PRAKASH CHANDRAversusNARAYAN

                        [2012] 5 S.C.R. 444


A                      PRAKASH CHANDRA
                                  v.
                             NARAYAN
                  (Civil Appeal No. 8102 of 2012)
                          APRIL 23, 2012
B
             [G.S. SINGHVI AND SUDHANSU JYOTI
                       MUKHOPADHAYA]

        Specific Relief Act, 1963 - s. 20(2}{b) - Suit for specific
C performance - Defence of hardship under - Held: In a case
  of specific performance, hardship is a good defence provided
  such defence is taken by the defendant and evidence in
  support of such defence is brought on record - On facts, trial
  court finding all issues with regard to appellant's entitlement
D to relief for specific performance of agreement for sale of land
  in favour of the appellant, decreed the suit - First appellate
  court, though answered all the issues in favour of the
  appellant but set aside the decree as it factually found that
  the respondent would be landless as against the appellant
E who is having various businesses as well - Order upheld by
  the High Court in second appeal - Trial court and the first
   appellate court did not frame issue relating to the hardship
  of the respondent - No such defence was taken nor any
   evidence was brought on record in its support by the
F respondent - Question as to whether the grant of relief for
   specific performance would cause hardship to the defendant
   within the meaning of Clause (b) of subsection (2) of Section
   20, is a question of fact - First appellate court without framing
   such an issue erred in reversing the finding of the trial court
G while concurring with it on all other issues with regard to the
   appellant's entitlement to relief for specific performance of
   contract - High Court also erred in dismissing the second
   appeal - Thus, the appellant is entitled to the specific


H                                 444
          PRAKASH CHANDRA v. NARAYAN                       445


performance of agreement for sale - Order passed by the High      A
Court and the first appellate court set aside.

    Appellant filed a suit for specific performance of
agreement for sale of agricultural land against respondent
and alternatively to refund the earnest money. The trial
                                                           B
court decreed the suit for specific performance. The
respondent filed an appeal. The first appellate court
though answered all the issues in favour of the appellant
but set aside the decree allowing discretion in favour of
the respondent by directing him to pay earnest money,
since it factually found that the respondent would be C
landless as against the appellant who is having various
business as well. The appellant then filed second appeal.
The Single Judge of the High Court dismissed the same.
Therefore, the appellant filed the instant appeal.
                                                           D
    Allowing the appeal, the Court

     HELD: 1.1 From the materials on record and the
agreement dated 18th April, 1996 and from the judgment
of the trial court and the first appellate court, it is evident
that no issue relating to the hardship of the respondent          E
was framed. In a case of specific performance, hardship
is a good defence provided such defence is taken by the
defendant and evidence in support of such defence is
brought on record, while in this case no such defence
was taken by the respondent and no evidence was                   F
brought on record in its support. [Para 13] [451-C-E]

    1.2 The appellant specifically pleaded that the
respondent possessed agricultural land which was not
denied by the respondent. The appellant proved that an            G
agreement was reached between the parties on 18th April,
1996 to sell southern portion of land by making an east-
west boundary for the consideration of Rs. 51,000/- for
which appellant had paid Rs.39,000/- to the respondent
                                                                  H
     446      SUPREME COURT REPORTS              [2012] 5 S.C.R.


A as earnest money. The appellant also proved that he was
  always ready and willing to perform his part of the
  contract. These issues were decided in favour of the
  appellant. During cross examination the respondent
  stated that he sold only part of land during the pendency
8 of the case, thereby remaining 2.25 cultivable and 0.88
  uncultivable land is still available with the respondent.
  [Para 14] [451-E-H]

       1.3 The question as to whether the grant of relief for
  specific performance would cause hardship to the
C defendant within the meaning of Clause (b) of subsection
  (2) of Section 20 of the Specific Relief Act, 1963, being a
  question of fact, the first appellate court without framing
  such an issue ought not to have reversed the finding of
  the trial court while concurring with it on all other issues
D with regard to the appellant's entitlement to relief for
  specific performance of contract. The High Court in the
  second appeal failed to notice that the respondent had
  not taken any defence of hardship and no such issue was
  framed and in absence of any such evidence on record,
E the first appellate court held that he would be landless
  should the decree for specific performance be granted.
  [Para 15] [452-A-C]

      1.4 The appellant is entitled to the specific
  performance of agreement for sale, as ordered and
F decreed by the trial court and the same is affirmed. The
  order passed by the High Court in the second appeal and
  the judgment and decree passed by the first appellate
  court are set aside. The appellant is allowed two months
  to pay the balance consideration to the respondents.
G [Para 16) [452-D-F]

         CIVIL APPELLATE JURISDICTION : Civil Appeal No.
     8102 of 2012.

H'         From the Judgment & Order dated 06.03.2007 of the High
           PRAKASH CHANDRA v. NARAYAN                        447


Court of Judicature at Mumbai, Nagpur Bench, Nagpur in              A
Second Appeal No. 198 of 2006.

     Dr. Monika Gusain, Hariom Yaduvanshi for the Appellant.

