Citadel Fine Pharmaceuticals v. Ramaniyam Real Estates (P) Ltd (2011) 9 SCC 147

7/18/2019 Citadel Fine Pharmaceuticals v. Ramaniyam Real Estates (P) Ltd (2011) 9 SCC 147

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REPORTABLEIN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 6437 OF 2011(Arising out of Spei!" Le!#e Petition (C$

No%&'&)*&++'$

M*s Cit!,e" Fine P-!r.!euti!"s %%%

Appe""!nt(s$

- Versus -

M*s R!.!ni/!. Re!" Est!tes P% Lt,% 0 Anr%

%%%Respon,ent(s$

WITH

CIVIL APPEAL NO. 6438 OF 2011(Arising out of Spei!" Le!#e Petition (C$

No%1)&23*&++'$

M*s R!.!ni/!. Re!" Est!tes P% Lt,% %%%

Appe""!nt(s$

4 Versus –

M*s Cit!,e" Fine P-!r.!euti!"s 0 Anr%%%%Respon,ent(s$

J U D G M E N T

GANGULY J.

1



)% Le!#e is gr!nte, in 5ot- t-e spei!" "e!#e

petitions%

2. T-ese !ppe!"s -!#e 5een preferre, fro. t-e

6u,g.ent !n, fin!" or,er ,!te, &n,

Septe.5er7 &++' p!sse, in O%S%A%

No%11&*&++8 !n, C%M%P% No%)*&++8 5/ t-e

Di#ision 9en- of t-e M!,r!s Hig- Court%

1% T-e ontro#ers/ !rose out of ! suit of

speifi perfor.!ne% M*s% Cit!,e" Fine

P-!r.!euti!"s (,efen,!nt No%)$7 !

p!rtners-ip fir.7 o:ne, 22 ents of

!griu"tur!" "!n, (-erein!fter ;t-e suit

propert/<$7 for.ing ! p!rt of tot!" of

&%'8 !res of !griu"tur!" "!n, in sur#e/

nos% 1217 12=7 122*) of Ve"!-er/ #i""!ge7

M!.5"!.7 >uin,/ T!"u?7 Registr!tion

Distrit of M!,r!s7 !n, entere, into !n

!gree.ent for s!"e of t-e suit propert/

(-erein!fter ;t-e !gree.ent<$ for !

onsi,er!tion of Rs%)7++7++7+++*4 :it-

2



M*s% R!.!ni/!. Re!" Est!tes Pri#!te

Li.ite, (p"!intiff$7 :-i- :!s ! o.p!n/

inorpor!te, un,er t-e Co.p!nies At7 )32

!n, eng!ge, in t-e 5usiness of

onstruting 5ui",ings%

4. T-e !gree.ent ,!te, 8t- Ju"/7 )33 :!s t-e

su56et .!tter of suit 5et:een t-e !5o#e

p!rties% As per t-e !gree.ent7

Rs%)+7++7+++*4 of t-e s!"e onsi,er!tion

:!s to 5e p!i, upfront !s e!rnest .one/7

!n, t-e re.!in,er of Rs%3+7++7+++*4 :!s to

5e p!i, !t t-e ti.e of t-e registr!tion of

t-e s!"e ,ee,% At t-e ti.e of !gree.ent7

t-e suit propert/ :!s enu.5ere, 5/ :!/ of

seurit/ :it- M*s% St!te 9!n? of In,i!7

>uin,/ 9r!n- (,efen,!nt No%&$ !n,

t-erefore one of t-e on,itions of t-e

!gree.ent :!s t-!t ,efen,!nt No% ) :ou",

get t-e suit propert/ re"e!se, fro. su-

enu.5r!ne 5efore t-e fin!" p!/.ent of

3



Rs%3+7++7+++*4 :!s to 5e .!,e% Ap!rt fro.

t-is enu.5r!ne7 it :!s st!te, in t-e

!gree.ent7 t-e suit propert/ :!s to 5e

:it-out !n/ ot-er enu.5r!ne@ #i,e

"!uses & !n, 2 of t-e !gree.ent%

% Of t-e s!i, 22 ents7 -o:e#er7 )3 ents

:ere onsi,ere, eess ur5!n #!!nt "!n,

un,er t-e T!.i" N!,u Ur5!n L!n, (Cei"ing

!n, Regu"!tions$ At (&= of )38'$7

(-erein!fter ;t-e T!.i" N!,u At<$% As per

"!use 8 of t-e !gree.ent7 it :!s for t-e

p"!intiff to -!#e t-e "!n, "e!re, for

s!"e fro. t-e ur5!n "!n, ei"ing

!ut-orities% Un,er "!uses '7 )+ !n, )) of

t-e !gree.ent7 t-e s!"e :!s .!,e ti.e

5oun,% C"!use )+ st!te, t-!t ti.e :!s t-e

essene of t-is ontr!t% C"!use '

.!n,!te, t-!t un,er !"" iru.st!nes7 t-e

s!"e -!, to .!teri!"iBe :it-in ! /e!r fro.

t-e ,!te of t-e !gree.ent% In ter.s of

4



"!use 37 if t-e s!"e f!i"e, on !ount of

"!pses on p"!intiff<s p!rt7 t-e s!"e :!s

to st!n, o.p"ete"/ !ne""e,7 !n, t-e

e!rnest .one/ of Rs%)+7++7+++*4 :!s to 5e

returne,% As per "!use ))7 -o:e#er7 if

t-e s!"e f!i"e, 5e!use of ,efen,!nt No%

)7 t-e p"!intiff :!s !t "i5ert/ to sue for

speifi perfor.!ne of t-e ontr!t%

2% In pursu!ne to t-e !gree.ent7 t-e e!rnest

.one/ :!s p!i, 5/ t-e p"!intiff !n,

reei#e, 5/ ,efen,!nt No% )% T-e p"!intiff

t-en preferre, !n !pp"i!tion in For. 184I

presri5e, un,er Ru"e ='4L of t-e Ino.e

T! Ru"es7 )32&7 5efore t-e Appropri!te

Aut-orit/ for t-e "e!r!ne of t-e suit

propert/ for s!"e #i,e setion &23UC in

C-!pter of t-e Ino.e T! At7 )32)%

8% Ho:e#er7 t-e Ino.e T! Aut-orit/ refuse,

su- "e!r!ne on t-e groun, t-!t !s per

5



setion 2 of t-e T!.i" N!,u At7 !gree.ent

to se"" ! piee of ur5!n "!n, ,e"!re,

eess #!!nt "!n,7 or ! piee of "!n,7

p!rt of :-i- -!, 5een ,e"!re, eess

#!!nt ur5!n "!n,7 :!s ,ee.e, !s nu"" !n,

#oi,%

8. Fro. t-e St!te.ent !n, O56ets !n, Re!sons

of t-e T!.i" N!,u At it !ppe!rs t-!t it

:!s en!te, to i.pose ! ei"ing on t-e

u!ntu. of "!n, t-!t ou", 5e -e", or

o:ne, :it-in !n ur5!n !gg"o.er!tion% T-e

o56et of t-e At :!s to pre#ent

onentr!tion of o:ners-ip of ur5!n "!n,

in t-e -!n,s of ! fe:7 !n, to regu"!te t-e

onstrution of 5ui",ings on su- "!n,s7

speu"!ti#e tr!,ing of ur5!n "!n, !n,

i""eg!" profiteering% Un,er t-e At7 t-e

ei"ing "i.it -!, 5een fie, 5/ Setion %

Setion 2 of t-e At pre#ente, tr!nsfer of

6



su- eess #!!nt ur5!n "!n, 5/ its o:ner

to !n/ ot-er person% Setion 2 is set out

2% T!"#$%&! '% (")"#* +"#, % No person -o",ingin eess of t-e ei"ing "i.it i..e,i!te"/

5efore t-e o..ene.ent of t-is At7 #!!nt

"!n,7 s-!"" tr!nsfer !n/ su- "!n, or p!rt

t-ereof 5/ :!/ of s!"e7 .ortg!ge7 gift7 "e!se or

ot-er:ise unti" -e -!s furnis-e, ! st!te.ent

un,er setion 8 !n, ! notifi!tion reg!r,ing t-e

eess #!!nt "!n, -e", 5/ -i. -!s 5een

pu5"is-e, un,er su5 setion ()$ of setion ))@

!n, !n/ su- tr!nsfer .!,e in ontr!#ention of

t-is pro#ision s-!"" 5e ,ee.e, to 5e nu"" !n,

#oi,%

3% T-e setion t-us en6oine, t-!t "!n,o:ners

-o",ing eess #!!nt "!n, !re to furnis-

! st!te.ent un,er Setion 8% In t-is !se7

)3 ents :ere onsi,ere, eess ur5!n

#!!nt "!n, #i,e !se no% R%C%2)2+*'2 !n,

,efen,!nt No% ) fi"e, its st!te.ent un,er

Setion 8%

)+% Setion 3 pro#i,e, for prep!r!tion of !

