Can the court declare the compromise decree invalid if consideration for the alleged compromise was inadequate and there was variance between the agreement and compromise petition?

 

We shall now look into the circumstances, as highlighted by the learned Senior Counsel appearing for the Defendant No. 2, rendering the settlement agreement dated 28.03.1991 invalid and not binding Under Order XXIII Rule 3 of the Code of Civil Procedure:

First, the alleged compromise agreement has admittedly not been signed by the Plaintiff who concededly has a share in the property as a coparcener. A written consent of all parties is necessary.

Secondly, a coparcenary undivided property in specie (Plot No. 140) has been allotted to Defendant 2 by Defendant No. 1 over which the Plaintiff also has an interest.

Thirdly, there is variance between the agreement and the compromise petition producing the agreement.

The Variance noted is as follows-

(a) The compromise petition takes in consideration yet another property already purchased by Defendant No. 2 by her own income (Schedule B property) which was not a part of compromise agreement.

(b) The sketch map appended to the petition shows plot No. 1086 and 1085 which for part of plot No. 141 instead of plot No. 140 mentioned in Clause 3 of compromise agreement, and does not indicate any consensus ad idem, therefore, the execution of the compromise agreement becomes unenforceable.

(c) The species of suit property, which was given/provided to Defendant No. 2 in Clause 3 (page 141) of agreement was changed to will be allotted to her in final decree proceeding.

(d) The payment of Rs. 12000 which was to be deposited to court without any caveat in agreement (See para 4 @ 141) was made subject to further orders of the Court in the petition.

(e) There is no express mentioning about the mesne profits in agreement whereas a definite Clause was inserted in the compromise petition.

(f) The easement rights to property of Defendant No. 2 were recognised in agreement and later in petition was altered to that Defendant No. 2 along with others have to file and take steps to easement rights for which the Defendant 1 shall not object.

(h) The agreement provided that the Defendant No. 2 shall sign the compromise petition which was later altered to signing and swearing the affidavit in compromise petition.

Fourthly, the judgment dated 01.08.2000 of the first appellate court accepting the compromise does not make allotment of the property allotted in specie to the Defendant No. 2. The first appellate court has proceeded on the wrong premise that the Defendant No. 2 has surrendered her rights to the Defendant No. 1. The first appellate court was further wrong in specifically noting that the compromise agreement does not cause any prejudice to the rights of the Plaintiff and therefore can be given effect.

Fifthly, the compromise agreement was entered into by beckoning a smaller share to the Defendant No. 2, while she has a larger share in view of Vineeta Sharma (supra). The consideration for the alleged compromise/settlement was therefore inadequate and whole agreement has to fall to the ground due to changed and supervening circumstances effectuated by change in law. {Para 92}

IN THE SUPREME COURT OF INDIA

Civil Appeal Nos. 2913-2915 of 2018

Prasanta Kumar Sahoo and Ors.  Vs.  Charulata Sahu and Ors.

Hon'ble Judges/Coram:

A.S. Bopanna and J.B. Pardiwala, JJ.

Author: J.B. Pardiwala, J.

Decided On: 29.03.2023

Citation: MANU/SC/0326/2023.

Read full Judgment here: Click here

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Can the court declare the sale deed void on the grounds of want of consideration if the sale deed records that consideration was paid?

 Now, coming back to the case in hand, both the sale deeds record that the consideration has been paid. That is the specific case of the respondents. It is the specific case made out in the plaints as originally filed that the sale deeds are void as the same are without consideration. It is pleaded that the same are sham as the purchasers who were minor sons and wife of Sudarshan Kumar had no earning capacity. No evidence was adduced by Sudarshan Kumar about the payment of the price mentioned in the sale deeds as well as the earning capacity at the relevant time of his wife and minor sons. Hence, the sale deeds will have to be held as void being executed without consideration. Hence, the sale deeds did not affect in any manner one half share of the appellant in the suit properties. In fact, such a transaction made by Sudarshan Kumar of selling the suit properties on the basis of the power of attorney of the appellant to his own wife and minor sons is a sham transaction. Thus, the sale deeds of 10th April 1981 will not confer any right, title and interest on Sudarshan Kumar’s wife and children as the sale deeds will have to be ignored being void. It was not necessary for the appellant to specifically claim a declaration as regards the sale deeds by way of amendment to the plaint. The reason being that there were specific pleadings in the plaints as originally filed that the sale deeds were void. A document which is void need not be challenged by claiming a declaration as the said plea can be set up and proved even in collateral proceedings.

Hence, the issue of bar of limitation of the prayers for declaration incorporated by way of an amendment does not arise at all. The additional submissions made by the respondents on 16th November 2021 have no relevance at all. {Para 16}

Supreme Court

JUSTICE AJAY RASTOGI JUSTICE ABHAY S. OKA

KEWAL KRISHAN Vs. RAJESH KUMAR & ORS. ETC.

