1. This appeal has been preferred by the defendant in the suit in O.S.No.9 of 1989 on the file of the Principal Sub Court, Tirunelveli. The suit in O.S.No.9 of 1989 was filed by the first respondent, as plaintiff, for specific performance of an agreement of sale dated 03.07.1985 in respect of the suit property. The suit property is a land measuring an extent of 6 cents along with two houses bearing Door Numbers 12/2 and 12/3 in Seevalaperi Road, Palayamkottai, Tirunelveli District.
2. The case of the plaintiff in the suit are as follows:
2.1.The suit property belonged to the defendant /
appellant. The plaintiff and defendant entered into a sale
agreement on 03.07.1985 to sell the suit property to the plaintiff.
The total sale consideration was fixed at Rs.1,13,000/- and a sum
of Rs.13,001/- was paid as advance. The defendant disclosed a
Government loan on the suit property and there was no other
encumbrance over the suit property. The defendant undertook
to execute the sale deed free of encumbrance on or before
02.01.1986 on receipt of the balance of sale consideration.
2.2.The plaintiff subsequently paid a sum of
Rs.40,000/- to the defendant as agreed upon on 15.09.1985 and
the said payment was endorsed on the back side of the sale
agreement itself. Thereafter, another sum of Rs.32,000/- was
paid to the defendant on 22.12.1985 and the said payment was
also endorsed in the sale agreement.
2.3.Though the plaintiff expressed his readiness and
willingness to pay the balance and demanded the defendant to
produce the original title deeds, the defendant was contending
that she had to get permission from Government to dispose of
the suit property and that the original deed which was
surrendered by her to TWAD Board for securing the loan was not
returned to her. Hence, it was only to enable the defendant to
get permission from Government and to get the document of title
deeds, the defendant was postponing the execution of the sale
deed. In the meanwhile, the plaintiff came to know about yet
another mortgage executed by the defendant in favour of one
Kalyani Ammal for a sum of Rs.17,000/- in the year 1983 which
was not disclosed to the plaintiff. Since the plaintiff is interested
in the property, he got the mortgage transferred in his favour by
a registered document dated 11.12.1987 for a sum of Rs.17,000/-
and that therefore, the defendant is also liable to pay the said
sum to the plaintiff. The defendant was unable to fulfil her
obligation and started demanding an additional sum of
Rs.15,000/- in addition to price agreed. Now, the defendant
demands more than Rs.50,000/- in addition to the sale
consideration which was originally agreed and refused to comply
with the terms of the contract. The defendant is also attempting
to dispose of the suit property to third party suppressing the sale
agreement in favour of the plaintiff. After taking over possession
of the suit property, the plaintiff has made several improvements
to the houses. Alterations have been made to the buildings and
new kitchen and bath room, have also been put up. New flooring
was also laid in the rear and front portion of the house. The
plaintiff has also fixed a ladder to upstairs and shelves, etc. All
these improvements by spending a sum of Rs.15,000/-. The
plaintiff waited for too long a period for no purpose and
ultimately the plaintiff has no option but to file the present suit.
3. The suit was contested by the defendant by filing a
written statement. The suit agreement dated 03.07.1985 and the
receipt of an advance under the agreement was admitted.
However, it was contended by the defendant that the plaintiff
agreed to pay the entire balance amount and get the sale deed
registered within six months from the date of agreement, but
did not comply with. The contention of the plaintiff that the suit
property was handed over to the plaintiff on the date of
agreement was specifically denied by the defendant. The
defendant admitted the mortgage in respect of one of the two
houses but it was the specific case of the defendant that this
mortgage was disclosed to the plaintiff. Further payment of
Rs.40,000/- and Rs.32,000/- was also not disputed by the
defendant. However, it was the specific case of the defendant
that the entire sale consideration should be paid before the
expiry of six months, as stipulated in the sale agreement and that
the plaintiff was not ready with the balance of sale consideration
to get the sale deed executed in his favour. The delay was not
because of any fault on the part of the defendant. It was stated
that instead of paying the balance of sale consideration to the
defendant, the plaintiff managed to get the mortgage rights
assigned in his favour. Since the defendant was in urgent need
of money, it was further contended that she was only pressing
the plaintiff to get the balance of sale consideration and to get
the sale deed executed. The plaintiff was not prepared to go
ahead with the execution of sale deed promptly in terms of the
sale agreement. It was the case of the defendant that the
defendant was not interested in completing the sale in time even
though time is essence of contract and that therefore, the suit
itself is barred by limitation. It was further contended by the
defendant that the plaintiff did not get possession under the sale
agreement and that therefore, he is not entitled to alter the
physical features and claim any improvements. It was further
stated that since the plaintiff has built separating walls and that
in that process, damaged the floor, the defendant also claimed
that the plaintiff is liable to pay a sum of Rs.7,000/- towards
damages and that the defendant is not liable to pay any amount
towards improvement.
