Holding

A review court cannot sit in appeal over its own order; review is permissible only on error apparent on the record, discovery of new and important facts, mistake, or any other sufficient reason, none of which were present in this case.

Summary

The parties entered into a sale agreement for a haveli; the buyer sued for specific performance and obtained a decree, which the seller appealed and had set aside. During the appeal the seller withdrew the amount deposited by the buyer, and the High Court again set aside the trial court decree. Both parties filed review petitions under Order 47 Rule 1, and the High Court judge recalled his own order and ordered a rehearing. The Supreme Court held that a review is not an appeal and may be entertained only on an error apparent on the face of the record, discovery of new and important facts, a mistake, or any other sufficient reason. No such ground existed; the High Court had improperly re‑appreciated evidence and acted as an appellate court. Consequently, the review order was set aside and the appeal was allowed.

Issues considered

The maintainability of the review petitions filed under Order 47 Rule 1 CPC
Whether a review court can re‑appreciate evidence and act as an appellate court
Whether there was discovery of a new fact or error apparent on the record justifying review
Whether the plaintiff was ready and willing to perform his part of the contract under Section 16(c) of the Specific Relief Act
Whether a novation of the contract had occurred

Legislation cited

Code of Civil Procedure, 1908s. Order 41 Rule 1, s. Order 41 Rule 33, s. Order 47 Rule 1, s. Order 7 Rule 7, s. Section 114
Specific Relief Act, 1963s. Section 16(c), s. Section 20(2)(b)

Subjects

review jurisdictionspecific performancenovationreadiness and willingnessCPCSection 114Order 47appellate jurisdictionerror apparent on recorddiscovery of new fact

Judgment

[2009] 11 S.C.R. 252

A INDERCHAND JAIN (D) THROUGH L.RS.
v.
MOTILAL (D) THROUGH L.RS.
(Civil Appeal No. 4584 of 2009)
JULY 21, 2009
B
[S.8. SINHA AND DEEPAK VERMA, JJ.]

Code of Civil Procedure, 1908 - 'Or. 47 r. 1, s. 114 -
Review· petition - Maintainability of - Agreement for sale
C between parties - Suit for specific performance decreed in
favour of buyer - High Court in first appeal, setting aside the
decree - Remittance of matter by Division Bench of High
Court- Decree again set aside by Single Judge of High Court
- R.eview petition by parties - Single Judge of High Court
D allowed the petitions, recalled the earlier judgment and issued
directi.on. for re-hearing - Sustainability of - Held: Not
sustainable - Review application would lie when order suffers
from an error on the face of record or there is discovery of new
fact or there are sufficient reasons - Review Court does not
E sit in appeal over its own order - High Court wrongly applied
the principles of law - There was no discovery of new fact -
Thus, order of High Court set aside.

Appellant-defendant entered into an agreement to
sell property to respondent-plaintiff for Rs. 1,15,000/- out
F of which Rs. 20,000/- was paid in advance. Respondent
filed suit for specific performance. The trial court decreed
the suit in his favour holding that.in terms of the modified
contract, the respondent was to pay a further sum of Rs.
80;0001- only to the appellant. Aggrieved, appellant filed
G an appeal and the order of trial court was set aside.
During pendency of the appeal, the appellant
unconditionally withdrew the amount deposited· by the
respondent. Respondent file~ intra court appeal. Division
Bench of High Court remitted the matter. Single Judge of
H 252
INOERCHANO JAIN (0) THROUGH L.RS. v. MOTILAL 253
(0) THROUGH L.RS.

• High Court again allowed the appeal and set aside the A
order of trial court. The parties filed review petition before
the Single Judge of High Court ul Or. 47 r. 1 CPC. The
Single Judge recalled its earlier judgment and directed
the appeal to be listed for re-hearing. Hence the present
appeal. a
Allowing the appeal, the Court
.J.
HELD: 1.1. Section 114 CPC provides for a
substantive power of review by a Civil Court and
consequently by the appellate courts~ Section 114 of the c,
Code although does not prescribe any limitation on the
power of the, court but such limitations have been
provided for in Order 47 Rule 1. An application for review
would lie inter alia when the order suffers from an error
apparent on the face of the record and permitting the 0 ·
same to continue would lead to failure of justice. The
power of review can also be exercised by the court in the
event of discovery of new and important matter or ·
evidence takes place which despite exercise of due
diligence was not within the knowledge of the applicant E
or could not be produced by him at the time when the
order was made. An application for review would also lie
if the order has been passed on accoll..nt~-e

- mistake. Furthermore, an application for review shall also
lie for any other sufficient reason. The review court does F
not sit in appeal over its own order. A re-hearing of the
rltatter is impermissible. in law. It constitutes an exception
to the general rule that once a judgment is signed or
pronounced, it should not be altered. The exercise of
inherent jurisdiction is not invoked for reviewing any G
order. Review is not appeal in disguise. [Paras 8, 9· and
10] (260-H; 261-A-C; 262-A, C-F]

Rajendra Kumar v. Rambai AIR 2003 SC 2095; Lily
Thomas v. Union of India AIR 2000 SC 1650, referred to.
H
254 SUPREME COURT REPORTS . [2009) 11 S.C.R.
·-y-