CIVIL APPEAL NOS. 6989-6992 OF 2021

22nd November 2021

Citation: 2021 ALL SCR (ONLINE) 678

Author: ABHAY S. OKA, J.

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Whether landlord can seek eviction decree if tenant has subletted tenanted premises without consideration?

Even otherwise it was pointed out on behalf of the respondents that the eviction does not follow a finding of sub-letting in stricto sensu. It follows the finding that there is an illegal transfer in any other manner. The words "transferred in any other manner" in Section 13(1)(e) has been considered widely and will include gratuitous transfer and transfer without consideration. The Gujarat High Court in Sheth Jivaji Rajbhai & Sons v. Patel Hatimbhai Nazarali 1999 Bom.R.C. 409 has observed in para. 17 as follows:

17. In my view, the words `transfer in any other manner' in Section 13(1)(e) are definitely wider and such transfer will include gratuitous transfer and transfer without consideration. Consequently, if landlord places reliance upon the transfer or assigned tenancy rights by tenant-in-chief in other manner he need not prove existence of valuable consideration for such transfer as is required to be proved for illegal sub-letting. Thus, the trial Court was justified in decreeing the suit on grounds of illegal assignment or transfer of interest in the tenancy by tenant-in-chief to the defendant No. 2.

IN THE HIGH COURT OF BOMBAY

Writ Petition No. 3221 of 2001

Decided On: 04.10.2007

 Vijay K. Gupta Vs. Nalini Varjeevandas Shah and Ors.

Hon'ble Judges/Coram:

S.A. Bobde, J.

Citation: 2008(2) MHLJ 24

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What is difference between advance amount and earnest amount?

 Difference between 'advance amount' and the 'earnest money' has been considered by the Supreme Court in number of cases. In Shree Hanuman Cotton Mills v. Tata Air-Craft Ltd. MANU/SC/0086/1969 : (1969) 3 SCC 522 : (AIR 1970 SC 1986) the Supreme Court laid down certain principles to determine as to when the amount paid as 'advance' be treated as 'earnest money' and the seller is entitled to forfeit the same. Para 21 of the judgment is reproduced hereunder. "21. From a review of the decisions cited above, the following principles emerge regarding 'earnest':

(1) It must be given at the moment at which the contract is concluded.

(2) It represents a guarantee that the contract will be fulfilled or, in other words, 'earnest' is given to bind the contract.

(3) It is part of the purchase price when the transaction is carried out.

(4) It is forfeited when the transaction falls through by reason of the default or failure of the purchaser.

(5) Unless there is anything to the contrary in the terms of the contract, on default committed by the buyer, the seller is entitled to forfeit the earnest.

10. In the matter of DDA v. Grihsthapana Coop. Group Housing Society Ltd., MANU/SC/0247/1995 : 1995 Supplementary (1) SCC 751 : (AIR 1995 SC 1176) the Supreme Court, following privy council's decision in the matter of Chiranjit Singh v. Har Swamp, MANU/PR/0083/1925 : ATR 1926 PC 1, held that for the question whether the respondents are entitled to forfeit the entire amount, it is to be seen that a specific covenant under the contract was that the respondents are entitled to forfeit the money paid under the contract. So when the contract fell through by the default committed by the appellant, as part of the contract, they are entitled to forfeit the entire amount.

11. In Videocon Properties Ltd. v. Bhalchandra Laboratories MANU/SC/1097/2003 : (2004) 3 SCC 711 : AIR 2004 SC 1787) the Supreme Court examined the nature and character of the earnest money and took a view that the words used in the agreement alone would not be determinative of the character of the "earnest money" but really the intention of the parties and surrounding circumstances. It held that the earnest money serves two purposes of being part-payment of the purchase money and security for the performance of the contract by the party concerned.

12. It is not the description by word used in the agreement only that would be determinative of the character of the sum but really the intention of the party have to be looked into and what may be called as an 'advance money' may really be a deposit or 'earnest money' and what is termed as a deposit or earnest money "may ultimately turn out to be really an advance or part of purchase

13. In Satish Batra (MANU/SC/0887/2012 : 2012 AIR SCW 5869, paras 17 and 18) (supra), the Supreme Court considered the issue and held thus in paragraphs 15 and 16.

15. The law is, therefore, clear that to justify the forfeiture of advance money being part of "earnest money" the terms of the contract should be clear and explicit. Earnest money is paid or given at the time when the contract is entered into and, as a pledge for its due performance by the depositor to be forfeited in case of non-performance, by the depositor. There can be converse situation also that if the seller fails to perform the contract the purchaser can also, get the double the amount, if it is so stipulated. It is also the law that part payment of purchase price cannot be forfeited unless it is a guarantee for the due performance of the contract. In other words, if the payment is made only towards part payment of consideration and not intended as earnest money then the forfeiture clause will not apply.

