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Supreme Court of India

K.PRAKASHversusB.R. SAMPATH KUMAR

Citation
2014 INSC 659
Decided
22 September 2014
Disposal
Appeal(s) allowed

Holding

A valid agreement to sell, proved under Section 16(c) and satisfying Section 20, warrants specific performance, and a rise in price does not defeat the decree, though the court may impose a compensatory condition.

Summary

The appellant, K. Prakash, sued B.R. Sampath Kumar for specific performance of a 2003 agreement to sell a Bangalore property for Rs.16.10 lakh, having paid Rs.5.45 lakh as advance. The respondent contended the agreement was signed under mental pressure and that the price was far below market value, seeking to set aside the decree. The trial court granted specific performance, but the Karnataka High Court reversed it, holding the agreement was not executed with free volition. The Supreme Court held that the agreement was valid, the plaintiff satisfied Section 16(c) of the Specific Relief Act, and the court must exercise its discretionary jurisdiction in favour of specific performance. It further ruled that a subsequent rise in property price does not invalidate the decree, though the court may impose a condition to adjust consideration. Accordingly, the appeal was allowed, the High Court order set aside, and the trial court decree restored with a modified consideration of Rs.25 lakh.

Issues considered

  • The validity of the agreement to sell and whether it was executed with free mind and volition.
  • Whether the plaintiff satisfied the conditions under Section 16(c) and Section 20 of the Specific Relief Act for specific performance.
  • Whether a substantial increase in market price of the property constitutes a hardship that defeats specific performance.
  • Whether the appellate court erred in exercising its discretion in overturning the trial court's decree.

Legislation cited

Subjects

specific performanceequitable remedydiscretionary jurisdictionrise in property pricecontract to sellfree volitioncondition precedentmodification of decree

Judgment

                        [2014] 13 S.C.R. 702


A                           K.PRAKASH
                                  v.
                      B.R. SAMPATH KUMAR
                  (Civil Appeal No. 904 7 of 2014)
B                     SEPTEMBER 22, 2014
      [M. Y. EQBAL AND PINAKI CHANDRA GHOSE, JJ.]
        Specific Relief Act, 1963 - ss.16(c) and 20- Specific
  performance of contract -Agreement to sell property- Suit
c for specific performance of the agreement - Held: Remedy
  for specific performance is an equitable remedy- The Court
  while granting relief for specific performance exercises
  discretionary jurisdiction - Discretion must be exercised in
  accordance with sound and reasonable judicial principles -
D On facts, High Court erred in holding that the agreement was
  executed by respondent without free mind and volition and
  under some pressure - Once an agreement to sell is legal
  and validly proved and further requirements for getting such
  a decree is established then the Court has to exercise its
E discretion in favour of granting relief for specific performance.
       Specific Relief Act, 1963- ss.16(c) and 20- Specific
  performance .of contract - Agreement to sell property -
  Subsequent rise in price - Effect - Held: Rise in price is a
  normal change of circumstances and, therefore, on that
F ground a decree for specific performance cannot be reversed
  - However, the court may take notice of the fact that there
  has been an increase in the price of the property and
  considering the other facts and circumstances of the case,
  while granting decree for specific performance can impose
G such condition which may to some extent compensate the
  defendant-owner of the property.
         All~:>wing the appeal, the Court

       HELD:1.1. The High Court has not approached the
H issue in its right perspective and has committed serious
                              702
            K. PRAKASH v. B.R. SAMPATH KUMAR                   703


    error of law in holding that the agreement was executed A
    by the defendant without free mind and volition and
    under some pressure. [Para 14][712-A-B]
         1.2. Remedy for specific performance is an
    equitable remedy. The· Court while granting relief for
    specific performance exercise discretionary jurisdiction. B
    Discretion must be exercised in accordance with the
    sound and reasonable judicial principles. It is true, as
    contemplated under Section 20 of the Specific Relief Act,
    that a party is not entitled to get a decree for specific
    performance merely because it is lawful to do so. c
    Nevertheless once an agreement to sell is legal and
    validly proved and further requirements for getting such
    a decree is established then the Court has to exercise
    its discretion in favour of granting relief for specific
    performance. [Paras 15, 17][713-A-B; 714-F]               D

