Open iDraf
P. Sivan Muthiah And Others v. John Sathiavasagam

P. Sivan Muthiah And Others
v.
John Sathiavasagam

(High Court Of Judicature At Madras)

No. | 23-01-1990


1. The plaintiff in O.S.No. 75 of 1978 on the file of the Subordinate Judge, Madurai are, the appellants in this appeal. The respondent is the defendant in the suit. 2. The plaintiffs laid the suit for specific performance of two agreements of sale in respect of immovable items, both dated 7.11.1973 and marked in the case as Exs.A1 and A2. The plaintiffs themselves were in possession of the properties as tenants under the defendant. Under Ex.A.1 an advance of Rs. 9,000 was paid and under Ex.A2 an advance of Rs. 6,000 was paid. There was a further payment of Rs. 3,500 under Ex.A3 and there is a controversy as to whether it was towards the sale agreements. There were other tenants in the properties and it was stipulated in the sale agreements Exs.A.1 and A2 that on the defendant evicting the tenants and giving notice through registered post to the plaintiffs with regard to delivery of vacant possession, the plaintiffs shall complete the sale within three months from the date of the receipt of the notice. The plaintiffs laid the suit for specific performance even though the tenants did not get evicted. The suit had come to be laid on 23.1.1978. 3. The defendant contested the suit mainly saying that it was barred by limitation. There were other aspects of contest by the defendant and we need not trouble ourselves with them since the concentration on the question of limitation will primarily be decisive, with regard to the relief of specific performance claimed by the plaintiffs. 4. The Court below formulated the relevant issues on the pleadings put forth by the parties, and after the parties placed their evidence oral and documentary, assessed it and the Court below held that the suit was barred by limitation. The plaintiffs in the alternative have also asked for refund of the monies paid by them pursuant to the agreements of sale and this relief was also negatived to the plaintiffs on the ground of limitation. That is how the plantiffs have come to prefer this appeal. 5. Mr. A. Ramanathan, learned Counsel for the plaintiffs would first plead for countenancing the prayer of his clients for specific performance of the sale agreements Exs.A.1 and A.2. There is a counter plea by Mr. P. Ananthakrishnan Nair, learned Counsel appearing for the defendants stating that the suit for specific performance is barred by limitation. The Article in the Limitation Act, 1963 that is applicable to a suit of the present nature is Article 54. The time stipulated is three years where there is a date fixed for the performance. If on the other hand no date is fixed the time is three years when the plaintiff has notice that performance is refused. The endeavour of Mr. A. Ramanathan, learned Counsel for the plaintiffs was to bring the case on hand within the first part viz., three years from the date fixed for performance. According to the learned Counsel for the plaintiffs, time will run only on the defendant evicting the tenants in occupation of the properties and giving notice through registered post to the plaintiffs about the possibility of giving vacant possession, and the plaintiffs are bound to fulfil their obligations under the sale agreements Exs.A1 and A2 from three months after the receipt of such notice. The learned Counsel for the plaintiffs wants us to construe this clause in the sale agreements Exs.A1 and A2 as amounting to fixing a date for performance, and compute the time for specific performance on the basis. From the above recitals in Exs.A1 and A2 it is not possible to say that a definite date was fixed for the performance of the contract so that the three years period could be computed therefrom. This part of Article 54 could be invoked only when there is a definite date fixed for performing the contract. It is true that the expression "date fixed" could mean either the date expressly fixed or the date which can be fixed with reference to a future event, which is certain to happen. If on the other hand, the date is to be ascertained depending upon an event which is not certain to happen, this part of Article 54 is not at all applicable. In that contingency it is only the latter part of Article 54 that could be invoked treating the case as one in which no date has been fixed for performance and that would be three years from the date when the plaintiff has notice that performance is refused. The event of evicting the tenants in occupation and keeping vacant possession for delivery was an uncertain one. It was not one, which was certain to happen. Hence in the present case, time for specific performance must be deemed to have run from the date when plaintiffs had notice that performance was refused by the defendant. 