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PETITIONER: PREM RAJ

       Vs.

RESPONDENT: D.L.F. HOUSING & CONSTRUCTION PVT.  LTD. & ANR.

DATE OF JUDGMENT: 04/04/1968

BENCH: RAMASWAMI, V. BENCH: RAMASWAMI, V. SHAH, J.C.

CITATION:  1968 AIR 1355            1968 SCR  (3) 648  CITATOR INFO :  RF         1981 SC 805  (1)  R          1990 SC 682  (12)

ACT: Practice  and Procedure-Suit for setting aside contract  and prayer,  in  the  alternative, for  a  decree  for  specific performance thereunder-Whether maintainable. Specific Relief Act (1 of 1877), ss. 35 and 37-Scope of. Code  of Civil Procedure (5 of 1908), s.  115(c)  Revisional jurisdiction of High Court.

HEADNOTE: The  appellant find a suit for a declaration that a  certain contract  against him was void and inoperative  having  been obtained  by undue influence, and in the alternative  prayed For  a decree for specific performance of certain  terms  in the  same contract.  The first respondent objected that  the appellant  having  claimed  the agreement  to  be  void  and inoperative  could  not in the same suit pray  for  specific performance of the same agreement.  The trial court rejected the preliminary objection, but the High Court, in  revision, held  that  the appellant could not in  the  alternative  be permitted to sue for specific performance of the  agreement, and therefore the suit must ’fail so far as -the relief  for specific performance was concerned.  Dismissing the  appeal, this Court : HELD : Under 0. 7, r. 7, Civil Procedure Code it is open  to a plaintiff to pray for inconsistent ’reliefs.  But it  must be  shown  by  the  plaintiff that each  of  such  pleas  is maintainable.  So far as the relief of specific  performance is  concerned, the matter must be examined in the  light  of the  provisions of the Specific Relief Act.  Section  37  of the  Act  provides  that  a  plaintiff  suing  for  specific performance  of the contract can alternatively sue  for  the rescission  of  the contract but the converse is  -not  pro- vided.   Section  35 of the Act states the  principles  upon which  the  rescission of a contract may be  adjudged.   But there is no provision in this ,section or any other  section of  the  Act that a plaintiff suing for  rescission  of  the agreement   may   sue  in  the  alternative   for   specific performance.   The omission is deliberate and the  intention of the Act is that no such alternative prayer is open to the

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plaintiff.   It was therefore not open to the  appellant  to sue  for rescission of the agreement and in the  alternative sue for specific performance. [651 C-G] Cawley v. Poole, 71 E.R. 23, applied. Further,  in a suit for specific performance, the  plaintiff should  allege that be is ready and willing to  perform  his part of the contract.  In the present case no such  averment is made in the plaint.  On the other hand, the appellant has alleged  that the agreement was a result of fraud and  undue influence and not binding upon him. [652 D-E] Ardeshir Mama v. Flora Sassoon, 55 I.A. 360, referred to. The  appellant had not made out a cause of action so far  as the  relief of specific performance was concerned and  hence the  appellant was not entitled to be put to  election  with regard to the two alternative reliefs. [653 H] 649 In   holding  that  the  appellant  was  entitled   in   the alternative  to ask for the relief of  specific  performance the  trial  court had committed an error of law and  so  had acted  with  material  irregularity  or  illegality  in  the exercise of its jurisdiction within the meaning of s. 115(c) of the Code of Civil Procedure.  It was therefore  competent to the High Court to interfere, in revision, with the  order of the trial court on’ this point. [1654 B-D]

