K.S. MANJUNATH AND OTHERS v. MOORASAVIRAPPA @ MUTTANNA CHENNAPPA BATIL, SINCE DECEASED BY HIS LRS AND OTHER

Citation: 2025 INSC 1298, [2025] 12 S.C.R. 43

Court: Supreme Court of India

Bench: J.B. Pardiwala and R. Mahadevan, JJ.

Judgment text

SUPREME COURT OF INDIA K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, [2025] 12 S. C. R. 43 : 2025 INSC 1298 K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other (Civil Appeal No(s). 13507-13508 of 2025) 10 November 2025 [J. B. Pardiwala* and R. Mahadevan, JJ. ] Issue for Consideration Whether the High Court committed any error in passing the impugned judgment whereby it allowed the appeals filed by the vendees and set aside the decree passed by the Trial Court, while granting the relief of specific performance of Agreement to Sell executed by the Original Vendors in favour of the Original Vendees and holding the Appellants-Subsequent Purchasers not to be the bona fide purchasers of the subject land for value without notice.

Headnotes† Specific Relief Act, 1963 - Unilateral termination of the agreement to sell by one party - Impermissible, except where the agreement itself is determinable in nature in terms of s.

14 - Original vendors executed an unregistered Agreement to Sell (ATS) in favour of the original vendees in respect of 354 Acres of the Subject Land - However, later, they sent a Notice of Termination to the original vendees thereby terminating the ATS - Subsequently, original vendors sold the subject land to the subsequent purchasers - Original vendees filed suit inter alia seeking specific performance of the ATS against both the original vendors and the subsequent purchasers - Trial Court held that the original vendees failed to make good their case for grant of relief of specific performance - In appeals by the original vendees, High Court decreed the suit for specific performance in their favour - Challenge to: Held: Unilateral termination of the agreement to sell by one party is impermissible in law except in cases where the agreement itself is determinable in nature in terms of s.

14 - If such unilateral termination of a non-determinable agreement to sell is permitted * Author 44 as a defence, then virtually every suit for specific performance can be frustrated by the defendant by placing an unfair burden on the plaintiff, who despite performing his part of the obligations and having showcased readiness and willingness, would require to also seek a separate declaration that the termination was bad in law - In such cases, the burden cannot be casted upon the plaintiff to challenge the alleged termination of agreement - If a contract itself gives no right to unilaterally terminate the contract, or such right has been waived, and a party still terminates the contract unilaterally then that termination would amount to a breach by repudiation, and the non-terminating party can directly seek specific performance without first seeking a declaration - In the event it is found that the termination of agreement to sell by the defendant was not valid, then such an agreement to sell will remain subsisting and executable - In the present case, ATS was devoid of any clause enabling termination for convenience or otherwise empowering either party to terminate unilaterally - ATS being non-determinable in nature, no unilateral expression of termination could have lawfully extinguished the obligations undertaken thereunder - Neither of the grounds assigned in the notice of termination constituted a valid basis for terminating the ATS - Grounds cited in the notice of termination, namely, the subsistence of a status quo order and the death of one of the original vendors cannot be said to be based on any default or breach by the original vendees - Original vendees performed their part by paying a substantial amount and were also ready and willing to perform the terms of ATS - Termination of ATS vide notice of termination was unilateral and also not bona fide - Termination was invalid - ATS continues to remain alive, subsisting, and executable - Once the alleged termination of agreement in question is found to be not bona fide and being done in a unilateral manner, no declaration challenging the alleged termination is required.

[Paras 43, 54, 55, 61, 66] Specific Relief Act, 1963 - s. 19(b) - Requisites to claim protection under - Bona fides of the subsequent purchasers in purchasing the subject land - If can claim protection/s. 19(b): Held: To claim protection u/s. 19(b), the purchaser must show three things: (a) purchase for value, (b) payment in good faith, and (c) absence of notice of the earlier contract - Subsequent purchasers cannot take shelter u/s. 19(b) - They had sufficient notice of the facts that an ATS dated 28. 04. 2000 existed; the names and K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other addresses of the original vendees; that an earnest money amounting to Rs.

2,00,000/- had been paid by the original vendees to the original vendors; that the original vendors had sought to terminate the ATS due to their inability to execute the sale deed in favour of the original vendees on account of a status quo order; that the date of actual termination could not have coincided with the date of notice; and that deemed termination would have arose only if the original vendees had failed to claim the earnest money within one month; and that despite the issuance of the notice of termination in 2003, the original vendees continued to contest the impleadment application in the Original Suit No.

30 of 2001 until 2005 - These circumstances should have reasonably aroused suspicion or at the very least prompted further inquiry by any prudent bona fide purchaser - Yet the subsequent purchasers despite having ample opportunity to become aware of these facts abstained from making any such inquiries - A subsequent purchaser who relies merely on the assertions of the vendor or who chooses to remain content with his own limited knowledge while consciously abstaining from making further inquiry into the subsisting interests in the property cannot escape the consequences of deemed notice - Thus, a purchaser who has before him a document which on its very face shows the termination to be unilateral and rooted in the vendors' inconvenience cannot by shutting his eyes claim the benefit of "good faith" - s. 2(11) of the BNS. - s. 3(22) of General Clauses Act, 1897.

[Paras 78, 81] Specific Relief Act, 1963 - Unilateral termination of the agreement to sell (ATS) by original vendors - If there was a requirement of seeking a declaration from the court as regards the legality and validity of the purported termination of the ATS by the notice of termination issued by the original vendors: Held: Once the alleged termination of a non-determinable agreement in question is found to be not for bona fide reasons and being done in a unilateral manner on part of the defendant, it cannot be said that any declaration challenging the alleged termination was required on part of plaintiff - In the present case, the termination of ATS vide notice of termination was unilateral and also not bona fide - Neither of the reasons assigned in the notice of termination constituted a valid basis for terminating the ATS - Termination was invalid - ATS continues to remain alive, subsisting, and executable. [Paras 43, 54, 61] 46 Specific Relief Act, 1963 - s.

16 (c) - Readiness and willingness of the Original Vendees to perform the Agreement to Sell (ATS): Held: s. 16(c) requires that a plaintiff must both plead and prove that he has either performed, or has always been ready and willing to perform, the essential terms of the contract incumbent upon him - A party seeking enforcement of a contract must establish that all conditions precedent have been satisfied, and that he has either discharged or stood prepared and willing to discharge his obligations under the contract - Original vendees had performed their part of the contract to the extent required, and had consistently been ready and willing to perform their remaining obligations under the ATS - Appellants directed to execute a sale deed in respect of the subject land in favour of the Respondent Nos. 15 to 22, respectively & the Respondent Nos.

1 to 5, respectively, and also hand over vacant and peaceful possession of the subject land to them within six months from the date of this judgment, subject to the fulfilment of directions issued - Further directions issued. [Paras 82, 86, 90] Specific Relief Act, 1963 - Law on unilateral termination vis- à-vis determinable contracts, discussed.

[Paras 45-51] Specific Relief Act, 1963 - Failure to challenge the legality and validity of termination of ATS in the suit - Subsequent purchasers argued that the Suit filed by the original vendees inter alia seeking specific performance of ATS was not maintainable because the original vendees failed to also seek a declaration from the court in respect of whether the notice of termination of the ATS was bad in law or invalid: Held: The same would not preclude this Court to determine if the suit for specific performance filed by the original vendees was not maintainable for want of such declaration - Views adopted by the High Courts on failure to seek declaration, discussed - Principles of law enumerated. [Paras 30, 43] Case Law Cited I. S. Sikandar (Dead) by LRs v K. Subramani & Ors. [2013] 17 SCR 24 : 2013 (15) SCC 27; Sangita Sinha v. Bhawana Bhardwaj [2025] 4 SCR 551 : 2025 SCC OnLine SC 723 - distinguished. R. Kandasamy (since dead) & Ors. v T. R. K. Sarawathy & Anr.

