Susila vs Rajagopala Pathar (died) and Others

A. Ramamurthi, J.

defendant has preferred the second appeal aggrieved against the judgment and decree made in A.S.No. 64 of 1983, dated 12.12.1983 on the file

of District Court, East Thanjavur, Nagapattinam, confirming the decree and judgment of the Court of the Subordinate Judge of Mayiladuthurai in

O.S.No. 127 of 1981, dated 18.2.1983.

The case in brief is as follows: The plaintiff filed a suit for specific performance of the agreement of sale or in the alternative of recovery of Rs.

15,610 from the defendant. The plaintiff entered into a written agreement of sale in respect of the suit property with the defendant''s father Subba

Rao on 1.7.1976 agreeing to purchase the property for a sum of Rs. 16,500. As per the agreement, the parties have to complete the sale by

15.2.1977. But time is not the essence of the contract. The plaintiff paid a sum of Rs. 3,000 by way of advance even on the date of the agreement

and later paid Rs. 2,000 on 21.8.1976. Rs. 1,500 on 26.2.1977 and Rs. 1,000 on 1.7.1977 towards the agreement of sale. These payments were

endorsed by the plaintiff''s father on the agreement itself. The plaintiff also paid another sum of Rs. 3,000 on 10.8.1977 with the defendant''s father

but the same was not endorsed in the agreement. Thus in all, the plaintiff has paid a sum of Rs. 10,500 towards the sale transaction. The plaintiff

was and is ready and willing to pay the balance amount and complete the said sale transaction. The defendant''s father was postponing the

completion of the sale. On 20.8.1977, the defendants father issued a notice to the plaintiff, calling upon him to complete the sale within a week and

in the notice, he has not referred the several payments made by the plaintiff. The plaintiff thereupon issued a reply notice on 30.8.1977 expressing

his readiness and willingness, but, however, he did not come forward to complete the sale. On 19.9.1979, the plaintiff issued a notice to the

defendant''s father, calling upon him to complete the sale. The defendant''s father evaded to receive the same and the same was returned. The

father of the defendant died in August, 1980. The defendant is the only heir and legal representative of the defendant''s father. The plaintiff

approached her in the second week of October, 1980 to execute the sale deed, but she refused to do so. The plaintiff is ready and willing to pay

the balance of sale consideration viz., Rs. 6,000 and furnish the stamp papers. If for any reason the agreement of sale is not specifically performed

by the defendant he is entitled to get back from the defendant as an alternative remedy a sum of Rs. 10,500 with interest at 12% per annum from

10.8.1977 and this claim is made without prejudice his right from the main relief. The suit is in time having been filed within three years from the

date of refusal by the defendant to execute the sale deed.

The defendant resisted the suit contending that she came to know about the agreement only later. The plaintiff never met her in connection with

the sale agreement. Since the plaintiff did not perform his part of the contract during the life time of Subba Rao, it has become unenforceable after

his lifetime. The suit is also barred by limitation. The defendant has entered into an agreement on 31.1.1982 with one Kuppuswamy Ayyar to sell

the suit property for Rs. 13,000 and received Rs. 9,500. The plaintiff has been evading to perform his part of the contract. The suit has been filed

by the plaintiff in order to prevent her from selling the property to Kuppuswamy Iyer. The plaintiff was not in possession of funds to perform his

part of the contract. He is not entitled to the relief of specific performance also. The alleged payments said to have been made by the plaintiff to her

father are also denied.

The trial court framed 3 issues and Exs.A-1 to A-6 were marked and P.Ws.1 and 2 were examined on the side of the plaintiff. On the side of

the defendant, Exs.B-1 to B-3 were marked and D. W. 1 was examined. The trial court decreed the suit for specific performance of contract with

costs. The defendant preferred A.S.No. 64 of 1983 on the file of District Court, Nagapattinam and the appeal was also dismissed and aggrieved

against this, the defendant has come forward with the second appeal. After filing the second appeal, the plaintiff died and the legal representatives

are impleaded as respondents 2 to 7.

The points that arise for consideration are:

(1) Whether the plaintiff is entitled to the relief of specific performance of contract?