A 1.2. Section 16(c) of the Specific Relief Act, 1963
mandates that the discretionary relief of specific
performance of the contract can be granted only in the
event the plaintiff not only makes necessary pleadings
but also establishes that he had all along been ready and
B willing to perform his part of contract. Such readiness
and willingness on the part of t~e plaintiff is not confined
o-nfy to the stage of filing of the plaint but also .at the •
_.._
subsequent stage, viz., at the hearing. Tht: readiness and
willingness on the part of the plaintiff in view of his
c categorical admission, therefore, was a conditional one.
It was not absolute. Probably
. keeping in view the effect
.

of such conditional offer made by him, he deposited the
entire balance amount of consideration in the court;
[Paras 12 and 13] [264-A-D]
D Umabai and Anr_. v. Nilkanth Dhondiba Chavan (Dead)
~

-t
By LRs. and Anr. (2005) 6 sec 243 and Sita Ram and Ors.
v. Radhey S~yam AIR 2008 SC 143, referred to.

1.3. The issues raised before the appellate court, viz.,
E whether there had been a novation of contract or whether
the plaintiff was ready and willing to perform his part of·
contract, as is required under section 16(c) .of the are
essentially questions of fact. The trial judge had
detei'm_ined the said issues which were appealed against. ... ~

F An appeal is a continuation of the suit. Any decision
·tak~n by the appellate court would relate back unless a
contrary intention ,is shown to the date of institution of
the suit. There cannot be any doubt that the appellate
court while exercising Jts appellate jurisdiction would be
entitled to take into cori~ideration the subsequent events
G
for the purpose ofmoulding the relief as envisaged under
Order 7, Rule 7 read with Order 41, Rule 33 CPC. The
same shall, however, not meah that the court would
proceed to do so in a review application despite holding
that the plaintiff was not entitled to grant of a decree for
H
INDERCHAND JAIN (D) THROUGH L.RS. v. MOTILAL 255
(0) THROUGH L.RS.
_,-
specific performance of contract. For the purpose of A
obtaining a decree for specific performance of contract,
the court must arrive at a conclusion that the plaintiff not
only pleaded but also established his readiness and
willingness to perform his part of contract throughout.
Exercising the discretionary jurisdiction one way or the B
other having regard to Section 20(2)(b) would depend
J.
thereupon arriving at a finding of such fact. Balancing of
_,J.
interest would be necessary provided a suit is to be
decreed and not when the suit is to be dismissed. [Para
20] [269-8-H] c
1.4. The sequence of events clearly show that the
appellate court were all along aware of the main i~sues
touching the merit of the matter. They were also aware
as to the effect or otherwise of the withdrawal of the
D
•~
amount by the appellant unconditionally as also by his
creditor. Keeping in view t.he entirety of the facts and
circumstances of the case, the appellate court arrived at
tWo crucial findings: the plaintiff had not been all along
ready an~ willing to deposit the balance sum of Rs.
., 9S,OOO/- ~nd the unconditional withdrawal on the part of E
the defendant was involuntary. The events which had
taken place subsequently, viz., registration of the said
deed of sale, purported taking over of possession of the
... suit premises by the plaintiff and alleged expenditure
incurred by him for renovation of the building, were F
within the knowledge of the parties and the court.
Therefore, it was not a discovery of a new fact which
-i despite due diligence the plaintiff could not bring to the
' . notice of the court. [Para 21] [270-A-F]

~
. 1.5. Order 41, Rule 1 stipulates that filing Qf an appeal
would. not amount to automatic stay of the execution of
the decree. The law acknowledges that during pendency
G

of the appeal it is possible for the decree holder to get
'
--t the decree executed. The execution of the decree during
f
H
256 SUPREME COURT REPORTS [2009] 11 S.C.R.

-.,,-
A pendency of the appeal would, thus, be subject to the
restitution of the property in the event the appeal is
allowed and the decree is set aside. The court only at the
time of passing a judgment and decree reversing that of
the appellate court should take into consideration the
B subsequent events, but, by no stretch of imagination, can
refuse to do so despite arriving at the findings that the
plaintiff would not be entitled to grant of a decree. ...
Discretionary jurisdiction can be exercised provided there ..l. \

is any room for the court to do same and not otherwise.
c The court while exercising its jurisdiction would not' act
arbitrarily or beyond the contours of law. The contention
of the. plaintiff that he had also prayed for grant of a
decree_·in the alternative, viz., in the event the court came
to the conclusion that there had been no novation of
contract, he was ready and willing to deposit the entire
D
amount. No conditional offer was permissible in a suit for
specific performance of contract. [Para 22] [270-G-H; 271- ~
•
A ..C]

1.6. The submission that the defendant having
E accepted novation of contract but only the quantum of
the amount being different, the court could have asked
. the plaintiff-respondent to deposit a further sum of Rs.
24,000/- cannot be accepted for more than one reason.
Apart -from the fact that such a contention had never ...
F been raised before the appellate court, keeping in view
the finding of fact arrived at that there had in fact been
no novation of contract, such a course of action was not
open. In any view of the matter, the same would amount
to. re-appreciation of evidence which was beyond the
G review juris~iction of the High Court. [Paras 23 and 24]
[271-D-F] ·
:::i.
-1.7. On the facts of the case, the High Court wrongly '
applied the principles of law as regard the review
jurisdiction of the court. The impugned judgment cannot
H
INDERCHAND JAIN (D) THROUGH L.RS. v. MOTILAL 257
(D) THROUGH L.RS.

