Quick answer: In V.N.A.S. Chandran v. Mrs. S. Venila and Others, 2026 INSC 776, decided on 31 July 2026, the Supreme Court set aside a Madras High Court decree of specific performance and restored the trial court’s decree confining the buyers to a refund of their ₹85,00,000 advance with interest at 15% per annum, secured by a charge on the property under Section 55(6)(b) of the Transfer of Property Act, 1882. The refusal did not rest on a finding that the buyers lacked funds. It rested on their conduct: a retaliatory criminal complaint demanding recovery of the very advance they were suing to convert into a conveyance, irreconcilable positions taken in parallel proceedings about whether their rights had been assigned to a third party, and an onward agreement to sell the property at a lower price while the original agreement was still on foot. Over two decades of delay and hardship to an elderly seller reinforced the refusal. Because the agreement predated the Specific Relief (Amendment) Act, 2018, the discretion under the unamended Section 20 was available.
Key Takeaways
- Conduct, not capacity, decided this case. The Court accepted that the buyers “may have been desirous of purchasing the suit property and even took steps towards it” — and still refused relief, because their subsequent conduct countervailed an equitable remedy.
- A “counterblast” FIR is no excuse. That the buyers’ criminal complaint answered the seller’s earlier one did not neutralise it. Asking the police to recover the advance is inconsistent with asking a civil court to compel conveyance.
- Inconsistent positions across proceedings are fatal. Asserting in one suit that rights had been validly assigned to a third party, and in another that no assignment ever occurred, is a contradiction “impossible to reconcile”.
- A plaintiff who stays out of the witness box cannot disown a spouse’s conduct. Plaintiff No. 1 neither repudiated her husband’s actions nor testified, and could not rely on the technicality that he, not she, lodged the complaint.
- Cross-objections are not needed to attack a finding. Affirming S. Nazeer Ahmed v. State Bank of Mysore (2007), a respondent supporting a decree may impugn an adverse finding under Order XLI Rule 22 CPC without cross-objecting, provided no relief beyond the decree is sought.
- Failure on the primary remedy is not forfeiture. The advance came back with interest and a statutory charge over the property.
1. Introduction
The commonest way to read a refused specific performance claim is as a failure of proof: the buyer could not show the money. V.N.A.S. Chandran v. Mrs. S. Venila and Others is a more uncomfortable decision than that, and a more useful one. The Supreme Court did not hold that these buyers were unable to complete. It held that people who behave as they had behaved should not receive an equitable remedy, however able they were to pay.
The dispute concerned an Agreement to Sell dated 1 April 2004 over immovable property at Udhagamandalam (Ooty), Tamil Nadu, for a total consideration of ₹2,25,00,000, of which the buyers claimed to have paid ₹85,00,000 in advance. Twenty-two years and four appeals later, the Court restored the trial court’s original disposal: no conveyance, but the advance returned with interest and secured on the property.
Two features make the judgment worth close attention. The first is doctrinal emphasis. The Court’s operative reasoning runs through Section 20 of the Specific Relief Act, 1963 and the conduct of the plaintiff, quoting Major Gen. Darshan Singh v. Brij Bhushan Chaudhary (2024) for the proposition that “a person who seeks equity must do equity”. Readiness and willingness under Section 16(c) is discussed, but the case is not decided on it. The second is the range of conduct the Court was prepared to count: not fraud, not forgery, but litigation positions that could not stand together.
This article sets out the facts and the procedural history, analyses the conduct-based ratio and the subsidiary holdings on cross-objections and declaratory relief, and then draws out what the decision means for buyers, sellers and appellate practitioners.
2. Case summary and background
The seller was the appellant, V.N.A.S. Chandran (Defendant No. 1). The purchaser under the agreement was Plaintiff No. 1, S. Venila; her husband, Plaintiff No. 2, held the seller’s Power of Attorney and gave an undertaking on the date of the agreement. He was, as the Court put it, “central to the transaction” from the inception.
Performance was not straightforward. Clause 7 of the agreement referred to an interim injunction in a partition suit, and completion was contingent on an ex parte decree being set aside and on tenants vacating — matters the trial court later found lay outside the buyers’ control.
