Holding

The Supreme Court held that where the plaintiff’s pleadings clearly manifest readiness and willingness, the requirements of Section 16(c) of the Specific Relief Act are satisfied, and a second appeal under Section 100 CPC is permissible only on a substantial question of law, leading to the restoration of the lower courts' decree.

Summary

Mst. Sugani entered into an agreement to sell a house to Mahadeo on 13‑12‑1975 for Rs 7,000, paying Rs 5,000 as earnest money. Registration was barred by a prohibition on urban property sales, and Mahadeo later executed a sale deed in favour of Rameshwar Das and Jamuna Prasad. Sugani sued for specific performance on 3‑1‑1979. The trial court and the first appellate court granted the decree, but the Allahabad High Court reversed, holding that the plaint did not satisfy Section 16(c) of the Specific Relief Act and that the legal heirs of the deceased defendant were not joined. The Supreme Court held that the pleadings clearly showed Sugani’s readiness and willingness to perform, satisfying Section 16(c), and that a second appeal under Section 100 CPC can be entertained only on a substantial question of law, not on factual findings. Consequently, the High Court’s order was set aside and the decree of the lower courts restored.

Issues considered

Whether the plaint complied with Section 16(c) of the Specific Relief Act, 1963, i.e., whether the plaintiff demonstrated readiness and willingness to perform his part of the contract.
Whether a second appeal under Section 100 of the Code of Civil Procedure, 1908 is maintainable when the question raised is not a substantial question of law.
Whether the legal heirs of the deceased defendant needed to be joined as parties for the decree to be executable.
Whether the respondents are bona‑fide purchasers for value without notice.
Whether the suit for specific performance was barred by limitation under the Limitation Act, 1963.

Legislation cited

Subjects

Specific performanceSection 16(c)Specific Relief ActSecond appealSection 100 CPCBona fide purchaserLimitation periodSale deedLegal heirsCivil procedure

Judgment

MST. SUGANI A
v.
RAMESHWAR DAS AND ANR.

APRIL 25, 2006

/ [ARIJIT PASA YAT AND TARUN CHATTERJEE, JJ.] B

Specific Relief Act, 1963;

Section 16(c)-Specific performance of contract-Decree for-Held,
the person seeking the relief is mandated to aver in the plaint and establish C
by evidence that he has always been ready and willing to perform his part
of the contract.

Code of Civil Procedure, 1908;

Section JOO-Second Appeal-High Court-Power under- D
Interference-Scope of-Explained.

An agreement to sell was executed between the appellant herein and
defendant No. I in the suit in respect of !he suit property for a sum of Rs.
7,000 on 13.12.1975. Out of the said sum, Rs. 5,000 was paid as earnest money E
on the date of agreement and the balance was payable on the date of the sale.
Registration of the sale could not be done as admittedly there was a prohibition
on sale of urban property at the relevant point of time. Defendant No. 1 executed
a sale deed in favour of respondents 1 & 2 (defendant Nos. 2&3 in the suit)
for a sum of Rs. 6,000 allegedly on the basis of and agreement to sell dated
18.12.1973. On 3.7.1978 a notice was sent by respondent Nos. 1&2 demanding F
arrears of rent from the appellant. On 3.1.1979 appellant filed the suit for
specific performance of the agreement dated 13.12.1975. It was inter alia
indicated that defendant No. 1 put off the registration of the sale deed on one
pretext or other, on 3.7.1978 she came to know that Defendant No. 1 had
executed a sale deed in favour of respondent Nos. 1&2 and, therefore, suit G
was filed oit 3.1.1979. Further the respondent Nos. 1&2 had full knowledge
of agreement to sale executed by Defendant No. 1 in favour of the appellant
and in spite of that respondent Nos. 1&2 got the sale deed executed.

It was specifically stated in the plaint that she was throughout ready
235 H
236 SUPREME COURT REPORTS (2006] SUPP. I S.C.R.

