Specific performance barred by inequitable conduct and exchange-control limits where Reserve Bank permission was required for transfer.

Specific performance is discretionary and may be refused where the plaintiff lacks bona fides or seeks unfair advantage. The court treated the plaintiff's attempt to secure the property while avoiding rent obligations, together with the claim of ownership without a sale deed, as inequitable conduct that disentitled him to relief. Enforcement was also considered impermissible because transfer of immovable property owned by a non-citizen required prior Reserve Bank permission; a decree should not be made if it would bypass mandatory exchange-control requirements or be incapable of execution. The court further noted that reliance on a confidential relationship and unsupported valuation claims weighed against equitable relief.

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Issues: (i) whether the plaintiff was entitled to specific performance of the alleged agreement for sale in the exercise of equitable discretion; (ii) whether enforcement of the agreement would be contrary to statutory prohibitions and public policy in view of the foreign national status of the owner and the need for Reserve Bank permission; (iii) whether the plaintiff's conduct, including the claim of ownership and non-payment of rent, disentitled him to relief.

Issue (i): whether the plaintiff was entitled to specific performance of the alleged agreement for sale in the exercise of equitable discretion

Analysis: Specific performance is not granted as of right but only on sound judicial discretion under the law of specific relief. The plaintiff's pleadings and conduct showed an attempt to secure the property while avoiding rent obligations, and the Court treated the suit as lacking bona fides. The alleged bargain was also viewed against the background of unequal reliance on valuation reports and the plaintiff's dominant position as tenant in possession.

Conclusion: The plaintiff was not entitled to specific performance.

Issue (ii): whether enforcement of the agreement would be contrary to statutory prohibitions and public policy in view of the foreign national status of the owner and the need for Reserve Bank permission

Analysis: The proposed transfer of immovable property owned by a non-citizen required prior permission of the Reserve Bank under the foreign exchange law. The Court held that a decree for specific performance should not be made when its enforcement would bypass mandatory exchange-control requirements or result in a decree that may not be capable of execution. The statutory scheme and the public policy underlying exchange control were treated as decisive against enforcement.

Conclusion: Enforcement of the agreement was held to be impermissible and opposed to public policy.

Issue (iii): whether the plaintiff's conduct, including the claim of ownership and non-payment of rent, disentitled him to relief

Analysis: The plaintiff had asserted ownership from an earlier date notwithstanding the absence of a sale deed, and that stance was viewed as an attempt to defeat rent liability. The Court also found that he exploited the defendant's confidence and confidential relationship, without establishing fair dealing or independent proof of the true market value. Such conduct was held incompatible with equitable relief.

Conclusion: The plaintiff's conduct disentitled him to relief.

Final Conclusion: The decree for specific performance could not stand, and the suit was dismissed on equitable and statutory grounds.

Ratio Decidendi: A court will refuse specific performance where enforcement would require violation of mandatory statutory requirements or would otherwise be inequitable because the plaintiff has acted without bona fides or sought unfair advantage through a confidential relationship.

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