Author: Dhruv Khurana, student at ICFAI Law School, Hyderabad.
Citation: (2018) 2 SCC 284
Date: 10 January 2018
Bench: Ashok Bhushan and A Sikri
Original copy: View
Issue in Question:
- Whether the plaintiff was entitled to receive the damages in the land procurement proceedings or was he entitled only to receive the refund of the earnest money?
Background of the Case:
- The legal representatives of the plaintiff filed a civil appeal against the judgement of the High Court of Himachal Pradesh and that appeal was made by the respondent of the present case.
- In the previous judgements, the High Court of Himachal Pradesh and the other courts ordered to pay Rs 90,000/- with the 9% rate of interest from the date of filing the suit to perform the specific performance of the contract as provided under the Specific Relief Act to the appellants.
- A sale agreement was entered in favour of Krishan Lal on 19th April 1989. He was related to the appellant and sold 5/16 share, which was 02257 hectares of land, for the amount of Rs 90,000/-. The respondent nos. 2 to 6 secured the amount of Rs. 90,000/- and they transferred the property to the plaintiff. The plaintiff built three shops on the property after he got its possession but, respondent no. 1 got the property through the execution of the gift deed carried out by respondent nos. 2 to 6 on 8th July 1991.
- The respondent no. 6 filed a civil appeal in the trial court but it got rejected by the primary appellate court on the date of 17th December 2001. While the case was pending, a notification was passed by the High Court under Section 4 of The Land Acquisition Act, 1894 on 22nd December 2005 and issued the acquisition of the land mentioned in the suit. A sum of money was provided to respondent no. 6 on 10th May 2008 and land with shops built on it was also given to him. The respondent no. 6 filed an appeal before High Court that the land was acquired when the second appeal was pending and the procedure of specific performance of contract was maintained by them
- The Defendant no. 6’s submission was allowed by the High Court by changing the decree and ordered respondent nos. 2 to 6 to pay a total amount of Rs. 90000/- to the plaintiff with 9% rate of interest per annum. The plaintiff filed an appeal in court after not being satisfied by this judgement.
- The Supreme Court of India looked into the scope and details of the Section 21 of the Specific Relief Act. The court stated that the contract between the parties had become void, under Section 21 of the Specific Relief Act. There was no fault of the appellant so the court allowed to award damages in regard to this act. If the appellant did not complete its specific performance then the court would not allow the appellant to seek damages according to Section 21 of the Specific Relief Act.
- The Supreme Court of India referred to the case of Jagdish Singh V. Nathu Singh, for the context of Section 21 of Specific Relief Act, this case had similar facts as the present case, the suit was dismissed by the trial court as well as by the first appellate court. However, when the case was taken into the High Court the judgement was reversed. In the present case also the proceedings of the mandatory acquisition of land was taken, when the second appeal was pending in the High Court and was acquired.
- In this case the amount of damages was evaluated and that is important for the determination of the price of land in the market for the land acquisition proceedings.
- The Supreme Court held that out of the compensation received after the acquisition of the suit land, a compensation of Rs. 10 lakhs should be granted to the appellants and the defendant nos. 1 to 5 should get the amount from the remainder of the compensation that was left from the compensation of Rs. 10 lakhs.
- Moreover, it was also stated that respondent nos. 2 to 6 were to be given compensation if the compensation was not yet disbursed. Respondent no. 1 would return the compensation of Rs. 10 lakhs to the appellants and would give to the respondent nos. 2 to 6, if the compensation was by the defendants no. 6.