IN THE HIGH COURT OF CHHATTISGARH

First Appeal No. 316 of 2017

Decided On: 14.09.2018

 Sunil Jain Vs Vishal Ram Sahu

Hon'ble Judges/Coram:

Prashant Kumar Mishra and Vimla Singh Kapoor, JJ.

Citation: AIR 2019 Chhat 37

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Whether mentioning of Rs.5,000/- for purpose of valuation can be said to be consideration received by donor for executing gift deed?

 As there is a serious dispute with regard to
receipt of consideration of Five Thousand Rupees for
executing the gift deed, we have carefully perused the
copy of the gift deed which is placed on record. A

perusal of the gift deed makes it clear that what is
mentioned on the first page of the document, is the
valuation of the property for the purpose of stamp duty
and registration charges which is arrived at Rs.5,000/-,
but not the consideration received by the donor for
executing the gift deed. The gift deed is correctly
interpreted by the Trial Court and the First Appellate
Court. But by misconstruing the same, the High Court has
held that gift was evidenced by a consideration amount
of Rs.5,000/-. It is true that if the gift is evidenced
by consideration,same cannot be valid one within the
meaning of Section 122 of the T.P. Act. But it is clear
from the document itself that no consideration is
passed on as per the registered gift deed. Mentioning of
Rs.5,000/- in the first page, for the purpose of
valuation, cannot be said to be a consideration received
by the donor for executing the gift deed.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 2361 OF 2019
[Arising out of S.L.P.(C) No.36299 of 2016]

Jagdish Chander  Vs Satish Chander And Ors.
Dated:February 27, 2019

R. Subhash Reddy, J.

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What are necessary conditions for drawing presumption U/S 90 of Evidence Act?

 This Court in Paramesh Sarmah & Ors. Vs. Islamali & Ors. (supra), held in para-9 as under:

"9. The condition on which the execution of a document may presume for:-

'(1) That it must have been existed for 30 years or more; (2) It must be produced in court from proper custody. (3) The document must be in appearance free from suspicion and doubt; (4) It must be in a handwriting of a person and should not be anonymous. Generally there is no presumption about recitals in ancient document, but in special circumstances a recital of consideration, legal necessity, etc., may be presumed under S. 90...................."

23. In Bipin Ch. Kalita Vs. Sarama Kalita & Ors. (supra), this court in para-21 held as under:

"The gravamen of the authorities referred to above, is that the presumption comprehend in Section 90 of the Act, is relatable to the writings, execution and the attestation of the document, the contents thereof, being subject to proof in accordance with law. Unerringly, the approach of a court in the matter of presumption under Section 90 of the Act has to be essentially to effectuate the purpose thereof and not to render it nugatory. Though, a court is endowed with a discretion to draw a presumption as enumerated in the section, the exercise thereof, has to be informed with objectivity to further the legislative intendment. Unless, the attending facts and circumstances on the face of the document renders its existence, execution and attestation impossible, a rebuttable presumption is raised in favour of the genuineness and authenticity thereof, casting a burden on the other side to establish the contrary."

IN THE HIGH COURT OF GAUHATI

RSA 107/2014

Decided On: 18.07.2018

 Nepurjan Bibi Choudhury Vs. Musabbir Ali Choudhury and Ors.

Hon'ble Judges/Coram:

Mir Alfaz Ali, J.

Citation: AIR 2018 Gauhati 151

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What constitute consideration for passing of compromise decree?

 Section 2(d) of the Indian Contract Act, 1872 defines consideration. It is something done or promised to be done or something not done or something promised not to be done by the promisee at the desire of the promiser. This definition clearly shows that the consideration could be monetary as well as in kind or in the nature of some sacrifice made by the promisee at the desire of the promiser. Having understood the concept of consideration under the Indian Contract Act, now we would have to take a look at the compromise application signed and executed by the parties.

7. It is seen from the compromise application that even though there is no mention in it about payment of price of the suit properly, the deficiency is made up by what is stated in it's paragraph 3(1). Contents of this para disclose that the defendant (applicant-judgment debtor) has shown his readiness to execute the sale deed in respect of 1/4th share out of his 1/3rd share from the property bearing Khasra No. 81/2, RH. No. 46 situated at mouza Isasani. So, this is an act promised to be done by the defendant or the applicant who is the promisee in the instant case. The respondent or the decree holder is the promiser in this case and as seen from the prayer clause, has expressed a desire that in lieu of the promise so given by the promisee, the Court be pleased to grant a compromise judgment and decree as per the terms and conditions mentioned in the application. These mutual acts performed or promised to be performed by both parties from the consideration for what each of the parties to the compromise application has agreed to do in the present case. Therefore, this is not a case wherein one can surely say that the compromise application was devoid of any consideration, as the term is defined in law.