4. The trial Court framed the following issues:
(1)Whether time is essence of the agreement?
(2)Whether possession was handed over to the plaintiff
pursuant to the suit agreement dated 03.07.1985?
(3)Whether the defendant has delayed the execution of the
agreement?
(4)Whether the plaintiff is liable to compensate the
defendant?
(5)Whether the plaintiff was ready and willing to perform his
part of the contract?
(6)Whether the suit is barred by limitation?
(7)Whether the plaintiff is entitled to the relief of specific
performance?
5. The plaintiff examined himself as P.W.1 and marked
Exs.A1 to A20. The defendant did not produce any evidence nor
examined any witness.
6. On the first issue, the trial Court on the interpretation of the sale agreement which was marked as Ex.A1, came to the conclusion that the sale agreement though referred to the date within which the sale transaction to be completed, there was no mentioning of the consequences of nonperformance within the date (02.01.1986) specified in the agreement. Since the parties have not agreed as to the next course in case of failure to perform the contract on or before 02.01.1986, the trial Court came to the conclusion that the date referred to in the sale agreement for completion of the contract is not final and the time is not the essence of the sale agreement under Ex.A1. Further, the trial Court also relied upon the document Ex.A14 which is a letter alleged to have been written by the defendant to the plaintiff. In the said letter, the following recitals are found:
"VERNACULR MATTER OMITTED"
7. The above said letter was written on 08.02.1986 by
the defendant to the plaintiff. Since this letter was written by
the defendant after 02.01.1986, namely, the date specified in the
sale agreement, the trial Court further observed that this letter
would not have been written by the defendant to plaintiff if really
the date 02.01.1986 was considered to be a final and specified
date for performance.
8. Though the trial Court found that the plaintiff was in possession of the suit property, the trial Court specifically rejected the case of the plaintiff that possession was handed over to the plaintiff by the defendant pursuant to the agreement dated 03.07.1985. As to the readiness and willingness, the trial Court found that the plaintiff has been ready and willing to perform the contract, as the plaintiff has paid substantial portion of the sale consideration to the defendant. Since the defendant has not proved that she had obtained permission from the Government and got the document redeemed, it was held that the plaintiff could not get the sale transaction completed. Hence, the nonperformance of contract by plaintiff was held because of the breach committed by the defendant. Since the defendant is responsible for the delay in performance and the plaintiff was always ready and willing to perform his part of the contract, the trial Court concluded that the plaintiff is entitled to the relief of specific performance. Regarding the fourth issue, the trial Court found that the plaintiff is not liable to compensate the defendant for any damages. On the question of limitation, the trial Court found that the date 02.01.1986 though specified in the agreement for the purpose, the trial Court came to the conclusion that the date 02.01.1986 is not the final and specified date agreed as a date within which the contract should be performed and that time is not the essence of the suit agreement. Since the letter marked as Ex.A14, dated 08.02.1986 shows that the defendant herself was willing to perform the contract, even after the expiry of time specified in the agreement, the period of limitation starts only from the date of Ex.A14 i.e., 08.02.1986 and that the suit is not barred by limitation. Aggrieved by the findings of the trial Court, the defendant has preferred the above appeal. Since the plaintiff / respondent died during the pendency of this appeal, the respondents 2 to 5 were brought on record as legal representatives of the deceased first respondent.
9. In the memorandum of grounds, the appellant''s main contention was on the question of limitation. The learned counsel for the appellant, focused his argument more importantly on the following lines:
(a) The suit is barred by limitation.
(b) Since the plaintiff pleaded a false case that he was put
in possession of the suit property pursuant to the sale
agreement, he is not entitled to the relief of specific
performance.
(c) The plaintiff was not ready and willing to perform his
part in terms of the sale agreement.
10. Though the learned counsel for the appellant made
several other submissions, this Court is not in a position to
consider all the submission of the learned counsel for the
appellant, having regard to the specific stand taken by the
defendant in the written statement and the memorandum of
grounds and the fact that the defendant has not filed any
document nor examined any witness. The following points are
framed for determination:
(i) Whether the suit is barred by limitation?
(ii) Whether the plaintiff was always ready and
willing to perform his part in terms of the suit
agreement?
(iii) Whether the plaintiff is entitled to the
equitable relief of specific performance?
