2007 (8) TMI 775 - SC - Indian Laws

High Court Appeal Dismissed for Lack of Merit: Land Agreement Voided by State Law

The Supreme Court upheld the High Court's decision, dismissing the appeal for lack of merit. The Court determined that the specific performance of the ... - Issues involved: Interpretation of the West Bengal Thika Tenancy (Acquisition and Regulation) Act, 1981 in relation to a specific performance agreement for sale u/s Indian Contract Act, 1872.Summary:The appeal was filed against the High Court's decision to dismiss a suit for specific performance of an agreement for sale, which was initially decreed by the Trial Court. The agreement was made in 1973 under the Calcutta Thika Tenancy Act, 1949, but during the suit, the 1981 Act was enacted, which vested lands in the State and prohibited certain transfers.The key provisions of the 1981 Act include Section 5, which vests lands in the State, and Section 6(3), which prohibits certain transfers of thika tenancy interests. Section 7(2) declares any transfer in contravention of these provisions as void, with Section 4 having an overriding effect on all laws.The Court had to determine whether the specific performance of the agreement became impossible due to the 1981 Act. The Act significantly changed the concept of Thika tenancy, with the landlord's interest vesting in the State. The Indian Contract Act, 1872, Section 56 states that an agreement becomes void if the act becomes impossible, as in this case where the land vested in the State.The appellant argued that the rights under the 1949 Act were not affected by the 1981 Act, but the Court disagreed, stating that the agreement became void under the new law. The High Court ruled that the contract had become void, entitling the plaintiff to a refund of consideration, interest, and costs.Ultimately, the Supreme Court upheld the High Court's decision, dismissing the appeal for lack of merit.