Payments were made and, where instruments failed, made good. Of three cheques of ₹25,00,000 each, the first was dishonoured for want of funds; the seller then acknowledged, by letter dated 10 April 2004, receipt of ₹25,00,000 in two instalments of ₹15,00,000 and ₹10,00,000 in lieu of it, and returned the cheque. Of two later cheques of ₹5,00,000 each, one was honoured and, in respect of the other, payment was made. The seller disputed the total, admitting only ₹60,00,000; the trial court found ₹85,00,000 had been received.
The conduct that decided the case came later. While the agreement subsisted and payments were being made under it, Plaintiff No. 2 entered a sub-agreement to sell the same property to Defendant No. 5 for ₹1,50,00,000 — appreciably less than the price under the head agreement — and took an advance. The Power of Attorney and sub-agreement were later cancelled and that advance refunded, and Defendant No. 5’s suit, OS No. 75 of 2005, was dismissed, its interim injunction of 11 June 2005 having been vacated on 10 August 2005. In dismissing it, the Sub-Court recorded that the suit had been undervalued to invoke its jurisdiction and that Defendant No. 5 had acted “hand in hand” with Plaintiff No. 2, being no more than a “tool”, “name-lender” or “puppet plaintiff”.
Then came the criminal complaints. The seller lodged one against Plaintiff No. 2 before the Judicial Magistrate No. 2, Madurai, alleging robbery and threats at the property. On 27 December 2005, Plaintiff No. 2 lodged a counter-complaint asking the police to trace the seller and recover ₹85,00,000 from him, alleging the money had been obtained by fraudulently suppressing the injunction in the partition suit — despite Clause 7 expressly referring to it. That counter-complaint did not disclose the pending civil proceedings.
The trial court, by judgment dated 22 November 2007, framed ten issues and decreed the suit only to the extent of refund of ₹85,00,000 with interest at 15% per annum from the date of suit until realisation, creating a charge on the property under Section 55(6)(b) of the Transfer of Property Act, 1882, and dismissed it otherwise. It found no valid assignment to Defendant No. 5; that time was not strictly of the essence, performance being contingent on events beyond the buyers’ control; and that the buyers, blowing hot and cold, had not come with clean hands and so were not entitled to relief under Section 20.
The High Court, in AS No. 443 of 2008, reversed on 11 October 2011. It admitted additional evidence under Order XLI Rule 27 CPC (marked Ex. A-48), held on S. Nazeer Ahmed that the seller could assail an adverse finding without cross-objecting, characterised the buyers’ complaint as a mere counterblast, held that the seller had not pleaded want of funds and could not raise it first on appeal, and treated a demand draft for ₹1,40,00,000 dated 14 June 2011 produced at the hearing as proof of continuing readiness. It decreed specific performance on deposit of ₹1,40,00,000.
The Supreme Court, in Civil Appeals Nos. 7825–7828 of 2013 decided by Prashant Kumar Mishra and N.V. Anjaria JJ, allowed the seller’s appeals, set aside that decree, and restored the trial court’s judgment, permitting the buyers to withdraw the ₹1,40,00,000 they had deposited on 12 November 2011 together with accrued interest, with no order as to costs.
3. Legal analysis
3.1 The framework: Section 20 and the pre-2018 regime
Because the agreement was executed in 2004, the case fell under the unamended Act, where specific performance was discretionary rather than presumptive. The Court set out the settled position through N.P. Thirugnanam v. Dr. R. Jagan Mohan Rao (1995), Nanjappan v. Ramasamy (2015) and Kamal Kumar (2019). The last supplies the five-question checklist a court works through: a valid concluded contract; readiness and willingness; actual performance and its extent; whether relief would be equitable or cause hardship to the defendant; and whether some alternative relief, such as refund of earnest money, is due.
That fourth question is where this case was decided, and it is worth stressing how the Court used the framework. It did not find the buyers in breach of Section 16(c). N.P. Thirugnanam is quoted at length on continuous readiness, and the discussion of conduct “prior and subsequent to the filing of the suit” in that passage is doing double duty — it belongs to the readiness inquiry, but it also opens the door to the discretionary assessment that follows.
