Holding

After conveyance, the only question is whether the purchaser is a bona fide purchaser for value without notice; the defence of readiness and willingness under Section 16(c) of the Specific Relief Act, 1963 does not apply.

Summary

M.M.S. Investments sued Veerappan and others for specific performance of a sale agreement. After a decree was passed, the defendants sold the disputed land to new purchasers who were impleaded in the appeal. The High Court allowed the impleadment but held that the defence of readiness and willingness under Section 16(c) of the Specific Relief Act, 1963 was not applicable after conveyance, limiting the issue to whether the purchasers were bona fide purchasers for value without notice. The Supreme Court affirmed this view, stating that once a conveyance has occurred, the readiness and willingness defence is irrelevant and the only relevant enquiry is the bona‑fide status of the purchasers. Consequently, the appeal was dismissed.

Issues considered

Whether the defence of readiness and willingness under Section 16(c) of the Specific Relief Act, 1963 can be raised in a specific performance suit after the property has been conveyed.
Whether the purchasers must prove that they are bona fide purchasers for value without notice, rendering the readiness and willingness defence immaterial.

Legislation cited

Specific Relief Act, 1963s. 16(c)

Subjects

specific performancereadiness and willingnessbona fide purchaserSpecific Relief Actconveyanceimpleadmentcivil appeal

Judgment

A M.M.S. INVESTMENTS, MADURAI AND ORS.
v. ~
V. VEERAPPAN AND ORS.

APRIL 11, 2007

B [DR. ARIJIT PASAYA T AND S.H. KAPADIA, JJ.]

Specific Relief Act, 1963: /

s. 16(c)-Suit for specific performance ofcontract-Defence ofreadiness
c and willingness-Suit decreed-Thereafter suit property sold to different
persons and appeal filed-HELD: after conveyance the only question to be
adjudicated is whether purchaser was a bona fide purchaser for value without
notice-The question of readiness and willingness is not relevant-Therefore,
the provision of the Act is not applicable.
D Respondent no. 1 filed an suit for specific performance of agreement
against respondents no.2 to 9. The suit was decreed . However, the defendants-
respondent sold the land which was subject matter of the suit. Defendants 1
to S filed appeal against the judgment and decree in the suit. The Purchasers
filed an application for impleadment as appellants 6 to 9 in the appeal. A
E preliminary objection to defence of readiness and willingness was raised. The
Single Judge observed that there was no bar for the appellants to raise any
issue on merits of the appeal except the defence of readiness and willingness
as provided under s. 16(c) of the Specific Relief Act, 1963. Ultimately, the
impleadment application was allowed by the Division Bench and the appeal
was directed to be decided on merits. Aggrieved, the purchasers filed the
F present appeal.

It was contended for the appellants that the plea relating to readiness
and willingness can be raised in a suit for specific performance of contract;
and that since the purchasers stepped into the suit of the vendors, plea of
readiness and willingness could be pressed into service.
G
Dismissing the appeal, the Court
't
HELD: 1.1. Questioning the plea of readiness and willingness is a
•
concept relatable to an agreement. After conveyance, the only question to be
H 32
M.M.S.INVESTMENTS,MADURA!v. V. VEERAPPAN[PASAYAT,J.) 33
adjudicated is whether the purchaser was a bona fide purchaser for value A
without notice, and the question of readiness and willingness is really not
relevant. Therefore, the provision of the Specific Relief Act 1963 is not
applicable. Once there is a conveyance, the concept would be different and the
primary relief could be only cancellation. [Para 6) (35-B-CJ

Ram Awadh (dead) by Lrs. and Ors. v. Achhaibar Dubey and Anr., B
(2000) 2 sec 428, held inapplicable.

1.2. In the instant case, the purchasers had to prove that they were bona
fide purchasers for value without notice. The readiness and willingness aspect
will not give any relief to them. [Para 8) (35-D-E) C
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 418 of2007.

From the Judgment and Order dated 25.01.2000 of the High Court of
Judicature at Madras in L.P.A. No. 211 of 1999.
D
WITH

C.A. No. 419 of2001.

K.K. Mani and K.B. Sandeep for the Appellants.
E
V. Prabhakar, V. Subramani and Revathy Raghavan for the Respondents.

