Supreme Court of India
URMILA DEVI AND OTHERSversusTHE DEITY, MANDIR SHREE CHAMUNDA DEVI, THROUGH TEMPLE COMMISSIONER AND OTHERS
- Citation
- 2018 INSC 16
- Decided
- 10 January 2018
- Disposal
- Case Partly allowed
- Bench
- A K SIKRI
Holding
Under Section 21 of the Specific Relief Act, compensation may be awarded in lieu of specific performance, and the acquisition compensation must be paid to the plaintiff as the gift deed was void.
Summary
The appellants (legal heirs of Krishan Lal) had purchased a 5/16 share of land from respondents 2‑6 for Rs 90,000, took possession and built three shops. Respondents 2‑6 later executed a gift deed in favour of respondent 1 (defendant 6), which the trial court declared void and granted specific performance to the appellants. While the appeal was pending, the land was acquired under the Land Acquisition Act and compensation of Rs 10,03,743 was awarded to respondent 6, whose name was on the revenue records. The High Court held that the specific‑performance decree could not be enforced due to acquisition and modified it to order a refund of Rs 90,000 with interest to the appellants. The Supreme Court examined Section 21 of the Specific Relief Act and held that when performance becomes impossible through no fault of the plaintiff, the court may award compensation in lieu of specific performance. Since the gift deed was void, respondent 6 had no right to the acquisition compensation; therefore, Rs 10 lakh of the compensation is to be awarded to the appellants, with the balance payable to respondents 2‑5. The appeal was partly allowed and the High Court decree was modified accordingly.
Issues considered
- What relief is appropriate when a decree for specific performance becomes impossible due to compulsory land acquisition?
- Whether compensation awarded to the person recorded as landowner under the Land Acquisition Act can be redirected to the plaintiff under Section 21 of the Specific Relief Act.
Legislation cited
Subjects
specific performancecompensationSection 21land acquisitionvoid gift deedequitable reliefcontract breach
Judgment
[2018] 1 S.C.R. 797 797
URMILA DEVI AND OTHERS A
v.
THE DEITY, MANDIR SHREE CHAMUNDA DEVI, THROUGH
TEMPLE COMMISSIONER AND OTHERS
(Civil Appeal No. 462 of 2018) B
JANUARY 10, 2018
[A. K. SIKRI AND ASHOK BHUSHAN, JJ.]
Specific Relief Act, 1963: s.21 – Compensation in certain
cases – Respondent no.2 to 6 (defendant no 1 to 5) agreed to sell
C
land to predecessor-in-interest of appellants who paid full
consideration and took possession of land and constructed three
shops on the suit land – Respondent no.2 to 6 gifted same land to
defendant no.6-respondent no.1 – Aggrieved with the non-execution
of sale deed and with gift deed in favour of respondent no.1,
predecessor-in-interest of appellants filed suit for specific D
performance – Trial court declared gift deed in respect of suit land
as null and void and decreed the suit – First appellate court upheld
the judgment of trial court – During pendency of appeal before
High Court, notification under s.4 Land Acquisition Act was issued
and award passed for the suit land and three shops constructed
E
thereon in favour of defendant no.6 – High Court accepted the
plea of defendant no.6 that the land was acquired during the
pendency of appeal and, therefore, decree for specific performance
was not maintainable and modified the decree by ordering
respondent no.2 to 6 to pay full consideration amount to appellant
with interest – On appeal, held: s.21 empowers the Court to award F
compensation in certain cases – The name of defendant No.6 being
recorded in the Revenue records, compensation was determined in
its favour to the extent of amount of Rs.10,03,743/- – In view of the
judgment of courts below whereby the gift deed was declared void,
defendant No.6 had no right in the suit land and was clearly not
G
entitled to receive any amount consequent to the acquisition of the
suit land – Therefore, in the ends of justice, compensation of Rs.10
lakh is awarded in favour of the appellants out of the compensation
received consequent to the acquisition of the suit land – The rest
of the compensation, if any, received towards land and shops to be
paid to the land owner that is respondent Nos.2 to 6). H
797
798 SUPREME COURT REPORTS [2018] 1 S.C.R.
A Partly allowing the appeal, the Court
HELD: 1.1 The suit land was acquired and compensation
was determined in favour of defendant No.6 whose name was
recorded in the Revenue records. No objection can be taken to
the view of the High Court that consequent of the acquisition of
B suit land under the land acquisition proceedings decree of specific
performance granted in favour of plaintiff could not have been
maintained. The limited question is as to what relief the (plaintiff)
appellants were entitled in the event the decree of specific
performance was required to be modified by an alternate decree.