IN THE HIGH COURT OF BOMBAY (NAGPUR BENCH)

Civil Revision Application No. 86 of 2017

Decided On: 13.09.2017

Suresh Daulatrao Wirulkar Vs.  Ganesh Rajaram Bodkhe

Hon'ble Judges/Coram:

S.B. Shukre, J.

Citation: 2018(3) MHLJ 112

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Whether bank can refuse to encash FDR issued without consideration?

Be that as it may, we do not see nor is there any discussion in the orders before us giving the basis on which the second FDR was issued. Assuming the FDR dated 8th March, 1996 was issued to the Appellant fraudulently, it was all the more obligatory on the Respondent-Bank to have taken action against its employees. As far as the Appellant is concerned, the only document that he had in his possession and rightly so was the FDR issued to him by the Respondent-Bank. The Appellant cannot be expected to produce anything more than what is given to him by the Bank which is the FDR receipt itself.

9. Under the circumstances, we are of the view that the State Commission as well as the National Commission were in error in dismissing the complaint filed by the Appellant. Accordingly, we set aside the orders passed by the State Commission as well as the National Commission and restore the order passed by the District Consumer Forum.
IN THE SUPREME COURT OF INDIA

Civil Appeal No. 6850 of 2005

Decided On: 18.01.2017

 Pishora Singh Vs.  Bank of Punjab and Ors.

Hon'ble Judges/Coram:
Madan B. Lokur and Prafulla C. Pant, JJ.

Citation: AIR 2017 SC 2696

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Whether party can plead that no consideration was paid contrary to recital of sale deed?

The main question for determination in this appeal is whether title passed, on the mere execution and registration of the sale-deed in question, or, the intention of the parties was that title would not pass until the full consideration was paid. This question has been considered by this Court in various cases and it is now well-settled that the intention is to be gathered from the sale-deed itself; ' RASIKANANDA MALLICK v. GANGADHAR PANDA' 1 Cut L T 1; 'RADHAMOHAN THAKUR v. BIPIN BEHARI MITRA' 17 Pat 318; 'MD. MURTAZA v. ABDXJL RAHMAN' 27 Pat 122 and 'MOTILAL SAHU V. UGRAH NARAIN SAHU MANU/BH/0071/1950. It has also been laid down in the second case ILR 17 Pat 318 and in the third 27 Pat 122, that though the sale-deed may recite that the consideration has been paid, there is nothing to prevent the parties from adducing evidence to show that the recital is untrue and that in fact the consideration was not paid.

IN THE HIGH COURT OF PATNA

A.F.A.D. No. 1961 of 1948

Decided On: 26.09.1951

Panchoo Sahu

Vs.

Janki Mandar and Ors.

Hon'ble Judges/Coram:

Pandit Lakshami Kant Jha, C.J. and Chatterji, J.

Citation: AIR 1960 Patna 268

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Whether it is necessary for landlord to prove that sub tenancy was created for consideration?

 Sub-tenancy or subletting comes into existence when the tenant gives up possession of the tenanted accommodation, wholly or in part, and puts another person in exclusive possession thereof. This arrangement comes about obviously under a mutual agreement of understanding between the tenant and the person to whom the possession is so delivered. In this process, the landlord is kept out of the scene. Rather, the scene is enacted behind the back of the landlord, concealing the overacts and transferring possession clandestinely to a person who is an utter stranger to the landlord, in the sense that the landlord had not let out the premises to that person nor had he allowed or consented to his entering into possession over the demised property. It is the actual, physical and exclusive possession of that person, instead of the tenant, which ultimately reveals to the landlord that the tenant to whom the property was let out has put some other person into possession of that property. In such a situation, it would be difficult for the landlord to prove, by direct evidence, the contract or agreement or understanding between the tenant and the sub-tenant. It would also be difficult for the landlord to prove, by direct evidence, that the person to whom the property had been sublet had paid monetary consideration to the tenant. Payment of rent, undoubtedly, is an essential element of lease or sub-lease. It may be paid in cash or in kind or may have been paid or promised to be paid. It may have been paid in lump-sum in advance covering the period for which the premises is let out or sublet or it may have been paid or promised to be paid periodically. Since payment of rent or monetary consideration may have been made secretly, the law does not require such payment to be proved by affirmative evidence and the court is permitted to draw its own inference upon the facts of the case proved at the trial, including the delivery of exclusive possession to infer that the premises were sublet.

