Jogyeswar Mondal & Ors vs Haren Ch. Manna

Bibek Chaudhuri, J

Judgment and decree passed in a suit for specific performance of contract which was registered as Other Suit No.108 of 1989 in the 1st Court of the learned Munsif, Contai was set aside in appeal being Other Appeal No. 15 of 2000 by the learned Civil Judge (Senior Division), 2nd Court at Contai.

The said judgment and decree passed in Other Appeal No.15 of 2000 is assailed at the instance of the plaintiffs/appellants.

Factual matrix involved in the instant appeal is summarized below:-

One Bankim Chandra Mondal transferred the suit property by executing a deed of sale at a consideration price of Rs.500/-. On the very date of execution and registration of deed of sale, another deed, being a deed of reconveyance was executed by the vendee /defendant/respondent stipulating, inter alia, that the respondent would reconvey the suit property to its vendor i..e, the predecessor of the plaintiffs/appellants on receiving the consideration amount of Rs.500/- within 'Chaitra', 1395 B.S. Both the deeds aforesaid were executed by and between the parties on 29th December, 1986 and registered on 30th December, 1986. It is the case of the plaintiffs/appellants that during his life time their predecessor, namely, Bankim Chandra Mondal time and again approached the respondent to receive the said consideration money of Rs.500/- and execute the deed of reconveyance but the respondent neglected to execute such deed of reconveyance in favour of the predecessor-in-interest of the appellants. The original vendor died some time in 1987 leaving behind the present appellants as his legal heirs and representatives. The appellants, specially the appellant No.1 also approached the defendant/ respondent to execute deed of reconveyance in respect of the suit property in favour of them on receipt of the said sum of Rs.500/-. Even in the month of 'Chaitra', 1395 B.S. the appellant No.1 requested the respondent to execute the said deed of reconveyance but the respondent did not. The time limit to execute the deed of reconveyance expired, on the expiry of the last date of 'Chaitra', 1395 B.S. corresponding to 15th April, 1989. Immediately on 18th April, 1989 the appellants as plaintiffs filed a suit for specific performance of contract.

The defendant/respondent contested the suit by filing written statement wherein he denied the specific case of the plaintiffs to the effect that the defendant was approached within the stipulated period of time first by the predecessor then by the plaintiffs/appellants to execute the deed of reconveyance on receipt of consideration money. It is specifically pleaded by the defendant/respondent that the appellants were obliged to get the deed of reconveyance executed within 'Chaitra', 1395 B.S. which they failed and accordingly the defendant respondent has got indefeasible title in respect of the suit property and the appellants could not claim specific performance of the said deed of reconveyance.

During trial of the suit the appellant No.1 and the respondent had deposed as P.W.1 and D.W.2 respectively. The registered deed of reconveyance executed by the predecessor of the appellants and some other documents were brought in evidence by marking them as exhibits on behalf of the appellants.

The learned trial Judge on due consideration of the evidence on record and the argument advanced by the learned counsels on behalf of parties decreed the suit on contest.

The respondent preferred an appeal before the learned Civil Judge (Senior Division), 2nd Court at Contai against the said judgment and decree passed by the learned trial Court. The learned First Appellate Court allowed the appeal setting aside the judgment and decree passed by the learned trial Court on the ground that the suit was filed after the expiry of statutory period of limitation and the plaintiffs/appellants could not get any decree for specific performance of contract. In view of such finding, the judgment and decree passed in Other Suit No.108 of 1989 was set aside.

Being aggrieved by and dissatisfied with the judgment and decree passed by the learned First Appellate Court, the appellants have preferred the instant appeal.

It is found from the record of the instant appeal that this was admitted for hearing on 16th December, 2005. At the time of admission of appeal, the Division Bench of this Court formulated the following substantial questions of law.

"a) Whether the learned court of appeal below committed substantial error of law in holding that the suit was barred by limitation although, according to the agreement for sale, last date of performing agreement was on 15th April, 1989 whereas the suit filed on 18th April, 1989 was well within three years from 15th April, 1989?

b) Whether the learned court of appeal below committed substantial error of law in holding that the suit was barred by limitation by totally overlooking the fact that on the basis of materials on record the suit was well within the period of limitation, in view of Article 54 of the Limitation Act?"

