Karnataka High Court
H M Ramaswamy vs H Krishnappa on 12 December, 2013
Author: B.S.Indrakala
Bench: B.S. Indrakala
RFA No.896/2003
1
IN THE HIGH COURT OF KARNATAKA AT BANGALORE
Dated this the 12th day of December 2013
Before
The Hon'ble Mrs. Justice B.S. INDRAKALA
Regular First Appeal No.896/2003
BETWEEN:
Sri H.M.Ramaswamy,
S/o Late Muniswamappa,
Aged about 53 years,
R/at Immadihalli Village,
K.R.Puram Hobli, Bangalore South Taluk.
... Appellant
(By Sri A.G.Shivanna, Advocate.)
AND:
1. Sri H.Krishnappa,
S/o Hanumanthappa,
Since deceased by LRs.
1(a) Manjula,
W/o Late H.Krishnapa.
1(b) Harsha,
S/o Late H.Krishnappa,
Aged 15 years, Minor rep. by his
natural guardian R(a).
Both are r/o Immadihalli Village,
K.R.Puram Hobli,
Bangalore South Taluk.
(amended as per court order dated 15.10.2009)
RFA No.896/2003
2
2. Sri M.Bhadraiah,
S/o Muniswamappa @ Doddabbaiah,
R/a Immadihalli Village, K.R.Puram Hobli,
Bangalore South Taluk.
... Respondents
(By Sri B.T.Indu Shekar, Advocate for R-1(a);
R-1(b) is minor rep. by R-1(a); R-2 served.)
This Regular First Appeal filed under Section 96 of
CPC against the judgment and decree dated 07.03.2003
passed in O.S.No.51/1995 on the file of the Prl. Civil Judge
(Sr.Dn.), Bangalore Rural District, Bangalore, decreeing the
suit for the relief of specific performance.
This appeal being reserved and coming on for
pronouncement of judgment this day, B.S.Indrakala J.,
delivered the following:
JUDGMENT
The first defendant in O.S.No. 51/1995 on the file of the Principal Civil Judge (Sr. Dn.), Bangalore Rural District, Bangalore has preferred the above appeal against the judgment and decree dated 07.03.2003 passed in the said suit.
2. For the sake of convenience the parties herein are referred to by their respective rank as arrayed before the Court below i.e., appellant and the 2nd respondent RFA No.896/2003 3 as defendant Nos. 1 and 2; the 1st respondent as plaintiff,
3. The plaintiff filed the 1said suit seeking judgment and decree for specific performance directing the defendants to execute the registered sale deed in his favour contending that the defendants being the absolute owners of the property mentioned in the schedule to the plaint offered to sell the said property during September, 1989 and the plaintiff agreed to purchase the same; accordingly for a sale consideration of Rs.1,12,000/-, an agreement was executed on 04.09.1989 under which the plaintiff paid a sum of Rs.10,000/- as part consideration. It is further contended that in the said agreement, a condition was also stipulated that the balance of sale consideration would be paid within three months thereon, but, the 1st respondent expressed that he got inconvenience for executing the registered sale deed as permission was RFA No.896/2003 4 not yet obtained to execute the same, however he requested for payment of balance of sale consideration and sought time to execute the regular registered sale deed. It is further alleged by the plaintiff that the 1st defendant had agreed that on obtaining such permission, he would execute the sale deed; in the circumstances second agreement was also executed to which, the 1st defendant got the signature of his brother/2nd defendant and his father also and he paid the entire balance of sale consideration on 15.11.1989.
4. It is specifically alleged that even though there was partition between the defendants, the same was not reduced into writing and it is for that reason, the plaintiff insisted for consent of the 2nd respondent as well as that of the father of the 2nd defendant and accordingly, they also signed the execution of said agreement of sale vide Annexure-B. It is the specific case of the plaintiff that in pursuance of the Annexure- RFA No.896/2003 5 B, he was also put in possession of the property and continues to be in possession and enjoyment of the same; meanwhile, father of the defendants died in the year 1992 despite which his name is still being shown in the Khatha and cultivators column as per the RTC extract. Further, though the plaintiff was ready and willing to perform his part of the contract, defendant No.1 went on postponing the same, on the assurance that he would execute the sale deed after some time as the permission needed, is not yet granted; he also stated that the khatha and the said revenue records will have to be changed in his name and as such it was not possible to execute the registered document unless those formalities are carried out. It is contended further that two days earlier to the filing of the suit, the plaintiff reliably learnt that the defendants were making hectic efforts to sell away the schedule property along with the property of the 2nd defendant and that they were searching for prospective purchaser and just a day prior RFA No.896/2003 6 to filing of the suit when the plaintiff questioned the defendants about their activities and requested the 1st defendant to execute the sale deed, the first defendant contended that the value of the property is increased and so he was preparing to sell away to whom so ever who pays the highest sale consideration etc. It is alleged further that in the circumstances, the cause of action for the suit arose as on the date of the agreement i.e., 04.09.1989 and on the date of payment of the balance of the entire sale consideration on 15.11.1989 on the day when the defendant refused to execute the registered sale deed i.e., a day prior to filing of the suit seeking specific performance.