,r!ft st!te.ent !s reg!r,s t-e eess

#!!nt "!n,% Un,er "!use ($ of Setion

7



37 t-e Co.petent Aut-orit/7 so ,esign!te,

un,er t-e T!.i" N!,u At7 :!s to onsi,er

o56etions preferre, 5/ ! "!n, o:ner7 !n,

t-en p!ss or,ers :it- respet to t-e

uestion of eess "!n,% Defen,!nt no% )

preferre, its o56etions 5efore t-e

Co.petent Aut-orit/% T-e o56etions

-o:e#er :ere ,is.isse,% T-e ,efen,!nt no%

) t-en preferre, !n !ppe!" 5efore t-e

Spei!" Co..issioner (L!n, Refor.s$7

M!,r!s !n, t-e !ppe!" :!s ?ept pen,ing%

))% In !or,!ne :it- Setion )) ()$7 !

notifi!tion reg!r,ing t-e )3 ents 5eing

eess #!!nt "!n, :!s pu5"is-e, !n, !n/

tr!nsfer .!,e in ontr!#ention of t-is

pro#ision :!s ,ee.e, to 5e nu"" !n, #oi,%

Setion )) pro#i,e, for !uisition of

su- #!!nt ur5!n "!n, 5/ t-e St!te

>o#ern.ent%

8



)&% Defen,!nt no% ) !"so preferre, !n

!pp"i!tion for ee.ption of t-!t )3 ents

of "!n, un,er t-e pro#isions of Setion

&)% Setion &) e.po:ere, t-e St!te

>o#ern.ent to ee.pt ! piee of #!!nt

eess "!n, fro. !uisition .entione,

!5o#e%

13. T-!t !pp"i!tion :!s !"so ,is.isse,%

Defen,!nt no% ) t-en preferre, Grit

Petition No% )13+2*&++' 5efore t-e Hig-

Court -!""enging t-e ,e"!r!tion in R% C%

2)2+*'2% In t-e :rit petition7 ,efen,!nt

no% ) pr!/e, for ! st!/ of t-e proee,ings

!n, :-i- :!s !""o:e,% Ho:e#er7 ,uring t-e

pen,en/ of t-is :rit petition t-e T!.i"

N!,u At :!s repe!"e, on )2t- June7 )333 5/

t-e T!.i" N!,u Ur5!n L!n, (Cei"ing !n,

Regu"!tion$ Repe!" At7 )333 (&+ of )333$

(-erein!fter ;t-e Repe!"ing At<$% Un,er

Setion = of t-e repe!"ing At7 !""

9



proee,ings re"!ting to !n/ or,er .!,e or

purporte, to 5e .!,e un,er t-e Prinip!"

At7 t-!t is t-e T!.i" N!,u At7 s-!""

!5!te% Setion = of t-e Repe!"ing At is

!s fo""o:s4

4. A-"*&&#* '% +&/"+ !')&&,#/$% 4 A""

proee,ings re"!ting to !n/ or,er .!,e or

purporte, to 5e .!,e un,er t-e Prinip!" At

pen,ing i..e,i!te"/ 5efore t-e o..ene.ent of

t-is At 5efore !n/ ourt7 tri5un!" or !n/

!ut-orit/ s-!"" !5!te%

Pro#i,e, t-!t t-is setion s-!"" not !pp"/ to

t-e proee,ings re"!ting to Setions )&7 )17 )=7

"7 )49 !n, )2 of t-e Prinip!" At in so f!r

!s su- proee,ings !re re"!t!5"e to t-e "!n,7

possession of :-i- -!s 5een t!?en o#er 5/ t-e

St!te >o#ern.ent of !n/ person ,u"/ !ut-orise,5/ t-e St!te >o#ern.ent in t-is 5e-!"f or 5/ t-e

o.petent !ut-orit/%

)=% A,.itte,"/7 possession of )3 ents of

"!n,7 in respet of :-i- proee,ing :!s

pen,ing7 :!s not t!?en o#er 5/ t-e

>o#ern.ent% So t-e pen,ing proee,ing in

respet of t-!t "!n, un,er t-e Prinip!"

At7 t-!t is t-e T!.i" N!,u At7 s-!""

10



!5!te in #ie: of Setion = of t-e

Repe!"ing At%

)% Ho:e#er7 Ino.e T! !ut-orities7 !s note,

!5o#e7 -!, refuse, to proess For. 184I in

#ie: of t-e proee,ings initi!te, un,er

t-e T!.i" N!,u At% H!#ing referre, to

setion 2 of t-e At7 t-e !ppropri!te

!ut-orit/7 :-i"e re6eting for. 184I

st!te,

In o"u.n '7 it -!s 5een .entione, t-!t !n

etent of )3 ents -!s 5een ,e"!re, !s eess

#!!nt "!n, un,er setion 3 ($ of T!.i" N!,u

Ur5!n L!n, (Cei"ing !n, Regu"!tions$ At7 )38'

t-!t !n !ppe!" is pen,ing 5efore t-e Spei!"Co..issioner (L!n, Refor.s$7 M!,r!s !n, t-!t t-e

tr!nsferor -!s !"so !pp"ie, to t-e St!te

>o#ern.ent for ee.ption un,er Setion &) of t-e

s!i, At 5ut t-e s!.e -!s 5een re6ete, !n, t-e

.!tter is pen,ing in G% P% No% )13+2*)3''7

5efore t-e Hig- Court7 M!,r!s%

&% It tr!nspires7 t-erefore7 t-!t t-e

tr!nsferor inten,s to tr!nsfer t-e entire etent

of 22 ents7 in"usi#e of t-e )3 ents of "!n,

:-i- is ,e"!re, !s eess #!!nt "!n, 5/ t-eCo.petent Aut-orit/ un,er t-e Ur5!n L!n, Cei"ing

At7 :-i- is pro-i5ite, 5/ setion 2 of t-e

T!.i" N!,u Ur5!n L!n, (Cei"ing !n, Regu"!tions$

At7 )38'% %

In #ie: of t-e pro-i5ition ont!ine, in

setion 27 uote, !5o#e7 t-e !gree.ent entere,

into 5et:een t-e p!rties on 8%8%3 to tr!nsfer

11



t-e entire "!n,7 in"u,ing t-e eess #!!nt

"!n, of )3 ents7 s-!"" 5e ,ee.e, to 5e nu"" !n,

#oi,% In #ie: of t-is "eg!" pro-i5ition7 :e !re

un!5"e to proess t-e 184I st!te.ent fi"e, 5/

/ou !n, t-erefore7 t-e s!.e is "o,ge, in t-is

offie% If /ou !re so !,#ise,7 /ou .!/ fi"e !fres- 184I st!te.ent for tr!nsfer of t-e 5!"!ne

"!n, on"/%

16. As per "!use (8$ of t-e !gree.ent7 it :!s

t-e p"!intiff<s responsi5i"it/ to -!#e t-e

suit propert/ "e!re, for s!"e 5/ t-e

ur5!n "!n, ei"ing !ut-orities% Sine For.