Mr. Jagabandu Mondal, learned Advocate for the appellants at the outset submits that the instant appeal was admitted on a very short substantial question of law as to whether the suit for specific performance of contract was barred by limitation or not. On this score, learned Counsel for the appellants refers to Article 54 of the schedule of Limitation Act, 1963. Article 54 is quoted below: -

Description of suits

Period of limitation

Time from which period begins to run

PART II-Suits relating to accounts

For specific performance of a contract.

Three years

The date fixed for the performance, or, if no such date is fixed, when the plaintiff has noticed that performance is refused.

It is submitted by the learned Counsel for the appellants that in respect of a suit for specific performance of contract the period of limitation is three years and the said period begins to run on expiry of the time fixed in the agreement for performance. In the deed of reconveyance (Exhibit - 1) it was specifically stipulated that the parties were obliged to execute the deed of reconveyance on payment of consideration money within Chaitra 1395 B. S. corresponding to 15th April, 1989. Therefore, the last date fixed for performance on the basis of the said deed of reconveyance ended on 31st Chaitra, 1395 B. S. corresponding to 15th April, 1989. It is the specific case of the appellants that the appellant no. 1 lastly approached the respondent to execute the deed of reconveyance in the month of Chaitra, 1395 B.S. before filing of the suit, but he refused. The said period of time to get the deed of reconveyance executed ended on 31st Chaitra, 1395 B.S. corresponding to 15th April, 1989. The period of limitation, according to Article 54 of the schedule of the Limitation Act is three years which shall begin to run on the expiry of the last date fixed for the performance. The appellants instituted the suit on 18th April, 1989, i.e., within three days from the date within which the said deed of reconveyance was got to be executed by and between the parties. Therefore, the suit cannot be said to be barred by limitation and the Judgement delivered by the learned First Appellate Court suffers from patent illegality for non-consideration of the provision of Article 54 of the Limitation Act. It is further submitted by the learned Counsel for the appellants that readiness and willingness of the appellants to get the deed of reconveyance executed is evident from the fact that within three days of expiry of the period stipulated in the deed of reconveyance, the appellants as plaintiff filed the suit with specific pleading that the original vendor in the year 1987 till he breathed his last repeatedly requested the respondent to accept the said paltry sum of Rs.500/- and execute the deed of reconveyance in favour of him in respect of the suit property. After his death the appellants repeatedly approached the respondent to execute the deed of receipt of the said sum but the respondent refused to execute the said deed within the stipulated period of time as per the deed of reconveyance. Cause of action for the suit arose on the expiry of the stipulated period mentioned in the deed of reconveyance within which the respondent failed to execute the deed in favour of the appellants. Learned Advocate for the appellants draws my attention to the oral evidence adduced by the plaintiff/appellant no. 1 as P.W. 1 and the defendant/respondent as D.W. 1. He refers to the cross-examination of the said witnesses. From the cross-examination of P.W. 1 it transpires that the plaintiffs/appellants were all along ready and willing to get the deed of reconveyance executed by the respondents on payment of the said sum of Rs.500/-. From the evidence of D.W. 1 it is further found that at the relevant point of time the appellant no. 1 was a school teacher. He used to earn Rs.3,000/-/Rs.4,000/- per month. Therefore, there was no hardship on the part of the appellant no. 1 to make payment of the said sum to get the deed of reconveyance. He also refers to the Lower Court Records wherefrom it is found that with the filing of the suit, the plaintiffs/appellants have deposited the said sum of Rs. 500/- with Court's challan.

Thus, it is submitted by the learned Advocate for the appellants that the appellants were all along ready and willing and they had the capacity to pay the consideration money to get the said deed of reconveyance executed in their favour, but for the respondent they were compelled to file the suit. The learned Judge in First Appellate Court wrongly held that the suit was barred by limitation overlooking the provision of schedule 54 of the Limitation Act. Therefore, he submits that the Judgement and Decree passed by the learned First Appellate Court is liable to be set aside.