, 2024 SCC OnLine SC 3377; Annamalai v. Vasanthi, 2025 SCC OnLine SC 2300; Indian Oil Corporation v. Amritsar Gas Service K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other and Ors. [1990] Supp. 3 SCR 196 : (1991) 1 SCC 533; Ram Niwas v. Bano [2000] Supp. 2 SCR 39 : (2000) 6 SCC 685; JP Builders v. A. Ramadas Rao [2010] 15 SCR 538: (2011) 1 SCC 429; Satya Jain v. Anis Ahmed Rushdie [2013] 3 SCR 319 : (2013) 8 SCC 131; Manjit Singh v. Darshana Devi, 2024 SCC OnLine 3431 - referred to. Brahm Dutt v. Sarabjit Singh, 2017 SCC OnLine P&H 5489; Brahm Dutt v. Sarabjit Singh, 2018 SCC Online SC 3961; Balwinder Sarpal v. Ram Kumar Bansal, 2022 SCC OnLine P&H 440; S. K. Ravichandran v. M. Thanapathy, 2022 SCC OnLine Mad 9094; S. K. Ravichandran v. M. Thanapathy, 2022 SCC Online SC 2369; Rajesh Sethi S. C. v. P. C. Sethi, 2023 SCC OnLine Del 7010; Kavi Ghei v. Rohit Vaid,2024 SCC OnLine Del 6118; A. Kanthudu v. S.

Venkat Narayana, Appeal No. 678/2007; Ajay Narain v. Arti Singh,(2025) 316 DLT 425; A Murugan and Others v Rainbow Foundation Ltd. and Ors. ,2019 SCC OnLine Mad 37961; Narendra Hirawat & Co. v. Sholay Media Entertainment Pvt. Ltd. , 2020 SCC OnLine Bom 391; DLF Home Developers Limited v. Shipra Estate Limited, 2021 SCC OnLine Del 4902; Affordable Infrastructure & Housing Projects (P) Ltd. v. Segrow Bio Technics India (P) Ltd. , 2022 SCC OnLine Del 4436; Kheoni Ventures (P) Ltd. v. Rozeus Airport Retail Ltd. , 2024 SCC OnLine Bom 773;Durg Singh v. Mahesh Singh, 2004 SCC OnLine MP 9; Jammula Rama Rao v. Merla Krishnaveni, 2002 SCC OnLine AP 646 - referred to. Jones v. Smith (1841) 1 Hare 43 - referred to. Books and Periodicals Cited Pollock & Mulla (17th Edition) - referred to. List of Acts Specific Relief Act, 1963; General Clauses Act, 1897; Bhartiya Nyaya Sanhita, 2023.

List of Keywords Suit for specific performance; Agreement to Sell (ATS); Notice of termination; Unilateral termination of the agreement to sell by one party; Unilateral termination of a non-determinable agreement to sell; Subsequent Purchasers not to be the bona fide purchasers of the subject land for value without notice; Termination of ATS unilateral and not bona fide; Termination was invalid; Section 19 (b), 48 Specific Relief Act, 1963; Section 16 (c), Specific Relief Act, 1963; Readiness and willingness to perform the Agreement; Original Vendors; Original Vendees; Subsequent Purchasers. Case Arising From CIVIL APPELLATE JURISDICTION: Civil Appeal No(s). 13507-13508 of 2025 From the Judgment and Order dated 22. 03. 2017 of the High Court of Karnataka Circuit Bench at Dharwad in RFA Nos. 4187 of 2013 and 4160 of 2012 Appearances for Parties Advs. for the Appellants: Dr. Aditya Sondhi, Dr. Joseph Aristotle S. , Sr. Advs. , Mr. Naveen Nagarjuna, Ms.

Priya Aristotle, Maeen Mavara M, Anubhav Kumar, Ms. B. Lekshmi, Ms. Priya Aristotle. Advs. for the Respondents: Devadatt Kamat, Ms. Supreeta Sharanagouda, Sharanagouda Patil, Mrs. Supreeta Sharanagouda, Yash S Tiwari, Nishanth Patil, Rajesh Inamdar, Harsh Pandey, Arijit Dey, Abhishek Gupta, Awanish Gupta, Ms. Bhumi Agrawal, Ms. Supreeta Sharanagouda. Judgment / Order of the Supreme Court Judgment J. B. Pardiwala, J. For the convenience of exposition, this judgment is divided into the following parts:- INDEX* A. FACTUAL MATRIX .................................................................. 2 B. SUBMISSIONS OF THE PARTIES ......................................... 14 (i). Submissions on behalf of the Appellants / Subsequent Purchasers ...................................................................... 14 * Ed. Note: Pagination as per the original Judgment. K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other (ii).

Submissions on behalf of the Respondents / Original Vendees .......................................................................... 17 C. ANALYSIS ................................................................................. 19 (I). Failure to challenge the legality and validity of termination of ATS in the suit ........................................ 19 (a) Views adopted by the High Courts on failure to seek declaration ................................................................ 28 (b) Whether the ATS dated 28. 04. 2000 was in nature determinable? .......................................................... 53 (II). Bona fides of the subsequent purchasers in purchasing the subject land ............................................................... 73 (III). Readiness and willingness of the Original Vendees to perform the ATS ................................................................ 87 D.

CONCLUSION ........................................................................... 95 1. Leave Granted. 2. Since the issues raised in both the captioned appeals are the same, the parties are same, and the challenge is also to the self-same, judgment and order passed by the High Court, those were taken up for hearing analogously and are being disposed of by this common judgment and order. 3. These appeals arise from the common judgment and order passed by the High Court of Karnataka in the Regular First Appeal Nos. 4187 of 2013 and 4160 of 2012 respectively by which the High Court allowed the two appeals filed by the vendees and thereby, set aside the judgment and decree dated 21. 07. 2012 passed by the 2nd Additional Senior Civil Judge at Haveri, Karnataka ("Trial Court") in Original Suit No. 36 of 2007, while granting the relief of specific performance of Agreement to Sell dated 28. 04. 2000 ("ATS") executed by the Respondent Nos.

6 to 13 ("Original Vendors") in favour of the Respondent Nos. 15 to 22 respectively & the Respondent Nos. 1 to 5 respectively ("Original Vendees") and holding the Appellants herein 50 ("Subsequent Purchasers") not to be the bona fide purchasers of the subject land (as defined below) for value without notice. A. FACTUAL MATRIX 4. For the sake of convenience, the respective positions of the contesting parties to the present lis before the various courts leading upto this Court is tabularly illustrated herein below: Before This Before The Before The Particulars Court High Court Trial Court Appellants Respondent Defendant Subsequent Purchasers Nos. 8 to 15 Nos. 9 to 16 of subject land Respondent Appellants Defendant One of the Original Nos. 1 to 5 No. 7 Vendees of the subject land, however, he was (Legal Heirs arrayed as a defendant in of Defendant the suit. This defendant No. 7 on supported the case of record) plaintiffs. Respondent Respondent Defendant Original Vendors of the Nos.

6 to 13 Nos. 1 to 6 Nos. 1 to 6 subject land (Legal Heirs of Defendant Nos. 4 and 6 on record) Respondent Respondent Defendant One of the Original No. 14 No. 7 No. 8 Vendees of the subject land, however, he was arrayed as a defendant in the suit. This defendant was proceeded ex-parte by the Trial Court Respondent Appellants Plaintiffs Original Vendees of the Nos. 15 to 22 subject land Respondent Nos. 15 to 22, Respondent Nos. 1 to 5, and Respondent No. 14 being the original purchasers of subject land are also collectively being referred to as "Original Vendees" in the present matter. K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other 5. On 28. 04. 2000, the original vendors executed an unregistered ATS in favour of the original vendees in respect of 354 Acres of Agricultural Watan Land bearing survey no.

12/2 part 12/2A situated in village Basavanakoppa, Taluk Shiggaon, District Haveri, Karnataka ("Subject Land") for a total sale consideration of Rs. 26,95,501/- out of which the original vendees paid an amount of Rs. 2,00,000/- as earnest money to the original vendors. It was agreed that an additional amount of Rs. 5,00,000/- would be paid by the original vendees to the original vendors at the time of registration of the ATS and the balance sale amount would be paid at the time of registration of the sale deed. It was also agreed that the original vendees would execute the sale deed within two months of the original vendors, informing them about the change of subject land from new tenure to old tenure in the record of rights, surveying, measuring, fixing the boundaries of subject land and shifting 19 tenants residing on the subject land to one particular place.

Between the years 2000 and 2001, the original vendees paid some further amount to the original vendors, in all aggregating to Rs. 8,12,500/-. 6. On 24. 03. 2001, one Sunil Anand Rao Desai, nephew of the original vendors, instituted the Original Suit No. 30 of 2001 in the court of the Principal Senior Civil Judge at Haveri against the original vendors herein inter alia seeking partition and possession of certain properties including the subject land and revocation of a partition deed dated 29. 12. 1996 (unrelated to the present case) to which the original vendees were not parties. On 11. 04. 2001, an order of status quo came to be passed by the Principal Senior Civil Judge. When the original vendees came to know about the institution of the Original Suit No. 30 of 2001, they took steps to enforce their rights under the ATS and sought to implead themselves as parties in the said suit by filing an impleadment application dated 27. 08. 2001.

