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2025 Supreme(Kar) 362

IN THE HIGH COURT OF KARNATAKA AT BENGALURU
R. Devdas, J.
M/S Akshay Enterprises And Ors. - Petitioners
Versus
Salarpuria Hi Rise Pvt Ltd. and ors. - Respondents
C.R.P NO. 24 OF 2025
Decided On : 13-06-2025

Advocates:
Advocate Appeared:
For the Petitioner:Sri. Dhyan Chinnappa, Sr. Counsel For Sri. Sundara Raman M.V., Advocate
For the Respondent:Sri. K.G.Raghavan & Sri. G.L.Vishwanath., Sr. Counsel For Sri. Badri Vishal., Advocate

Timeliness for specific performance claims is determined by the parties' conduct, not merely fixed contractual deadlines, enabling a nuanced evaluation of obligations.

Headnote:(A) Code of Civil Procedure, 1908 - Order VII Rule 11 - Arbitration and Conciliation Act, 1996 - Section 11(6) - Revision Petition regarding dismissal of interlocutory application by trial court - Court emphasized that limitation for specific performance is dictated by the conduct of the parties and not merely fixed timelines in agreements. (Paras 3, 6, 9)

(B) Limitation - The period for initiating a suit for specific performance commences when the plaintiff is aware of non-performance, not merely on the expiration of the stipulated time. (Paras 6, 10)

Facts of the case:
Defendant No.1 filed a revision against the trial court's dismissal of their application to reject the plaint, arguing that the claims were barred by limitation and that the MoU did not establish enforceable obligations. Plaintiff contended that legal notices and conduct indicated ongoing obligations.

Findings of Court:
The Court ruled that the trial court correctly identified the necessity of weighing evidence regarding limitations and obligations under the MoU rather than relying solely on the MoU's time stipulation.

Issues: Whether claims were barred by limitation and if the conduct of the parties justified any extension of time under the contract.

Ratio Decidendi: The Court confirmed that limitations in specific performance are assessed by the actions and agreements of the parties over time, and not strictly by written confirmations of extensions.

Result: Civil Revision Petition dismissed.

Table of Content
1. details of the civil revision petition and prior proceedings. (Para 1 , 2)
2. discussion of obligations under the mou and limitations. (Para 3 , 4 , 5)
3. arguments regarding acknowledgment of timeline for performance. (Para 6 , 9)
4. court's analysis of evidence and timeline disputes. (Para 7 , 8)
5. final determination of petition dismissal. (Para 10 , 11)

ORDER :

R. Devdas, J.

This Civil Revision Petition is filed by defendant No.1 before the Trial Court, aggrieved of the impugned order dated 20.12.2024, whereby the interlocutory application filed by defendant No.1 under Order VII Rule 11 of CPC was rejected by the trial court.

2. For the sake of convenience, the parties shall be referred to in terms of their ranking before the trial court.

3. Learned Senior Counsel Sri Dhyan Chinnappa, appearing for defendant No.1 submitted that this Court had an occasion to consider a similar matter between the parties in CMP No.75/2020 , where similar such MoU was entered into between the parties on 04.02.2011 (in the present case the MoU is dated 14.02.2011) in respect of different set of lands. As in the present case, there too a legal notice was got issued by the plaintiff on 13.11.2019 calling upon the defendant to specifically perform and complete all obligations under the MoU, failing which the defendant was called upon to refund the amount deposited by the plaintiff under the MoU, along with interest. In the present case, legal notice was issued by the plaintiff on 18.09.2019 and the 1st defendant issued a reply on 03.10.2019 denying any obligation of specific performance arising out of the MoU, while contending that said MoU does not create any legal obligation on the 1st defendant. It was also clearly contended that the claims of the plaintiff are barred by limitation. However, in the other case, since an arbitration clause was contained in the said MoU, the plaintiff herein had to approach this Court by filing a Civil Miscellaneous Petition invoking Section 11 (6) of the Arbitration and Conciliation Act, 1996, for appointment of an Arbitral Tribunal to adjudicate the disputes arising out of MoU dated 14.02.2011. This Court has held that the plaintiff-Company is guilty of waiting for an unreasonably long time to initiate action against the defendant. It was noticed that not a scrap of paper is available on record to show that the parties had mutually agreed to extend the time for completion of the contract. In view of the time fixed therein i.e., three months to procure the lands and get the scheduled lands converted from agricultural to non- agricultural purposes, this Court held that after lapse of three months, no efforts were made by the plaintiff- Company to seek repayment of the advance amount. Accordingly, having come to the conclusion that it is a clear case of ‘deadwood’, the CMP was dismissed.

4. The learned Senior Counsel would further contend that in para 10 of the plaint, it is contended by the plaintiff that the 1st defendant sought confirmation from the plaintiff that it would obtain ‘B’ katha at its cost and in order to obtain ‘A’ katha for each parcel of land and thereafter the kathas could be clubbed together and that the plaintiff would have to bear the costs. However, it is contended by the plaintiff that it declined to accept the request made by the 1st defendant. Attention of this Court is also drawn to para 11 of the plaint where it is clearly stated that although the MoU stipulated the 1st defendant to acquire ownership and get the lands converted within three months from the date of the MoU, there was no sign of the 1st defendant complying with the said requirement. However, details of the items of the schedule properties where agreements of sale were obtained by the 1st defendant with the owners are given in a tabular column in paragraph 11 while also stating that the 1st defendant got a sale deed dated 17.11.2014 executed from the owners in respect of one item of property. It is averred in th

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