11. The following facts are not in dispute: 11.1.The plaintiff and defendant entered into the sale agreement under Ex.A1, dated 03.07.1985 and a sum of Rs.13,001/- was paid as advance on the date of the agreement. The plaintiff and defendant agreed that the sale should be completed within six months i.e., on or before 02.01.1986 and the defendant should execute the sale deed in respect of the suit property without any encumbrance and the plaintiff should pay the balance of sale consideration within the time. It was further agreed that the plaintiff should pay a further sum of Rs.40,000/- within a period of two months from the date of agreement so as to enable the defendant to discharge the Government loan. It is not in dispute that the said sum of Rs.40,000/- was paid by the plaintiff to defendant on 15.09.1985 and the said payment was also endorsed in the sale agreement. A further sum of Rs.32,000/- was paid by the plaintiff to the defendant on 22.12.1985 within time. On 08.02.1986, the defendant appears to have written a letter to the plaintiff expressing her willingness to execute the sale deed and requesting the plaintiff to make arrangements to complete the sale for a sum of Rs.65,000/-. However, there was no correspondence or communication nor exchange of notice between the plaintiff and defendant till the suit was filed on 09.01.1989. The learned counsel for the appellant submitted that the suit is barred by limitation as the suit has been filed only on 09.01.1989 which is beyond the period of three years from the date fixed for performance that is 02.01.1986. The learned counsel for the appellant also referred to the plaint particularly the cause of action paragraph wherein there was no reference to the document Ex.A14. The learned Counsel for the appellant referred to Section 9 of the Limitation Act and the Order VII, Rule 1 of C.P.C. and submitted that the case of the plaintiff relying upon Ex.A14 is inconsistent with the plaint averments and that the trial Court ought to have held that the suit is barred by limitation. Alternatively, the learned counsel for the appellant submitted that the document Ex.A14 would only show that the defendant had agreed to execute the sale only upon receipt of a further sum of Rs.65,000/- and that this is not in tune with the suit agreement. It was the argument of the learned counsel for the appellant that the letter under Ex.A14 would only lead to an inference that there was narration and the plaintiff who filed the suit under the original cause of action cannot rely upon Ex.A14 for the purpose of limitation. Since specific time is prescribed in the sale agreement for the performance of the contract, the learned counsel for the appellant would urge that the first limb of Article 54 of the Limitation Act would be applicable to the case on hand and that the suit is therefore hopelessly barred by limitation.
12. The learned counsel for the appellant relied upon a judgment of this Court in the case of S.Maruthai and another v. Gokuldoss Dharam Doss and four others reported in 1999 (III) CTC 724 wherein it has been held as follows:
"23. Being in possession of the property, assuming he is in possession,
may enure to his benefit to contend in a suit for possession filed by the
owners that he is in possession in part performance of the contract;
that he has done some act in furtherance of the contract and that he is
ready and willing to perform the contract and thereby try to protect
his possession. This plea of being in possession will not be available to
him to save his suit for specific performance from the law of limitation.
Under Article 54 of the Limitation Act three years is prescribed as the
time limit and it starts to run from the date fixed for the performance
of the contract or if no such date is fixed when the plaintiff has notice
that performance is refused. In this case admittedly a date is fixed
namely three months from 18.7.1975 and therefore the time to file the
suit on that contract started running from the commencement of
18.10.1975. Under Section 9 of the Limitation Act when once time has
begun to run no subsequent disability or inability to institute a suit or
make an application would stop it. Assuming that the time of three
months fixed under the contract was not really the time in the mind of
the parties and in fact the time would start running as against the
buyer only when the vendors perform all their obligations under the
contract of sale, yet inasmuch as I have found that the vendors in this
case have performed all their, obligations under the contract of sale
within the period three months itself, judgment reported
in Lakshminarayana v. Singaravelu,, is of no help in this case. It is no
doubt true that in the suit for possession and in the written statement
of the third defendant in the suit for specific performance there is an
admission that the vendors have adopted the agreement though they
were not parties to it. Suit for possession was presented before court
on 17.7.1987 and the written statement of the third defendant in the
other suit was filed on 7.8.1989. Relying on these two admissions the
learned Senior Counsel would contend that if at all the buyer had any
knowledge about the others having adopted the agreement of sale it is
only from the respective dates referred to above and therefore the
buyer would be entitled to file a suit for specific performance at any
time thereafter. Since on facts I found that the buyer had been told
and had knowledge about the others also joining in the execution of
the sale deed these circumstances relied upon by the learned Senior
Counsel really do not come in favour of the buyer. These admissions
being subsequent events therefore the Court can allow amendments
by taking note of that is the submission of the learned Senior Counse
for the buyer and for this purpose he relied upon the following
judgments:
1.Amritlal N. Shah v. Alla Annapurnamma, AIR. 1959 AP 9;
2.Deenadayalu v. Lalithakumari, 1952 (1) MLJ 510;
