-owners-
       sisters in the agreement to sell – General Power of Attorney did
       not confer upon him the power to sell the property on behalf of his
       sisters at the time of the agreement, having been impliedly revoked
       by the partition deed – Plaintiffs’ knowledge of the necessity of
       obtaining the sisters’ consent, coupled with their failure to secure
       such consent, renders the agreement ineffective against the sisters,
       and cannot be specifically enforced against them, and the plaintiffs
       cannot claim any right over their shares in the property based on
       the said agreement – Appellants are the bona fide purchasers
       in good faith of the suit property for valuable consideration –
       Once they have acquired the rights in the property way back, no
       justification to disturb the said sale deed by decreeing the suit for
       specific performance of the agreement – Thus, considering the
       discretionary nature of the relief and the principles governing its
       exercise, granting specific performance would be neither just nor
       equitable – Plaintiffs’ failure to fulfil essential contractual terms,
       coupled with the lack of authority to bind all co-owners, renders
       the grant of specific performance inappropriate – Equitable remedy
       sought by the plaintiffs cannot be granted in light of their conduct
       and the circumstances of the case – Given the incomplete and
       unenforceable nature of the agreement, it is neither just nor
       equitable to grant the relief sought by the plaintiffs – Thus, the
       judgment and decree passed by the High Court set aside and
       that of the trial court dismissing the suit for specific performance
       restored. [Paras 9-25]

       Specific Relief Act, 1963 – s.16(c) – Specific performance of
       contract – Enforcement – Readiness and willingness of the
       plaintiffs to perform the contract:
       Held: s.16(c) mandates that a plaintiff seeking specific performance
       of a contract must aver and prove that they have performed or
       have always been ready and willing to perform the essential
       terms of the contract which are to be performed by them – This
       requirement is a condition precedent and must be established by
       the plaintiff throughout the proceedings – Readiness and willingness
       of the plaintiff are to be determined from their conduct prior to
       and subsequent to the filing of the suit, as well as from the terms
[2024] 9 S.C.R.                                                               949

         Janardan Das & Ors. v. Durga Prasad Agarwalla & Ors.


     of the agreement and surrounding circumstances – Rationale
     behind this provision is to ensure that a party seeking equitable
     relief has acted equitably themselves – Specific performance is a
     discretionary relief, and the plaintiff must come to the court with
     clean hands, demonstrating sincerity and earnestness in fulfilling
     their contractual obligations – Any laxity, indifference, or failure to
     perform their part of the contract can be a ground to deny such
     relief. [Para 8]

     Power of Attorney – General Power of Attorney – When can
     agent bind the principals to contract of sale:
     Held: In contracts involving multiple owners of property, it is
     imperative that all co-owners either personally execute the
     agreement to sell or duly authorize an agent to act on their
     behalf through a valid and subsisting power of attorney – Agent’s
     authority must be clear and unambiguous, and any limitations or
     revocations of such authority must be duly considered – Without
     proper authority, an agent cannot bind the principals to a contract
     of sale. [Para 14]

     Specific Relief Act, 1963 – s.20 – Relief of specific performance
     under – Nature of:
     Held: Relief of specific performance is discretionary in nature –
     s.20 explicitly states that the court is not bound to grant such relief
     merely because it is lawful to do so – But the discretion of the
     court has to be on sound and reasonable principles – Discretion
     must be exercised judiciously and based on sound principles,
     ensuring that granting specific performance is just and equitable
     in the circumstances of the case. [Paras 19, 21]

                               Case Law Cited
     U.N. Krishnamurthy v. A.M. Krishnamurthy [2022] 13 SCR 250 :
     (2023) 1 SCC 775 – referred to.

                                  List of Acts
     Specific Relief Act, 1963.

                              List of Keywords
     Continuous readiness and willingness to perform part of contract;
     Agreement to sell; General Power of Attorney; Specific performance;
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       Sale deed; Consideration; Multiple parties; Distinct interests;
       Bona fide purchasers in good faith; Equitable relief; Contractual
       obligations; Contracts; Agent binding principals to contract of sale;
       Judicious exercise of discretion; Grant of specific performance.