-- be sustained and is set aside. [Paras 25, 26 and 27] [271-
G-H; 272-F; 274-E-F]
A

Board of Control for Cricket in India and Anr. v. Netaji
Cricket Club and Ors. (2005) 4 SCC 741 and Jagmohan
Singh v. State of Punjab and Ors. (2007) 7 SCC 38, referred B
to.
.. Case Law Reference:
_J,

AIR 2003 SC 2095 Referred to. Para 9
AIR 2000 SC 1650 Referred to. Para 10 c
(2005) 6 sec 243 Referred to. Para 13
AIR 2008 SC 143 Referred to. Para 13
(2005) 4 sec 141 Referred to. Para 26 D
'r (2007) 1 sec 38 Referred to. Para 26

CIVIL APPELLATE JURISDICTION : Civil Appeal No.
4584 of 2009.
E
From the Judgment & Order dated 13.10.2006 of the High
Court of Rajasthan, Bench at Jaipur in S.B. Civil Review Petition
No. 33 of 2006.
_..
._.. C.A. Sundaram, Sushil Kumar Jain, Puneet Jain, Rohini
Mousa, Archana Tiwari and Pratibha Jain for the Appellants. F

K.K. Venugopal, Abhay Kr. Bhandari, Anjali Doshi, Anuj
Bhandari, Uttara Babbar, Ashok ~umar Gupta for the
Respondents.
G
The Judgment of the Court was delivered by
.:ff
5.8. SINHA, J. ,1. Leave granted.

2. The jurisdiction of a Court and/or the extent thereof to
review its own decision is the question involved in this appeal. H
258 SUPREME COURT REPORTS [2009) 11 S.C.R.

-y
A It arises out of a judgment and order dated 13.10.2006 passed
by a learned Single Judge of the High Court of Judicature for
Rajasthan, Jaipur Bench, Jaipur in S.B. Civil Review Petition
No.33/2006 in S.B. Civil First Appeal No.36 of 1976.

3. Before adverting to the aforementioned question, we
B
may notice the admitted facts.
~
An agreement was entered into by and between the
_j_
parties on or about 15.10.1972 whereby and where under Inder
Chand Jain-appellant had agreed to sell a 'haveli' to Motilal -
c respondent for a consideration of Rs.1, 15,000/-, out of which
a sum of Rs.20,000/- was paid in advance.

Respondent filed a suit for specific performance before the
District Judge, Jaipur City, in which a decree was passed on
D 11.11.1975. Being dissatisfied, the appellant filed Civil First
f
Appeal before the High Court which was allowed on 12.03.1987
~-
whereby the judgment and order of the trial court was set aside.

On an intra court appeal filed by the respondent, a Division
Bench of the High Court by its order dated 26.10.2005
E remanded the matter back to the learned Single Judge for
deciding the appeal afresh.

By an order dated 11.08.2006, a learned Single Judge of
.._
the High Court allowed the appeal once again and set aside .¥

F the judg·ment and decree of the trial court.

4. Both the parties filed review petitions before the learned
Single Judge of the High Court under Order XLVll Rule 1 of the
Code of Civil Procedure seeking review of the judgment dated
11.08.2006. By the impugned judgment and order the learned
G Single Judge while allowing both the review petitions recalled
its earlier judgment and order dated 11.08.2006 and directed ~-
the appeal to be listed for rehearing.

5. Thus, the appellant-defendant is before this Court.
H
INDERCHAND JAIN (D) THROUGH L.RS. v. MOTILAL 259
(D) THROUGH L.RS. [S.B. SINHA, J.]
~
6. Mr. C.A. Sundaram, learned Senior Counsel appearing A
on behalf of the appellant would urge:-

(i) That the High Court exceeded its jurisdiction :in
exercise of its review jurisdiction in so far it, for all
intent and purport, acted as an appellate court.
B
(ii) The High Court in its review jurisdiction neither could
~
re-appreciate the evidence brought on record by
..).
the parties nor could exercise its discretionary
jurisdiction under Section 20 of the Specific Relief
Act, 1963. c
(iii) On the face of the findings of the Division Bench of
the High Court that the plaintiff-respondent had not
been ready and willing to perform his part of the
contract as provisions of Section 20(2)(b) of the D
•r Specific Relief Act, 1963 could be invoked only in
a case when the High Court had come to the
conclusion that the plaintiff has made out a case of
grant of decree for specific performance and not
otherwise.
E
(iv) A finding of fact having been arrived at that the
purported contention of the plaintiff that the
agreement for sale was modified in terms whereof
-· in place of Rs.1, 15,000/-. the plaintiff-respondent
was to pay a sum of Rs.80,000/- having been F
disbelieved, the High Court committed a serious
error in passing the impugned judgment.