18I :!s not "e!re,7 t-e p"!intiff sent

t:o "etters ,!te, )+t- June7 )332 !n, 1r,

Ju"/7 )332 to t-e ,efen,!nt reuesting

t-!t t-e s!"e 5e sp"it up !n, t:o sep!r!te

!gree.ents 5e entere, into% T-e first for

t-e unenu.5ere, =8 ents !n, t-e seon,

for )3 ents ter.e, !s t-e eess "!n, 5/

t-e ur5!n "!n, ei"ing !ut-orit/% T-is

propos!" :!s re6ete, 5/ t-e ,efen,!nt no%

) on t-e groun,s t-!t t-e !gree.ent is not

,i#isi5"e% Aor,ing to ,efen,!nt No%)7

12



t-e sp"itting up of t-e !gree.ent into t:o

in effet .e!nt t-e :riting of !n entire"/

ne: ontr!t% T-e 5!r un,er setion 2 of

t-e T!.i" N!,u At7 !s pointe, out 5/ t-e

Appropri!te Aut-orit/ :!s !pp"i!5"e not

on"/ in respet of t-e )3 ents of "!n,

ter.e, !s eess7 5ut in f!t t-e entire

22 ents for t-e re!son t-!t t-e s!i, )3

ents ou", not 5e se#ere, fro. t-e 22

ents% T-e ,efen,!nt No%) urge, t-!t t-e

ontr!t :!s -it 5/ i""eg!"it/ !n, :!s

t-us frustr!te,%

17. T-e p"!intiff7 t-e propose, pur-!ser7

un,er t-ese iru.st!nes institute, on 3t-

Septe.5er7 )33' t-e suit for speifi

perfor.!ne of t-e ontr!t7 #iB% C% S%

'3*)332 for t-e entire 22 ents of "!n,%

)'% T-e p"!int !se is t-!t !t t-e ti.e t-e

!gree.ent for s!"e :!s entere, into7 it

13



:!s ?no:n to 5ot- t-e p!rties t-!t )3

ents of t-e suit propert/ -!, 5een

,e"!re, eess "!n, un,er t-e T!.i" N!,u

At7 !n, t-!t !n !ppe!" to t-e Spei!"

Co..issioner (L!n, Refor.s$7 M!,r!s :!s

pen,ing% It !"so su5.itte, t-!t t-e

p!rties ?ne: t-!t ! :rit petition

-!""enging t-e St!te >o#ern.ent<s refus!"

to ee.pt t-e propert/ un,er setion &) of

t-e T!.i" N!,u At :!s !"so pen,ing% Git-

?no:"e,ge t-e p!rties entere, into t-e

!gree.ent to se""% T-e p"!intiff su5.itte,

t-!t t-is .eeting of .in,s :!s ref"ete,

in "!use 8 of t-e !gree.ent% T-ere :!s

t-us no ne: !n, unforeseen ,e#e"op.ent

"e!,ing to t-e frustr!tion of ontr!t !s

su- t-e re"ief for speifi perfor.!ne

of t-e ontr!t :!s pr!/e, or in t-e

!"tern!ti#e7 it :!s pr!/e, t-e p"!intiff

5e !""o:e, ! refun, of t-e e!rnest .one/

:it- !n interest of &K per !nnu. !n,

14



"iui,!te, ,!.!ges to t-e tune of

Rs%87++7+++*4 !"ong :it- osts%

19. T-e ,efen,!nt7 t-e propose, #en,or7

resiste, t-e suit 5/ su5.itting t-!t t-e

!gree.ent to se"" :!s :it- respet to t-e

entire suit propert/7 i%e% 22 ents7 !n,

t-us ou", not -!#e 5een sp"it into

sep!r!te !gree.ents to se"" for =8 ents

!n, )3 ents% It su5.itte, t-!t in #ie: of

t-e 5!r p"!e, 5e!use of setion 2 of t-e

T!.i" N!,u At !n, t-e onseuenti!"

refus!" 5/ t-e !ppropri!te !ut-orit/ un,er

t-e ino.e t! ,ep!rt.ent to !""o: t-e

eeution of t-e s!"e7 t-e ontr!t itse"f

-!, 5eo.e frustr!te, !n, t-us

unenfore!5"e in "!:%

20. It :!s furt-er urge, t-!t ti.e :!s t-e

essene of t-e ontr!t !n, it :!s for t-e

p"!intiff pur-!ser to see? ee.ption for

15



t-e s!i, )3 ents "!n, fro. t-e ur5!n "!n,

ei"ing ,ep!rt.ent7 :-i- -o:e#er it

f!i"e, to ,o% As ! resu"t of t-is f!i"ure7

t-e s!"e ou", not 5e !ffete, :it-in !

/e!r<s ti.e% T-is "e!r"/ ren,ere, t-e

ontr!t #oi, in ter.s of "!uses ' !n, )+

insof!r !s t-e ontr!t :!s not perfor.e,

:it-in ! /e!r<s ti.e% Hene7 "!use 3 :!s

!ttr!te, !n, t-e ontr!t stoo, !ne""e,

for ,ef!u"t of t-e p"!intiff% It su5.itte,

t-!t in ter.s of "!use 37 t-e propose,

#en,or (,efen,!nt no%)$ refun,e, t-e

e!rnest .one/ to t-e p"!intiff4pur-!ser%

Ho:e#er t-e -eue sent un,er registere,

post !.e 5!? to t-e ,efen,!nt no% )

;refuse,<% It !ppe!rs t-!t t-e s!.e

refuse, 5/ t-e p"!intiff4pur-!ser eit-er

5/ 2t- or 8t- Septe.5er7 )332%

&)% As su- t-e ,efen,!nt no% ) pr!/e, for

,is.iss!" of t-e suit in #ie: of

16



i.possi5i"it/ of perfor.!ne of t-e

ontr!t !n, non4perfor.!ne 5/ t-e

p"!intiff of its o5"ig!tion un,er t-e

ontr!t :it-in t-e stipu"!te, ti.e%

&&% Ho:e#er7 t-e "e!rne, Sing"e Ju,ge -e",

t-!t t-e suit propert/ :!s in respet of

!griu"tur!" "!n, !n, not !5out !n ur5!n

"!n, !s onte.p"!te, un,er t-e T!.i" N!,u

At% It :!s furt-er note, 5/ t-e "e!rne,

Ju,ge t-!t !s t-e T!.i" N!,u At -!, 5een

repe!"e, in )3337 its !pp"i!tion itse"f

:ou", 5e "i.ite, to on"/ t-ose inst!nes

:-ere possession of t-e eess #!!nt "!n,

-!, 5een t!?en o#er 5/ t-e St!te

>o#ern.ent%

&1% T-e "e!rne, Ju,ge note, t-!t t-e suit

propert/ in t-e inst!nt !se ,i, not

!ttr!t !n/ of t-e pro#isions .entione, in

Setion 1 of t-e Repe!"ing At% Aor,ing

17



to t-e "e!rne, Ju,ge7 t-ere :ere t:o

re!sons for :-i- t-e pro#isions of T!.i"

N!,u At :ou", not !pp"/ to t-e inst!nt

!gree.ent first"/7 t-e suit propert/ :!s

!griu"tur!" in n!ture !n, t-us t-e s!.e

:!s outsi,e t-e pur#ie: of t-e At%

Seon,"/7 !fter t-e repe!" of t-e T!.i"