                              Case Arising From
       CIVIL APPELLATE JURISDICTION: Civil Appeal No. 613 of 2017
       From the Judgment and Order dated 25.10.2013 of the High Court
       of Orissa at Cuttack in FA No. 185 of 1997.

                           Appearances for Parties
       Umakant Misra, Mrs. Prabhati Nayak, Niranjan Sahu, Monomoy
       Basu, Ms. Apoorva Sharma, Advs. for the Appellants.
       S.R. Singh, A.C. Pradhan, Sr. Advs., Saurabh Mishra, Shrimay
       Mishra, Abhinav Pandey, Advs. for the Respondents.

                  Judgment / Order of the Supreme Court

                                      Order

1.     The present appeal arises from the judgment and order dated
       25.10.2013 passed by the High Court of Orissa at Cuttack in First
       Appeal No. 185 of 1997, wherein the High Court reversed the
       judgment of the Civil Judge (Senior Division), Baripada, dated
       17.05.1997 in T.S. No. 103 of 1994. The High Court decreed the suit
       for specific performance filed by the plaintiffs (Respondent Nos. 1 & 2
       herein), directing the defendants, including the present appellants
       (Defendant Nos. 9 to 11), to execute a sale deed in favour of the
       plaintiffs. Aggrieved by this decision, the defendant nos. 9 to 11 have
       approached this Court by way of the present appeal.
2.     The relevant facts giving rise to the original suit are as follows:
       2.1 Late Surendranath Banerjee was the original owner of the suit
           property situated in Baripada, Odisha. Upon his demise on
           03.07.1980, the property devolved equally among his five heirs:
           two sons—Defendant No. 1 (Binayendra Banerjee) and late
           Soumendra Nath Banerjee—and three daughters—Defendant
           Nos. 6 to 8 (Smt. Rekha Mukherjee, Smt. Sikha Das, and Smt.
           Monila Pal).
[2024] 9 S.C.R.                                                       951

         Janardan Das & Ors. v. Durga Prasad Agarwalla & Ors.


