Saturday, 28 May 2016

When suit for specific performance of contract will be barred by limitation?

The second submissions made by the learned Counsel appearing
on   behalf   of   plaintiffs   about   the   limitation.     He   submits   that   the
Appellate Court erred in coming to a conclusion that the suit filed by
the plaintiffs was barred by the limitation.  Admittedly, in the present

proceeding,   the   plaintiffs   relied   on   the   subsequent   agreement   for
reconveyance dated 29.06.1986.   This itself shows that plaintiffs had
knowledge that the defendants were not ready and willing to reconvey
the   suit   property   therefore,   the   plaintiff   should   have   filed   the   suit
within   three   years   from   the   said   refusal   by   the   defendants.     The
plaintiffs had filed the suit on 28.12.2002.  Hence, the Appellate Court
in paragraph 55 of the impugned decree rightly held that the suit filed
by the plaintiffs was barred by limitation.
IN THE HIGH COURT OF  JUDICATURE AT BOMBAY.
CIVIL APPELLATE JURISDICTION.
SECOND APPEAL NO.   161  OF   2013
WITH
CIVIL APPLICATION NO.  502  OF   2013
 Shri. Nanda @ Sadanand Dattu Barmukh 
Vs
Shri. Chhotubhai Kasambhai Inamdar 
CORAM : K. K. TATED, J.
DATED   : 04/09/2015.
Citation; 2016(2) ALLMR162

 Heard learned Counsel for the  appellants and learned Senior
counsel for the respondents.
2 This Second Appeal is preferred by the plaintiffs challenging the
decree dated 06.03.2013 passed by learned District Judge­5, Pune in
Civil Appeal No. 520 of 2011 setting aside the decree dated 22.07.2011
passed by the Trial Court in Regular Civil Suit no. 168 of 2002.
3 For the sake of convenience, the nomenclature of the parties will
be   referred   as  stated   in   the   plaint   i.e.   Appellants   as   plaintiffs  and
respondents as defendants.
4 The suit land admeasuring 4 Hectors and 69.4 R out of land Gat
No. 437 situated within the limits of Village Chandkhed,  Taluka Maval,
District Pune was the subject matter of the suit.  The said property was
belonging   to   the   father   of   plaintiff   no.1   namely   Dattu   Narayan
Barmukh.  The suit land being a grass fallow land, the father of plaintiff
no.1 and the plaintiffs agreed to sell the suit land to the defendant for
Rs.6,000/­   and   accordingly,   had   executed   registered   Sale   Deed   on
21.02.1980 before the Sub­Registrar of Maval. 
5 It is the case of the plaintiffs that as per the agreement dated
29.06.1986, the plaintiff no.1 and his father had repaid the amount of
Rs.6000/­ to the defendant who agreed to reconvey the suit land in
favour of plaintiff no.1 and his father and also hand over the possession

of the suit land along with registered Sale Deed dated 21.02.1980
(Exh.28) to the father of plaintiff no.1.  As the defendants failed to act
as per Agreement dated 29.06.1986 for reconveyancing the suit land in
favour of the plaintiff no.1 and his father, the plaintiff filed Regular
Civil   Suit   no.   168   of   2002   for   specific   performance   of   contract,
declaration and permanent injunction against the defendants.   In the
said suit, the Trial Court framed following issues :
ISSUES FINDINGS
1)   Does   plaintiffs   prove   that,
defendant got executed sale deed
dated 21.02.1980 of suit property
in lieu of repayment of arrears of
Rs.6000/­
In the Affirmative. 
2)   Whether plaintiffs prove that
on   29.06.1986   they   repaid   the
amount of Rs.6000/­ to defendant
and on the same date, defendant
got transferred possession of suit
property   to   plaintiffs   by   deed
dated 29.06.1986?
In the Affirmative. 
3)   Whether   plaintiffs   prove   that
defendant is liable to execute the
sale deed of suit property on the
strength   of   deed   dated
29.06.1986?
In the Affirmative. 
4)   Whether   plaintiffs   prove   that
they are owner of suit property by
way of adverse possession?
Redundant
5)   Whether   suit   is   within
limitation?
In the Affirmative. 
6) Whether defendant prove that
plaintiff   no.1   and   father   of
plaintiff   no.2   to   4   themselves
In the Negative.