7. Mr. K.K. Venugopal, learned senior counsel appearing
on behalf of the respondent, on the other hand, would urge that G
the High Court while passing the judgment dated 26.10.2005
' _;.f
took into consideration the salient features of this case as also
the subsequent events and, thus, was justified in passing its
order, viz.:

(i) the possession of the premises in question had H
260 SUPREME COURT REPORTS [2009) 11 S.C.R.

'"-y-
A already been delivered;

(ii) the settlement arrived at by and between the parties
with regard to the reduction of the amount of
consideration stood admitted inasmuch as
according to the appellant himself in the event the
B
tenants were evicted a sum of Rs. 11000/- may be
deducted from the amount of consideration. ...
.....
(iii) The plaintiff- respondent had deposited the entire
balance amount on 25.09.1975, i.e., two months
c prior to the passing of the decree and, thus, there
could not be any doubt or dispute that the plaintiff-
respondent had all along been ready and willing to
perform his part of contract.

D (iv) Appellant, after passing of the decree by the
learned Trial Court despite having preferred an ~·
•
appeal having himself agreed for execution of the
sale deed must be held to have accepted the
judgment and, thus, could not have been permitted
to turn round and contend that the plaintiff was not
E
ready and willing to perform his part of contract.

(v) Withdrawal of an amount of Rs. 35,000/- in terms
of the judgment of the Trial Court by the appellant
_)-
without any gemur would not in law alter the
F situation.

(vi) A registered deed of sale having been executed
pursuant to the order of the Executing Court and the
appellant having been put in possession of the
premises in suit having expended a huge amount
G
_ by way of renovation of the 'haveli' .. the learned
Judge rightly found that it would be inequitable to \...
refuse to pass a judgment of specific performance
of contract.
H 8. Section 114 of the Code of Civil Procedure (for short
•
INDERCHAND JAIN (0) THROUGH L.RS. v. MQTILAL 261
(D) THROUGH L.RS. [S.B. SINHA, J.]
" '
-<-
"the Code") provides for a substantive power of review by a A
Civil Court and consequently by the appellate courts. The words
"subject as aforesaid" occurring in Section 114 of the Code
means subject to such conditions and limitations as may be
prescribed as appearing in Section 113 thereof and for the said
purpose, the procedural conditions contained in Order 47 of the B
Code must be taken into consideration.
.....
9. Section 114 of the Code although does not prescribe
_.-1,
any limitation on the power of the court but such limitations have
been provided for in Order 47 of the Code; Rule 1 whereof
reads as under: c
"17. The power of a civil court to review its judgment/
decision is traceable in Section 114 CPC. The grounds
on which review can be sought are enumerated in Order
47 Rule 1 CPC, which reads as under: D
•-t' "1. Application for review of judgment.-(1) Any person
considering himself aggrieved-

(a) by a decree or order from which an appeal is allowed,
but from which no appeal has been preferred, E

(b) by a decree or order from which no appeal is allowed,
or
"""'
II!"__., .,._
(c) by a decision on a reference from a Court of Small
Causes,
F

and who, from the discovery of new and important matter
or evidence which, after the exercise of due diligence was
not within his knowledge or could not be produced by him
at the time when the decree was passed or order made, G
or on account of·some mistake or error apparent on the
-lf
face of the record, or for any other sufficient reason,
~
desires to obtain a review of the decree passed or order
made against him, may apply for a review of judgment to
the court which passed the decree or made the order." H
262 SUPREME COURT REPORTS [2009] 11 S.C.R.

A An application for review would lie inter alia when the order
suffers from an error apparent on the face· of the record and
permitting the same to continue would lead to failure of justice.
In Rajendra Kumar v. Rambai [AIR 2003 SC 2095], this Court
held:
B "The limitations on ex~rcise of the power of review are well
settled. The first and foremost requirement of entertaining
a review petition is that the order, review of which is sought,
suffers from any error apparent on the face of the order and
permitting the order to stand will lead to failure of justice.
c In the absence of any such error, finality attached to the
judgment/order cannot be disturbed. n

The power of review can also be exercised by the court in
the event discovery of new and important matter or evidence
o takes place which despite exercise of due diligence was not

+•
within the knowledge of the applicant or could not be produced
by him at the time when the order was made. An application
for review would also lie if the order has been passed on
account of some mistake. Furthermore, an application for
E review shall also lie for any other sufficient reason.

10. It is beyond any doubt or dispute that the review court
does not sit in appeal over its own order. A re-hearing of the
matter is impermissible in law. It constitutes an exception to the
general rule that once a judgment is signed or pronounced, it
F should not be altered. It is also trite that exercise of inherent
jurisdiction is not invoked for reviewing any order.

Review is not appeal in disguise.