3. Velammal v. Chokkiah Gounter, 1971 (2) MLJ 132.
In view of my finding on facts as rendered earlier that the Vendors
have performed their obligations under the contract of sale the
argument advanced by the learned Senior Counsel on the subsequent
events and the judgments relied upon by him in that regard are not
attracted to the case on hand. A learned single Judge of this court in
the judgment reported in J. Vasantha v. M. Senguttuvan, 1997 (2) L.W
820., had held that even if for a single day the plaintiff/agreement
holder is not ready to take the sale deed the equitable remedy should
not be granted and the readiness and willingness must be there
continuously from the date of the agreement upto the date of hearing.
For all the reasons stated above I hold that the buyer had not
established his readiness and willingness to perform his obligations
under the Contract of sale at any point of time and therefore he is not
entitled to the relief of specific performance. I also hold that as far as
the vendors are concerned they have established by clinching
evidence that they have performed all the obligations that are
expected of them under the contract of sale. I also hold that the suit in
this case is hopelessly barred by limitation."
13. As against the submissions of the learned counsel
for the appellant, the learned counsel for the respondents relied
upon few judgments of the Hon''ble Supreme Court and
submitted that the defendant / appellant who has agreed to
perform her part of the contract, after the date specified in the
agreement for the performance, the subsequent letter
postponing the performance to a future date without fixing any
further date for performance would bring the case under second
limb of Article 54 where the three years period of limitation will
commence only when the plaintiff had notice regarding refusal of
performance. Since several judgments were cited by the learned
counsel for both sides, this Court is bound to consider this issue
in the light of the pleadings and documents. First of all, it is to
be noted that the plaintiff has not referred to the document
Ex.A14, dated 08.02.1986 in the plaint. It is also relevant to
read paragraph 12 of the plaint where the cause of action for the
suit has been stated. Paragraph 12 reads as follows:
"12.The cause of action for the suit arose on 03.07.1985
when the sale agreement was concluded between the plaintiff and the
defendant and took possession of the property on 15.09.1985 and
22.12.1985 when the defendant received Rs.40,000/- and Rs.32,000/-
respectively in furtherance of the contract to promote completion of
the sale, since March 1986 when the defendant has been contending
that she was not given permission to sell the property and that the
title deed was not returned to her since March, 1987 when she has
been demanding additional amounts, over and above the agreed sale
consideration, and also attempting to dispose off the schedule
properties to third parties suppressing the sale agreement in favour of
the plaintiff, at Palayamkottai where the schedule property is situate
within the jurisdiction of this Honourable Court."
14. From the cause of action paragraph of the plaint, it can be seen that it is the definite case of the plaintiff that in March, 1986, the defendant was contending that she was not able to get permission to sell the property and that the title deed was not returned to her. However, there is no material produced to show that the defendant could not execute the sale deed without permission of Government. If there is a statutory bar and then the suit itself is not maintainable. Hence, the statement is only self-serving to save limitation. It is also the case of the plaintiff that from March, 1987, the defendant was demanding additional amount over and above the amount which was agreed under the sale agreement. Letter under Ex.A14 dated 08.02.1986 was not even referred to in the sale agreement. Under Order VII, Rule 1 CPC, the plaint should also contain the facts constituting the cause of action and when it arose. Order VII, Rule 1 (e) would show that the facts constituting the cause of action and the facts to prove that the suit is filed in time should be stated. Whenever a suit is instituted beyond the period of three years, in a suit for specific performance, the plaint should contain the facts as to show how the suit fall within the period of limitation. However, the plaint in this case does not disclose the document Ex.A14 which has been taken as the starting point for limitation by the trial Court. It was stated in the plaint that in March 1986, the defendant was taking time as she could not get permission to sell the property nor return of title deed. Going by the agreement Ex.A1, the agreement contemplates specific time within which the sale to be completed. The sale agreement refers to the following recitals "ehsJ BjjpKjy; 6 khj tha;jht[f;Fs; mjhtJ 02.01.1986 Bjjpf;Fs;". Hence, in this case, a specific time is prescribed for performance in the suit agreement Ex.A1. Therefore, the limitation start running from 02.01.1986. Admittedly, the suit has been filed only on 09.01.1989 which is beyond the period of three years from the date specified for performance namely 02.01.1986. The trial Court has relied upon Ex.A14 dated 08.02.1986 which was not even referred to in the plaint. The plaintiff has not pleaded this letter Ex.A14 to save the period of limitation. P.W.1 has deposed before the Court about Ex.A14 in the following lines:
"VERNACULR MATTER OMITTED"
15. From the pleadings and evidence, it is evident that
the document Ex.A14 was never considered even by the plaintiff
as a piece of evidence to save limitation. Though the
genuineness of the document Ex.A14 was disputed by the
defendant during the trial, in the absence of independent
evidence and examination of defendant, denying the signature in
Ex.A14, this Court cannot accept the case of the appellant that
the document Ex.A14 was never written by the defendant.
