Indian Evangelical Lutheran Church Trust Association vs Sri Bala and Co.

2025 INSC 42 REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.1525 OF 2023

INDIAN EVANGELICAL LUTHERAN CHURCH TRUST ASSOCIATION … APPELLANT

VERSUS

SRI BALA & CO. ... RESPONDENT

JUDGMENT

NAGARATHNA, J.

This appeal has been filed by assailing the order dated

15.03.2022 passed by the Madras High Court, Madurai Bench in

C.R.P. (MD) No.1116 of 2011 dismissing the Civil Revision Petition

filed by the appellant.

1.1 For the sake of convenience, the parties in the present appeal

are being referred to as per their status and positions before the

trial court.

Factual Background:

2. Signature Not Verified According to the plaintiff/respondent herein, the present Digitally signed by NEETU SACHDEVA Date: 2025.01.08

dispute pertains to land measuring 5.05-acre being a portion of a 16:55:05 IST Reason:

Page 1 of 49

6.48-acre property known as Loch End at Kodaikanal, originally

purchased by American missionaries of the Lutheran Church

Missouri Synod and Missouri Evangelical Lutheran India Mission

in 1912. The Kodaikanal International School (seeking to implead

in the suit) is located across the road from Loch End. In 1975, an

agreement was made between the American missionaries and the

India Evangelical Lutheran Church Trust Association (defendant/

appellant herein) to transfer various properties, including the

Kodaikanal property, to the defendant. This agreement was

formalized through the joint filing of O.P. No.101/1975 under

Section 7 of the Charitable and Religious Trust Act, 1921 before

the District Judge, Madurai, leading to a decree dated 26.11.1975,

appointing the defendant as the trustee of those properties for the

objects of the Trust stated thereunder.

2.1 According to the plaintiff, the defendant being in need of

funds decided to sell a part of those properties, including the 5.05

acres of Loch End, consisting of 12 out of 15 buildings (hereinafter

referred to as “suit scheduled property”). An agreement to sell was

executed on 26.04.1991 between the defendant and the plaintiff,

i.e., M/s. Sri Bala & Co., for the suit scheduled property, on a total

Page 2 of 49 sale consideration fixed at Rs.3,02,00,000/- (Rupees Three Crores

and Two Lakhs only) and an advance payment of Rs. 10,00,000/-

(Rupees Ten Lakhs only) was made. Partial possession of the

property is said to have been handed over to the plaintiff. At that

time, the impleading party was allegedly in possession of three of

the twelve buildings on Loch End in the capacity of a tenant.

2.2 The plaintiff filed an unnumbered suit in the year 1993 before

the Court of the Subordinate Judge, Dindigul Anna District for

specific performance of the agreement to sell dated 26.04.1991, by

seeking execution of the sale deed in respect of the suit scheduled

property and for placing the plaintiff in possession of the property.

The said suit was subsequently transferred to the Court of the

Subordinate Judge, Palani. But the said suit was rejected vide

order dated 12.01.1998 passed by the Court of Subordinate Judge,

Palani due to non-payment of requisite court-fees by the plaintiff.

2.3 The plaintiff thereafter filed O.S. No.49/2007 before the

Court of the Principal District Judge, Dindigul District, seeking

specific performance of the sale agreement dated 26.04.1991, with

a direction to the defendant to execute the sale deed in favour of

Page 3 of 49 the plaintiff after receiving the balance sale consideration for the

suit scheduled property.

2.4 The defendant sought rejection of the second suit by filing

I.A. No.233/2007 under Order VII Rule 11(d) of the Code of Civil

Procedure, 1908 (for short, “Code”), on the ground that the

subsequent suit for specific performance is barred by the principle

of res judicata as the plaintiff had not filed any appeal against the

rejection of the plaint in the previous suit. The defendant also

contended that the subsequent suit for specific performance was

barred by the law of limitation since it was filed after a gross delay

of almost nine years and beyond the period stipulated under

Article 54 of the Limitation Act, 1963 (“Limitation Act”, for short).

2.5 The plaintiff filed its objections to the defendant’s application

for rejection of plaint and placed reliance on Order VII Rule 13 of

the Code to argue that a rejection of a plaint does not preclude the

presentation of a fresh plaint for the same cause of action. It was

further contended by the plaintiff that as per the sale agreement,

the Kodaikanal International School, which is in possession of part

of the suit scheduled property in the capacity of a tenant, has to

be evicted and the vacant possession ought to be handed over to

Page 4 of 49 the plaintiff. Since the tenants had not been vacated from the

property, the suit for specific performance of the sale agreement is

not barred by Article 54 of the Limitation Act. Reliance was placed

by the Plaintiff on an extension letter dated 15.07.1991 executed

by the defendant’s Secretary-cum-Treasurer namely Reverent A.

Sundaram in favour of the plaintiff, which had extended the period

of the sale agreement in light of multiple pending litigations with

the impleading party.

2.6 The said application, i.e., I.A. No.233/2007, was dismissed

by the trial court vide order dated 16.09.2010, on the grounds that

the previous suit was not decided on merits and therefore the

principle of res judicata would not apply and further, the issue of

limitation period being extended to file the suit for specific

performance in light of the pending litigations with the impleading

party was a question of fact and the said issue had to be

adjudicated only after examination of proper witnesses and

documents during trial. Thus, the trial court refused to reject the

plaint at such an early stage.

2.7 Being aggrieved by the order of the trial court, defendant

preferred a civil revision petition before the High Court being C.R.P.

Page 5 of 49 (MD) No.1116/2011. However, the High Court on 15.03.2022

dismissed the said Civil Revision Petition. The High Court observed

that the previous suit was neither registered nor numbered and

since the issues were not finally decided, it was not hit by the

principle of res judicata. Further, the question of extension of the

limitation period is a mixed question of fact and law which can be

decided only after the recording of evidence and not at the stage of

rejection of plaint. Thus, the High Court confirmed the order dated

16.09.2010 passed by the trial court on the application filed by the

defendant for rejection of the plaint. The said order of the High

Court in C.R.P. (MD) No.1116/2011 is under challenge in this

appeal.

2.8 Two more orders arising out of the same set of facts were

passed by the Madras High Court, Madurai Bench on the same

date as that of the impugned order. The issues in those matters

dealt with impleadment and beneficiary rights of the impleading

party with respect to the suit scheduled property. This Court

granted leave in those matters as well and had tagged them with

the present matter. However, since the present appeal deals with

an issue more germane to the suit and the relevance of those two

Page 6 of 49 appeals rests on the fate of the present appeal, the present appeal

was de-tagged by this Court from the other two connected matters

vide order dated 24.10.2024.

Submissions:

3. We have heard Sri P.V. Balasubramaniam, learned senior

advocate for the appellant/defendant and learned senior advocate

Sri V. Giri for the respondent/plaintiff and perused the material

on record.

