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1996 DIGILAW 911 (ALL)

RAM DHAN v. KALU RAM

1996-08-14

S.K.PHAUJDAR

body1996
S. K. PHAUDJAR, J. A suit (O. S. No. 104 of 1981) was filed by the present respon dent before the Civil Judge, Muzaffarnagar for specific performance of contract by the present appellant. The suit was decreed on 31-5-1984, not for the specific performance but for realisation of Rs. 15,000 that was paid in part- performance of the contract. 2. An appeal (CA 150 of 1994) was preferred by the aggrieved plaintiff and the claim for specific performance of the con tract was decreed by the judgment dated 7-8-1995. 3. It was urged that the trial court had rightly exercised the discretion under Sec tion 20 (2) (b) of the Specific Relief Act and there was no reason for the first appellate court to go against the exercise of that dis cretion. It was urged that whether hardship was pleaded or not, the court had a right to come to a conclusion of hardship and to refuse specific performance under Section 20 (2) (b) of the Specific Relief Act. It was urged that there had been an admission on the part of the plaintiff that the defendant would have been in possession of only one kutchha bigha of land after the proposed sale and this admission was sufficient to infer hardship. Two questions came up for consideration: (1) Whether a court can arrive at a decision on hardship even in the absence of a pleading to that effect; and (2) Whether in the absence of such a pleading an admission touching the point of hardship could be looked into. 4. Section 20 deals with discretion for decreeing specific performance. For easy reference it is desirable to quote the whole of Section 20. "20. Discretion as to decreeing specific per formance.- (1) The jurisdiction to decree specific performance is discretionary, and the Court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal. Discretion as to decreeing specific per formance.- (1) The jurisdiction to decree specific performance is discretionary, and the Court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal. (2) The following are cases in which the court may properly exercise discretion not to decree specific performance - (a) Where the terms of the contract or the conduct of the parties at the time of entering into the contract or the other circumstances under which the contract was entered into are such that the contract, though not voidable, gives the plain tiff an unfair advantage over the defendant; or (b) Where the performance of the contract would involve some hardship on the defendant which he did not foresee, whereas it is non-perfor mance would involve no such hardship on the plaintiff; (c) Where the defendant entered into the contract under circumstances which though not rendering the contract voidable makes inequitable to enforce specific performance. Explanation 1.- Mere inadequacy of con sideration, or the mere fact that the contract is onerous to the defendant or improvident in its nature, shall not be deemed to constitute an unfair advantage within the meaning of clause (a) or hardship within the meaning of clause (b ). Explanation 2.- The question whether the performance of a contract would involve hardship on th defendant within the meaning, of clause (b) shall, except in cases where the hardship has resulted from any act of the plaintiff, subsequent to the contract, be determined with reference to the circumstances existing at the time of the con tract. (3) The court may properly exercise discre tion to decree specific performance in any case where the plaintiff has done substantial acts or suffered losses in consequence of a contract capable of specific performance. (4) The court shall not refuse to any party specific performance of a contract merely on the ground that the contract is not enforceable at the instance of the other party. " 5. It appears that the jurisdiction to decree a specific performance is discretionary and the Court is not bound to grant such relief. A caution is, however, given in the section itself ^that the discretion is to be exercised on sound and reasonable judicial principles. " 5. It appears that the jurisdiction to decree a specific performance is discretionary and the Court is not bound to grant such relief. A caution is, however, given in the section itself ^that the discretion is to be exercised on sound and reasonable judicial principles. It is further indicated in the sec tion itself that exercise of this jurisdiction is capable of correction by a court of appeal. It must be held, therefore, that the court of first appeal had every jurisdiction to inter fere with the discretion exercised by the trial court on good grounds. 6. Sub-section (2) of Section 20 categorises the cases in which the court may not decree specific performance and sub-clause (b) covers the cases of hardship. Ex planation 2, as quoted above, indicates that the question whether performance of a con tract would involve hardship as defined within the meaning of clause (b) shall be determined with reference to the cir cumstances existing at the time of the con tract. In the case at our hand, it is only argued that the appellant would be left with just one kutcha bigha of land if the proposed sale is made, and this would led to hardship whereas the plaintiff would not suffer any hardship if the sale is not made. There is no dispute, however, that in the written state ment no plea was raised regarding hardship. 