2017 Supreme(Del) 198
IN THE HIGH COURT OF DELHI AT NEW DELHI
DEEPA SHARMA, J.
ADISHWAR KUMAR JAIN – Plaintiff
Versus
SARITA GUPTA – Defendant
CS (OS) No. 283 of 2013 & I.A. No. 2466 of 2013
Decided On : 23-01-2017
For the Plaintiffs : Mr. Raman Kapur with Mr. Dhiraj Sachdeva.
For the Defendants : Mr. Pradeep Dewan with Mr. O.P. Verma and Ms. Anupam Dhingra.
The cause of action for filing a suit for specific performance arises as soon as one party to the agreement refuses to honor the terms of the contract or from its conduct such an intention can be inferred.
Headnote:
Specific Performance - Barred Suit - Order 2 Rule 2 CPC - [Order 2 Rule 2] - The court discussed the provisions of Order 2 Rule 2 CPC and its application to the case. It highlighted the requirement for the plaintiff to include the whole of their claim on a particular cause of action and the prohibition on suing for a portion of the claim that has been omitted or relinquished. The court emphasized that the cause of action for filing a suit for specific performance arises as soon as one party to the agreement refuses to honor the terms of the contract or from its conduct such an intention can be inferred. It also referenced the findings in the cases of Inbasegaran and Virgo Industries to support its decision.
Fact of the Case:
The plaintiff filed a suit for specific performance, claiming that the defendant failed to honor the terms of the agreement to sell a piece of agricultural land. The plaintiff alleged that the defendant did not obtain the necessary permission and continued postponing the matter, demanded an exorbitant amount, and threatened to create a third party interest in the property. The plaintiff had earlier filed a suit for injunction but withdrew it and subsequently filed the present suit.
Finding of the Court:
The court found that the cause of action for specific performance had arisen when the defendant allegedly failed to honor the agreement to sell. It held that the plaintiff's plea that the cause of action for filing a suit for specific performance could not have arisen before the last date of performance had no merit. The court also referred to the findings in the cases of Inbasegaran and Virgo Industries to support its decision.
Issues: The main issue was whether the claim for specific performance of the agreement to sell was available to the plaintiff at the time when he filed the earlier suit for injunction.
Ratio Decidendi: The cause of action for filing a suit for specific performance arises as soon as one party to the agreement refuses to honor the terms of the contract or from its conduct such an intention can be inferred. The court also emphasized the provisions of Order 2 Rule 2 CPC and the requirement for the plaintiff to include the whole of their claim on a particular cause of action.
Final Decision: The court held that the present suit for specific performance was barred under the provision of Order 2 Rule 2 CPC and rejected the suit.
DEEPA SHARMA, J.
1. This Court had framed the issues in this case on 03.09.2013 and issue No. 3 i.e. "Whether Suit is barred under Order 2 Rule 2 CPC? OPD" was treated as preliminary issue.
2. Accordingly, arguments of the parties are heard on this issue.
3. It is argued by the learned counsel for the plaintiff that he could not have filed the suit for specific performance because the last date of performance of the agreement was 15.01.2013 and that there was no repudiation of the contract by the defendant. In support of his contention, he has relied on the case of Inbasegaran and Another vs. S. Natarajan (Dead) through LRs. 2014 XII A.D. (SC) 420 and it is argued that in this case, the Court had held that the subsequent suit for specific performance was maintainable even though the plaintiff had earlier filed a suit for injunction only. It is further argued that the suit for specific performance could not have been filed earlier because the defendant in her letter dated 05.01.2013 extended the time of performance of the agreement by giving plaintiff three more days for the payment of balance money by way of Demand Draft/Pay order.
4. Learned counsel for the defendant has argued that in view of the fact that the plaintiff has himself pleaded in several paragraphs in his earlier suit as well as in the present suit that the defendant has failed to perform her part of the contract, it amounts to repudiation of the contract by the defendant and that simply because the last date of performance of the agreement was 15.01.2013, it does not postpone the date on which the cause of action to sue for breach of the contract/seek performance of the Contract had arisen. Even the fact that the same cause of action had arisen on other dates and time, does not give rise to a fresh cause of action, it is the continuation of the cause of action which had already arisen and since it had arisen on the date when the plaintiff alleges that defendant had failed to honour the Contract, the cause of action to sue for specific performance of the said contract was already there at the time when the first suit was filed by the plaintiff. It is also argued that although now the plaintiff argues that the period of performance of the Contract was extended by the defendant vide letter dated 05.01.2013, however, in para 5 of his replication, has categorically denied having received the letter of defendant dated 05.01.2013. It is further submitted that the plaintiff who had all along been defaulting in making the payment and thus not complying with the terms and conditions of the agreement and even chosen not to claim specific performance while filing the earlier suit for injunction and he cannot be allowed to file a fresh suit and this suit is liable to be rejected under Order 2 Rule 2 CPC. Reliance is placed on the findings in the case of Virgo Industries (Eng) Private Limited vs. Venturetech Solutions Private Limited, (2013) 1 SCC 625 and it is submitted that the facts of that case are similar to that of this case. It is submitted that in that case also, the agreement to sell were entered into between the parties. The plaintiff in that case filed two suits no. CS (OS) Nos. 831 and 833 of 2005 before the Madras High Court seeking a decree of permanent injunction and restraining the defendant from alienating the property to create any third party interest on the plea that the defendant wanted to frustrate the agreements to sell and had no intention to honour the said agreements. Thereafter, the plaintiff also filed two OS Nos. 202 and 203 on 29.05.2007 for specific performance of the agreement to sell and seeking a decree against the defendant for execution and registration of the sale deeds in respect of the suit properties. In that case also, the defendant took the plea that the suit for specific performance was not maintainable under Order 2 Rule 2 CPC and the plaintiff took the plea that at the time when the suit for injunction was filed, the suit fo