However, this document Ex.A14 was neither referred to in the
plaint nor its contents in the cause of action paragraph
indicating any extension of time. However, from the cause of
action paragraph, the plaintiff would only urge that the
defendant was from March, 1986 contending that she could not
get permission from Government to execute sale and that from
March 1987 she was demanding more amount for executing the
sale deed. Hence, the document Ex.A14 has not been
understood by the plaintiff giving extension of time to save the
suit from limitation.
16. The learned counsel for the respondents would submit that by virtue of the document Ex.A14, the three years period would start running only from the date of Ex.A14 ie., 08.02.1986.
17. To appreciate the legal submission of the appellant, it is necessary to refer to Section 9 of the Limitation Act which runs as follows:
"9. Continuous running of time.-Where once time has begun to run,
no subsequent disability or inability to institute a suit or make an
application stops it: Provided that where letters of administration to
the estate of a creditor have been granted to his debtor, the running of
the period of limitation for a suit to recover the debt shall be
suspended while the administration continues."
18. Article 54 of the Limitation Act is relevant and it is
extracted as follows:
"For specific performance of a contract -- three years -- The date fixed
for the performance, or if no such dated is fixed, when the plaintiff has
notice that performance is refused."
19. The learned counsel for the respondent relied upon the judgment of the Hon''ble Supreme Court in the case of S.Brahmanand and others v. K.R.Muthugopal (D) and others reported in AIR 2006 SC 40 wherein it has been held in paragraph 36 as follows: "36.Thus, this was a situation where the original agreement of 10.3.1989 had a "fixed date" for performance, but by the subsequent letter of 18.6.1992 the Defendants made a request for postponing the performance to a future date without fixing any further date for performance. This was accepted by the Plaintiffs by their act of forbearance and not insisting on performance forthwith. There is nothing strange in time for performance being extended, even though originally the agreement had a fixed date. Section 63 of the Indian Contract Act, 1872 provides that every promisee may extend time for the performance of the contract. Such an agreement to extend time need not necessarily be reduced to writing, but may be proved by oral evidence or in some cases, even by evidence of conduct including forbearance on the part of the other party. Thus, in this case there was a variation in the date of performance by express representation by the Defendants, agreed to by the act of forbearance on the part of the Plaintiffs. What was originally covered by the first part of Article 54, now fell within the purview of the second part of the Article. Pazhaniappa Chettiyar v. South Indian Planting and Industrial Co. Ltd. and Anr. was a similar instance where the contract when initially made had a date fixed for the performance of the contract but the Court was of the view that "in the events that happened in this case, the agreement in question though started with fixation of a period for the completion of the transaction became one without such period on account of the peculiar facts and circumstances already explained and the contract, therefore, became one in which no time fixed for its performance." and held that was originally covered by the first part of Article 113 of the Limitation Act, 1908 would fall under the second part of the said Article because of the supervening circumstances of the case."
20. The facts in the case before the Hon''ble Supreme Court can be summarised as follows:
20.1.On 10.03.1983 an agreement was entered into
between the plaintiffs 1 to 3 and defendants 1 and 2 for the sale
of the suit property. At the time of entering into the sale
agreement, a stranger had filed two suits on the basis of an
earlier agreement of sale in respect of the suit property by the
defendant in his favour and one of the suits was for specific
performance of earlier agreement. Since the parties are aware
of the pending suit, they specifically recorded that the
defendants had not made any such agreement though it was the
subject matter of the two suits filed by stranger. In the pending
suit, the plaintiff has also obtained an order of injunction
restraining the defendants from transferring the land to third
parties. Hence, the defendants agreed to sell after the interim
order in the suits imposing restriction on alienation is vacated by
the Court and that the purchasers shall tender the balance
immediately on the termination of the proceedings in Court.