N!,u At in )3337 none of its pro#isions

!ffete, t-e !gree.ent% T-e Ju,ge -e",

t-!t "!use (8$ in itse"f7 -o:e#er7 :!s

not ! on,ition pree,ent to t-e ontr!t%

It .ere"/ st!te, t-!t "e!r!ne of t-e

s!i, )3 ents fro. t-e ur5!n "!n, ei"ing

!ut-orities :!s upon t-e p"!intiff7 !n,

t-!t in t-e e#ent t-e p"!intiff :!s un!5"e

to -!#e it "e!re,7 t-e ,efen,!nt no% )

s-!"" not 5e pro#i,e, :it- !n/ !"tern!ti#e

piee of "!n, or !n/ o.pens!tion% T-us7

t-e "e!rne, Ju,ge -e", t-!t t-e p"!intiff

:!s entit"e, to speifi perfor.!ne of

t-e ontr!t !n, ,eree, t-e suit%

18



&=% Aggrie#e,7 t-e ,efen,!nt no% ) preferre,

!n !ppe!"% T-e "e!rne, Di#ision 9en-

p!rt"/ !""o:e, it -o",ing t-!t t-e

respon,ents ou", 5e gi#en t-e re"ief of

speifi perfor.!ne on"/ to t-e etent of

=8 ents of t-e "!n,s t-!t :ere not p!rt

of t-e proee,ings un,er t-e T!.i" N!,u

At%

&% Ap!rt fro. up-o",ing t-e 6u,g.ent of t-e

"e!rne, Ju,ge :it- respet to t-e

!griu"tur!" n!ture of t-e suit propert/7

t-e Di#ision 9en- note, t-!t in none of

t-e "etters e-!nge, 5et:een t-e p!rties

it -!, o.e on reor, t-!t t-e !gree.ent

-!, 5eo.e i""eg!" in #ie: of t-e

pro#isions of Setion 2 of t-e T!.i" N!,u

At% On t-e ontr!r/7 in !"" t-ese

o..uni!tions7 t-e on"/ position t-!t t-e

,efen,!nt no% ) -!, insiste, upon :!s t-e

19



s!tisf!tion of t-e on,itions .entione,

in "!use (8$ of t-e !gree.ent7 #iB%7

per.ission for t-e s!"e of )3 ents 5/ t-e

ur5!n "!n, ei"ing !ut-orities% T-e

"e!rne, Di#ision 9en- note, t-!t if t-is

:!s t-e st!ne of t-e ,efen,!nt no% )7 it

ou", not 5e !""o:e, to resist t-e suit on

t-e groun,s of i""eg!"it/ of ontr!t%

26. Ho:e#er7 it ,is!gree, :it- t-e ,eision of

t-e "e!rne, Ju,ge to t-e etent t-e repe!"

of t-e T!.i" N!,u At ,i, not in itse"f

re"e!se, )3 ents of t-e eess #!!nt

"!n, fro. t-e proee,ings initi!te, un,er

t-!t At% It -e", t-!t Setion 1 of t-e

Repe!" At pro#i,e, t-!t repe!"ing of t-e

T!.i" N!,u At :ou", not !ffet t-e

#esting of !n/ #!!nt "!n, un,er su5

setion (1$ of Setion )) of t-e T!.i"

N!,u At in !ses :-ere t-e possession of

su- #!!nt "!n, -!, 5een t!?en o#er 5/

20



t-e St!te >o#ern.ent% Re"/ing upon !n,

fo""o:ing ,eision of ! Fu"" 9en- of t-e

Hig- Court in P. Gopirathnam and 4 Others

v. Ferrodous Estate (Private) Limited ,

represented by its Power of Attorney

Hoder !ri G. "ohn Arthur 7 )333 (&$

Current T!.i" N!,u C!ses )')7 t-e "e!rne,

9en- -e", t-!t t-e proee,ings :it-

respet to t-e s!i, )3 ents -!, 5een

initi!te, !n, t-!t t-e s!.e :ere pen,ing%

T-e Di#ision 9en- -e", t-!t ,eree for

speifi perfor.!ne !s gi#en 5/ t-e

"e!rne, Ju,ge -!, to 5e .o,ifie, to t-e

etent t-!t t-e s!.e :!s possi5"e on"/ to

t-e etent of t-e unenu.5ere, portion of

t-e "!n,%

&8% One of t-e .!in uestions :-i- !rise for

onsi,er!tion in t-e f!ts of t-is Court

is :-et-er in t-e s!i, !gree.ent ti.e is

of t-e essene of t-e ontr!t% In or,er

21



to !pprei!te t-is uestion7 t-e Court -!s

to onsi,er se#er!" "!uses in t-e s!i,

!gree.ent% T-e re"e#!nt "!uses !re

"!uses 87 '7 3 0 )+7 :-i- !re set out

5e"o:

8% T-e #en,or st!tes t-!t !n etent of 88+

s%.ts% in S%No%121*)9 0 121*)C for.ing p!rt of

t-e propert/ ,esri5e, 5e"o: !n, !gree, to 5e

so", -!s 5een ,e"!re, !s eess #!!nt "!n,

un,er Se 3($ of t-e T!.i" N!,u Ur5!n L!n,

Cei"ing (C0R$ At7 )38'% An !ppe!" is pen,ing

5efore t-e Spei!" Co..issioner (L!n, Refor.s$7

M!,r!s% T-e Ven,or !"so !pp"ie, to t-e St!te

>o#ern.ent for ee.ption un,er Se &) of t-e At

5ut t-e s!.e -!s 5een re6ete, !n, t-e .!tter is

pen,ing in G%P%)13+2*)3'' 5efore t-e Hig- Court7

M!,r!s% It s-!"" 5e t-e so"e responsi5i"it/ of

t-e Pur-!ser to get "e!r!ne fro. t-e Ur5!n

L!n, Cei"ing Aut-orities 5/ negoti!tion orgetting ee.ption un,er t-e At or per.ission to

se""7 !t -is o:n ost !n, t-e Ven,or s-!"" not

5e responsi5"e for t-e s!.e% 9ut7 t-e Ven,or

s-!"" sign !"" !pp"i!tions or petitions

neess!r/ for t-is purpose% G-i"e7 getting

per.ission to se"" or ee.ption un,er t-e At in

respet of t-e propert/ !gree, to 5e so",7 t-e

Pur-!ser s-!"" ensure t-!t no o.pens!tor/

"!i. or !"tern!te "!n, is "!i.e, 5/ t-e Ur5!n

L!n, Cei"ing !ut-orities in t-e rest of t-e "!n,to 5e ret!ine, 5/ t-e Ven,or%

'% T-e ti.e for o.p"etion of t-e pur-!se

s-!"" 5e one /e!r fro. t-e ,!te of t-is

!gree.ent%

22



3% If t-e pur-!ser f!i"s to o.p"ete t-e

tr!ns!tion :it-in t-e ti.e stipu"!te,7 t-is

!gree.ent s-!"" st!n, !ne""e, !n, ! su. of

Rs%)+7++7+++*4 (Rupees Ten L!?-s on"/$ p!i, !s

e!rnest .one/ :i"" 5e returne, :it-out interest

to t-e Pur-!ser !n, t-e Ven,or s-!"" 5e !t"i5ert/ to se"" t-e propert/ to :-o.soe#er -e

"i?es%

)+% Ti.e s-!"" 5e t-e essene of t-e ontr!t%

28. A,.itte,"/7 t-e !gree.ent :!s entere, into

on 8t- Ju"/7 )33 !n, t-e perio, of one

/e!r epire, 5/ 2t- Ju"/7 )332% Git-in t-!t

perio, t-e p"!intiff4pur-!ser ou", not

get "e!r!ne fro. t-e Ur5!n L!n, Cei"ing

Aut-orities nor ou", t-e/ o5t!in t-e

ee.ption un,er t-e At for per.ission to

se"" ! p!rt of t-e propert/ in respet of

:-i- t-e suit for speifi perfor.!ne

:!s fi"e,%

29. It is not t-e !se of t-e p"!intiff4

pur-!ser t-!t t-e #en,or in !n/ :!/

,e"!/e, t-e signing of !pp"i!tion or

petition neess!r/ for getting su-

23



per.ission for "e!r!ne% Fro. so.e

orrespon,ene e-!nge, 5et:een t-e

p!rties it is "e!r t-!t pur-!ser too? !

fe: steps 5ut ou", not get t-e "e!r!ne

:it-in t-e ti.e !gree, 5/ it% T-e Ven,or7

-o:e#er7 5/ ! "etter ,!te, =t- Septe.5er7

)332 !ne""e, t-e !gree.ent in ter.s of

"!use 3 of t-e !gree.ent !n, returne, t-e

!,#!ne .one/ of Rs%)+7++7+++*4 #i,e !