     2.2 On 14.04.1993, an oral agreement was entered into between
         all the co-owners (Defendant Nos. 1 to 8) and the appellants
         (Defendant Nos. 9 to 11), wherein the co-owners collectively
         agreed to sell the suit property to the appellants for a total
         consideration of ₹4,20,000. This agreement was the culmination
         of mutual discussions and a longstanding understanding
         between the parties, reflecting the genuine intent of all
         co-owners to transfer the property to the appellants.
     2.3 Meanwhile, on 06.06.1993, the plaintiffs (Respondent
         Nos. 1 & 2), who are dealers operating a petrol pump on
         the suit land under a dealership agreement with Defendant
         No. 12 (Hindustan Petroleum Corporation Limited), allegedly
         entered into an agreement to sell with Defendant No. 1 and
         late Soumendra for the purchase of the suit property for a
         total consideration of ₹5,70,000 paying ₹70,000 as earnest
         money. The agreement stipulated that the sisters (Defendant
         Nos. 6 to 8) would come to Baripada within three months to
         execute the sale deed, as they were unable to do so at the
         time of the agreement. As per the terms of the agreement, the
         sale deed was to be executed before 30.09.1993.
     2.4 It is pertinent to note that the agreement dated 06.06.1993 was
         executed solely by Defendant No. 1 and late Soumendra, without
         any signatures, written consent, or explicit authorization from
         Defendant Nos. 6 to 8, who collectively held a significant 3/5th
         share in the property. The plaintiffs were aware that without the
         participation and consent of the sisters, a valid and enforceable
         sale could not be completed.
     2.5 The alleged authority of Defendant No. 1 to act on behalf of his
         sisters was based on an unregistered General Power of Attorney
         (GPA) dated 30.12.1982. However, this GPA was limited in
         scope, primarily authorizing Defendant No. 1 to manage certain
         aspects of the property, such as collecting rent. Moreover, the
         GPA was effectively revoked by a registered partition deed dated
         17.02.1988, wherein the co-owners partitioned the property
         and specifically limited Defendant No. 1’s authority to collection
         of rent, with no mention of any power to sell the property on
         behalf of the sisters.
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       2.6 In fulfilment of the prior oral agreement dated 14.04.1993, and
           after ensuring the participation and consent of all co-owners,
           Defendant No. 1, late Soumendra, and Defendant Nos. 6 to 8
           executed a registered sale deed on 27.09.1993 in favor of
           the appellants (Defendant Nos. 9 to 11) for a consideration
           of ₹4,20,000. The appellants who are bona fide purchasers,
           acted in good faith and completed the transaction with all the
           five rightful owners, and accordingly acquired valid title to the
           property.
       2.7 The plaintiffs (Respondent Nos. 1 & 2), despite being aware
           of the necessity of obtaining consent from Defendant Nos. 6
           to 8 and the limitations of Defendant No. 1’s authority, filed
           T.S. No. 103 of 1994 before the Civil Judge (Senior Division),
           Baripada. They sought specific performance of the alleged
           agreement dated 06.06.1993 or, in the alternative, specific
           performance to the extent of the shares of Defendant No. 1
           and late Soumendra. The plaintiffs, as dealers operating on the
           suit land, aimed to secure ownership of the property to further
           their commercial interests.
3.     Before the Trial Court, the plaintiffs contended that they had entered
       into a valid and enforceable agreement to purchase the suit property
       from Defendant No. 1 and late Soumendra on 06.06.1993 for a total
       consideration of ₹5,70,000, paying ₹70,000 as earnest money. They
       asserted that Defendant No. 1 was authorized to act on behalf of
       Defendant Nos. 6 to 8 by virtue of the General Power of Attorney
       dated 30.12.1982 (Ext.1), which empowered him to sell the property.
       The plaintiffs emphasized that the agreement stipulated the sisters
       (Defendant Nos. 6 to 8) would come to Baripada within three months
       to execute the sale deed, and they were assured by Defendant No. 1
       and late Soumendra that the sisters had consented to the sale. They
       maintained that they were always ready and willing to perform their
       part of the contract, including paying the balance consideration and
       completing the sale. Furthermore, they argued that the subsequent
       sale deed executed on 27.09.1993 in favour of Defendant Nos. 9 to 11
       was invalid and not binding on them, as it was executed with full
       knowledge of the prior agreement with the plaintiffs.
4.     The defendants, in their respective written statements, refuted the
       plaintiffs’ claims. They contended that Defendant No. 1 did not have
[2024] 9 S.C.R.                                                          953

         Janardan Das & Ors. v. Durga Prasad Agarwalla & Ors.