A and willing to get the sale deed executed.
Respondents contended that Defendant No. 1 had not entered into any
agreement to sell the suit property on 13.12.1975. On the other hand, he had
entered into an agreement to sell the property dated 18.12.1973 with
respondents 1&2 which culminated in the sale deed dated 18.4.1977.
B
Several issues were framed by the trail court. Both the trial court and
the First appellant court answered all the issues in favour of the plaintiff. In
the second appeal filed by the present respondents who were the appellants
before the High Court, the High Court held that the pleadings in the plaint do
C not satisfy the requirement of Section I6(c) of the Specific Relief Act, 1963
(in short the 'Act') read with Form Nos, 47 & 48 of Appendix A of the First
Schedule of the CPC. The plaintiff cannot get a decree for specific performance
of the contract as the legal heirs were not brought on record in place of
-
deceased defendant No. 1. High Court had formulated questions for
determination in respect of issues which were not even decided by trial court.
D The trial court and the first appellate court recorded categorical findings that
there was prohibition on the registration of the sale deed at the relevant point
of time and, therefore, only agreement of sale was executed. Interestingly the
High Court found that the decree passed was not executable as defendant No.1
had died and the legal heirs were not brought on record. There was no issue
framed in that regard and even no question of law was formulated in the second
E appeal

Allowing the appeal, the court

HELD: 1.1. The basic principle behind Section 16(c) of the Specific Relief
Act read with Explanation (ii) is that any person seeking benefit of the specific
F performance of contract must manifest that his conduct has been blemishless
throughout entitling him to the specific relief. The provision imposes a
personal bar. The Court is to grant relief on the basis of the conduct of the
person seeking relief. If the pleadings manifest that the conduct of the plaintiff
entitles him to get the relief on perusal of the plaint he should not be denied
G the relief. 1246-DI

Ardeshir H. Mama v. Flora Sassoon, AIR (1928) PC 208; Prem Raj v.
The D.L.F. Housing and Construction (Private) ltd. and Anr., A[R (1968) SC
1355; Surya Narain Upadhyaya v. Ram Roop Pandey and Ors., AIR (1994)
SC 105 and Aniglase Yohannan v. Ramlatha and Ors., 12005] 7 SSC 534,
H referred to.
MST. SUGANI v. RAMESHW AR DAS 237
Syed Dastagir v. T.R. Gopalakrishna Setty, (1999) 6 SSC 337; Moti/al A
Jain v. Ramdasi Devi (Smt.) and Ors., (2006] 6 SSC 420 and Lord Campbell
in Cork v. Ambergate etc. and Railway Co., (1851) 117 ER 1229, relied upon.

2.1. The right of appeal is neither a natural nor an inherent right
attached to the litigation. Being a substantive statutory right, it has to be
regulated in accordance with law in force at the relevant time. The conditions B
mentioned in Section 100 CPC must be strictly fulfilled before a second appeal
can be maintained and no court has the power to add to or enlarge those
grounds. The second appeal cannot be decided on merely equitable grounds.
The concurrent findings of facts howsoever erroneous cannot be disturbed
by High Court in exercise of the powers under this section. The substantial C
question of law has to be distinguished from a substantial question of fact.
[248-B-D]
Sir Chunilal v. Mehta and Sons Ltd v. Century Spg. & Mfg. Co. Ltd.,
(1962], supp 3 SCR 549, relied upon .
•
2.2. It is not within the domain of the High Court to investigate the D
grounds on which the findings were arrived at by the last court of fact. It is
true that the lower appellate court should not ordinarily reject witness accepted
by the trial court in respect of credibility but even where it has rejected the
witnesses accepted by the trial court, the same is no ground for interference
in second appeal, when it is found that the appellate court has given
satisfactory reasons for doing so. In a case where from a given set of E
circumstances two inferences are possible, one drawn by the lower appellate
court is binding on the High Court in second appeal. Adopting any other
approach is not permissible. The High Court cannot substitute its opinion
for the opinion of the first appellate court unless it is found that the
conclusions drawn by the lower appellate court were erroneous being contrary F
to the mandatory provisions of law applicable or its settled position on the
basis of pronouncements made by Apex Court, or was based upon inadmissible
evidence or arrived at without evidence. (248-F-H; 249-A]
2.3. Where a point of law has not been pleaded or is found to be arising
between the parties in the absence of any factual format, a litigant should not G
be allowed to raise that question as a substantial question of law in second
appeal. The mere appreciation of the facts, the documentary evidence or the
meaning of entries and the contents of the document cannot be held to be
raising a substantial question of law. (249-C-D)

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3465 of2000. H
238 SUPREME COURT REPORTS [2006) SUPP. I S.C.R.

