Gujarat High Court
Somabhai Kanjibhai Patel vs Abbasbhai Jafarbhai Daginawala And ... on 16 June, 1993
Equivalent citations: (1993)2GLR1337, 1995 A I H C 1402, (1993) 3 CURCC 461, (1993) 2 GUJ LR 1337, (1994) 1 CIVILCOURTC 95, (1993) 2 GUJ LH 143
JUDGMENT A.N. Divecha, J.
1. The judgment and the decree passed by the learned Joint Civil Judge (S.D.) at Surat on 3rd November, 1977 in Special Civil Suit No. 207 of 1975 are under challenge in this First Appeal at the instance of the original plaintiff under Section 96 of the Code of Civil Procedure, 1908 ('the Act' for brief). It needs no telling that the appellant's suit has come to be dismissed thereunder.
2. The facts giving rise to this appeal are not many and not much in dispute. One Dawoodbhai Jafarbhai Daginawala (the deceased for the sake. of convenience) was a Partner in the Partnership Firm in the name and style of Johar Estate Corporation (the Partnership Firm for convenience) along with respondents Nos. 1, 2 and 4 herein. The Partnership Firm was dealing in lands. The appellant claims to have agreed to purchase plots Nos. 8 to 14 from Survey Nos. 276/1 and 277/1 situated in Udhna from the Partnership Firm on the consideration amount of Rs. 8,000. He is stated to have paid the entire consideration on 31st March, 1970 under the receipt at Exh. 49 on the record of the trial Court. It appears that the deceased breathed his last some time in 1973. It appears that plots Nos. 9 and 12 were sold by the deceased during his life time some time in or around July 1972 and May 1973 respectively. Plots Nos. 8, 13 and 14 were sold by his heirs and legal representatives some time in or around December 1973 obviously after his death. It was the case of the appellant before the lower Court that he entered into a fresh agreement with the existing partners of the Partnership Firm for sale of plots Nos. 33 to 39 in lieu of plots Nos. 8 to 14 agreed to be sold earlier. According to the appellant, the respondents herein later on backed out from the agreement to sell plots Nos. 33 to 39. Some notice correspondence appears to have been exchanged between the parties. The appellant was thereafter required to file one suit in the Court of the Civil Judge (S.D.) at Surat for specific performance of the contract alleged to have been entered into between the appellant on one hand and the partners of the Partnership Firm on the other for sale of plots Nos. 8 to 14 as originally agreed or in the alternative plots Nos. 33 to 39 as subsequently agreed or in the alternative for compensation and for refund of the Earnest Money together with interest thereon. It came to be registered as Special Civil Suit No. 207 of 1975. Respondents Nos. 1,2 and 4 filed their separate written statement at Exh. 19 on the record of the trial Court and resisted the suit on various grounds. Respondents Nos. 3 and 5 to 7 filed their separate written statement at Exh. 20 on the record of the trial Court and resisted the suit on various grounds practically the same as urged by the other defendants in their written statement at Exh. 19 on the record of the trial Court. The suit appears to have been assigned to the learned Joint Civil Judge (S.D.) at Surat for trial and disposal. On the pleadings of the parties, the necessary issues were framed at Exh. 21 on the record of the trial Court. After recording evidence and hearing the parties, by his judgment and decree passed on 3rd November, 1977 in Special Civil Suit No. 207 of 1975, the learned Joint Civil Judge (S.D.) at Surat dismissed the suit. The aggrieved plaintiff' thereupon invoked the appellate jurisdiction of This Court under Section 96 of the Code for questioning the correctness thereof.
3. The learned trial Judge infer alia came to the conclusion that the appellant entered into a contract for sale of plots Nos. 8 to 14 with the deceased in his individual capacity and not as a partner of the Partnership Firm. The learned trial Judge also came to the conclusion that there was no new contract for sale of plots Nos. 33 to 39 with the Partnership Firm after the death of the deceased. The learned trial Judge however came to the conclusion that the suit was bit by the Law of Limitation both with respect to the relief of specific performance as well as the relief of refund of the Earnest Money.
4. Shri Anjaria for the appellant has submitted that the learned trial Judge was not right in dismissing the suit on the ground that it was barred by the Law of Limitation. As against this, Smt. Bela Yagnik for the respondents has challenged the finding in favour of the appellant recorded by the trial Court to the effect that the deceased orally agreed to sell plots Nos. 8 to 14 to the plaintiff even in his individual capacity. Smt. Yagnik has further urged that the trial Court has rightly dismissed the suit as barred by the Law of Limitation.
5. So far as the relief of specific performance is concerned, the correct Article of the Limitation Act, 1963 ('the Act' for brief) applicable would be Article 54. The learned trial Judge has applied that Article in the present case. It has come on record that plot No. 12 out of plots Nos. 8 to 12 agreed to be sold was sold by the deceased during his life-time on or about 26th July, 1972. In any case, the sale transaction with respect to plot No. 12 was registered under the Indian Registration Act, 1908 on that date as transpiring from a certified copy of the index extract at Exh. 58 on the record of the case, and as such the knowledge of the sale transaction with respect to that plot can certainly be attributed to the appellant from the date of such registration on 26th July, 1972. The suit was admittedly filed on 28th October, 1975, that is, nearly three years and three months after the date of such registration of sale of plot No. 12. I think the learned trial Judge was not right in accepting the date of the receipt at Exh. 49 to be the starting point of limitation under Article 54 of the Act. The prescribed period of limitation under Article 54 of the Act is three years from the date performance of the contract is refused to the knowledge of the litigating party. In that view of the matter, there is no escape from the conclusion that the suit for specific performance was hit by Article 54 of the Act.