         Rookey's case, 77 ER 209; (1597) 5 Co. Rep. 99
         and Attorney General vs. Wheat (1759) 1 Eden
         177; 28 ER 652 - referred to.
         2.1. Subsequent rise in price willnot be treated as E
    a hardship entailing refusal of the decree for specific
    performance. Rise in price is a normal change of
    circumstances and, therefore, on that ground a decree
    for specific performance cannot be reversed. However,
    the court may take notice of the fact that there has been F
    an increase in the price of the property and considering
    the other facts and circumstances of the case, the
(   Court while granting decree for specific performance
    can impose such condition which may to some
    extent compensate the defendant-owner of the property. G
    [Paras 19, 20][715-A-C]
         2.2. On facts, ten years have passed by and now
    the price of the property in that area where it situates
    has increased by not less than five tir:nes. Keeping in
                                                               H
704         SUPREME COURT REPORTS                  [2014] 13 S.C.R.


A mind the factual position, the appellant should pay a total
  consideration of Rs.25 lakhs, being the price for the said
  property (whereas the agreement to sell in question was
  executed by the respondent-owner in the year 2003 for
  total consideration of Rs.16.10 lakhs). [Para 21]
B [716-C-D]
           Nirma/a Anand vs. Advent Corporation (P) Ltd.
           and Others (2002) 8 SCC 146: 2002 (2) Suppl.
           SCR 706 - relied on.

c                          Case Law Reference:
      77 ER 209                      referred to        Para 16
      28 ER 652                      referred to        Para 16
      2002 (2) Suppl. SCR 706        relied on          Para 20
D         CIVIL APPELLATE JURISDICTION: Civil Appeal No.
      9047of2014.
      · From the judgment and order dated 23.08.2011 passed
  by High Court of Karnataka at Bangalore in R.F.A. No. 396 of
E 2007.
           Sanjay Parikh, Ms. Anitha Shenoy, Ms. Vishruti Vijay,
      Advs. for the Appellant.
           P. Vishwantha Shetty, Sr. Adv., Ms. Kheyali Sarkar, E.C.
      Vidya Sagar, Ms. Jennifer Joh, Advs. for the Respondent.
 F
           The Judgment of the Court was delivered by
           M. Y. EQBAL, J.: 1. Leave granted.
         2. This appeal by special leave is directed against the
G judgment and order dated 23.8.2011 passed by the High Court
  of Karnataka whereby Regular First Appeal No.396 of 2007
  of the respondent was allowed, reversing the judgment of the
  trial court and dismissing the suit for specific performance of
  the agreement filed by the plaintiff-appellant.
 H
          K. PRAKASH v. B.R. SAMPATH KUMAR                         705
                   [M. Y. EQBAL, J.]

     2. The facts of the case lie in a narrow compass.             A
      3. All disputes pertain to a self acquired property of the
father of the respondent. The respondent's father had four
sons and three daughters. On 31. 7 .1988, transfer of Khata
was executed by all brothers and sisters in the name of the
respondent. After the demise of their parents, partition seems     B
to have taken place on 14.12.2000 among brothers and sisters
and the property in question is said to have fallen to the share
of defendant, who was required to pay a sum of Rs.1,25,000/
- to each of the brothers and sisters in lieu of their shares in
the suit house. The plaintiff had paid Rs.1,25,000/- to all his    C
brothers and sisters except brother Selva Pillai.
       4. The respondent herein executed an Agreement for
Sale in favour of the appellant on 15.12.2003 agreeing to sell
the schedule property for a total sale consideration of 0
Rs.16, 10,000/-. The schedule property is located at Bangalore,
admeasuring 30 x 45 feet with built up area of 1700 sq.ft.,
consisting of ground floor and first floor including out house.
The ground floor is occupied by the respondent and the first
floor is occupied by the appellant. as a mortgagee. The out- E
house is occupied by the brother of the defendant-respondent
namely Sheshadri (as mortgagee). It is relevant to note that
an amount of Rs.3, 75,000/- was paid by the appellant to the
respondent as requested by the respondent and Sheshadri,
who is occupying the out-house portion, has paid Rs.1,65,000/ F
- as a mortgage consideration to the respondent while
occupying the house. Agreement further reveals that the
aforesaid amounts shall be treated as advance amount
received by the respondent under the agreement of sale. The
understanding between the parties is that the mortgage G
consideration need not be repaid by the respondent to the
mortgagees including Sheshadri and his mortgage
consideration will be repaid by the prospective vendee i.e.
the appellant. However, on the date of execution of sale
agreement, only a sum of Rs.5,000/-was paid by the appellant H ..
706        SUPREME COURT REPORTS                 [2014] 13 S.C.R.


A to the respondent. Thus, in nll a sum of Rs.5,45,000/- is said
  to have been paid by the appellant. The plaintiff could raise
  loan of Rs.3 lakh by securing property. The remaining sale
  consideration of Rs. 7,65,000/-was payable to the respondent
  within one year from the date of the agreement, and in case
B respondent fails to comply with any of the conditions in the
  agreement, he woul~ repay double the amount i.e.
  Rs.10,90,000/- to the appellant.
        5. Although prescribed time was one· year, litigation
  seems to have started between the parties within three months.
C Repeated complaints were filed by the appellant against the
  respondent before the police authorities. At last, appellant-
  p!aintiff moved .a suit on 9.7.2004 praying fora decree of
  specific performance· on the ground tha~ ·the respondent-
  defendant has denied the execution of the sale deed. The
D suin and substance of the appellant-plaintiff's-case is that the
  defendant-respondent has failed to perform his part of the
  contract though the appellant-plaintiff was re3dy and willing to
  perform his part of the contract.
 E        6. The defendant-respondent denying Agreement Ex.P1
   pbaded in his written statement that them being difference of
   opinion between himself and his brothers, he v1as in highly
   disturbed state of mind and when he'apprcached ihe appellant
   for suggestion and help, appellant took his signature on the
 F alleged agreement of sale and he signed it since he had
   implicit faith in the appellant. The appel!ant-plaintiff had
   assured that B.R. Sheshadri - brother of the respondent-
   defendant, who was living in the out-house, would _be made to
   vacate the premises in the guise of interest·beif)g created in
 G favour of appellant in the property. It has also been contended
   that the respo.ndent had no intention to execute the agr~ement
   of.sale.or to sell the property and the agreement was entered
   i(lto only for the. purpose of securing the loan and.the property
   was mortgaged as a security for the loan.

 H
          K. PRAKASH v. B.R. SAMPATH KUMAR                       707
                   [M. Y. EQBAL, J.]

      7. After hearing argument on both sides, the trial court   A
decreed the suit in favour of the plaintiff-appellant with a
direction to the defendant-respondent to execute the absolute
sale deed in favour of the plaintiff, free from all claims and
encumbrances, by receiving the balance consideration of
Rs.10,65,000/" and to hand over the vacant and peaceful          B
possession of the suit Schedule Property to the plaintiff.
Aggrieved by the decision, the defendant-respondent
preferred an appeal before the High Court, which passed the
impugned order setting aside the decree of the trial court and
dismissing the suit for specific performance. Hence, this        c
appeal by special leave by the plaintiff.
       8. Mr. Sanjay Parikh, learned counsel appearing on behalf
of the appellant contended that instead of adverting to and re-
appreciating the evidence on record, the High Court erred in
a,rriving at the findings based on conjectures and surmises. D
The appellant-plaintiff has complied with the provisions of
Section 16(c) of the Specific Relief Act by establishing his
willingness to perform his part of the contract whereas the
respondent-defendant failed to do so. It is further contended
that the respondent has admitted by way of affidavit dated E ·
10.10.2006 that he executed the Agreement of sale dated
15.12.2003 and also by letter dated 21.1.2004 further admitted
that he has executed aforesaid agreement and he had already
received a sum of Rs.5,45,000/- as part payment of the total
sale consideration. At the instance of appellant, on 16.2.2004 F
Syndicate Bank issued two cheques one for Rs.10,65,000/-
in favour of the respondent towards balance amount of sale
consideration and another for Rs.1, 19,840/- in favour of Sub-
Registrar, Rajajinagar, Bangalor.e for payment of the
registration charges of the said sale deed. As contended, on G
failure of the respondent to reply legal notice of the appellant
and execute the sale deed in favour of the appellant, the
appellant had to move a suit for relief of specific performance
directing the respondent to receive the .balance sale
                                                                 H
708        SUPREME COURT REPORTS                  [2014] 13 S.C.R.


