Specific Performance Denied Despite ₹1 Crore Payment: P&H High Court Reaffirms Mandatory Proof of Continuous Readiness and Financial Capacity; Restores Trial Court Verdict on ‘Readiness & Willingness’
Case Name: Bimla Devi and Others v. Manoj Kumar Jindal and Another
Date of Judgment: 21.04.2026
Citation: RSA-3627-2025
Bench: Hon’ble Mr. Justice Vikram Aggarwal
Held: The High Court held that mere payment of earnest money is insufficient to grant specific performance unless the plaintiff proves continuous readiness and willingness, including availability of funds, from the date of agreement till decree.
Summary: The dispute arose from an agreement to sell dated 03.04.2017 for land measuring 27 kanals 9 marlas in District Sonepat for ₹2.51 crore. The plaintiff claimed to have paid ₹1.01 crore as earnest money and alleged that he remained ready and willing to perform his part, but the defendants failed to execute the sale deed.
The trial court dismissed the suit, holding that the plaintiff failed to prove readiness and willingness. However, the first appellate court reversed this finding and decreed the suit for specific performance. Aggrieved, the defendants approached the High Court.
The High Court undertook a detailed examination of the evidence and found that although execution of the agreement and payment of ₹1.01 crore were admitted, the plaintiff failed to establish availability of funds for the balance consideration. The Court noted that no details of financial capacity were provided either in the affidavit, legal notice, or evidence.
It further observed that the account statement relied upon by the plaintiff was not properly proved and did not even pertain to him. The Court emphasized that readiness and willingness must be continuous and backed by credible evidence, relying on Supreme Court precedent mandating proof of financial capacity.
The Court also found that the plaintiff’s conduct, including delay in issuing notice and filing suit despite substantial payment, raised doubts regarding his readiness to perform the contract.
Additionally, the Court held that refund of earnest money cannot be granted in absence of a specific prayer in the plaint, reinforcing the requirement under the Specific Relief Act.
Decision: The High Court allowed the second appeal, set aside the judgment of the first appellate court, and restored the trial court’s dismissal of the suit. It declined to grant refund of earnest money due to absence of a specific claim. The matter was also directed to be referred to Income Tax Authorities in view of large cash transactions involved.