executed sale deed of suit property
dated 21.02.1980 in his favour, as
he   was   tenant   of   father   of
plaintiffs?
7)   Whether   plaintiff   prove   that
defendant   neglected   to   execute
the sale deed of suit property even
issuing notice dated 20.11.2002?
In the Affirmative. 
8) Whether defendant obstructed
peaceful   possession   of   plaintiffs
over   suit   property   in   November,
2002?
In the Affirmative. 
9) Whether plaintiffs are entitled
for   Specific   Performance   of
Contract?
In the Affirmative. 
10) Whether plaintiffs entitled for
permanent injunction, as sought?
In the Affirmative. 
11) What order and decree? As per final order.
6 The   Trial   Court   by   judgment   and   decree   dated   22.07.2011,
passed a decree directing the defendants to reconvey the suit property
by   executing   the   registered   Sale   Deed   before   the   Sub­Registrar,
Vadgaon, Mavel, Pune in favaour of the plaintiffs.
7 Being aggrieved by the said decree passed by the Trial Court, the
defendants preferred Civil Appeal No.520 of 2011.  In the said Appeal,
the Appellate Court framed the following points for consideration:
POINTS FINDINGS
1) Whether the instrument dated
21.02.1980 styled as sale deed has
been   voluntarily   executed   by
Yes

plaintiff no.1 and his father Dattu
Barmukh   in   respect   of   suit
property for valid consideration?
2) Whether there was written or
oral   agreement   between   plaintiff
no.1, his father and defendant to
reconvey   the   suit   land   on
repayment   of   Rs.6000/­   by
plaintiff no.1 and his father to the
defendant?
No.
3) Whether the agreement dated
29.06.1986   to   reconvey   the   suit
property   by   parting   possession
thereof   has   been   voluntarily
executed   by   the   defendant   for
valid consideration?
No.
4)   Whether   the   defendant   has
handed   over   original   sale   deed
dated 21.02.1980 at Exh.28 to the
plaintiff   no.1   and   his   father   on
29.06.1986   by   agreeing   to
reconvey the suit property? 
No.
5) Whether defendant has caused
obstruction   to   the   possession   of
the   plaintiff   over   the   suit   land
since Nov.2002?
No.
6) Whether defendant has caused
obstruction   to   the   possession   of
the   plaintiff   over   the   suit   land
since Nov. 2002?
No.
7) Whether the suit is barred by
limitation?
No.
8)   Whether   the   plaintiffs   are
entitled   to   a   decree   of   specific
performance of contract in terms
of   the   agreement   dated
29.06.1986?
No.
9) Whether plaintiffs are entitled No.

to   a   decree   of   declaration   and
perpetual injunction?
10)   Whether   the   impugned
Judgment and decree is legal and
enforceable?
No.
11) What order? Appeal   is   allowed   with   costs
throughout.
8 The Appellate Court held that the plaintiffs by instrument dated
21.02.1980 i.e. Sale Deed sold the suit land to the defendants.   The
Appellate   Court   also   held   that   the   plaintiffs   failed   to   prove   the
execution of subsequent alleged agreement dated 29.06.1986 by the
defendants to reconvey the suit property in favour of the plaintiffs.  The
Appellate Court also held that the suit filed by the plaintiffs was barred
by     limitation.   Hence,   the   plaintiffs   preferred   the   present   Second
Appeal.
9 The learned counsel Mr. S. V. Pitre appearing on behalf of the
plaintiffs submits that the impugned decree dated 06.03.2013 passed
by the learned District Judge­5, Pune in Civil Appeal No. 520 of 2011 is
against the justice, equity and conscience and same is liable to be set
aside.   He submits that the Appellate Court failed to consider the fact
that the defendants by subsequent agreement dated 29.06.1986 agreed
to reconvey the suit land in favour of the plaintiffs.   He submits that
even the Appellate Court failed to consider the fact that the plaintiffs
repaid the sum of Rs.6000/­ to the defendants for reconveyance of the
suit land in their favour.  He submits that the Appellate Court erred in
coming to the conclusion that the suit filed by the plaintiffs was barred
by law of limitation.  He further submits that the Appellate Court erred

