In the case of Gourave Gupta vs. Laxmi Rohra & Anr. (and a connected appeal), the Delhi High Court upheld the dismissal of two suits for specific performance regarding commercial shops in Jawahar Nagar. Justice Mini Pushkarna ruled that the appellants failed to prove a valid extension of the contract deadline, as a handwritten endorsement was signed by a third party (the co-owner’s son) who lacked the legal authority or Power of Attorney to bind the owner. Furthermore, the Court found that time was of the essence due to the respondents’ urgent financial liabilities and that the appellants failed to demonstrate their “readiness and willingness” to pay the balance consideration, as they lacked the necessary funds in their bank accounts and offered no documentary proof of financial capacity.
- Factual Background
The appellants (Gourave Gupta and M/S La Mode Fashions Pvt. Ltd.) entered into separate Agreements to Sell dated August 18, 2005, with the respondents to purchase two interconnected shops for a total consideration of Rs. 1.68 crores (Rs. 84 lakhs each). The appellants paid an advance of Rs. 9,00,000/- each (Total Rs. 18 lakhs), with the balance due by December 31, 2005. When the balance was not paid, the respondents cancelled the agreements and forfeited the advance money.
- The Dispute Over Extension of Time
The appellants claimed that the deadline for completion was mutually extended to February 28, 2006, citing a handwritten endorsement on the back of the agreements signed by Respondent No. 2 and Kamal Rohra (the son of Respondent No. 1). The respondents contended that this endorsement was unauthorized, that no such extension was granted, and that the signatures were obtained under the guise of acknowledging a receipt for photocopies.
- Authority to Modify Contracts
The Court delved into whether Kamal Rohra could validly sign an extension on behalf of his mother (Respondent No. 1). The Court held that:
- Lack of Authorization: There was no Power of Attorney or written authority produced to show he was authorized to act on her behalf regarding the sale of the property.
- Co-owner Consensus: For property with multiple owners, a consensus ad idem (meeting of minds) among all co-owners is essential for any modification of material terms.
- Legal Precedent: Citing Supreme Court rulings, the Court emphasized that an agent’s authority to bind a principal to a contract for sale must be clear and unambiguous.
- Time as the Essence of the Contract
While time is generally not considered the essence in contracts for immovable property, the Court noted that it can be inferred from the express terms and surrounding circumstances. In this case:
- The respondents had specifically incorporated clauses regarding strict timelines because they needed the funds to repay bank loans and release mortgages on other family properties.
- Consequently, the failure of the appellants to pay the balance within the stipulated time justified the cancellation of the agreements.
- Failure to Prove “Readiness and Willingness”
Under Section 16(c) of the Specific Relief Act, a plaintiff must show continuous readiness and willingness to perform their part of the contract. The Court found the appellants deficient because:
- Financial Incapacity: Cross-examinations revealed the appellants did not have the requisite funds (even half the required amount) in their bank accounts at the relevant time.
- Lack of Documentary Evidence: The appellants made “bald statements” about having cash or arranging loans from friends but produced no bank statements, account books, or pay orders to substantiate their capacity to pay.
- Continuous Requirement: Readiness refers to financial capacity, while willingness refers to conduct and intention; the appellants failed on both counts.
- Final Conclusion
The High Court affirmed the Trial Court’s findings that the purported extension was invalid and that the appellants were never genuinely ready to complete the transaction. Finding no merit in the appeals, the Court dismissed the petitions, thereby upholding the dismissal of the suits for specific performance and permanent injunction.
2026 DHC 5400
Gourave Gupta vs. Laxmi Rohra & Anr.(D.O.J. 06.07.2026)




