Supreme Court of India
Fatehji & Company & Anr vs L.M. Nagpal & Ors on 24 April, 2015Author: …………………………….J.
Bench: V. Gopala Gowda, C. Nagappan
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOs. 3912 OF 2015
[Arising out of Special Leave Petition (Civil) No.35686 of 2013]
Fatehji & Company & Anr. .. Appellants
L.M. Nagpal & Ors. .. Respondents
J U D G M E N T
C. NAGAPPAN, J.
This appeal is preferred against the judgment and order dated 19.7.2013 in
R.F.A. no.350 of 1997 passed by the High Court of Delhi in which the High
Court allowed the Appeal by setting aside the order dated 7.8.1997 of the
Court of Additional District Judge, Delhi rejecting the plaint in Suit
no.87 of 1994.
Briefly the facts are as follows : The perpetual lease hold right in
respect of the suit land as vacant plot was granted in favour of original
lessee Col. A.N. Kapur by registered lease deed dated 16.4.1962 by the
Government of India and he built two storied building with barsati and he
sold his rights in the said property to the first defendant-Firm by
registered sale deed dated 6.5.1963. The first defendant entered into a
written agreement of sale dated 2.7.1973 in respect of the suit property
with Smt. Ram Pyari. As per the terms of the agreement the possession of
the suit property including the building was handed over to Smt. Ram Pyari
Nagpal on the date of agreement itself. The date for execution of the sale
deed was fixed for 2.12.1973. Extension of time for execution of sale deed
on the plea of obtaining permission to sell the property from the lessor
was sought by the defendants by way of letters and the last of such
extension was sought for six months w.e.f. August 1976. The sons of second
defendant in July 1985 filed a suit seeking for declaration that the suit
property is joint family property and the sale made by defendants in favour
of plaintiffs be declared as null and void, was filed against defendants 2,
3 and the plaintiffs and on contest the same was dismissed on 5.4.1989.
According to the plaintiffs the final cause of action accrued and arose
after August 1991 when the defendants began hiding themselves and avoiding
the plaintiffs and they filed the suit on 29.4.1994 seeking for a decree
for specific performance of the agreement of sale dated 2.7.1973 against
The defendants 1 to 3 filed an application under Order VII Rule 11 CPC on
10.10.1996 seeking for rejection of the plaint as barred by the law of
limitation. The Trial Court after hearing both sides by a speaking order
held that the suit is patently barred by the law of limitation and allowed
the application by rejecting the plaint. The plaintiffs preferred appeal
in RFA no.350 of 1997 and the High Court by the impugned judgment allowed
the appeal by setting aside the order of the Trial Court and restored the
suit to file. Aggrieved by the same the defendants have preferred the
present appeal. For the sake of convenience, the parties are hereinafter
referred to as they were arrayed in this suit.
5. The learned senior counsel appearing for the appellants/defendants
submitted that the suit patently appears to be barred by law of limitation
by looking at the plaint averments and the High Court committed manifest
error in arriving at a finding that the suit has to be tried. He relied on
the decisions of this Court in Ahmadsahab Abdul Mulla (2)(Dead) by proposed
Lrs. vs. Bibijan and ors. (2009)5 SCC 462 and Church of Christ Charitable
Trust and Educational Charitable Society represented by its Chairman vs.
Ponniamman Educational Trust represented by its Chairperson/Managing
Trustee (2012) 8 SCC 706. Per contra the learned counsel appearing for the
respondents contended that although the agreement of sale dated 2.7.1973
had a fixed date for performance, the defendants by subsequent letters
sought for extension for obtaining permission of lessor viz. Land &
Development Office (L&DO) and the said permission was not taken till now
and the High Court has rightly dismissed the claim for rejection of plaint.
He relied on three decisions of this Court in S. Brahmanand and ors. vs.
K.R. Muthugopal (Dead) and ors. (2005) 12 SCC 764, Panchanan Dhara and ors.
vs. Monmatha Nath Maity (Dead) through Lrs. and anr. (2006) 5 SCC 340 and
Niranjan Kumar and ors. vs. Dhyan Singh and anr. (1976) 4 SCC 89.
6. We considered the rival submissions. The specific performance is
claimed of a written agreement of sale dated 2.7.1973 and as per the terms
the performance of the contract was fixed till 2.12.1973. The defendants
by subsequent letters dated 7.4.1975, 1.10.1975 and 1.8.1976 sought for
extension of time to enable them to obtain permission of lessor and the
last extension of six months expired on 1.2.1977. In view of Order VII
Rule 11(a) and 11(d) the Court has to satisfy that the plaint discloses a
cause of action and does not appear to be barred by any law. Article 54 of
the Limitation Act stipulates that the limitation for filing the suit for
specific performance of the contract is three years from the date fixed for
the performance or if no such date is fixed, when the plaintiff has noticed
that performance is refused.
7. The fact that the plaintiffs were put in possession of the property
agreed to be sold on the date of agreement itself would not make any
difference with regard to the limitation of filing the suit for specific
performance. In fact both the courts below have rightly held that Article
54 of the Limitation Act does not make any difference between a case where
possession of the property has been delivered in part performance of the
agreement or otherwise. In the same way the courts below have also
concurrently held even if any permission is to be obtained prior to the
performance/completion of the contract, the mere fact that the defendants
have not obtained the said permission would not lead to inference that no
cause of action for filing the suit for specific performance would arise.
Further it is also not the case for postponing the performance to a future
date without fixing any further date for performance. The last extension
for a period of six months w.e.f. 1.8.1976 sought for by the defendants
expired on 1.2.1977. The present suit seeking for specific performance was
filed by the plaintiffs on 29.4.1994, much beyond the period of three
8. Yet another circumstance was pointed out to prove the laches on the
part of the plaintiffs. The sons of the second defendant filed a suit in
July 1985 against defendants 2, 3 and the plaintiffs seeking for
declaration that the present suit property is their ancestral joint family
property and the sale made by the defendants in favour of the plaintiffs be
declared as null and void. The plaintiffs herein contested the said suit
and it came to be dismissed on 5.4.1989. The suit for specific performance
was not filed within three years from the said date also.
9. The plaintiffs averred in the plaint that the last and final cause of
action accrued and arose to them after August 1991 when the defendants
succeeded in hiding themselves and started avoiding the plaintiffs and the
cause of action being recurring and continuous one, they filed the suit on
29.4.1994. As already seen the original cause of action became available
to the plaintiffs on 2.12.1973, the date fixed for the performance of the
contract and thereafter the same stood extended till 1.2.1977 as requested
by the defendants. Though the plaintiffs claimed that oral extension of
time was given, no particulars as to when and how long, were not mentioned
in the plaint. On the other hand even after knowing the dishonest
intention of the sons of the second defendant with regard to the suit
property in the year1985, the plaintiffs did not file the suit immediately.
The suit having been filed in the year 1994 is barred by limitation under
Article 54 of the Limitation Act.
10. We are of the view that the High Court committed manifest error in
reversing the well considered order of the Trial Court rejecting the plaint
as barred by the law of limitation and the impugned judgment is liable to
be set aside. In the result, the appeal is allowed and the impugned
judgment of the High Court is set aside and the order of the Trial Court is
restored. No costs.
(V. Gopala Gowda)
April 24, 2015