Limtation act
V.G.Rao Advocate
(Querist) 07 January 2009
This query is : Resolved
Hi all,
There is an agreement of sale dated 25th day of July 2007 entered between owner and purchaser. At the time of agreement purchaser paid certain amount in advance, possession is to be delivered after registration of sale deed,and one of the clause of the said agreement reads as under,
"the remaining balance sale consideration amount will be paid by the purchaser to the owner on or beore 12 months or at the time of registration which ever is earliar and both parties agreed for the same".
Immediate after the date of the agreement of sale, till date the purchaser neither offerd the balance sale consideration to the owner nor shown any interest to get the sale deed registred with the owner, so far no legal notice is issued by the purchaser to show that he is ready and willing to perform his part of contract to register the sale deed in his favor by paying balance sale consideration.
While matter stood thus one "X" person is now intending to purchse the same property with the aforsaid owner by paying at present marke value.
Now my question under the said circumstances 1)whether purchser can maintain a suit for specific performance of agreement of sale dt 12th july 2007?
2)If he files such suit, i want to know whether the said suit will be barred by limitation?
3)can owner now cancell the aforesaid agreemnt of sale by issuing a legal notice to the purchaser?
4)whether owner can enter in to another agreement of sale with "X" at present market value by cancelling the earliar agreemnt of sale?
PALNITKAR V.V.
(Expert) 07 January 2009
The answers are as below.
1 and 2: The purchaser can file suit for specific performance. Whether the suit is barred by limitation(Limitation in the agreement) would depend upon the question whether the time was essence of the contract. If the parties intended to treat the time as essence of the contract, the suit would fail for failure of the purchaser in payment of the balance within the stipulated time.
3. The seller can terminate the agreement by issuing notice.
4. The owner can enter into another agreement if the agreement stands cancelled in the circumstances quoted earlier.
V.G.Rao Advocate
(Querist) 07 January 2009
Thanx Mr.Palnitkarji, but
My question is, on the face of the said agreement, whether the agreement dt 12th day July 2007 is barred by limitation in view of the afore referred clause in the agreement?
PALNITKAR V.V.
(Expert) 07 January 2009
The short description does not show that time was essence of the contract. Normally, in the case of immovable property, time is not presumed to be essence of the contract unless the property has commercial value which changes very quickly. From the short history, it can not be made out whether the nature of the property is such that it can be presumed that the time was essence of the contract. Hence, the agreement does not seem to be barred by limitation.
V.G.Rao Advocate
(Querist) 07 January 2009
Mr.Palnitkarji Once again thanx for giving valuable answer, though it seems convincing from ur point of view, I am expecting any case law which supports your version. In the agreement of sale referred by me, except the aforesaid clause which speaks of time for registration of sale deed, the other clauses are of normal and routine one. For ur information the property is a residential house having the area of around 300 sq.yds situated in comercial area.
Srinivas.B.S.S.T
(Expert) 08 January 2009
Sir, In addition to what Palnitkar Sir opined, I would like to add this clarification.
Article 54 of Limitation Act deals with the limitation aspect with regard to suits for specific performance of contract. As per the said article the period of limitation is 3 years and the time from which period begins to run is " the date fixed for the performance, or, if such no date is fixed, when the Plaintiff has notice that performance is refused"
As such the limitation period in your case can be three years from 25th day of July 2008 (i.e., the date fixed for performance-twelve months from the date of agreement), for the seller to initiate a suit for specific performance against the purchaser or likewise for the purchaser. With regard to the readiness to get or a execute a registered sale deed on either part is an issue to be decided in the trial.
2005 (28) AIC 666 (All. H.C.)
AIR 1982 Kar. 93
AIR 1963 Mad 24
AIR 2004 Ori. 160
Regards Srinivas BSST
Srinivas.B.S.S.T
(Expert) 08 January 2009
Sir, In addition to what Palnitkar Sir opined, I would like to add this clarification.