Mr. Ramdulal Manna, learned Advocate for the respondent at the outset draws my attention to the deed of reconveyance which was marked Exhibit - 1 in the Trial Court. He specifically refers to the recital of the said deed of reconveyance where the vendee/respondent had undertaken to execute a registered deed in favour of the vendor/predecessor-in-interest of the appellants on his payment of entire consideration price at a time within Chaitra, 1395 B.S.. It is also stipulated that if the seller failed to get the said deed of reconveyance executed within the aforesaid period of time, the deed of sale would be enforceable in favour of the respondent. According to the learned Counsel for the respondent, the said deed of reconveyance clearly stipulated that the predecessor of the appellants would forfeit his right for reconveyance of the suit property if he failed to make repayment of entire consideration money at a time within Chaitra, 1395 B.S.. It is urged by the learned Counsel for the respondent that where time is the essence of contract, schedule 54 of the Limitation Act is not applicable and in case of transfer of immovable property time is always essence of contract. In support of his contention, he relies upon a Judgement of the Hon'ble Supreme Court in the case of Bismillah Begum (Dead) represented by Legal Representatives - Vs.- Rahamattullah Khan (Dead) represented by Legal Representatives, reported in 1998 WBLR (SC) 103. In the aforesaid report, the Hon'ble Supreme Court clearly held that in contracts relating to reconveyance of property, time is always essence of the contract. The factual aspect of the said reported decision is almost similar to the case in hand. In the said reported decision, the predecessor of the appellants executed a registered sale deed in favour of the defendant in respect of the suit property and also simultaneously obtained an agreement of reconveyance from the defendant on the same date. The agreement for reconveyance stipulated that in case the seller was able to pay back the consideration within a stipulated period of time and certain expenses and other money spent by the purchaser towards repairing of the suit property, the seller would be entitled to get back the property. The suit was filed by the legal heirs of the vendor on the basis of the said agreement of reconveyance. The said suit was dismissed by the learned Trial Court and the Judgement and Decree of dismissal of the said suit was affirmed up to the High Court. Finally, the seller preferred an appeal before the Hon'ble Supreme Court. The Hon'ble Supreme Court was pleased to dismiss the appeal considering the fact that in respect of reconveyance of immovable property, time is always essence of contract and an option for the purchase or repurchase of property, must in all cases be strictly within the time limited for the purpose, otherwise it will lapse.

According to the learned Counsel for the respondent, the appellants tried to make out a case that during the lifetime, the vendor tendered the consideration money in favour of the vendee sometimes in the year, 1987. However, they could not produce any evidence that the vendor being the predecessor of the appellants actually tendered consideration money to the respondent in 1987. The appellants further pleaded that appellant no. 1 also tendered consideration money to the respondent in 1989 before expiry of the month of Chaitra. In his evidence appellant no. 1 (P. W. 1) stated that one Naren Mondal was the witness to prove that he tendered money to the respondent. But the said Naren Mondal was not examined by the plaintiffs/appellants during trial of the suit. Therefore, the case of the plaintiffs to the effect that they tendered the consideration money to the respondent within stipulated period of time to obtain the deed of reconveyance executed, remained uncorroborated during trial of the suit. The learned Appellate Court arrived at correct decision in the appeal relying on the ratio laid down by the Hon'ble Supreme Court in the case of Bismillah Begum (Supra).

To conclude, it is submitted by the learned Advocate for the respondent that when the deed of reconveyance specifically mentioned the time-limit within which the seller was obliged to perform his part, he is required to perform within the said period and it cannot be extended taking the aid of schedule 54 of the Limitation Act. Accordingly, it is submitted by the learned Counsel for the respondent that there is no reason to interfere with impugned Judgement and Decree passed by the learned First Appellate Court.