[Paras 9, 10] [801-E-G]
C
2. Section 21 of the Specific Relief Act empowers the Court
to award compensation in certain cases. The name of defendant
No.6 being recorded in the Revenue records, compensation was
determined in its favour. The compensation was determined to
the extent of amount of Rs.10,03,743/-. In view of the judgment
D and decree of courts below whereby the gift deed was declared
void, defendant No.6 is left with no right in the suit land and is
clearly not entitled to receive any amount consequent to the
acquisition of the suit land. In view of overall facts of the present
case, ends of justice is served in awarding compensation of Rs.10
E lakh in favour of the plaintiff-appellants out of the compensation
received consequent to the acquisition of the suit land. The rest
of the compensation, if any, received towards land and shops in
question has to be paid to the land owner that is defendant Nos.1
to 5 (respondent Nos.2 to 6 to this appeal) after deducting an
amount of Rs.10 lakh out of the said compensation. In event
F compensation has not yet been disbursed, the compensation be
disbursed in the above manner. [Paras 11, 15, 16] [801-G; 804-
F-G; 805-A-D]
Jagdish Singh v. Nathu Singh (1992) 1 SCC 647 : [1991]
2 Suppl. SCR 567 ; Kanshi Ram v. Om Prakash Jawal
G and others (1996) 4 SCC 593 : [1996] 1 Suppl. SCR
330 – relied on
Case LawReference
[1991] 2 Suppl. SCR 567 relied on Para 12
H [1996] 1 Suppl. SCR 330 relied on Para 14
URMILA DEVI v. THE DEITY, MANDIR SHREE CHAMUNDA 799
DEVI, THR. TEMPLE COMMISSIONER
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 462 of A
2018.
From the Judgment and Order dated 02.11.2012 in R. S. A. No.
117 of 2002 and Final Order Dated 20.05.2013 in Review Petition No.
02/2013 in R. S. A. No. 117 of 2002 of the High Court of Himachal
Pradesh at Shimla. B
Rajesh Gupta, Harpreet Singh, Puneet Taneja, Advs. for the
Appellant.
Devvrat, Sanjay Sarin, Gagan Deep Kaur, Rohin Oza, Ms. Siya
Minocha, Dinkar Kalra, Advs. for the Respondent.
C
The Judgment of the Court was delivered by
ASHOK BHUSHAN, J. 1. Leave granted.
2. This appeal has been filed by the plaintiff through legal heirs
questioning the judgment of the High Court of Himachal Pradesh in
Regular Second Appeal No.117 of 2002 which appeal was filed by D
respondent No.1 (defendant No.6 in the suit). The High Court by the
impugned judgment has modified the decree of specific performance of
contract granted by two courts below into a decree ordering respondent
Nos.2 to 6 to pay a sum of Rs.90,000/- with interest @ 9% per annum
from the date of filing of the suit.
E
3. The brief facts of the case which are necessary to notice for
deciding the appeal are:
Respondent Nos.2 to 6 executed an agreement to sell dated
19.04.1989 in favour of of Krishan Lal, the predecessor-in-interest of
the appellants for sale of their 5/16th share in Khasra Nos.430 and 431 F
equal to 0-22-57 hectares for consideration of Rs.90,000/-. Respondent
Nos.2 to 6 received full consideration of Rs.90,000/- and handed over
possession to the plaintiff. The plaintiff after getting possession
constructed three shops in the suit land. Respondent Nos.2 to 6 executed
a gift deed in favour of respondent No.1 of the suit land on 08.07.1991.