3.1 Sri Balasubramaniam, at the outset submitted that both the

High Court as well as the trial court were not right in dismissing

the application filed by the appellant/defendant in the suit under

Order VII Rule 11(d) of the Code. No doubt, the

respondent/plaintiff in the suit had the right to file another suit

on the same cause of action after rejection of the plaint in the

earlier unnumbered suit filed by it in the year 1993 for the relief of

specific performance of the agreement to sell dated 26.04.1991 on

the strength of Order VII Rule 13 of the Code. However, the said

suit had to be on the same cause of action as the earlier suit and

within the period of limitation as prescribed under the Limitation

Act, 1963. Thus, the rejection of the plaint in the earlier suit filed

Page 7 of 49 by the respondent/plaintiff was not a bar to file a fresh suit on the

same cause of action. The law provides for another opportunity to

a plaintiff to reagitate on an identical cause of action despite the

rejection of the plaint in the earlier suit filed by a plaintiff on the

basis of Order VII Rule 13 of the Code. However, the second suit

which is on the same cause of action must be maintainable in law

and not hit by Order VII Rule 11(d) of the Code.

3.2 Elaborating on the aforesaid contention, learned senior

counsel submitted that in the instant case, the first suit was filed

in the year 1993 to seek specific performance of the agreement to

sell dated 26.04.1991 which suit was filed within the period of

limitation as prescribed under Article 54 of the Limitation Act. The

plaint of the said suit was rejected vide order dated 12.01.1998

owing to non-payment of the requisite court-fees by the plaintiff. If

another suit had to be filed by the very same plaintiff on the very

same cause of action, then the second suit had to be within the

prescribed period of limitation and otherwise not barred by law. In

the instant case, the respondent/plaintiff filed the second suit only

in the year 2007 for specific performance of agreement to sell dated

26.04.1991, when the cause of action accrued to the

Page 8 of 49 respondent/plaintiff in the year 1993 itself, i.e., when the earlier

suit was filed. Even if the period of the pendency of the said earlier

suit till the rejection of the plaint on 12.01.1998 is excluded for the

purpose of computing the limitation period which had commenced

as early as in the year 1993, there is no explanation as to why the

second suit i.e., O.S. No.49/2007 was filed only in the year 2007.

At best, the limitation period could have extended for a period of

three years from 12.01.1998 for the filing of the second suit by the

respondent/plaintiff. That, the aforesaid facts are all admitted by

the respondent/plaintiff in the plaint itself and hence, on that

basis the trial court as well as the High Court ought to have

exercised their jurisdiction in rejecting the plaint in O.S.

No.49/2007 as the filing of the second suit in the year 2007 is way

beyond the prescribed period of limitation.

3.3 It was contended that when the earlier suit was filed by the

respondent/plaintiff, it was on the basis of the cause of action that

had accrued to the plaintiff. If the plaint in the earlier suit was

rejected on 12.01.1998, then the second suit ought to have been

filed immediately thereafter so as to maintain a continuity in the

cause of action or possibly within three years from the date of the

Page 9 of 49 rejection of the plaint, which would mean that the suit ought to

have been filed by 12.01.2001. But, in the instant case, the filing

of the suit in the year 2007 gives rise to an inference that the

respondent/plaintiff had acquiesced to the rejection of the plaint

and thus had waived its right to seek specific performance of the

agreement to sell dated 26.04.1991. Therefore, the filing of the

second suit in the instant case is only an afterthought, a chance

and being speculative in nature, ought to have resulted in rejection

of the plaint on the basis of Order VII Rule 11(d) of the Code as

being hit by Article 54 of the Limitation Act and therefore, barred

in law.

3.4 It was therefore submitted that the plaint in O.S. No.49/2007

may be rejected by setting aside the impugned order and allowing

this appeal.

3.5 Per contra, learned senior counsel Sri Giri supported the

impugned orders rejecting the application filed by the appellant

herein under Order VII Rule 11(d) of the Code and contended that

there is no merit in this appeal. Elaborating on this submission,

Sri Giri contended that on the basis of Order VII Rule 13 of the

Code, the second suit, namely, O.S. No.49/2007 was filed. In the

Page 10 of 49 plaint of the aforesaid suit, it has been categorically averred that

the letter dated 15.07.1991 which was executed by the Secretary-

cum-Treasurer Reverend, namely, A. Sundharam in favour of the

plaintiff clearly extended the period of limitation owing to multiple

litigations pending between the parties and the party seeking to

implead in the said suit. Further, the question of a suit being

barred under Article 54 of the Limitation Act is a mixed question

of law and fact which cannot be decided on mere averments made

in the plaint. Hence, the trial court as well the High Court rightly

rejected the application filed by the appellant herein for seeking

rejection of the plaint. It was contended that owing to the pendency

of litigation between the parties, the time for performance under

the agreement dated 26.04.1991 was automatically extended and

therefore, it was only when the other litigation between the parties

herein and the impleading party in the suit concluded that the

cause of action for filing the second suit in the year 2007

resurfaced as till then it was dormant and hence, there is no merit

in this appeal. It was contended that there was in fact no basis to

file the application under Order VII Rule 11(d) of the Code by the

appellant herein as the issue of limitation could have been

adjudicated upon on conclusion of the trial and along with the

Page 11 of 49 other issues which arise in the suit. It was submitted that there is

no merit in this appeal and the same may be dismissed.

3.6 By way of reply, learned senior counsel for the appellant

contended that there is a contradiction in the submission of the

respondent/plaintiff inasmuch as when the earlier suit was filed

in the year 1993 it was on the basis of a cause of action which had

accrued to the plaintiff and there was no reference to letter dated

15.07.1991 extending the time for performance under the

agreement or for that matter, resulting in extension of time for the

filing of the suit akin to Section 18 of the Limitation Act. There is

no reference to the letter dated 15.07.1991 in the earlier suit filed

by the respondent/plaintiff and the same is also not admitted by

the appellant herein. Even otherwise, the pendency of other

litigations vis-à-vis the suit scheduled property could not have

been a reason for filing the second suit as late as in the year 2007

for seeking specific performance of the agreement to sell dated

15.07.1991. On a comparison of the earlier suit and the present

suit and on a holistic reading of the plaint in the second suit, the

trial court as well as the High Court ought to have allowed the

application filed by the appellant herein and rejected the plaint as

Page 12 of 49 being barred in law, hit by the Limitation Act and thus, coming

within the scope and ambit of Order VII Rule 11(d) of the Code.

Therefore, learned senior counsel submitted that the present

appeal may be allowed with costs.

Points for Consideration:

4. The short issue before this Court in this appeal is, whether

the plaint in the subsequent suit for specific performance filed by

the plaintiff, i.e., O.S. No.49/2007, is liable to be rejected in terms

of Order VII Rule 11(d) of the Code on the ground that the said suit

is barred by the law of limitation. What order is to be passed?

5. The detailed narration of facts and contentions would not call

for a reiteration.

