Urvashiben vs Krishnakant Manuprasad Trivedi

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS. OF 2018 [Arising out of S.L.P.(C)Nos.23062-23063 of 2018]

Urvashiben & Anr. ... Appellants

Versus

Krishnakant Manuprasad Trivedi ... Respondent

J U D G M E N T

R. Subhash Reddy, J.

1. Leave granted.

2. These civil appeals are preferred by the defendants in

Civil Suit No.930 of 2017, on the file of the City Civil

Court, Ahmedabad, aggrieved by the judgment and decree of

the High Court of Gujarat dated 10.07.2018 passed in Regular

First Appeal No.160 of 2018 and Civil Application No.1 of

2018.

3. The respondent-plaintiff has filed Civil Suit No.930

of 2017 for specific performance of the Agreement to Sell

dated 13.03.1992 with regard to suit schedule property, i.e.

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Final Plot No.147 of Town Planning Scheme No.3 of Mouje

Shekhpur-Khanpur of Ahmedabad, admeasuring 2821 Sq.Mtrs. It

is the case of the plaintiff that the predecessor-in-title

of the appellant-defendants, one Chaitanyabhai Patel, had

agreed to sell the suit schedule property to him and execute

Agreement of Sale / Sale Deed for a sale consideration of

Rs.32 lacs. The total consideration amount of Rs.32 lacs

was paid during the period from 15.01.1990 to 05.09.1991.

It is stated that such payments are acknowledged by

vouchers. It was the case of the respondent-plaintiff that,

time was not the essence of the contract, and citing

financial problems, the Sale Deed was not executed. It is

alleged that deceased Chaitanyabhai Patel has given trust

and belief that he will execute the Sale Deed. However,

recently when the respondent-plaintiff had visited the suit

schedule property on 25.05.2017 he has come to know that the

said property was sold to third party in view of increase in

prices. It is alleged in the plaint that the appellant-

defendants have expressed that they will not execute the

Sale Deed. Hence, the suit is filed.

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4. In the aforesaid suit, the appellant-defendants have

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

Civil Procedure (CPC) to reject the plaint on the ground

that suit is barred by limitation. The said application was

contested by the respondent herein. However, trial court,

by order dated 27.12.2017, allowed the application and

ordered to reject the plaint.

5. As against the same, respondent-plaintiff preferred

Regular First Appeal No.160 of 2018 before the High Court of

Gujarat at Ahmedabad. By the judgment and decree dated

10.07.2018, the High Court has allowed the appeal filed by

the respondent by setting aside the order of the trial court

dated 27.12.2017. As against the same, these civil appeals

are filed.

6. We have heard Sri Anshin H. Desai, learned senior

counsel for the appellants and Sh. Dushyant Dave, learned

senior counsel for the respondent-plaintiff.

7. In these appeals, it is contended by Sri Desai,

learned senior counsel appearing for the appellants that the

alleged Agreement to Sell is dated 13.03.1992 and the suit

is filed in the year 2017, i.e., after a period of 25 years

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and even according to the case of the respondent-plaintiff

there is no communication at all in between the period from

1992 to 2017. It is submitted that except stating that he

had visited the site on 25.05.2017 on which date he has come

to know the said plot is sold to third parties, there is

nothing on record to show that the suit is within

limitation. Referring to Article 54 of the Limitation Act,

1963 it is contended by learned counsel that even in absence

of prescribing time for executing the Sale Deed, the period

of three years is to be computed from the date of refusal.

It is submitted that by waiting for a period of 25 years and

by merely stating that he had visited the site on 25.05.2017

on which date, the appellants have refused to execute the

Sale Deed, such a suit is filed. It is submitted that the

suit filed is frivolous, vexatious and ex-facie barred by

limitation. It is contended that even in absence of fixing

any period for executing the Sale Deed, it is not open to

respondent-plaintiff to file the suit after 25 years of

alleged Sale Deed / Agreement to Sell. It is further stated

that the so-called Agreement to Sell is unregistered one,

not supported by any payments through cheque. Vaguely

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stating that entire amount of consideration is paid, by way

of cash during the period from 15.01.1990 to 05.09.1991, the

said suit is filed. It is contended by learned counsel that

a well reasoned order passed by the trial court is set aside

by the High Court without recording any justifiable reasons.

