1996 INSC 0999
                                                  Pirthi alias Sansi

                                                           Vs

                                                Jati Ram and Others

                            SLPS (C) No. 13659 of 1996 With No. 14275 of 1996

                                      (K. Ramaswamy, G. B. Pattanaik JJ)

                                                      30.07.1996

                                                        ORDER

1. The petitioner, Pirthi @ Sansi admittedly had entered into an agreement on 6-5-1988 to sell 16
kanals 16 marlas of agricultural land for a consideration of Rs. 50,000 per killa and received a sum
of Rs. 24,000 as earnest money. The respondent filed a suit for specific performance in April 1993
against the petitioner. It was his plea and accepted by all courts that he was always ready and willing
to perform his part of the contract and was willing and ready to pay the balance consideration of Rs.
81,000. Accepting the case of the respondent, the trial court decreed the suit. On appeal, the
Additional District Judge by his judgment dated 15-11-1994 reversed the decree holding that
Ramesh and others had come into possession of the land. They were in possession of the land and
the agreement came to be executed in their favour on 5-12-1994 after the judgment of the appellate
court. Therefore, the decree for specific performance was not proper and instead the alternative
relief of recovery and compensation was held appropriate remedy. In second appeal, the High Court
reversed the decree by the impugned judgment dated 15-5-1996 in RSA No. 425 of 1995 and
restored the judgment of the trial court.

2. Shri Mahabir Singh, the learned counsel for the petitioner, contended that consideration of ground
for specific performance is a discretion of the court and the courts granting the decree for specific
performance should exercise the discretion on sound principles of law. The court should grant
alternative relief instead of granting decree for specific performance. In view of the facts that the
petitioner had already inducted the third party in possession and they remained in possession and
also taking possession involves further litigation, the first appellate court rightly refused to grant
specific performance. The High Court committed an error of law in reversing the decree of the first
appellate court. We find no force in the contention. It is an admitted fact that Ramesh and Shashi
Kapoor, Respondents 2 and 3 had come into possession after the suit was instituted and agreement
to sell was entered into. Therefore, the High Court rightly allowed the appeal holding them to be not
bona fide purchasers and directed decree for specific performance in pursuance of agreement to sell
dated 6-5-1988. If the contention of the respondents is given acceptance, no contract can be
enforced and the party will seek to avoid contract by inducting third party into possession.
Therefore, the view taken by the first appellate court in that behalf is clearly illegal. Having regard
to the fact that Respondents 2 and 3 are not bona fide purchasers and admittedly came into
possession after the suit was instituted and the agreement was entered into, the High Court has
rightly rejected their contention. The contention since they have come into possession of the suit for
specific performance will be an impediment in that behalf, bears no force.

3. The special leave petitions are accordingly dismissed.