20.2.Though on 10.06.1992 the suits filed by the
stranger were dismissed and the interim order stood vacated,
the plaintiff in the previous suit filed an application for
injunction till he could file an appeal as against the judgment of
the trial Court rejecting his prayer and obtained an order of
status quo. However, on 11.06.1992, the plaintiffs were put in
possession of the property by the power of attorney agent of the
defendants. Thereafter, on 18.06.1992, the first defendant in the
suit addressed a letter to the plaintiff with the following recitals:
"Dear Brahmanand, Trust this will find you all quite well. I am in
receipt of your letter-dated 12.6.92. It is indeed gratifying to know
that the two suits filed by Bhatt have been dismissed. Dandayudhan
gave me information 10th itself and I immediately intimated him to
hand over keys of the godown to you as a token of our intention to
fulfill our commitments under the agreement. Personally, I am not for
delaying matters any more. However, it appears that Bhatt has filed an
injunction petition to get injunction till appeal is filed.
My friends here are saying that we might as well await the result of
the petition before going ahead with registration. Otherwise it may
create further problems. Knowing Bhatt, I am sure you will agree that
it is advisable to wait for things to be more clear, now that you are in
possession of the godown.
It is a pity that Bhatt can got hold of people like Moosakutty to harass
us. I look forward to coming to Calicut shortly along with Rajan, to
conclude the registration as soon as I get information from
Dandayudhan in the matter."
20.3.Relying upon the said letter, the learned counsel
for the plaintiffs before the Hon''ble Supreme Court contended
that no date for specific performance was fixed until the cloud on
the vendors was removed and that by the letter dated
18.06.1992, the date of performance was extended until the
difficulty created by the third parties was resolved. In other
words, it was contended by the plaintiffs therein that by virtue of
the letter dated 18.06.1992 the first part of Article 54 of the Part
1 of the Limitation Act 1963 would not apply. Though before the
Hon''ble Supreme Court it was also contended by the plaintiffs
that no definite date was fixed for performance in the suit
agreement therein, after referring to several judgments, the
Hon''ble Supreme Court ultimately did not decide the issue
whether in the suit agreement therein a specific date was fixed
for performance. However, relying upon the letter dated
18.06.1992 the Hon''ble Supreme Court has held that time which
was originally fixed for performance was extended by the
defendant. It was only on the basis of the subsequent letter
dated 18.06.1992, the Hon''ble Supreme Court held that the
agreement in question though started with fixation of period for
completion of the transaction became one without such period
on account of the peculiar facts and circumstances. Hence, it
was held by the Hon''ble Supreme Court that the second part of
Article 54 would apply in the said case.
21. The learned counsel for the respondents would rely
upon the judgment of the Hon''ble Supreme Court in the case of
Panchanan Dhara and others v. Monmatha Nath Maity
(Dead) through LRs and another reported in 2007-1-L.W.
(Crl.) 652 wherein it has been held as follows:
"21.A bare perusal of Article 54 of the Limitation Act would show that
the period of limitation begins to run from the date on which the
contract was to be specifically performed. In terms of Article 54 of
the Limitation Act, the period prescribed therein shall begin from the
date fixed for the performance of the contract. The contract is to be
performed by both the parties to the agreement. In this case, the First
Respondent was to offer the balance amount to the Company, which
would be subject to its showing that it had a perfect title over the
property. We have noticed hereinbefore that the courts below arrived
at a finding of fact that the period of performance of the agreement
has been extended. Extension of contract is not necessarily to be
inferred from written document. It could be implied also. The conduct
of the parties in this behalf is relevant. Once a finding of fact has been
arrived at, that the time for performance of the said contract had been
extended by the parties, the time to file a suit shall be deemed to start
running only when the plaintiff had notice that performance had been
refused. Performance of the said contract was refused by the Company
only on 21.8.1985. The suit was filed soon thereafter. The submission
of Mr. Mishra that the time fixed for completion of the transaction was
determinable with reference to the event of perfection of title of the
Second Respondent cannot be accepted. The said plea had never been
raised before the courts below. Had such a plea been raised, an
appropriate issue could have been framed. The parties could have
adduced evidence thereupon. Such a plea for the first time before this
Court cannot be allowed to be raised. Even otherwise on a bare
perusal of the agreement for sale dated 18.4.1971, it does not appear
that it was intended by the parties that the limitation would begin to
run from the date of perfection of title.
26.Performance of a contract may be dependent upon several factors
including grant of permission by the statutory authority in appropriate
cases. If a certain statutory formality is required to be complied with
or permission is required to be obtained, a deed of sale cannot be
registered till the said requirements are complied with. In a given
situation, the vendor may not be permitted to take advantage of his
own wrong in not taking steps for complying the statutory provisions
and then to raise a plea of limitation."