The Judgment of the Court was delivered by

DR. ARIJITPASAYAT,J. C.A.No. 4180/2001

I. This appeal is directed against the judgment of the Madras High
F
Court. Letters Patent Appeal was filed questioning correctness of the order
passed by a learned Single Judge in A.S.No. 796/1987 dated 2.11.1999. The
order was passed on a preliminary objection raised by the respondents in the
appeal.
G
2. Background facts in a nutshell are as follows:

3. 0.S.No.247of1981 on the file of the Sub Court, Madurai was filed
by Veerappan, the first respondent for specific performance of an agreement
for sale dated 23.1.1978. Respondents 2 to 9 were impleaded in the suit as
owners of the property and it was alleged that the owners had entered into H
an agreement with him and as the agreement was not complied with, the suit
34 SUPREME COURT REPORTS [2007] 5 S.C.R.

A was filed. After the decree was passed by the trial Court, the defendants
through their power of attorney sold large extent of properties including the
subject matter of the suit in favour of certain other persons who are the
present appellants. In the mean time, defendants 1 to 5 filed appeal in A.S.
No. 796 of 1987 before the High Court against the Judgment and decree in
B O.S. No. 247of1981 and the appellants herein being subsequent purchasers
filed C.M.P. 3707 of 1989 to implead themselves as appellants 6 to 9 in the
appeal on the ground that original appellants 1 to 5, the erstwhile owners,
were trying to collude with the first respondent. Appellants 1 to 5 filed C.M.P.
No. 4388 of 1990 to withdraw their power of attorney in favour of one
Chakrapani and Sethuraman. A learned Single Judge of the High Court
C dismissed C.M.P. No. 3707 of 1989 filed by the appellants herein seeking
impleadment and allowed C.M.P. No. 4388of1990 by order dated 28.6.1990.
The appellants filed L.P.A. No. 113 of 1990 against the order of dismissal of
C.M.P. No 3707 of 1989 and also sought for leave to file an appeal against
the order allowing C.M.P. No. 4388 of 1990. Both the L.P.A. and C.M.P.
D No.9570of1990 seeking leave to appeal were disposed of by a common order
dated 28.3.1990. L.P.A. 113 of 1990 was allowed and with the result the
appellants were imp leaded as appellants 6 to 9 in the appeal and A.S. No. 796
of 1987 was also directed to be disposed on merits.

4. The High Court after analyzing the rival submissions came to hold
E as follows:

"Therefore, we are inclined to hold that having regard to the facts
and circumstances of the case, there is no bar for the appellants to
raise any issue on the merits of the appeal for consideration in the
appeal except the defence of readiness and willingness as provided
F under Section 16 (c) of the Specific Relief Act, 1963.

In the result, the appeal is ordered accordingly. No costs.
Consequently, connected C.M.P. is dismissed."

(underlined for emphasis)
G
5. Learned counsel for the appellants submitted that the plea relating to
readiness and willingness can be raised in a suit for specific performance of
contract. Strong reliance is placed on a decision of this Court in Ram Awadh
(dead) by Lrs. And Ors. v. Achhaibar Dubey and Anr., [2000] 2 SCC 428.
H Learned counsel for the appellants, therefore, has submitted that the High
Court was not justified in its view.
M.M.S. INVESTMENTS, MADURAI v. V. VEERAPPAN [PASAYA T, J.) 35

6. Learned counsel for the respondents on the other hand supported the A
judgment of the High Court.

7. Questioning the plea of readiness and willingness is a concept relatable
to an agreement. After conveyance the question of readiness and willingness
is really not relevant. Therefore, the provision of the Specific Relief Act, 1963
(in short the 'Act') is not applicable. It is to be noted that the decision in Ram B
Awadh 's case (supra) relates to a case where there was only an agreement.
After the conveyance, the only question to be adjudicated is whether the
purchaser was a bona fide purchaser for value without notice. In the present
case the only issue that can be adjudicated is whether the appellants were
bona fide purchasers for value without notice. The question whether the C
appellants were ready and willing is really of no consequence. In Ram Awadh 's
case (supra) the question of the effect of a completed sale was not there.
Therefore, that decision cannot have any application so far as the present
case is concerned. Once there is a conveyance the concept would be different
and the primary relief could be only cancellation.
D
8. Learned counsel for the appellants submitted that since the purchasers
step into the shoes of the vendor, the question of readiness and willingness
can be pressed into service. This plea is clearly without substance because
the purchasers had to prove that they are bona fide purchasers for value
without notice. The readiness and willingness aspect will not give any relief
to them. That being the position, the appeal is sans merit and is dismissed. E
There will be no order as to costs.

C.A. No. 419 of 2001

9. In view of the dismissal ofC.A. No. 418 of2001, no order needs to
be passed in this appeal. F

RP. Appeal dismissed.