When in spite of respondents having received the entire sale consideration G
the sale deed was not executed and with mala fide intention the gift
deed was executed in favour of respondent No.1. Civil Suit No.148 of
1991 was filed by Krishan Lal. Written statements were filed by defendant
Nos.1 to 5 jointly and separate written statement was filed by defendant
No.6 who is respondent No.1 in the present appeal. It was admitted to H
800 SUPREME COURT REPORTS [2018] 1 S.C.R.
A all defendants that the suit land has been gifted in favour of defendant
No.6 by gift deed dated 08.07.1991. The execution of agreement to sell
was not disputed and the receipt of total sale consideration was also not
denied. The trial court decreed the suit vide its judgment and order dated
31.03.1999. The trial court declared that gift deed executed by defendant
Nos.1 to 5 in favour of defendant No.6 is null and void to the extent they
B
relate to the doner’s 5/16th share in the suit land that was agreed to be
sold by them to the plaintiff, decree of specific performance was granted
in favour of the plaintiff against defendant Nos.1 to 5. The appeal was
filed by defendant No.6 only against the judgment of the trial court which
was also dismissed by the First Appellate Court vide its judgment dated
C 17.12.2001. Defendant No.6 filed Regular Second Appeal in the High
Court being RSA No.117 of 2002. During pendency of the second appeal
in the High Court notification under Section 4 of the Land Acquisition
Act dated 22.12.2005 was issued for acquisition of suit land. An award
dated 10.06.2008 was also given for the land as well as three shops
which were constructed in the suit land. The name of defendant No.6
D
being recorded in the Revenue records compensation was awarded in
favour of defendant No.6.
4. Before the High Court a submission was raised on behalf of
defendant No.6 that the land has been acquired during the pendency of
Regular Second Appeal, the decree of the specific performance cannot
E be maintained. The High Court agreeing with the submission of defendant
No.6 modified the decree by ordering respondent Nos.2 to 6 to pay a
sum of Rs.90,000/- to the plaintiff with interest @ 9% per annum from
the date of filing of the suit. The plaintiff through legal heirs aggrieved
by the said judgment has come up in this appeal.
F 5. Learned counsel for the appellants in support of the appeal
contends that the High Court erred in law in ordering the refund of
Rs.90,000/- in favour of plaintiff whereas the plaintiff(appellants) was
entitled to receive the amount of compensation of land which was received
by defendant No.6 consequent to the acquisition of land. Defendant
G No.6 had no right in the land in dispute as the gift deed had been declared
null and void. It was the plaintiff (appellants) who was entitled to receive
the compensation. The High Court having not interfered with the finding
of the courts below that gift deed was void as well as plaintiff was
entitled for decree of specific performance of the contract, it was plaintiff
(appellants) who was entitled to receive compensation consequent to
H the acquisition of the suit land.
URMILA DEVI v. THE DEITY, MANDIR SHREE CHAMUNDA 801
DEVI, THR. TEMPLE COMMNR [ASHOK BHUSHAN, J.]
6. Learned counsel appearing for respondent Nos.2 to 6 supports A
the judgment and decree of the High Court and he, however, does not
dispute that judgment and decree of the Courts below declaring the gift
deed dated 08.07.1991 as void having not been interfered with, the
defendant No.6 has no right in the suit land. Learned counsel for
respondent Nos.2 to 6, however, submits that compensation determined
B
consequent to the land acquisition be appropriated equally between the
plaintiff as well as defendant Nos.1 to 5.
7. No one has appeared on behalf of respondent No.1 (defendant
No.6).
8. We have considered the submissions of the parties and perused C
the records.