IN THE SUPREME COURT OF INDIA

S.L.P. (C) No. 1412 of 1998

Decided On: 05.02.1998

M/s. Bharat Sales Ltd. Vs. Life Insurance Corporation of India

Hon'ble Judges/Coram:

Saiyed Saghir Ahmad and G.B. Pattanaik, JJ.

Citation:JT1998(1) SC753

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What is “Pre-existing duty doctrine”?

 One more doctrine is to be taken into consideration i.e.
“Pre-existing duty doctrine”. It is a principle under the

Contract Act that states that if a party to a contract is under a
pre-existing duty to perform, then no consideration is given for
any modification of the contract and the modification is
therefore voidable. In the 13th edition of the Pollock & Mulla
Indian contract and Specific relief Act in Vol.1, it is mentioned
at page 101 about the Pre-existing obligation under law which
provides that:-
“The performance of what one is already bound to do,
either by general law or by a specific obligation to the
other party, is not a good consideration for a promise;
because such performance is no legal burden to the
promise, but rather relives him of a duty. Neither is
the promise of such performance a consideration,
since it adds nothing to the obligation already
existing.”

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL ORIGINAL JURISDICTION
TRANSFER PETITION (CIVIL) NO. 702 OF 2015
Vennangot Anuradha Samir 
v
Vennangot Mohandas Samir 
Dated;December 02, 2015

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Whether passing of consideration under sale deed can be challenged by third party?

 It is also settled law that passing of consideration under a sale deed cannot be
questioned by third party. Defendant no. 3 has not been able to establish her case that
she is an adopted daughter of the deceased Yashoda and thus, she being the third party,
could not have questioned the execution of the sale deed by Buchamma on the ground of

passing of consideration as rightly laid down by the High Court of M.P. in Pandit
Ramjilal Tiwari v. Vijai Kumar & Ors. 1970 MPLJ 50. The High Court of Patna has also
held that passing of consideration can be questioned by a party or his representative in
Mt. Akli v. Mt. Daho AIR 1928 Patna 44. Similar is the view of the High Court of
Nagpur in Maroti Bansi Teli (supra). Thus, the High Court has erred in law on this

ground also in dismissing the suit.

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 4816 OF 2016

Muddasani Venkata Narsaiah (D) Th. Lrs.
V
Muddasani Sarojana
Citation:(2016) 12 SCC 288

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When court can extend time for deposit of balance consideration in suit for specific performance of contract?

 The   Hon'ble   Supreme   Court   in  Sardar   Mohar   Singh
(supra) has held that under provisions of Section 28(1) of the said
Act, after the decree for specific performance is passed, the Court
does not lose its jurisdiction nor does it become functus officio. Till
the period the sale deed is executed in execution of the decree, the
trial Court retains its powers and jurisdiction to deal with the
decree.  The Court has the power to enlarge the time despite an
application for rescission of the decree being filed by the judgment
debtor.  The prayer for extension of time is distinct from a prayer
for condonation of delay. In the aforesaid case, the delay of about
seven and half years was extended for complying with the decree
of specific performance.
In the light of the aforesaid legal position, if the facts
of   the   present   case   are   considered,   it   can   be   seen   that   the
respondents had applied for certified copy on 7-­1­2-012.  The same
was received on 13­-4­-2012. Immediately thereafter on 19­-4-­2012,
the application for enlargement of time came to be moved.  While

considering this application, the trial Court found that though the
said application was filed under Section 148 of the Code, it would
be treated as an application seeking extension of time to deposit
the balance consideration.   The application was treated as one
filed under Section 28 of the said Act.   In para 21 of its order, the
trial   Court   has   found   the   reasons   mentioned   therein   to   be
justifiable,   bonafide   and   convincing.     If   the   application   for
extension of time  to deposit balance consideration is to be treated
differently from an application for condontation of delay and if
within   a   short   period   from   receiving   certified   copy,   such
application for extension of time had been moved, I do not find
that by accepting the prayer for extension of time the trial Court
acted in any manner contrary to law.  The trial Court not having
become  functus officio  it acted within its jurisdiction in allowing
the application moved by the respondents.
10. Though   the   learned   Counsel   for   the   petitioner   is
justified in submitting that the knowledge of the decree ought to
be   attributed   to   the   parties   on   the   day   the   judgment   is
pronounced, in the facts of the present case when the time of two
months   was   granted   to   make   the   balance   payment   and   the
application for extension was moved within a period of a month
and half thereafter, it cannot be said that in this situation there

was any deliberate delay on the part of the respondents in seeking
extension   of   time   to   deposit   the   balance   consideration.   The
discretion in that regard was rightly exercised by the trial Court
especially when it did not lose seisin of the matter.   The judgment
of the learned Single Judge in Bhujangrao Ganpati (supra) cannot
be relied upon in the light of the subsequent judgment of the
Hon'ble   Supreme   Court   in  Sardar   Mohar   Singh   (supra).   The
judgments   relied   upon   by   the   learned   Senior   Counsel   for   the
respondents support his submissions.