A consideration to execute an absolute·sale deed in favour of
  the appellant. Learned counsel drew our attention to the
  exhibits and the evidence of the defendant-respondent and
  submitted that the appellate court has committed serious
  illegality in ignoring these materials and reversed the finding
B of the trial court.
          9. Per contra, Mr. Vishwanath Shetty, learned senior
   counsel appearing on behalf of respondent, submitted that
   taking advantage of financial crises and disturbed state of mind
   of the respondent, the appellant suggested him to execute an
 C agreement of sale and without revealing its contents took his
   signature on the agreement, which was mc;1de only for nominal
   purpose and he had no intention to sell the property. It is further
   contended that the appellant had concocted and fabricated
   the agreement. It is alleged by the respondent that since
 D appellant did not perform his part of the contract, the entir.e
   alleged agreement stood cancelled. Prevailing circumstances
    had forced respondent to write aforesaid letter dated 21.1.2004
    calling appellant to pay the entire amount. Alleged agreement
    and letter were created by the appellant under suspicious
 E circumstances and mental pressure of the defendant-
    respondent, and as such, they are not legally enforceable for a
    decree under Section 16(c) read with Section 20 of the
    Specific Relief Act, 1963. The High Court has held that there
    was payment of only Rs.5000/- to the defendant as against
 F the claim of the plaintiff that he has paid a sum ofRs.5,45,000/
    - under Ex.P1 and P2. It has been further contended on behalf
    of the respondent that the market value of the property in the
    year 2003 in Bangalore was much more to the consideration
    amount contained in Ex. P1 and P2. The whole transaction
 G was nothing but farce. Respondent contends that taking into
    consideration all aspects of the matter, the High Court is right
    in mversing the judgment of the trial court, which had ignored
    the material evidence on record with regard to the conduct of
    the plaintiff~appellant.
 H
          K. PRAKASH v. B.R. SAMPATH KUMAR                       709
                   [M. Y. EQBAL, J.]

       10. While deciding the issue as to whether the agreement A
dated 15.12.2003 was executed by the defendant in favour of
the plaintiff-appellant, the trial court has gone through the
pleading and evidence and discussed the matter in detail. The
trial court found that after the agreement executed between
the parties on 15.12.2003 the defendant-respondent issued B
letter dated 21.1.2004 calling upon the plaintiff to get ready
with the entire balance amount on or before 15.4.2004 and
also mentioned that in default, the agreement dated
15.12.2003 will stand cancelled and the advance amount shall
be forfeited. The trial court further found that the plaintiff had C
paid an amount of Rs. 3,75,000/- to the defendant for the
property in occupation of the plaintiff taken on lease and the
defendant in cross examination had admitted that the plaintiff
occupied the first floor as mortgagee and that the plaintiff has
paid the amount of Rs. 3,75,000/- (exhibit P-3). The trial court  o
further found that the defendant was examined as DW-1 and
he admitted the signature of himself, his wife and signature of
plaintiff. He further admitted in cross examination that he had
read the papers and signed the same. The defendant also
handed over copies of the title deeds and the encumbrance E
certificate to the plaintiff on lease basis and also Exhibit P-1
and P-2, the trial court came to the conclusion that the
defendant entered into an agreement of sale with the plaintiff
for a consideration of Rs. 16, 10,000/- and that the amount of
Rs. 5,45,000/- was paid as an advance towards the sale of F
Jhe said property. Further the defendant (DW-1) admitted the
receipt of the legal notice dated 12.3.2004 (exhibit P-3) but
he did not reply the said notice.
      11. The trial cqurt also discussed the defence taken by
the defendantduring cross examination that the suit property G
has fallen to the share of the defendant and that all his brothers
and sisters are residing separately. The trial court, therefore,
came to the conclusion that there is a valid agreement to sell
the suit property executed by the defendant in favour of the
plaintiff on receipt of the advance consideration.                 H
710         SUPREME COURT REPORTS                  [2014] 13 S.C.R.


