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REPORTABLE   

 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

       -vs-

L.M. Nagpal & Ors.  ..    Respondents

J U D G M E N T

C. NAGAPPAN, J.

1. Leave granted.

2. 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.  

3. Briefly the facts are as follows : The perpetual lease hold right

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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

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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.

4. 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

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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

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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

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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 years.

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

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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

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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.          

…………………………….J. (V. Gopala Gowda)

…………………………….J. (C. Nagappan)

 New Delhi;   April 24, 2015