(2) Whether the suit is barred by limitation?

(3) Whether the plaintiff is entitled to the alternative relief for recovery of Rs. 15,610 with interest?

(4) To what relief?

Points: There is no dispute that the plaintiff and one Subba Rao entered into an agreement under Ex.A-1 dated 1.7.1976, whereby Subba Rao

agreed to convey the property for a sum of Rs. 16,500. The plaintiff further stated that even on the date of Ex.A-1, a sum of Rs. 3,000 was paid

by way of advance and apart from that subsequently, the payments were also made under Exs.A-2 to A-4 and they were also endorsed in the

document. Further a sum of Rs. 3,000 was also paid on 10.8.1977, but the same was not endorsed in the document. The plaintiff claimed that he

was always ready and willing to perform his part of the contract on payment of the balance amount, but only the father of the defendant was

postponing the same. Subbarao died in August, 1980 and the suit was filed on 3.9.1981.

The learned Counsel for the defendant contended that the plaintiff is not entitled to the relief of specific performance of contract as he had

committed breach of the contract. The plaintiff had no funds in his hands at the relevant point of time and he had not even purchased the necessary

stamp papers for engrossing the sale deed and complete the sale transaction. The suit filed by the plaintiff is also barred by time since even

according to Ex.A-1, the sale transaction has to be completed before 15.2.1977. However, the plaintiff is also not entitled to the discretionary

relief of specific performance on the facts and circumstances of this case. This relief is also not available to the party in a case where money

compensation is sufficient to meet the ends of justice. Both the courts below have also failed to consider the alternative relief of money

compensation claimed by the plaintiff. Article 54 of the Limitation Act is applicable to the case on hand. Even assuming that only second part of the

Article would apply, the last date for filing a suit is three years and even then the suit claim is barred by time in any view of the matter. The decision

relied on by both the courts below in New India Assurance Co. Ltd. .v. Food Corporation of India, etc. 96 L.W. 116, is not applicable.

I have heard the submissions of the learned Counsel on either side and also perased the Documents and other materials connected in the case.

Both sides have pointed out the relevant paragraphs in the judgment of the courts below. It is practically conceded that there is an agreement of

sale between the father of the defendant and the plaintiff under Ex.A-1, dated 1.7.1976. At1 one point of time, the defendant disputed the

payments said to have been made by the plaintiff under Exs.A-2 to A-4 and also on 10.8.-1977. However, P.W.2 has been examined in order to

prove these payments. Moreover, the plaintiff has pointed out these payments even during the life time of Subba Rao but, however, no rejoinder

was sent disputing these payments. It is only under these circumstances, both the courts came to the conclusion that payments under Exs.A-2 to

A-4 were made and they were also endorsed in the document and similarly the last payment of Rs. 3,000 was made on 10.8.1977. Now the

learned Counsel for the defendant is not seriously disputing about Ex.A-1 or the payments said to have been made by the plaintiff towards the sale

agreement. The main contention put forward by the learned Counsel for the defendant is that the suit claim is barred by limitation and further more

a discretionary relief of a specific performance cannot be granted to the plaintiff and at best, the plaintiff would be entitled to get recovery of the

amount which is claimed as an alternative relief.

Subba Rao issued a notice to the plaintiff under Ex.B-1, dated 20.8.1977 calling upon the plaintiff to perform his part of the contract. The reply

was sent under Ex.B-2 dated 30.8.1977. The learned Counsel for the defendant first contended that time is the essence of the contract since there

is a recital in the document itself that the parties have to complete the sale by 15.2.1977 and as the suit has not been filed within three years, the

suit is barred by time. The learned Counsel for the plaintiff contended that time is not the essence of the contract since even after the expiry of

15.2.1977 several payments have been made with Subba Rao and he had received the same. The learned Counsel for the plaintiff further pointed

out that the second part of Article 54 of the Limitation Act alone can be made applicable to the case on hand and in that case, the cause of action

will commence only from the date of refusal of a specific performance of contract. The plaintiff sent a notice under Ex. A-1, dated 19.9.1979 and

the notice was returned undelivered and as such, the suit was filed within three years from the said date. The learned Counsel for the defendant

would contend that first part of Article 54 of the Limitation Act alone can be applicable and if that be so, the suit is barred by-time and, as such,

the plaintiff is not entitled to the relief of specific performance.