A           12. The High Court has taken a very peculiar view that        ..
      the plaintiff-appellant filed the suit which was premature. For
      better appreciation, the relevant portion of para 8 of the
      judgment passed by the High Court is extracted hereinbelow:-
             "lt is not in dispute that the agreement is dated
 B 15.12.2003. Under the agreement, both the parties have
   agreed that the sale deed should be executed within one year
   from that day, that is on or before 15.12.2004. But the suit is
   filed on 9.7.2004, that is within about 7 months from the date
   of the agreement. Absolutely, no reasons are forthcoming as
 C to why the suit was filed prematurely. In the meanwhile, the
   plaintiff approached the Police for enforcement of the contract.
   The same is clear in the matter on record Ex.P.11 dated
   08.2.2004 is the complaint lodged by the plaintiff before the
   Deputy Police Commissioner. In the said complaint, he has
 D clearly stated that though the defendant agreed for selling his
   property on 15.12.2003, the plaintiff has not come forward to
   execute the sale deed and that the plaintiff has been delaying
   the execution of sale deed since four days prior to the filing of
   the complaint. The plaintiff requested the Deputy Police
 E Commissioner to call the defendant and to take action by .
   directing him to execute the sale deed as agreed. He also
   sought for protection by filing the said complaint.
              Ex.P.12 is the complaint dated 3.3.2004 filed by the
 F    plaintiff before the Police Commissioner, Bangalore city. In
      the said complaint also, the plaintiff has alleged that defendant
      is refusing to execute the sale deed in his favour and that
      therefore, the Commissioner should intervene in the manner
      for getting the sale deed executed in favour of the plaintiff.
 G             Ex.P.13 is the complaint dated 11.4.2004 filed by the
      plaintiff before the Police Inspector, Subramanyanagar Police
      Station, Bangalore (subsequently police station). In the said
      complaint, he has stated that defendant and his family
      members have threatened to kill the plaintiff and his family
 H
          K. PRAKASH v. B.R. SAMPATH KUMAR                       711
                   [M. Y. EQBAL, J.]

members and therefore, action should be taken against the4 A
defendant. However, Inspector of Police has issued an
endorsement on 11.3.2004, as per Ex.P.14 to the effect that
dispute between the parties is of civil nature and the
complainant was directed to get his grievances redressed
before the jurisdictional Civil Court. Ex.P.15 is another B
complaint of similar nature. Ex.P.16 is an endorsement issued
by the Police officer to the wife of the complainant intimating
her that the complaint lodged by her on 12.3.2004, is received
and for any grievance, she can approach the
Subramanyanagar Police Station. Further, in Ex.P.17, the c
Inspector of Police has intimated the plaintiff that the defendant
has denied the agreement of sale and that he had signed the
sale agreement under mental pressure. Again by issuing such
an endorsement, the Inspector has directed the plaintiff to get
his grievances redressed before the Civil Court. Cr.P.C.107       o
proceedings were initiated before the Tehsildar, Bangalore,
against the parties as is clear from Ex.P.18. based on the
complaints, two charge sheets were lodged against the
defendant as per Ex. P.19 and 21 ; the same are pending
consideration before the Criminal Court. These facts clearly E
go to show that the· plaintiff has approached the police
repeatedly by making one or the other allegations that too within
the span of 2 to 4 months of the agreement. He has approached
the Commissioner of Police and Deputy Commissioner of
police seeking their interference in the matter for gettin..cJ the F
sale deed executed in his favour."
       13. The High Court further held that in the agreement
(Exhibit P-1 ) the parties have agreed that if the sale deed could
not be executed by the defendant, he will repay a sum of Rs,.
10,90,000/-, According to the High Court, the recital in the G
agree'ment shows that it was not executed by the defendant
with free mind and volition rather he was under pressure while
executing those documents.

                                                                  H
712       SUPREME COURT REPORTS                [2014] 13 S.C.R.


