Power Of Attorney Holder Cannot Give Evidence About Readiness & Willingness Of Plaintiff In Specific Performance Suit: SC

The Supreme Court held that in a suit for specific performance in which the plaintiff is required to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract, a Power of Attorney Holder is not entitled to depose in place and instead of the plaintiff (principal).

The Court held thus in an appeal filed against the judgment of Madhya Pradesh High Court by which it allowed the appeal and set aside the judgment of the Trial Court.

The two-Judge Bench comprising Justice Pankaj Mithal and Justice Prashant Kumar Mishra observed, “… we are of the view that in view of Section 12 of the Specific Relief Act, 1963, in a suit for specific performance wherein the plaintiff is required to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract, a Power of Attorney Holder is not entitled to depose in place and instead of the plaintiff (principal). In other words, if the Power of Attorney Holder has rendered some ‘acts’ in pursuance of power of attorney, he may depose for the principal in respect of such acts, but he cannot depose for the principal for the act done by the principal and not by him. Similarly, he cannot depose for the principal in respect of the matter of which only the principal can have personal knowledge and in respect of which the principal is entitled to be cross-examined.”

The Bench said that if a plaintiff, in a suit for specific performance is required to prove that he was always ready and willing to perform his part of the contract, it is necessary for him to step into the witness box and depose the said fact and subject himself to cross-examination on that issue.

Senior Advocate Dhruv Agrawal appeared for the appellant while Senior Advocate Gagan Gupta appeared for the respondents.

Facts of the Case -

The appellant/plaintiff entered into an agreement to sell with the respondent/defendant i.e., Power of Attorney (POA) for purchase of land for sale consideration totalling Rs. 4,41,000/-. The plaintiff paid earnest money on the date of agreement to sell and the balance amount was to be paid on the date of registration of the sale deed which was to be done within 6 months. In 1996, the plaintiff paid an additional amount for which an endorsement was made on the backside of the agreement. Thereafter, another agreement was executed between the parties extending the execution of the sale deed. However, the POA executed the sale deed of the suit land in favour of the respondents even though they were aware of the earlier sale agreement and its extensions.

The sale deed was executed behind the back of the plaintiff which came to his notice subsequently on which a legal notice was sent in 1997. However, the respondents did not attend the Registrar Office and the plaintiff was informed that the suit land was sold in favour of the respondents. He objected to this and the Gram Panchayat assured him that the respondents will execute the deed in his favour, and therefore, the legal action was not taken. A suit was filed in 2000 and the Trial Court decreed the same. In an appeal preferred by the respondents, the High Court allowed the same and set aside the judgment of the Trial Court. As a result, the plaintiff approached the Apex Court.

The Supreme Court in the above context of the case said, “A plaintiff cannot examine in his place, his attorney holder who did not have personal knowledge either of the transaction or of his readiness and willingness. The term ‘readiness and willingness’ refers to the state of mind and conduct of the purchaser, as also his capacity and preparedness, one without the other being not sufficient. Therefore, a third party having no personal knowledge about the transaction cannot give evidence about the readiness and willingness.”

The Court referred to the judgment in the case of Saradamani Kandappan v. S. Rajalakshmi & Ors. (2011) 12 SCC 18, in which it was held that every suit for specific performance need not be decreed merely because it is filed within the period of limitation by ignoring time limits stipulated in the agreement.

“The courts will also frown upon suits which are not filed immediately after the breach/refusal. The fact that limitation is three years does not mean that a purchaser can wait for one or two years to file a suit and obtain specific performance”, it added.

The Court further took note of the fact that the plaintiff entered into an agreement with only one of the co-owners and thereafter sought extensions for execution of the sale deed but did not prefer any suit though he was aware of the sale deed executed in favour of the defendants and sent a legal notice and even objected to the subsequent purchasers’ application for mutation of their names in the revenue records and referred to a meeting of the Gram Panchayat, yet the suit was preferred, on the last date of limitation.

“… the suit having been preferred after a long delay, the plaintiff is not entitled for specific performance on this ground also. … For the foregoing, we uphold the judgment and decree dated 01.09.2016 passed in FA No. 340 of 2003 by the High Court”, it concluded.

Accordingly, the Apex Court dismissed the appeal and upheld the judgment of the High Court.

Cause Title- Rajesh Kumar v. Anand Kumar & Ors. (Neutral Citation: 2024 INSC 444)

Appearance:

Appellant: Senior Advocate Dhruv Agrawal, AOR M/S. Aura & Co., Advocates Yashish Chandra, Advocates Nishit Agrawal, Harsh Bansal, Kushagra Pandey, Vanya Agrawal, and Kanishka Mittal.

Respondents: Senior Advocate Gagan Gupta, Advocates Vineet Chaudhary, Santosh Chaudhary, Hemang Chaudhary, Saurabh Gupta, and AOR Rahul Gupta.

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