5.1 The undisputed facts of the case are that on 26.04.1991, the

appellant/defendant entered into an agreement to sell the suit

scheduled property to the respondent/plaintiff for a total

consideration of Rs.3,02,00,000/- (Rupees Three Crores and Two

Lakhs only) and an advance payment of Rs.10,00,000/- (Rupees

Ten Lakhs only) was made. There was a time schedule for the

payment of the balance in sale consideration within a period of

twenty-seven months from 26.04.1991 which is also extracted in

Page 13 of 49 paragraph 4 of the plaint. Thus, within a period of twenty-seven

months from the date of the agreement, the entire balance of sale

consideration had to be paid by the respondent/plaintiff to the

appellant herein. However, as early as in 1993 itself, the suit for

specific performance of the agreement to sell was filed by the

respondent/plaintiff, which was an unnumbered suit, but the

plaint in the said suit was rejected vide order dated 12.01.1998

passed by the trial court due to non-payment of the requisite court

fees by the respondent/plaintiff.

5.2 Thereafter, it was only in the year 2007 that the

respondent/plaintiff filed O.S. No.49/2007 seeking the very same

relief of specific performance of the sale agreement on receipt of

the balance sale consideration. This suit was filed on the strength

of Order VII Rule 13 of the Code. It is in this suit that the

appellant/defendant filed an application under Order VII Rule

11(d) of the Code on the ground that the said suit was barred by

the law of limitation since it was filed after a gross delay of almost

nine years from the date of rejection of the plaint in the earlier suit

and the said suit not being maintainable as barred in law.

Consequently, the plaint was subject to rejection. The trial court

Page 14 of 49 dismissed the application filed for seeking rejection of the plaint by

its order dated 16.09.2010 and the said order has been sustained

by the High Court by the impugned order.

Legal Framework:

Order VII Rule 11 of the Code:

6. Since the issue in this appeal pertains to the correctness or

otherwise of the impugned orders refusing rejection of the plaint,

at this stage, we deem it necessary to refer to Order VII Rule 11 of

the Code which deals with the grounds for rejection of a plaint:

“11. Rejection of plaint. - The plaint shall be rejected in the following cases-

(a) where it does not disclose a cause of action;

(b) where the relief claimed is undervalued, and the plaintiff, on being required by the Court to correct the valuation within a time to be fixed by the Court, fails to do so;

(c) where the relief claimed is properly valued, but the plaint is written upon paper insufficiently stamped, and the plaintiff, on being required by the Court to supply the requisite stamp-paper within a time to be fixed by the Court, fails to do so;

(d) where the suit appears from the statement in the plaint to be barred by any law:

(e) where it is not filed in duplicate;

(f) where the plaintiff fails to comply with the provision of rule 9:

Page 15 of 49

Provided that the time fixed by the Court for the correction of the valuation or supplying of the requisite stamp-paper shall not be extended unless the Court, for reasons to be recorded, is satisfied that the plaintiff was prevented by any cause of an exceptional nature for correcting the valuation or supplying the requisite stamp-paper, as the case may be, within the time fixed by the Court and that refusal to extend such time would cause grave injustice to the plaintiff.”

6.1 In the instant case, an application was filed under Order VII

Rule 11(d) of the Code where the ground of rejection of the plaint

was that the suit appears from the statement in the plaint to be

barred by any law. In this regard, our attention was drawn to

various decisions of this Court with regard to rejection of plaint

under Order VII Rule 11 of the Code which are as follows:

(i) In T. Arivandandam vs. T.V. Satyapal, (1977) 4 SCC

467, this Court while examining the aforesaid provision has

held that the trial court must remember that if on a

meaningful and not a formal reading of the plaint it is

manifestly vexatious and meritless in the sense of not

disclosing a clear right to sue, it should exercise the power

under Order VII Rule 11 of the Code taking care to see that

the ground mentioned therein is fulfilled. If clever drafting

Page 16 of 49 has created the illusion of a cause of action, it has to be

nipped in the bud at the first hearing by examining the party

searchingly under Order X of the Code, as observed by

Krishna Iyer, J.

(ii) The object of the said provision was laid down by this Court

in Sopan Sukhdeo Sable vs. Assistant Charity

Commissioner, (2004) 3 SCC 137. Similarly, in Popat and

Kotecha Property vs. State Bank of India Staff

Association, (2005) 7 SCC 510, this Court has culled out

the legal ambit of Order VII Rule 11 of the Code.

(iii) It is trite law that not any particular plea has to be

considered, but the whole plaint has to be read. As was

observed by this Court in Roop Lal Sathi vs. Nachhattar

Singh Gill, (1982) 3 SCC 487, only a part of the plaint

cannot be rejected and if no cause of action is disclosed, the

plaint as a whole must be rejected. Similarly, in Raptakos

Brett & Co. Ltd. vs. Ganesh Property, (1998) 7 SCC 184,

it was observed that the averments in the plaint as a whole

have to be seen to find out whether clause (d) of Rule 11

Order VII of the Code is applicable.

Page 17 of 49

(iv) It was further held with reference to Order VII Rule 11 of the

Code in Saleem Bhai vs. State of Maharashtra, (2003) 1

SCC 557 that the relevant facts which need to be looked into

for deciding an application thereunder are the averments in

the plaint. The trial court can exercise the power at any stage

of the suit i.e. before registering the plaint or after issuing

summons to the defendant at any time before the conclusion

of the trial. For the purposes of deciding an application

under clauses (a) and (d) of Order VII Rule 11 of the Code,

the averments in the plaint are germane; the pleas taken by

the defendant in the written statement would be wholly

irrelevant at that stage.

(v) In R.K. Roja vs. U.S. Rayudu, (2016) 14 SCC 275, it was

reiterated that the only restriction is that the consideration

of the application for rejection should not be on the basis of

the allegations made by the defendant in his written

statement or on the basis of the allegations in the

application for rejection of the plaint. The court has to

consider only the plaint as a whole, and in case the entire

Page 18 of 49 plaint comes under the situations covered by Order VII

Rules 11(a) to (f) of the Code, the same has to be rejected.

(vi) In Kuldeep Singh Pathania vs. Bikram Singh Jaryal,

(2017) 5 SCC 345, this Court observed that the court can

only see whether the plaint, or rather the pleadings of the

plaintiff, constitute a cause of action. Pleadings in the sense

where, even after the stage of written statement, if there is a

replication filed, in a given situation the same also can be

looked into to see whether there is any admission on the part

of the plaintiff. In other words, under Order VII Rule 11, the

court has to take a decision looking at the pleadings of the

plaintiff only and not on the rebuttal made by the defendant

or any other materials produced by the defendant.

(vii) In an application under Order VII Rule 11 of

the Code, a plaint cannot be rejected in part. This principle

is well established and has been continuously followed since

the 1936 decision in Maqsud Ahmad vs. Mathra Datt &

Co. AIR 1936 Lah 1021. This principle is also explained

in another decision of this Court in Sejal Glass

Ltd. vs. Navilan Merchants Private Ltd., (2018) 11 SCC

Page 19 of 49 780 which was again followed in Madhav Prasad

Aggarwal vs. Axis Bank Ltd., (2019) 7 SCC 158.

(viii) In Biswanath Banik vs. Sulanga Bose, (2022) 7 SCC 731,

this Court discussed the issue whether the suit can be said

to be barred by limitation or not, and observed that at this

stage, what is required to be considered is the averments in

the plaint. Only in a case where on the face of it, it is seen

that the suit is barred by limitation, then and then only a

plaint can be rejected under Order VII Rule 11(d) of the Code

on the ground of limitation. At this stage what is required to

be considered is the averments in the plaint. For the

aforesaid purpose, the Court has to consider and read the

averments in the plaint as a whole.