5. Defendant No.1 in his written statement denied his absolute right over the property in question to execute such an agreement; On the other hand, he pleaded that the father of the defendant had 1 acre 24 guntas in the said survey number; that the defendants RFA No.896/2003 7 and their sisters constitute Hindu Undivided Family and there is no partition of the joint family properties as alleged in the plaint and has denied the execution of the agreement of sale on 04.09.1989 and further acknowledgement on 15.11.1989. Further it is specifically pleaded that the said documents are forged, fabricated and concocted with material alterations and he has not executed any such agreement or agreements.
6. It is also pleaded by the 1st defendant that the plaintiff was never put in possession of the suit schedule property, much less, under any agreement and has also denied all other averments with regard to the alleged instances on the part of the plaintiff seeking execution of the sale deed and the demand made by him just a day prior to the filing of the suit and specifically pleaded that the plaintiff is a business man by profession having a provision store in the village and is also a money lender, while the defendants are having RFA No.896/2003 8 regular account with the plaintiff for the last 10 years; they used to borrow money for agricultural operations from the plaintiff on simple interest of 18% p.a.; they also used to purchase provisions in his shop and in the year 1989, they borrowed a sum of Rs.40,000/- for their agricultural operations namely for sowing potato and while lending the above said amount, the plaintiff took their signature on a blank paper by way of security for the amount that he had advanced on interest basis and accordingly, defendants as well as their father signed the said blank stamp paper and the understanding was to return the said papers when the account of the defendants with the plaintiff was settled. It is also pleaded that in the month of January 1995, the defendants approached the plaintiff to settle their accounts and the plaintiff claimed Rs.1,12,000/- against only a sum of Rs.70,000/- payable by them and on that allegation, the plaintiff by misusing the signed blank stamp papers filed the suit seeking execution of RFA No.896/2003 9 the sale deed in favour of the plaintiff and thus, the defendants sought dismissal of the suit.
7. On the basis of the said pleadings, the following issues were framed:
1) Whether the plaintiff proves that the 1st defendant executed the sale agreement dated 04.09.1989 and has received a sale consideration of Rs.10,000/- in advance?
2) Whether the plaintiff proves that the defendants and their father have jointly executed the sale agreement dated 15.11.1989 and received the entire sale consideration agreed?
3) Whether the plaintiff proves that he was put in possession of the suit schedule properties on the date of sale agreement?
4) Whether the defendants prove that the alleged sale agreements are got up fabricated documents as pleaded in para- 10 of the written statement?
5) Whether the suit is time barred?
6) Whether the plaintiff is entitled for the relief of specific performance of the contract?
7) To what decree what order?
RFA No.896/200310
8. To prove his case, the plaintiff got himself examined as P.W.1 apart from examining two more witnesses as P.Ws. 2 and 3 and on behalf of the defendants, the 1st defendant is examined as D.W.1 and another witness is examined as D.W.2, on behalf of the plaintiffs, the said two agreements are marked as Exs.P.1 and P. 2 and RTC extract as Ex.P.3 and no document is marked on behalf of the defendants.
9. On considering the said evidence so placed on record, the trial Court deemed it fit to decree the suit with cost vide its judgment dated 07.03.2003.