The deed of reconveyance dated 30th September, 1986 executed by the respondent Haren Ch. Manna in favour of Bankim Chandra Mondal, since deceased, predecessor of the present appellants was marked as Exhibit - 1 during trial of the suit. The recital of the said deed of reconveyance contains a declaration at the beginning that said Bankim Chandra Mondal transferred the suit property at a consideration price of Rs.500/- by executing a registered deed of sale. It is also stated in the said deed that the vendor delivered possession of the suit property in favour of the purchaser on execution of the deed of sale. By executing Exhibit - 1, the purchaser undertook to execute a deed of reconveyance on payment of entire consideration money at a time within 1395 B.S. It is clearly stipulated in the said deed of reconveyance that if the seller does not take the property back within the stipulated period of time, the deed of sale executed by him in favour of Haren Ch. Manna would remain in force (Jadi apni meyad moddhe na layen tabe apner diyat kobala amar balbat thakibek).

In the case of Shri Bhaskar Waman Joshi (deceased) -Vs.- Shri Narayan Rambilas Agarwal (deceased) reported in A.I.R. 1960 S.C. 301 the Hon'ble Supreme Court had the occasion to decide whether a document is a mortgage by conditional sale or an out an out sale. In this regard the Hon'ble Supreme Court was pleased to hold that the question in each case is one of determination of the real character of the transaction to be ascertained from the provisions of the deed viewed in the light of surrounding circumstances.

In paragraph 6 of the said report, principles for determination of the nature of a document are explained in following words:-

"6....The question in each case is one of determination of the real character of the transaction to be ascertained from the provisions of the deed viewed in the light of surrounding circumstances. If the words are plain and unambiguous they must in the light of the evidence of surrounding circumstances be given their true legal effect. If there is ambiguity in the language employed, the intention may be ascertained from the contents of the deed with such extrinsic evidence as may by law be permitted to be adduced to show in what manner the language of the deed was related to existing facts."

In D.S. Thimnappa -Vs.- Siddarnakka reported in (1996) 8 SCC 365, the appellant executed two deeds of sale dated 24th April, 1968 and 20th July, 1968 executed by the respondent transferring the schedule property. On 20th July, 1968 an agreement of reconveyance was also executed by the appellant with a stipulation that in the event of the respondent repaying Rs.500/- within eight years from the date in one lumpsum, she would be entitled to give the sale deed executed and registered in her favour.

It was contended on behalf of the appellant before the Hon'ble Supreme Court that in view of the specific recital in the deed of reconveyance that the respondent had to have the reconveyance executed within eight years from 20th July, 1968 and since she had not had the conveyance executed, the suit is barred by limitation.

The Hon'ble Supreme Court was pleased to hold that unless the deed of agreement of sale stipulated a date for performance, time is not always the essence of the contract. Factual background of the said reported decision is that the respondent not only denied the pleading of the appellant regarding her readiness and willingness to get the deed of sale executed within the stipulated period of time but also denied execution of any such deed of reconveyance. The High Court had, therefore, gone into the question whether there was an agreement of reconveyance and whether the respondent had performed her part of the contract in seeking reconveyance. Under those circumstances, the High Court held that had there not been any deed of reconveyance, and the appellant avoided the receipt of the consideration and execution of sale deed, the respondent had no occasion to approach and Advocate to get the notice issued asking the respondent to execute the sale deed. It is further held by the Hon'ble Supreme Court that under Article 54 of the schedule to the Limitation Act, 1963, limitation for specific performance begins to run from the date fixed in the contract or from the date of refusal to execute the sale deed. Since the time is not the essence of the contract, the respondent had offered the payment of the amount before the expiry of the deed of reconveyance but the appellant had refused to convey the same. The cause of action arose on expiry of eight years from the date of execution of the latter sale deed, i.e., on 20th July, 1968. The suit was filed within three years from the date of refusal by the respondent to execute the deed of reconveyance. Under such circumstances, the Hon'ble Supreme Court was pleased to hold that the suit was filed within the period of limitation.