     Anagha S. Desai for the Respondent.
                                                                    B
     The Judgment of the Court was delivered by

    SUDHANSU JYOTI MUKHOPADHAYA, J. 1. Leave was
granted on 22.9.2011.

     2. This appeal has been preferred by the appellant-plaintiff   C
against the judgment and order dated 6th March, 2007 passed
by the learned Single Judge of the High Court of Judicature of
Mumbai, Nagpur Bench in Second Appeal No.198 of 2006,
whereby the judgment and decree passed by the District Court,
Pandharkawada (Kelapur) in Regular Civil Appeal No.129 of           D
2002 came to be confirmed.

     3. The first appellate court by the aforesaid judgment and
decree reversed the judgment and decree dated 23rd
September, 1998 and 3rd October, 1998 in Special Civil Suit         E
No.175 of 1997 which was preferred by the appellant-plaintiff
for specific performance.

      4. The suit in question was filed by the appellant against
 the respondent for specific performance of agreement for sale
dated 18th April, 1996 in respect of agricultural land              F
admeasuring 1 H. 61Are. at a price of Rs.51,000/-. It was the
case of the appellant that he had paid the earnest money of
Rs.39,000/- while the balance amount was to be paid on the
date of execution of the sale deed which was fixed for 18th
March, 2007, ·but despite the appellant being present for the       G
purpose of completion of the formalities of agreement for sale,
the respondent did not turn up. Consequently, the appellant
purchased a stamp paper of Rs.100/- on 18th March, 1997 and
issued a notice to the respondent on 2nd April, 1997 and called
upon him to execute the sale deed dated 21st April, 1997 but        H
    448     SUPREME COURT REPORTS                   [2012) 5 S.C.R.


A   a false reply was given by the respondent on 15th April, 1997.
    As the respondent refused to perform his part of the contract,
    the appellant filed Special Civil Suit No.175 of 1997 for specific
    performance of contract, and alternatively to refund the earnest
    money.
B
       5. The respondent contested the case claiming that his
  signatures were obtained on a blank stamp paper for the
  outstanding money of Rs.12,000/- for the purchase of fertilizers
  and clothes etc. The trial court by its judgment dated 23rd
C September, 1998 and decree dated 3rd October, 1998
  decreed the suit for specific performance.

         6. On appreciation of the material on record, the trial court
    held that the appellant had proved that the respondent agreed
    to sell the suit land for consideration of Rs.51,000/- by executing
D   an agreement for sale on 18th April, 1996 and that he had paid
    earnest money of Rs.39,000/- to the respondent. The
    respondent failed to prove that he had signed on a blank Stamp
    paper in the presence of Vithal Sitaram Thaori. On the other
    hand there is sufficient material on record to show that the
E   appellant was ready and willing to perform his part of the
    contract and, therefore, the appellant is entitled to the decree
    for specific performance of contract while the alternative prayer
    needs no consideration. The respondent is not entitled to
    compensatory cost. All the six issues were decided in favour
F   of the appellant and against the respondent with a direction to
    the respondent to execute the sale deed on or before 31st
    August, 1998 in respect of the suit land i.e. southern portion of
    the land admeasuring 1 H 61 Are having Gat No.1 /2 situated
    at village Khadki on payment of the balance consideration of
    Rs.12,000/-. The Court also directed the respondent to deliver
G   the possession of the suit land to the appellant with the clear
    condition that in the event of the respondent failing to execute
    the sale deed on or before the fixed date, the appellant will
    deposit the balance amount in the Court to get the sale deed
    executed.
H
          PRAKASH CHANDRA v. NARAYAN                          449
       [SUDHANSU JYOTI MUKHOPADHAYA, J.]

     7. The respondent took up the matter vide first appeal          A
before the District Court. The following questions were framed
for determination:

      (1)   Whether the defendant has agreed to sell and the
            plaintiff has agreed to purchase the suit property for   8
            consideration of Rs.51,000/- on 18.4.1996?

      (2)   Whether the defendant has signed Ex.25 blank
            Stamp paper in lieu of the credit amount of the
            plaintiff towards the clothes and fertilizers?
                                                                     c
      (3)   Whether the plaintiff was and is ready and willing
            to perform his part of the contract?

      (4)   Whether the defendant has failed to perform his
            part of the contract?
                                                                     D
      (5)   Whether it is necessary to interfere with the
            impugned judgment and decree?

      (6)   What order and relief?"
                                                                     E
     8. The first appellate court on hearing the parties and on
appreciation of the material on record answered all the issues
in favour of the appellant but reversed the judgment and decree
thereby allowing discretion in favour of the respondent by
directing him to pay the earnest money with interest.
                                                                     F
    Referring Clause (b) of sub-section (2) of Section 20 of
Specific Relief Act, the First Appellate Court held as follows:

    "20. Having regard to the facts on the record, it is evident
    from the evidence of the defendant and also an admitted          G
    fact that the defendant was having the only suit land and
    he would be landless if the decree would be granted for
    specific performance. On the other hand, the plaintiff is
    having landed properties and all the riches including the
    business of clothes and fertilizers. Therefore these aspects     H
    450       SUPREME COURT REPORTS                   [2012] 5 S.C.R.


