A unilateral cancellation of a registered agreement of sale is invalid; the cause of action based on subsequent knowledge and payments keeps the suit within limitation.

ORDER :

M.Nagaprasanna, J.

The petitioners/defendants 1, 2, 4 and 7 are before this Court calling in question an order dated 24-06-2024 passed by the II Additional Senior Civil Judge and J.M.F.C., Nelamangala rejecting I.A.No.III filed by them in O.S.No.608 of 2021 seeking rejection of the plaint.

2. Heard Sri V.B. Shivakumar, learned counsel for the petitioners and Smt. VijayaKumar K, learned counsel appearing for respondent No.1/plaintiff.

3. Facts, in brief, germane are as follows: -

The defendants and the plaintiff have a transaction. The transaction is with regard to purchase of a property. A registered agreement of sale is entered into between the defendants and the plaintiff. Pursuant to registered agreement of sale, the defendants do not come forward to execute the sale deed. The plaintiff then institutes O.S.No.608 of 2021 seeking specific performance of enforcement of contract – registered agreement of sale. The defendants come up with an application under Order VII Rule 11(a), (b) and (d) of the CPC seeking rejection of the plaint on the ground of limitation. The concerned Court, in terms of the impugned order, rejects the application filed by the defendants on the score that the suit filed was well within time and the plaint averments did disclose cause of action.

4. The learned counsel Sri V.B. Shivakumar appearing for the petitioners/defendants would contend that a suit for specific performance is instituted on 22-10-2021 for enforcement of an agreement of sale dated 18-03-2016. If that is taken note of, the suit is instituted only in 2021. Therefore, it is beyond the period of three years from the date of the agreement to sell and the suit for specific performance is barred by limitation. He would submit that the plaint be rejected on this score as the order of the concerned Court is erroneous. He would further contend today the land is acquired by the National Highways Authority. The land is not even in existence. Therefore, no relief of specific performance can be granted to the plaintiff, which is an added contention towards rejection of the plaint.

5. Per contra, the learned counsel representing the 1^st respondent/plaintiff would vehemently refute the submissions in contending that the registered agreement of sale which was entered into between the parties on 18-03-2016 was sought to be cancelled unilaterally by issuing a notice in the year 2019 i.e., on 11-04-2019. The plaintiff has replied to the said notice on 19-04-2019 expressing his readiness and willingness to get the sale deed executed. After the said reply, the defendants have accepted 4 cheques towards sale consideration and the plaintiff as on date paid Rs.1.23 crores. Therefore, the cause of action arose on 2-10-2021 when the plaintiff had come to know that by suppressing the agreement of sale, the defendants were trying to alienate the property in favour of third parties. He would contend that the petition be dismissed.

6. I have given my anxious consideration to the submissions made by the respective learned counsel and have perused the material on record.

7. The afore-narrated facts are a matter of record. The issue that brings the defendants to this Court is rejection of their application filed in O.S.No.608 of 2021 seeking rejection of the plaint. It is, therefore, necessary to notice Order VII Rule 11 CPC. It reads as follows:

“11. Rejection of plaint.—The plaint shall be rejected in the following cases:—

(a) where it does not disclose a cause of action;

(b) where the relief claimed is undervalued, and the plaintiff, on being required by the Court to correct the valuation within a time to be fixed by the Court, fails to do so;

(c) where the relief claimed is properly valued but the plaint is written upon paper insufficiently stamped, and the plaintiff, on being required by the Court to supply the requisite stamp-paper within a time to be fixed by the Court