Case Note & Summary
The appellant, original plaintiff, filed a suit for specific performance of an Agreement for Sale dated 19/01/2010 for a compensation pool property in Ulhasnagar. The plaintiff paid Rs.36,98,000/- out of total consideration of Rs.1,08,00,000/-. The agreement did not fix a time for performance; it was contingent on the defendants obtaining a conveyance deed from the government. The plaintiff alleged that the defendants delayed and intended to sell to others, leading to a legal notice on 14/05/2014 and suit on 09/06/2014. The trial court dismissed the suit on limitation and on merits. The High Court upheld the dismissal, holding that the agreement was a contingent contract and not specifically enforceable until the conveyance deed was issued. The court also found that the suit was barred by limitation as the plaintiff failed to act within a reasonable time. The appeal was dismissed.
Headnote
A) Limitation - Specific Performance - Reasonable Time - Article 54 Limitation Act, 1963 - Where no time for performance is fixed, the suit must be filed within three years from the date when the plaintiff has notice that performance is refused - In the present case, the agreement dated 19/01/2010 did not fix a time for performance; the plaintiff paid part consideration and waited for the defendants to obtain a conveyance deed from the government - The defendants refused performance by their written statement in 2014, but the suit filed on 09/06/2014 was held to be within limitation as the refusal was in May 2014 - However, the court found that the agreement was contingent on the issuance of conveyance deed, which was uncertain, and thus the suit was not maintainable (Paras 1-10). B) Contract - Contingent Contract - Specific Performance - Section 31 Indian Contract Act, 1872 - An agreement to sell property contingent on the happening of an uncertain event (issuance of conveyance deed by government) is a contingent contract and cannot be specifically enforced until the event occurs - The court held that the agreement was not an absolute contract for sale but a conditional one, and since the conveyance deed was not issued, the plaintiff could not seek specific performance (Paras 11-20). C) Limitation - Specific Performance - Article 54 Limitation Act, 1963 - The period of limitation for specific performance is three years from the date fixed for performance, or if no such date, from the date when the plaintiff has notice that performance is refused - In this case, the plaintiff had notice of refusal when the defendants filed their written statement in 2014, but the suit was filed within three years from that date - However, the court held that the suit was barred by limitation because the plaintiff failed to show readiness and willingness within a reasonable time (Paras 21-30).
Issue of Consideration
Whether the suit for specific performance of an agreement for sale is barred by limitation when no time for performance is fixed, and whether the agreement is enforceable given the contingent nature of the obligation.
Final Decision
Appeal dismissed. The judgment of the Trial Court dated 29/12/2025 dismissing Special Civil Suit No. 165 of 2014 is upheld. Interim Application No.13477 of 2025 disposed of.
Law Points
- Specific performance
- Limitation
- Contingent contract
- Reasonable time
- Compensation pool property
- Agreement for Sale
- Section 54 Transfer of Property Act
- Section 20 Specific Relief Act
- Article 54 Limitation Act
