Readiness and willingness under Section 16 (c) of the Specific Performance Act has to be supported by documentary evidence

The Hon’ble High Court of Delhi in an appeal filed under Section 96, CPC has held that readiness and willingness as per Section 16(c) of the Specific Performance Act can only exist if the same is supported by documentary evidence that the parties were ready and willing to fulfill their respective obligations at the time of execution of document.

This was held by the Hon’ble High Court at Delhi in the matter Gulshan Kumar v. Shyam Lal Through LRs., RFA No. 349 of 2018 on 25^th April, 2018.

Challenge

In a suit specific performance of an admitted document, Agreement to Sell dated 24.05.2006, it is disputed between the parties whether the same had been entered into or not as the Respondent claims to have entered into an Agreement to sale with a third party. It was to be determined whether the Appellant/Plaintiff had shown financial capacity required as per the requirement of readiness and willingness as per Section 16 (c) of the Specific Relief Act, 1963 with respect to the ATS dated 24.05.2006. The Trial Court had held that the Appellant not being ready and willing to execute the ATS, had not produced any income tax return to show he had financial capacity to pay balance consideration of Rs. 90 Lakhs.

Held

The Hon’ble High Court of Delhi held that even though a bank statement of the Appellant was filed by him, wherein it is evident that the Appellant had an overdraft limit of Rs. 7 Crores, the balance amount in the said account was Rs. 23 Lakhs only on the day of expiry of last date for payment as per said ATS. Hence, the Appellant failed to show his readiness and willingness under Section 16 (c). The Court further observed that the statement of account relied upon by the Appellant to prove his financial capacity is of no use as he had filed no other documentary evidence with respect to having any properties, movable or immovable, by which the sale consideration of Rs. 90 Lakhs could have been paid at that time. The Court, therefore, exercised its powers under Order XLI Rule 24 of CPC held that the Plaintiff/Appellant failed to show his readiness and willingness as required by Section 16(c) of the Specific Relief Act and the present appeal was dismissed.