10. Being aggrieved by the said judgment and decree so passed, the 1st defendant preferred the above appeal interalia contending amongst other grounds that the evidence placed on record is not properly appreciated; the Court failed to consider that the subject matter of the suit was not the absolute property of the appellant; no proper issues were framed which RFA No.896/2003 11 are required to be assessed in the suit for specific performance i.e., with regard to readiness and willingness of the plaintiff to perform his part of the contract. It is further contended that when execution of the agreement for sale is specifically denied, in the absence of evidence of the attesting witness, the Court ought to have rejected the said agreement of sale. It is further specifically contended that the Karnataka Prevention of Fragmentation and Consolidation of Holdings Act, 1966 (for short 'KPFCH Act') was repealed by Act No.4/1991 and the same came into effect on 05.02.1991 and in the circumstances, the plaintiff ought to have filed the suit within 3 years from the date of such repeal; the suit filed beyond 3 years from the said date of repeal in the year 1995 is clearly barred by limitation which the Court failed to observe and the suit ought to have been dismissed in liminae as barred by limitation etc., and sought allowing of the appeal. RFA No.896/2003 12
11. Heard the learned Counsel for the appellant as well as the Counsel for respondent No.1(a) and 1(b).
12. In view of the submissions made the points that arise for consideration are:
i) Whether the judgment and decree dated 07.03.2009 passed in O.S.No.51/1995 on the file of the Principal Civil Judge, Senior Division, Bangalore Rural District, Bangalore are liable to be set aside?
ii) What order?
13. On perusal of the agreement on which the suit is based, which is marked as Ex.P.1, it is seen that the first agreement is dated 04.09.1989 and there is a specific clause in the said agreement that the sale consideration was fixed at Rs.1,12,000/- for land measuring 32 guntas and a sum of Rs.10,000/- is paid under the said agreement as part consideration, for payment of balance of Rs.1,02,000/-, the time limit was fixed as 3 months and there is also a specific condition that if within 3 months, the balance of sale RFA No.896/2003 13 consideration is paid, the plaintiff can execute the agreement of sale.
14. On perusal of Ex.P.2, the 2nd agreement executed between the same parties, it is seen that the same is dated 15.11.1989 and it is executed within 3 months from the date of the first agreement and a mention is also made in the said agreement with regard to earlier agreement dated 04.09.1989 and in the circumstances, it can be said that the second agreement is in continuation of the first agreement. However, in the 2nd agreement, there is an extra clause inserted which reads as under:
"DzÁV £Á£ÀÄ ªÀÄvÀÄÛ £ÀªÀÄä CtÚ JA. ¨sÀzÀæAiÀÄå£ÀªÀgÀÄ £ÀªÀÄä vÀAzÉUÉ E§âgÉà UÀAqÀÄ ªÀÄPÀ̽zÀÄÝ £ÀªÀÄä vÀAzÉ ¦vÁæfðvÀ ªÀÄvÀÄÛ ¸ÀéAiÀiÁfðvÀªÁzÀ ¸ÀévÀÄvÀÄUÀ¼À£ÀÄß FUÉÎ ¸ÀĪÀiÁgÀÄ ºÀ¢ªÀÄÆgÀÄ ªÀµÀðUÀ½AzÉAiÉÄà DV£À ¥ÀAZÁ¬ÄÛÛzÁgÀgÀ ¸ÀªÀÄPÀëªÀÄ dĨÁ£É «¨sÁUÀzÀ ªÀÄÆ®Ì £ÀªÀÄä vÀAzÉ ªÀÄĤ±ÁªÀÄ¥Àà£ÀªÀgÀ EZÉÑAiÀÄAvÉ ¸ÀéAiÀiÁfðvÀ ªÀÄvÀÄÛ ¦vÁæfðvÀªÁzÀ D¹ÛUÀ¼À£ÀÄß AiÀÄgÀqÀÄ ¨sÁUªÁV «¨sÁUÀzÀ ªÀÄÆ®Ì £À£Àß ºÉ¸ÀjUÉ ¥ÀAZÁ¬ÄÛzÁgÀgÀÄ £ÀªÀÄä vÀAzÉAiÀĪÀgÀÄ ©nÖgÀvÀPÀÌ £À£Àß ¨sÁUÁA±À ¸ÀévÀÛ£ÀÄß F PÉ®PÀAqÀ µÉqÀÆå¯ï ¸ÀévÀÛ£ÀÄß £Á£ÀÄ ¤ªÀÄUÉ vÁjÃRÄ 04.09.1989 gÀ°è ±ÀÄzsÀÝ PÀæAiÀÄPÉÌ ªÀiÁj ¸ÀzÀj PÀæAiÀÄzÀ ªÉƧ®V£À°è CAzÀgÉ PÀÄAmÉ RFA No.896/2003 14 ªÀAzÀPÉÌ 3500-00 gÀÆ¥Á¬Ä£ÀAvÉ ¤zsÀðj¹ £À£Àß ¨sÁUÀzÀ ¸ÀéwÛUÉ CAzÀgÉ ªÀÄƪÀvÉÛgÀqÀÄ UÀÄAmÉUÀ½UÉ DUÀĪÀ MAzÀÄ ®PÀë ºÀ£ÉßgÀqÀÄ ¸Á«gÀ gÀÆ¥À¬ÄUÀ¼À°è 04.09.1989 gÀ°è ¤«ÄAzÀ CqÁé£ÁìV ºÀvÀÄÛ ¸Á«gÀ gÀÆ¥À¬ÄUÀ¼À£ÀÄß £ÀUÀzÁV ¥ÀqÉzÀÄPÉÆAqÀÄ ºÀvÀÄÛ gÀÆ¥À¬Ä£À bÁ¥Á PÁUÀzÀzÀ £ÀA. 7216 - 1-9-89 gÀ°è jf¸ÀÖgÀÄ £ÀA§gÀÄ PÁUÀzÀzÀ°è §gɹPÉÆlÄÖ ºÀtªÀ£ÀÄß ¥ÀqÉzÀÄPÉÆArgÀÄvÉÛãÉ. ¨ÁQ G½AiÀÄĪÀ MAzÀÄ ®PÀë AiÀÄgÀqÀÄ ¸À«gÀ gÀÆ¥Á¬ÄUÀ¼À£ÀÄß F ¢£À F PɼÀPÀAzqÀ ¸ÁQëUÀ¼À gÀÆ§Ä gÀÆ§Ä ¤ªÀÄäAzÀ £ÀUÀzÁV ¥ÀqÉzÀÄPÉÆAqÀÄ F ¥ÀvÀæªÀ£ÀÄß §gɹPÉÆnÖgÀÄvÉÛãÉ. ¸ÀévÀÄÛ jf¸ÀÖgï ªÀiÁr¹PÉÆqÀ®Ä ¸ÀPÁðgÀzÀ DzÉñÀ«®èzÉ EgÀĪÀ PÁgÀt ¸ÀévÀÄÛ F ¢£ÀªÉà ¤ªÀÄä ¸Àħ¢ðUÉ ©lÄÖ F CVæªÉÄAn£À ªÀÄƮ̸ÀA¥ÀÆtð C¢üPÁgÀ PÉÆnÖgÀÄvÉÛãÉ. ¸ÀPÁðgÀzÀ DzÉñÀ §AzÀ vÀPÀët «²µÀÖ PÀZÀÄðUÀ¼ÉÆA¢UÉ ¤ÃªÀÅ w½¹zÀ°è £Á£ÀÄ ©£ï vÀPÀgÁgÀÄ ¥Àr¸ÀzÉà µÉqÀÆå¯ï ¸ÀévÀÄÛ jf¸ÀÖgÀÄ ªÀiÁr¹PÉÆqÀĪÀ ºÀPÀÄÌ «£ÀºÁ ¸ÀéwÛ£À AiÀiÁªÀ «zsÀªÁzÀ ºÀPÀÄÌ ¨ÁzsÀåvÉUÀ½gÀĪÀÅ¢¯Áè."
15. Thus, basically it is seen that under the second agreement with regard to date of completion of the sale transaction, a condition was imposed that inspite of passing of the entire sale consideration and putting prospective purchaser in possession of the property, as there was bar for executing the sale deed, a condition was stipulated that, the moment the RFA No.896/2003 15 permission/direction is obtained from Government, the sale deed would be registered. In this regard the counsel for both appellant and respondents submitted that direction/permission referred in the said argument is with regard to the KPFCH Act.
16. Admittedly, the said KPFCH Act was repealed on 02.02.1991 and as per the said clause in the argument, the suit ought to have been filed within 3 years from the said date of repeal. In this regard, the learned counsel appearing for the respondent/plaintiff contended, that, as on the date of execution of the said agreement of sale, there was no certainty about the lifting of the KPFCH Act; it was uncertain event, hence no much importance can be given to the said clause, and he further contended that time was not the essence of the contract; the entire transaction is covered under Article 54 (2) of the Limitation Act i.e., the date of refusal to execute the sale deed has to be considered. RFA No.896/2003 16
17. The learned Counsel for the appellant submitted that the suit filed by the plaintiff is basically barred by limitation. In that regard, he contended that according to the plaintiff, the first agreement is dated 04.09.1989 under which, the time fixed for completion of the contract was 3 months and the second agreement is alleged to have been executed on 15.11.1989 and under the said agreement, the entire sale consideration is said to have been paid. Though there is no time fixed, expressly, there is a condition stipulated that the sale deed would be registered after obtaining the required direction from the Government and if on obtaining such direction (permission), if the vendor fails to execute the said sale deed, the purchaser is at liberty to enforce the agreement in accordance with law. Further he contended that if at all if there is no time fixed for completion of the contract, the cause of action to file the suit will arise from the date of refusal to perform the conditions in the contract and not RFA No.896/2003 17 otherwise. Further he submitted that, there is no demand for performance and as such, it cannot be said that the cause of action arises on the day prior to the filing of the suit as contended by the plaintiff.
