Safiya Malik

The High Court at Calcutta has dismissed an appeal seeking specific performance of a sale agreement on the grounds that the defendant lacked the requisite title to transfer ownership. The judgment, delivered by Justice Sabyasachi Bhattacharyya and Justice Uday Kumar, concurred with the lower court’s ruling that the absence of ownership in the defendant precludes the grant of specific performance relief.

The case arose from a suit seeking specific performance of an agreement for sale relating to a property situated in Shalimar Apartments, Kolkata. The original owner had executed a 75-year lease in 1964, which subsequently changed hands multiple times. The defendant had entered into an agreement for sale with the appellant in 1977, yet the formal conveyance deed was never executed. The appellant approached the court in 2007, claiming the defendant had refused to honour the agreement.

The appellant contended that the trial court wrongly dismissed the suit by not considering Section 12 of the Specific Relief Act, 1963, which permits specific performance to the extent possible, even if complete performance is not feasible. The appellant also argued that the 2018 amendment to Section 20 of the Specific Relief Act removed the discretionary power of courts, making the grant of specific performance mandatory when the necessary conditions were met. Several precedents, including Chennadi Jalapathi Reddy v. Baddam Pratapa Reddy and B. Santoshamma v. D. Sarala, were cited in support of these claims.

Further, the appellant invoked Section 53-A of the Transfer of Property Act, asserting that possession had been taken in part performance of the contract and thus merited legal protection. The appellant argued that given the possession and the obligations under the agreement, the court should have decreed specific performance or, at the very least, ordered an alternative relief such as damages.

The defendant, on the other hand, contended that he had no transferable ownership in the property, as the leasehold rights were still subject to the 1964 lease. The defendant further argued that the agreement for sale did not constitute an enforceable right since no title had ever vested in him that could be conveyed to the appellant.

The court closely examined the leasehold nature of the property and the conditions surrounding the agreement for sale. It recorded that the original lease executed in 1964 remained in force, and the subsequent transactions leading to the defendant’s possession did not confer ownership that would permit the transfer of absolute title.

On the question of limitation, the court considered Clause 7 of the agreement, which provided that a formal deed would be executed whenever demanded by the purchaser. Since the appellant made such a demand in 2007, the court ruled that the suit was within the prescribed limitation period. The court observed:

“Since it is an undisputed position that the said right was asserted first in the year 2007 by the plaintiff, the cause of action for the suit arose with the refusal by the defendant to do so in 2007, in which year the suit was filed. Thus, the suit cannot be said to be barred by limitation.”

Regarding specific performance, the court noted that under the law applicable at the time of the trial court’s ruling in 2017, discretion remained with the judiciary on whether to grant such relief. The amendment to Section 20 of the Specific Relief Act in 2018, which made specific performance mandatory under certain conditions, was found to have no retrospective application to the case.

The court further recorded: “As per Section 20, discretion is vested in the court whether or not to grant a decree for specific performance and the court is not bound to grant such relief merely because it is lawful to do so.”

Addressing the appellant’s reliance on Section 53-A of the Transfer of Property Act, the court held that while the provision protects possession taken in part performance of a written contract, it does not automatically entitle the transferee to specific performance.

 “Section 53-A protects the possession of a party who, in part performance of a written agreement, has taken such possession. However, such provision is not germane in the present context.”

The judgment distinguished this case from B. Santoshamma v. D. Sarala, wherein the Supreme Court had directed specific performance of an agreement in a scenario where part of the property had already been transferred. The present case, however, involved a complete lack of title in the defendant, making specific performance legally impermissible. The court stated:

“In the absence of any saleable title in the property having vested in the vendor at any point of time, no decree of specific performance can be passed by directing the defendant to execute a sale deed.”

The court also rejected the argument that it could direct the execution of a lease deed for the remaining lease period, observing:

“It would be beyond the jurisdiction of the court to create a new agreement and direct execution of a deed of lease by the defendant in favor of the plaintiff for the residual period of the original 75 years’ lease.”

The High Court upheld the lower court’s decision, stating that:

“The appeal is dismissed on contest, thereby affirming the judgment and decree dated October 26, 2017, passed by the learned Judge, Sixth Bench, City Civil Court at Calcutta in Title Suit No. 3500 of 2007 whereby the plaintiff/appellant’s suit for specific performance was dismissed.”

The court further noted that since no claim for damages had been raised in the suit, no such relief could be granted at this stage.

Case Title: Pramod Shroff v. Mohan Singh Chopra
Case Number: F.A.T. No. 47 of 2018
Bench: Justice Sabyasachi Bhattacharyya and Justice Uday Kumar

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