9. From the facts and material on record, it is undisputed that
agreement to sell was executed by defendant Nos.1 t 5 in favour of the
plaintiff and entire sale consideration of Rs.90,000/- was received and
possession was delivered in the year 1989 itself. Plaintiff constructed D
three shops on the suit land. Plaintiff’s case that to defeat the rights of
the plaintiff a gift deed dated 08.07.1991 was executed by defendant
Nos.1 to 5 in favour of defendant No.6 has been accepted by courts
below which have declared the gift deed as null and void. The decree
for specific performance was granted by the trial court, it was confirmed
by the First Appellate Court. The suit land was acquired and E
compensation was determined in favour of defendant No.6 whose name
was recorded in the Revenue records. No objection can be taken to the
view of the High Court that consequent of the acquisition of suit land
under the land acquisition proceedings decree of specific performance
granted in favour of plaintiff could not have been maintained. F
10.The limited question which needs to be answered in the present
appeal is as to what relief the (plaintiff)appellants were entitled in the
event the decree of specific performance was required to be modified
by an alternate decree.
11. Section 21 of the Specific Relief Act empowers the Court to G
award compensation in certain cases. Section 21 of the Specific Relief
Act is as follows:
“21. Power to award compensation in certain cases.—
(1) In a suit for specific performance of a contract, the
H
802 SUPREME COURT REPORTS [2018] 1 S.C.R.
A plaintiff may also claim compensation for its breach, either
in addition to, or in substitution of, such performance.
(2) If, in any such suit, the court decides that specific
performance ought not to be granted, but that there is a
contract between the parties which has been broken by the
B defendant, and that the plaintiff is entitled to compensation
for that breach, it shall award him such compensation
accordingly.
(3) If, in any such suit, the court decides that specific
performance ought to be granted, but that it is not sufficient
to satisfy the justice of the case, and that some compensation
C for breach of the contract should also be made to the plaintiff,
it shall award him such compensation accordingly.
(4) In determining the amount of any compensation awarded
under this section, the court shall be guided by the principles
specified in section 73 of the Indian Contract Act, 1872 (9
D of 1872).
(5) No compensation shall be awarded under this section
unless the plaintiff has claimed such compensation in his
plaint:
Provided that where the plaintiff has not claimed any
E such compensation in the plaint, the court shall, at any stage
of the proceeding, allow him to amend the plaint on such
terms as may be just, for including a claim for such
compensation.
Explanation.—The circumstances that the contract has
F become incapable of specific performance does not preclude
the court from exercising the jurisdiction conferred by this
section.”
12.This Court had occasion to consider Section 21 of the Specific
Relief Act in context of a case which arose almost on similar facts in
Jagdish Singh vs. Nathu Singh, 1992 (1) SCC 647. In the above
G
case also suit was filed for specific performance on the basis of a contract
to sell dated July 3, 1973, the suit was dismissed by the trial court as well
as First Appellate Court. However, the High Court in second appeal
reversed the finding of the courts below and held that plaintiff was ready
and willing to perform the contract and was entitled for decree. In the
H above case also during the pendency of the second appeal before the
URMILA DEVI v. THE DEITY, MANDIR SHREE CHAMUNDA 803
DEVI, THR. TEMPLE COMMNR [ASHOK BHUSHAN, J.]
High Court, proceedings for compulsory acquisition of the land was A
initiated and the land was acquired. Question arose as to whether plaintiff
was entitled for the amount of compensation received in the land
acquisition proceedings or was entitled only to the refund of the earnest
money. The High Court in the above case has modified the decree of
the specific performance of the contract with decree for a realisation of
B
compensation payable in lieu of acquisition. In paragraph 13 of the
judgment the directions of the High Court were extracted which is to
the following effect:
“13. The High Court issued these consequential directions:
“If the decree for specific performance of contract in C
question is found incapable of being executed due to
acquisition of subject land, the decree shall stand suitably
substituted by a decree for realisation of compensation
payable in lieu thereof as may be or have been determined
under the relevant Act and the plaintiff shall have a right to
recover such compensation together with solatium and D
interest due thereon. The plaintiff shall have a right to recover
it from the defendant if the defendant has already realised
these amounts and in that event the defendant shall be further
liable to pay interest at the rate of 12 per cent from the date
of realisation by him to the date of payment on the entire E
amount realised in respect of the disputed land.”