The learned Counsel for the defendant relied upon a Bench decision of this Court in P. Sivan Muthian and Ors. v. John Sathiavasagam (1980)

1 M.L.J. 490, wherein it is observed that, ""the first part of Article 54 of the Limitation Act could be invoked only when there is a definite date fixed

for performing the contract. It is true that the expression ''date fixed'' could mean either the date expressly fixed or the date which can be fixed with

reference to a future event, which is certain to happen. If on the other hand, the date is to be ascertained, depending upon an event which is not

certain to happen, this part of Article 54 is not at all applicable. In that contingency, it is only the latter part of Article 54 that could be invoked

treating the case as one in which no date has been fixed for performance and that would be three years from the date when the plaintiff has notice

that performance is refused."" This decision is exactly applicable to the case on hand.

The learned Counsel for the defendant also relied upon another decision of this Court in Rajamani Ammal v. Neelambal Ammal alias Neela

(1995) 2 L. W. 710, wherein it is observed that, ""if a date is fixed for the performance of the contract, under an agreement for specific

performance the period of limitation is three years from the said date. Only if no such date is fixed, the three years period begins to run from the

date when the plaintiff has notice that the performance is refused. Where the time for performance is fixed, limitation would begin to run as from

that time and the question whether time was the essence of the contract is not relevant for determining whether column 3 to Article 54 would

apply"". This decision is exactly applicable to the case on hand in all fours .

It is clear from Article 54 of the Limitation Act that for specific performance of a contract, the period of limitation is three years. Column 3

relates to the commencement of the cause of action. The date fixed for the performance, or if no such date is fixed, when the plaintiff has notice,

that performance is refused. The plaintiff takes shelter under Second part of Article 54 whereas the defendant is relying upon the first part of

Article 54. The ratio from the aforesaid decisions is evidently clear that only if no such date is fixed, the three years period begins to run from the

date when the plaintiff had notice that the performance is refused. But under Ex.A-1, there is a clear recital that the sale has to be completed by

15.2.1977 and accordingly, I am of the view that part 1 of Article 54 alone will apply to the case on hand. If that be so, the plaintiff ought to have

filed a suit on or before 15.2.1980. However, the suit has been filed much thereafter, it is also necessary to state that although Subba Rao, (the

father of the defendant) died in August, 1980 the plaintiff has not chosen to file the suit immediately but he waited and filed the same only on

3.9.1981. Hence, it is evidently clear that the suit filed by the plaintiff is barred by time and only to get over the same and the bring the case under

part 2 of Article 54, the plaintiff contended that he has got notice that performance was refused only on 19.9.1979. Both the courts below have

not properly appreciated the position of law and there was miscarriage of justice. As the suit filed by the plaintiff was barred by time, the plaintiff is

not entitled to the claim of specific performance of the agreement of sale and, as such, the findings of both the courts below are liable to be set

aside.

The plaintiff has claimed an alternative relief of recovery of the amounts paid by him with interest, even in the lower appellate court, the

defendant stated that she has no objection to repay the sum of Rs. 10,500 with interest. The lower appellate court also gave a finding that the

plaintiff would be entitled to a decree for recovery of Rs. 10,500 with interest at 6% from the date of plaint till realisation and the same is not

disputed now. As adverted to even in the grounds of appeal, it is stated that the plaintiff would be entitled to get return of the amount and not the

relief of specific performance. Hence, I hold that the plaintiff would be entitled to a decree for recovery of a sum of Rs. 10,500 with interest at 6%

per annum from the date of suit till realisation.

For the reasons stated above, the second appeal is allowed and the judgments and decrees of the courts below are set aside and the suit is

decreed that the plaintiff would be entitled to the alternative relief of recovery of a sum of Rs. 10,500 with interest at 6% per annum from, the date

of suit till date of realisation and in other respects, the suit is dismissed. In the peculiar circumstances, there will be no order as to costs.