In a subsequent decision in the case of Bibi Jaibunisha -Vs.- Jagdish Pandit reported in (1997) 4 SCC 481, the appellant had sold the suit property by a registered deed of sale dated 21st February, 1969 with a contemporaneous agreement of reconveyance for a consideration of Rs.4,000/-. The appellant had filed the suit on 7th April, 1975 for specific performance of reconveyance of the property. Both the Trial Court as well as the High Court dismissed the suit on the ground that the time was the essence of contract and the appellant had not performed the contract within the stipulated time and, therefore, the suit is barred by limitation. It was also held that the appellant failed to prove that she was ready and willing to perform her part of the contract. In the said decision, the Hon'ble Supreme Court referred to a relevant portion of paragraph 6 of a previous judgement in the case of Indira Kaur & Ors. -Vs.- Sheo Lal Kapoor reported in (1988) 2 SCC 488 which is also humbly considered to be very relevant in the instant matter. Paragraph 5 of Bibi Jaibunisha (Supra) is quoted below:-

"5. This Court in Indira Kaur & Ors. -Vs.- Sheo Lal Kapoor (1988) 2 SCC 488 at 496 in paragraph 6 held as under:-

On the question whether the time is of the essence of the contract or not we are satisfied that the High Court was in error in allowing the respondents to raise this question in the absence of specific pleadings or issues raised before the trial court and when the case of time being the essence of the contract was not put forward by the respondents in the trial Court. Apart from the absence of pleadings we do not find any basis for the plea of the respondents that the time was of the essence of the contract."

In Bibi Jaibunisha (supra), the Hon'ble Supreme Court also considered as to whether a transaction in the form of a deed of sale executed by the vendor in favour of vendee and a contemporaneous deed of reconveyance executed by the vendee in favour of vendor is in the nature of agreement for reconveyance or mortgaged by conditional sale. It is observed in the said report, "a deed as is well known must be construed having regard to the language used thereon". On examination of the said deed of reconveyance it was titled as "by Bi ul-Wafa" the Hon'ble Supreme Court held that the said document is not a mortgage by conditional sale but an agreement for reconveyance.

On examination of Section 58 (C) of the Transfer of Property Act, it was observed by the Hon'ble Supreme Court that for an ostensible sale deed to be construed as a mortgage by conditional sale, a condition that on repayment of the consideration by the seller, buyer shall transfer the property. The seller is embodied in the document which affects or purports to effect the same. In other words, in a deed of mortgage by conditional sale the execution of mortgage along with the condition for releasing the property on certain conditions must be stipulated in one document. However, in a transaction when a sale is effected contemporaneously with an agreement for sale executed by the vendee in favour of the vendor that he would reconvey the property sold in favour of vendor on payment of consideration price within a particular date but this is an agreement for sale and not a mortgage by conditional sale. The same principle was further reiterated by the Hon'ble Supreme Court in the case of Raj Kishore -Vs.- Prem Singh reported in (2011) 1 SCC 657. In Vithal Tukaram Kadam & Anr. -Vs.- Vamanrao Sawalaram Bhosale & Ors. reported in (2018) 11 SCC 172 the Hon'ble Supreme Court had the occasion to examine the nature of a document, those styled as sale deed, for a consideration of Rs. 700/- in view of its language used in the recital of the said deed. Paragraph 15 of the said report is very relevant to understand the factual background of the decision.

"15. The agreement, Ext. 62, though styled as a sale deed, for a consideration of Rs.700/- is but an ostensible sale, containing a clause for reconveyance. The agreement concludes as follows:

"If I repay your amount of Rs.700/- in any year (at any time) during the period of ten years from now then you have to return my said land to me, subject to this condition I have sold land to you."

The significance of the words "repay", "return" and "subject to this condition" cannot be overlooked. They are not commensurate with a deed of absolute sale. The language used, conveys the distinct impression that the plaintiff did not intend to relinquish all rights, title and claims to his lands. The defendant was aware of the limited nature of right conveyed and had agreed to a conditional sale along with an obligation to return the lands if the amount was repaid."