Order VII Rule 13 of the Code:

7. Order VII Rule 13 of the Code reads as under:

“13. Where rejection of plaint does not preclude presentation of fresh plaint.- The rejection of the plaint on any of the grounds hereinbefore mentioned shall not of its own force preclude the plaintiff from presenting a fresh plaint in respect of the same cause of action.”

Page 20 of 49 7.1 This Court in Delhi Wakf Board vs. Jagdish Kumar

Narang (1997) 10 SCC 192 was dealing with a case where an

earlier suit had been rejected under Order VII Rule 11 of the Code

in the year 1984 and a fresh suit was instituted on the same cause

of action in the year 1986. The second suit was not allowed by the

trial court as well as by the High Court. This Court set aside the

orders of the trial court and the High Court and held that a suit

filed on the same cause of action subsequent to rejection of the

plaint in the previous suit under Rule 11 is not liable to be

dismissed on the ground of being barred by order rejecting the

plaint in the earlier suit.

7.2 In A. Nawab John vs. V.N. Subramaniyam, (2012) 7 SCC

738, this Court examined the applicability of Order VII Rule 11 of

the Code which requires a plaint to be rejected, inter alia, where

the relief claimed is undervalued and/or the plaint is written on a

paper insufficiently stamped, and, in either case, the plaintiff fails

to either correct the valuation and/or pay the requisite court fee

by supplying the stamp paper within the time fixed by the court.

Rule 13 categorically declares that the rejection of a plaint shall

not of its own force preclude the plaintiff from presenting a fresh

Page 21 of 49 plaint in respect of the same cause of action. It was also observed

that under Order VII Rule 11, a plaint, which has not properly

valued the relief claimed therein or is insufficiently stamped, is

liable to be rejected. However, under Rule 13, such a rejection by

itself does not preclude the plaintiff from presenting a fresh plaint.

It naturally follows that in a given case where the plaint is rejected

under Order VII Rule 11 of the Code and the plaintiff chooses to

present a fresh plaint, necessarily the question arises whether

such a fresh plaint is within the period of limitation prescribed for

the filing of the suit. If it is to be found by the court that such a

suit is barred by limitation, once again it is required to be rejected

under Order VII Rule 11 clause (d).

7.3 However, Section 149 of the Code, as interpreted by this

Court in Mannan Lal vs. Mst. Chhotaka Bibi, (Dead) by LRs.,

(1970) 1 SCC 769, confers power on the court to accept the

payment of deficit court fee even beyond the period of limitation

prescribed for the filing of a suit, if the plaint is otherwise filed

within the period of limitation.

7.4 The case of Patil Automation Private Ltd. vs. Rakheja

Engineers Private Ltd., (2022) 10 SCC 1 further discussed that

Page 22 of 49 under Order VII Rule 11 of the Code, the plaint can be rejected on

six grounds. They include failure to disclose the cause of action,

and where the suit appears from the statement in the plaint to be

barred. Order VII Rule 12 of the Code provides that when a plaint

is rejected, an order to that effect with reasons must be recorded.

Order VII Rule 13 provides that rejection of the plaint mentioned

in Order VII Rule 11 does not by itself preclude the plaintiff from

presenting a fresh plaint in respect of the same cause of action.

Order VII of the Code deals with various aspects about what is to

be pleaded in a plaint, the documents that should accompany and

other details. Order IV Rule 1 provides that a suit is instituted by

presentation of the plaint to the court or such officer as the court

appoints. By virtue of Order IV Rule 1(3), a plaint is to be deemed

as duly instituted only when it complies with the requirements

under Order VI and Order VII. Order V Rule 1 declares that when

a suit has been duly instituted, a summon may be issued to the

defendant to answer the claim on a date specified therein. It was

therefore held that rejection of earlier suit under Order VII Rule 11

does not bar fresh suit on the same cause of action provided the

right of action is not barred by the law of limitation.

Page 23 of 49 Averments in the plaint:

8. Since the plaint has to be read holistically in order to

ascertain whether it is barred by limitation and consequently, to

decide if the suit itself is not maintainable, we now embark on a

meaningful reading of the plaint in O.S. No.49/2007 which is

sought to be rejected by the appellant herein, as under:

(i) Paragraphs 1 and 2 of the plaint give details of the plaintiff

and defendant.

(ii) In paragraph 3 of the plaint, it has been averred that there

was a written agreement of sale executed on 26th April,

1991 with regard to the suit scheduled property by the

defendant/vendor as the absolute owner of the property

with the plaintiff/purchaser. The sale price mutually

agreed upon was Rs.3,02,00,000/- (Rupees Three Crores

and Two Lakhs only) and an advance amount of

Rs.10,00,000/- (Rupees Ten Lakhs only) was paid earlier

on 26th March, 1991, a month prior to the written

agreement being executed, wherein a payment of

Rs.9,00,000/- (Rupees Nine Lakhs only) was made by

demand draft of Canara Bank dated 23.03.1991 payable

at Nagerkoil and Rs.1,00,000/- (Rupees One Lakh only) by

Page 24 of 49 way of an account payee cheque of City Union Bank,

Madras.

(iii) Paragraph 4 of the plaint gives the time schedule for

receipt balance sale consideration of Rs.2,92,00,000/-

(Rupees Two Crores ninety-two lakhs only) in the following

manner:

“(a) Rs.10,00,000/-, (Rupees Ten lakhs only) to be paid within 3 months from the date this agreement subject to the condition that the vacant possession of the properties occupied by tenants are handed over to the plaintiff on or before 1.6.1991.

(b) Rs.20,00,000/- (Rupees Twenty lakhs) to be paid within 9 months from the date of the agreement.

(c) Rs.30,00,000/- (Rupees Thirty lakhs) to be paid within 9 months from the date of the agreement.

(d) Rs.30,00,000/- (Rupees Thirty lakhs) to be paid within 12 months from the date of the agreement.

(e) Rs.40,00,000/- (Rupees Forty lakhs) to be paid within 15 months from the date of the agreement.

(f) Rs.40,00,000/- (Rupees Forty lakhs) to be paid within 15 months from the date of the agreement.

(g) Rs.40,00,000/- (Rupees Forty lakhs) to be paid within 21 months from the date of the agreement.

(h) Rs.40,00,000/- (Rupees Forty lakhs) to be paid within 24 months from the date of the agreement..

Page 25 of 49 (i) Rs.42,00,000/- (Rupees Forty two lakhs) paid within 27 Months from the date of the agreement.

The true copy of the sale deed is submitted herewith and it may be read as part of the plaint allegations.”

(iv) Paragraph 5 of the plaint avers that the entire balance

consideration has to be paid within 27 months, i.e., before

25.07.1993 but time is not the essence of the contract.

Further, there is a condition precedent that the vacant

possession of the properties occupied by the tenant are to

be handed over to the plaintiffs on or before 01.06.1991.