18. The learned Counsel for the appellant further submitted that apart from the said delay it is also to be noted that even with regard to the alleged demand to execute the sale deed and the alleged refusal on the part of the first defendant, it is seen that no evidence whatsoever is adduced in that regard, except stating in the examination-in-chief about the same; further in the course of his cross-examination at para-21, the plaintiff has deposed that he does not know about the details as to how and to whom the first defendant tried to sell the property in favour of others and while he was cultivating the lands, the first defendant had brought some persons and was showing the lands and as such, he came to know that the defendant was making arrangements to RFA No.896/2003 18 sell the property, but, he did not enquire with the said persons, who came there about the same. Further, he contended that the alleged ground for him to demand execution of the sale deed is not established and the plaintiff has not chosen to adduce any corroborative evidence either with regard to the alleged intention of the first defendant to sell the property to others or with regard to he demanding the first defendant to execute the sale deed and the first defendant refusing to do so.
19. Further he contended that the direction which was to be obtained from the Government is with regard to the restrictions imposed for alienation under the KPFCH Act as the property sought to be conveyed was only 32 guntas and if the said obstacle of getting the sale deed executed is removed or repealed, then the cause of action for the suit arises from the said date. Further he submitted admittedly the said enactment RFA No.896/2003 19 was repealed on 02.02.1991 and the suit for enforcement of specific performance of the said agreement ought to have been filed within 3 years from the said date i.e., on or before 2.2.1994 but the suit is filed in the year 1995 much beyond the period of limitation and hence the suit is clearly barred by limitation.
20. Per contra, learned Counsel for respondent No.1 submitted that time was not at all the essence of the contract under Ex.P.2 and as such the date of repealing of the Act, cannot be construed as the date from which time begins to run. Further he submitted that in the absence of stipulating any time limit, the period of limitation will have to be calculated as enumerated in Part-II of Article 54 of the Limitation Act i.e., the date on which the appellant has the notice of refusal to register and as alleged in the plaint itself, the purchaser on noticing the conduct of his vendor in RFA No.896/2003 20 trying to alienate the property in question to others which amounted to refusal to register the sale deed in favour of the purchaser amounted to deemed notice of refusal and such notice of refusal has occasioned just few days earlier to filing of the suit in which event the suit filed within few days from such refusal is well within time as prescribed under Part-II of Article 54 of the Limitation Act.
21. Thus in view of such contentions of both Counsel, basically it has to be found out as to whether the terms and conditions of the agreement falls under the first limb of Article 54 or second limb of Article 54 of the Limitation Act. Article 54 of the Limitation Act stipulates two dates as the time from which the period begins to run for the purpose of computing the period of 3 years of limitation to file the suit for specific performance of the contract. As per the first part, the first date is the date fixed for the performance of the RFA No.896/2003 21 contract specifically in the agreement itself and the second limb is that if no such date is fixed i.e., from the date on which the plaintiff gets the notice of performance being refused.
22. In this context, on perusal of Ex.P.1, the first agreement under which the contract is entered into, it is seen that 3 months time was stipulated for payment of balance of sale consideration and also for getting the sale deed registered and it was made out, time was the essence of that contract. However, within the said period of 3 months, the purchaser paid the entire balance of sale consideration in pursuance of which second agreement is executed as the regular sale deed would not have been registered as on the said date in view of the restrictions imposed under the Act.
