Case Note & Summary
The appellant, M/s. Rajendra Trading Company, a registered partnership firm, filed a suit for specific performance of an agreement dated 01.08.2014 with M/s. S.P. Builders and others for purchase of a shop. The agreement stipulated a total consideration of Rs. 50 lakhs, of which Rs. 10 lakhs was paid as earnest money. The balance was to be paid at the time of execution of the sale deed. The plaintiff alleged that despite repeated requests, the defendants failed to execute the sale deed and eventually refused to perform by letter dated 15.03.2017. The plaintiff filed the suit on 14.03.2020. The trial court dismissed the suit as barred by limitation, holding that the date fixed for performance was 01.08.2015 (one year from agreement) and the suit was filed beyond three years. The appellate court affirmed. In appeal, the High Court examined Article 54 of the Limitation Act, 1963, which provides that for specific performance, limitation is three years from the date fixed for performance, or if no such date is fixed, from the date of notice of refusal. The court found that the agreement did not fix a specific date for performance; it only mentioned that the sale deed would be executed within a reasonable time. The court held that the date of refusal was 15.03.2017, and the suit filed on 14.03.2020 was within three years. The court also held that the plaintiff had pleaded readiness and willingness and had deposited the balance amount in court, satisfying Section 16(c) of the Specific Relief Act. The court allowed the appeal, set aside the lower courts' judgments, and decreed the suit for specific performance.
Headnote
A) Limitation Act - Article 54 - Suit for Specific Performance - Date Fixed for Performance - Where a date is fixed for performance, limitation runs from that date; where no date is fixed, from notice of refusal - The court held that the agreement did not fix a specific date for performance, and the plaintiff filed suit within three years of the defendant's refusal to perform - Held that the suit was within limitation (Paras 10-15). B) Specific Relief Act, 1963 - Section 16(c) - Readiness and Willingness - Plaintiff must plead and prove continuous readiness and willingness to perform - The court found that the plaintiff had averred readiness and willingness and had deposited the balance consideration in court - Held that the plaintiff satisfied the requirement (Paras 16-20). C) Limitation Act, 1963 - Article 54 - Notice of Refusal - Refusal must be clear and unequivocal - The court noted that the defendant's letter dated 15.03.2017 constituted a clear refusal to perform - Held that limitation began from that date (Paras 12-14).
Issue of Consideration
Whether the suit for specific performance was barred by limitation under Article 54 of the Limitation Act, 1963, and whether the plaintiff was ready and willing to perform his part of the contract.
Final Decision
Appeal allowed. Judgment and decree of trial court and appellate court set aside. Suit for specific performance decreed. Defendants directed to execute sale deed within three months on payment of balance consideration.
Law Points
- Specific performance
- Limitation Act
- Article 54
- date fixed for performance
- notice of refusal
- readiness and willingness
- part performance
- equitable relief
