IN THE HIGH COURT OF DELHI AT NEW DELHI
Navin Chawla, J.
Microtek Leasing And Finance Pvt. Ltd. – Appellant
Versus
Nisha Chhikara – Respondent
CS(OS) 318 of 2020
Decided On : 20-03-2023
Limitation - Specific Performance of Agreement to Sell - Code of Civil Procedure, 1908 - [LIMITATION] - [SPECIFIC PERFORMANCE] - [Article 54 of the Limitation Act, 1963], [Order VII Rule 11 of the CPC]
Fact of the Case:
The plaintiff filed a suit for Specific Performance of an Agreement to Sell dated 17.01.2015 for a share of agricultural land. The defendant filed an application under Order VII Rule 11 of the CPC, claiming that the suit was barred by the law of limitation.
Finding of the Court:
The court found that the suit was clearly barred by the law of limitation as per Article 54 of the Limitation Act, 1963. The plaintiff failed to demonstrate any agreement for extension of time for completing the sale transactions. The court rejected the plaint under Order VII Rule 11 (d) of the CPC and dismissed the suit and pending application as being barred by limitation.
Issues: The main issue was whether the suit for Specific Performance of the Agreement to Sell was barred by the law of limitation.
Ratio Decidendi: The court applied Article 54 of the Limitation Act, which prescribes a period of three years for filing a suit for Specific Performance of a contract from the date fixed for performance. The court found that the plaintiff failed to demonstrate any agreement for extension of time for completing the sale transactions, and the suit was clearly barred by the law of limitation.
Final Decision: The court rejected the plaint under Order VII Rule 11 (d) of the CPC and dismissed the suit and pending application as being barred by limitation.
JUDGMENT
I.A. 13371/2022
1. This application has been filed by the defendant under Order VII Rule 11 of the Code of Civil Procedure, 1908 (hereinafter referred to as `the CPC') praying for rejection of the plaint on the ground of the suit being barred by the law of limitation.
2. The present suit has been filed by the plaintiff praying for a decree of Specific Performance of the Agreement to Sell dated 17.01.2015 and receipt dated 17.01.2015 in respect of the suit land being 1/8th share of agriculture land measuring 142 bigha (i.e. 335 biswas (16 Bigha and 15 biswas)], out of Khasra Nos.32//14(0-19), 15(4-4), 16(1-17), 25(0-7), 26(0-1),33//11(4-16), 19(6-12), 20(4-8), 21 (3-6), 40//7(2-13), 13(4-16). 14(4-13). 15(1-10), 64//25(5-1 0). 63//21 (4-8), 70//24/1 (0-6), 71//4(3-13), 5(4-16), 7(6-5). 72//1(4-16), 72//2/1 (2-0), 75//23(4-16), 24(4-16), 78//20(2-13), 79//3(4-16), 4(4-16), 7(4-16), 8(4-16), 13(4-16), 14(4-16), 16(4-16), 17(4-16), 18(4-16), 40//4/1(1-17), 40//8/2(4-0), 40//9/2(1-0) situated in the Revenue Estate of Village Dariyapur Kalan, Delhi-110039 (hereinafter referred to as the `suit land').
3. In the suit, it is the case of the plaintiff that in the month of October 2014, Shri Jagpal Chikara, the husband of the defendant, approached Shri Om Prakash Gupta, the Director of the plaintiff, for a loan of Rs.2,24,00,000/- in favour of his wife, the defendant herein. As Shri Chikara was having good relations with Shri Gupta, a loan was provided to the defendant on an assurance that the same shall be returned within a period of three months from the date of its disbursal. The plaintiff claims that the loan amount was disbursed in the name of the defendant vide cheques dated 24.10.2014 for a sum of Rs.80,00,000/-; cheque dated 25.10.2014 for a sum of Rs.85,00,000/-; and through RTGS on 25.10.2014 for a sum of Rs.59,00,000/-.
4. The plaintiff claims that the defendant returned only a sum of Rs.14,00,000/- of the loan amount on 05.11.2014, thereby leaving a balance of Rs.2,10,00,000/-.
5. It is further claimed that in January 2015, Shri Chikara approached Shri Gupta and expressed his inability to repay the said loan. He offered that in lieu thereof, the suit land be purchased by the plaintiff. Accordingly, to maintain a good relationship, the offer was accepted, and after due negotiations, the plaintiff entered into an Agreement to Sell dated 17.01.2015 with the defendant whereunder, the defendant agreed to sell the suit land to the plaintiff. The sale consideration was agreed at Rs.2,51,45,833/-, out of which a sum of Rs.2,10,00,000/- was already received by the defendant, thereby leaving a balance of an amount of only Rs.41,45,833/-, which was to be paid by the plaintiff to the defendant at the time of the execution of the Sale Deed. The said Agreement to Sell duly records that a sum of Rs.2,10,00,000/- has already been received by the defendant and a receipt dated 17.01.2015 for the said amount was also signed by the defendant acknowledging the receipt of the said amount.
6. The plaintiff further states that in terms of the Agreement to Sell, the defendant was to apply for a No Objection Certificate (in short, `NOC') from the concerned Tehsildar (Notification), Revenue Authorities, which was a mandatory requirement before the execution of the Sale Deed. In the Agreement to Sell, it was further agreed that the defendant shall intimate the plaintiff about the receipt of the NOC fifteen days in advance before the date of the registration of the Sale Deed for the suit land in favour of the plaintiff.
7. It is averred in the plaint that Shri Chikara approached the plaintiff in the month of December 2015 and asked for signatures of the plaintiff on the application for the grant of the NOC. The same was duly signed by Shri Gupta. Shri Chikara assured Shri Gupta that the NOC shall be immediately applied for before the Revenue Authorities and the same would be available in about a month's time from the date of the filing of
The main legal point established in the judgment is that the suit for Specific Performance of an Agreement to Sell was clearly barred by the law of limitation as per Article 54 of the Limitation Act,....
In cases of specific performance where no time for performance is fixed in the agreement, the limitation period begins when the plaintiff notices refusal of performance, and the issue of limitation i....
Contractual obligations in specific performance suits require timely action; failure to act within statutory limitation renders claims void.
Suit for Specific Performance – Unlimited limitation would lead to a sense of insecurity and uncertainty.
The main legal point established in the judgment is that the time for specific performance of a contract starts to run after the expiry of the time fixed in the agreement, as per the provisions of Ar....
The issue of limitation for specific performance of a contract is a mixed question of fact and law, and the plaint cannot be rejected solely based on the averments in the plaint.
The court reaffirmed that suits for specific performance must be filed within the limitation period, and failure to do so results in dismissal.
Court emphasized the impact of pandemic-related extensions on limitation periods, affirming that the suit, filed within the extended timeframe, was not barred by limitation.
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.