     the authority to sell the property on behalf of Defendant Nos. 6 to 8.
     They argued that the General Power of Attorney (Ext.1) was limited in
     scope and effectively revoked by the partition deed dated 17.02.1988
     (Ext.6/a), which allocated specific shares to each co-owner and only
     authorized Defendant No. 1 to collect rent, not to sell the property.
     The defendants maintained that the agreement dated 06.06.1993 was
     incomplete and unenforceable, as it was contingent upon obtaining
     the consent and participation of Defendant Nos. 6 to 8, which was
     never secured. They further asserted that the plaintiffs failed to fulfil
     the terms of the agreement, particularly in not ensuring the presence
     and consent of the sisters within the stipulated time, indicating
     lack of readiness and willingness to perform their obligations. The
     defendants highlighted that the sale deed executed on 27.09.1993
     in favour of Defendant Nos. 9 to 11 was valid, having been executed
     with the full consent and participation of all co-owners, including
     Defendant Nos. 6 to 8. They asserted that the appellants were bona
     fide purchasers for value without notice of any enforceable prior
     agreement, rendering the plaintiffs’ claims untenable.
5.   The Trial Court, after framing issues and examining the evidence,
     dismissed the suit of the plaintiffs for specific performance. The key
     findings of the Trial Court were as follows:
     5.1 The Court found that the agreement dated 06.06.1993 was
         executed only by Defendant No. 1 and late Soumendra, without
         any signatures or explicit consent from Defendant Nos. 6 to 8.
         The agreement itself acknowledged that the sisters were not
         present and their willingness needed to be secured, stating that
         they would come to Baripada within three months to execute
         the sale deed.
     5.2 The Trial Court examined the General Power of Attorney and
         concluded that it did not explicitly authorize Defendant No. 1
         to sell the property on behalf of the sisters. Moreover, the
         GPA was impliedly revoked by the subsequent partition deed
         (Ext.6/a), which allocated specific shares to each co-owner
         and only authorized Defendant No. 1 to collect rent, not to sell
         the property.
     5.3 The agreement was deemed incomplete and unenforceable
         against Defendant Nos. 6 to 8, as their consent and participation
         were essential for a valid sale. The agreement’s reliance on
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            future consent rendered it a contingent contract that did not
            materialize within the stipulated time.
       5.4 The Court observed that the plaintiffs failed to demonstrate
           continuous readiness and willingness to perform their part of
           the contract. They did not take effective steps to secure the
           consent and presence of the sisters within the three-month
           period specified in the agreement. Their inaction and reliance
           solely on Defendant No. 1 and late Soumendra indicated a
           lack of diligence and commitment to fulfilling the contractual
           obligations.
       5.5 The Court considered whether specific performance could be
           granted for the 2/5th share belonging to Defendant No. 1 and
           late Soumendra. It concluded that such partial enforcement was
           impractical and inequitable, given the nature of the property and
           its existing lease to Defendant No. 12. Splitting ownership would
           complicate the tenancy and could not be reasonably executed.
       5.6 The Court held that the sale deed dated 27.09.1993 executed
           in favour of Defendant Nos. 9 to 11 was valid and binding.
           The appellants were bona fide purchasers who had completed
           the transaction with all rightful owners, including Defendant
           Nos. 6 to 8. The plaintiffs’ prior agreement did not create any
           interest in the property that could invalidate the appellants’ title.
           Recognizing that the plaintiffs had paid ₹70,000 as earnest
           money, the Court ordered that they were entitled to a refund
           of this amount with pendente lite and future interest at 6%
           per annum from Defendant Nos. 1 to 5 (the legal heirs of late
           Soumendra included).
6.     Aggrieved by the Trial Court’s judgment, the plaintiffs filed a first
       appeal before the High Court of Orissa. On appeal, the High Court
       reversed the Trial Court’s judgment and decreed the suit in favour
       of the plaintiffs. It held that the General Power of Attorney dated
       30.12.1982 was valid and conferred authority upon Defendant No. 1
       to act on behalf of Defendant Nos. 6 to 8, rejecting the notion that
       it was impliedly revoked by the partition deed dated 17.02.1988.
       The High Court found that the alleged revocation of the GPA was
       forged and not genuine. It concluded that the agreement dated
       06.06.1993 was valid and enforceable against all defendants,
       including the sisters, and that the plaintiffs were always ready and
[2024] 9 S.C.R.                                                         955

            Janardan Das & Ors. v. Durga Prasad Agarwalla & Ors.


     willing to perform their part of the contract. Consequently, the High
     Court granted specific performance of the contract, directing all
     defendants, including Defendant Nos. 9 to 11 (appellants herein),
     to execute the sale deed in favour of the plaintiffs upon payment
     of the balance consideration.
7.   Aggrieved by the judgment and decree of the High Court, the appellants
     (Defendant Nos. 9 to 11) have preferred the present appeal before
     this Court. Having heard the learned counsel for both parties and
     perused the records, the following main issues arise for determination:
     I.      Whether the plaintiffs proved their continuous readiness and
             willingness to perform their part of the contract as mandated
             under Section 16(c) of the Specific Relief Act, 1963.
     II.     Whether the agreement to sell dated 06.06.1993 was valid
             and enforceable against Defendant Nos. 6 to 8, considering
             that Defendant No. 1 lacked the authority to act on their behalf
             without a valid and subsisting General Power of Attorney.
     III.    Whether the relief of specific performance, being discretionary,
             having been denied by the Trial Court was rightly granted by the
             High Court in the facts and circumstances of the present case.