6. However, Mr. A. Ramanathan, learned Counsel for the plaintiffs would say that in the present case there was no categoric refusal on the part of the defendant to perform the contract in earlier days and time could not be stated to have run against the plaintiffs, with regard to filing of the suit even on this basis. Then the question is when the plaintiffs had notice that performance was refused by the defendant. In this connection, Mr. P. Ananthakrishnan Nair, learned Counsel for the defendant drew out attention to the exchange of correspondences between the parties. In Ex.B1 dated 18.6.1975 addressed to the first plaintiff the defendant speaks about the cancellation of the sale agreements and calls upon the first plaintiff to enter into a new lease agreement. In Ex.A4 dated 20.6.1974 the defendant complains about the delay on the part of the first plaintiff with regard to the performance of the sale agreements and warns that the advances paid will be forfeited if there is no acting upon by the plaintiffs within three days of that letter. These letters certainly indicate the disinclination of the defendant to keep alive the sale agreements. The matter does not stop there. The defendant initiated proceedings for eviction under the Tamil Nadu Act 18 of 1960 against the plaintiffs who are in occupation of the suit, properties. Certainly this does not go in consonance with the case of the plaintiffs that after the sale agreements Exs.A1 and A2 their possession was not that of tenants but was only under the sale agreements. The defendant had taken up cudgels against the plaintiff to evict them as tenants and the defendant had not minced matters and expressed the definite stand to put an end to the sale agreements. The eviction proceedings got initiated in 1973-74 as could be seen from Exs.A11 and A.14. Hence we have to take it that at least in 1974 the defendant resiled from the sale agreements and time must run from then onwards. If so run the suit laid in 1978 for specific performance was certainly out of time. 7. Mr. A. Ramanathan, learned Counsel for the plaintiffs would then plead that the plaintiffs ought to have been granted the alternative reliefs of refund of the moneys paid by them. The Court below was under the impression that the same time limit for specific performance of an agreement of sale would be applicable for the recovery of the advances paid, and in this view, denied the plaintiffs even that relief. Now, there is a consensus before us that the Article of the Limitation Act 1963 that could be invoked is Article 47. That Article speaks about recovery of money paid upon an existing consideration which afterwards fails and the time stipulated is three years from the date of the failure. Then the question is as to when we should hold that the consideration in the present case failed. In this connection Mr. A. Ramanathan, learned Counsel for the plaintiffs drew our attention to the pronouncement in Udit Narain v. Muhammad Minnat-Ulla (1903) I.L.R. 25, Allahabad 618 where it has been opined that limitation will begin to run only from the date of the High Courts Decree declaring that the agreement to sell is unenforceable. The earlier pronouncement in Dassu Kuar v. Dhum Singh (1988) I.L.R.11, All.47 was followed. That is the proposition that should govern the present case also. Only on the plaintiffs failing to get specific performance as claimed by them it can be said that the consideration for the sale agreements failed. If so viewed the relief of refund could not be stated to have become barred. Hence we cannot subscribe our support to the view of the Court below that the plaintiffs are not entitled to refund of the advance paid. 8. With regard to the quantum of the advances paid there is no dispute with reference to the amounts covered by Exs.A1 and A2. The controversy, as we pointed out earlier, is only with reference to the sum of Rs. 3,500 paid under Ex.A3. The defendant would say that the said amount was paid by way of pagadi for evicting a tenant in the properties concerned. But Ex.A3 by its terms is unambiguous and it speaks only about the sale agreements and the total advance of Rs. 15,000 paid thereunder and it speaks about the further payment of Rs. 3,500 and the time being extended in respect of the sale agreements. There is no reference to any pagadi in this document. We are not able to agree with the finding of the Court below that the payment under Ex.A3 was not towards the sale agreements. Hence it can be taken that the total amounts paid towards the sale agreements by the plaintiffs was Rs. 18,500. This the plaintiffs are entitled to get from the defendant. 9. Then the question arises as to from what date the defendant should be mulcted with interest at an appropriate rate. There was a refusal to grant specific performance by the Court below by its decree dated 31.7.1980. By this Judgment of ours we are confirming that decree. We think that the award of interest must relate to the date of the decree of the Court below viz., 31.7.1980. Concerning the rate of interest it would be reasonable and just that a uniform rate of 6 per cent per annum is awarded. 10. Accordingly we allow this appeal to the following extent: (i) The plaintiffs are granted a decree for a sum of Rs. 18,500 with interest thereon at 6 per cent per annum from 31.7.1980 till the date of payment; (ii) Considering the nature of the litigation, we direct the parties to bear their costs throughout; (iii) The judgment and decree of the Court below will stand reversed to the above extent and in other respects the same will stand confirmed.

Advocates List

For the Appearing Parties -----------------

For Petitioner
  • Shekhar Naphade
  • Mahesh Agrawal
  • Tarun Dua
For Respondent
  • S. Vani
  • B. Sunita Rao
  • Sushil Kumar Pathak

Bench List

HON'BLE MR. JUSTICE NAINAR SUNDARAM

Eq Citation

(1990) 1 MLJ 490

LQ/MadHC/1990/74

HeadNote