3.2 Conduct as the operative ground
The Court’s own summation is the clearest statement of the ratio: the plaintiffs “may have been desirous of purchasing the suit property and even took steps towards it; however, their subsequent inconsistent conduct countervails the grant of an exceptional and equitable remedy”. Three strands made up that conduct.
The retaliatory complaint. The Court declined to accept the High Court’s characterisation of the buyers’ FIR as a benign counterblast. It acknowledged the provocation — the seller had lodged his own complaint at Madurai — but held that “the complaint itself being a ‘counterblast’ is no excuse in law; in fact, Courts generally censure these kind of retributive criminal proceedings.” The substantive objection was one of inconsistency: a party who asks the police to recover a sum of money is not simultaneously insisting on conveyance of the property that money was paid for. The chronology mattered too — the counter-complaint came well after both the seller’s complaint and the institution of the suit, and did not disclose the civil proceedings.
Irreconcilable positions on assignment. In legal notices dated 23 May 2005 and in the pleadings in OS No. 75 of 2005, the buyers’ position was that rights under the agreement had been assigned to Defendant No. 5 with the seller’s knowledge and consent, making the sub-agreement valid and binding. In the present suit they asserted that no assignment had occurred and that Plaintiff No. 1 alone remained entitled to specific performance. The Court expressly declined to decide whether the transaction amounted in law to an assignment, or to comment on its commercial rationale: what mattered was that “the Plaintiffs adopted two contradictory positions which are impossible to reconcile.”
Dealing with the property behind the seller’s back. The sub-agreement was made while the head agreement subsisted and payments were being made under it, at a materially lower price. The Court worked through both possibilities. If Plaintiff No. 2 acted as the seller’s attorney, he intended to alienate the property before title passed to his own wife, and for less. If he acted for his wife, her rights necessarily stood assigned to Defendant No. 5 — which is what the buyers denied in this suit. Either way the seller had a legitimate grievance, sharpened by having been made to face OS No. 75 of 2005 and an interim injunction obtained in it.
To this the Court added an evidentiary point of general application. Plaintiff No. 1 neither disowned her husband’s conduct nor entered the witness box, and could not therefore take advantage of the technical fact that he lodged the complaint. Relying on Janki Vashdeo Bhojwani v. IndusInd Bank (2004) and Rajesh Kumar v. Anand Kumar (2024), the Court held that the plaintiffs could not “seek to be treated as a composite unit when it benefits them, but resile from the position when it does not.”
The doctrinal anchor is Major Gen. Darshan Singh v. Brij Bhushan Chaudhary (2024): discretion under Section 20 depends on several factors, one being the plaintiff’s conduct, because “a person who seeks equity must do equity”. Muddam Raju Yadav v. B. Raja Shanker (2026) is quoted for the sterner formulation that even a slight doubt about the plaintiff’s bona fides, or material facts withheld, warrants refusal.
3.3 Delay and hardship
Delay entered as reinforcement rather than as the primary ground. Over two decades had passed since the agreement, and the Court invoked Saradamani Kandappan v. S. Rajalakshmi (2011) and Nanjappan for the proposition that such a lapse militates against specific performance. It then added the human facts: the seller is “today a man of highly advanced age” and Plaintiff No. 2 has died. Hardship to the defendant being a recognised factor under Section 20 on the authority of Kamal Kumar, the Court concluded that justice required restoring the parties to their pre-transaction positions.
It is worth being precise about what this does and does not establish. The Court did not hold that elapsed time alone defeats a claim, nor did it make any finding about price appreciation. Delay and hardship operated on a discretion that the conduct findings had already tilted. A practitioner citing Chandran for a freestanding delay proposition would be overreading it.
3.4 Cross-objections under Order XLI Rule 22
The Court affirmed — rather than created — the rule that a respondent supporting a decree may impugn a finding adverse to him without filing cross-objections, provided he seeks no relief beyond what the decree already grants. The authority is S. Nazeer Ahmed v. State Bank of Mysore (2007), applied by the High Court and endorsed here. Because the seller sought only to sustain the trial court’s refusal of specific performance, he was entitled to attack the readiness and willingness finding without cross-objecting.
This is a useful practical point precisely because it is not new: it is settled law that respondents in multi-tier appeals still get caught out by. Note the limit. The permission extends to findings, not to relief. A respondent who wants more than the decree gives must cross-object.