G In Lily Thomas v. Union of India [AIR 2000 SC 1650], this
Court held:

"56. It follows, therefore, that the power of review can be ..
exercised for correction of a mistake and not to substitute_
a view. Such powers can be exercised within the limits of
H th·e statute dealing with the exercise of power. The review
INOERCHANO JAIN (0) THROUGH L.RS. v. MOTILAL 263

-- -.- (0) THROUGH L.RS. [S.B. SINHA, J.]
cannot be treated an appeal in disguise." A

11. Respondent in his plaint inter alia raised a plea of
novation of contract. Such a plea was advanced on the premise
that a substantial· amount was to be expended for eviction of
the tenants who were occupying the premises in question.
B
For the said purpose, reference was made to Clause 13
.... of the agreement dated 15.10.1972. Undoubtedly, defendant
- appellant denied and disputed that any modification in the
""' said agreement had taken place as a result whereof the
balance amount payable was Rs. 80,000/. A bare perusal of c
Clause 13 of the said agreement categorically shows that the
expenses for vacating the tenant were to be made through the
defendant- appellant only. It was for the defendant- appellant
to accept any payment from the plaintiff - respondent. Clause
13 does not envisage any expenditure on the part of the plaintiff 0
t' on the said account. It may, however, be correct that the
-t- defendant - appellant in his deposition accepted that he had
made a representation to the plaintiff that in the event the tenants
are evicted on payment of the sum specified therein, the amount

.. so paid may be deducted from the amount of consideration.
According to him, the amount in question was a sum ofRs .
11,000/-. He, however, contended that no amount was paid to
E

the tenant.

-
..._ Before the learned Trial Judge, both the parties adduced
their respective evidences. The plaintiff - respondent in cross- F
examination was -asked the following question:

"Whether or not you are prepared to purchase the house,
even if Sard~rmalji and lnderchandji could not settle the
dispute of Rathiji, as has been mentioned by you in your G
paper?"·

·"" In answer thereto, he stated as under:
----(
"If the defendant lnderchandji is prepared & ready to set
off Rs. 30,000/- against the cost of the house then I am
I •
H

I
264 SUPREME COURT REPORTS [2009] 11 S.C.R.
...
A prepared to purchase the house." ' -y

.12. The readiness and willingness on the part of the plaintiff
in view of his categorical admission, therefore, was a
conditional one. It was not absolute. Probably keeping in view
the effect of such conditional offer made by him, he deposited
B the entire balance amount of consideration in the court on
25.09.1975.
~

13. Section 16(c) of the Specific Relief Act, 1963 ,.._
mandates that the discretionary relief of specific performance
c of the contract can be granted only in the event the plaintiff not
only makes necessary pleadings but also establishes that he
had all along be~n ready and willing to perform his part of
contract. Such readiness and willingness on the part of the
plaintiff is not confined only to the stage of filing of the plaint
D but also at the subsequent stage, viz., at the hearing. It has been
so held in Umabai and Another v. Nilkanth Dhondiba Chavan "
-)-
(Dead) By LRs. And Another [(2005) 6 SCC 243) in the
following. terms:

E
"30. It is now well settled that the conduct of the parties,
with a view to arrive at a finding as to whether the plaintiff-
respondents were all along and still are ready and willing
to perform their part of contract as is mandatorily required
..
F
under Section 16(c) of the Specific Relief Act must be
determined having regard to the entire attending > -'
circumstances. A bare averment in the plaint or a
statement made in the examination-in-chief would not
suffice. The conduct of the plaintiff-respondents must be
judged having regard to the entirety of the pleadings as
also the evidences brought on records.
G
31. In terms of Forms 47 and 48 appended to Appendix
A of the Code of Civil Procedure, the plaintiff must plead
that "he has been and still is ready and willing specifically
to perform the agreement on his part of which the
defendant has had notice" or "the--plaintiff is still ready and
H
INOERCHANO JAIN (0) THROUGH L.RS. v. MOTILAL 265
(0) THROUGH L.RS. [S.B. SINHA, J.]
....-- willing to pay the purchase money of the said property to A
the defendant". The offer of the plaintiff in the instant case
is a conditional one and, thus, does not fulfil the
requirements of law."

Yet again in Sita Ram & Ors. v. Radhey Shyam, [AIR R
2008 SC 143], while referring to Ardeshir H. Mam v. Flora
Sassoon [AIR 1928 PC 208] this Court opined as under:
~

,A "the Privy Council observed that where the injured party
sued at law for a breach, going to the root of the contract,
he thereby elected to treat the contract as at an end himself c
and as discharged from the obligations. No further
performance by him was either contemplated or had to be
tendered. In a suit for specific performance on the other
hand, he treated and was required by the Court to treat
the contract as still subsisting. He had in that suit to allege, 0
'!" and if the fact was traversed, he was required to prove a
-4"
continuous readiness and willingness from the date of the
contract to t~e time of the hearing, to perform the contract
on his part"
E.
14. It is no doubt true that the learned Trial Judge decreed
the suit inter alia opining that in terms of the modified contract,
the plaintiff was to pay a further sum of Rs. 80,000/- only to the
defendant. The defendant did not accept the said finding. He
-..._ preferred an appeal. Admittedly, he filed three applications for
F
stay. The learned Single Judge before whom th~/third stay
application came up for hearing, by an order datetl 9.11.1977
recorded as under:

.•
''This is the 3rd stay application. No new ground
exists for grant of stay. Indeed, the equities are not in G
favour of the defendant.
<,, "
-< Since ihe defendant was not in a position to deliver
the vacant possession of the Haveli in suit, the plaintiffs
were entitled to a decree for specific performance, on
H
266 SUPREME COURT REPORTS [2009) 11 S.C.R.

