Arbitration Win for Seller – Market Escalation & Buyer’s Inaction Proved Decisive

MoU of Mamania to purchase land from Shetty at Chembur for Rs.11.25 crores.  It was agreed that in the event of non-completion of the agreement due to Shetty’s default, Mamania would have the option of demanding specific performance or demanding refund of earnest money with 12% per annum.  The amount of Rs.50 lakhs paid at the time of signing agreement has been treated as the earnest money.

However, before and after execution of the agreement, total payments of Rs.3 crores were made.

 In the suit of specific performance of the agreement filed by Mamania, the matter was referred to arbitration.

The Sole Arbitrator passed the award on 31.5.2013 holding that there has to be something more concrete to demonstrate actual readiness and willingness to put that money to use and complete the transaction as obligated under the contract.   The grant of specific performance would lead to a windfall gain for Mamania and a serious detriment to Shetty on account of the steep escalation in market price of the property and that keeping money in the bank is not a sing of being ready and willing to perform a contract.

Judgment dated 7.10.2025 of the High Court of Bombay in Arbitration Petition No.200 of 2014 of Vasanji Assaria Mamania  Vs.   Yadunarayan Mulky Shetty