-eue in ter.s of "!use 3% T-e s!i,

"etter :ritten 5/ t-e #en,or is set out

5e"o:4

CITADEL FINE PHARMACEUTICALS

Ref 1'&*32

=t- Septe.5er )332

M*s% R!.!ni/!. Re!" Est!tes P#t% Lt,%7

Rep% 5/ Mr% V% J!g!nn!t-!n7

M!n!ging Diretor7

;Srut-i<% No%))7 &n, M!in R!o,7

>!n,-i N!g!r7M!,r!s 2++ +&+%

De!r Sir7

Re )% Our "etter ,!te, ))%8%32

&% our "etter ,!te, )3%8%32%

24



As :ou", 5e !pprei!te, 5/ /ou7 !t t-e .eeting

-!, :it- /ou7 5/ ourse"f t-roug- our Mr% R!6i#

!n, furt-er 5/ te"ep-one on 1+%'%)332 !s /ou

-!#e epresse, /our re"ut!ne in !epting our

ter.s put to /ou on t-e s!"e of t-e propert/7 :e

!re returning t-e !,#!ne .one/ ofRs%)+7++7+++*4 #i,e S9I7 >uin,/7 C-eue

No%3+=+)= ,t%=%3%)332 in ter.s of C"!use 3 of

t-e Agree.ent ,!te, 8t- Ju"/7 )33%

in,"/ !?no:"e,ge t-e reeipt of t-is%

T-!n?ing /ou7

ours f!it-fu""/7

For CITADEL FINE PHARMACEUTICALS

S,*4

P!rtner

En" !s !5o#e

1+% Un,er t-ese iru.st!nes7 t-e uestion is

:-et-er fro. t-e f!ts of t-is !se #en,or

!n r!ise ! ,efene to t-e suit for

speifi perfor.!ne of t-e ontr!t t-!t

ti.e 5eing of t-e essene of t-is

ontr!t7 t-e Court !nnot or,er its

speifi perfor.!ne :-en p"!intiff f!i"e,

to ,is-!rge its p!rt of t-e ontr!t

:it-in ti.e !n, :-en !fter epir/ of ti.e7

25



t-e ontr!t :!s !ne""e, 5/ t-e #en,or

in ter.s of "!use 3 of t-e Contr!t%

1)% T-e sett"e, "!: see.s to 5e t-!t in ! !se

for speifi perfor.!ne of ontr!t

re"!ting to i..o#!5"e propert/ ti.e is not

nor.!""/ of t-e essene% Ho:e#er7 t-is is

not !n !5so"ute proposition !n, it -!s

se#er!" eeptions%

32. Referene in t-is onnetion .!/ 5e .!,e

to t-e ,eision of Pri#/ Couni" in

J"$&, ',"!" I!"# #% B!5'!5

D#5-" reporte, in ()3)4)2$ =1 I%A%

&2% Visount H!",!ne ,e"i#ering t-e

6u,g.ent for t-e Ju,ii!" Co..ittee of t-e

Pri#/ Couni" -e", t-!t t-e "!: !pp"i!5"e

to t-is uestion is ont!ine, in Setion

of t-e In,i!n Contr!t At !n, t-e

"e!rne, L!: Lor, :!s of t-e opinion t-!t

Setion of t-e In,i!n Contr!t At ,oes

26



not "!/ ,o:n !n/ prinip"e :-i- is

,ifferent fro. t-ose :-i- o5t!in un,er

t-e "!: of Eng"!n, :it- reg!r, to

ontr!ts for s!"e of "!n,% It :!s furt-er

-e", t-!t in !ses re"!ting to speifi

perfor.!ne7 euit/7 :-i- go#erns t-e

rig-ts of t-e p!rties7 ,oes not "oo?

!":!/s !t t-e epress ter. of t-e

!gree.ent 5ut !t t-e su5st!ne of it in

or,er to !sert!in :-et-er t-e p!rties

n!.e, ! speifi ti.e :it-in :-i-

o.p"etion :!s to t!?e p"!e !n, :-et-er

t-e p!rties in su5st!ne inten,e, t-!t t-e

o.p"etion s-ou", t!?e p"!e :it-in !

re!son!5"e ti.e% T-e "eg!" position :!s

!s fo""o:s4

A Court of Euit/ :i"" in,ee, re"ie#e

!g!inst !n, enfore speifi perfor.!ne7not:it-st!n,ing ! f!i"ure to ?eep t-e ,!tes

!ssigne, 5/ t-e ontr!t@ eit-er for o.p"etion

or for t-e steps to:!r,s o.p"etion7 if it !n

,o 6ustie 5et:een t-e p!rties7 !n, if (!s Lor,

Justie Turner s!i, in Ro5erts #% 9err/ 1 D%M%0

>% &'= !t &'3 t-ere is not-ing in t-e ;epress

stipu"!tion 5et:een t-e p!rties7 t-e n!ture of

27



t-e propert/7 or t-e surroun,ing iru.st!nes<7

:-i- :ou", .!?e it ineuit!5"e to interfere

:it- !n, .o,if/ t-e "eg!" rig-t% (p!ge 1& of

t-e report$

11% T-e "e!rne, L!: Lor, .!,e it "e!r t-!t

euit/ !n oper!te in t-e onstrution of

! ontr!t un"ess e"u,e, 5/ !n/ "e!r"/

epresse, stipu"!tion% Ho:e#er7 it :!s

.!,e "e!r t-!t euit/ :i"" not !ssist

:-ere t-ere -!s 5een un,ue ,e"!/ on t-e

p!rt of one p!rt/ to t-e ontr!t !n, one

p!rt/ -!s gi#en notie to t-e ot-er p!rt/

t-!t t-e ,ef!u"ting p!rt/ .ust o.p"ete

t-e ontr!t :it-in ! ,efinite ti.e% A

furt-er !ution :!s !,,e, 5/ s!/ing t-!t

euit/ :i"" not !ssist :-en ot-er

iru.st!nes :i"" resu"t in in6ustie on

!pp"i!tion of euit!5"e prinip"e% In t-e

:or,s of Lor, H!",!ne t-e prinip"es -!#e

5een for.u"!te, !s fo""o:s4

Nor :i"" it (euit/$ eerise its 6uris,ition

:-en t-e -!r!ter of t-e propert/ or ot-er

28



iru.st!nes :ou", ren,er su- eerise "i?e"/

to resu"t in in6ustie% In su- !ses t-e

iru.st!nes t-e.se"#es7 !p!rt fro. !n/

uestion of epresse, intention7 e"u,e t-e

6uris,ition% Euit/ :i"" furt-er infer !n

intention t-!t ti.e s-ou", 5e of t-e essenefro. :-!t -!s p!sse, 5et:een t-e p!rties prior

