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R. Velammal vs R. Daivasigamani And Others on 21 April, 1992

13. The entire controversy on which the granting or refusing the relief of specific performance of contract in this case hanging, is that the property in suit was subject to the charge of the Bank, to whom it was mortgaged. The trial Court did not thought it proper to grant relief of specific performance of contract as the plaintiff in his oral evidence has stated that had he been aware of the fact that the property was mortgaged one, he would not have entered into agreement. On that ground the trial Court opined that plaintiff is not ready to buy the property subject to encumbrance. And, that is why Instead of decreeing the suit for specific performance it directed to refund the amount to the plaintiff accepted by the defendant with interest. However, the first appellate Court relying on principle of law laid down in R. Velammal v. R. Daivasigamani, , decreed the suit for specific performance as it was found that there is no legal impedment sale of property subject to encumbrabce. This Court is also of the view that a suit can be decreed for specific performance of contract for sale of property even if it is subject to encumbrance provided that the plainon is willing to purchase the property subject to such encumbrance.
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