(v) In paragraph 6 it is stated that the suit scheduled property

and the adjacent property are popularly known as Loch

End property wherein there are 15 buildings in an extent

of 6.48 acres, out of which the defendant agreed to sell

5.05 acres consisting of 12 buildings. That at the time of

agreement the tenant was in occupation of three buildings

and on the date of the agreement the plaintiff was put in

possession of nine buildings detailed therein.

(vi) Paragraph 7 of the plaint states that at the time of the

agreement to sell, one Rev. J. Isaac Moon was the

President of the defendant company and the Board of

Directors by its Resolution/Proceedings, authorised the

Page 26 of 49 Secretary Treasurer Rev. A. Sundharam to execute the

agreement to sell and the same was later ratified by the

Board of Directors of the defendant company.

(vii) Paragraphs 8 to 16, 18 and 20 of the plaint are extracted

as under:

“8. Rev. J. Isaac Moon for the reasons best known to him did not like the suit property being sold to the plaintiff. Therefore, he whipped up the religious sentiments. As per the agreement to sell, the plaintiff was put in the possession of the tenanted premises also on 1.7.1991 by the defendant. Bin Rev. J. Isaac Moon instigated the tenant to proffer a false complaint against the personnel of the defendant and the plaintiff and her husband before the police as though the tenant was evicted by force Therefore proceedings were initiated u/s 145 of the code of Criminal Procedure in M.C. No. 1/1991 on the file of the Sub-Divisional Magistrate-Cum-Revenue Divisional Officer Kodaikanal.

9. The plaintiff was forced to file a suit for permanent injunction against the tenant to protect possession in O.S.No.66 of 1991 on the file of the District Munsif Court Kodaikkanal and obtained ad-interim orders in I.A.No.75/1991 also. Again the tenant file a Writ petition before Hon'ble High Court in W.P.No.9551/ 1991 seeing protection further against the ad interim order in I.A.No.75/1991 the tenant also filed Revision before Hon'ble High Court in C.R.No.1846/1991 and obtained stay of operation of the order. In the meantime, the Sub Divisional Magistrate-cum-

Revenue Divisional Office Kodaikanal on 9.12.1991 found possession only with the plaintiff and against which also the tenant filed a Revision

Page 27 of 49 before the Hon’ble High Court in Court in Crl. R.C. No.113/1992.

10. Since the defendant's president Rev. J. Issac Moon, without any authority was acting against the decisions / resolutions / proceedings of the Board of Directors, the defendant extended the time for performance of the contract till the disposal of the all litigations on 15.07.1991. The true of copy, of the letter extending the time for performance is also submitted herewith for better appreciation of facts.

11. In the meantime, the plaintiff also filed a suit with deficit court fee for specific performance of the contract and the same was allowed to be rejected for non-payment of dealt court fee by the Hon’ble sub-court Palani. In the meantime the tenant also filed several applications in O.P.No. 101/1975 in

1.A.No. 1500/92 and 1.A.No. 1501/92 on the file of the District Court Dindigul questioning the validity of the agreement to sell and also filed various suits in O.S.No 13/93 and in O.S.No. 108/93 on the file of the District Munsif court Kodaikkanal for taking inventory and for permanent injunction against the defendant from alienating the suit property. In view of multiplicity of proceedings initiated by the tenant, the plaintiff was advised not to proceed with the suit for specific performance on the file of the Sub-Court Palani at that time. It is needless to submit that under order 7. Rule 13 of C.P.C. rejection of earlier plaint is not a bar to the suit.

12. Subsequently the Hon'ble High Court passed a common order setting aside the ad-interim orders passed in I.A. No. 75/91 in O.S.No. 66/91 on the file of District Munsif Court Kodaikanal and the order passed by SDK cum RDO/ Kodaikkanal in MC 1/1991 in C.R.P, No. 1846/91 and Crl.R.C.No. 113/92 respectively, In view of the order of the High court, the tenant with the help

Page 28 of 49 of police took possession of not only the three tenanted premised but also the other 9 buildings in the occupation of the plaintiff, on 24.07.1997 with the help of Rev. Isaac Moon and the local police.

13. The plaintiff preferred special Leave Petitions against the orders of the Hon'ble High Court in W.P. No. 9551/1991, C.R.P. No. 1846/1991 and Cri. R.C.No, 113/1992: The Hon'ble Supreme Court in SI.O. (Crl) No.2037/97 (C) No. 2038/97 and 2039/97 set aside the order of the Hon'ble High Court and remanded the same an 24.3.1998.

14. In the meantime, the tenant not pressed that suit in O.S.No.13/93 and 108/96 on the file of the District: Munsif Court Kodaikkanal besides 1.A. No.1501/92 in O.P.101/1975 on the file of the District Court Dindigul.

15. Again, SUM Cum RDO Kodailcanal found the tenant to be in possession in M.C.No. 1/1991 after remand of the matter by the Hon'ble Supreme court of India, without hearing the plaintiff.

Against which the plaintiff also preferred a Revision before Hon’ble High Court in Crl.

R.C.No.511/1999. The Hon’ble High Court dismissed the Revision and titt7-51aintiff has also preferred, a special Leave Petition before Hon'ble supreme Court of India in SLP.No.1239/2005 and the same is still, pending along with other SLPs filed by the plaintiff arising out of orders dated 29.04.2003 in CRP.No.232/2003 by the Hon’ble High Court against the orders in I.A. No. 59/2002 in O.S.No. 66/1991 on the file of the District Munsif Court Kodaikanal and against the orders in CRP No.649/2003 which was filed against taking on file IA.55/2003 in O.S. No.66 of 1991 on the file of the District Munsif Court Kodaikkanal.

16. In the meantime, on 25.4.2003 the Hon'ble District Judge Dindigul dismissed I.A.No. 1500/1992 in

Page 29 of 49 O.P.No. 101/1975 holding that the agreement to sell dated 26.4.1991 between the plaintiff and the defendant is valid and enforceable. The tenant also filed a memo exonerating, the plaintiff and the tenant even filed I.A.No. 1500/2012 to delete the name of the plaintiff from the decretal and orders in I.A. No. 1500/1992 after its dismissal. The Hon'ble District, Judge dismissed 1.A. No.1575/2005 on 5.4.2007.

xxx

18. Further, there were various litigations over the election of conveners of three Synods, and board of Directors to the defendant company froth July 1992. An advocate - Commissioner was appointed by the Hon’ble High Court to conduct election to the defendant company. Therefore, the plaintiff could not negotiate or deal with the defendant for enforcement of the contract for sale as there was confusion in the part of the plaintiff filing this suit. Even not there is no clear picture as to the election of Directors to the Board of the defendant company, and the secretary of the company.

xxx

20. As for as the suit for permanent injunction in O.S. No. 66 of 1991 on the file of the District Munsif Court Kodaikkanal now stands transferred to the file of the District Munsif chuft Dindigul and the same is still pending in O.S. No. 76/2005.”

The aforesaid paragraphs refer to various proceedings

initiated in the years 1991, 1992, 1993 and give the details

of those proceedings, some of which had been disposed

while other/s were pending on the date of the filing of the

plaint or suit.