A From the Final Judgment and Order dated I. 9.1999 of the High Court of
Allahabad in S.A.No. 2452/1984.
R.B. Mehrotra, Kavin Galati, Ms. Rashmi Singh and Mrs. Nandini Gore
for the Appellant.
H. Sahu and C.L. Sahu for the Respondents.
B
The Judgment of the Court was delivered by
ARIJIT PASAY AT, J. Challenge in this appeal is to the judgment rendered
by a learned Single Judge of the Allahabad High Court allowing a Second

C
Appeal filed under Section 100 of the Code of Civil Procedure, 1908 (in short
the 'CPC' ), by reversing the judgment and decree passed by the trial court
as affirmed by the Appellate Court.
-
The factual background, as projected by the appellant in a nutshell is
as follows:
An agreement to sell was executed between the appellant, herein and
D Mahadeo defendant No. I in the suit (since deceased) in respect of the suit
property for a sum of Rs. 7,000/- on 13. 12. I 975. Out of the said sum Rs.5,000/
- was paid as earnest money on the date of agreement and the balance was
payable on the date of the sale. Registration of the sale could not be done
as admittedly there was a prohibition on sale of urban property at the relevant
E point of time. The agreement to sell was made on 13.12.1975. Defendant No. I
Mahadeo executed a sale deed in favour of respondents 1 & 2 (defendant
Nos. 2&3 in the suit) for a sum of Rs.6,000/- allegedly on the basis of and
agreement to sell dated 13.12. I975. On 3. 7.1978 a notice was sent by respondent
Nos. I & 2 demanding arrears of rent from the appellant. On 3.1. I979 appellant
filed the suit for specific performance of the agreement dated 13. 12. I975. It
F was inter alia indicated that the defendant No. I put off the registration of
the sale deed on one pretext or other, on 3.7.1978 she came to know that
Mahadeo had executed a sale deed in favour of respondent nos. I & 2 and,
therefore, suit was filed on 3.1.1979. Further the respondent nos. I & 2 had
full knowledge of agreement to sale executed by Mahadeo in favour of the
appellant, and in spite of that respondent Nos. I& 2 got the sale deed
G executed. It was specifically stated in the plaint that she was throughout
ready and willing to get the sale deed executed. Written Statement of Mahadeo
and the respondents I & 2 i.e. defendants 2 & 3 was to the fact that Mahadeo ..
had not entered into any agreement to sell the suit property on 13.12. I 975.
On the other hand, Mahadeo had entered into an agreement to sell the
H property dated 18.12. I973 with respondents I & 2 which culminated in the
...
MST. SUGANI v. RAMESHWARDAS [PASAYAT,J.] 239
sale deed dated 18.4.1977. Mahadeo further alleged that the agreement to sell A
was a forged document and it did not bear either the signature or L.T.I. of
Mahadeo and the defendant Nos.2 & 3 i.e. respondents I & 2 herein, had no
knowledge of the agreement to sell purported to have been executed on
13.12.1975. Respondents 1 & 2 further took the stand that the sale deed dated
18.4.1977 was executed by Mahadeo and with the full knowledge of the B
plaintiff appellant who was the tenant. Mahadeo never signed in Hindi and
used to sign in Mahajani.

Following issues were framed by the trial court:

1.(A) Whether defendant No. I Mahadeo executed an agreement deed C
on l 3.12. l 975 for the sale of the house detailed at the foot of the plaint for
Rs.7,000/- in favour of the plaintiff?

(B) Whether defendant Mahadeo accepted Rs.5,000/- as earnest money
on that date and thereafter executed an agreement deed?

2. Whether the sale deed dated J8.4. J977 regarding the disputed house
D
executed by Mahadeo in favour of Ramesh war Das and Jamuna Prasad is null
and void?

3. Whether defendants No. 2& 3 are bonafide purchase for value and
without notice?
E
4A Whether the suit is under valued?

B Whether court fee paid is insufficient?

