Courts Can’t Grant Refund of Earnest Money Without Plea: SC Clarifies Section 22 of Specific Relief Act.

Introduction

In a significant judgment, the Supreme Court of India has clarified that courts cannot grant alternative reliefs—such as the refund of earnest money—on their own (suo moto) under Section 22 of the Specific Relief Act, 1963, unless such relief is specifically claimed by the plaintiff. This ruling reinforces the importance of precise pleadings and serves as a guiding light for civil litigation involving property transactions and contractual disputes.

What Is Section 22 of the Specific Relief Act?

Section 22 of the Specific Relief Act provides that in a suit for specific performance of a contract, the plaintiff may ask for certain alternative or additional reliefs such as:

• Possession,
• Partition,
• Refund of earnest money or deposit.

However, there's a catch—these reliefs must be explicitly claimed in the plaint.

The Supreme Court’s Observation

In its recent ruling, the Supreme Court held that the court cannot unilaterally decide to award refund of earnest money if the plaintiff did not demand such relief in the initial pleadings. The judgment emphasized that relief under Section 22 must be specifically pleaded, otherwise the court does not have the jurisdiction to grant it.

This prevents unnecessary judicial overreach and ensures fair play for both parties. It also protects defendants from being caught off-guard by unexpected reliefs granted at the court's discretion.

Why This Judgment Matters

1. Preserves Procedural Discipline: Courts must operate within the boundaries of the pleadings. This ensures procedural fairness and gives both parties an equal chance to present their case.

2. Reduces Judicial Overreach: Granting reliefs not claimed by the parties can undermine the adversarial system of justice. This ruling puts a check on such possibilities.

3. Legal Clarity for Litigants: Plaintiffs and their lawyers now have a clear mandate—they must be meticulous in drafting and include all potential reliefs they seek.

Practical Takeaway for Plaintiffs

If you are filing a suit for specific performance of a contract, particularly in cases involving sale agreements or property deals:

• Always include a clear prayer for alternative reliefs, especially refund of earnest money or deposit.
• Failing to do so may lead to complete loss of remedy, even if the court sympathizes with your situation.

Conclusion

This judgment serves as a timely reminder that justice is not just about fairness—it’s also about following the correct legal process. Courts cannot play the role of a substitute claimant by awarding unclaimed reliefs. Whether you're a litigant, lawyer, or law student, understanding this principle is crucial in navigating civil litigation effectively.