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH : NAGPUR.
WRIT PETITION NO.6716 OF 2015
M/s   Armor's   Developers   Pvt.   Ltd., V  Smt.   Asha   W/o   Rajendra   Paigwar,

           CORAM: A.S. CHANDURKAR, J.
                            DATED:  11th  AUGUST,  2016.
Citation:2017(2) MHLJ 324

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How to prove that doctor had agreed to perform operation of patient?

It has to be seen whether the proposal of the original Plaintiffs was accepted by Defendant No. 1 as the promise. If he accepted the promise, there would be an agreement. The agreement is for treating a patient for consideration. It would, therefore, be an agreement enforceable at law and consequently a contract under Section 2 (h) of the Indian Contract Act, 1872. The acceptance by Defendant No. 1 as the promise has to the absolute and unqualified under Section 7 (1) of the Act and be expressed in some usual and reasonable manner under Section 7 (2) of the Act. The relevant portion of Section 7 which runs thus:

7. Acceptance must be absolute.- In order to convert a proposal into a promise, the acceptance must-
(1) be absolute and unqualified;
(2) be expressed in some usual and reasonable manner...

What is the usual and reasonable manner makes for the acceptance by performance or by implications under Sections 8 & 9 of the Act which run thus :

8. Acceptance by performing conditions, or receiving consideration.- Performance of the conditions of a proposal, or the acceptance of any consideration for a reciprocal promise which may be offered with a proposal, is an acceptance of the proposal.

9. Promises, express and implied.- In so far as the proposal or acceptance of any promise is made in words, the promise is said to be express. Insofar as such proposal or acceptance is made otherwise than in words, the promise is said to be implied.

90. Defendant No. 1 accepted the proposal of the original Plaintiffs in the usual and reasonable manner that surgeons do. Surgeons would not accept only by saying "I will operate" but by actually operating, by aiding and assisting in operation as circumstances require, by charging the fees for the operation, by contriving to fix the operation to accommodate themselves as per their schedule and, of course, by being shown as one such surgeon in the records of the hospital. By all of these modes the contract between the parties in this case must be implied and is demonstrated by performance. It is implied by the patient accepting the surgeon's command to fix the operation at his convenience. It is accepted by the fact that it is fixed on a given day, 5 days after his advice in an O.T. adjoining another O.T.  where he admittedly performed another surgery. It is further implied by the charges that are levied to the patient by way of the surgeon's fees as per the schedule prevailing at the relevant time. It is further manifest in the surgeon actually remaining at the door of the O.T. where he was expected to come as per his implied obligations and where he admittedly conferred with another surgeon to understand the medical position of the patient and to command a further act before walking out.

91. This case falls squarely within the aforesaid Sections denoting an absolute and unqualified acceptance expressed by the usual mode which surgeons reasonably adopt. The acceptance is seen by the consideration sought to be charged for his fees. of course, in this case there is no direct acceptance; it could not be because there was a stiff resistance. Nevertheless the charge was demanded. It was stated to be specifically of Defendant No. 1 and none other in the notices of demand, Exhibits O & P in evidence. The charge of the anesthetist was indeed accepted which was in terms of the schedule of fees depending of the charge of the surgeons. The acceptance was not made in so many words "I will operate"; it was implied in the condescending act of Defendant No. 1 to fix the O.T. coordinated with Defendant No. 2 on the day that would convenience none other than he.

IN THE HIGH COURT OF BOMBAY

Suit No. 1101 of 1989

Decided On: 02.09.2011

 Padam Chandra Singhi and Ors.
Vs.
Dr. P.B. Desai and Ors.

Hon'ble Judges/Coram:
R.S. Dalvi, J.

Citation: 2012(1) ALLMR 510

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Whether plaintiff is entitled to get decree for specific performance of contract if he has only paid 10% of consideration?

 Sub-Section 3 makes it clear that Courts decree specific performance where the plaintiff has done substantial acts in consequence of a contract/agreement to sell. Substantial acts obviously would mean and include payment of substantial amounts of money. Plaintiff may have paid 50% or more of the consideration or having paid a lesser consideration he could be in possession pursuant to the agreement to sell or otherwise is in the possession of the subject property or other substantial acts have been performed by the plaintiff, and acts which can be said to be substantial acts under Section 20(3). However, where the acts are not substantial i.e. merely 5% or 10% etc of the consideration is paid i.e. less than substantial consideration is paid, (and for which a rough benchmark can be taken as 50% of the consideration), and/or plaintiff is not in possession of the subject land, I do not think that the plaintiff is entitled to the discretionary relief of specific performance.