23. The said stipulation in the second agreement of sale deed dated 15.11.1989 reads as hereunder: RFA No.896/2003 22
"¸ÀévÀÄÛ jf¸ÀÖgï ªÀiÁr¹PÉÆqÀ®Ä ¸ÀPÁðgÀzÀ DzÉñÀ«®èzÉ EgÀĪÀ PÁgÀt ¸ÀévÀÄÛ F ¢£ÀªÉà ¤ªÀÄä ¸Àħ¢ðUÉ ©lÄÖ F CVæªÉÄAn£À ªÀÄƮ̸ÀA¥ÀÆtð C¢üPÁgÀ PÉÆnÖgÀÄvÉÛãÉ. ¸ÀPÁðgÀzÀ DzÉñÀ §AzÀ vÀPÀët «²µÀÖ PÀZÀÄðUÀ¼ÉÆA¢UÉ ¤ÃªÀÅ w½¹zÀ°è £Á£ÀÄ ©£ï vÀPÀgÁgÀÄ ¥Àr¸ÀzÉà µÉqÀÆå¯ï ¸ÀévÀÄÛ jf¸ÀÖgÀÄ ªÀiÁr¹PÉÆqÀĪÀ ºÀPÀÄÌ «£ÀºÁ ¸ÀéwÛ£À AiÀiÁªÀ «zsÀªÁzÀ ºÀPÀÄÌ ¨ÁzsÀåvÉUÀ½gÀĪÀÅ¢¯Áè."
24. Besides, the said clause, there is also a further condition stipulated which reads as hereunder:
"MAzÀÄ ªÉÃ¼É DzÉñÀ §AzÀÄ £Á£ÀÄ ¸ÀévÀÄÛ jf¸ÀÖgï ªÀiÁr¹PÉÆqÀ®Ä £À¤ßAzÀ ¤ªÀÄUÉ vÀAmÉ vÀPÀgÁgÀÄ §AzÀ°è DUÉÎ ¤ÃªÀÅ EzÉà PÀArõÀ£ïUÉ gÀÆ°ì£À ¥ÀæPÁgÀ ¥É£Á°Ö PÀnÖ £À¤ßAzÀ §¯ÁvÁÌgÀªÁV PÀæAiÀÄzÀ µÉqÀÆå¯ï ¸ÀévÀÛ£ÀÄß jf¸Àégï ªÀiÁr¹PÉƼÀî®Ä ¤ªÀÄUÉ F CVæªÉÄAmï£À ªÀÄÆ®Ì ¸ÀA¥ÀÆtð C¢üPÁgÀ PÉÆnÖgÀÄvÉÛãÉ."
25. With regard to the said stipulation in the agreement, the learned Counsel for the appellant contended that the said restriction was in view of the prevention of fragmentation of lands under the Act which was then prevailing. In the circumstances, as on the date of repealing of the said enactment, the time RFA No.896/2003 23 begins to run and as already submitted, the suit ought to have been filed on or before 2.2.1994, but, the suit is filed in the year 1995 and as such, the suit is barred by limitation.
26. In that regard, the learned Counsel for respondent No.1 herein submitted that the said condition imposed in the agreement is with regard to an uncertain event and as such, it has to be construed that the time was not at all the essence of the contract. If at all if such an uncertain event has become certain, then also it does not change the character of the agreement which discloses that the time was not at all the essence of the contract and hence, the limitation begins to run under Part-II of Article 54 of the Limitation Act i.e., from the time when the plaintiff gets notice of refusal to register the sale deed by the defendant and thus the suit was well within time and hence, the suit is not barred by limitation.
RFA No.896/200324
27. Admittedly as on the date of second agreement of sale as on 15.11.1989, the said 'Act' was very much in force and likewise the property sought to be conveyed fell within the provisions of said Act as it was only 32 guntas of land which was the subject matter. In the circumstances, as on the said date, the words used in the agreement that a direction has to be obtained from the Government means the direction to be received under the said Act. In this context, it is relevant to extract Section 5(b) of the KPFCH Act which reads as hereunder:
"5. Sale, lease, etc.----(1)(a) No person shall sell any fragment in respect of which a notice has been given under sub-section (2) of Section 4, except in accordance with the provisions of clause (b).
(b) Subject to the provisions of Sections 39 and 80 of the Karntaka Land Reforms Act, 1961 (Karnataka Act 10 of 1962), whenever a fragment is proposed to be sold, the owner thereof shall sell it to the owner of a contiguous survey number or recognized sub-division of a survey number (hereinafter referred to as the contiguous owner). If the fragment cannot be sold to the contiguous RFA No.896/2003 25 owner for any reason, the owner of the fragment shall intimate in the prescribed form, the reasons therefor along with an affidavit in support thereof to the Tahsildar and also send copies of such intimation and affidavit to the Sub-Registrar, in the prescribed manner and may thereafter sell such fragment to any other person".
28. Thus though the KPFCH Act was meant to consolidate the small holdings, it also provided for conveyance of such lesser holdings by granting permission under Section 5(b) of the KPFCH Act. As the things stood thus, as on that date, the words 'direction from the Government' clearly refers to the permission to be obtained under the KPFCH Act and nothing more.