5. Whether the suit is barred by the principle of mutality?
F
6. Whether the plaintiff is in possession of the disputed house as a
tenant or in part performance of the said agreement deed?

7. To what relief if any is the plaintiff entitled?

Both the trial court and the First appellant court answered all the G
questions in. favour of the plaintiff.

In the second appeal following questions were raised by the present
respondents who were the appellants before the High Court:

I. Whether there was no evidence to suggest that the thumb H
240 SUPREME COURT REPORTS [2006] SUPP. I S.C.R.

A impressions on the agreement relied upon by the plaintiff was
that of Mahadeo?
2. Whether the suit was barred by time?
3. Whether the appellants are the bonajide purchasers for value
without notice?
B
4. Whether the sale deed was validly executed by Mahadeo in
favour of the appellant?

The High Court held that the pleadings in the plaint do not satisfy the
requirement of Section 16 (c) of the Specific Relief Act, 1963 (in short the
C 'Act') read with Form Nos. 47 & 48 of the Appendix A of the First Schedule
of the CPC. It was held that the defendant~ 2 & 3 were bonafide purchasers
for value without notice. The reasons given by the courts below to hold that
the defendant Nos. 2 & 3 had knowledge of the plaintiffs agreement were
imaginary reasons and they were not acceptable. The plaintiff cannot get a
decree for specific performance of the contract as the legal heirs were not
D brought on record in place of deceased defendant No. I. The trial court while
dealing with issue No. 7 as noted above recorded as follows:

"In issue Nos. I and 2 the plaintiff has corroborated her statement
that she want to get the sale deed executed in her favour by all the

E
defendants. The defendant No. l Mahadeo had died having no ..
successor and on this basis no sale deed can be executed by him. So
far as the defendants No. 2 and 3 are concerned, the sale deed
executed by Mahadeo was found null of void. Hence they also can
not execute sale deed. In such circumstances after receiving remaining
Rs. 2000 only Court can order to execute the sale deed."
F
The above conclusions of the trial court as affirmed by the first appellate
court have not been considered by the High Court, and the appeal was
accordingly allowed.

Learned counsel for the appellant submitted that in the plaint specific
G averments were made about the readiness and willingness. Answering issue
No.6 the trial court had noted that the execution of the alleged agreement
dated 18.12.1973 was not proved. The defendant no.I had categorically
admitted about the ban on registration. In the written statement Mahadeo,
defendant no. I also admitted about the ban and had at paragraph 6 stated
about the sale deed dated 19. 7. 1977. The first appellate court noted that there
H
MST. SUGANI v. RAMESHWARDAS [PASAYAT, J.] 24 l
was no dispute that during the concerned period there was prohibition on A
re~istration of sale deed. As there was a prohibition on registration, the
agreement to sale was executed. The High Court came to hold that the suit
was barred by time, in answering the question No. 3 formulated by it. It is
to be noticed that no such issue was framed in the suit. In any event, bare
perusal of Article 54 of the Limitation Act, 1963 (in short 'the Limitation Act')
shows that the suit was within time. There was no issue framed regarding B
readiness and willingness in terms of Section 16(c) of the Act. In any event
in the plaint categorical statements were made and evidence was also
specifically led in this regard. The High Court came to hold that the decree
was not executable even if granted as defendant No. I had died and no legal
representative was brought on record. The findings of fact recorded by the C
trial court as endorsed by the First appellate court the defendant Nos. 2 &
3 were not bonafide purchasers were set aside by the High Court in a Second
Appeal which is clearly impermissible. The trial court and first appellate Court
clearly recorded a finding about collusion which has been set aside without
any material.
D
In reply it was stated by learned counsel for the respondents that the
conclusions of the trial court and the first appellate court were clearly erroneous
and, therefore, the High Court rightly interfered in the matter.