A       14. We have given our thoughtful consideration in the
  matter and perused the pleading and evidence. We are of the
  view that the High Court has not approached the issue in its
  right perspective and has committed serious error of law in
  holding that the agreement was executed by the defendant
B without free mind and volition and under some pressure. The
  agreement was executed on 15.12.2003 wherein it has been
  mentioned that the total consideration amount was 16, 10,000/
  - and out of that part consideration of sum of Rs. 5,45,000/-
  was paid. The said agreement was followed by another letter
c dated 21.1.2004, executed by the respondent, the contents
  whereof are reproduced herein-below:-
                       "21.01.2004
         'That on this 22"d day of January, 2004, I have executed
 D the agreement of sale in favour of Sri K.Prakash, in respect of
   the House bearing No.2558, 11th Main Road,
   Subramanyanagara, Bangalore-560010, to sell the same for
   a total sale consideration of Rs.16, 10,000/- (Rupees Sixteen
   Lakhs Ten thousand only). In all I have received a sum of
 E Rs.5,45,000/- (Rupees Five Lakhs Forty Five Thousand only)
   from K. Prakash and the balance sale consideration to be paid
   on or before 15.04.2004 evening, failing to pay the balance
   sale consideration as per the agreement dated 15.12.2004.
   This Agreement stands cancel. I agree forthe same.
 F        Sd/-                                        Sd/-
          \Sampath Kumar)                         (K.Prakash)
          Vendor                                  (Purchaser)


          Sd/-
 G        (Kanthamani)


          WITNESSES:                           WITNESSES
              Sd/-                                1) Sd/-
 H            Sd/-                                2) Sd/-
              Sd/-                                3) Sd/-"
          K. PRAKASH v. B.R. SAMPATH KUMAR                         -713
                   [M. Y. EQBAL, J.]

      15. Indisputably, remedy for specific performance is an A
equitable remedy. The Court while granting relief for specific
performance exercise discretionary jurisdiction. Section 20
of the Act specifically provides that the court's jurisdiction to
grant decree of specific performance is discretionary but not
arbitrary. Discretion must be exercised in accordance with B
the sound and reasonable judicial principles.
     16. The King's Bench in Rookey's Case [77 ER 209;
(1597) 5 Co.Rep.99] it is said :
      "Discretion is a science, not to act arbitrarily according     c
to men's will and private affection: so the discretion which is
exercised here, is to be governed by rules of law and equity,
which are to oppose, but each, in its turn, to be subservient to
the other. This discretion, in some cases follows the law
implicitly, in others or allays the rigour of it, but in no case does D
it contradict or overturn the grounds or principles thereof, as
has been sometimes ignorantly imputed to thi-s Court. That is
a discretionary power, which neither this nor any other Court,
not even the highest, acting in_ a judicial capacity is by the
constitution entrusted with"
                                                                     E
     The Court of Chancery in Attorney General vs. Wheat
[(1759) 1 Eden 177; 28 ER 652] followed the Rooke's case
and observed :
         "the law is clear and courts of equity ought to follow it in
their judgments concerning titles to equitable estates; otherwise F
great uncertainty and confusion would ensue. And though
proceedings in equity are said to be secundum discretionem
bani vin, yet when it is asked, vir bonus est quis? The answer
is, qui consu/ta partum, qui leges juraq servat. And as it is
said in Rooke's case, 5 Rep. 99 b, that discretion is a science G
not to act arbitrarily according to men's will and private
affection: so the discretion which is exercised here, is to be
governed by rules of law and equity, which are to oppose, but
each, in its turn, to be subservientto the other. This discretion,
                                                                     H
714         SUPREME COURT REPORTS                   [2014] 13 S.C.R. -