29. On perusal of the said provision of law, it is also clear that the permission to sell the small holding could be obtained by a person and as such, it cannot be said that such a condition stipulated under Ex.P.2 is an uncertain event. In other words, the condition so stipulated for execution of the sale deed is a condition which was certain to happen.
RFA No.896/200326
30. Further it is to be seen that in the said agreement of sale, a clause is incorporated stating that even after obtaining such permission/direction, if the vendor refused to execute the sale deed, the purchaser is at liberty to enforce it in accordance with law. Thus in the said circumstances, it is seen that on obtaining the permission, the date of obtaining of permission from the Government is the date fixed for execution of the sale deed and the time begins to run for computation of the limitation on the day on which permission will be obtained by the vendor.
31. Admittedly no such permission was obtained by the vendor and on the other hand the KPFCH Act itself came to be repealed on 02.02.1991 i.e., after about one year 3 months of execution of the agreement of sale. Thus it is seen that as on 02.02.1991, the embargo for registration of the sale deed was wiped off which in RFA No.896/2003 27 other words means that the vendor got the permission to execute the sale deed.
32. Thus the repealing of the enactment of the KPFCH Act itself vests the vendor with liberty to execute the sale deed itself and there is no more clauses to be fulfilled by the vendor to execute the same. Thus it has to be construed that the time begins to run as on the date of repealing of the enactment more so as there is a specific condition stipulated that if on such permission the vendor refuses to execute the sale deed, 'the purchaser is at liberty to enforce it'. Hence though the agreement of sale does not refer to any calendar date by fixing any fixed time for enforcement of the agreement, the recitals in the agreement by itself are sufficient to hold that the happening of the future event reserves liberty to the vendor to execute the sale deed and the same is the date fixed for execution. Though the learned Counsel for the appellant in this context relied RFA No.896/2003 28 upon the judgment reported in the case of H.M. KRISHNA REDDY -vs- H.C. NARAYANA REDDY [2001(5) KLJ 204] even the respondents' Counsel relied upon the same to substantiate his contention that the clause stipulated in the agreement was an uncertain event and as such, the case falls within Part-II of Article 54 of the Limitation Act and in the said decision it is held as hereunder:
"(A) LIMITATION ACT,1963, Article 54 -
Agreement of sale suit for specific performance of - limitation-"Date fixed for performance"- Phrase of refers not only to calendar date fixed expressly by parties, but also to date fixed with reference to future event which is certain to happen on principle of "certum est quod certum redid potest"-
Where subject-matter of sale agreed upon is fragmented agricultural land and agreement contemplates execution of sale deed after repeal of existing statute which prohibits such sale, it is to be held that no date is fixed, as repeal of existing law cannot be taken as future event which event which is certain to happen even though law came to be repealed subsequently-Time of three years for bringing suit for performance of contract, therefore, begins to run against party seeking performance of contract only from date when he had knowledge of other party's refusal to RFA No.896/2003 29 perform-Suit filed within three years from date of notice demanding execution of sale deed, which was not favourably responded to other party, held, is not barred by limitation."
The parties at the time of entering into the "Agreement of sale" must contemplate a future event, which must be certain to happen. In other words, when they want to "Fix the date of performance" in the "Agreement of sale" without reference to a "Calendar date", the agreement must mention the nature and description of future event, which according to the knowledge of the parties or "Common Knowledge" is "Certain to Happen". If the 'Event' state in the agreement, according to the knowledge of parties, or according to 'Common Knowledge' is of such a nature, it "May or "May not"
happen, then it cannot be said the parties contemplated a "date" with reference to a "future event" from which event the performance becomes due (As limitation being a Rule of Technicality which has the effect of barring a Remedy) in the mind of the parties, "fixing the date" for performance of contract. Mere mentioning of any 'Event', which was never contemplated "Certain to happen"
cannot have the effect of "fixing a date" for performance. The period of limitation for filing a suit to enforce an "Agreement of sale" is 3 years under Article 54 of the Limitation Act, 1963, if the agreement of sale provides or fixes a 'date', for performance of the contract. 'Time begins to run from the said date'. The date need not necessarily be the 'calendar RFA No.896/2003 30 date'. It also includes a 'date' referable to 'happening of certain future event'. But if the happening of the 'event', on which depends the performing of the contract is 'uncertain' then it cannot be said to be a 'date fixed' within the meaning of the first clause of Article 54 of the Limitation Act. In which event, it is the latter part of Article 54 which applies i.e., limitation of three years begins to run from the date when the plaintiff has notice of the defendant refusing to perform the contract... In the agreement of sale the clause regarding limitation, defendant should execute a sale deed "After repealing ban on registration by Government". What the parties meant by this clause, no extrinsic or intrinsic evidence is available on record. But the argument is that it should be construed as repealing of the Fragmentation Act, which was in force during the period the 'Agreement of sale was executed'.. This Fragmentation Act was not a transitory piece of legislation; nor there was anything to indicate that this Act was executed as purely a temporary measure. Therefore, the repealing of such a statute which was passed in 1966, cannot be said to be an 'event certain to happen',for purposes of fixing the starting date of limitation. Besides, it is also necessary to note, the Fragmentation Act did not totally prohibit 'sales'. It was permissible to purchase, with the permission of the designated authorities under the Act, Therefore, the agreement of sale, did not fix a date for performance of the contract, nor mentioned an event, 'certain to happen' on the happening of which specific performance RFA No.896/2003 31 became due. Therefore, in this case, the later part of Article 54 applies i.e., time begins to run only when the plaintiff had knowledge of the defendant's refusal to perform...... According to the plaintiff, he came to know of the refusal to perform by the defendant only when his notice dated 28.10.1993 was not responded favourably and the suit is filed within three years from the said date. This factual situation is not in dispute......Therefore, the suit is well-within the time."