Article 54 of Limitation Act deals with the limitation aspect with regard to suits for specific performance of contract. As per the said article the period of limitation is 3 years and the time from which period begins to run is " the date fixed for the performance, or, if such no date is fixed, when the Plaintiff has notice that performance is refused"
As such the limitation period in your case can be three years from 25th day of July 2008 (i.e., the date fixed for performance-twelve months from the date of agreement), for the seller to initiate a suit for specific performance against the purchaser or likewise for the purchaser. With regard to the readiness to get or a execute a registered sale deed on either part is an issue to be decided in the trial.
2005 (28) AIC 666 (All. H.C.)
AIR 1982 Kar. 93
AIR 1963 Mad 24
AIR 2004 Ori. 160
Regards Srinivas BSST
PALNITKAR V.V.
(Expert) 08 January 2009
In addition to the reply given by my learned friend, i would like to state that merely because the house situates in the commercial area, it can not be readily inferred that the time was essence of the contract. Please see the following latest ruling of the SC. I hope that will satisfy you.
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Highlight in this judgment
[SUPREME COURT OF INDIA]
Balasaheb Dayandeo Naik (Dead) Through Lrs and Others
v
Appasaheb Dattatraya Pawar
P. Sathasivam
24 Jan 2008
BENCH
Arijit Pasayat & P. Sathasivam
COMPARATIVE CITATIONS
2008 (1) CTC 530, 2008 INDLAW SC 91
CASES REFERRED TO
Swarnam Ramachandran and Another v Aravacode Chakungal
Jayapalan 2004 Indlaw SC 659
Vairavan v K.S. Vidyanadam 1997 Indlaw SC 2551
Chand Rani v Kamal Rani 1992 Indlaw SC 1223
Smt. Indira Kaur and Others v Sheo Lal Kapoor 1988 Indlaw SC
421
Govind Prasad Chaturvedi v Hari Dutt Shastri and Another 1977
Indlaw SC 159
THIS JUDGMENT WAS FOLLOWED IN 2 CASE(S)
CASE NO
Appeal (Civil) 647 of 2008 (Arising Out of Slp (C) No. 16694
of 2005)
EDITOR'S NOTE
Suit for specific performance - High Court set aside the
decree for specific performance granted by the trial Court -
Appeal against - Whether time is the essence of the contract?;
whether the plaintiffs were ready and willing to perform the
contract? - Held, in the case of sale of immoveable property,
there is no presumption as to time being the essence of the
contract - Even where parties have expressly provided that
time is the essence of the contract, such a stipulation will
have to be read along with other provisions of the contract -
Appellants/plaintiffs clearly established their claim to
secure specific performance of the agreement by leading cogent
evidence whereas the respondent/defendant having pleaded that
time was the essence of the contract neither entered the
witness box nor led any evidence whatsoever - High Court
should have confirmed the decree of specific performance
granted by the trial Court - Appeal allowed.
KEYWORDS
Immovable Property, Agreement For Sale, Agreement Of
Sale, Contract Of Sale, Vendor, Presumption, Appeal
allowed, Extension Of Time, Contract, Specific
Performance, CONTRACT & COMMERCIAL, Performance,
Specific Performance Of, Suit For Specific Performance,
PRACTICE & PROCEDURE, Legal Representative, Reasonable
Time, LAND & PROPERTY, Agricultural Land, To Perform,
Immoveable Property, Completion, Specific Performance Of
Contract, Failure, Time Of The Essence
.JUDGMENT TEXT
The Judgment was delivered by : HON'BLE JUSTICE P. SATHASIVAM
1. Leave granted.
2. This appeal is directed against the judgment and order
dated 11.01.2005 passed by the High Court of Judicature at
Bombay in First Appeal No. 743 of 1993 in and by which t
V.G.Rao Advocate
(Querist) 08 January 2009
Thank u Mr.Srinivas BSST jI, and Mr.Palnitkarji,for helping me in prosecuting the case in right way. I thank u once again for all ur efforts.