Upon due consideration of relevant facts and circumstances with the laws enunciated by the Hon'ble Supreme Court it was held in paragraphs 17 and 18 as under:-

"17. The parties were admittedly well known to each other since before. The plaintiff had been borrowing money from the defendant even earlier from time to time according to need, and even at the time of execution of the agreement he was in need of money. The value of the land was Rs.3,500/- far in excess of the amount of Rs.700/- mentioned in the agreement. The defendant in cross-examination did not deny the recital in Ext. 66, dated 11-6-1975 in reply to notice, that he had demanded the sum of Rs.3,500/- with interest for reconveyance. The relationship of debtor and creditor cannot be faulted with. The respondent did not take any steps for mutation for three long years after the execution of the deed. The plaintiff had specifically objected to mutation in the name of the defendant, by Exts. 33 and 34. The period for reconveyance provided in the agreement itself was inordinately long for ten years. The clause for reconveyance was in requirement with Section 58(c) of the Act. The High Court failed to consider the aforesaid factors in totality and in a holistic manner, while arriving at the finding that there was no debtor and creditor relationship between the parties, and that the agreement was a sale deed with an option to repurchase. The findings are clearly unsustainable.

18.The agreement, Ext. 62, is held to be a mortgage by conditional sale and not a sale with an option to repurchase. Consequently, the order of the High Court is held to be unsustainable and is set aside. The appeals are allowed."

During trial of the suit, the appellant no. 1 deposed as P.W. 1. He stated on oath that prior to Chaitra 1395 B.S. he himself requested the respondent to execute the deed of reconveyance on payment of money, but the defendant refused to execute and register the deed of sale as per the deed of reconveyance. P.W. 1 further stated that during his lifetime his father also repeatedly requested the defendant/respondent to execute the said deed of sale but he refused. In cross-examination P.W. 1 stated that his father tendered money to the defendant in September, 1987 for the first time. His father died on 27th October, 1987. After the death of his father P.W. 1 tendered the consideration money to the defendant but he could not state the exact date when such money was tendered. Lastly, he tendered consideration money to the respondent in the month of Chaitra 1395 B.S. in presence of Naren Mondal but the respondent refused to accept the consideration money and execute the deed of sale in favour of the appellants.

D.W. 1 admitted in his cross-examination that appellant no. 1 is a school teacher and at the relevant point of time he used to get Rs.3,000/- / Rs.4,000/- as his salary.

I am not unmindful to note that while deciding second appeal, the High Court cannot look into the factual circumstances and evidence on fact. However, if it is found that consideration of the evidence on record on factual aspect by the Lower Appellate Court was improper rendering decision of the Court perverse, the Second Appellate Court can reappreciate the evidence on record for such limited purpose.

In the instant case the Lower Appellate Court refused to accept the evidence of the appellant no. 1 on the point of tendering money to the respondent and requesting him to execute the deed of sale in their favour in respect of their suit property on the ground that the appellants failed to examine one Naren Mondal in whose presence the appellant allegedly tendered the consideration price to the respondent and the respondent refused to accept such consideration money. The learned Court of Appeal failed to appreciate the evidence of the appellant no. 1 that the name of Naren Mondal as a witness of tendering money by the appellant no. 1 to the respondent transpired in course of cross-examination. While a fact comes to the light during cross-examination of a witness, such evidence binds the adversary and no corroborating witness is required to be examined in such case.

From the evidence on record, it is ascertained that the appellants were all along ready and willing to perform their part of agreement within the stipulated period of time. It is also ascertained from the evidence of the respondent that the appellant no. 1 had adequate means to perform his part. Practically, the suit was filed only three days after the stipulated time limit had expired. At the time of filing of the suit, the appellants deposited the consideration money with the Court. The appellants in their pleadings also claimed that they were always ready and willing to perform the essential terms of the agreement for reconveyance to be enforced against the respondent in compliance of Section 16 (C) of the Specific Relief Act, 1963.

The learned Trial Court correctly found that since the respondent failed to perform his part of agreement by executing a deed of sale in favour of the appellants within the stipulated period of time, Article 54 of the schedule of the Limitation Act, 1963 is applicable and the suit cannot be held to be barred by limitation.

In view of the above discussion, substantial questions of law as formulated by the Division Bench of this Court are answered in favour of the appellant.

As a result, the appeal is allowed on contest, however, without cost.

The judgement and decree passed by the learned First Appellate Court in Other Appeal No. 15 of 2000 is set aside and the one passed in Other Suit No. 108 of 1989 is restored.

Urgent photostat copy of the judgement, if applied for, be given to the learned Advocates for the parties on the usual undertakings.