It has to be seen that the High Court had formulated questions for
determination in respect of issues which were not even decided by the trial E
court. No issue as to whether the suit was barred by time was framed by the
trial court. Even otherwise in terms of Article 54 the starting point of limitation
is three years from the date when a date is fixed and in the instance case no
date was fixed and on the contrary the execution of the agreement was denied.
The High Court proceeded as if the period of limitation started from the
alleged date of agreement dated 3.12.1975. The notice about execution of Sale F
deed in favour of defendant Nos. 2 and 3 was received in July, 1978 and the
suit was filed on 3.1.1979. Article 54 reads as follows:
Description of suit Period of Limitation Time from which
period begins to run
G
For specific Three years The date fixed for
performance of a the performance,
contract or, if no such date is
. fixed, when the plaintifl
has notice thatthe
performance is refused H
242 SUPREME COURT REPORTS [2006] SUPP. I S.C.R.

A Therefore, the suit was clearly within time.

Further no issue was framed as regards the alleged non-fulfillment of
the requirement of Section 16 (c) of the Act. Strangely the High Court upset
the factual findings recorded by the trial court and the first appellate Court
B holding that the requirements of Section 16(c) of the Act were not fulfilled.

Section 16(c) needs to be quoted along with the Explanations. The same

c
reads as follows:

"16. Personal bars to relief

(a)
-
(b)

(c) who fails to aver and prove that he has performed or has always
been ready and willing to perform the essential terms of the
D contract which are to be performed by him, other than terms of
the performance of which has been prevented or waived by the
defendant.

Explanation- For the purpose of clause (c)-

(i) where a contract involves the payment of money, it is not essential
E for the plaintiff to actually tender to the defendant or to deposit
in Court any money except when so directed by the Court;
(ii) the plaintiff must aver performance of, or readiness and
willingness to perform, the contract accordingly to its true
construction."
F
In Ardeshir H. Mama v. Flora Sassoon, AIR (1928) PC 208, 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 and as discharged from the obligations. No further performance
by him was either contemplated or had to be tendered. In a suit for specific
G 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, and if the
fact was traversed, he was required to prove a continuous readiness and
willingness from the date of the contract to the time of the hearing, to perform
the contract on his part. Failure to make good that averment brings with it
H and leads to the inevitable dismissal of the suit. The observations were cited
MST. SU GANI v. RAMESHWARDAS [PASA YAT, J.) 243

with approval in Prem Raj v. The D.l.F. Housing and Construction (Private) A
ltd. and Anr., AIR (1968) SC 1355.

The requirements to be fulfilled for bringing in compliance with Section
16(c) of the Act have been delineated by this Court in several judgments.
Before dealing with the various judgments it is necessary to set out the
factual position. The agreement for sale was executed on 15.2.1978 and the B
period during which the sale was to be completed was indicated to be six
months. Undisputedly, immediately after the expiry of the six months period
lawyer's notice was given calling upon the present appellant to execute the
sale deed. It is also averred in the plaint that the plaintiff met the defendant
several times and requested him to execute the sale deed. On finding inaction C
in his part, the suit was filed in September, 1978. This factual position has
been highlighted in the plaint itself. Learned Single Judge after noticing the
factual position as reflected in the averments in the plaint came to hold that
the plaint contains essential facts which lead to inference to plaintiffs readiness
and willingness. Para 3 of the plaint indicates that the plaintiff was always
ready to get the sale deed prepared after paying necessary consideration. In D
para 4 of the plaint reference has been made to the lawyer's notice calling
upon the defendant to execute the sale deed. In the said paragraph it has also
been described as to how after the lawyer's notice was issued plaintiff met
the defendant. In para 5 it is averred that defendant is bound to execute the
sale deed on receiving the balance amount and the plaintiff was entitled to E
get the document executed by the defendant. It is also not in dispute that the
balance amount of the agreed consideration was deposited in Court
simultaneously to the filing of the suit. While examining the requirement of
Section 16(c) this Court in Syed Dastagir v. T.R. Gopalakrishna Settty, [1999]
6 sec 337 noted as follows:
F
"So the whole gamut of the issue raised is, how to construe a plea
specially with reference to Section 16(c) and what are the obligations
which the plaintiff has to comply with in reference to his plea and
whether the plea of the plaintiff could not be construed to conform
to the requirement of the aforesaid section, or does this section
require specific words to be pleaded that he h~s performed or has G
always been ready and is willing to perform hi& part of the contract.
In construing a plea in any pleading, courts m'.ust keep in mind that
a plea is not an expression of art and science but an expression
through words to place fact and law of one's case for a relief. Such
an expression may be pointed, precise, sometimes vague but still it H
/
244 SUPREME COURT REPORTS (2006] SUPP. I S.C.R.