The said application came to be rejected by the Principal Senior Civil Judge vide its order dated 16. 03. 2005. Later, aggrieved by rejection to impleadment application, the original vendees preferred a Writ Petition being WP No. 17952 of 2005 before the High Court. However, the same also came to be dismissed by the High Court vide its order dated 18. 07. 2005. 7. In the interregnum and during the pendency of the aforementioned Original Suit No. 30 of 2001, the original vendees got the subject land converted from new tenure to old tenure on behalf of the original 52 vendors and also persuaded those 19 tenants who were residing on the subject land to relocate themselves to some other portion of the land. Meanwhile, one of the original vendees i. e. the Respondent No. 14 herein entered into an agreement dated 28. 12. 2002 wherein he released and relinquished his right under the ATS in favour of the remaining original vendees. 8. On 10. 03.

2003, the original vendors sent a Legal Notice ("Notice of Termination") to the original vendees thereby terminating the ATS and informing them of their inability to execute a sale deed inter alia for two reasons - (i) Long pendency of the Original Suit No. 30 of 2001 and the status quo order in force therein, and (ii) The death of one of the original vendors i. e. , Smt. Godavari @ Mahalaxmi Kulkarni. In the said notice of termination, the original vendors called upon the original vendees to take back the earnest money paid by them and treat the ATS as cancelled within one month from the date of receipt of said notice, failing which the ATS would be "deemed to be cancelled". The relevant portion of the said notice reads as under: "In view of the pending litigation and death of Smt. Godavari urf Mahalakshmi G. Kulkarni, my clients are not in a position to go ahead with the transaction as per agreement of sale deed dt. 28. 04. 2000. My clients cannot wait for an indefinite period.

Furthermore they cannot be definite about their share in the land in view of the litigation and it is also subject to the decision of the court. Hence, my clients are unable to execute a sale deed in respect of the land in question as per agreement dt. 28. 04. 2000. Under the circumstances, you are hereby called upon to take back your earnest money and to treat the agreement of sale dt. 28. 04. 2000 as cancelled within a period of one month from the date of receipt of this notice. Failing which the agreement of sale dt. 28. 04. 2000 is deemed to be cancelled and the legal effects and rights of my clients will take their own course and my clients will be at liberty to deal with the above said land in accordance with law. " (Emphasis Supplied) 9. To the aforesaid, the original vendees on 21. 03. 2003 gave a reply stating as follows: K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other (i).

That they had fulfilled the terms of the ATS by getting the subject land surveyed, measured, and boundaries fixed, and carrying out the conversion of tenure of the subject land which otherwise was the obligation of the original vendors under the ATS; (ii). That they had time and again requested the original vendors to perform their part of the obligation of executing the sale deed; (iii). That they were always ready and willing to perform their part of the contract; (iv). That the further performance of the ATS had to be suspended due to the order of status quo passed in the Original Suit No. 30 of 2001 and the same would not render the ATS unenforceable; (v). That the original vendors were duty bound to execute the sale deed in their favour after the disposal of the Original Suit No. 30 of 2001; (vi). That the death of one of the original vendors would not have the effect of cancellation of the ATS because the legal heirs would be bound to perform in that regard; (vii).

That for all the above grounds the question of taking back the earnest money did not arise. 10. No further response was given by the original vendors to the aforesaid reply to their notice of termination. On 10. 02. 2007, the plaintiff in the Original Suit No. 30 of 2001 viz. , Sunil Anand Rao Desai filed a memo to withdraw the suit and get the status quo order vacated in effect thereto. On the basis of the withdrawal memo, the Principal Senior Civil Judge vide its order dated 14. 02. 2007 dismissed the Original Suit No. 30 of 2001 as being withdrawn and thus, the status quo order came to be vacated in effect thereto. Pursuant to the withdrawal of the said suit, the original vendors executed the sale deeds dated 20. 02. 2007 and 02. 03. 2007 respectively in favour of the subsequent purchasers, selling the subject land for a total sale consideration of Rs. 71,00,000/-. 11.

Having obtained knowledge of the sale deeds executed in favour of the subsequent purchasers, the original vendees instituted the Original Suit No. 36 of 2007 in the Trial Court on 09. 07. 2007 inter alia the relief of seeking specific performance of the ATS dated 28. 04. 2000 against both the original vendors and the subsequent purchasers. 54 12. The original vendees prayed for the following reliefs: "16. The plaintiffs pray: - (a) That the defendants be specifically ordered to perform the agreement dated 28. 04.

2000 and do all acts necessary to put the plaintiffs in full possession of the suit property as owners at the cost of the plaintiffs after receiving the balance consideration from the plaintiffs; (b) That the above acts be got done through Court Commissioner in case defendant/s fail to execute and register the sale deed; (c) In case for any reason whatsoever the court comes to the conclusion that the specific performance cannot be ordered, then the court may be pleased to order refund of amounts paid with damages and compensation which is total sum of Rs. 26,95,501/-; (d) Costs and such other reliefs as court deems fit and proper. " 13. Pursuant to the above, the Trial Court framed the following issues: "1. Whether plaintiffs prove that, defendants No. 1, 2, 4 and 6 and two others have agreed to sell the suit land RS No. 12/2 i. e. 12/2A measuring 354 acres of village Basasvanakoppa for a sum of Rs: 26,95,501/- on 28. 4. 2000 and paid Rs. 2,00,000/- as earnest money? 2.

Whether plaintiffs prove that, defendants No. 1, 2, 4 and 6 and others have agreed to execute the sale deed within one month after completion of the work of sub division. 3. Whether plaintiffs prove that they have paid amount of Rs. 9,45,000/- as shown in schedule B? 4. Whether plaintiffs prove that, they are ready, ever ready and always ready to perform their part of contract? 5. Whether defendants No. 1 to 4 and 9 to 16 prove that suit of the plaintiffs is hopelessly barred by them? 6. Whether defendant No. 1 to 4 prove that the suit of the plaintiffs is not maintainable without seeking relief of cancellation of sale deed? K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other 7. Whether deft. No. 10 proves that, deft. No. 9 to 16 are bonafide purchase of suit lands for valid consideration? 8. Whether plaintiffs are entitled to the relief of specific performance of contract of sale? 9. What order or decree? " 14.

The Trial Court answered the issues as under: (a) Issue Nos. 1, 2, 4 and 7 respectively were answered in the affirmative and the Issue No. 3 was answered partly in the affirmative - (i). That the original vendees successfully proved that the original vendors had agreed to sell the subject land for sale consideration of Rs. 26,95,501/- and had paid Rs. 2,00,000/- as earnest money; (ii). That the original vendees successfully proved that the original vendors had agreed to register the sale deed within one month after the completion of subdivision work; (iii). That the original vendees claim to have paid Rs. 9,45,000/in overall to the original vendors yet the evidence indicates that the original vendees had paid a total of Rs. 8,12,500/- to the original vendors; (iv). That the original vendees successfully proved that they were always ready and willing to perform their part of the contract; (v).

That the original vendees failed to prove that the subsequent purchasers had prior knowledge of the ATS. (vi). That the subsequent purchasers have proved that they are bona fide purchasers of the subject land for valid consideration without notice. (b) Issue Nos. 5, 6, and 8 respectively were answered in the negative - (i). That the delay in filing the suit was caused due to the pendency of the Original Suit No. 30 of 2001 and the original vendees had filed the suit after the execution of the sale deed by the original vendors in favour of the subsequent purchasers. Thus, the suit filed by the original vendees 56 was within limitation from the date of the disposal of the Original Suit No. 30 of 2001 as well as the execution of the sale deeds; (ii). That the suit of the original vendees was maintainable without seeking the relief of cancellation of the sale deeds.

