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High Court of Judicature at Madras
T. RAJA, J.
Radha Lakshmanan
Versus
M.S. Gurusamy
S.A. No. 1303 of 2013
Decided on: 05-11-2014
Indian Contract Act - Section 23 - Transfer of Property Act, 1882 - Section 35 – Dishonor of cheque - Whether respondent is estopped by conduct in pleading that agreement of sale is void because he had entered into said Agreement with full knowledge of its authenticity and with an intention to transfer same absolutely after remitting entire sale consideration to TNHB and hence concept of contra would apply – Condo nation of delay - Plaintiff has entered into a sale agreement with defendant for purchase of a suit property - After executing sale agreement as advance was paid and remaining balance amount was agreed to be paid within three months from date of agreement - It was further claimed by plaintiff appellant that time for performance of agreement was not specified in agreement considering fact that defendant has to pay all installments or pay entire consideration to Housing Board to get sale deed registered in his favor since suit property was allotted to defendant by Housing Board - It has been further claimed by appellant was paid by way of cheque on date of agreement another sum was paid by cheque - One another payment was paid by way of cheque - Again was paid by way of cheque in favor of defendant and yet another sum was paid by way of cheque in favor of defendant and as such a total sum of was paid - While claiming payment of above said amount plaintiff also claimed that he has been in possession of suit property for the last years as on date of filing suit and maintaining property for purpose of construction of a superstructure - It was further complained that defendant did not come forward to take steps to get property registered in his favor from Housing Board by causing delay – Held, In similar and identical circumstances this Court in has held that insofar as limitation is concerned Article 54 of the Limitation Act is very clear in its terms for period of limitation fixed for a suit for specific performance of a contract is three years from date fixed for performance or if no such date is fixed when plaintiff has notice that performance is refused - Admittedly in present case in terms of Article 54 of Limitation Act plaintiff having executed sale mentioning three years time for executing sale agreement and filed suit beyond period prescribed time limit it is beyond period of three years from date fixed for performance of agreement - In view of that suit is barred by limitation - Besides this view gets support from above said judgment mentioned supra wherein it has been held - There is absolutely no whisper in plaint that parties either by express agreement or by implied agreement extended time for performance of contract – Hence by terms of Article 54 of Limitation Act, suit is filed beyond period prescribed therefore – Admittedly it is beyond period of three years from date fixed for performance in agreement – Hence suit is barred by limitation - View taken by Court below that time is not essence of contract and therefore suit is in time is unsustainable - It is one thing to say that time is not essence of contract and it is another thing to say that suit is barred by limitation - In present case suit is governed by Article 54 of Limitation Act and it is barred by limitation - Counsel for appellant contends that provisions of Act will invalidate only a transfer and will not affect an agreement of sale - According to him an agreement is not a transfer and therefore Section does not come into play - Court are unable to accept this argument - Plaintiff seeks to have agreement enforced by a Court of law and get a sale deed in pursuance thereof - If Court grants a decree in favor of plaintiff and it leads to a sale deed in favor of plaintiff either by party or by Court that sale is automatically void and it is deemed to be void always as per provisions of Act - Court cannot be a party to a transaction which would be void in law - Hence there is no substance in contention that agreements are not affected by provisions of Act – Appeal is dismissed
1. The unsuccessful plaintiff whose suit for specific performance to execute and register sale deed in respect of plot No.212 Periyar Nagar, Korattur, Madras, by enforcing the agreement of sale dated 25.09.1993 entered with the defendant having been dismissed, again getting another dismissal from the appellate Court, has brought the appeal.
2. This Court, while entertaining the second appeal, has framed the following 3 substantial questions of law for consideration:
“1. Whether on the admission of the respondent that he had remitted the entire sale consideration for the plot by 11.03.1992 and because of the delay in registration by TNHB in favour of the respondent and his intention to remain in Coimbatore, the agreement of sale dated 25.10.1993 would not fall under the mischief of the prohibition stated under the Lease cum Sale Agreement?
2. Whether the respondent is estopped by conduct in pleading that the agreement of sale dated 25.10.1993 is void because he had entered into the said Agreement with full knowledge of its authenticity and with an intention to transfer the same absolutely after remitting the entire sale consideration to TNHB and hence the concept of contra profendum would apply?
3. Whether the courts below should have held that the entire sale consideration for the purchase of the plot having been remitted to TNHB by the defendant long prior to entering into the Agreement of Sale, the said transaction cannot be termed as speculative in nature to fall within the mischief of Section 23 of the Indian Contract Act.”
3. The brief facts leading to the filing of the present second appeal is given as under:
The plaintiff Mrs.Radha Lakshmanan has entered into a sale agreement with the defendant on 25.10.1993 for purchase of a suit property for a sum of Rs.1,50,000/-. After executing the sale agreement, a sum of Rs.50,000/- as advance was paid and the remaining balance amount of Rs.1 lakh was agreed to be paid within three months from the date of agreement. It was further claimed by the plaintiff/appellant that the time for the performance of agreement was not specified in the agreement considering the fact that the defendant has to pay all the installments or pay the entire consideration to the Tamil Nadu Housing Board to get the sale deed registered in his favour, since the suit property was allotted to the defendant by Tamil Nadu Housing Board. It has been further claimed by the appellant that Rs.50,000/- was paid by way of cheque on 25.10.1993 on the date of agreement, another sum of Rs.50,000/- was paid by cheque on 28.10.1993. One another payment of Rs.1 lakh was paid by way of cheque on 02.02.1994. Again Rs.35,000/- was paid by way of cheque on 02.02.1994 in favour of the defendant and yet another sum of Rs.25,000/- was paid by way of cheque in favour of the defendant on 10.02.1994 and as such a total sum of Rs.2,60,000/- was paid. While claiming the payment of the above said amount, the plaintiff also claimed that he has been in possession of the suit property for the last 13 years as on the date of filing the suit and maintaining the property for the purpose of construction of a superstructure. It was further complained that the defendant did not come forward to take steps to get the property registered in his favour from the Tamil Nadu Housing Board by causing delay of more than 13 years. Again complaining the defendant that in order to defeat the plaintiff, the defendant has been taking urgent steps to get the sale deed registered to third party for more financial gain. Hence, he was constrained to file a suit for specific performance.
4. The defendant opposing the above prayer and pleas taken by the plaintiffs presented a detail written statement. Taking serious objections on the ground that suit schedule property was allotted to the defendant by the Tamil Nadu Housing Board vide allotment order G.O.Ms.No.1345 dated 12.11.1990 for which, the defendant had paid the entire sale consideration to the Tam
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