15. The Supreme Court in the recent judgment of Saradamani Kandappan vs. Mrs. S. Rajalakshmi, 2011 (12) SCC 18 has had an occasion to consider the aspect of payment of a nominal advance price by the plaintiff and its effect on the discretion of the Court in granting the discretionary relief of specific performance. Though in the facts of the case before the Supreme Court, it was the buyer who was found guilty of breach of contract, however, in my opinion, the observations of the Supreme Court in the said case are relevant not only because I have found in this case the plaintiff/ buyer guilty of breach of contract, but also because even assuming the plaintiff/buyer is not guilty of breach of contract, yet, Section 20 sub-Section 3 of the Specific Relief Act, 1963 as reproduced above clearly requires substantial acts on behalf of the plaintiff/proposed purchaser i.e. payment of substantial consideration.

Delhi High Court

M/S.A.D. Overseas vs Smt. Sneh Lata Sharma on 8 October, 2012

Author: Valmiki J. Mehta

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Whether plaintiff can be directed to deposit entire consideration at ad interim stage in suit for specific performance of contract?

In the appeal filed by the plaintiff it has been submitted that the Learned Single Judge was in error in granting an injunction subject to the condition that the plaintiff deposits the entire balance of the consideration of Rs. 9.21 Crores. On behalf of the plaintiff it has been submitted that the Learned Single Judge arrived at a conclusion that it was the defendant who had committed prima facie a breach of the agreement of the Memorandum of Understanding dated 3rd April, 2006. In the circumstances, it would be wholly inequitable to direct the plaintiff to deposit the entire balance of the consideration of Rs. 9.21 Crores at the ad interim stage while not enforcing the obligations cast upon the defendant firstly, to obtain a deed of reconveyance of the property which was mortgaged, secondly, to put the plaintiff in possession with a right to construct and develop and thirdly, to complete, the entire transaction against the payment of the balance consideration.

9. We are of the view that there is merit in the submission urged on behalf of plaintiff and to that extent the Appeal of the plaintiff would have to be allowed. As we have already noted, Clause 4(b) of the agreement provided that the payment of the second instalment of Rs. 3.75 Crores was to be made subject to the defendant fulfilling his obligations viz. of obtaining a deed of reconveyance from the mortgagee; and placing the plaintiff in possession of the property with a right to develop and construct thereon. At the ad interim stage, it would in our view be inappropriate to direct the plaintiff to deposit the entire balance of the consideration amount of Rs. 9.21 Crores without the defendant being required to fulfil his part of the remaining obligations. The question of deposit, if any, should, in our view, be more appropriately considered at the hearing of the Notice of Motion. The order of the Learned Single Judge to the extent to which the grant of an ad interim injunction was made conditional on a deposit of Rs. 9.21 Crorog would to the extent of the condition imposed have to be quashpd and set aside.

Bombay High Court

Yusuf Mohamed Lakdawala vs Sudhakar Kashinath Bokade on 11 October, 2007

Equivalent citations: 2008 (2) MhLj 682

Bench: S Kumar, D Chandrachud

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Whether third party can question passing of consideration under a sale deed?

It is also settled law that passing of consideration under a sale deed cannot bequestioned by third party. Defendant no. 3 has not been able to establish her case that
she is an adopted daughter of the deceased Yashoda and thus, she being the third party,
could not have questioned the execution of the sale deed by Buchamma on the ground of

passing of consideration as rightly laid down by the High Court of M.P. in Pandit
Ramjilal Tiwari v. Vijai Kumar & Ors. 1970 MPLJ 50. The High Court of Patna has also
held that passing of consideration can be questioned by a party or his representative in
Mt. Akli v. Mt. Daho AIR 1928 Patna 44. Similar is the view of the High Court of
Nagpur in Maroti Bansi Teli (supra). Thus, the High Court has erred in law on this

ground also in dismissing the suit.

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 4816 OF 2016

Muddasani Venkata Narsaiah Vs  Muddasani Sarojana 

Dated:May 5, 2016.
Arun Mishra, J.
Citation:AIR 2016 SC 2250

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Whether it can be held that cheques were issued as security cheque if liability and consideration is proved?