In support of his case for rejection of plaint under O.VII

R.11, learned counsel has placed reliance on judgment of

this Court in the case of Prabhakar v. Joint Director,

Sericulture Department & Anr.1; T. Arivandandam v. T.V.

Satyapal & Anr.2; Hardesh Ores (P) Ltd. v. Hede & Co.3;

Dilboo (Smt.) (Dead) by LRs & Ors. v. Dhanraji (Smt.) (Dead)

& Ors.4; I.T.C. Limited v. Debts Recovery Appellate Tribunal

& Ors.5; Raj Narain Sarin (Dead) through LRs. & Ors. V.

Laxmi Devi & Ors.6; N.V. Srinivasa Murthy & Ors. v.

Mariyamma (Dead) by Proposed LRs. & Ors. 7; Madanuri Sri Rama

Chandra Murthy v. Syed Jalal8 and in the case of Church of

Christ Charitable Trust & Educational Charitable Society v.

Ponniamman Educational Trust9.

1 (2015) 15 SCC 1 2 (1977) 4 SCC 467 3 (2007) 5 SCC 614 4 (2000) 7 SCC 702 5 (1998) 2 SCC 70 6 (2002) 10 SCC 501 7 (2005) 5 SCC 548 8 (2017) 13 SCC 174 9 (2012) 8 SCC 706

5 C.A.@ SLP(C)Nos.23062-63/18

8. On the other hand Sh. Dushant Dave, learned senior

counsel appearing for the respondent has submitted that the

appellant-defendants sought rejection of the plaint under

O.VII R.11(d) of the CPC only on the ground that suit is

barred by limitation. It is the contention by the learned

counsel that undisputedly time was not the essence of the

contract, in which event as per Article 54 of the Limitation

Act 1963, the period of limitation is three years from the

date of refusal. It is submitted that the limitation being

a mixed question of fact and law, whether the suit is filed

within a period of three years from the date of refusal, is

a triable issue, which can be adjudicated only after trial

but same is no ground for rejection of the plaint at this

stage. It is submitted that for the purpose of considering

the application under O.VII R.11(d), plain averments in the

plaint are to be seen and no other ground can be a ground

for rejection of the plaint, under O.VII R.11(d). It is

submitted that whether, from the averments in the plaint in

a given case, plaint is to be rejected or not under O.VII

R.11, is to be considered with reference to facts of each

case and from the case on hand, it cannot be said that suit

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is barred by limitation, only by looking at the averments in

the plaint. Learned counsel has contended that all the

citations by learned counsel for the appellants are not

applicable to the facts of the case on hand and, in support

of his arguments, reliance is placed in the case of

Gunwantbhai Mulchand Shah & Ors. v. Anton Elis Farel &

Ors.10; Rathnavathi & Anr. v. Kavita Ganashamdas11; Madina

Begum & Anr. v. Shiv Murti Prasad Pandey & Ors.12 and

Chhotanben & Anr. v. Kiritbhai Jalkrushnabhai Thakkar &

Ors.13.

9. Having heard learned counsel on both sides, we have

perused the order passed by the trial court as well as the

High Court and other material placed on record.

10. The trial court has allowed the application filed by

the appellant-defendants, by holding a finding that

respondent-plaintiff, by clever drafting, has created

illusion of cause of action and stated that cause of action

has arisen on 25.05.2017, but he failed to give justifiable

explanation for unreasonable delay in filing the suit.

Trial court further held that when the plaintiff has not 10 (2006) 3 SCC 634 11 (2015) 5 SCC 223 12 (2016) 15 SCC 322 13 (2018) 6 SCC 422

7 C.A.@ SLP(C)Nos.23062-63/18

taken any action for 25 years, by clever drafting, the

plaintiff cannot bring an action within the period of

limitation. Therefore, it has held that suit being barred

by limitation, attracts rejection under O.VII R.11(d) of

CPC. The High Court has set aside the order of the trial

court by recording a finding that going by the plain

averments in the suit, it cannot be stated that the same is

barred by limitation.