to t-e signing of t-e ontr!t% (P!ge 11 of

t-e report$

1=% In t-is !se7 prior to t-e signing of t-e

!gree.ent7 t-e ter.s :ere ,isusse,

5et:een t-e p!rties !n, t-e p"!intiff

pur-!ser :i""ing"/ too? upon itse"f t-e

5ur,en of o5t!ining t-e "e!r!ne :it-in

t-e ti.e stipu"!te, in t-e !gree.ent%

35. T-e !fores!i, prinip"es in J"$&,

',"!" (supr!$ :ere !epte, 5/ ! t-ree4

Ju,ge 9en- of t-is Court in t-e !se of

G'"*#""/" P++" "#, '*&!$ #%

P"+"#$" N","! reporte, in AIR )328 SC

'2'%

29



12% Fro. t-e ter.s of !gree.ent in t-is !se

:-i- -!#e 5een set out in t-e e!r"ier

p!rt of t-e 6u,g.ent it is "e!r t-!t t-e

ti.e is of t-e essene !n, t-is is "e!r"/

stipu"!te, !n, un,erstoo, 5/ t-e p!rties

-!#ing reg!r, to t-e pre#ious

orrespon,ene !n, !"so -!#ing reg!r, to

t-e "!i, ,o:n ter.s of t-e ontr!t !n,

espei!""/ :-en t-e onseuene of non4

o.p"etion of t-e ter.s 5/ pur-!ser

:it-in t-e stipu"!te, ti.e :!s spe"t out

in "!use 3%

37. In ! !se :-ere ti.e is of t-e essene of

t-e ontr!t7 t-e onseuene of non4

perfor.!ne of su- ter. -!s 5een #er/

suint"/ ep"!ine, 5/ Chitty on

Contracts, (Volume 1, Thirteenth Edition,

Sweet & Mawell in !ara"ra!h #1-$1% !n,

t-e s!.e is set out

30



Conseuenes of ti.e 5eing of t-e

essene% In ,eter.ining t-e onseuenes of !

stipu"!tion t-!t ti.e is to 5e of t-e essene

of !n o5"ig!tion7 it is #it!" to ,istinguis-

5et:een t-e !se :-ere 5ot- p!rties !gree t-!t

ti.e is to 5e of t-e essene of t-e o5"ig!tion!n, t-e !se :-ere7 fo""o:ing ! 5re!- of ! non4

essenti!" ter. of t-e ontr!t7 t-e innoent

p!rt/ ser#es ! notie on t-e ot-er st!ting t-!t

ti.e is to 5e of t-e essene% In t-e for.er !se

t-e effet of ,e"!ring ti.e to 5e of t-e

essene is to e"e#!te t-e ter. to t-e st!tus of

! on,ition :it- t-e onseuenes t-!t !

f!i"ure to perfor. 5/ t-e stipu"!te, ti.e :i""

entit"e t-e innoent p!rt/ to (!$ ter.in!te

perfor.!ne of t-e ontr!t !n, t-ere5/ put !n

en, to !"" t-e pri.!r/ o5"ig!tions of 5ot-

p!rties re.!ining unperfor.e,@ !n, (5$ "!i.

,!.!ges fro. t-e ontr!t45re!?er on t-e 5!sis

t-!t -e -!s o..itte, ! fun,!.ent!" 5re!- of

t-e ontr!t (! 5re!- going to t-e root of t-e

ontr!t$ ,epri#ing t-e innoent p!rt/ of t-e

5enefit of t-e ontr!t (,!.!ges for "oss of

t-e :-o"e tr!ns!tion% (p!ge )=)+$

38. 'ry in -is Treaties on the S!eciic

)erormance of Contracts (Sith Edition

-!s ,e!"t :it- t-is !spet in p!r!gr!p-

)+84

Ti.e is origin!""/ of t-e essene of t-e

ontr!t7 in t-e #ie: of ! Court of Euit/7

:-ene#er it !ppe!rs to -!#e 5een p!rt of t-e

re!" intention of t-e p!rties t-!t it s-ou", 5e

so7 !n, not to -!#e 5een inserte, !s ! .ere"/

31



for.!" p!rt of t-e ontr!t% As t-is intention

.!/ eit-er 5e sep!r!te"/ epresse,7 or .!/ 5e

i.p"ie, fro. t-e n!ture or struture of t-e

ontr!t7 it fo""o:s t-!t ti.e .!/ 5e origin!""/

of t-e essene of ! ontr!t7 !s to !n/ one or

.ore of its ter.s7 eit-er 5/ #irtue of !nepress on,ition in t-e ontr!t itse"f .!?ing

it so7 or 5/ re!son of its 5eing i.p"ie,%

(p!ge +&$

13% In p!r!gr!p- )+837 t-e "e!rne, !ut-or -!s

ep"!ine, t-e position furt-er 5/ s!/ing

t-e ti.e .!/ 5e i.p"ie, !s essenti!" in !

ontr!t fro. t-e n!ture of t-e su56et

.!tter :it- :-i- t-e p!rties !re ,e!"ing%

T-e "e!rne, !ut-or ep"!ine, t-is 5/

s!/ing4

)+83% Ti.e .!/ 5e i.p"ie, !s essenti!" in !

ontr!t7 fro. t-e n!ture of t-e su56et4.!tter

:it- :-i- t-e p!rties !re ,e!"ing% If7

t-erefore7 s!i, A",erson 9%7 t-e t-ing so", 5e

of gre!ter or "ess #!"ue !or,ing to t-e

eff"uion of ti.e7 it is .!nifest t-!t ti.e is

of t-e essene of t-e ontr!t !n, !stipu"!tion !s to ti.e .ust t-en 5e "iter!""/

o.p"ie, :it- in Euit/ !s :e"" !s in L!:%

(p!ge +=$

32



=+% At p!r!gr!p- )+') p!ge +7 t-e "e!rne,

!ut-or .!,e it #er/ "e!r t-!t in !

ontr!t re"!ting to o..eri!" enterprise

t-e Court is strong"/ in"ine, to -o",

ti.e to 5e essenti!"7 :-et-er t-e ontr!t

is for t-e pur-!se of "!n, or for su-

purposes or .ore ;,iret"/ for t-e

proseution of tr!,e<% T-e e"!5or!tion of

t-is point 5/ t-e "e!rne, !ut-or is !s

fo""o:s4

)+')% An, so7 !g!in7 :-ere t-e o56et of t-e

ontr!t is ! o..eri!" enterprise7 t-e Court

is strong"/ in"ine, to -o", ti.e to 5eessenti!"7 :-et-er t-e ontr!t 5e for t-e

pur-!ser of "!n, for su- purposes7 or .ore

,iret"/ for t-e proseution of tr!,e% T-is

prinip"e -!s 5een !te, on in t-e .!tter of !

ontr!t respeting "!n, :-i- -!, 5een

pur-!se, for t-e eretion of .i""s7 !"so in

re"!tion to ! s!"e of p!sture "!n,s7 reuire, 5/

t-e pur-!ser7 !s t-e #en,or ne:7 for sto?ing7

!n, in se#er!" !ses of ontr!ts for t-e s!"e

of pu5"i4-ouses !s going onerns% (p!ge +$

=)% T-e !fores!i, prinip"es su!re"/ !pp"/ to

t-e f!ts of t-e present !se% Here t-e

33



pur-!ser is !,.itte,"/ in t-e 5usiness of

5ui",ing onstrution !n, is entering :it-

!gree.ent for pur-!sing t-e p"ot on

o..eri!" 5!sis%

42. *areth +ones and illiam *oodhart in t-eir

Treaties on S!eciic )erormance (Second

Edition, utterworths epresse, si.i"!r

#ie:s 5/ s!/ing

If t-e p!rties -!#e epress"/ !gree, t-!t

ti.e is to 5e of t-e essene7 t-e ourts :i""

gener!""/ if not !":!/s gi#e effet to t-!t

stipu"!tion% An intention t-!t ! stipu"!tion !s

to ti.e s-ou", 5e of t-e essene .!/ 5e i.p"ie,fro. t-e iru.st!nes% In t-e !5sene of

!gree.ent to t-e ontr!r/7 ti.e :i"" gener!""/

5e onsi,ere, of t-e essene in .er!nti"e

ontr!ts !n, in ontr!ts for t-e s!"e of !