A         are not considered by the learned lower court, while
          exercising the discretion, in granting the decree for specific
          performance. The amount of Rs.12,000/- were not paid or
          deposited to the defendant's favour since the agreement
          for sale till the date of decree. Therefore having regard to
B         all these circumstances and facts on the record, this Court
          is of the opinion that this Court should interfere in the
          discretion exercised by the learned lower court while
          granting the decree for specific performance. The hardship
          would be, in all probabilities and facts and circumstances
c          caused to the defendant than the plaintiff. In the result, the
           court is of the opinion that alternative relief for refund of
           the earnest amount of Rs.39,000/- to the plaintiff by the
           defendant, would meet the ends of justice. The same can
           be utilized and exercised by awarding the damages by
           way of an interest on the earnest amount. ....... "
D
        9. When the matter was taken up in the second appeal,
  the learned Single Judge vide impugned judgment dated 6th
  March, 2007 dismissed the second appeal on the ground that
  the first appellate court has factually found that the respondent
E would be landless as against the appellant who is having
  various businesses as well.

        10. According to the learned counsel for the appellant, there
  was no impediment in according a relief of specific
F performance particularly when all the issues have been decided
  in favour of the appellant and against the respondent. He further
  submitted that, in the absence of any defence taken by the
  respondent that he would become landless if the relief for
  specific performance is granted and in absence of any material
G on record, the finding of the first appellate court cannot be
  sustained.

        11. Learned counsel for the appellant referring to the
  cross- examination of the respondent contended that the
  respondent would not become landless as is evident from the
H fact that after the agreement reached with the appellant, he sold
           PRAKASH CHANDRA v. NARAYAN                           451
        [SUDHANSU JYOTI MUKHOPADHAYA, J.]
 4 acres of land to one Dilip Karekar. Even thereafter the             A
 respondent is having 2.25 H of cultivable land apart from 0.88
 H uncultivable land.

      12. According to the learned counsel for the respondent,
as hardship would be caused to the respondent, the appellate           8
court rightly held that it would sub-serve the ends of justice if
the entire amount of earnest money received by the respondent
is directed to be paid back to appellant along with interest.

     13. We have heard the learned counsel for the parties. The
learned counsel appearing on either side elaborately took us           C
through the findings of the trial court, the first appellate court
as well as the High Court in second appeal. From the materials
on record and the agreement dated 18th April, 1996 and from
the judgment of the trial court and the first appellate court, it is
evident that no issue relating to the hardship of the respondent       D
was framed. In a case of Specific performance, hardship is a
good defence provided such defence is taken by the defendant
and evidence in support of such defence is brought on record,
while in this case no such defence was taken by the respondent
and no evidence was brought on record in its support.                  E

     14. The appellant has specifically pleaded that the
 respondent possessed agricultural land admeasuring 5 H. 76.R.
 in Gat No. !-'2, which has not been denied by the respondent.
The appellant proved that an agreement was reached between
the parties on 18th April, 1996 to sell southern portion of land
                                                                       F
admeasuring 1.61 H. by making an east-west boundary for the
consideration of Rs. 51,000/- for which appellant had paid
Rs.39,000/- to the respondent as earnest money. The appellant
also proved that he was always ready and willing to perform
his part of the contract. These issues were decided in favour          G
of the appellant. During cross-examination the respondent
stated that he sold only 4 acres of land during the pendency of
the case, thereby remaining 2.25 H cultivable and 0.88 H
uncultivable land is still available with the respondent.
                                                                       H
    452    SUPREME COURT REPORTS                  [2012] 5 S.C.R.

A       15. The question as to whether the grant of relief for
  specific performance will cause hardship to the defendant
  within the meaning of Clause (b) of sub-section (2) of Section
  20 of the Specific Relief Act, 1963, being a question of fact,
  the first appellate court without framing such an issue ought not
B to have reversed the finding of the trial court while concurring
  with it on all other issues with regard to the appellant's
  entitlement to relief for specific performance of contract.

       The High Court in the second appeal failed to notice that
  the respondent had not taken any defence of hardship and no
C such issue was framed and in absence of any such evidence
  on record, the first appellate court held that he would be
  landless should the decree for specific performance be granted.

        16. For the reasons stated above, we are of the view that
D the appellant is entitled to the specific performance of
  agreement for sale, as ordered and decreed by the trial court.
  The appeal is accordingly allowed. The order passed by the
  High Court in the second appeal and the judgment and decree
  passed by the first appellate court are set aside. The judgment
E and decree passed by the Trial Court is affirmed. The appellant
  is allowed two months to pay the balance consideration to the
  respondents. If the respondent fails to execute the sale deed,
  such amount will be deposited in the trial court which will ensure
  the execution of the sale deed as per its judgment and decree.
F N.J.                                            Appeal allowed.