M.K. MADHAVAN (DELETED) NANLINI W/O MADHAVAN AND OTHRS v. R. SUBRAMANIAM (DELETED) RAJESH R. SUBRAMANIAM AND OTHRS
Specific Performance of Oral Agreement - Proof of Continuous Readiness and Willingness and Balancing Equities Through Enhanced Consideration due to Property Price Appreciation.
Court: Bombay High Court
Citation: 2026:BHC-AS:15364
Decision Date: 01-04-2026
List of Laws
Specific Relief Act, 1963; Indian Contract Act, 1872; Code of Civil Procedure, 1908; Equity and Discretionary Relief
- Facts: The original Plaintiff and Defendant entered into an oral agreement in May 1978 for the sale of Flat No. 13 in Wadala, Mumbai, for a total consideration of Rs. 50,000. The Plaintiff paid a sum of Rs. 30,000 in two installments, for which receipts were issued. The Plaintiff alleged that despite repeated requests for possession against the balance payment of Rs. 20,000, the Defendant delayed and eventually inducted his brother into the flat. In September 1981, the Defendant attempted to repudiate the contract by returning the Rs. 30,000 via cheques, citing personal need due to upcoming retirement. The Plaintiff refused the refund and filed a suit for specific performance. The Defendant contended that the Plaintiff lacked the funds to pay the balance in 1978 and had subsequently agreed to the cancellation of the deal.
- Procedural Posture: The Bombay City Civil Court partly decreed the suit in December 2007, rejecting specific performance but directing a refund of the earnest money with 12% interest. The heirs of the original Plaintiff (Appellants) challenged this judgment before the Bombay High Court.
- Issue: Whether the Plaintiff proved continuous readiness and willingness to perform the contract under Section 16(c) of the Specific Relief Act, 1963, and whether the court should exercise its discretion to grant specific performance despite the long passage of time and rise in property prices.
- Holding: Yes, the High Court held that the Plaintiff proved readiness and willingness. It set aside the trial court's order and granted a decree for specific performance, subject to the Appellants paying an additional sum of Rs. 25 lakhs to balance the equities.
- Reasoning: The Court reasoned that contemporaneous documentary evidence, specifically the Plaintiff's letter dated 1st September 1981, supported his claim of being ready to complete the transaction. The Defendant's claim of an earlier oral cancellation was deemed an afterthought as it was not mentioned in his reply letter of September 1981. Citing "P. Daivasigamani v. S. Sambandan", the Court held that "readiness" refers to financial capacity and "willingness" to the intention to perform, neither of which requires a straitjacket formula or the actual deposit of money in court unless directed. Furthermore, while the trial court refused specific performance based on the passage of time and the Defendant's widow's residence, the High Court found these grounds insufficient to deprive the Plaintiff of a valid contract. To address the steep rise in property prices since 1978, the Court exercised its equitable jurisdiction to increase the balance consideration from Rs. 20,000 to Rs. 25.20 lakhs.
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