This was because the original vendees were not party to those sale deeds and they had filed the suit for specific performance on the basis of ATS only; (iii). That the original vendees failed to prove that they were in actual possession of the subject land from the date of execution of the ATS and that the subsequent purchasers had bona fide purchased the subject land. Therefore, the grant of relief of specific performance in favour of the original vendees would cause hardship to the subsequent purchasers. (c) Issue No. 9 followed with the following order and direction - (i). That the original vendees had failed to make good their case for grant of relief of specific performance and that in the alternative, the original vendees were entitled to refund of an amount of Rs. 8,12,500/- alongwith damages @9% p. a. 15. Aggrieved by the judgment and decree dated 21. 07. 2012 passed by the Trial Court, the original vendees filed two separate appeals i. e. , the Regular First Appeal Nos.

4160 of 2012 and 4187 of 2013 respectively, before the High Court. As no cross objections were filed by the subsequent purchasers, the High Court framed the following point for its determination: "1. Whether the defendant 9 to 16 had established that they were bona fide purchasers for value of the suit property? " 16. The High Court allowed the two appeals by a common judgment and order dated 22. 03. 2017. It was held that the subsequent purchasers had been informed of the ATS by the original vendors and a copy of the notice of termination of ATS was also shared with the subsequent purchasers. This in High Court's opinion would indicate that the subsequent execution of sale deeds in favour of the subsequent purchasers was a deliberate act and in plain disregard to K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other the subsisting ATS in favour of the original vendees.

The High Court also observed that as the original vendors had not responded to the reply of original vendees to the notice of termination, the termination of ATS could never be said to have reached to its logical end, and that the ATS was still alive and binding. 17. Thus, the High Court held that the subsequent purchasers were not bona fide purchasers of the subject land for value without notice as they were aware of the earlier ATS executed in favour of the original vendees. The High Court directed the subsequent purchasers to execute the sale deeds in favour of the original vendees and put them in physical possession of the subject land. The original vendees, in turn, were directed to pay the balance sale consideration to the subsequent purchasers. The relevant portions of the impugned judgment at Page Nos. 29 to 31 are as under: "Apparently, there was no rejoinder to the reply notice.

It is also not shown that the defendants had offered to return the advance amount received, nor was it claimed to have been returned. The termination of the agreement was hence not taken to its logical end. The unilateral termination could not therefore said to be valid and binding on the plaintiffs. Defendants no. 1 to 6 were therefore aware of the circumstance that the advance amount paid by the plaintiffs was not refunded nor was it claimed to have been forfeited on any alleged breach of contract on the part of the plaintiffs. In the face of which, the circumstance that close on the heels of, the plaintiff in the civil suit in OS 30/2001 having withdrawn the suit, that was claimed as an impediment for completion of the sale transaction, defendants no. I to 6 having sold the property in favour of Defendants no.

9 to 16, who in turn were said to have been informed of the agreement of sale and the same having been terminated under the notice dated 10-3- 2001 and a copy of the same also said to having been furnished to the said defendants, would plainly indicate that the sale transaction was carried out deliberately and blatantly in the face of a subsisting agreement of sale in favour of the plaintiffs, with a clear intention of defeating the said agreement of sale in favour of the plaintiffs. Such 58 a deliberate act on the part of Defendants no. I to 6 and 9 to 16 would not enable them to claim that as they have achieved a fait accompli, though defendants may claim to be innocent and bona fide purchasers for value, as it is found that they were aware of the agreement of sale in favour of the plaintiffs, it cannot be said that the contract is no longer capable of ; performance as the property is now in the hands of a third party.

This may be true of genuinely bona fide purchasers and not such third-party purchasers who have brazenly entered into the transaction with eyes wide open and with notice of the subsisting agreement. The consequence would be that even defendants no. 9 to 16 would be obliged to complete the sale, as persons claiming under Defendants no. 1 to 6 by the due execution of a sale deed or sale deeds in favour of the plaintiffs and to convey the suit property in favour of the plaintiffs. Incidentally, it is our firm opinion that it would be unjust to grant a lesser relief to the plaintiffs in directing the refund of the earnest money or to embark upon an exercise of determining any damages which the plaintiffs could very well claim. Such an exercise would have been justified if the defendants no. 9 to 16 had established their bona fides, which they have not. In the result, the appeals are allowed and the judgment of the trial court is set aside. The suit for specific performance is decreed.

Defendants 9 to 16 shall execute sale deeds in favour of the plaintiffs in respect of such portions of the suit property that they may have purchased from Defendants no. 1 to 6, in favour of the plaintiffs and put them in physical possession of the same. The plaintiffs shall pay the balance sale price in consideration thereof, proportionately. The sale transactions shall be completed within a period of three months, if not earlier. In the event of default on the part of the said defendants in this regard, the plaintiffs shall be entitled to have the sale deeds executed through the court below, in the manner as may be directed by it. " (Emphasis Supplied) K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other 18. In such circumstances referred to above, the subsequent purchasers are here before us with the present appeals. B. SUBMISSIONS OF THE PARTIES (i). Submissions on behalf of the Appellants / Subsequent Purchasers 19. Dr.

Aditya Sondhi, the learned senior counsel appearing for the subsequent purchasers would submit that the courts below committed a serios error in decreeing the suit for specific performance filed by the original vendees in as much as the same was barred by limitation. The learned counsel argued that as per Article 54 of the Limitation Act, 1963, the period of the limitation to institute a suit for specific performance is 3 years from the date when a plaintiff has notice of refusal of performance. According to the learned counsel, the ATS was terminated by the original vendors vide notice of termination dated 10. 03. 2003 and thus, the limitation period could be said to have expired on 10. 03. 2006. However, the original vendees filed the Original Suit No. 36 of 2007 on 09. 04. 2007 i. e. after a delay of total 11 months. 20. He further submitted that the original vendees' explanation as regards delay in filing the Original Suit No.

36 of 2007 by relying on the pendency of their impleadment application in the Original Suit No. 30 of 2001 is misconceived in as much as: (a) the impleadment application of the original vendees' in the Original Suit No. 30 of 2001 was filed much prior to the notice of termination and on the basis of a wholly different cause of action and (b) the notice of termination was issued by the original vendors on 10. 03. 2003 i. e. later in time to the filing of the impleadment application, giving rise to a fresh cause of action in respect of specific performance. 21. The learned senior counsel further submitted that the Original Suit No. 36 of 2007 filed for seeking specific performance was not maintainable in law in the absence of there being any prayer seeking declaration in respect of the legality and validity of the termination of the ATS. For this, the learned counsel placed reliance on the decisions of this Court in I. S. Sikandar (Dead) by LRs v K. Subramani & Ors.

, reported in2013 (15) SCC 27andR. Kandasamy (since dead) & Ors. v T. R. K. Sarawathy & Anr. , reported in 2024 SCC OnLine SC 3377 respectively wherein this Court had held that a suit for 60 specific performance is not maintainable in the absence of a prayer for declaration that the notice of termination of agreement of sale is bad in law. 22. The learned senior counsel further submitted that his clients are bona fide purchasers of the subject land for value without notice and that too after 4 years of the termination of the ATS. He would submit that at the time of the sale of the subject land there was no suit pending. According to the learned counsel, the ATS being an unregistered document and the same being terminated by the original vendors, they had no occasion to have notice to anything contrary.

The learned counsel submitted that the subsequent purchasers made bona fide enquires about the title of the original vendors and all other necessary particulars before purchasing the subject land. The subsequent purchasers were made aware by the original vendors about the termination of the ATS vide the notice of termination prior to the purchase of the suit property. It was argued that the title and possession of the subject land was with the original vendors at the time of the sale. 23. In the last, the learned senior counsel submitted that the ATS was executed in favour of six different individuals who were joint vendees and that there was no division of each person's interest. Four of the original vendees chose to file the Original Suit No. 36 of 2007 as plaintiffs. Two of the original vendees i. e. the Respondent Nos. 1 to 5 herein and the Respondent No. 14 herein respectively, were arrayed as the defendant no. 7 and defendant no. 8 respectively in the Original Suit No.

36 of 2007, out of which the defendant no. 7 supported the case of the original vendees, however, the defendant no. 8 was proceeded ex-parte by the Trial Court. This defendant no. 8 chose not to appear before the High Court. He has not appeared before this Court as well. One of the original vendees i. e. defendant no. 7 never sought the relief of specific performance of the ATS. On such premise, the learned counsel argued that the ATS being indivisible, and in the absence of all the vendees seeking enforcement of the same, the relief of specific performance is not enforceable in law. (ii). Submissions on behalf of the Respondents / Original Vendees 24. Mr. Devadatt Kamat, the learned senior counsel, appearing for the original vendees vehemently submitted that no error not to speak of K. S. Manjunath and Others v.

Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other any error of law could be said to have been committed by the High Court in passing the impugned judgement and order. On the point of limitation, the learned counsel argued that the Trial Court after due consideration of the facts of the present matter and the evidence on record rightly held that the Original Suit No. 36 of 2007 filed by the original vendees was not time barred. He submitted that the appellant herein / subsequent purchasers had not even challenge this finding of limitation before the High Court and that the High Court limited its adjudication only to the issue whether the subsequent purchasers were bona fide purchasers or not. In arguendo, the learned counsel argued that even otherwise the original vendees would be entitled to seek the benefit of Section 14 of the Limitation Act, 1963 in as much as they were seeking impleadment in the Original Suit No. 30 of 2001. 25.

It was sought to be argued that the time consumed in impleading themselves as parties in Original Suit No. 30 of 2001 and in the Writ Petition No. 17952 of 2005 has to be excluded under Section 14 of the Limitation Act, 1963 since: (1) both the Original Suit No. 30 of 2001 and the Original Suit No. 36 of 2007 were civil proceedings; (2) the impleadment application filed by the original vendees was dismissed by recording a finding that they were not a necessary party; and (3) original vendees agitated their rights under the same ATS in both the proceedings and that specific submissions regarding their readiness and willingness to perform the contract were made in both the proceedings. 26. The learned counsel further submitted that the High Court was right in holding that the subsequent purchasers are not bona fide purchasers of the subject land. He argued that it is evident from the conduct and flow of events that the subsequent purchasers are not bona fide purchasers.

He pointed out that the subsequent purchasers entered into sale deeds on 20. 02. 2007 and 02. 03. 2007 respectively i. e. within 6 (Six) days and 15 (Fifteen) days respectively of the withdrawal order dated 14. 02. 2007 passed in the Original Suit No. 30 of 2001. The timing of the execution clearly shows that the sale deeds were executed with the sole intent to defeat the rights of the original vendees. Developing this argument further, the learned counsel submitted that the subsequent purchasers have admitted that they were shown the notice of termination dated 10. 03. 2003 and had the subsequent purchasers not been negligent, they would 62 have come to know the fact that the earnest money of the original vendees was never returned by the original vendors and that the original vendees had objected to the notice of termination vide their reply dated 21. 03. 2003. 27.

In the last, the learned senior counsel submitted that in so far as the readiness and willingness of the original vendees is concerned, the Trial Court and High Court have concurrently held that the original vendees were always ready and ever willing to perform their part of the ATS. 28. In such circumstance referred to above, the learned counsel prayed that there being no merit in the present appeals those may be dismissed. C. ANALYSIS 29. Having heard the learned counsel appearing for the parties and having gone through the materials on record, the only question that falls for our consideration is whether the High Court committed any error in passing the impugned judgment? (I). Failure to challenge the legality and validity of termination of ATS in the suit. 30. The subsequent purchasers have vehemently argued that the Original Suit No.

36 of 2007 filed by the original vendees inter alia seeking specific performance of ATS was not maintainable because the original vendees failed to also seek a declaration from the court in respect of whether the notice of termination of the ATS was bad in law or invalid. We are aware that neither the subsequent purchasers nor the original vendors had raised before the Trial Court the plea that the suit for specific performance filed by the original vendees was not maintainable in the absence of a declaration seeking the invalidity of the termination of ATS, no issue came to be framed by the Trial Court on this aspect. However, the same would not preclude this Court to determine if the suit for specific performance filed by the original vendees was not maintainable for want of such declaration as this Court recently in R.

Kandasamy (supra) had held that an appellate court would not be precluded from examining whether any jurisdictional fact exists for grant of relief of specific performance notwithstanding the fact that the trial court omitted K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other or failed to frame issue on maintainability of the suit. The relevant observation is as under: "25. What follows from A. Kanthamani [A. Kanthamani v. Nasreen Ahmed, (2017) 4 SCC 654: (2017) 2 SCC (Civ) 596] is that unless an issue as to maintainability is framed by the trial court, the suit cannot be held to be not maintainable at the appellate stage only because appropriate declaratory relief has not been prayed. xxx xxx xxx 43. In Shrisht Dhawan v. Shaw Bros. [Shrisht Dhawan v. Shaw Bros. , (1992) 1 SCC 534], an interesting discussion on "jurisdictional fact" is found in the concurring opinion of Hon'ble R. M. Sahai, J. (as his Lordship then was).

It reads: (SCC pp. 551-52, para 19) 19. ... What, then, is an error in respect of jurisdictional fact? A jurisdictional fact is one on existence or non- existence of which depends assumption or refusal to assume jurisdiction by a court, tribunal or an authority. In Black's Legal Dictionary it is explained as a fact which must exist before a court can properly assume jurisdiction of a particular case. Mistake of fact in relation to jurisdiction is an error of jurisdictional fact. No statutory authority or tribunal can assume jurisdiction in respect of subject-matter which the statute does not confer on it and if by deciding erroneously the fact on which jurisdiction depends the court or tribunal exercises the jurisdiction then the order is vitiated. Error of jurisdictional fact renders the order ultra vires and bad. [Wade, Administrative Law. ] In Raza Textiles [Raza Textiles Ltd. v.

CIT, (1973) 1 SCC 633: (1973) 87 ITR 539] it was held that a court or tribunal cannot confer jurisdiction on itself by deciding a jurisdictional fact wrongly. 44. Borrowing wisdom from the aforesaid passage, our deduction is this. An issue of maintainability of a suit strikes at the root of the proceedings initiated by filing of the plaint as per requirements of Order 7 Rule 1CPC. If a suit is 64 barred by law, the trial court has absolutely no jurisdiction to entertain and try it. However, even though a given case might not attract the bar envisaged by Section 9 CPC, it is obligatory for a trial court seized of a suit to inquire and ascertain whether the jurisdictional fact does, in fact, exist to enable it (the trial court) to proceed to trial and consider granting relief to the plaintiff as claimed.

No higher court, much less the Supreme Court, should feel constrained to interfere with a decree granting relief on the specious ground that the parties were not put specifically on notice in respect of a particular line of attack/defence on which success/failure of the suit depends, more particularly an issue touching the authority of the trial court to grant relief if "the jurisdictional fact" imperative for granting relief had not been satisfied. It is fundamental, as held in Shrisht Dhawan [Shrisht Dhawan v. Shaw Bros. , (1992) 1 SCC 534], that assumption of jurisdiction/refusal to assume jurisdiction would depend on existence of the jurisdictional fact. Irrespective of whether the parties have raised the contention, it is for the trial court to satisfy itself that adequate evidence has been led and all facts including the jurisdictional fact stand proved for relief to be granted and the suit to succeed.

This is a duty the trial court has to discharge in its pursuit for rendering substantive justice to the parties, irrespective of whether any party to the lis has raised or not. If the jurisdictional fact does not exist, at the time of settling the issues, notice of the parties must be invited to the trial court's prima facie opinion of non- existent jurisdictional fact touching its jurisdiction. However, failure to determine the jurisdictional fact, or erroneously determining it leading to conferment of jurisdiction, would amount to wrongful assumption of jurisdiction and the resultant order liable to be branded as ultra vires and bad. 45. Should the trial court not satisfy itself that the jurisdictional fact for grant of relief does exist, nothing prevents the court higher in the hierarchy from so satisfying itself.

It is true that the point of maintainability of a suit has to be looked only through the prism of Section 9CPC, and the court can rule on such point either upon framing of an K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other issue or even prior thereto if Order 7 Rule 11(d) thereof is applicable. In a fit and proper case, notwithstanding omission of the trial court to frame an issue touching jurisdictional fact, the higher court would be justified in pronouncing its verdict upon application of the test laid down in Shrisht Dhawan [Shrisht Dhawan v. Shaw Bros. , (1992) 1 SCC 534]. 46. In this case, even though no issue as to maintainability of the suit had been framed in the course of proceedings before the trial court, there was an issue as to whether the agreement is true, valid and enforceable which was answered against the sellers. Obviously, owing to dismissal of the suit, the sellers did not appeal.