5usiness or of propert/ :-i- -!s ! f"utu!ting

or speu"!ti#e #!"ue% (p!ge 8=$

=1% T-e inst!nt !se o5#ious"/ re"!tes to !

ontr!t in o..eri!" tr!ns!tion !n, t-e

Court !n t!?e 6u,ii!" notie of t-e f!t

t-!t in t-e it/ of C-enn!i t-e prie of

34



re!" est!te is onst!nt"/ es!"!ting !n,

t-e "e!r intention of t-e p!rties7 !s it

!ppe!rs fro. t-e stipu"!tions of t-e

!gree.ent7 :!s to tre!t ti.e !s t-e

essene of t-e ontr!t%

==% H!#ing reg!r, to t-e !fores!i, prinip"es

t-e ourt !nnot !ttri5ute ! ,ifferent

intention to t-e p!rties !n, !nnot

speifi!""/ enfore t-e ontr!t !t t-e

inst!ne of t-e p"!intiff4pur-!ser :-o

-!s f!i"e, to perfor. -is p!rt of t-e

o5"ig!tion :it-in t-e ti.e stipu"!te,%

45. In .. V,"#"," "#, '*&!$ #% V"!"("#

reporte, in ()338$ 1 SCC ) t-is Court

ep"!ine, -o: ,isretion is to 5e

eerise, 5/ t-e Court 5efore gr!nting

speifi perfor.!ne% T-is Court -e",

t-!t in !ses of ur5!n properties in In,i!

it is :e"" ?no:n t-!t pries !re going up

35



s-!rp"/ o#er t-e "!st fe: ,e!,es

p!rtiu"!r"/ !fter )381% In V,"#","

(supr!$ t-e ourt :!s ,e!"ing :it- !

propert/ in M!,ur!i in t-e St!te of T!.i"

N!,u !n, it :!s !rgue, 5efore t-is Court

5/ referring to t-e M!,r!s Hig- Court

6u,g.ent in .V. "#9"!"+#/" N","! #%

P.T.. R"*#"$" N","! (AIR )3& M!, 1'3$

t-!t .ere rise in prie is no groun, for

,en/ing t-e speifi perfor.!ne% T-is

Court ,i, not !gree :it- t-e ,eision of

t-e M!,r!s Hig- Court !n, -e", t-!t t-e

Court !nnot 5e o5"i#ious of t-e re!"it/

of onst!nt !n, ontinuous rise in t-e

#!"ue of ur5!n properties% In t-!t

ontet t-e ti.e "i.it set in t-e ontr!t

-!s to 5e strit"/ onstrue,% In t-e !se

of V,"#"," (supr!$ t-ere is no su-

strit stipu"!tion !s ti.e 5eing of t-e

essene of t-e ontr!t !s is in t-e

inst!nt !se e#en t-en t-e Court refuse,

36



to gr!nt t-e re"ief of speifi

perfor.!ne%

46. In V,"#"," (supr!$ referene :!s .!,e

to ! Constitution 9en- 6u,g.ent of t-is

Court in C"#, R"# :*.; :D&",; - LR$.

#% ""+ R"# :*.; :D&",; - LR$.

reporte, in ()331$ ) SCC )3% T-e s!.e

uestion7 :-et-er ti.e :!s of essene of

t-e ontr!t :!s ,isusse, in C"#, R"#

(supr!$% T-e Constitution 9en- of t-is

Court :-i"e ,e!"ing :it- t-is uestion

referre, to !not-er ,eision of t-is Court

in t-e !se of M<$. H#, C'#$*!)*'#

C'#*!")*'!$ - *$ $'+& !'!&*'!

B9")"#, M+)"#, J"# :D&",; - LR$.

#% *"*& '% M""!"$*!" reporte, in ()383$

& SCC 8+% 9/ referring to #!rious

6u,g.ents7 t-e Constitution 9en- in C"#,

R"# (supr!$ for.u"!te, t-e proposition

t-!t e#en :-ere p!rties -!#e epress"/

37



pro#i,e, ti.e to 5e of t-e essene of t-e

ontr!t7 su- ! stipu"!tion :i"" -!#e to

5e re!, !"ong :it- ot-er ter.s of t-e

ontr!t% Su- ot-er ter.s7 on ! proper

onstrution7 .!/ e"u,e t-e inferene

t-!t t-e o.p"etion of :or? 5/ !

p!rtiu"!r ,!te :!s .e!nt to 5e

fun,!.ent!"% T-e "e!rne, Ju,ges in,i!te,

t-e fo""o:ing iru.st!nes :-i- .!/

in,i!te ! ontr!r/ inferene@ (!$ if !

ontr!t in"u,es "!uses pro#i,ing for

etension of ti.e in ert!in

ontingenies7 or (5$ if t-ere !re "!uses

for p!/.ent of fine or pen!"t/ for e#er/

,!/ or :ee? t-e :or? un,ert!?en re.!ins

unfinis-e, !fter t-e epir/ of ti.e% T-e

Constitution 9en- -e", t-!t su- "!uses

:ou", 5e onstrue, !s ren,ering

ineffeti#e t-e epress pro#ision re"!ting

to ti.e 5eing of t-e essene of ontr!t

(see p!r! && !t p!ge &' of t-e report$%

38



=8% In t-e inst!nt !se7 in t-e s!i, !gree.ent

no su- "!use7 !s !fores!i,7 eists%

R!t-er t-e stipu"!tion !s ti.e 5eing of

t-e essene of t-e ontr!t :!s

speifi!""/ .entione, in "!use )+ !n,

t-e onseuenes of non4o.p"etion !re

.entione, in "!use 3% So fro. t-e

epress ter.s of t-e ontr!t !n, t-e

o..eri!" n!ture of t-e tr!ns!tion !n,

t-e surroun,ing iru.st!nes .!?e it

"e!r t-!t t-e p!rties inten,e, ti.e in

t-is !se :!s inten,e, to 5e of t-e

essene of t-e ontr!t%

='% eeping t-e !5o#e prinip"e if :e "oo? !t

t-e portion of L!: in In,i!7 it is "e!r

t-!t un,er Setion 3 of t-e Speifi

Re"ief At7 )321 it is pro#i,e, !s

fo""o:s4

39



3% Defenes respeting suits for re"ief 5!se,

on ontr!t%4 Eept !s ot-er:ise pro#i,e,

-erein7 :-ere !n/ re"ief is "!i.e, un,er t-is

C-!pter in respet of ! ontr!t7 t-e person

!g!inst :-o. t-e re"ief is "!i.e, .!/ p"e!, 5/

:!/ of ,efene !n/ groun, :-i- is !#!i"!5"e to-i. un,er !n/ "!: re"!ting to ontr!ts%

=3% It is "e!r fro. Setion 3 of t-e Speifi

Re"ief At7 )321 t-!t Setion of T-e

In,i!n Contr!t At7 )'8& en!5"es !

