Readiness and willingness in specific performance must match the contract; time may be of the essence, and lis pendens can defeat a later buyer.

Readiness and willingness in a specific performance claim must be tested against the contract as actually agreed, and not against a later demand for a different title position; on the stated facts, the plaintiff failed to prove continuous readiness and willingness. The short completion period, forfeiture clause, and surrounding mortgage proceedings showed that time was of the essence, so equitable relief could be refused where enforcement would cause hardship and upset the contractual bargain. A subsequent purchaser could still contest readiness and willingness in appeal, and additional evidence relevant to discretion was admitted. A transfer made after institution of the suit remained subject to lis pendens, so bona fide purchaser protection was unavailable; the specific performance decree was set aside and replaced with limited monetary relief against the vendor.

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Issues: (i) whether the plaintiff had proved readiness and willingness to perform the essential terms of the contract; (ii) whether time was of the essence of the contract and whether specific performance should be refused in the exercise of discretion; (iii) whether the defendant-appellant could contest the issue of readiness and willingness and adduce additional evidence in appeal; and (iv) whether the transfer in favour of the subsequent purchaser was protected against specific performance.

Issue (i): whether the plaintiff had proved readiness and willingness to perform the essential terms of the contract.

Analysis: The contract, read as a whole, required the purchaser to take the property on the agreed footing, subject to the stated encumbrances, and to complete the transaction within the stipulated period. The correspondence showed that the plaintiff insisted upon a marketable title free from the mortgage and connected proceedings, which was contrary to the true construction of the agreement. Readiness and willingness under Section 16 of the Specific Relief Act, 1963 required compliance with the contract as actually agreed, not as the plaintiff later sought to recast it.

Conclusion: The plaintiff failed to prove continuous readiness and willingness.

Issue (ii): whether time was of the essence of the contract and whether specific performance should be refused in the exercise of discretion.

Analysis: The agreement fixed a short period for completion, contained a forfeiture clause, and was entered into against the background of a mounting mortgage liability and pending proceedings. Those circumstances showed that prompt completion was central to the bargain. Under Section 55 of the Indian Contract Act, 1872 and Section 20 of the Specific Relief Act, 1963, the Court had to consider whether enforcement would be inequitable or confer an unfair advantage. On the facts, granting specific performance would have disregarded the contractual time structure and imposed hardship on the vendors and the subsequent purchaser.

Conclusion: Time was held to be the essence of the contract and specific performance was refused in the exercise of discretion.

Issue (iii): whether the defendant-appellant could contest the issue of readiness and willingness and adduce additional evidence in appeal.

Analysis: The law prevailing at the time of the trial had limited the subsequent purchaser's right to contest readiness and willingness, but that position was later overruled before disposal of the appeal. Since an appeal is a continuation of the original proceeding, the changed law governed the matter at the appellate stage. The documents sought to be produced were relevant to the discretionary relief question and satisfied the requirements for additional evidence in appeal.

Conclusion: The defendant-appellant was permitted to contest the issue and the additional evidence was admitted.

Issue (iv): whether the transfer in favour of the subsequent purchaser was protected against specific performance.

Analysis: The sale in favour of the subsequent purchaser took place after institution of the suit and was therefore hit by lis pendens under Section 52 of the Transfer of Property Act, 1882. The protection available to a bona fide transferee for value without notice under Section 19(b) of the Specific Relief Act, 1963 was not available in the circumstances.

Conclusion: The subsequent purchaser could not resist the decree on the basis of bona fide purchase without notice.

Final Conclusion: The decree for specific performance was set aside, the suit was converted into a limited money decree for refund and damages against the vendor, and the claim against the subsequent purchaser was rejected.

Ratio Decidendi: In a suit for specific performance, the plaintiff must prove readiness and willingness according to the true construction of the contract, and where the agreement and surrounding circumstances show that prompt completion was essential, the Court may refuse specific performance under its equitable discretion if enforcement would confer an unfair advantage or cause hardship.

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