Page 30 of 49

(viii) Paragraph 17 of the plaint reads as under:

“17. In view of the cantankerous attitude of the tenant and vexatious litigation of the tenant, the plaintiff could not file the suit for specific performance of contract earlier. The plaintiff was always ready and willing to perform her part of the contract.”

(ix) Paragraphs 19 and 21 of the plaint are extracted as under

with regard to the filing of the suit for specific performance

and cause of action for the same.

“19. Any how, the plaintiff has not been advised to file this suit for specific performance. The plaintiff has paid urban land Tax to the tune of Rs.35,670/- and property Tax for Rs.6652/-.for the suit property. Further, the suit property had been attached for the Income Tax due to the govt. by the plaintiff.

xxx

21. Cause of action for the suite arose on 26.4.1991 when the plaintiff and the Defendant entered into an agreement of sale with regard to the schedule mentioned property herein under on 15.07.1991 when the time for performance of contract is extended till the disposal of litigations launched at the instance of the president of the company through the tenant, on 25.4.2003 when the Hon'ble District Judge upheld the validity of the sale agreement dated 26.4.1991 and on 5.4.2007 when I.A.No.1515/2003 was dismissed to delete the name of the plaintiff and at Kodaikanal Township where the suit property situate within the jurisdiction of this Hon'ble Court.”

Page 31 of 49 8.1 What is significant to note is that in paragraphs 10 and 21,

there is a reference to a letter dated 15.07.1991 said to have been

issued by the defendant which is contended to be for the purpose

of extending the time for performance of the contract till the

disposal of litigation launched at the instance of the President of

the defendant through the tenant. Hence, it is averred that the

plaintiff was not advised to file the suit for specific performance

which was ultimately filed in the year 2007, being the second suit

for the same cause of action, when initially, (on the very same

cause of action,) the unnumbered suit was filed on 21.07.1993

wherein the plaint was rejected on the ground that the court fee

had not been tendered despite several opportunities being given.

8.2 Further, in paragraph 17 of the plaint, it has been averred

that due to the cantankerous attitude and vexatious litigation of

the tenant, the plaintiff could not file the suit for specific

performance of the contract earlier, although the plaintiff was

ready and willing to perform her part of the contract. This

averment is totally alien to the filing of the second suit and has no

bearing on the relief sought inasmuch as the tenant is not a party

to the agreement dated 26.04.1991 and the filing and pendency of

Page 32 of 49 litigation vis-à-vis the tenant was not an impediment at all to file

the earlier suit for specific performance of the aforesaid agreement.

8.3 We are conscious and mindful of the fact that while

considering the question of rejection of the plaint, it is the plaint

alone which has to be read meaningfully and not any averment in

the written statement. It is also necessary sometimes to consider

the documents annexed to the plaint for a holistic and

comprehensive reading of the plaint in order to decide whether the

plaint ought to be rejected or not. But the present case is not a

case where there is only one suit which has been filed by the

respondent/plaintiff on the same cause of action and therefore,

only a single plaint ought to be considered while deciding the issue

of rejection of the plaint. This is a case where a second suit has

been filed after the rejection of the plaint in the earlier suit filed on

the very same cause of action and for the very same relief of

seeking specific performance of agreement to sell dated

26.04.1991. In order to ascertain whether the plaint in the second

suit ought to be rejected on the ground that it is barred by law

such as the suit being filed beyond the prescribed period of

limitation and therefore, is barred within the meaning of Order VII

Page 33 of 49 Rule 11(d) of the Code, we think it is useful to consider the fact

that an earlier suit was filed by the respondent/plaintiff on the

very same cause of action in the year 1993 itself which resulted in

the rejection of the plaint in the said suit owing to non-payment of

the court fee. This fact is pertinent when the contention of the

defendant/appellant herein is that the second suit filed on the

basis of Order VII Rule 13 of the Code is barred as it has been filed

beyond the prescribed period of limitation.

8.4 It is nobody’s case that the earlier suit was not filed in time.

The said suit was filed on 21.07.1993, on the basis of the cause of

action that arose for seeking the relief of specific performance of

the agreement to sell dated 26.04.1991. According to the

appellant/defendant, if the cause of action had occurred in the

year 1993 and therefore, the earlier suit was filed in time, without

any reference to the so-called letter dated 15.07.1991 (on the basis

of which extension of time for performance of the contract is

pleaded in the second suit), the rejection of the plaint in the earlier

suit, at best, could have extended the limitation period by three

years from the date of the rejection of the plaint in the earlier suit

so as to maintain a continuity in the cause of action for filing the

Page 34 of 49 second suit. Significantly, in the earlier suit, the plaintiff did not

aver that time for performance of the contract had been extended

on the basis of the letter dated 15.07.1991 said to have been issued

by the defendant. In fact, the stand of the respondent/plaintiff was

to the contrary. It was to the effect that in the absence of

performance of the agreement to sell dated 26.04.1991 by the

defendant, the plaintiff had a cause of action to seek specific

performance of the said agreement. Therefore, the earlier suit was

filed in July, 1993 itself on the basis that the plaintiff had a cause

of action to seek specific performance of the agreement to sell dated

26.04.1991. But owing to non-payment of requisite court fee, the

plaint in the said suit was rejected on 12.01.1998. There was also

no reference to any of the litigations which were pending between

the parties prior to the filing of the earlier suit which is said to have

resulted in postponement of the performance of the contract.

8.5 Thus, if really, the cause of action had arisen for the plaintiff

to file the earlier suit on 01.07.1993 and the plaint in the said suit

was rejected on 12.01.1998 owing to non-payment of the requisite

court fee, then, at best, a second suit on the very same cause of

action could have been filed by 12.01.2001 which would have been

Page 35 of 49 within three years from the date of rejection of the plaint in the

earlier suit. Therefore, the second suit, namely O.S. No.49/2007,

could not have been filed in the year 2007 i.e., nine years after the

rejection of the plaint in the earlier suit. The second suit not having

been filed within a period of three years from 12.01.1998, which

could be construed to be within the meaning of the Limitation Act,

we are of the view that the second suit filed by the

respondent/plaintiff is barred by the law of limitation and is thus

not maintainable.

8.6 To get over this lacuna, the respondent/plaintiff has

introduced the so-called communication/letter dated 12.07.1991

said to have been issued by the defendant by stating that time for

performance of the contract had been extended till the conclusion

of all other litigations between the parties herein and with the

tenant. If reliance is now placed on the said letter by the

respondent/plaintiff so as to seek a continuity in the cause of

action, then the earlier suit could not have been filed at all in the

year 1993 as then no cause of action had arisen to the plaintiff to

file the earlier suit! But the fact remains that the

plaintiff/respondent herein did file the earlier suit in the year 1993

Page 36 of 49 on the ground that they had a cause of action to do so and for the

very same relief of specific performance of the agreement to sell

dated 26.04.1991 was sought but the plaint in the earlier suit

came to be rejected owing to non-payment of the requisite court

fee. Even after the rejection of the plaint in the earlier suit, steps

were not taken on time, i.e., prior to 12.01.2001 to file the second

suit on the basis of Order VII Rule 13 of the Code. Instead, the

second suit has been filed only in the year 2007 belatedly and

possibly only to keep the litigation alive between the parties which,

in our view, is to make an unlawful gain from the speculative

second suit by a settlement or in any other manner.