A could be gathered what he wants to convey through only by reading
the whole pleading, depending on the person drafting a plea. In India
most of the pleas are drafted by counsel hence the aforesaid difference
of pleas which inevitably differ from one to the other. Thus, to gather
true spirit behind a plea it should be read as a whole. This does not
distract one from performing his obligations as required under a statute.
B But to test whether he has performed his obligations, one has to see
the pith and substance of a plea. Where a statute requires any fact
to be pleaded then that has to be pleaded may be in any form. The
same plea may be stated by different persons through different words;
then how could it be constricted to be only in any particular
c nomenclature or word. Unless a statute specifically requires a plea to
be in any particular form, it can be in any form. No specific phraseology
or language is required to take such a plea. The language in Section
16(c) does not require any specific phraseology but only that the
plaintiff must aver that he has performed or has always been and is
willing to perform his part of the contract. So the compliance of
D "readiness and willingness" has to be in spirit and substance and not
in letter and form. So to insist for a mechanical production of the exact
words of a statute is to insist for the form rather than the essence.
So the absence of form cannot dissolve an essence if already pleaded."

E Again in Motila/ Jain v. Ramdasi Devi (Smt.) and Ors., [2000] 6 SCC
420 it was noted as follows:

The other contention which found favour with the High Court, is
that plaint averments do not show that the plaintiff was ready and
willing to perform his part of the contract and at any rate there is no
p evidence on record to prove it. Mr. Choudhary developed that
contention placing reliance on the decision in Varghese case [ 1969]
2 SCC 539. In that case, the plaintiff pleaded an oral contract for sale
of the suit property. The defendant denied the alleged oral agreement
and pleaded a different agreement in regard to which the plaintiff
neither amended his plaint nor filed subsequent pleading and it was
G in that context that this Court pointed out that the pleading in specific
performance should conform to Forms 47 and 48 of the First Schedule
of the Code of Civil Procedure. That view was followed in Abdul
Khader case [1989] 4 SCC 313.

However, a different note was struck by thb Court in Chandiok case
H
MST. SUGANI v. RAMESHWARDAS [PASA YAT,J.] 245
(1970] 3 sec 140. In that case 'A' agreed to purchase from 'R' a A
leasehold plot. 'R' was not having lease of the land in his favour from
the Government nor was he in possession of the same. 'R', however,
received earnest money pursuant to the agreement for sale which
provided that the balance of consideration would be paid within a
month at the time of the execution of the registered sale deed. Under B
the agreement 'R' was under obligation to obtain permission and
sanction from the Government before the transfer of leasehold plot.
'R' did not take any steps to apply for the sanction from the
Government. 'A' filed the suit for specific performance of the contract
for sale. One of the contentions of'R' was that 'A' was not ready and
willing to perform his part of the contract. This Court observed that C
readiness and willingness could not be treated as a straitjacket formula
and that had to be determined from the entirety of facts and
circumstances relevant to the intention and conduct of the party
concerned. It was held that in the absence of any material to show
that 'A' at any stage was not ready and willing to perform his part
of the contract or that he did not have the necessary funds for D
payment when the sale deed would be executed after the sanction was
obtained, 'A' was entitled to a decree for specific performance of
contract.

That decision was relied upon by a three-Judge Bench of this Court E
in Syed Dastagir case (1999] 6 SCC 337 wherein it was held that in
construing a plea in any pleading, courts must keep in mind that a
plea is not an expression of art and science but an expression through
words to place fact and law of one's case for a relief. It is pointed out
that in India most of the pleas are drafted by counsel and hence they
inevitably differ from one to the other; thus, to gather the true spirit F
behind a plea it should be read as a whole and to test whether the
plaintiff has performed his obligations, one has to see the pith and
substance of the plea. It was observed:

"Unless a statute specifically requires a plea to be in any particular
form, it can be in any form. No specific phraseology or language G
is required to take such a plea. The language in Section 16(c) of
the Specific Relief Act, 1963 does not require any specific
phraseology but only that the plaintiff must aver that he has
performed or has always been and is willing to perform his part
of the contract. So the compliance of 'readiness and willingness'
has to be in spirit and substance and not in letter and form." H
246 SUPREME COURT REPORTS [2006] SUPP. I S.C.R.