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 37 of 1966. Appeal  by special leave from the judgment and  order  dated February 14, 1964 of the Punjab High Court, Circuit Bench at Delhi in Civil Revision No. 228-D of 1962. B.   C. Misra and M. V. Goswami, for the appellant. M.   C. Chagla, Daya Krishan, S. C. Javali and Ravinder Narain, for respondent No. 1. The Judgment of the Court was delivered by Ramaswami,  J.-The sole question involved in this appeal  is whether  a plaintiff suing for a declaration that a  certain contract  against  him is void and inoperative  having  been obtained  by  undue influence, can in the same suit  in  the alternative  ask for the relief of specific  performance  of the same contract. On  October  26, 1956 Pt.  Prem Raj, the  appellant  entered into an agreement with Shri Moti Ram Bhalla, respondent  no. 2  for the purchase of lands from Shri Lila Ram,  father  of the  appellant  at the price of Rs. 1025/- perbigha  on  the terms  and  conditions mentioned therein.  On  December  18, 1956,  the  appellant and respondent no. 2  entered  into  a partnership  to carry on the business of buying and  selling lands  and developing, the same under the name and style  of "L.M.G. Colonisers & Traders".  Subsequently, on January  2, 1957  the  said firm "L.M.G. Colonisers &  Traders"  entered into   a   deed  of  partnership  with  D.L.F.   Housing   & Construction (P) Ltd., respondent no.  1 herein to carry  on the  business of purchasing and developing the lands into  a residential 1  colony  and to sell the same in plots  either by  auction  or  by tenders or in any other  manner  as  the company,  respondent no. 1 may find expedient after  getting the  scheme  for  development  approved  by  the   competent authority.  On the same day i.e., January 2, 1957 the  newly formed  partnership between the respondent no. 1 and  L.M.G. Colonisers  &  Traders  entered into an  agreement  for  the purchase  of the same land with Pt.  Lila Ram on  the  terms and  conditions  set  out therein.  On  June  11,  1958  the parties  cancelled the new partnership and  agreement  dated

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January  2,  1957 and entered into a fresh  arrangement  and executed the following four documents 650               "  (1)  A  deed  of  dissolution  of  the  new               partnership  between  L.M.G.  Colonisers   and               Traders  (consisting  of  the  appellant   and               respondent  nos. 2 and I entered into  on  2nd               January 1957 (Ex.  P. I).               (ii)  A  deed of cancellation of agreement  of               sale of land between Lila Ram and the said new               partnership  firm  of  L.M.G.  Colonisers  and               respondent no. 1.               (iii) A  new Agreement of sale of  these  same               lands by Lila Ram in favour of respondent  no.               1.               (iv)  An agreement to sell 22 plots out of the               land  agreed  to be purchased  from  Lila  Ram               under the agreement stated in               (iii)  above by respondent no. 1 in favour  of               the appellant." By  virtue  of  these documents the  new  partnership  dated January 2, 1957 ’between L.M.G. Colonisers & respondent  no. 1 came to an end as also the agreement dated January 2, 1957 by  which Lila Ram had agreed to sell his lands to the  said new partnership firm and there was a fresh agreement by Lila Ram   to  sell  the  same  lands  to  D.L.F.   Housing   and Construction (Private) Ltd., respondent no.  1 at a  certain price and out of the land thus to be bought, respondent  no. I  agreed to sell 22 plots of land to the appellant.   After about 3 years, on or about June 8, 1961, the appellant  gave notice to respondent no. 1 repudiating the arrangement dated June  11, 1958 as void and claimed that the  documents  were not binding upon him.  The appellant alleged that the  deeds executed  on  June,  11, 1958 were  unlawful  and  void  and inoperative against him as they were executed as a result of undue  influence  and coercion exercised upon him.   In  the alternative  the appellant prayed for a decree for  specific performance of the agreement dated June 11, 1958 to sell the aforesaid  22  plots  of land and for  damages  in  addition thereto.    A  preliminary  objection  was  raised  by   the contesting respondent no. 1, D.L.F. Housing and Construction (P)  Ltd.  to the effect that the appellant  having  claimed that  the  agreement  dated  June  11,  1958  was  void  and inoperative,  cannot  in  the same suit  pray  for  specific performance  of the same agreement.  The Subordinate  Judge, First Class, Delhi rejected the preliminary objection by his order  dated February 26, 1962.  Respondent no.  1  filed  a Civil Revision Application no. 228-D of 1962 in the  Circuit Bench of the Punjab High Court at Delhi.  By his order dated February   14,   1964,  Dulat,  J.  allowed   the   Revision Application  holding  that the appellant having sued  for  a declaration  that the agreement of June 11, 1958  was  void, cannot  in the alternative be permitted to sue for  specific performance  of  the agreement and therefore the  suit  must fail  so  far  as the relief for  specific  performance  was concerned. 6 51 This  appeal is brought by special leave from the  order  of the  Punjab  High  Court dated February 14,  1964  in  Civil Revision Application no. 228-D of 1962. In support of this appeal it was argued, in the first place, that under 0.7 r. 7, Civil Procedure Code the appellant  was entitled  to claim a relief in the alternative on the  facts stated- in the plaint and it was open to him to pray to  the Court  that  a  decree for specific  performance  should  be