11. It is fairly well settled that, so far as the issue of

limitation is concerned, it is a mixed question of fact and

law. It is true that limitation can be the ground for

rejection of plaint in exercise of powers under O.VII

R.11(d) of the CPC. Equally, it is well settled that for

the purpose of deciding application filed under O.VII R.11

only averments stated in the plaint alone can be looked

into, merits and demerits of the matter and the allegations

by the parties cannot be gone into. Article 54 of the

Limitation Act, 1963 prescribes the limitation of three

years, for suits for specific performance. The said Article

reads as under :

Suits for Specific 3 years The date fixed for the Performance performance, or, if no

8 C.A.@ SLP(C)Nos.23062-63/18

such date is fixed, when the plaintiff has notice that performance is refused

12. From a reading of the aforesaid Article, it is clear

that when the date is fixed for performance, limitation is

three years from such date. If no such date is fixed, the

period of three years is to be computed from the date when

the plaintiff, has notice of refusal. When rejection of

plaint is sought in an application filed under O.VII R.11,

same is to be considered from the facts of each case,

looking at the averments made in the plaint, for the purpose

of adjudicating such application. As averred in the plaint,

it is the case of the plaintiff that even after payment of

the entire consideration amount registration of the document

was not made and prolonged on some grounds and ultimately

when he had visited the site on 25.05.2017 he had come to

know that the same land was sold to third parties and

appellants have refused performance of contract. In such

event, it is a matter for trial to record correctness or

otherwise of such allegation made in the plaint. In the

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suits for specific performance falling in the second limb of

the Article, period of three years is to be counted from the

date when it had come to the notice of the plaintiff that

performance is refused by the defendants. For the purpose

of cause of action and limitation when it is pleaded that

when he had visited the site on 25.05.2017 he had come to

know that the sale was made in favour of third parties and

the appellants have refused to execute the Sale Deed in

which event same is a case for adjudication after trial but

not a case for rejection of plaint under O.VII R.11(d) of

CPC.

13. Counsel for the appellants has placed reliance on the

judgment in the case of Prabhakar (supra). In the above said

case, this Court has held that, even where no limitation

period is prescribed by the Statute, courts apply doctrine

of delay/laches/acquiescence and non-suit litigants who

approach court belatedly without justifiable explanation.

Delay and laches are to be examined with reference to facts

of each case and the said judgment is not helpful to support

the case of the appellant inasmuch as this matter arises out

of an application filed under O.VII R.11(d) of the CPC. The

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judgment in the case of T. Arivandandam (supra) pertains to

eviction from tenanted premises which was contested by the

tenant. In the said case where rejection of plaint under

O.VII R.11(d) was considered on the ground that plaint does

not disclose cause of action but not a case for rejection of

plaint on the ground of limitation. In the case of Hardesh

Ores (supra) it was the case falling in the first limb of

Article 54 of the Limitation Act 1963 but not a case falling

under second limb, where the time is not the essence of the

contract. In the judgment in the case of Dilboo (Dead)

(supra) this Court has considered relevant principles of

applicability of O.VII R.11 of CPC. Equally, the case of

I.T.C. Limited (supra) is a case concerning rejection of

plaint under O.VII R.11(a) but not case of rejection on the

ground of limitation. In the case of Raj Narain Sarin

(supra) the suit was filed after 40 years after execution of

the Sale Deed and as a fact it was found that Sale Deed was

to the knowledge of the plaintiff and he had not taken any

steps to declare the Sale Deed invalid. In that context,

the order passed under O.VII R.11 was confirmed by this

Court. In the case of N.V. Srinivasa (supra) the suit is

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for declaration but not for specific performance and in the

said suit having regard to the facts of the case this Court

has held that suit for declaration filed by the plaintiff is

not maintainable. In the case of Madanuri Rama (supra) the

suit was filed seeking cancellation of Sale Deed on the

ground that property in question is a waqf property which

cannot be sold to a private party. The aforesaid case is a

case not concerning limitation under Article 54 of the

Limitation Act 1963.