 The argument that the respondent had no liability to
liquidate the debt owed by Nazimul Islam, has not impressed
us. What is important is whether the cheques were supported
by consideration. Besides the fact that there is a presumption
that a negotiable instrument is supported by consideration
there was no dispute that such a consideration existed in as
much as the cheques were issued in connection with the
discharge of the outstanding liability against Nazimul Islam. At
any rate the endorsement made by the respondent on the
promissory note that the cheques can be presented for
encashment after 25-09-2007 clearly shows that the cheques
issued by him were not ornamental but were meant to be
presented if the amount in question was not paid within the
extended period. The High Court in our view fell in error in
upsetting the conviction recorded by the Courts below who had
correctly analysed the factual situation and applied the law
applicable to the same.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NOS. 82-83 OF 2016

Don Ayengia 
V
The State of Assam & Anr.
Dated;January 28, 2016
T.S. THAKUR, J.

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Whether supplying money to wife for her treatment of breast cancer amount to consideration for dissolution of marriage?

From the above mentioned admitted facts, it is evident
that the petitioner needs sufficient amount of money for the
treatment of breast cancer. Hence, it cannot be ruled out that
in order to save her life by getting money, she agreed for a
settlement of dissolution of marriage. On these facts, a
question that came in our mind is as to whether the Court
would be justified in granting a decree for divorce on the basis
of settlement when the wife is suffering with breast cancer and
is in need of money for her treatment and can that be the
consideration for dissolution of marriage.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL ORIGINAL JURISDICTION
TRANSFER PETITION (CIVIL) NO. 702 OF 2015
Vennangot Anuradha Samir 
v
Vennangot Mohandas Samir 
Dated;December 02, 2015

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Supreme Court: Proper order to be passed in decree for specific performance of contract

A direction of this nature is permissible. It was so held by this Court way back in the year 1954 in Lala Durga Prasad and Anr. v. Lala Deep Chand and Ors. MANU/SC/0008/1953: AIR 1954 SC 75, wherein the learned Judge Vivian Bose J. known for his subtle power of expression and distinctive style of writing while speaking for the bench held as under:

In our opinion, the proper form of decree is to direct specific performance of the contract between the vendor and the Plaintiff and direct the subsequent transferee to join in the conveyance so as to pass on the title which resides in him to the Plaintiff. He does not join in any special covenants made between the Plaintiff and his vendor; all he does is to pass on his title to the Plaintiff. This was the course followed by the Calcutta High Court in Kafiladdin v. Samiraddin MANU/WB/0158/1930 : AIR 1931 Cal 67 and appears to be the English practice. See Fry on Specific Performance, 6^th edition, page 90, paragraph 207; also Potter v. Sanders 67 E.R. 1057. We direct accordingly.

64. We respectfully follow these observations and accordingly uphold the direction issued by the High Court for execution of the sale deed.

65. There is, however, one more aspect of the case which needs to be taken note of and has arisen in the case as a result of passing of the impugned decree in Plaintiff's favour by the High Court and upheld by this Court.

66. The effect of execution of sale deed in Plaintiff's favour by the Defendants in terms of decree would obviously result in cancellation of contract of sale of the suit house between the owner (Defendant No. 2) and subsequent purchaser (Defendant No. 1). The reason is not far to seek.

67. In a contract for sale of immovable property for consideration, if a seller fails to transfer the title to the purchaser, for any reason, on receipt of consideration towards the sale price then a seller has no right to retain the sale consideration to himself and he has to refund the same to the purchaser. When the contract fails then parties to the contract must be restored to their respective original position which existed prior to execution of contract as far as possible provided there is no specific term in the contract to the contrary.

68. The contract between Defendant No. 2 and Defendant No. 1, i.e., owner and subsequent purchaser, stands frustrated due to impugned judgment/decree because now Defendant No. 2 would not be in a position to sell the suit house to Defendant No. 1 though she has received Rs. 4 lacs from Defendant No. 1 for such sale of suit house in her favour. It is for this reason, Defendant No. 2 is liable to refund Rs. 4 lacs to Defendant No. 1.

69. Though this litigation is not between inter se owner and subsequent purchaser of the suit house yet in order to do substantial justice between the parties and to see the end of this long litigation and to prevent a fresh suit being instituted by Defendant No. 1 against Defendant No. 2 for refund of sale consideration which will again take years to decide and lastly when neither it involve any intricate adjudication of facts, nor it is going to cause any prejudice to the parties, we consider it just and proper to invoke our power Under Article 142 of the Constitution of India in the peculiar facts and circumstances of the case as narrated above and accordingly direct Defendant No. 2 (owner of the suit house) to refund Rs. 4 lacs to Defendant No. 1 within three months after execution of sale deed by them in favour of Plaintiff pursuant to the impugned judgment/decree.

Supreme Court of India

Rathnavathi & Anr vs Kavita Ganashamdas on 29 October, 2014

Bench: Fakkir Mohamed Kalifulla, Abhay Manohar Sapre

Citation; (2015)5SCC223,                                                                            

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