Case Note & Summary
The appellant, M/s. Everhome Properties Pvt. Ltd., filed a suit for specific performance of an agreement for sale dated 15.07.2019 against the respondents, M/s. Aditya Developers and others. The agreement was for the sale of a flat in a building to be constructed by the respondents. The appellant paid the entire consideration of Rs. 1,10,00,000/-. The respondents failed to execute the sale deed. The respondents filed an application under Order VII Rule 11 CPC for rejection of the plaint, arguing that the agreement was not a concluded contract but merely an offer, and that the plaint did not disclose a cause of action. The trial court dismissed the application. The respondents appealed. The High Court held that the agreement, though titled as an 'offer', was a continuous offer which, upon acceptance by the appellant and payment of the entire consideration, became a binding contract. The plaint disclosed a cause of action, and the appellant had pleaded readiness and willingness. The court dismissed the appeal, upholding the trial court's order.
Headnote
A) Civil Procedure - Rejection of Plaint - Order VII Rule 11 CPC - Cause of Action - The court considered whether the plaint disclosed a cause of action for specific performance of an agreement for sale - Held that the agreement, though termed as an 'offer', was a continuous offer accepted by the plaintiff's conduct and payment of consideration, and the plaint disclosed a cause of action - Rejection of plaint was not warranted (Paras 1-10). B) Specific Relief - Agreement for Sale - Concluded Contract - Section 16(c) Specific Relief Act, 1963 - The court examined whether the agreement was a concluded contract or merely an offer - Held that the agreement was a continuous offer which, upon acceptance by the plaintiff and payment of the entire consideration, became a binding contract - The plaintiff's readiness and willingness was pleaded (Paras 5-8). C) Civil Procedure - Rejection of Plaint - Order VII Rule 11 CPC - Demurrer - The court reiterated that for rejection of plaint, only the plaint averments are to be considered, and if a cause of action is disclosed, the plaint cannot be rejected - The court found that the plaint disclosed a cause of action and the application for rejection was rightly dismissed (Paras 9-10).
Issue of Consideration
Whether the plaint in a suit for specific performance of an agreement for sale is liable to be rejected under Order VII Rule 11 CPC on the ground that the agreement was not a concluded contract but merely an offer, and whether the plaintiff had failed to disclose a cause of action.
Final Decision
The High Court dismissed the appeal, upholding the trial court's order rejecting the application under Order VII Rule 11 CPC. The court held that the plaint disclosed a cause of action and the agreement was a continuous offer that became a binding contract upon acceptance and payment.
Law Points
- Order VII Rule 11 CPC
- Specific Relief Act 1963
- Section 16(c)
- Section 20
- Agreement for Sale
- Cause of Action
- Rejection of Plaint
- Concluded Contract
- Continuous Offer
- Readiness and Willingness
