+91 964 334 1948
10 Nov 2025, 07:30 AM
The Supreme Court on Monday (November 10) delivered a significant ruling interpreting the Specific Relief Act, 1963, holding that a party cannot unilaterally terminate a non-determinable agreement to sell, except where the contract itself is expressly determinable in nature under Section 14 of the Act. The Court further clarified that such invalid termination does not oblige the aggrieved party to first seek a separate declaration challenging the termination before pursuing a claim for specific performance.
“Unilateral termination of the agreement to sell by one party is impermissible in law, except in cases where the agreement itself is determinable in nature...If such unilateral termination of a non-determinable agreement to sell is permitted as a defence, then virtually every suit for specific performance can be frustrated by the defendant by placing an unfair burden on the plaintiff... who, despite performing his part of the obligations and having showcased readiness and willingness, would require to also seek a separate declaration that the termination was bad in law.", the court said.
A bench of Justices JB Pardiwala and R Mahadevan heard the case, which relates to an Agreement to Sell dated April 28, 2000, for 354 acres of agricultural land in Basavanakoppa village, Karnataka. The landowners had agreed to sell the property to a consortium led by the Patadia family and Muttanna for ₹26.95 lakh, receiving an advance of ₹9.45 lakh.
However, after delays caused by litigation over land tenure and tenant relocation, the original landowners unilaterally terminated the agreement in 2003 and later sold the same land to third parties in 2007, even though an injunction against alienation was in force.
The Patadia family sued for specific performance, asserting readiness and willingness to perform their part of the contract
The High Court decreed that the plaintiffs were entitled to specific performance, directing the subsequent purchasers to execute the sale deeds and deliver possession, with the plaintiffs required to pay the balance consideration.
While affirming the High Court's decree, the judgment authored by Justice Pardiwala clarified the broader principle that specific performance cannot be defeated by unilateral termination unless the contract itself allows such action.
“If a contract itself gives no right to unilaterally terminate the contract or such right has been waived and a party still terminates the contract unilaterally, then that termination would amount to a breach by repudiation and the non-terminating party can directly seek specific performance without first seeking a declaration.”, the court observed.
“In such cases, the burden cannot be casted upon the plaintiff to challenge the alleged termination... Where a party claims to have valid reasons to terminate... it should be such terminating party, if at all, who ideally should approach the court.”, the court added.
(Story to be updated upon uploading of Judgment)
Cause Title: K. S. MANJUNATH AND ORS. Versus MOORASAVIRAPPA @ MUTTANNA CHENNAPPA BATIL SINCE DECEASED BY HIS LRS AND ORS.