A payment of Rs. 80,000/- in the shape of its price.
Admittedly, the plaintiffs deposited Rs. 20,000/- on
15.10.1972 and Rs. 95,000/- on 24.09.1975, i.e., Rs.
1, 15,000/- in all, towards the price of the Haveli on the
expectation that the defendant would deliver vacant
B possession.

The contention that the plaintiffs are not entitled to
execute the decree beca.use a sum of Rs. 60,000/- is not ~

in deposit, is wholly unwarranted. The plaintiffs had actually >-
deposited Rs. 1, 15,000/, as stated above. The deposit
c was tantamount to payment.

As the 2nd condition becomes operative, the
plaintiffs withdrew the excess amount of Rs. 35,000/- as
well as the costs amounting to Rs. 7075/-. They were
D entitled to their costs and therefore could deduct the same
under Order XX rule 6(3) of the Code of Civil Procedure ..,
.....
and, therefore, Rs. 7075/- have to be deducted from Rs.
60,0001-. The order sheet of the executing court dated
15. 10.1977 shows that a ·creditor of the defendant has
E withdrawn Rs. 6952.37 p.
I
There is no non-compliance of the terms of the
decree on the part of the plaintiffs and they are entitled to
get the 2 sale-deeds registered in the terms of the decree
and no question of requiring the plaintiffs to deposit the .x
F further sum of Rs. 7000/- arises.

The application for stay is, therefore, rejected."

It was in the aforementioned situation, Mr. Sundaram may
G be justified in contending that the appellant had no other option
but to agree to the execution of the document.

The learned Single Judge by an order dated 12.03.1987 ·""'- }'

allowed the appeal and the judgment of the Trial Court was set
aside.
H
INDERCHAND JAIN (D) THROUGH L.RS. v. MOTILAL 267
(D) THROUGH L.RS. [S.B. SINHA, J.]
--('"" 15. On an intra-court appeal by the respondent, the matter A
was finally heard by the Division Bench. As regards, the effect
of unconditional withdrawal of the amount during pendency of
the appeal, the Division Bench noticed:

"It appears that S.B. Civil First Appeal No.36/1976 was
B
filed on April 22, 1976 by the defendant -respondent and
during pendency of the first appeal, the amount deposited
.
....
by the plaintiff was withdrawn by the defendant
unconditionally and the Executing Court thereafter
registered the sale deed in pursuance of the decree of the
lower court. However, at the time of deciding the First c
Appeal, this fact escaped attention of the learned Single
Judge. In our opinion, it was necessary for the learned
Single Judge to analyse the effect of unconditional
withdrawal of money by the defendant during the pendency
of appeal." D
,..
t-
16. Keeping in view the aforementioned finding, the
Division Bench could have remitted the matter for a limited
purpose. It, however, did not do so. It unjustifiably remitted the
entire matter. Legality of such an order is, however, not in E
question.

17. The learned Single Judge of the High Court upon
consideration of all materials and evidences available on-record
. allowed the appeal and set aside the judgment and decree
I

F
passed by the learned Trial Judge by an order dated
11.08.2006, stating :

" ... Thus, in view of the evidence brought on record it must
be concluded that the plaintiff respondent has not been
able to prove the said oral agreement with respect to the. G
reduction of sale price by Rs. 35,000/-. It· has not been
_;-; established as to at which place and on what date the
alleged oral agreement between the parties had taken
~
place. Meaning thereby, the plaintiff Motilal, in my
considered view, was not ready and willing to purchase the H
268 SUPREME COURT REPORTS [2009] 11 S.C.R.

A haveli in question at any point of time ...

... Since the plaintiff accepted the payment after execution
of decree by registration of sale deed through court on
24.02.1978, therefore, withdrawal/ acceptance of Rs.
45972/- in compliance of executing court's order dated
B 10.03.1978 cannot be said to have an adverse effect on
the case of the defendant appellant." ·

18. The said judgment was accepted as no appeal was )...
preferred thereagainst. It was only thereafter a review
C application was.filed by both the parties.

19. Whereas the defendant - appellant filed a review
application confined to the question that he was entitled to the
restitution of the property and mesne profit in respect whereof
the l~arned Single Ju~ge. of the Hi~h Court did not ~~ss any
0 .,.
. specific order, the application for review filed by the respondent
was on the merit of the judgment. The relevant grounds of review
which have been placed before us relate to :

(i) Unconditional withdrawal of some amount by one
E of the creditors of the defendant as also the
defendant himself;

(ii) The defendant's application before the Executing
Court that he was ready and willing to ;get the sale
deed executed on receipt of amount in cash and
F
the said admission allegedly was not brought to the
notice of the court;

(iii) While holding that there was no agreement to
reduce the sale consideration, the High Court had
G ignored the fact that it was an admitted case of the
parties, as stipulated in the contract, that the
defendants would get the premises vacated from
the tenants within three months.