6. Shri Anjaria for the appellant has however tried to wriggle out of the rigours of Article 54 of the Act by pressing into service ingenious submission to the effect that the contract was for sale of in all seven plots and sale of one plot therefrom would amount to refusal of performance of the contract in part and it would be open to the litigating party to wait till all the plots or in any case the last plot is sold by the defaulting party. In that case, runs the submission of Shri Anjaria for the appellant, the suit could not be said to be lime-barred as on the date of the suit plots Nos. 10 and 11 were not found to be sold and that the last sale transaction was of 29th December, 1973 as transpiring from the index extract at Exh. 60 with respect to plot No. 8.
7. I think this submission cannot be accepted for the simple reason that the contract was for sale of in all seven plots and sale of one plot would amount to refusal to perform the contract in its entirety. The starting point of limitation would come into play as soon as performance of the contract in its entirety is refused either expressly or by necessary implication evinced by such contract of sale of one plot therefrom. If the starting point of limitation is not allowed to run on the ground of refusal of performance of the contract in part, no suit could be instituted till the performance of the contract in its entirely is refused. In that case, the suit filed before the entire contract is broken might be branded as premature. Besides, the starting point of limitation cannot be permitted to be postponed indefinitely as in the instant case. If the seven plots were sold bay at an interval of three years each, the starting point of limitation would come to be postponed upto say 24 years because the different transactions for seven plots would be spread over for 21 years and three years for the prescribed period of limitation from its starting point. Such interpretation of Article 54 would not be in keeping with the spirit and the object of the Law of Limitation. It will produce some unreasonable result. It is true that provisions of the Act have to be construed strictly so as not to deny the remedy to the litigating party for mere asking. That however does not mean the postponement of the starting point of limitation to an absurd and unreasonable length. On such interpretation of Article 54 of the Act as canvassed before the on behalf of the appellant, in a given case, the starting point of limitation may not at all arise. Suppose seven plots are agreed to be sold and only six plots are sold and the seventh is never sold, the starting point of limitation can be said to have been postponed indefinitely. I do not think that such a result can be allowed to be produced by interpreting Article 54 in the manner canvassed before the by Shri Anjaria for the appellant.
8. The ruling of the Bombay High Court in the case of Shrikrishna Keshav Kulkarni v. Balqji Ganesh Kulkarni buttresses the view I have taken in this case with respect to the starting point of limitation. In that case, the agreement between the parties stipulated sale of two ancestral houses jointly held by two persons and it was stipulated that the sale was to be executed after the attachment brought by the creditors was raised. It was held in that case that there was no fixed time for performance of the contract. The Court came to the conclusion that the starting point of limitation would be from the date the performance of the contract was refused. In that case, it was found that one of the owners of the two houses sold one house under a registered sale deed on 6th February, 1967. That was treated as the starting point of limitation.
9. In the present case the trial Court has rightly come to the conclusion that there was no time fixed for performance of the contract between the parties. In that view of the matter, the starting point of limitation would be the date of sale of the first plot as evidenced by the index extract at Exh. 58 registered on 26th July, 1972. I think the learned Judge was right in branding the appellant's suit as time-barred.
10. The learned trial Judge has not specifically referred to any Article of 4he Act for denying to the plaintiff his remedy of recovery of the Earnest Money as hit by the Law of Limitation. There appears to be no specific Article in the Act prescribing the period of limitation for recovery of the Earnest Money paid for the performance of the contract and it is not performed. The relief of the recovery of the Earnest Money can certainly not be part of Article 54 of the Act. It is restricted to the relief of specific performance only. Article 47 of the Act will not be applicable for the reason that it applies to a suit for money paid for an existing consideration which afterwards fails. In the present case, the consideration cannot be said to have failed afterwards. Since there appears no specific Article in the Act for governing a suit for recovery of the Earnest Money, the residuary Article being Article 113 thereof will have to be resorted to for the purpose.
11. I am supported in this view of mine by the Division Bench ruling of the Delhi High Court in the case of Ram Lai Puri v. Gokalnagar Sugar Mills Co. Ltd. reported in AIR 1967 Delhi 91. In that case also, the contract was for sale of one building in Lahore. The contract could not be performed on account of partition of the country some time in 1947. The Court was approached inter alia for the relief of refund of the Earnest Money. In that context, it has been held by the Delhi High Court that Article 120 of the old Limitation Act, 1908, being a residuary Article, was applicable in such a case. It cannot be gainsaid that Article 120 of the old Act has been inserted as Article 113 in the new Limitation Act of 1963. The starting point of limitation thereunder would be when the right to sue accrued. The right to sue for recovery of the Earnest Money would accrue when performance of the contract was refused by the other side. As aforesaid, performance was refused when registration of sale of plot No. 12 by the deceased took place on 26th July, 1972. As aforesaid, the suit was filed on 28th October, 1975, about three years and three months after the date of registration of the sale transaction of plot No. 12. The prescribed period of limitation under Article 113 of the Act is three years from the date the right to sue accrues. The suit is filed three months after expiry of the period of limitation in the present case. The learned trial Judge has rightly held it to be time-barred even for the relief of recovery of the Earnest Money.
12. In view of my aforesaid discussion, I am of the opinion that the judgment and the decree passed by the lower Court calls for no interference by This Court in this appeal, in this view of the matter, it is not necessary to deal with or dwell upon the submissions urged before the by Smt. Yagnik for the respondents questioning the correctness of the finding recorded by the learned trial Judge with respect to establishment of the oral agreement between the plaintiff and the deceased in his individual capacity.
13. In the result, this appeal fails. It is hereby dismissed however with no order as to costs on the facts and in the circumstances of the case.