     I.      Readiness and Willingness of the Plaintiffs to Perform the
             Contract
8.   Section 16(c) of the Specific Relief Act, 1963, mandates that a
     plaintiff seeking specific performance of a contract must aver and
     prove that they have performed or have always been ready and
     willing to perform the essential terms of the contract which are to be
     performed by them. This requirement is a condition precedent and
     must be established by the plaintiff throughout the proceedings. The
     readiness and willingness of the plaintiff are to be determined from
     their conduct prior to and subsequent to the filing of the suit, as well
     as from the terms of the agreement and surrounding circumstances.
     The rationale behind this provision is to ensure that a party seeking
     equitable relief has acted equitably themselves. Specific performance
     is a discretionary relief, and the plaintiff must come to the court with
     clean hands, demonstrating sincerity and earnestness in fulfilling
     their contractual obligations. Any laxity, indifference, or failure to
     perform their part of the contract can be a ground to deny such
     relief. The importance of readiness and willingness for enforcement
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       of specific performance has been summarized by this Court in
       U.N. Krishnamurthy v. A.M. Krishnamurthy,1 as follows:
            “23. Section 16 (c) of the Specific Relief Act, 1963 bars
            the relief of specific performance of a contract in favour
            of a person, who fails to aver and prove his readiness
            and willingness to perform his part of contract. In view of
            Explanation (i) to clause (c) of Section 16, it may not be
            essential for the plaintiff to actually tender money to the
            defendant or to deposit money in court, except when so
            directed by the Court, to prove readiness and willingness
            to perform the essential terms of a contract, which involves
            payment of money. However, Explanation (ii) says the
            plaintiff must aver performance or readiness and willingness
            to perform the contract according to its true construction.
            24. To aver and prove readiness and willingness to perform
            an obligation to pay money, in terms of a contract, the
            plaintiff would have to make specific statements in the
            plaint and adduce evidence to show availability of funds
            to make payment in terms of the contract in time. In other
            words, the plaintiff would have to plead that the plaintiff had
            sufficient funds or was in a position to raise funds in time
            to discharge his obligation under the contract. If the plaintiff
            does not have sufficient funds with him to discharge his
            obligations in terms of a contract, which requires payment
            of money, the plaintiff would have to specifically plead how
            the funds would be available to him. To cite an example,
            the plaintiff may aver and prove, by adducing evidence, an
            arrangement with a financier for disbursement of adequate
            funds for timely compliance with the terms and conditions
            of a contract involving payment of money.

                       xxx                 xxx                 xxx
            45. It is settled law that for relief of specific performance,
            the plaintiff has to prove that all along and till the final
            decision of the suit, he was ready and willing to perform
            his part of the contract. It is the bounden duty of the


1   [2022] 13 SCR 250 : (2023) 1 SCC 775
[2024] 9 S.C.R.                                                           957

         Janardan Das & Ors. v. Durga Prasad Agarwalla & Ors.