3.5 Declaratory relief and the maintainability objection
The seller also argued that the suit was not maintainable because the buyers had not sought a declaration that his termination of the agreement was invalid. The Court addressed this through Annamalai v. Vasanthi, which holds that declaratory relief is required where a doubt or cloud lies on the plaintiff’s right and the consequential relief depends on removing it — a question to be determined on the facts of each case rather than as a rule. The point did not ultimately drive the outcome, but the reasoning is worth noting for anyone framing a plaint where a contract has been purportedly terminated.
3.6 Assessment
The judgment’s strength is its honesty about what it is doing. It would have been easy to dress a conduct-based refusal in the language of Section 16(c) — to say the buyers were never really ready — and the record offered material for it. The Court declined, conceding that the buyers may genuinely have wanted and been able to complete, and refusing relief anyway. That is the correct use of an equitable discretion, and it makes the decision more candid than the many judgments that reach the same result by straining a readiness finding.
The reservation concerns predictability. Once inconsistency in litigation positions is enough to forfeit specific performance, a great deal turns on how strictly a court reads the parties’ pleadings across parallel proceedings — and Indian property litigation generates parallel proceedings as a matter of course. The Court’s insistence that it was not deciding whether an assignment had occurred, only that the two positions could not stand together, is disciplined; applied loosely by courts below, the same reasoning could penalise ordinary alternative pleading. The safeguard is that the conduct here was cumulative and included a criminal complaint seeking recovery of the consideration.
4. Practical significance
For buyers pursuing specific performance. Keep every position consistent across every forum. The single most damaging fact here was a criminal complaint demanding the money back, filed while a suit for conveyance was pending — a step that reads as an election between remedies whatever was intended. Never answer a seller’s criminal complaint with a retaliatory one; the Court said plainly that courts censure such proceedings. Where rights may have been dealt with in an onward transaction, address it in the plaint rather than denying it in one suit and asserting it in another. And the named purchaser must testify: a plaintiff who stays out of the witness box while a spouse or attorney runs the litigation cannot later disclaim what was done in her name.
On the transaction itself. Do not create third-party interests in the property while your own purchase is incomplete. An onward agreement at a lower price, made under a power of attorney granted by the seller, was read as evidence of bad faith on either available construction. If an assignment is intended, document it and disclose it.
For sellers defending such suits. Conduct is a defence in its own right, and it should be pleaded as one rather than folded into a want-of-funds case — particularly since the High Court here held the seller could not raise absence of funds for the first time on appeal, not having pleaded or deposed to it. Plead the plaintiff’s inconsistent positions with dates and documents, annex the pleadings from the parallel proceedings, and plead hardship specifically: age, intervening deaths, changed circumstances. Do not expect to keep the advance: a successful defence still left this seller repaying ₹85,00,000 with 15% interest from the date of suit, charged on the property.
For litigators on appeal. Use S. Nazeer Ahmed to attack adverse findings while supporting a decree, but keep the distinction between findings and relief firmly in view. Where the first appellate court has taken additional evidence under Order XLI Rule 27, engage with it rather than objecting to it late. And identify the applicable statutory regime at the outset: for a pre-October 2018 agreement, the discretionary framework of the unamended Section 20 is the battleground, and conduct arguments carry weight there that they would not carry under a purely Section 16-driven analysis.
5. Conclusion
V.N.A.S. Chandran v. S. Venila is a decision about the price of inconsistency. The buyers had a written agreement, had paid ₹85,00,000, had a High Court decree in hand, and had produced a demand draft for the balance in open court. They lost the property because, over the years of dispute, they had asked the police to recover their money while asking a civil court to compel a sale, and had told one court their rights were assigned while telling another they were not.
For pre-2018 agreements still working through the system, the message is that Section 20 discretion has real content. A plaintiff who satisfies Section 16(c) has not thereby earned a decree; the court still asks whether granting one would be equitable, and the plaintiff’s own conduct across the whole life of the dispute is admissible on that question. Delay and hardship to an elderly defendant will reinforce a refusal, but they did not create it here.
The counterweight, and it matters, is that refusal of the equitable remedy left the buyers with a monetary one: their advance, with interest at 15% from the date of suit, secured by a statutory charge on the property under Section 55(6)(b) of the Transfer of Property Act, 1882. Losing the house is not the same as losing the money.