33. The facts and circumstances of the said case and in the instant case are totally different in as much as in the agreement of sale, which was the subject matter of the reported decision there is a specific clause with regard to repealment of the enactment itself whereas in the instant case, Ex.P.2 the agreement of sale does not contemplate any such covenant of repealment of the Act itself. On the other hand it states about the direction to be obtained from the Government which was very much within Section 5 of the KPFCH Act.
34. Further it is to be seen that the purchaser had paid the entire sale consideration and if at all, if to RFA No.896/2003 32 his knowledge, such a future event was an uncertain event, he would not have parted with the said sale consideration in toto. The very act on the part of the purchaser in paying the entire amount of sale consideration presupposes that it was not only the vendor, but, even the purchaser was certain that the required permission would be granted and as such, with the common knowledge of both parties that such a thing is happening in future, such a condition is stipulated in the agreement. Hence, the said decision is of no avail to respondent No.1.
35. Further, according to the averments in the plaint at para-6, it is specifically alleged by the plaintiff that the defendant was earlier stating that the permission from the Government was required. Even on repeated approach of the plaintiff, the first defendant was assuring him that, he would execute the sale deed after some time as the permission needed is not yet RFA No.896/2003 33 granted. Thus it is nobody's case that they were contemplating repealment of the enactment but the trial Court has wrongly construed the repealment of the KPFCH Act,
36. In this regard, the trial Court has observed that after repealment of the KPFCH Act, the plaintiff requested the defendant to execute the sale deed but the defendant informed him that there is no partition amongst himself and his brothers and father and as such it was not possible to execute the sale deed. Thereafter after the death of the father of the defendant, the plaintiff requested him to execute the sale deed, but, he refused, then he got issued a legal notice and thereafter he instituted the suit. In this regard it is to be seen that the said aspect of issuance of legal notice etc., is not correct as even according to the plaintiff, it is only a few days prior to the filing the suit, he took notice of the defendant for avoiding/refusing to execute the RFA No.896/2003 34 sale deed. Even otherwise it is seen that the reasoning given by the trial Court is not proper as repeated demands after repealment of the KPFCH Act does not give rise for fresh date of cause of action to the plaintiff and the basis would be repealment of the KPFCH Act itself. The trial Court has further erred in observing that as since repealment of the enactment, the plaintiff has filed the suit for enforcement of the said demand and as such the suit is well within time. Thus on the repealment of the KPFCH Act on 02.02.1991, the time begins to run for computing the period of limitation of 3 years and if that be so, the plaintiff ought to have filed the suit on or before 2.2.1994, but, he has filed the suit on 23.1.1995. Hence, the suit, which is filed beyond 3 years, is clearly barred by limitation and the same is liable to be dismissed accordingly. Hence, the following:
RFA No.896/200335
ORDER The above appeal is allowed; The judgment and decree dated 7th March 2003 passed in O.S.No.51/1995 by the Principal Civil Judge (Sr. Dn.), Bangalore Rural District, Bangalore are hereby set-aside consequent of which the suit of the plaintiff viz., OS 51/1995 is hereby dismissed.
Parties to bear their own costs.
Sd/-
JUDGE Nsu/VMB