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granted  if  the  Court did not accept  his  case  that  the impugned agreement dated June 11, 1958 was illegal and void. It is true that under 0. 7, r. 7, Civil Procedure Code it is open  to a plaintiff to pray for inconsistent reliefs.   But it must be shown by the plaintiff that each of such pleas is maintainable.  So far as the relief of specific  performance is  concerned, the matter must be examined in the  light  of the  provisions  of  the  Specific  Relief  Act.   In   this connection  reference may be made to s. 37 of  the  Specific Relief  Act  (Act No. 1 of 1877) which is to  the  following effect :               "A  plaintiff  instituting  a  suit  for   the               specific performance of a contract in  writing               may  pray  in the, alternative  that,  if  the               contract  cannot be specifically enforced,  it               may  be  rescinded  and  delivered  up  to  be               cancelled;  and  the Court, if it  refuses  to               enforce  the contract specifically may  direct               it   to   be  rescinded   and   delivered   up               accordingly." It  is expressly provided by this section that  a  plaintiff suing   for  specific  performance  of  the   contract   can alternatively sue for the rescission of the contract but the converse  is  not provided.  It is therefore not open  to  a plaintiff to sue for rescission of the agreement and in  the alternative sue for specific performance.  Section 35 of the Specific  Relief Act, 1877 states the principles upon  which the rescission of a contract may be adjudged.  But there  is no provision in this section or any other section of the Act that  a plaintiff suing for rescission of the agreement  may sue  in  the alternative for specific performance.   In  our opinion, the omission is deliberate and the intention of the Act  is  that  no such alternative prayer  is  open  to  the plaintiff.  This view is borne out by the following  passage in "Fry on Specific Performance, 6th Edn.’, p. 493" :               "It  remains  to remark  that  the  plaintiff,               bringing   an   action   for   the    specific               performance  of a contract, may claim  in  the               alternative  that, if the contract  cannot  be               enforced, it may be rescinded and delivered up               to be cancelled, provided that the alternative               relief  is based on the same state  of  facts,               ’though with different conclusions as to  law.               When the action is brought by the               652               vendor, and     the  purchaser  has  been   in               possession, this alternative   claim       may               embrace an account of the rents and profits.      Bu t,               for  the reason already stated, a suit to  set               aside  a  transaction  for fraud  or,  in  the               alternative,  for  specific performance  of  a               compromise could not be sustained in the Court               of   Chancery.    And   notwithstanding    the               provisions  of the Rules of the Supreme  Court               as to alternative claims for relief, it  seems               probable that the same conclusion would  still               be  arrived at, on the ground that the  claims               were inconsistent and embarrassing." The  same principle is enunciated in Cawley v.  Poole(1)  in which  it was held by the Court of Chancery that in  a  case where  a  bill alleges a judgment obtained by fraud,  and  a subsequent  compromise,  and seeks to set  aside  the  whole transaction  on the ground of fraud, or in default  to  have the compromise carried out, and the Court is of opinion that