A in some cases follows the law implicitly, in others or allays the
  rigour of it, but in no case does it contradict or overturn the
  grounds or principles thereof, as has been sometimes
  ignorantly imputed to this Court. That is a discretionary power,
  which neither this nor any other Court, not even the highest,
B acting in a judicial capacity is by the constitution entrusted with.
  This description is full and judicious, and what ought to be
  imprinted on the mind of every judge."
             17. The principles which can be enunciated is that where
      the plaintiff brings a suit for specific performance of contract
C     for sale, the law insists a condition precedent to the grant of
      decree for specific performance that the plaintiff must show
      his continued readiness and willingness to perform his part of
      the contract in accordance with its terms from the date of
      contract to the date of hearing. Normally, when the trial court
D     exercises its discretion in one way or other after appreciation
      of entire evidence and materials on record, the appellate court
      should not interfere unless it is established that the discretion
      has been exercised perversely, arbitrarily or against judicial
      principles. The appellate court should also not exercise its
E     discretion against the grant of specific performance on
      extraneous considerations or sympathetic considerations. It
      is true, as contemplated under Section 20 of the Specific Relief
      Act, that a party is not entitled to get a decree for specific
      performance merely because it is lawful to do so. Nevertheless
 F    once an agreement to sell is legal and validly proved and further
      requirements for getting such a decree is established then the
      Court has to exercise its discretion in favour of granting relief
      for specific performance.
        18. Mr. Shetty, lastly submitted that grant of decree for
G specific performance in favour of the appellant will cause a
  great hardship for the reason not only because of the lesser
  price shown in the agreement but also because of the rise in
  price which have been increased ten times the price agreed
  between the parties.
 H
         K. PRAKASH v. B.R. SAMPATH KUMAR                          715
                  [M. Y.\EQBAL, J.]

     19. Subsequent rise in price will not be treated as a A
hardship entailing refusal of the decree for specific
performance. Rise in price is a normal change of
circumstances and, therefore, on that ground a decree for
specific performance cannot be reversed.
      20. However, the court may take notice of the fact that B
there has been an increase in the price of the property and
considering the other facts and circumstances of the case,
this Court while granting decree for specific performance can
impose such condition which may to some extent compensate
the defendant-owner of the property. This aspect of the matter C
is considered by a three Judge Bench of this Court in Nirmala
Anand vs. Advent Corporation (P) Ltd. and Others, (2002)
8 SCC 146, where this Court held:-
      "6. It is true that grant of decree of specific performance
                                                                     0
     lies in the discretion of the court and it is also well settled
     that it is not always necessary to grant specific
     performance simply for the reason that it is legal to do
     so. It is further well settled that the court in its discretion
     can impose any reasonable condition including payment E
     of an additional amount by one party to the other while
     granting or refusing decree of specific performance.
     Whether the purchaser shall be directed to pay an
     additional amount to the seller or converse would depend
     upon the facts and circumstances of a case. Ordinarily, F
     the plaintiff is not to be denied the relief of specific
     performance only on account of the phenomenal increase
     of price during the pendency of litigation. That may be, in
     a given case, one of the considerations besides many
     others to be taken into consideration for refusing the G
     decree of specific performance. As a general rule, it
     cannot be held that ordinarily the plaintiff cannot be
     allowed to have, for her alone, the entire benefit of
     phenomenal increase of the value of the property during
     the pendency of the litigation. While balancing the H
716          SUPREME COURT REPORTS                  [2014] 13 S.C.R.


A           equities, one ofthe considerations to be kept in view is
            as to who is the defaulting party. It is also to be borne in
            mind whether a party is trying to take undue advantage
            over the other as also the hardship that may be caused
            to the defendant by directing specific performance. There
B           may be other circumstances on which parties may not
            have any control. The totality of the circumstances is
            required to be seen."
        21. As discussed above the agreement was entered into
  between the parties in 2003 for sale of the property for a total
C consideration of Rs.16, 10,000/-. Ten years have passed by
  and now the price of the property in that area where it situates
  has increased by not less than five times. Keeping in mind
  the factual position we are of the view that the appellant should
  pay a total consideration of Rs.25 lakhs, being the price for
D the said property.
        22. We, therefore, allow this appeal and set aside the
  judgment and order passed by the High Court and restore the
  judgment and decree of the trial court with the modification
E that on payment of Rs.25 lakhs, less already paid by the
  plaintiff, the defendant-owner shall execute a registered sale
  deed within a period of three months from today.




      Bibhuti Bhushan Bose                                Appeal allowed.


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