Nevertheless, having regard to our findings on the point as to whether the buyer was "ready and willing", we do not see the necessity of proceeding with any further discussion on the point of jurisdictional fact here. 47. However, we clarify that any failure or omission on the part of the trial court to frame an issue on maintainability of a suit touching jurisdictional fact by itself cannot trim the powers of the higher court to examine whether the jurisdictional fact did exist for grant of relief as claimed, provided no new facts were required to be pleaded and no new evidence led. " (Emphasis Supplied) 31. In order to fortify their submission, the subsequent purchasers have relied upon the decision of this Court in I. S. Sikandar (supra) wherein the plaintiff had instituted a suit for specific performance of agreement of sale entered into with the defendants therein against the total sale consideration of Rs. 45,000/- in the year 1983. The plaintiff had paid Rs.

5,000 as part sale consideration. In 1985, the defendants issued a legal notice and called upon the plaintiff to comply with his part of the contract by paying the balance sale consideration against which the plaintiff had issued a response calling upon the defendants to execute a conveyance deed and receive the balance sale consideration. By another letter, the plaintiff also requested the defendants to go to the office of the Sub-Registrar for the purpose of execution of the 66 conveyance deed. However, the defendants sent a notice declining to accede to the plaintiff's request and rescinded the agreement to sell. This Court thus was seized with the question of whether the suit for specific performance of agreement of sale filed by the plaintiff therein against the defendants was maintainable without seeking a declaratory relief with respect to the notice of termination vide which the agreement of sale was terminated.

This Court held that in the absence of any prayer to declare the termination of agreement of sale as bad in law, the suit for specific performance filed by the plaintiff therein was not maintainable. The relevant observation is as under: "36. Since the plaintiff did not perform his part of contract within the extended period in the legal notice referred to supra, the agreement of sale was terminated as per notice dated 28-3-1985 and thus, there is termination of the agreement of sale between the plaintiff and Defendants 1-4 w. e. f. 10-4-1985. 37. As could be seen from the prayer sought for in the original suit, the plaintiff has not sought for declaratory relief to declare the termination of agreement of sale as bad in law.

In the absence of such prayer by the plaintiff the original suit filed by him before the trial court for grant of decree for specific performance in respect of the suit schedule property on the basis of agreement of sale and consequential relief of decree for permanent injunction is not maintainable in law. 38. Therefore, we have to hold that the relief sought for by the plaintiff for grant of decree for specific performance of execution of sale deed in respect of the suit schedule property in his favour on the basis of non- existing agreement of sale is wholly unsustainable in law. Accordingly, Point (i) (see para 32. 1) is answered in favour of Defendant 5. " (Emphasis Supplied) 32. Furthermore, in a recent decision of this Court in Sangita Sinha v. Bhawana Bhardwaj, reported in 2025 SCC OnLine SC 723, this Court had occasion to consider and deal with I. S. Sikander (supra) and R. Kandasamy (supra) respectively. In the said case the suit K. S. Manjunath and Others v.

Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other property that was allotted to the vendor by a cooperative society under a registered sub-lease. Later, an unregistered agreement to sell concerning the said property was executed between the vendors and the vendee for a total sale consideration of Rs. 25,00,000/-. At the time of the execution of the agreement to sell, the vendee had paid a sum of Rs. 2,51,000/- in cash to the vendors and had issued three post-dated cheques of the amount of Rs. 7,50,000/-. When the vendee visited the property along with her husband, the tenants of the vendors created a ruckus and drove them out. In January 2008, the vendors issued a notice to the vendee cancelling the agreement to sell and refunded to the vendee an amount of Rs. 2,11,000/- through five demand drafts and also returned two of the three post-dated cheques of Rs. 2,50,000/- each. It was the case of the plaintiff that an advance amount of Rs.

40,000/- still remained unpaid and that the agreement for sale was unilaterally terminated. The abovementioned refunded amount was later encashed by the vendee without any objection as regards the unpaid amount. When the vendee instituted the suit for specific performance, they failed to seek a declaration that the termination of agreement for sale was invalid. In this backdrop, this Court deliberated upon the issue of whether the suit filed by the vendee was maintainable in the absence of the declaration that the notice of termination was invalid. This Court while relying on the decisions in I. S. Sikander (supra) and R. Kandasamy (supra) respectively, heldthat a suit for specific performance is not maintainable in the absence of a declaratory relief that the termination of agreement was bad in law. The relevant observation is as under: "THE AGREEMENT TO SELL DATED 25TH JANUARY 2008 STOOD CANCELLED/TERMINATED. 21. This Court is also of the view that the act of the Respondent No.

1-buyer in encashing the demand drafts leads to an irresistible conclusion that the agreement in question stood cancelled. 22. The contention of the learned counsel for the Respondent No. 1- buyer that the Agreement to Sell dated 25th January 2008 could not have been cancelled unilaterally is contrary to facts as the letter dated 07th February 2008 along with the refund of the demand drafts 68 and two post-dated cheques was nothing but repudiation of the Agreement to Sell dated 25th January 2008 by the seller and the encashment of the demand drafts was acceptance of such repudiation by the Respondent No. 1-buyer, leading to cancellation of the Agreement to Sell dated 25th January 2008. 23. The contention that the demand drafts were encashed under protest is misconceived on facts as there is nothing on record to show that the demand drafts were encashed under protest. In fact, PW-2, who is the husband of the Respondent No.

1-buyer, has deposed that upon receipt of the demand drafts and cheques, the Respondent No. 1- buyer had not issued any letter to the seller stating that the amounts received by them were less than the earnest money paid by them. ABSENT A PRAYER FOR DECLARATORY RELIEF THAT CANCELLATION OF THE AGREEMENT IS BAD IN LAW, A SUIT FOR SPECIFIC PERFORMANCE IS NOT MAINTAINABLE 24. This Court further finds that the seller had admittedly issued a letter dated 7th February 2008 cancelling the Agreement to Sell dated 25th January 2008, prior to the filing of the subject suit on 5th May 2008. Even though the demand drafts enclosed with the letter dated 07th February, 2008 were subsequently encashed in July, 2008, yet this Court is of the view that it was incumbent upon the Respondent No.

1- buyer to seek a declaratory relief that the said cancellation is bad in law and not binding on parties for the reason that existence of a valid agreement is sine qua non for the grant of relief of specific performance. 25. This Court in I. S. Sikandar (Dead) By LRs. v. K. Subramani, (2013) 15 SCC 27 has held that in absence of a prayer for a declaratory relief that the termination of the agreement is bad in law, the suit for specific performance of that agreement is not maintainable. Though subsequently, this Court in A. Kanthamani v. Nasreen Ahmed, (2017) 4 SCC 654 has held that the declaration of law in I. S. Sikander (Dead) By LRs. v. K. Subramani (supra) regarding K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other non-maintainability of the suit in the absence of a challenge to letter of termination is confined to the facts of the said case, yet the aforesaid issue has been recently considered in R.

Kandasamy (Since Dead) v. T. R. K. Sarawathy (supra) authored by brother Justice Dipankar Datta and the conflict between the judgment of I. S. Sikander (Dead) By LRs. v. K. Subramani (supra) and A. Kanthamani v. Nasreen Ahmed (supra) has been deliberated upon. In R. Kandasamy (Since Dead) v. T. R. K. Sarawathy (supra), it has been clarified that the appellate court would not be precluded from examining whether the jurisdictional fact exists for grant of relief of specific performance, notwithstanding the fact that the trial Court omitted or failed to frame an issue on maintainability of the suit [... ] 26. Since in the present case, the seller had issued a letter dated 07th February, 2008 cancelling the agreement to sell prior to the institution of the suit, the same constitutes a jurisdictional fact as till the said cancellation is set aside, the respondent is not entitled to the relief of specific performance. 27.

Consequently, this Court is of the opinion that absent a prayer for declaratory relief that termination/cancellation of the agreement is bad in law, a suit for specific performance is not maintainable. " (Emphasis Supplied) 33. Before delving into the discussion of whether decisions of this Court in I. S. Sikander (supra) and Sangita Sinha (supra) would be of any help to subsequent purchasers herein, we deem it necessary to look into the views adopted by various High Courts with respect to the issue at hand. (a) Views adopted by the High Courts on failure to seek declaration. 34. The Punjab and Haryana High Court in Brahm Dutt v. Sarabjit Singh, reported in 2017 SCC OnLine P&H 5489, had observed that unilateral cancellation by one party is impermissible in law except in cases where the agreement itself is determinable under Section 14 70 of the Specific Relief Act, 1963 (for short, "the Act of 1963").