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the case of fraud fails, it will not enforce the compromise, but the whole bill must be dismissed. There is also another reason for holding that the  appellant has made out no cause of action with regard to the relief of specific  performance of the contract.  It  is  well-settled that in a suit for specific performance the plaintiff should allege  that he is ready and willing to perform his part  of the contract.  In the present case, no such averment is made in the plaint.  On the other hand, the plaintiff has alleged that the agreement was a result of fraud and undue influence and was not binding upon him.  For these reasons it must  be held  that so far as the relief of specific  performance  is concerned, the plaintiff has no cause of action.  The  legal position has been stated ’by Lord Blanesburgh in pronouncing the  opinion of the Judicial Committee in Ardeshir  Mama  v. Flora Sassoon(2) as follows :               "Where  the  injured party sued at law  for  a               breach, going, as in the present case, to  the               root  of the contract, he ’thereby elected  to               treat the contract as at an end and himself as               discharged  from its obligations.  No  further               performance by him was either contemplated  or               had  to be tendered.  In a suit  for  specific               performance, on the other hand, he treated and               was  required  by  the  Court  to  treat   the               contract as still subsisting.  He had in  that               suit to allege, and if the fact was traversed,               he   was  required  to  prove   a   continuous               readiness  and willingness, from the  date  of               the  contract to the time of the  hearing,  to               perform the contract on his part.  Failure  to               make  good that averment brought with  it  the               inevitable dismissal of his suit.  Thus it was               that the commencement               (1) 71 E. R. 23.               (2) 55 1. A. 360, at p. 372.               653               of  an  action  for  damages  being,  on   the               principle  of such cases as Clough  v.  London               and North Western Rly.  Co. (1871) L.R. 7  Ex.               261,  and  Law v. Law [(1904) 1  Ch.  140],  a               definite election to treat the contract as  at               an  end,  no suit  for  specific  performance,               whatever   happened  to  the   action,   could               thereafter  be  maintained  by  the  aggrieved               plaintiff.  He had, by his election  precluded               himself  even  from making the  averment  just               referred  to, proof of which was essential  to               the  success of his suit.  The effect upon  an               action  for damages for breach of  a  previous               suit for specific performance will be apparent               after  the question of the competence  of  the               Court  itself to award damages in such a  suit               has been touched upon." It  was pointed out by Lord Blanesburgh that the Indian  law on the subject as contained in the Specific Relief Act, 1877 is  not different from the English law.  At page 375 of  the same Report Lord Blanesburgh states :               "Although,  so  far as the Act  is  concerned,               there   is  no  express  statement  that   the               averment of readiness and willingness is in an               Indian   suit  for  specific  performance   as               necessary  as  it always was  in  England  [s.               24(b)  is the nearest, it seems invariably  to               have been recognized, and, on principle, their

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             Lordships  think rightly, that the Indian  and               the  English requirements in this  matter  are               the  same : see, e.g., Karsandas v.  Chhotalal               (25 Bom.  L.R. 1037, 1050)." In  the present case there is absence of an averment on  the part  of  the plaintiff in the plaint that he was  ready  to perform his part of the contract.  In the absence of such an averment it must be held that the plaintiff has no cause  of action  so  far as the relief for  specific  performance  is concerned. It was next contended on behalf of the appellant that in any event  the  High Court should have given  the  appellant  an option  to elect either of the two reliefs and ought not  to have  dismissed  the suit at a preliminary stage so  far  as relief  for specific performance was concerned.  We  do  not think there is any substance in this argument.  The question of  election between the two reliefs would have arisen  only if  the  appellant  could  have shown  that  in  respect  of specific  performance he had a cause of action.  As we  have already pointed out, the appellant has not made out a  cause of  action so far as the relief of specific  performance  is concerned and hence the appellant is not entitled to be  put to election with regard to the two alternative reliefs.   We accordingly  reject  the argument of the appellant  on  this aspect of the case. 654 Lastly,  it was argued on behalf of the appellant  that  the High  Court had no jurisdiction to interfere with the  order of the trial court under s. 115 of the Civil Procedure Code. It  was  said that the finding of the trial  court  did  not involve any question of jurisdiction and the High Court  has fallen  into an error in reversing the finding of the  trial court  on  issue  no. 4, whether  the  relief  for  specific performance  was open to the appellant in  the  alternative. In  our  opinion, there is no warrant for the  argument  put forward on behalf of the appellant.  It is manifest that  in holding  that the appellant was entitled in the  alternative to  ask  for the relief of specific performance,  the  trial court  had committed an error of. law and so had acted  with material  irregularity or illegality in the exercise of  its jurisdiction within the meaning of S. 1 15 (c) of the  Civil Procedure  Code.   It was therefore competent  to  the  High Court to interfere, in revision, with the order of the trial court on this point.  To put it differently, the decision of the  trial  court on this question was not a decision  on  a mere question of law but it was a decision on a question  of law upon which the jurisdiction of the trial court to  grant the particular relief depended.  The question was  therefore one which involved the jurisdiction of the trial court;  the trial  court  could not, by an erroneous finding  upon  that question, confer upon itself a jurisdiction which it did not possess  and its order was therefore liable to be set  aside by the High Court in revision. For  these  reasons we hold that there is no merit  in  this appeal which is accordingly dismissed with costs. Y.P.                                                  Appeal dismissed. 655