The court emphasized the importance of pleading and proving loss in cases of breach of contract and highlighted the entitlement of the buyer for a refund of the price paid.

VALMIKI J. MEHTA, J.

RFA No.113/2006 and C.M. Appl. Nos. 2629-30/2006

1. This Regular First Appeal under Section 96 of the Code of Civil Procedure, 1908 (CPC) is filed by the plaintiff in the suit impugning the judgment of the trial court whereby the trial court has dismissed the suit for specific performance and injunction filed by the appellant/plaintiff. Specific performance was claimed by the appellant/plaintiff with respect to two office spaces bearing nos. H-7 and H-8 having an approximate area of 225 sq. feet each situated in the building constructed on plot no. 1, Rajendra Place, New Delhi, by the respondent/defendant. Trial court has dismissed the suit as being barred by limitation and has therefore given no findings on other issue nos. 2 to 4.

2. At the outset I would like to note that the trial court has observed that it does not have to decide issue nos. 2 to 4 because the suit is held to be barred by limitation as per decision on issue no.1, but this is not a correct approach of the trial court because all issues have to be decided by the trial court in view of Order XIV Rule 2 CPC unless the trial court held that it lacked jurisdiction. There is no issue of lack of jurisdiction of trial court and therefore trial court should not have only decided the issue of limitation and dismissed the suit and the trial court should also have decided issue nos. 2 to 4.

3. The facts of the case are that the appellant/plaintiff filed the subject suit for specific performance with respect to the suit properties pleading existence of two Agreements to Sell dated 17.1.1983 for a total sale consideration of Rs.4,50,000/- i.e. Rs.2,25,000/- for each of the spaces H-7 and H-8. The application which is termed as the Agreements to Sell by the trial court, and dated 17.1.1983, was followed by a proper Agreement to Sell dated 16.3.1983. Appellant/plaintiff has pleaded in the plaint that he regularly waited for receiving intimation with respect to various payments to be made in installments inasmuch as the respondent/defendant was to construct the entire property at 1, Rajendra Place, New Delhi, but ultimately finding no response of the respondent/defendant, the appellant/plaintiff issued his Letters dated 30.12.2003 and 7.3.2004 that the respondent/defendant must receive the balance payment and hand over possession of the suit properties to the appellant/plaintiff, but in spite of the appellant/plaintiff being ready and willing to perform his part of the contract the respondent/defendant did not transfer the suit properties to the appellant/plaintiff and hence the subject suit was filed by the appellant/plaintiff for specific performance and injunction.

4. The respondent/defendant contested the suit and prayed for dismissal of the suit on the ground of being time barred because Agreements were of the year 1983 and the suit was filed on 27.8.2004, i.e. after around 21 years of the Agreements to Sell. Trial court has referred to Article 54 of the Limitation Act, 1963 which provides for three year period of limitation with respect to suit a for specific performance and accordingly trial court has held that there cannot be specific performance of a contract after approximately 18 years. The relevant observations of the trial court with respect to issue of limitation are contained in para 9 of the impugned judgment and this para reads as under:-

“9. Now the controversy exists as to whether the present suit has been filed within a period of limitation or not. Article 54 of Limitation Act, 1963 lays down limitation pertaining to specific performance of a contract which is three years from the date fixed for the performance or, if no such date is fixed, when the plaintiff has noticed that performance is refused. The aforesaid Article of Limitation Act makes it abundantly clear that in a suit for specific performance of contract, limitatio