Annamalai Vs Vasanthi & Others (Supreme Court of India)
Termination Void When Vendor Accepted Further Payment After Expiry of Period-Specific Performance Restored – Supreme Court
The Supreme Court set aside the Madras High Court’s order that had denied specific performance & directed refund, & restored the first appellate court’s decree for execution of the sale deed in favour of Annamalai
The dispute arose from an agreement to sell dated 08-01-2010 for ₹4.8 lakh, of which ₹4.7 lakh was paid in advance. Subsequently, the vendors (Saraswathi & Dharmalingam) demanded an extra ₹2 lakh; Annamalai paid ₹1.95 lakh on 09-06-2010, duly endorsed on the reverse of the agreement. Despite this, they sold part of the land to their daughter Vasanthi on 17-08-2010 & issued a termination notice on 20-08-2010. The trial court dismissed Annamalai’s suit for specific performance, but the first appellate court decreed it. The High Court reversed that decree, treating time as the essence & doubting the endorsement’s genuineness.
The Supreme Court held that:
- High Court erred in re-appreciating facts under Section 100 CPC, since the first appellate court’s findings were neither perverse nor based on misreading.
- Acceptance of ₹1.95 lakh after expiry of six months amounted to waiver of the right to terminate & proved readiness & willingness of the purchaser.
- Time is not ordinarily essence in immovable-property contracts; by accepting further money, vendors treated the agreement as subsisting.
- Termination after such acceptance was void, & the suit for specific performance was maintainable without separately seeking declaration of invalidity.
- Plaintiff’s claim of possession, even if unproved, did not disentitle him, as over 90% of price was paid & the subsequent purchaser was not bona fide.
Accordingly, the Supreme Court restored the decree for specific performance, directing Annamalai to deposit the balance ₹10,000 within one month.