7. The appellant relied on a decision of the Supreme Court reported in AIR 1987 SC 2328 . It was directed in this case that Section 20 of the Specific Relief Act preserved judicial discretion to courts as to decreeing specific performance. The court should meticulously consider all the facts and circumstances of the case. The motive behind litigation should also enter into the judicial verdict. The court should take care to see that it is not used as an instrument of oppression to give unfair advantage to the plaintiff. On facts it was held in this case that the proposed purchaser c had waived his rights under the agreement to sell and, ac cordingly, it was held that his assignee could not have enforced the agreement. In this case law although the principle underlying the text of Section 20 was explained, there is nothing to indicate if specific performance was refused on the ground of hardship. In this case law although the principle underlying the text of Section 20 was explained, there is nothing to indicate if specific performance was refused on the ground of hardship. Rather, it was a case where the plaintiff was trying to take an unfair advantage and in that light it was a observed that the Court should not be used as an instrument of op pression. The fact do not indicate if absence of plea of hardship was a point agitated before the Supreme Court. 8. Another case was relied upon by the plaintiff as reported in AIR 1982 Karnataka at page 264. It was also a suit for specific performance of contract of sale. The defen dant herein was a woman and it was found that enforcement of the contract would cause hardship to this woman while not en forcement would not cause any hardship to the plaintiff. Under these findings it was stated that the courts were not to enforce specific performance of contract the result of which would be to impose hardship on either of the parties to it. A detailed reading of the judgment (pargraph 3) indicates that the defendant had contested the suit and filed a writter statement and stated that she did not know the content of the contract paper. She was made to understand that it was a mortgage deed -. She did not know reading or writing Kannada in which lan guage the agreement was written. At the time of execution of the agreement, her hus band was sick and he too did not know Kannada. It wa further pleaded that the suit- property was the sole means of her livelihood providing both residence and in come byway of rent and the agreement was inequitable and its performance would lead to hardship. 9. In the case at our hand, as indicated above, the defendant had not taken any plea of hardship in the written statement, when a court has to give a judgment basing on a legal principle, the court is required to see if the conditions for application of the legal principles are present. For application of Section 20 (2) (b) of the Specific Relief Act, specific performance of an agreement could be refused on proof that it would lead to hardship on the defendant which he did not foresee. For application of Section 20 (2) (b) of the Specific Relief Act, specific performance of an agreement could be refused on proof that it would lead to hardship on the defendant which he did not foresee. This hardship would be inferred from proof of certain facts and no fact could be proved in a civil proceeding unless the same is pleaded. In fact, the question of hardship was not an issue before the court itself and the court could not have come to a finding on that point to give a relief to the defendant on that ground. 10. It was urged that the plaintiff had admitted that the defendant would be left with only one kutchha bigha of land after the sale. It was stated that this admission would always bind the plaintiff. An admission has been defined in the Indian Evidence Act as a statement suggesting any inference as to any fact in issue or a relevant fact. A fact in issue is one which by itself or in connection with other facts proves the exist ence or non- existence of any right, liability or disability asserted or denied in any suit. Under the Evidence Act one fact is said to be relevant to another when one is con nected with the other in any of the ways referred to in the provisions of the Indian Evidence Act relating to relevancy of facts. Section 5 of the Evidence Act says that evidence may be given in any suit of the existence or non- existence of fact in issue or such other facts as hereinafter declared relevant. For the admission to be relevant, the fact admitted must therefore, be a fact in issue or a fact relevant to it. When there was no case made out in the pleading for hardship a mere admission on behalf of the plaintiff may not be read as evidence. 11. The two points raised by the appel lants having failed, the appeal must be and is dismissed. Appeal dismissed. .