A It is thus clear that an avennent of readiness and willingness in the
plaint is not a mathematical formula which should only be in specific
words. If the avennents in the plaint as a whole do clearly indicate the
readiness and willingness of the plaintiff to fulfil his part of the
obligations under the contract which is the subject-matter of the suit,
the fact that they are differently worded will not militate against the
B readiness and willingness of the plaintiff in a suit for specific
performance of contract for sale."

Lord Campbell in Cork v. Ambergate etc. and Railway Co., (1851) 117
ER 1229 observed that in common sense the meaning of such an averment
C of readiness and willingness must be that the non-completion of the contract
was not the fault of the plaintiffs, and that they were disposed and able to
complete it had it not been renounced by the defendant.

The basic principle behind Section 16(c) read with Explanation (ii) is that
any person seeking benefit of the specific perfonnance of contract must
D manifest that his conduct has been blemishless throughout entitling him to
the specific relief. The provision imposes a personal bar. The Court is to grant
relief on the basis of the conduct of the person seeking relief. If the pleadings
manifest that the conduct of the plaintiff entitles him to get the relief on
perusal of the plaint he should not be denied the relief.

E Section 16(c) of the Act mandates the plaintiff to aver in the plaint and
establish as the fact by evidence aliunde that he has always been ready and
willing to perfonn his part of the contract. On considering almost identical fact
situation it was held by this Court in Surya Narain Upadhyaya v. Ram Roop
Pandey and Ors., AIR (1994) SC 105 that the plaintiff had substantiated his
F plea.

These aspects were highlighted in Aniglase Yohannan v. Ramlatha and
Ors., (2005] 7 SCC 534.

The trial court and the first appellate court recorded categorical findings
G that there was prohibition on the registration of the sale deed at the relevant
point of time and, therefore, only agreement of sale was executed. Interestingly
the High Court found that the decree passed was not executable as the
defendant No. I had died and the legal heirs were not brought on record.
There was no issue framed in that regard and even no question of law was
fonnulated in the second appeal. The trial court and the first appellate court
H recorded findings of fact that there was collusion between defendant No. I
MST. SUGANI v. RAMESHWAR DAS [PASAYAT, J.] 24 7
and defendant Nos. 2 & 3. That being so factual findings were recorded that A
the defendant Nos. 2 & 3 had knowledge about the agreement with the
plaintiff.

The first appellate court in great detail examined the question as to
whether the defendants 2 & 3 had knowledge. It was noted that a plea that
there was part payment by defendants 2 & 3 were clearly contrary to the B
evidence of defendant No. I. Scope of interference with factual findings is
rather limited. Unless the factual finding is perverse, contrary to material on
record, there is practically no scope for interference.

Despite amendment by the amending Act 104 of I 976, Section I 00 CPC
appears to have been liberally construed and generously applied by some C
Judges of various High Courts with the result that the drastic changes made
in the law and the object behind that appears to have been frustrated. The
amending Act was introduced on the basis of various Law Commission
Reports recommending for making appropriate provisions in the CPC which
were intended to minimise the litigation, to give the litigant fair trial in D
accordance with the accepted principles of natural justice, to expedite the
disposal of civil suits and proceedings so that justice is not delayed, to avoid
complicated procedure, to ensure fair deal to the poor sections of the
community and restrict the second appeals only on such questions which are
certified by the courts to be substantial questions of law.
E
After the amendment a second appeal can be filed only if a substantial
question of law is involved in the case. The memorandum of appeal must
precisely state the substantial question of law involved and the High Court
is obliged to satisfy itself regarding the existence of such a question. If
satisfied, the High Court has to formulate the substantial question of law F
involved in the case. The appeal is required to be heard on the question so
formulated. However, the respondent at the time of the hearing of the appeal
has a right to argue that the case in the court did not involve any substantial
question of law. The proviso to the section acknowledges the powers of the
High Court to hear the appeal on a substantial point of law, though not
formulated by it with the object of ensuring that no injustice in done to the G
litigant where such a question was not formulated at the time of admission
either by mistake or by inadvertence.

