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Issues: (i) Whether the plaintiff had pleaded and proved continuous readiness and willingness to perform his part of the contract so as to obtain specific performance; (ii) whether the agreement was a contingent contract incapable of enforcement; (iii) whether the principle of marshalling by a subsequent purchaser could be applied in favour of the decree-holder and whether costs and ancillary directions were justified.
Issue (i): Whether the plaintiff had pleaded and proved continuous readiness and willingness to perform his part of the contract so as to obtain specific performance.
Analysis: Section 16(c) of the Specific Relief Act, 1963 makes readiness and willingness a condition precedent for specific performance. The Court found that the plaintiff had pleaded part-payment, produced documentary evidence of financial capacity, maintained funds for completion, and consistently pursued performance. The conduct of the parties, including the subsequent agreement and further advances paid, supported the finding that the plaintiff was ready and willing throughout.
Conclusion: The requirement of readiness and willingness was proved and the decree for specific performance could not be denied on that ground.
Issue (ii): Whether the agreement was a contingent contract incapable of enforcement.
Analysis: A contingent contract under Sections 31 and 32 of the Indian Contract Act, 1872 depends on an uncertain future event before enforcement can arise. The Court held that the later agreement governed the parties, that the obligation to clear the bank dues and produce title deeds was an incidental covenant and not an impossible condition, and that the contract was capable of performance. The execution of the sale deed was only postponed pending discharge of the mortgage, not made contingent on an impossible event.
Conclusion: The contract was not contingent or void, and it remained enforceable.
Issue (iii): Whether the principle of marshalling by a subsequent purchaser could be applied in favour of the decree-holder and whether costs and ancillary directions were justified.
Analysis: Section 56 of the Transfer of Property Act, 1882 entitles a subsequent purchaser to require the mortgage debt to be worked out first against the properties not sold to him, without prejudicing the mortgagee. The Court held that, in the context of the larger relief claimed and the decree for specific performance, the High Court was justified in applying the doctrine to protect the decree-holder while safeguarding the Bank's rights. The award of costs was also upheld because the plaintiff had paid substantial court fee and substantially succeeded. The directions issued in relation to recovery proceedings were treated as consistent with the overall equitable relief and not as an impermissible interference with the tribunal's order.
Conclusion: The application of marshalling, the award of costs, and the ancillary directions were upheld.
Final Conclusion: The Court found no reason to interfere with the High Court's decree for specific performance and connected equitable directions, and the appeals failed.
Ratio Decidendi: In a suit for specific performance, continuous readiness and willingness must be proved by pleading, conduct, and financial capacity, and where the contract is otherwise performable, equitable relief including marshalling may be moulded to protect the decree-holder without prejudicing the mortgagee.
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