Court upheld that limitation for specific performance commenced only after a clear refusal was communicated, which occurred through a notice in May 2022, making the suit filed in July 2023 timely.

ORDER :

R Raghunandan Rao, J.

The respondents herein had filed O.S.No.122 of 2023, before the Principal District Judge, Visakhapatnam, for specific performance of two agreements of sale, dated 08.12.2016. The plaint averments state as follows:

A) The suit schedule property, which is 800 square yards of land, belongs to the petitioner and had been purchased from M/s.Vizag Forgings Limited. By then, the property appears to have already been mortgaged to SIDBI Bank and the petitioner required further funds to get the property released from the mortgage. For this purpose, the petitioner entered into an agreement of sale with the father of the respondents, on 08.12.2016, and the said agreement of sale was registered as document No.6727 of 2016. Apart from this registered agreement of sale, another agreement was also entered, on the same day, by the petitioner with the father of the respondents. A reading of both these agreements together would show that the total sale consideration was fixed at Rs.1,01,96,000/- out of which Rs.18 lakhs had been paid. Thereafter, a sum of Rs.30 lakhs was to be paid, at the time of approval of the onetime settlement scheme sought from SIDBI Bank so that the property can be released from the mortgage. The remaining balance was to be paid within six months thereafter and a sale deed would be registered in favour of the father of the respondent.

B) The father of the respondent is said to have paid Rs.18 lakhs at the time of execution of the agreement. This amount of Rs.18 lakhs was paid by way of two demand drafts. The first demand draft of Rs.15 lakhs was paid to M/s. Pragnna Welding Institute which was a previous agreement holder and Rs.3 lakhs to the petitioner himself.

C) The father of the respondents remitted a sum of Rs.30 lakhs to the loan account of the petitioner, held with SIDBI Bank, on 04.01.2017. Thereafter, a conditional OTS approval, dated 05.01.2017, was issued by SIDBI Bank. The father of the respondents had also paid another amount of Rs.2 lakhs bringing the total sale consideration paid till then, to Rs.50 lakhs.

D) The father of the respondents who was put in possession of the property had developed the property further, by constructing an additional floor and continued to enjoy the property. He passed away on 08.05.2021, leaving behind the respondents as his legal heirs.

E) The father of the respondents, during his life time, had approached the petitioners, several times with a request to obtain an NOC, from SIDBI, so that registration of the sale deed could be completed. The petitioner kept postponing the matter by saying that the OTS proposal is still under consideration and never took the stand that the OTS proposal had failed. The respondents, after the demise of their father, had again approached the petitioner for completion of the sale transaction by obtaining OTS clearance. As this was not being done, the respondents issued a notice on 16.05.2022 calling upon the petitioner to get the property released from the mortgage and to execute the registered deed of sale by receiving the remaining sale consideration of Rs.51,96,000/-. The petitioner replied to this notice by a notice, dated 30.05.2022, denying his liability and raising various allegations which are not correct. The respondents had thereupon filed O.S.No.122 of 2023, before the Principal District Judge, Visakhapatnam, for specific performance of the two agreements, dated 08.12.2016.

2. During the pendency of the suit, the petitioner mov