           plaintiff to prove his readiness and willingness by adducing
           evidence. This crucial facet has to be determined by
           considering all circumstances including availability of funds
           and mere statement or averment in plaint of readiness and
           willingness, would not suffice.”
9.   The Trial Court rightly concluded that the plaintiffs failed to
     demonstrate continuous readiness and willingness to perform their
     part of the contract. The agreement dated 06.06.1993 explicitly
     required the plaintiffs to ensure that Defendant Nos. 6 to 8 would
     come to Baripada within three months to execute the sale deed. The
     plaintiffs, however, did not take any concrete steps to secure the
     consent or presence of the sisters within the stipulated period. They
     relied solely on Defendant No. 1 and late Soumendra to procure
     the sisters, despite knowing that the sisters were not signatories
     to the agreement and held a significant share in the property. The
     Trial Court observed that the plaintiffs did not issue any notices or
     correspondence to Defendant Nos. 6 to 8 during the three-month
     period, nor did they make any efforts to communicate with them
     directly to expedite the execution of the sale deed. This inaction on
     the part of the plaintiffs indicated a lack of diligence and earnestness
     in fulfilling their contractual obligations. Furthermore, the plaintiffs
     continued to operate their petrol pump on the suit land without taking
     proactive steps to complete the purchase, suggesting complacency
     and a lack of urgency.
10. The High Court, in contrast, summarily concluded that the plaintiffs
    were always ready and willing to perform their part of the contract.
    It stated that there was an abundance of evidence on record to
    establish the plaintiffs’ financial capacity and willingness. However,
    the High Court did not delve into the specifics of the plaintiffs’ conduct
    or address the Trial Court’s findings regarding their inaction. The
    High Court’s assessment on this crucial aspect was cursory and
    lacked a thorough examination of the evidence and circumstances
    that demonstrated the plaintiffs’ lack of readiness and willingness.
11. Upon perusal of the records and submissions, we find merit in the
    appellants’ contention that the plaintiffs failed to prove their continuous
    readiness and willingness as required under Section 16(c) of the
    Specific Relief Act. The terms of the agreement imposed specific
    obligations on the plaintiffs, particularly in ensuring that Defendant
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       Nos. 6 to 8 would participate in the execution of the sale deed within
       three months. The plaintiffs’ failure to take any initiative in this regard
       is indicative of their lack of commitment to perform the contract. It
       is pertinent to note that the plaintiffs were aware that Defendant
       Nos. 6 to 8 were not parties to the agreement and that their consent
       was crucial for the completion of the sale. Despite this knowledge,
       the plaintiffs did not attempt to contact the sisters or address any
       correspondence to them. The plaintiffs also did not furnish any
       evidence to show that they had arranged the balance consideration
       amount or were prepared to pay it upon execution of the sale deed.
12. The reliance placed by the plaintiffs on Defendant No. 1 and late
    Soumendra to bring their sisters for execution cannot absolve them
    of their responsibility to demonstrate readiness and willingness. In
    contracts involving multiple parties with distinct interests, especially
    when some parties are absent or not signatories, the onus is on the
    plaintiff to ensure that all necessary consents and participations are
    secured. The plaintiffs’ passive approach and failure to act proactively
    undermine their claim of readiness and willingness. Moreover, the
    plaintiffs did not raise any objection or take legal action immediately
    after the expiry of the three-month period specified in the agreement.
    Their delay in asserting their rights and pursuing the completion
    of the contract further indicates a lack of earnestness. It was only
    after the sale deed was executed in favour of the appellants that
    the plaintiffs sought to enforce the agreement, which suggests an
    afterthought rather than genuine intent.
13. In light of the above reasoning, we agree with the Trial Court’s
    findings that the plaintiffs failed to prove their continuous readiness
    and willingness to perform their part of the contract as mandated
    under Section 16(c) of the Specific Relief Act. The High Court erred
    in not adequately addressing this critical aspect and in overlooking
    the plaintiffs’ inaction and lack of diligence. The plaintiffs’ failure to
    comply with the essential terms of the agreement and to take necessary
    steps within the stipulated time demonstrates a lack of readiness
    and willingness, which is fatal to their claim for specific performance.

       II.   General Power of Attorney and validity of the Sale agreement
             dated 06.06.1993.
14. In contracts involving multiple owners of property, it is imperative
    that all co-owners either personally execute the agreement to sell
[2024] 9 S.C.R.                                                          959

         Janardan Das & Ors. v. Durga Prasad Agarwalla & Ors.