8.7 We do not appreciate the conduct of the respondent/plaintiff

in filing of the second suit belatedly in the year 2007 when they

could have done so prior to 12.01.2001, if they were really serious

in seeking enforcement of the agreement to sell dated 26.04.1991.

We say so on the basis of the action of the plaintiff in seeking the

relief of specific performance of the agreement to sell dated

26.04.1991 by filing the earlier suit in the year 1993 itself. In the

said suit there was no reference to the letter dated 26.07.1991.

Moreover, litigation concerning the suit scheduled property was

Page 37 of 49 not an impediment to file the earlier suit in the year 1993. Then,

we ask, how could it become an impediment for postponing the

filing of the second suit till the year 2007? We think that the

reliance placed on the letter dated 26.07.1991 in the second suit

filed in the year 2007 (and the glaring omission of any reference to

the said letter in the earlier plaint filed in the year 1993) is

mischievous and cannot be considered to hold that there was an

extension of time for performance of the contract. Therefore, the

second suit filed by the respondent in the year 2007 is not within

the prescribed period of limitation and not as sought to be

contended by the plaintiff.

8.8 Thus, on a holistic reading of the plaint it could be rejected

as being barred by law of limitation. However, it is stated that

normally the question of limitation would be a mixed question of

law and fact. Hence, usually, on a reading of the plaint it is not

rejected as being barred by the law of limitation. However, the

above is not an inflexible rule. We wish to discuss the relevant

Article under the Limitation Act applicable to the facts of the

present case which is Article 113 for the second suit with a preface

on the law of limitation.

Page 38 of 49

9. The Limitation Act, 1963 consolidates and amends the law of

limitation of suits, appeals and applications and for purposes

connected therewith. The law of limitation is an adjective law

containing procedural rules and does not create any right in favour

of any person, but simply prescribes that the remedy can be

exercised only up to a certain period and not beyond. The

Limitation Act therefore does not confer any substantive right, nor

defines any right or cause of action. The law of limitation is based

on delay and laches. Unless there is a complete cause of action,

limitation cannot run and there cannot be a complete cause of

action unless there is a person who can sue and a person who can

be sued. There is also another important principle under the Law

of Limitation which is crystallized in the form of maxim that “when

once the time has begun to run, nothing stops it”.

9.1 In “Limitation Periods” by Andrew McGee, Barrister of

Lincoln’s Inn, published in 2002, the author says that, -

“Once time has begun to run it will run continuously, except in certain situations. Time ceases to run when the plaintiff commences legal proceedings in respect of the cause of action in question. It is a general principle of some importance that the bringing of an action stops the running of time for the purposes of that action only.” 9.2 It is further observed that the barring of the remedy under

the law of limitation on the expiry of the limitation period would

Page 39 of 49 not imply plaintiff’s right being extinguished. Only the possibility

of obtaining a judicial remedy to enforce the right is taken away.

However, in certain cases, the expiry of the period of limitation

would extinguish the plaintiff’s right to seek remedy entirely.

Further, according to Andrew McGee, the policy and justification

for having a statute of limitation has been explained in the

following words:

“Policy issues arise in two major contexts. The first concerns the justification for having statutes of limitation at all and the particular limits that presently exist. The second concerns the procedural rules that apply after an action has been commenced. Arguments with regard to the policy underlying statutes of limitation fall into three main types. The first relates to the position of the defendant. It is said to be unfair that a defendant should have a claim hanging over him for an indefinite period and it is in this context that such enactments are sometimes described as "statutes of peace". The second looks at the matter from a more objective point of view. It suggests that a time-limit is necessary because with the lapse of time, proof of a claim becomes more difficult-documentary evidence is likely to have been destroyed and the memories of witnesses will fade. The third relates to the conduct of the plaintiff, it being thought right that a person who does not promptly act to enforce his rights should lose them. All these justifications have been considered by the courts.”

9.3 Further, to say that a suit is not governed by the law of

limitation runs foul of the Limitation Act. The statute of limitation

was intended to provide a time limit for all suits conceivable.

Section 3 of the Limitation Act provides that a suit, appeal or

Page 40 of 49 application instituted after the prescribed “period of limitation”

must, subject to the provisions of Sections 4 to 24, be dismissed,

although limitation has not been set up as a defence. Section 2(j)

defines the expression “period of limitation” to mean the period of

limitation prescribed in the Schedule for suit, appeal or

application. Section 2(j) also defines “prescribed period” to mean

the period of limitation computed in accordance with the

provisions of the Limitation Act. The court's function on the

presentation of plaint is simply to examine, whether, on the

assumed facts, the plaintiff is within time. The court has to find

out when the “right to sue” accrued to the plaintiff.

9.4 Further, if a suit is not covered by any of the specific articles

prescribing a period of limitation, it must fall within the residuary

article. The purpose of the residuary article is to provide for cases

which could not be covered by any other provision in the Limitation

Act. The residuary article is applicable to every variety of suits not

otherwise provided for under the Limitation Act. It prescribes a

period of three years from the date when the “right to sue” accrues.

Under Article 120 of the erstwhile Limitation Act, 1908, it was six

years, which has been reduced to three years under Article 113 of

the present Act. According to the third column in Article 113, time

Page 41 of 49 commences to run when the right to sue accrues. The words “right

to sue” ordinarily mean the right to seek relief by means of legal

proceedings. Generally, the right to sue accrues only when the

cause of action arises, that is, the right to prosecute to obtain relief

by legal means. The suit must be instituted when the right

asserted in the suit is infringed or when there is a clear and

unequivocal threat to infringe that right by the defendant against

whom the suit is instituted [State of Punjab vs. Gurdev Singh,

(1991) 4 SCC 1].

9.5 This Court in Shakti Bhog Food Industries Ltd. vs.

Central Bank of India, (2020) 17 SCC 260, stated that the

expression used in Article 113 of the 1963 Act is “when the right

to sue accrues”, which is markedly distinct from the expression

used in other Articles in First Division of the Schedule dealing with

suits, which unambiguously refer to the happening of a specified

event. Whereas Article 113, being a residuary clause, does not

specify happening of particular event as such, but merely refers to

the accrual of cause of action on the basis of which the right to sue

would accrue.

Page 42 of 49 9.6 Article 113 of the Limitation Act reads as under:

“PART X – SUITS FOR WHICH THERE IS NO PRESCRIBED PERIOD Description of Period of Time from which suit limitation period begins to run

113. Any suit for Three years When the right to which no period sue accrues.” of limitation is provided elsewhere in the Schedule.

Article 113 of the Limitation Act is an omnibus Article

providing for a period of limitation not covered by any of the

specific Articles. No doubt, Article 54 of the Schedule to the

Limitation Act is the Article providing for a limitation period for

filing a suit for specific performance of a contract. For immediate

reference, the said Article is extracted as under:

Description Period of Time from which period of suit limitation begins to run For specific Three years. The date fixed for the

54. performance performance, or, if no such of a contract. date is fixed, when the plaintiff has notice that performance is refused.