As per the court, to hold otherwise would have enabled a defendant to frustrate virtually every suit for specific performance by resorting to unilateral cancellation. The court emphasized that the Act of 1963 had made elaborate provisions on this aspect under Chapter IV i. e. , where a party seeks to rescind an agreement to sell, it is incumbent upon such party to approach the court and obtain a declaration as to the validity of such revocation or rescission. If a party claims that he had valid reasons to terminate or rescind the contract, then such terminating party should seek a declaration from the competent court, as required under Sections 27 and 31 of the Act of 1963 respectively. Therefore, in such a situation, the burden to seek a declaration regarding the validity of cancellation or termination of the contract would rest upon the defendant, who has raised such termination as a defence to resist the suit for specific performance, and not upon the plaintiff.

The relevant observation is as under: "17. However, otherwise also the defendant could not have, unilaterally, cancelled the agreement in question. Unilateral cancellation of agreement to sell by one party is not permissible in law except where the agreement is determinable in terms of Section 14 of this Specific Relief Act. Such cancellation cannot be raised as a defence in a suit for specific performance. If any such a plea of cancellation/termination is raised by the defendant than the Court can just ignore this and the plaintiff need not challenge such an alleged cancellation. If such unilateral cancellation of non-determinable agreement is permitted as a defence then virtually every suit for specific performance can be frustrated by the defendant. Therefore the Specific Reliefs Act has made detailed provisions for this aspect.

The bare perusal of the provisions of the Specific Relief Act shows that once a party claims the right of revocation or rescission, of the agreement then such a party is required to seek a declaration from the Court regarding the validity of revocation or rescission, as the case may be. In the present case also, it was not the duty cast upon the plaintiff to challenge the alleged cancellation of agreement, which, otherwise also, is not proved on record. On the contrary, if the defendant so claimed that he had valid reasons to K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other terminate the contract or rescind the contract then he should have sought a declaration from the competent Court, as required under Sections 27 and 31 of Specific Relief Act. Hence the plea of termination of agreement raised by the defendant has rightly not been accepted by the Courts below. 18.

So far as the judgment of the Hon'ble Supreme Court in case of I. S. Sikandar (supra) is concerned, there is no dispute regarding the proposition laid down by the Hon'ble Supreme Court. However, that judgment is distinguishable on the facts of the present case. In the case before the Hon'ble Supreme Court, the defendant had, in fact, asked the plaintiff to make the payment of the money and to get the sale deed executed. On failure of the plaintiff to make the payment the agreement had become determinable and the defendant had terminated the contract by specific communication. This action of the defendant was within the realm of the Contract Act, as provided under Sections 38 and 51 of the Contract Act and Section 14 of Specific Relief Act, which provides that in case of the performance which was required of the plaintiff/promisee is refused by him then the defendant/promisor need not perform his part of the agreement. " (Emphasis Supplied) 35.

The view taken in Brahm Dutt (supra) stood affirmed by this Court in Brahm Dutt v. Sarabjit Singh, reported in 2018 SCC Online SC 3961, wherein this Court found no good reason to interfere with the view taken by the High court. The relevant portion of the order is as under: "3. We do not find any ground to interfere with the impugned order. The special leave petition is, accordingly, dismissed. " 36. Later, in Balwinder Sarpal v. Ram Kumar Bansal, reported in 2022 SCC OnLine P&H 4408, the Punjab and Haryana High Court was again confronted with a suit for possession by way of specific performance. The case arose out of an agreement for sale where the total sale consideration was fixed at Rs. 7,00,000/-, of which Rs. 1,00,000/- was paid as earnest money, and the sale deed 72 was to be executed on 05. 07. 2006 upon payment of the balance consideration.

On the appointed date, the plaintiff remained present in the office of the Sub-Registrar with the requisite balance sale consideration, for the purpose of execution and registration of the sale deed. The defendants, however, failed to appear and the sale deed could not be executed, thereby compelling the plaintiff to institute the suit. The trial court noted that under a notice of termination, the defendants purported to cancel the agreement and forfeit the earnest money. Thus, the trial court, relying on the termination notice, held that the agreement stood terminated and the earnest money stood forfeited, and that in the absence of any declaratory relief sought, the suit for specific performance was not maintainable. Aggrieved by the decision of the trial court, the plaintiff preferred an appeal which came to be allowed and thus, the suit for specific performance was decreed in favour of plaintiff. In second appeal, the defendants placed reliance upon I. S.

Sikandar(supra) to contend that, since the plaintiff had not sought a declaration challenging the termination, the suit was not maintainable. The High court, however, distinguished I. S. Sikandar(supra). It was observed that in I. S. Sikandar(supra), the vendor had called upon the purchaser to complete the transaction by paying the balance sale consideration, and even afforded him a further opportunity with a caveat that failure would result in termination. The purchaser defaulted despite such opportunity, and in such circumstances, this Court upheld the termination. In other words, it was under such circumstances that the failure to seek a declaration that the termination was unilateral and void, was considered to be detrimental to the suit for specific performance instituted by the plaintiff therein.

By contrast, in Balwinder Sarpal (supra), the defendants had issued the notice of termination within five days of the stipulated date, without granting any opportunity to the plaintiff to tender the balance consideration and get the sale deed executed. On these distinguishing facts, the High court held that I. S. Sikandar(supra) could not be applied to the case at hand. Instead, reliance was placed on Brahm Dutt(supra) to hold that a unilateral termination of an agreement for sale, effected in such manner, is not permissible. The High court observed that once it was found that the termination was unilateral and without giving any opportunity to the purchaser to perform his part of the contract, no separate declaratory relief was required with respect to the termination. The relevant observation is as under: K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other "9.

In the present facts and circumstances wherein, the agreement in question is dated 05. 04. 2006 with 05. 07. 2006 being the target date, notice dated 10. 07. 2006 regarding its termination and forfeiture of earnest money was issued on 10. 07. 2006 whereas the suit for possession by way of specific performance came to be filed at the instance of respondent-plaintiff on 17. 08. 2006 i. e. without causing any delay what so ever. This itself shows that in fact the respondent/plaintiff was always ready and willing to perform his part of agreement and the amazing swiftness shown by the appellants/defendants was not at all bona fide and the uncalled for. Before terminating the agreement in question, the appellant/defendant never called upon the respondent/plaintiff to come forward and execute the sale deed in pursuance to the agreement in question which happens to be the most relevant distinguishing factor as compared to the facts in the case of I. S. Sikandar (D) By LRs. v. K.

Subramani, (2014) 1 RCR (Civil) 236. To point out the same, relevant portion from paragraph No. 17 of the aforesaid judgment is reproduced as under:-- "............. The period of five months stipulated under clause 6 of the Agreement of Sale for execution and registration of the sale deed in favour of the plaintiff had expired. Despite the same, the defendant Nos. 1-4 got issued legal notice dated 06. 03. 1985 to the plaintiff pointing out that he has failed to perform his part of the contract in terms of the Agreement of Sale by not paying balance sale consideration to them and getting the sale deed executed in his favour and called upon him to pay the balance sale consideration and get the sale deed executed on or before 18. 3. 1985. The plaintiff had issued reply letter dated 16. 3. 1985 to the advocates of defendant Nos. 1-4, in which he had admitted his default in performing his part of contract and prayed time till 23. 05. 1985 to get the sale deed executed in his favour.

Another legal notice dated 28. 03. 1985 was sent by the first defendant to the plaintiff extending time to the plaintiff asking him to pay the sale consideration 74 amount and get the sale deed executed on or before 10. 04. 1985, and on failure to comply with the same, the Agreement of Sale dated 25. 12. 1983 would be terminated since the plaintiff did not avail the time extended to him by defendant Nos. 1-4. Since the plaintiff did not perform his part of contract within the extended period in the legal notice referred to supra, the Agreement of Sale was terminated as per notice dated 28. 03. 1985 and thus, there is termination of the Agreement of Sale between the plaintiff and defendant Nos. 1-4 w. e. f. 10. 04. 1985. As could be seen from the prayer sought for in the original suit, the plaintiff has not sought for declaratory relief to declare the termination of Agreement of Sale as bad in law.

In the absence of such prayer by the plaintiff the original suit filed by him before the trial court for grant of decree for specific performance in respect of the suit schedule property on the basis of Agreement of Sale and consequential relief of decree for permanent injunction is not maintainable in law.......... ". 10. From the portion reproduced hereinabove, it can be easily traced out that in the case of I. S. Sikandar (Supra), the purchaser was initially called upon by the vendor to get the sale deed executed on payment of balance sale consideration. The purchaser having failed to do so, another opportunity was even granted to him to perform his part of the agreement with a caveat that in case the purchaser failed to do so by the stipulated date, the agreement would stand terminated. It was under those circumstances, when the purchaser failed to perform his part of obligation under the agreement, the Hon'ble Supreme Court accepted the plea of termination of the agreement.