13. In the above context, this Court proceeded to examine the
ambit and scope of Section 21 of the Specific Relief Act. This Court
came to the opinion that when the contract has become impossible with
no fault of the plaintiff, Section 21 enables the Court to award F
compensation in lieu of the specific performance. Paragraphs 24, 29
and 30 are extracted below:
“24. When the plaintiff by his option has made specific
performance impossible, Section 21 does not entitle him to
seek damages. That position is common to both Section 2 of G
Lord Cairn’s Act, 1858 and Section 21 of the Specific Relief
Act, 1963. But in Indian law where the contract, for no fault
of the plaintiff, becomes impossible of performance Section
21 enables award of compensation in lieu and substitution
of specific performance.
H
804 SUPREME COURT REPORTS [2018] 1 S.C.R.
A 29. In the present case there is no difficulty in assessing the
quantum of the compensation. That is ascertainable with
reference to the determination of the market value in the
land acquisition proceedings. The compensation awarded
may safely be taken to be the measure of damages subject,
of course, to the deduction therefrom of money value of the
B
services, time and energy expended by the appellant in
pursuing the claims of compensation and the expenditure
incurred by him in the litigation culminating in the award.
30. We accordingly confirm the finding of the High Court
that respondent was willing and ready to perform the
C contract and that it was the appellant who was in breach.
However, in substitution of the decree for specific
performance, we make a decree for compensation,
equivalent to the amount of the land acquisition
compensation awarded for the suit lands together with
D solatium and accrued interest, less a sum of Rs 1,50,000
(one lakh fifty thousand only) which, by a rough and ready
estimate, we quantify as the amount to be paid to the appellant
in respect of his services, time and money expended in
pursuing the legal claims for compensation.”
E 14.This Court in Kanshi Ram vs. Om Prakash Jawal and
others, 1996 (4) SCC 593, has again in context of suit for specific
performance of the contract held that granting decree for specific
performance of contract is one of the discretion to be exercised on sound
principles. When the court gets into equity jurisdiction, it would be guided
by justice, equity, good conscience and fairness to both the parties.
F
15.From materials brought on record, it does appear compensation
was determined in favour of defendant No.6 to the extent of amount of
Rs.10,03,743/-. It also appears that compensation towards shops was
also determined. The name of defendant No.6 being recorded in the
Revenue records, compensation was determined in its favour. In view
G of the judgment and decree of courts below whereby the gift deed dated
08.07.1991 has been declared void, defendant No.6 is left with no right
in the suit land and is clearly not entitled to receive any amount consequent
to the acquisition of the suit land. It has not come on the record as to
whether compensation consequent to the acquisition of the suit land has
H been received by defendant No.6(respondent No.1 to the appeal) or not.
URMILA DEVI v. THE DEITY, MANDIR SHREE CHAMUNDA 805
DEVI, THR. TEMPLE COMMNR [ASHOK BHUSHAN, J.]
16. Taking into consideration overall facts of the present case, A
we are of the view that ends of justice be served in awarding
compensation of Rs.10 lakh in favour of the plaintiff-appellants out of
the compensation received consequent to the acquisition of the suit land.
The rest of the compensation, if any, received towards land and shops in
question has to be paid to the land owner that is defendant Nos.1 to 5
B
(respondent Nos.2 to 6 to this appeal) after deducting an amount of
Rs.10 lakh out of the said compensation. We further direct in event
compensation has not yet been disbursed, the compensation be disbursed
to the appellants (legal heirs of the plaintiff) and respondent Nos.2 to 6
in the above manner and in the event the compensation has been received
by defendant No.6 (respondent No.1), respondent No.1 shall return the C
compensation to the extent of Rs.10 lakh to the appellants and the rest
of the amount to defendant Nos.1 to 5 (respondent Nos.2 to 6). The
judgment and decree of the High Court dated 02.11.2012is modified to
the above extent.
17. The appeal is allowed accordingly. D
Devika Gujral Appeal partly allowed.
E
F
G
H
Search Indian case law
Ask in plain English, not just keywords. 25,000 AI words free, no card.
Try "specific performance"Sign in to search