     or duly authorize an agent to act on their behalf through a valid and
     subsisting power of attorney. An agent’s authority must be clear and
     unambiguous, and any limitations or revocations of such authority
     must be duly considered. Without proper authority, an agent cannot
     bind the principals to a contract of sale.
15. The Trial Court examined the General Power of Attorney dated
    30.12.1982, purportedly executed by Defendant Nos. 6 to 8 and late
    Soumendra in favour of Defendant No. 1 and held that the GPA was
    unregistered and executed over a decade prior to the agreement
    to sell. Moreover, the Trial Court also observed that GPA was not
    referenced or relied upon in the agreement dated 06.06.1993 and
    there was no mention that Defendant No. 1 was acting as an agent
    on behalf of his sisters under the GPA. It was held that the Defendant
    No. 1 signed the agreement solely in his personal capacity, and there
    was no indication that he was executing it on behalf of Defendant
    Nos. 6 to 8. The High Court disagreed with the Trial Court, holding that
    the GPA was valid and in force at the time of the agreement. It opined
    that the lack of explicit reference to the GPA in the agreement did not
    invalidate Defendant No. 1’s authority to act on behalf of his sisters.
16. In our considered opinion, the High Court erred in its assessment
    of the authority of Defendant No. 1 to bind Defendant Nos. 6 to 8.
    While it is legally permissible for an agent to bind a principal even if
    the agency relationship is not disclosed, this principle applies when
    the agent has valid and subsisting authority. In the present case, the
    GPA was executed in 1982 and was unregistered. The subsequent
    registered partition deed in 1988 allocated specific shares to each
    co-owner and delineated their rights and authorities. Moreover, The
    partition deed dated 17.02.1988 impliedly revoked any prior authority
    granted under the GPA concerning the sale of the property. By
    specifying that Defendant No. 1 was authorized only to collect rent,
    it limited his authority and implicitly withdrew any broader powers
    previously granted. It must be emphasized that the agreement dated
    06.06.1993 did not mention the GPA or indicate that Defendant
    No. 1 was acting on behalf of his sisters. He signed the agreement
    solely in his capacity, and there was no representation made to the
    plaintiffs that he had the authority to bind the sisters. This omission is
    significant, as the plaintiffs were aware that the sisters’ consent was
    essential, which is evident from the agreement’s stipulation that the
    sisters would come to execute the sale deed within three months.
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17. The plaintiffs were cognizant of the fact that Defendant Nos. 6 to 8
    were not parties to the agreement and that their willingness
    and participation were necessary for a valid sale. This is further
    corroborated by the plaintiffs’ own admissions that they were assured
    by Defendant No. 1 and late Soumendra that the sisters would be
    brought to execute the sale deed. Thus, the plaintiffs cannot claim that
    they believed Defendant No. 1 had the authority to bind the sisters
    without their explicit consent. The appellants have rightly pointed
    out that an agent’s authority must be explicit, and any limitations or
    revocations thereof must be given due consideration. In the absence
    of a valid and subsisting power of attorney authorizing Defendant
    No. 1 to sell the property on behalf of Defendant Nos. 6 to 8, the
    agreement cannot be enforced against them.
18. In view of the above, we hold that Defendant No. 1 lacked the
    authority to bind Defendant Nos. 6 to 8 in the agreement to sell dated
    06.06.1993. The General Power of Attorney did not confer upon him
    the power to sell the property on behalf of his sisters at the time of
    the agreement, having been impliedly revoked by the partition deed.
    The agreement was, therefore, incomplete and unenforceable against
    Defendant Nos. 6 to 8, who collectively held a majority share in the
    property. The plaintiffs’ knowledge of the necessity of obtaining the
    sisters’ consent, coupled with their failure to secure such consent,
    renders the agreement ineffective against Defendant Nos. 6 to 8.
    Consequently, the agreement cannot be specifically enforced against
    them, and the plaintiffs cannot claim any right over their shares in
    the property based on the said agreement.