22. In the case before the Hon''ble Supreme Court, the
findings of the Courts below was that time for performance of
the contract had been extended by parties. It was only based on
the finding of fact arrived by the Courts below, the Hon''ble
Supreme Court observed that the time to file a suit shall be
deemed to start running only when the plaintiff had notice of
refusal of performance. It is further interesting to note from the
said judgment that the purchaser was required to offer the
balance amount to the seller subject to the seller showing that
he had a perfect title over property in question. Having regard
to the nature of agreement and the fact that the Courts below
arrived at a definite finding that the period of performance of the
agreement had been extended subsequently, the judgment of the
Hon''ble Supreme Court referred to above cannot be applicable
to the facts of the present case where there was no extension of
time. It is not even the case of the plaintiff herein that time was
extended by the defendant for performance. The document
Ex.A14 would only suggest that the plaintiff was willing to
execute the sale deed even after the expiry of time that was
specified in the agreement for performance.
23. In the present case, the agreement disclose the amount payable to the Government. This amount was agreed to be paid out of further advance of Rs.40,000/-. Accordingly, paid also. Hence, it is not the case of plaintiff that defendant could not execute the sale deed as agreed. When the agreement was to be performed within a specified date, the limitation starts running from that date. The letter under Ex A14 does not give fresh cause of action as this letter was not intended to extend the time but to remind the plaintiff that the defendant is ready to execute the sale deed. However, the plaintiff did not come forward to execute the sale deed under the pretext that the defendant was demanding more money than agreed. Admittedly, there is no exchange of notice before filing suit in relation to the suit agreement. In such circumstances, the trial Court has not considered the question of limitation on the admitted facts. The finding of the trial Court that the agreement did not contain a clause as to what should happen if it is not performed within the time and that therefore, time is not the essence of the contract is not tenable. Similarly, the trial Court has rendered a finding that the date fixed in the sale agreement is not a specified date is also erroneous. Merely because the defendant has agreed to perform the contract even after the specified date that cannot be reason to hold that there is no specified date fixed in the suit agreement. The trial Court only on the basis of the letter dated 02.01.1986 has held that the suit filed within 3 years from this date is not barred by limitation. In my view, the letter dated 02.01.1986 cannot extend time. If it is construed to extend time it will enable any one to get over the period of limitation by referring to some evidence. If the letter dated 02.01.1986 were to be considered as one to extend period of limitation, the suit is not barred even if it filed in 1995 or later as the defendant never refused to perform in this case. Hence, I am of the view that the suit is barred by limitation as the same is not filed within 3 years from the date specified in the suit agreement and in the absence of any pleading in the plaint relying upon Ex.A.14 to save limitation, the trial Court''s finding on the question of limitation is not supported by pleading.
24. The learned counsel for the respondent further relied upon a judgment of the Hon''ble Supreme Court in the case of Balasaheb Dayandeo Naik (Dead) through LRs and others v. Appasaheb Dattatraya Pawar reported in 2008 (1) CTC 530 wherein the Hon''ble Supreme Court has held that in the case of sale of immovable property, there is no presumption as to time being the essence of contract. Paragraph 10 is relevant and it is extracted as follows: "10) It is clear that in the case of sale of immoveable property, there is no presumption as to time being the essence of the contract. Even where the parties have expressly provided that time is the essence of the contract, such a stipulation will have to be read along with other provisions of the contract. For instance, if the contract was to include clauses providing for extension of time in certain contingencies or for payment of fine or penalty for every day or week, the work undertaken remains unfinished on the expiry of the time provided in the contract, such clauses would be construed as rendering ineffective the express provision relating to the time being of the essence of contract. In the case on hand, though the parties agreed that the sale deed is to be executed within six months, in the last paragraph they made it clear that in the event of failure to execute the sale deed, the earnest money will be forfeited. In such circumstances, the above-mentioned clauses in the last three paragraphs of the agreement of sale would render ineffective the specific provision relating to the time being the essence of contract."
25. Relying upon the said judgment, the learned counsel for the respondents would submit that when time is not the essence of contract, in the present case, the second part of Article 54 alone should be made applicable. The contention of the learned counsel for the respondents has no legal basis. First of all, the question whether time is the essence of contract is not relevant for deciding as to which part of Article 54 should be made applicable in a given case. For the purpose of limitation, the time which is specified in the agreement for performance should be the starting point for limitation irrespective of the fact that whether time is the essence of the contract or not. Hence, the argument of the learned counsel for the respondents does not appeal to this Court as it is contrary to the well settled legal principles and language employed under Article 54 of the Limitation Act.
26. The learned counsel for the appellant relied upon a judgment of this Court, in the case of K.Raju v. V.P.Ramalingam reported in 2014 (5) CTC, 729 for the proposition that plaintiff who has approached the Court with a false case regarding possession is not entitled to equitable relief.