9.7 In the present case, the earlier suit was filed by the

respondent/plaintiff in July, 1993 on the basis of Article 54 referred to above and the plaint in the said suit was rejected on

12.01.1998. The second suit being O.S. No.49/2007 was filed on

Page 43 of 49 the strength of Order VII Rule 13 of the Code for the very same

cause of action and for seeking the very same relief of specific

performance of the agreement dated 26.04.1991 as the plaint in

the earlier suit was rejected on 12.01.1998. Therefore, it cannot be

said that the second suit namely O.S. No.49/2007 was filed as per

Article 54 of the Limitation Act. Since this is a suit filed for the

second time after the rejection of the plaint in the earlier suit, in

our view, Article 54 of the Limitation Act does not apply to a second

suit filed for seeking specific performance of a contract. Then, the

question is, what is the limitation period for the filing of O.S.

No.49/2007. We have to fall back on Article 113 of the Limitation

Act.

9.8 Under Article 113 of the Limitation Act, time commences to

run when the right to sue accrues. This is in contradistinction to

Article 54 of the Limitation Act relating to a suit for specific

performance of a contract which is on the happening of an event.

No doubt, the second suit which is the present suit filed by the

respondent/plaintiff is also for specific performance of the contract

but the right to sue accrued to file the second suit is on the basis

of Order VII Rule 13 of the Code subsequent to the rejection of the

plaint in the earlier suit on 12.01.1998. Therefore, the right to sue

Page 44 of 49 by means of a fresh suit was only after 12.01.1998. The expression

“when the right to sue accrues” in Article 113 of the Limitation Act

need not always mean “when the right to sue first accrues”. For

the right to sue to accrue, the right sought to be vindicated in the

suit should have already come into existence and there should be

an infringement of it or at least a serious threat to infringe the

same vide M.V.S. Manikyala Rao vs. M. Narasimhaswami, AIR

1966 SC 470. Thus, the right to sue under Article 113 of the

Limitation Act accrues when there is an accrual of rights asserted

in the suit and an unequivocal threat by the defendant to infringe

the right asserted by the plaintiff in the suit. Thus, “right to sue”

means the right to seek relief by means of legal procedure when

the person suing has a substantive and exclusive right to the claim

asserted by him and there is an invasion of it or a threat of

invasion. When the right to sue accrues, depends, to a large extent

on the facts and circumstances of a particular case keeping in view

the relief sought. It accrues only when a cause of action arises and

for a cause of action to arise, it must be clear that the averments

in the plaint, if found correct, should lead to a successful issue.

The use of the phrase “right to sue” is synonymous with the phrase

“cause of action” and would be in consonance when one uses the

Page 45 of 49 word “arises” or “accrues” with it. In the instant case, the right to

sue first occurred in the year 1993 as the respondent/plaintiff had

filed the first suit then, which is on the premise that it had a cause

of action to do so. The said suit was filed within the period of

limitation as per Article 54 of the Schedule to the Limitation Act.

9.9 Thus, generally speaking, the right to sue accrues only when

the cause of action arises, that is, the right to prosecute to obtain

relief by legal means. The suit must be instituted when the right

asserted in the suit is infringed or when there is a clear and

unequivocal threat to infringe that right by the defendant against

whom the suit is instituted. Article 113 of the Schedule to the

Limitation Act provides for a suit to be instituted within three years

from the date when the right to sue accrues and not on the

happening of an event as stated in Article 54 of the Schedule to

the Limitation Act.

9.10 In the facts and circumstances of the present case, it is also

necessary to apply Section 9 of the Limitation Act while applying

Article 113 thereto. Section 9 reads as under:

Page 46 of 49

“9. Continuous running of time.— Where once time has begun to run, no subsequent disability or inability to institute a suit or make an application stops it:

Provided that where letters of administration to the estate of a creditor have been granted to his debtor, the running of the period of limitation for a suit to recover the debt shall be suspended while the administration continues.”

Section 9 is based on the general principle that when once

limitation has started to run, it will continue to do so unless it is

arrested by reason of any express statutory provision. Period of

limitation can be extended, inter alia, when cause of action was

cancelled such as by dismissal of a suit. Ordinarily, limitation runs

from the earliest time at which an action can be brought and after

it has commenced to run, there may be revival of a right to sue

where a previous satisfaction of a claim is nullified with the result

that the right to sue which has been suspended is reanimated

[Pioneer Bank Ltd vs. Ramdev Banerjee, (1950) 54 Cal WN

710]. In that case, the court distinguished between suspension

and interruption of limitation period.

9.11 Once time has begun to run, it will run continuously but

time ceases to run when the plaintiff commences legal proceedings

in respect of the cause of action in question. It is a general principle

Page 47 of 49 of some importance that bringing an action stops running of time

for the purpose of that action only [Andrew McGee, Limitation

Periods, 4th Edn., Sweet & Maxwell, chapter 2, para1]. The Indian

law also follows the English law [James Skinner vs. Kunwar

Naunihal Singh, ILR (1929) 51 All 367, (PC)]. Intervention of

court in proceedings would prevent the period of limitation from

running and date of courts’ final order would be the date for start

of limitation [N Narasimhiah vs. State of Karnataka, (1996) 3

SCC 88].

[Source: Tagore Law Lectures, U N Mitra, Law of Limitation and Prescription, Sixteenth Edition, Volume 1, Sections 1-32 & Articles 1-52]

9.12 Applying the aforesaid dictum to the facts of the present

case, it is observed that the respondent/plaintiff had filed the suit

for specific performance of the agreement to sell dated 26.04.1991

in the year 1993 itself. The plaint in the said suit was rejected on

12.01.1998. The plaintiff could have filed the second suit on or

before 12.01.2001 as it got right to file the suit on 12.01.1998 on

the rejection of the plaint in the earlier suit filed by it. This is on

the basis of Order VII Rule 13 of the Code. However, the limitation

period expired in January, 2001 itself and the second suit was filed

belatedly in the year 2007. The cause of action by then faded and

Page 48 of 49 paled into oblivion. The right to sue stood extinguished. The suit

was barred in law as being filed beyond the prescribed period of

limitation as per Article 113 to the Schedule to the Limitation Act.

Hence the second suit is barred under Order VII Rule 11(d) of the

Code. We therefore have no hesitation in rejecting the plaint in O.S

No.49/2007 filed by the respondent herein even in the absence of

any evidence being recorded on the issue of limitation. This is on

the admitted facts. Thus, on the basis of Order VII Rule 11(d) of

the Code read with Article 113 of the Limitation Act by setting aside

the impugned orders of the High Court and the trial court and by

allowing the application filed under Order VII Rule 11(d) of the

Code. Consequently, this appeal is allowed.

Parties to bear their respective costs.

. . . . . . . . . . . . . . . . . . . . . . . . . . . J.

(B.V. NAGARATHNA)

. . . . . . . . . . . . . . . . . . . . . . . . . . . J.

(NONGMEIKAPAM KOTISWAR SINGH) NEW DELHI;

JANUARY 08, 2025.

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