It has been noticed time and again that without insisting for the statement
of such a substantial question of law in the memorandum of appeal and
formulating the same at the time of admission, the High Courts have been H
248 SUPREME COURT REPORTS [2006) SUPP. I S.C.R.

A issuing notices and generally deciding the second appeals without adhering
to the procedure prescribed under Section 100 CPC. It has further been found
in a number of cases that no efforts are made to distinguish between a
question of law and a substantial question of law. In exercise of the powers
under this section the findings of fact of the first appellate court are found
to have been disturbed. It has to be kept in mind that the right of appeal is
B neither a natural nor an inherent right attached to the litigation. Being a
substantive statutory right, it has to be regulated in accordance with law in
force at the relevant time. The conditions mentioned in the section must be
strictly fulfilled before a second appeal can be maintained and no court has
the power to add to or enlarge those grounds. The second appeal cannot be
C decided on merely equitable grounds. The concurrent findings of facts
howsoever erroneous cannot be disturbed by the High Court in exercise of
the powers under this section. The substantial question of law has to be
distinguished from a substantial question of fact. This Court in Sir Chunilal
v. Mehta and Sons Ltd v. Century Spg. & Mfg. Co. Ltd., [1962] Supp 3 SCR
549 held that :
D
"The proper test for determining whether a question of law raised in
the case in substantial would, in our opinion, be whether it is of
general public importance or whether it directly and substantially
affects the rights of the parties and if so whether it is either an open
question in the sense that it is not finally settled by this Court or by
E the Privy Council or by the Federal Court or is not free from difficulty
or calls for discussion of alternative views. If the question is settled
by the highest court or the general principles to be applied in
determining the question are well settled and there is a mere question
of applying those principles or that the plea raised is palpably absurd
F the question would not be a substantial question of law."

It is not within the domain of the High Court to investigate the grounds
on which the findings were arrived at, by the last court of fact. It is true that
the lower appellate court should not ordinarily reject witness accepted by the
trial court in respect of credibility but even where it has rejected the witnesses
G accepted by the trial court, the same is no ground for interference in second
appeal, when it is found that the appellate court has given satisfactory
reasons for doing so. In a case where from a given set of circumstances two
inferences are possible. One drawn by the lower appellate court is binding on
the High Court in second appeal. Adopting any other approach is not
H permissible. The High Court cannot substitute its opinion for the opinion of
MST. SUGAN!v. RAMESHWARDAS[PASAYAT,J.) 249

the first appellate court unless it is found that the conclusions drawn by the A
lower appellate court were erroneous being contrary to the mandatory
provisions of law applicable or its settled position on the basis of
pronouncements made by the Apex Court, or was based upon inadmissible
evidence or arrived at without evidence.

If the question of law termed as a substantial question stands already B
decided by a larger Bench of the High Court concerned or by the Privy
Council or by the Federal Court or by the Supreme Court, its merely wrong
application on the facts of the case would not be termed to be a substantial
question of law. Where a point of law has not been pleaded or is found to
be arising between the parties in the absence of any factual format, a litigant C
should not be allowed to raise that question as a substantial question of law
in second appeal. The mere appreciation of the facts, the documentary evidence
or the meaning of entries and the contents of the document cannot be held
to be raising a substantial question of law. But where it is found that the first
appellate court has assumed jurisdiction which did not vest in it, the same
can be adjudicated in the second appeal, treating it as a substantial question D
of law. Where the first appellate court is shown to have exercised its discretion
in a judicial manner, it cannot be termed to be an error either of law or of
procedure requiring interference in second appeal. This Court in Reserve
Bank of India v. Ramkrishna Govind Morey, [1976] I SCC 803 held that
whether the trial court should not have exercised its jurisdiction differently E
is not a question of law justifying interference.

The above position was noted in Kondiba Dagadu Kadam v. Savitribai
Sopan Gujar & Ors., [1999] 3 SCC 722.

Looked at from any angle the impugned order of the High Court is F
indefensible and is set aside. The appeal is allowed. The judgment and the
decree of the trial court as affirmed by the first appellate court stand restored.
No Costs.

B.K. Appeal allowed.