,efen,!nt !g!inst :-o. suit for t-e

speifi perfor.!ne -!s 5een fi"e, to

r!ise t-e ,efene un,er Setion of t-e

In,i!n Contr!t At%

+% Setion of t-e In,i!n Contr!t At

:-i- ,e!"s :it- ! ontr!t7 in :-i- ti.e

is of essene is !s fo""o:s4

Setion 4 Effet of f!i"ure to perfor. !t !fie, ti.e7 in ontr!t in :-i- ti.e is

essenti!"% 4 G-en ! p!rt/ to ! ontr!t

pro.ises to ,o ! ert!in t-ing !t or 5efore !

speifie, ti.e7 or ert!in t-ings !t or 5efore

speifie, ti.es7 !n, f!i"s to ,o !n/ su- t-ing

!t or 5efore t-e speifie, ti.e7 t-e ontr!t7

or so .u- of it !s -!s not 5een perfor.e,7

40



5eo.es #oi,!5"e !t t-e option of t-e pro.isee7

if t-e intention of t-e p!rties :!s t-!t ti.e

s-ou", 5e of t-e essene of t-e ontr!t%

51. On ! o.5ine, re!,ing of Setion 3 of t-e

Speifi Re"ief At !n, Setion of T-e

In,i!n Contr!ts At it is "e!r t-!t in

t-is !se t-e #en,or !s ! pro.isee7 :!s

:it-in its rig-t to ter.in!te t-e ontr!t

5/ sen,ing t-e "etter ,!te, =t- Septe.5er7

)332 in ter.s of C"!use 3 of t-e Contr!t

:-i"e returning t-e !,#!ne .one/ of

Rs%)+7++7+++*4% It is "e!r t-!t t-e

p"!intiff -!s not ,is-!rge, its 5ur,en

:it-in t-e ti.e speifie, !n, is not

entit"e, to ! speifi perfor.!ne of t-e

ontr!t%

&% T-erefore7 t-e !ppro!- of t-e Hig- Court

5ot- 5/ t-e Sing"e Ju,ge !n, t-e Appe""!te

9en- !nnot 5e sust!ine,%

41



1% T-ere is !not-er !spet of t-e .!tter

!"so% In t-e inst!nt !se 5/ !s?ing for

speifi perfor.!ne of t-e ontr!t7 t-e

p"!intiff4pur-!ser is pr!/ing for !

,isretion!r/ re.e,/% It is !io.!ti

t-!t :-en ,isretion!r/ re.e,/ is pr!/e,

for 5/ ! p!rt/7 su- p!rt/ .ust o.e to

ourt on proper ,is"osure of f!ts% T-e

p"!int :-i- it fi"e, 5efore t-e Court in

su- !ses .ust st!te !"" f!ts :it-

suffiient !n,our !n, "!rit/% In t-e

inst!nt !se t-e p"!intiff4pur-!ser .!,e

!n !#er.ent in t-e p"!int t-!t t-e

,efen,!nt4#en,or 5e ,irete, to return t-e

!,#!ne !.ount of Rs%)+7++7+++*4 !t t-e

r!te of &=K interest fro. t-e ,!te of

p!/.ent of t-e s!i, !.ount ti"" t-e

re!"iB!tion !n, !n !"tern!ti#e pr!/er to

t-!t effet :!s !"so .!,e in t-e pr!/er

"!use ($%

42



54. Ho:e#er7 t-e f!t re.!ins t-!t prior to

t-e fi"ing of t-e suit t-e ,efen,!nt4

#en,or returne, t-e s!i, !.ount of

Rs%)+7++7+++*4 5/ its "etter ,!te, =t-

Septe.5er7 )332 5/ !n !ount p!/ee -eue

in f!#our of t-e p"!intiff !n, t-e s!.e

:!s sent to t-e p"!intiff un,er registere,

post :-i- :!s refuse, 5/ t-e p"!intiff on

2%3%)332% T-e p"!intiff suppresse, t-is

f!t in t-e p"!int !n, fi"e, t-e suit on

3%3%)332 :it- ! tot!""/ ontr!r/

represent!tion 5efore t-e ourt !s if t-e

!.ount -!s not 5een returne, to it 5/ t-e

#en,or% T-is is suppression of ! .!teri!"

f!t7 !n, ,isentit"es t-e p"!intiff4

pur-!ser fro. getting !n/ ,isretion!r/

re"ief of speifi perfor.!ne 5/ Court%

55. In t-is onnetion :e .!/ refer to t-e

Prinip"e of Euit!5"e Re.e,ies 5/ I%C%F%

SPR7 Fourt- E,ition (S:eet 0 M!:e""7

43



)33+$% De!"ing :it- t-e uestion of ;C"e!n

H!n,s< t-e "e!rne, !ut-or opine, t-!t

:-ere t-e p"!intiff is s-o:n to -!#e

.!teri!""/ .is"e, t-e ourt or to -!#e

!5use, its proess7 or to -!#e !tte.pte,

to ,o so7 t-e ,isretion!r/ re"ief of

speifi perfor.!ne !n 5e ,enie, to -i.%

In "!/ing ,o:n t-is prinip"e7 t-e "e!rne,

!ut-or re"ie, on ! ,eision of t-e Eng"is-

Court in t-e !se of A!$*!'#/ #% &"!,

= '!* L*,. ()33$ & Q%9% 1'= !t p!ge

138% (See SPR Euit!5"e Re.e,ies p!ge

&=1$%

56. T-is Court -!s !"so t!?en t-e s!.e #ie: in

t-e !se of A!#" B"!" #% U#'# '%

I#," "#, '*&!$ reporte, in (&++8$ 2 SCC

)&+% At p!r!gr!p- )&7 p!ge )& of t-e

report7 t-is Court -e", t-!t it is trite

"!: t-!t to en!5"e t-e ourt to refuse to

eerise its ,isretion!r/ 6uris,ition

44



suppression .ust 5e of ! .!teri!" f!t%

T-is Court7 of ourse7 -e", :-!t is !

.!teri!" f!t7 suppression :-ereof :ou",

,isentit"e t-e suitor to o5t!in !

,isretion!r/ re"ief7 :ou", ,epen, upon

t-e f!ts !n, iru.st!nes of e!- !se%

Ho:e#er7 5/ :!/ of gui,!ne t-is Court

-e", t-!t .!teri!" f!t :ou", .e!n t-!t

f!t :-i- is .!teri!" for t-e purpose of

,eter.in!tion of t-e "is%

8% Fo""o:ing t-e !fores!i, tests7 t-is Court

is of t-e opinion t-!t t-e suppression of

t-e f!t t-!t t-e p"!intiff refuse, to

!ept t-e -eue of Rs%)+ "! sent to it

5/ t-e ,efen,!nt un,er registere, post

:it- A%D% in ter.s of C"!use 3 of t-e

Contr!t is ! .!teri!" f!t% So on t-!t

groun, t-e p"!intiff4pur-!ser is not

entit"e, to !n/ re"ief in its suit of

speifi perfor.!ne%

45



58. For t-e re!sons !fores!i,7 t-is Court

!""o:s t-e !ppe!" fi"e, 5/ M*s% Cit!,e"

Fine P-!r.!euti!"s SLP(C$

No%&'&)*&++' !n, ,is.isses t-e !ppe!"

fi"e, 5/ t-e M*s R!.!ni/!. Re!" Est!tes P%

Lt,%7 SLP(C$ No%1)&23*&++'%

59. T-e Court ,irets M*s% Cit!,e" Fine

P-!r.!euti!"s to return t-e !.ount of

Rs%)+7++7+++*4 5/ !n !ount p!/ee -eue

to M*s% R!.!ni/!. Re!" Est!tes P% Lt,%7 if

not !"re!,/ returne,7 :it-in = :ee?s fro.

,!te% In ,ef!u"t M*s% Cit!,e" Fine

P-!r.!euti!"s :i"" -!#e to p!/ interest

!t t-e r!te of )&K per !nnu. on t-e s!.e

fro. t-e epir/ of t-e perio, of = :ee?s

fro. ,!te ti"" !tu!" p!/.ent%

46



2+% H!#ing reg!r, to t-e f!ts !n,

iru.st!nes of t-is !se t-ere :i"" 5e

no or,er !s to osts%

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(>%S% SIN>HVI$

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Ne: De"-i (ASO UMAR >AN>UL$

August +'7 &+))

Documents

Citadel Fine Pharmaceuticals v. Ramaniyam Real Estates (P) Ltd (2011) 9 SCC 147