14. On the other hand, judgment in the case Gunwantbhai

(supra) this Court has held as under :

“8. We may straightaway say that the manner in which the question of limitation has been dealt with by the courts below is highly unsatisfactory. It was rightly noticed that the suit was governed by Article 54 of the Limitation Act, 1963. Then, the enquiry should have been, first, whether any time was fixed for performance in the agreement for sale, and if it was so fixed, to hold that a suit filed beyond thre years of the date was barred by limitation unless any case of extension was pleaded and established. But in a case where no time for performance was fixed, the court had to find the date on which the plaintiff had notice that the performance was refused and on finding that date, to see whether the suit was filed within three years thereof. We have explained the position in the recent decision in R.K. Parvtharaj Gupta v. K.C. Jayadeva Reddy (2002) 2 SCC 428. In the case on hand, there is no dispute that no date for performance is fixed in the agreement and if

12 C.A.@ SLP(C)Nos.23062-63/18

so, the suit could be held to be barred by limitation only on a finding that the plaintiffs had notice that the defendants were refusing performance of the agreement. In a case of that nature normally, the question of limitation could be decided only after taking evidence and recording a finding as to the date on which the plaintiff had such notice. We are not unmindful of the fact that a statement appears to have been filed on behalf of the plaintiffs that they did not want to lead any evidence. The defendants, of course, took the stand that they also did not want to lead any evidence. As we see it, the trial court should have insisted on the parties leading evidence on this question or the court ought to have postponed the consideration of the issue of limitation along with the other issues arising in the suit, after a trial.”

In the aforesaid case, it is clearly held that in cases

falling in second limb of Article 54 finding can be recorded

only after recording evidence. The said view expressed by

this Court supports the case of the respondent-plaintiff.

In the judgment in the case of Rathnavathi (supra) in

paragraphs 42 and 43 it was clearly held that when the time

is not fixed in the agreement, the limitation of three years

to file a suit for specific performance would begin when the

plaintiff has noticed that defendant has refused the

performance of the agreement. In the judgment in the case

of Ahmadsahab Abdul Mulla(2)(Dead) by Proposed LRs. v.

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Bibijan & Ors.14 while interpreting Article 54 of the

Limitation Act, it is held that words “date fixed for the

performance” is a crystallised notion. The second part

“time from which period begins to run” refers to a case

where no such date is fixed. In the case of Balsaria

Construction (P) Ltd. v. Hanuman Seva Trust & Ors.15 and

Chhotanben (supra) this Court clearly held that issue of

limitation, being a mixed question of fact and law, is to be

decided only after evidence is adduced.

15. By applying the aforesaid principles in the judgments

relied on by Sri Dushyant Dave, learned senior counsel

appearing for the respondent, we are of the considered view

that merits and demerits of the matter cannot be gone into

at this stage, while deciding an application filed under

O.VII R.11 of the CPC. It is fairly well settled that at

this stage only averments in the plaint are to be looked

into and from a reading of the averments in the plaint in

the case on hand, it cannot be said that suit is barred by

limitation. The issue as to when the plaintiff had noticed

refusal, is an issue which can be adjudicated after trial.

14 (2009) 5 SCC 462 15 (2006) 5 SCC 658

14 C.A.@ SLP(C)Nos.23062-63/18

Even assuming that there is inordinate delay and laches on

the part of the plaintiff, same cannot be a ground for

rejection of plaint under O.VII R.11(d) of CPC.

16. For the aforesaid reasons, we do not find any

illegality in the judgment of the High Court, so as to

interfere with the same in these appeals. Accordingly,

these appeals are dismissed, being devoid of merit, with no

order as to costs. We make it clear that we have not

expressed any opinion on the merits of the matter, including

on the issue of limitation. It is open for the trial court

to frame issues, including the issue of limitation, and

decide the matter on its own merits. As the alleged

agreement is of the year 1992, trial court to dispose of the

suit, as expeditiously, as possible.

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

[Uday Umesh Lalit]

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

[R. Subhash Reddy] New Delhi December 14, 2018

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