Punjab & Haryana High Court Upholds Specific Performance but Enhances Consideration to Reflect Three-Decade Delay and Escalation in Land Value

Case Name: Sunder Lal and Others vs. Cholar Ram
Date of Judgment: 20 November 2025
Citation: RSA-2957-1996
Bench: Hon’ble Mr. Justice Deepak Gupta

Held: The Punjab and Haryana High Court dismissed the Regular Second Appeal and upheld the concurrent decrees of specific performance passed by the trial court and the first appellate court. The Court held that the agreement to sell dated 28.05.1990 was duly proved, the purchaser had consistently demonstrated readiness and willingness, and the seller had actively attempted to defeat the contract by suffering a collusive decree in favour of his sons. However, invoking its equitable jurisdiction, the Court modified the decree by directing the purchaser to pay substantially enhanced consideration in view of the extraordinary delay of more than thirty years and the steep rise in land value since 1990. The Court ruled that enforcing the contract strictly at the original price would amount to an unfair windfall for the purchaser and corresponding injustice to the seller, and therefore moulded relief under Section 20 of the Specific Relief Act (pre-amendment).

Summary: The dispute arose from an agreement to sell agricultural land whereby the seller agreed to transfer his half share for ₹1,92,540/-, receiving ₹25,000/- as earnest money. The purchaser asserted continuous readiness and willingness, while the seller denied execution and claimed the land was ancestral. Evidence showed that the agreement was typed and signed in the presence of witnesses, consideration was paid, and the seller had earlier admitted execution in written pleadings filed in related proceedings. The Court found that the seller later retracted this admission and adopted inconsistent stands to evade his contractual obligations.

The trial court decreed specific performance, finding the agreement genuine and enforceable and the consent decree obtained by the seller in favour of his sons to be collusive. The first appellate court upheld the decree.

In second appeal, the seller challenged execution of the agreement, the purchaser’s readiness and willingness, maintainability under Order II Rule 2 CPC, and argued that only double earnest money should be awarded. The High Court rejected these arguments. It held that the purchaser had acted diligently by filing an injunction suit to protect the property, then promptly filing the suit for specific performance upon discovering the collusive decree. The Court further held that the subsequent suit rested on a distinct cause of action and was not barred. The purchaser’s conduct and testimony established readiness and willingness, and discrepancies regarding the scribe or place of typing were immaterial. The Court also held that the clause permitting refund of double earnest money did not bar specific performance.

Considering that more than three decades had passed, and that the escalation in land value would render the 1990 price wholly inequitable, the Court applied Supreme Court precedents permitting modification of relief where enforcement at original price would cause undue hardship or confer an unjust gain.

Decision: The appeal was dismissed. The High Court affirmed the decree of specific performance but modified its terms by directing the purchaser to deposit an enhanced amount of ₹1,17,27,800/- — representing a proportionately increased consideration to balance equities. Upon such deposit, the seller or his legal representatives must execute the sale deed within the stipulated time, failing which execution through court process would be permitted. If the purchaser fails to deposit the amount within three months, the decree for specific performance will stand vacated and the purchaser will instead be entitled only to refund of double the earnest money with interest.