The authorities relied on
| Case | Proposition |
|---|---|
| N.P. Thirugnanam v. Dr. R. Jagan Mohan Rao, (1995) 5 SCC 115 | Continuous readiness and willingness is a condition precedent; conduct before and after suit is relevant to judging it. |
| S. Nazeer Ahmed v. State Bank of Mysore, 2007 INSC 34 | A respondent supporting a decree may impugn an adverse finding without cross-objections where no additional relief is sought. |
| Saradamani Kandappan v. S. Rajalakshmi, 2011 INSC 446 | A long lapse of time militates against granting specific performance. |
| Nanjappan v. Ramasamy, 2015 INSC 152 | Summarises the pre-2018 discretionary position under Section 20. |
| Kamal Kumar, 2019 INSC 16 | Sets out the five questions in a specific performance suit; hardship to the defendant is a recognised discretionary factor. |
| Janki Vashdeo Bhojwani v. IndusInd Bank, 2004 INSC 695; Rajesh Kumar v. Anand Kumar, 2024 INSC 444 | A party cannot claim the benefit of a composite position while resiling from it when inconvenient. |
| Major Gen. Darshan Singh v. Brij Bhushan Chaudhary, 2024 INSC 157 | Discretion under Section 20 turns partly on the plaintiff’s conduct: one who seeks equity must do equity. |
| Muddam Raju Yadav v. B. Raja Shanker, 2026 INSC 214 | Even slight doubt as to the plaintiff’s bona fides, or material facts withheld, warrants refusal of the discretionary relief. |
| Annamalai v. Vasanthi | Declaratory relief is needed where a cloud on the plaintiff’s right must be removed for consequential relief to follow; determined on the facts of each case. |
Frequently Asked Questions
What did the Supreme Court decide in V.N.A.S. Chandran v. S. Venila?
It set aside a Madras High Court decree of specific performance and restored the trial court’s decree, which had confined the buyers to a refund of their ₹85,00,000 advance with 15% interest, charged on the property. The refusal rested on the buyers’ inconsistent conduct rather than on any finding that they lacked funds, reinforced by more than two decades of delay and hardship to an elderly seller.
Did the buyers lose because their cheques bounced?
No. Dishonours occurred early in the transaction but were made good — a dishonoured ₹25,00,000 cheque was replaced by cash instalments of ₹15,00,000 and ₹10,00,000 and the cheque returned. The Court accepted that the buyers may have been willing and able to complete. It refused relief because of their later conduct.
What conduct cost them the decree?
Three things: a criminal complaint asking the police to recover the ₹85,00,000 advance while a suit for conveyance was pending; asserting in parallel proceedings that their rights had been assigned to a third party while denying any assignment in this suit; and agreeing to sell the property onward at a lower price while the original agreement subsisted.
Does this case apply to agreements made after the 2018 amendment?
Its discretionary reasoning is most directly relevant to pre-October 2018 agreements, which remain governed by the unamended Section 20. Conduct remains relevant after the amendment, but the framework within which it operates is different, and this judgment does not address post-amendment agreements.
Is a plaintiff who fails to obtain specific performance left with nothing?
No. Here the buyers recovered their advance with interest at 15% per annum from the date of suit, secured by a charge on the property under Section 55(6)(b) of the Transfer of Property Act, 1882, and were permitted to withdraw the ₹1,40,00,000 they had deposited in 2011 with accrued interest.
Must a respondent file cross-objections to challenge an adverse finding?
Not where the respondent supports the decree and seeks no relief beyond it. The Court affirmed S. Nazeer Ahmed v. State Bank of Mysore (2007) on this point. Cross-objections remain necessary where the respondent wants something more than the decree already grants.
Can a purchaser rely on her husband or attorney to conduct the litigation?
Not safely. Plaintiff No. 1 neither disowned her husband’s conduct nor gave evidence, and could not escape its consequences on the basis that he, not she, had acted. The named purchaser should testify.
This article is not legal advice and does not create an attorney–client relationship. Readers should verify the certified copy of the judgment and any subsequent clarificatory orders before relying on it, and consult a qualified advocate on the facts of their matter.