On the contrary, in the present case, notice of termination was issued by appellants/defendants merely within 5 days of the target dates and that too without granting any opportunity to the respondent/plaintiff to pay the balance consideration and get the sale deed executed. In these distinguishing circumstances, the judgment passed in the case of I. S. Sakandar (supra) can't be made applicable to the present K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other case. More than that even the unilateral termination of agreement in question could not be accepted, in view of the law laid down by this Court in case of Brahm Dutt v. Sarabjit Singh, 2018 (1) L. A. R. 119 [... ] 11.

Once the alleged termination of agreement in question, in the facts and circumstances of the present case has not been found to be bona fide being done in a unilateral manner without even calling upon the respondent/plaintiff to perform their part of agreement and particularly under the circumstances, wherein, the suit was filed promptly thereafter, no declaration, challenging the alleged termination was called for. " (Emphasis Supplied) 37. In S. K. Ravichandran v. M. Thanapathy, reported in 2022 SCC OnLine Mad 9094, the plaintiff had instituted a suit for specific performance of an agreement for sale of immovable property owned by the defendant. The parties had entered into a written agreement for sale dated 19. 08. 2007 for a total consideration of Rs. 11,80,000/-, out of which the plaintiff paid Rs. 1,50,000/as advance on the very same day. The agreement stipulated that upon payment of the balance consideration of Rs. 10,30,000/- on or before 15. 10.

2007, the sale deed would be executed and registered. The plaintiff tendered the balance consideration and was assured by the defendant that he would attend the office of the Sub-Registrar prior to the stipulated date. It was further agreed that both the parties would appear before the Sub-Registrar on 09. 10. 2007. While the plaintiff duly presented himself on that date, the defendant failed to do so. Consequently, on 12. 10. 2007, the plaintiff dispatched a telegram and a detailed letter requesting the defendant to attend the Sub-Registrar's office on 15. 10. 2007. The plaintiff remained present on the appointed day, but despite due receipt of the communication, the defendant neither appeared nor responded. The plaintiff thereafter learnt that the defendant was attempting to alienate the suit property to third parties, compelling him to institute a suit for specific performance and permanent injunction. The defendant by relying on I. S.

Sikandar (supra) resisted the suit on the ground that, in the absence of a specific challenge to the alleged termination of the agreement, the suit was not maintainable. The plaintiff, on the other hand, contended that the 76 agreement did not contain any clause permitting termination in the event of default, and that unilateral cancellation was impermissible in law. Relying upon the decision in Brahm Dutt(supra), it was urged that unilateral cancellation of a contract, except in cases where the agreement is determinable under Section 14 of the Act of 1963 is not sustainable in the eyes of law. Such a cancellation, if pleaded as a defence, could be ignored by the court and the plaintiff did not require to seek a separate declaratory relief.

Relying on the dictum as laid in Brahm Dutt(supra), the Madras High Court held that since the agreement in question did not provide for termination upon the purchaser's failure to pay the balance consideration by a stipulated date, the unilateral cancellation pleaded by the defendant was of no legal effect. It was reiterated that law does not permit such unilateral termination. The relevant observation is as under: "15. He would further submit that since the appellant did not come forward to get the sale deed by paying balance sale consideration and he was not ready and willing to perform his part of contract, the respondent cancelled the sale agreement and when the respondent communicated the appellant, regarding the cancellation of the deed, the appellant has not challenged the cancellation of the sale agreement. Without challenging the cancellation of the sale agreement, the Suit is not maintainable. 16. In support of his contention, he relied on the following Judgments:-- (i) I. S.

Sikandar (D) by LRS. , v. K. Subramani, (2013) 15 SCC 27; (ii) Ravindran v. Danton Shanmugam, (2017) 3 Mad LJ 265; (iii) Mohinder Kaur v. Sant Paul Singh, (2019) 9 SCC 358 and (iv) Prabakaran v. Geetha, (2022) 3 CTC 650. xxx xxx xxx 25. It is the contention of the learned counsel for the respondent that the suit itself was not maintainable on the ground that though the respondent cancelled the agreement, the appellant has not challenged the cancellation. In this regard, the learned counsel for the appellant would submit that the sale agreement does not speak about the termination of the contract. Unilateral cancellation is not permissible under law, except where K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other the agreement is determinable in terms of Section 14 of the Specific Relief Act. Such cancellation cannot be raised as a defence in a suit for specific performance.

If any such plea is raised by the respondent, the Court can just ignore the same and the plaintiff need not challenge the unilateral cancellation separately. Further, the plea regarding the maintainability of the suit is to be raised at the first instance in the written statement. Therefore, the said plea cannot be adjudicated in the appeal. The citation referred to by the learned counsel for the respondent is not applicable to the present case on hand. 26. A careful perusal of the sale agreement Ex. A. 1 clearly shows that the time stipulated for the balance sale consideration is on or before 15. 10. 2007, it does not speak about the termination of the contract, in case the appellant will not pay the balance sale consideration on particular date. Therefore, the law does not permit unilateral cancellation as referred to above. " (Emphasis Supplied) 38. The view taken by the Madras High Court in S. K. Ravichandran (supra) also came to be affirmed by this Court in S. K. Ravichandran v.

M. Thanapathy, reported in 2022 SCC Online SC 2369, wherein one of us, J. B. Pardiwala, J. , was a part of the Bench. This Court found no good reason to interfere with the above decision. The relevant portion is as under: "2. We do not find any reason to interfere with the impugned order. The Special Leave Petition is accordingly dismissed. " 39. The Delhi High Court was also seized of a similar issue in the case of Rajesh Sethi S. C. v. P. C. Sethi, reported in 2023 SCC OnLine Del 7010. In the said case, the plaintiff had filed a suit for specific performanceof agreement to sell. The agreement to sell was terminated by the defendants on the ground that the property was an HUF property. The High court observed that such unilateral termination is not permissible under law, especially when the defendant vendor neither had any valid reason nor had filed any suit seeking a declaration that the agreement to sell was void.

Thus, the plea that the agreement to sell was unilaterally terminated by the 78 defendant vendor as the suit property was an HUF property is not valid. The relevant observation is as under: "145. The question which now needs deliberation is whether the Agreement to Sell dated 14. 01. 2004 Ex P-1/D-2 had been validly terminated by Col. P. C. Sethi vide his Letter dated 21. 03. 2004, before the expiry of the three month period for execution as provided in the said Agreement. 146. To evaluate the validity of a unilateral rescission of a contract it would be apposite to refer to the judgment of the Madras High Court in Raja Rajeswara Dorai v. A. L. A. R. R. M.

Arunachellan Chettiar, 1913 SCC OnLine Mad 276 where it was observed that a unilateral expression of rescission of a contract by one of the parties to the contact cannot be held to relieve him from his obligation to have the contract rescinded by Court under the substantive law and within the time allowed by statutory law if he wants as a plaintiff the assistance of the Court in obtaining certain reliefs on the basis that the contract has ceased to exist. It was observed that repudiation of a contract by one party alone cannot get the party any relief except as consequent of getting a declaration and a rescission by the Court. Thus, a contract can be properly rescinded without the intervention of a Court only by the act of both parties or, if the original contract or Deed itself, by clauses of forfeiture or similar clauses, puts an end to the contract or transaction.

However, even the latter case has to be determined by both the parties and only then the aid of the Court is not required. Therefore, even though a contract or transaction may be voidable at the instance of one party, its rescission is effectuated, not by the mere repudiation of one party, but by the decree of declaration of this Court. 147. It has been further explained by Punjab and Haryana High Court in the case of Brahm Dutt v. Sarabjit Singh, 2017 SCC OnLine P&H 5489 that unilateral cancellation of Agreement to Sell by one party is not permissible in law except where the agreement is determinable in terms of Section 14 of this Specific Relief Act, 1963 and such K. S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa Batil, Since Deceased by His Lrs and Other cancellation cannot be raised as a defense in a suit for Specific Performance.

If any such plea of cancellation/ termination is raised by the defendant, the Court can just ignore the same and the plaintiff is also not required to challenge such a cancellation or revocation. It was further observed that if such unilateral cance