27. The learned counsel for the respondents then relied upon the judgment of the Hon''ble Supreme Court in the case of Gian Chand & Brothers and another v. Rattan Lal @ Rattan Singh reported in 2013 (1) CTC 399 wherein the Hon''bel Supreme Court in paragraph 27 has held as follows:
"27. Another aspect which impressed the High Court was the variance
in the pleadings in the plaint and the evidence adduced by the
plaintiffs. To appreciate the said conclusion, we have keenly perused
paragraphs 6 and 7 of the plaint and the evidence brought on record.
It is noticeable that there is some variance but, as we perceive, we
find that the variance is absolutely very little. In fact, there is one
variation, i.e., at one time, it is mentioned as Rs.6,64,670 whereas in
the pleading, it has been stated as Rs.6,24,670 and there is some
difference with regard to the date. In our considered view, such a
variance does not remotely cause prejudice to the defendant. That
apart, it does not take him by any kind of surprise. In Celina Coelho
Pereira (Ms) and others v. Ulhas Mahabaleshwar Kholkar and
others[7], the High Court had non-suited the landlord on the ground
that he had not pleaded that the business of the firm was conducted by
its partners, but by two other persons and that the tenant had parted
with the premises by sub-letting them to the said two persons under
the garb of deed of partnership by constituting a bogus firm. This
Court observed that there is substantial pleading to that effect. The
true test, the two-Judge Bench observed, was whether the other side
has been taken by surprise or prejudice has been caused to him. In all
circumstances, it cannot be said that because of variance between
pleading and proof, the rule of secundum allegata et probate would be
strictly applicable. In the present case, we are inclined to hold that it
cannot be said that the evidence is not in line with the pleading and in
total variance with it or there is virtual contradiction. Thus, the finding
returned by the High Court on this score is unacceptable."
28. Placing reliance upon the above judgment, the
learned counsel for the respondents would submit that in this
case, the case of the plaintiff that he got possession pursuant to
the agreement of sale cannot be considered as one that would
cause serious prejudice to the defendant and that the plaintiff
cannot be non-suited on the ground that the plaintiff has come
forward with a false case. The plea in the plaint that the plaintiff
has taken possession under the suit agreement Ex.A14 is a false
case as found by the trial Court. Claiming possession over the
suit property on the basis of the sale agreement is certainly a
serious matter. In the present case, it appears that the plaintiff
was in possession of one building as a tenant. Subsequent to the
agreement of sale, the plaintiff also took possession of the other
building by getting assignment from the mortgagee who was in
possession of the building in lieu of interest payable to him by
the defendants under the deed of mortgage. The stand taken by
the plaintiff is with a definite objective. However, I am not
inclined to reverse the judgment of the trial Court solely on the
basis of the conduct of the plaintiff in coming to the Court with a
false case. In this case, the false case does not have any effect
on the issues that arise for consideration in the suit for specific
performance. Hence, except taking note of the conduct, this
does not influence this Court to decide the points framed for
determination.
29. On the question of readiness and willingness, the plaintiff has pleaded his readiness and willingness in terms of Section 16(c) of the Specific Relief Act. It is also established by the plaintiff that the plaintiff had the means to pay the balance of sale consideration to complete the sale transaction. Hence, readiness has been proved by the plaintiff beyond doubt. The facts remains that the plaintiff was in possession of the suit property. The plaintiff himself admitted in the plaint that the defendant was claiming more amount than the amount agreed under Ex.A1 to complete the sale transaction from March 1987. The dates specified in the agreement expired on 02.01.1986. Though there was a letter under Ex.A14 dated 08.02.1986, there was no communication or exchange of notice between the parties till the suit was filed on 09.01.1989. The reason for not approaching the Court within the reasonable time was not explained. This unexplained delay in approaching the Court would also show that the plaintiff was not willing to perform his part of the contract in terms of the agreement. Though the plaintiff has proved that he was ready, from the conduct of the plaintiff, his willingness to perform the contract in terms of the agreement Ex.A1 is not proved. The difference between the readiness and willingness has been explained in various judgments. In this case, the plaintiff has not proved his willingness to perform his part of the contract. There was no notice calling upon the defendant to execute the sale deed any time before filing suit. This aspect of the case was not considered by the trial Court.
30. Having regard to the findings on facts and the discussions made above, this Court has no other option but to set aside the judgment of the trial Court and specifically hold that the suit is barred by limitation and that the plaintiff is not entitled to the equitable relief of specific performance in view of the conclusion that the plaintiff has not proved his willingness to perform his part of the contract in terms of the suit agreement under Ex.A1.
31. Hence, this appeal is allowed and the suit in O.S.No.9 of 1989 on the file of the Subordinate Court, Tirunelveli, is dismissed. However, there is no order as to costs.