       III.   Discretionary Nature of Granting Specific Performance
19. The relief of specific performance under the Specific Relief Act, 1963,
    is discretionary in nature. Section 20 of the Act (applicable to this
    case as it predates the 2018 amendment) explicitly stated that the
    court is not bound to grant such relief merely because it is lawful to
    do so. The discretion must be exercised judiciously and based on
    sound principles, ensuring that granting specific performance is just
    and equitable in the circumstances of the case.
20. In the present case, several factors weigh against granting specific
    performance. The agreement to sell was incomplete and unenforceable
    against Defendant Nos. 6 to 8, who held a majority share in the
    property; enforcing such an agreement would be inequitable. The
[2024] 9 S.C.R.                                                       961

         Janardan Das & Ors. v. Durga Prasad Agarwalla & Ors.


     plaintiffs failed to demonstrate readiness and willingness to perform
     their obligations and did not take necessary steps to secure the
     consent of all co-owners. Granting specific performance would
     unfairly prejudice the defendants, especially Defendant Nos. 6 to 8,
     who never consented to the sale to the plaintiffs. Furthermore, the
     plaintiffs can be adequately compensated by a refund of the earnest
     money with interest; there is no evidence to suggest that monetary
     compensation would not suffice.
21. Section 20 of the Specific Relief Act, 1963 prior to amendment by
    Act No. 18 of 2018 which was brought into effect w.e.f. 1.10.2018
    categorically provided that the relief of specific performance is
    discretionary in nature and the court is not bound to grant such relief
    merely because it is lawful to do so. But the discretion of the court
    has to be on sound and reasonable principles.
22. In the present case, the plaintiffs have sought specific performance
    of the agreement dated 06.06.1993 whereunder the sale deed
    was to be executed before 30.09.1993 after obtaining the consent
    of the sisters (Defendant Nos. 6 to 8) as they had not joined the
    agreement. However, all the co-owners of the property transferred
    the suit property in favour of the appellants vide sale deed dated
    27.09.1993 for a consideration of Rs. 4,20,000/-. The appellants
    are the bona fide purchasers in good faith of the suit property for
    valuable consideration. Therefore, once they have acquired the rights
    in the property way back on 27.09.1993, there was no justification
    to disturb the said sale deed by decreeing the suit for specific
    performance of the agreement dated 06.06.1993 which was not even
    signed by all the co-owners specially the three sisters (Defendant
    Nos. 9 to 11). The aforesaid sale deed was not even challenged
    though it had come into existence at the time of filing of the suit for
    specific performance, therefore, when the Trial Court had exercised
    its discretion not to decree the suit for specific performance, it was
    not open for the appellate court to decree it affecting the rights of
    the bona fide purchasers i.e. the appellants.
23. In conclusion, considering the discretionary nature of the relief and
    the principles governing its exercise, we find that granting specific
    performance in this case would be neither just nor equitable. The
    plaintiffs’ failure to fulfil essential contractual terms, coupled with
    the lack of authority to bind all co-owners, renders the grant of
    specific performance inappropriate. The equitable remedy sought
962                                                        [2024] 9 S.C.R.

                           Digital Supreme Court Reports


       by the plaintiffs cannot be granted in light of their conduct and the
       circumstances of the case.
24. In view of the foregoing analysis, we conclude that the plaintiffs
    failed to demonstrate their continuous readiness and willingness
    to perform their contractual obligations, and that Defendant No. 1
    lacked the authority to bind Defendant Nos. 6 to 8 in the agreement
    dated 06.06.1993. Given the incomplete and unenforceable nature
    of the agreement, we find it neither just nor equitable to grant the
    relief sought by the plaintiffs.
25. Accordingly, the appeal is allowed. The judgment and decree dated
    25.10.2013 passed by the High Court of Orissa are set aside. The
    judgment dated 17.05.1997 passed by the Trial Court dismissing the
    suit for specific performance is restored. Furthermore, the appellants
    are directed to refund to the plaintiffs (Respondent Nos. 1 & 2) a sum
    of ₹10,00,000 (Rupees Ten Lakhs) within a period of two months from
    the date of this order. This amount includes the earnest money paid
    by the plaintiffs and accounts for any interest and expenses incurred.
26. There shall be no order as to costs.

       Result of the Case: Appeal allowed.



       †
           Headnotes prepared by: Nidhi Jain