H (iv) Appellant had prayed for an alternative relief, viz.,
INDERCHAND JAIN (D) THROUGH L.RS. v. MOTILAL 269
(D) THROUGH L.RS. [S.B. SINHA, J.]
......,-
that he was ready to get the decree for specific A
performance of contract by paying Rs. 1, 15,000/-.
The court did not consider the evidence of DWs 1
to 6 in their proper perspective.

(v) The court did not consider that the property could B
not be restored back to the defendant - appellant
and ~s such the court should have exercised its
"'
.A discretionary jurisdiction .

20. The issues raised before the appellate court, viz.,
whether there had been a novation of cJntract or whether the c
plaintiff was ready and willing to perform his part of contract, -
as is required under Section 16(c) of the Specific Relief Act,
are essentially questions of fact. The Trial Judge had
determined the said issues which were appealed against. An
,. appeal is a continuation of the suit. Any decision taken by the D
~ appellate court would relate back unless a contrary intention is
shown to the date of institution of the suit: There cannot be any
doubt that the appellate court while exercising its appellate
jurisdiction would be entitled to take into consideration the
subsequent events for the purpose of rrioulding the relief as e:
envisaged under Order 7, Rule 7 read with Order 41, Rule 33
of the Code of Civil Procedure. The same sh~H. however, not
mean that the c_~urt would proceed to do so in a review
.......
'). application despite holding that the plaintiff was not entitled to
grant of a decree for specific performance of contract. For the F
purpose of obtaining a decree for specific performance of
contract, the court must arrive at a conclusion that the plaintiff
not only pleaded but also established his readiness and
willingness to perform his part of contract throughout. Exercising
the discretionary jurisdiction one way or the other having regard
G
to Section 20(2)(b) would depend tnereupon arriving at a
_,,7
finding of such fact.

Balancing of interest would be necessary provided a suit
is to be decreed and not when the suit is to be dismissed.
H
270 SUPREME COURT REPORTS [2009) 11 S.C.R.

A 21. The sequence of events to which we have adverted to
heretobefore clearly go to show that the appellate court were
all along aware of the main issues touching the merit of the
matter. They were also aware as to the effect or otherwise of
the withdrawal of the amount by the appellant unconditionally as
B also by his cr~ditor. The plaintiff - respondent on the
aforementioned premise was entitled to contend and in fact
contended that unconditional withdrawal of a part of the ...
deposited amount would preclude the appellant from pursuing ).,

the appeal. The question as to whether by reason of such
c withdrawal, he had accepted the judgment passed by the
learned Trial Judge and, thus, was estopped and precluded
from pursu~g his appellate remedy was one of the points which
fell for con ideration before the appellate court.

Keeping in view the entirety of the facts and circumstances
D of the case, the appellate court arrived at two crucial findings: '"f
~

(i) The plaintiff had not been all along ready and willing
to deposit the balance sum of Rs. 95,000/-.

(ii) The unconditional withdrawal on the part of the
E
defendant was invoh.mtary.

The events which had taken place subsequently, viz.,
registration of the said deed of sale, purported taking over of
,A;
possession of the suit premises by the plaintiff and alleged
F expenditure incurred by him for renovation of the building, were
within the knowledge of the parties and the court. It was,
therefore, not a discovery of a new fact which despite due
diligence the plaintiff could not bring to the notice of the court.

G 22. Order 41, Rule 1 of the Code stipulates that filing of
an appeal would not amount to automatic stay of the execution
'f:',
of the decree. The law acknowledges that during pendency of
the appeal it is possible for the decree holder to get the decree
executed. The execution of the decree during pendency of the
appeal would, thus, be subject to the restitution of the property
H
INDERCHAND JAIN (D) THROUGH L.RS. v. MOTILAL 271
(D) THROUGH L.RS. [S.S. SINHA, J.]
in the event the appeal is allowed and the decree is set aside. A
The court only at the time of passing a judgment and decree
reversing that of the appellate court should take into
consideration the subsequent events, but, by no stretch of
imagination, can refuse to do so despite arriving at the findings
that the plaintiff would not be entitled to grant of a decree.
Discretionary jurisdiction, it is trite, can be exercised provided
a
... there is any room for the court to do same and not otherwise .
A The court while exercising its jurisdiction would not act arbitrarily
or beyond the contours of law. The contention of the plaintiff that
he had also prayed for grant of a decree in the alternative, viz., c
in the event the court came to the conclusiora that there had
been no novation of contract, he was ready and willing to
deposit the entire amount. No conditional offer was permissible
in a suit for specific performance of contract.

23. Contention of Mr. Venugopal that the defendant having D
-t" accepted novation of contract but only the quantum of the
amount being different, the court could have asked the plaintiff
- respondent to deposit a further sum of Rs. 24,000/- cannot
be accepted for more than one reason. Apart from the fact that
such a contention had never been raised before the appellate E,
court, keeping in view the finding of fact arrived at that there
had in fact been no novation of contract, such a course of action
was not open. In any view of the matter, the same would amount
-.
Jo. to re-appreciation of evidence which was beyond the review
jurisdiction of the High Court. F
24. We have noticed hereinbefore, that under what
circumstances the aforementioned amount of Rs. 1, 15000/-
was deposited by the respondent. He might have been advised
to do so keeping in view the fact that, according to him, he was
G
ready and willing to perform his part of contract provided the
' --"' balance amount of consideration was reduced to Rs. 80,000/

25. The High Court had rightly noticed the review
jurisdiction of the court, which is as under: H,
272 SUPREME COURT REPORTS [2009] 11 S.C.R.

