Agreement to Sell-Where the agreement does not prescribe the date for seeking specific performance, then the limitation should be from the date of notice when performance is refused

Amit Rawal, J.

This order of mine shall dispose of two Regular Second Appeals. RSA bearing No.1477 of 2010 is arising out of decision of civil suit bearing no.756 of 2004 (hereinafter referred to as “suit no.1”) at the instance of the plaintiff seeking permanent injunction which has been dismissed by both the Courts below and RSA bearing No.6351 of 2014, whereby, both the Courts below have decreed the suit bearing no.429 of 2010 (hereinafter referred to as “suit no.2”) for specific performance of the agreement to sell, filed on 08.02.2010.

2. Mr. Arun Jain, learned Senior Counsel assisted by Mr. Mohit Sharma, Advocate appearing on behalf of vendor, namely, Arvind Gulati, submitted that an agreement to sell dated 21.03.2003 in respect of plot measuring 405.94 sq. meter for a total sale consideration of Rs.35 lacs was entered into for the sale of a plot bearing No.S-27/7, DLF Phase III, Gurgaon. In fact, it was realized that the area was little more. Instead of 450, it was 486 and the total sale consideration was increased to Rs.37.86 lacs and against the payment of earnest money of Rs.7 lacs, another Rs.1 lac. was paid.

3. As per the terms and conditions of the agreement to sell, the appellant-vendor had to obtain the sale deed from the DLF and within one month thereafter vendee, Mange Ram and others was required to get the sale deed executed and registered. He further submitted that vendee instituted a suit no.1 on 17.07.2004 on the premise that the vendor had caused an advertisement dated 04.07.2004, in the newspaper to sell a plot in question. He also submitted that in the aforementioned suit, vendee categorically stated this fact. Once there was a breach, no explanation came forth in not filing the suit for specific performance which was filed in February, 2009. In fact, the suit no.2 for specific performance was barred by law of limitation, much less, hit by doctrine akin to Order 2 Rule 2 Code of Civil Procedure (hereinafter referred to as “CPC”). All these aspects have erroneously been ignored by both the Courts below. In fact, the agreement was frustrated as per the provisions of Section 156 of the Contract Act as the agreement to sell is a contingent one. Both the Courts below have erred in not taking into consideration the evidence led by vendee, wherein, he admitted that he had not deposited any charges towards the stamp and had also not prepared any sale deed.

4. He further submitted that in cross examination, there is a categoric admission that after filing the suit for injunction in the year 2004, he had visited the office of DLF only in the year 2005 and had been in touch on telephone with the vendor but had no personal meeting with him. All these facts would reveal plaintiff was not always ready and willing to perform his part of the contract, in essence, there was no compliance of the provisions of Section 16(c) of the Specific Relief Act, 1963 (hereinafter referred to as “1963 Act”), therefore, the discretion under Section 20 of 1963 Act ought not to have been granted and cited judgment rendered by the Hon'ble Supreme Court in M/s Virgo Industries (Eng.) P. Ltd. Vs. M/s Venturetch Solutions P. Ltd. 2012(4) RCR (Civil) 372, to contend that in case, the person has availed the remedy of injunction, though there was a breach, then suit for specific performance filed after almost six years was not maintainable in view of the embargo under Order 2 Rule 2 CPC.

5. He further submitted that as per simple and plain language of Article 54 of the Limitation Act, the cause of action to institute the suit, would be when there was breach. Once the breach had occurred in the year 2004, nothing prevented the plaintiff to seek the relief instead of pursuing the suit for injunction. In fact, the vendor did not have the sufficient funds, as deal was a speculative and kept on prolonging the matter. Even the notices date