Explicit Claim for Refund a Must: Supreme Court on Specific Relief Act

The Supreme Court has ruled that unless a plaintiff specifically requests a refund of advance or earnest money in the legal pleadings, courts cannot award such a relief on their own. This decision was made by a bench of Justices J.B.

Pardiwala and R. Mahadevan while interpreting Section 22 of the Specific Relief Act, 1963.

The Court underscored that:

“It is thus a settled position of law that the plaint may be amended at any stage of the proceedings to enable the plaintiff to seek an alternative relief, including that of refund of earnest money, and the courts have been vested with wide judicial discretion to permit such amendments. However, under Section 22 of the 1963 Act, the courts cannot grant such relief suo moto, since the inclusion of the prayer clause remains a sine qua non for the grant of such a relief.”

This observation came during the case of K.R. Suresh v. R. Poornima & Ors., where the plaintiff sought the return of the advance payment made as part of a property transaction. The seller had forfeited the earnest money, prompting the plaintiff to seek a refund. However, the plaintiff had not included a direct prayer for such a refund in the original legal complaint.

The Court rejected the contention that no specific request was needed, affirming that a clear demand in the pleadings is essential. The judges also acknowledged that while amendments to include such a request can be made at any point, in the absence of such an amendment, the court is not authorized to grant that relief.

An exception, the Court noted, applies when the refund is a consequential relief stemming from a decree of specific performance-as recognized in the precedent Manickam @ Thandapani v. Vasantha.

In effect, the Supreme Court’s decision reinforces the necessity of explicitly stating a claim for refund in a legal pleading under the Specific Relief Act to ensure such relief can be granted.