~
A "The law on the subject - exercise of power of review, as
propounded by the Apex Court and various other High
.Courts may be summarized as hereunder: I

(i) Review proceedings are not by way of appeal and
have to be strictly confined to the scope and ambit
B
of Order 47 Rule 1 C.P.C.

(ii) Power of review may be exercised when some ...
~
mistake or error apparent on the fact of record is A
found. But error on the face of record must be such
c an error which must strike one on mere looking at
the record and would not .re((uire any long drawn
process of reasol)ing~,0n the>points where there
may be conceivable tie~o opinions.

D (iii) Power of review may not be exercised on the
,ground that the decision was erroneous on merits.
"")--

(iv) Pdwer of review can also be exercised for any
sufficient reason which is wide enough to include
a misconception of fact or law by a court or even
E an Advocate.

(v) An application for review may be necessitated by
way of invoking the doctrine 'actus curiae neminem
g ravabit'." k
F
26. In our opinion, the principles of law enumerated by it,
in the facts of this case, have wrongly been applied.

In Board of Control for Cricket in India & Anr. v. Netaji
Cricket Club & Ors. [(2005) 4 SCC 741 ], this Court held :
G
"89. Order 47 Rule 1 of the Code provides for filing an
'y.._
application for review. Such an application for review would
be maintainable not only upon discovery of a new and
important piece of evidence or when there exists an error
apparent on the face of the record but also if the same is
H
- ·--r
INDERCHAND JAIN (D) THROUGH L.RS. v. MOTILAL 273
(D) THROUGH L.RS. [S.S. SINHA, J.]
necessitated on account of some mistake or for any other
sufficient reason.
A

90. Thus, a mistake on the part of the court which would
include a mistake in the nature of the undertaking may also
call for a review of the order. An application for review B
would also be maintainable if there exists sufficient reason
therefor. What would constitute sufficient reason would
depend on the facts and circumstances of the case. The
,J..
words "sufficient reason" in Order 47 Rule 1 of the Code
are wide enough to include a misconception of fact or law
by a court or even an advocate. An application for review
c
may be necessitated by way of invoking the doctrine "actus
curiae neminem gravabit"."

It was furthermore observed:
D
"94. In Rajesh D. Darbar and Ors. v. Narasingrao
-( Krishnaji Kulkarni and Ors. (2003)7SCC219 , this Court
noticed:

"4. The impact of subsequent happenings may now
be spelt out. First, its bearing on the right of action, E
second, on the nature of the relief and third, on its
importance to create or destroy substantive rights.
Where the nature of the relief, as originally sought,
has become obsolete or unserviceable or a new
-· form of relief will be more efficacious on account F
of developments subsequent to the suit or even
during the appellate stage, it is but fain that the relief
is moulded, varied or reshaped in the light of
" updated facts.
G
The courts can take; notice of the subsequent events
---ti and can mould the relief accordingly. But there is a
rider .to these well establis~ed principles. This can
be done only in exceptional circumstances, some
of which have been highlighted above. This H
274 SUPREME COURT REPORTS [2009] 11 S.C.R.
~

A equitable principle cannot, however, stand in the -y

way of the court adjudicating the rights already
vested by a statlite. ·This well settled p.osition need
not detain us, wf:len t~e second point u_rged by the
appellants is focused. There can be no quarrel with
B tbe proposition as noted .by the High Court that a
party cannot be made to suffer on account of an act
of the Court. There is a well recognised maxim of
equity, namely, actus curiae neminem gravabit ).._
which means an act of the Court shall prejudice no
c - man. This maxim is founded upon justice and good
sense which sel'Ves a safe and certain guide for the
administration of law. The other max:im is, lex non
cogit ad impossibilia, i.e. the law does not compel
a man to do that what he cannot possibl~ perform".
D Furthermore, in Jagmohan Singh v. State of Punjab &
Ors. [(2007) 7 SCC 38], this Court_beld : --)-

"It is furthermore evident that Order 47 Rule 1 of the Code
of Civil Procedure does not precludeJhe High Court or a
E court to take into consideration any subsequent event. If
imparting--of ju~ice in a given situation is the goal of the
judi_<?jary,---the co~rt may take into consideration (of course
·,
on-rare occasions) the subsequent events."
~
27. Foi~the reasons aforementioned, the impugned
F
judgment cannot be sustained which is set aside accordingly.
·-
The appeal is allowed. However, it would be open to the plaintiff
- respondent to file an appropriate application for recovery of '
such amount or amounts which he ri:i~_gbj_have expended ..
towards renovation of the building, which may be considered
G on its own merits. The court shall furthermore -determine the
amount of mesne profit which became payable to the appellant. -.,..__
It would be open to the court to adjust the amount payable by
the plaintiff to the defendant and vice-versa.

H N.J. Appeal allowed.