in coming to the conclusion that the notice issued by the plaintiffs to
the defendants dated 28.11.2002 (Exh.29) was not duly served to the
defendant. 
10 The learned counsel for the  plaintiffs submits that the Appellate
Court erred in formulating the point for determination which was not a
issue  before the Trial Court i.e. about the limitation.  He submits that
the Apex Court in the matter of  Santosh Hajari V/s. Purshottam
Tiwari, reported in (2001)3 SCC 179  held that while reversing the
finding of fact, the Appellate Court must come into close quarters with
the reasoning assigned by the Trial Court and then assign its own
reasons for arriving at a different finding.  He submits that in a matter
in hand, the Appellate Court failed to consider the findings given by the
Trial Court as well as evidence on record at the time of reversing the
decree passed by the Trial Court.  On the basis of this submission, the
learned counsel for the plaintiffs submits that in the interest of justice,
this Hon'ble Court be pleased to set aside the decree passed by the
Appellate Court and maintain the decree passed by the Trial Court
directing the defendants to execute the reconveyance in respect of the
suit property in favour of the plaintiffs.  He submits that if the Appeal is
not allowed, irreparable loss and injury will be caused to the plaintiffs. 
11 On   the   other   hand,   the   learned   Senior   Counsel   Mr.   Y.S.
Jahagirdar appearing on behalf of respondents/defendants vehemently
opposed the present Second Appeal.   He submits that  the Appellate
Court   considered   the   each   and   every   documents   on   record   and
pleadings of the parties and allowed the appeal by setting aside the

decree passed by the Trial Court.  Hence, this Hon'ble Court should not
entertain the present Second Appeal as there is no substantial question
of law arises.  
12 The learned Senior Counsel for the defendants submits that the
father of the plaintiffs executed the Sale Deed dated 21.02.1980 in
respect of the suit land for sum of Rs.6,000/­.   He submits that bare
reading of copy of Sale Deed shows that there is no provision for
reconveyance of the suit land in favour of plaintiff   no.1 and/or his
father.   He submits that the alleged agreement dated 29.06.1986 was
produced by the plaintiff in the year 2002.   He submits that the Sale
deed   dated   21.02.1980   is   the   Sale   Deed   and   not   Sale   Deed   with
condition   to   repurchase.    He   submits   that  the   plaintiff's  father   i.e.
original executant was alive till 1986 and he had never taken any steps
for reconveynace who was the best person to ascertain this.  He submits
that the plaintiffs though pleaded in the pleading that they had issued
the notice dated 28.11.2002 to the defendants by R.P.A.D., but the
same was not served on the defendants.  Neither the plaintiffs proved
the service of the said notice on the defendants nor placed on record
any documentary evidence to that effect.   He submits that plaintiff in
his deposition also admitted that he does not have any knowledge
whether   the  said  notice   dated  28.11.2002   was  duly   served   on   the
defendants or not.   He submits that  the allegation of non receipt of
notice   was   specifically   raised   by   the   defendants   in   their   written
statement.  He submits that plaintiffs with a malafide intention created
the story about the notice dated 28.11.2002 for filing of suit. 
Sneha Chavan 8/14

13 The learned Senior Counsel for the defendants submits that the
Sale   Deed   dated   21.02.1980   was  executed   by  the  plaintiff's  father.
Admittedly, in the said Sale Deed, there is no clause for reconveyance
of the suit land.  He submits that as per clause 58(c) of the Transfer of
Properties Act, mortgage transaction or Sale transaction with condition
to repurchase must be part of the said document.   He submits that
these facts were not considered by the Trial Court properly.  He submits
that  the   Appellate   Court   considered   the   evidence   on   record   and
documents and rightly held that predecessor of the plaintiffs sold the
suit land to the defendants by Sale Deed dated 21.02.1980 without any
condition for repurchase.
14 The   learned   Senior   Counsel   for   the   defendants   relies   on   the
Judgment of the Apex Court in the matter of Vanchalabai Ragunath
Ithape (dead) by Lrs. V/s. Shankarroa Baburao Bhilare (dead) by
Lrs. Reported in 2013(6) Mh. L.J. 80.   In that authority, the Apex
Court held that no transaction shall be deemed to be a mortgage unless
the condition is embodied in the document which effects or purports to
effect the resale.   He relies on paragraph 14 of that judgment which
reads thus:
“14) From   the   perusal   of   the   aforesaid   provisions
especially, section 58(c), it is evidently clear that for the purpose
of bringing a transaction within the meaning of mortgage by
conditional sale' the first condition that the mortgage ostensibly
sells   the   mortgage   property   on   the   condition   that   on   such
payment being made, the buyer shall transfer the property to
the seller. Although there is presumption that the transaction is
a   mortgage   by   conditional   sale   in   cases   where   the   whole
transaction is in one document, but merely because of a term
incorporated in the same document it cannot always be accepted
that the transaction agreed between the parties was a mortgage

transaction.”
15 The learned Senior Counsel for the defendant also relies on the
Judgment of the Apex Court in the matter of  C. Cheriathan V/s. P.
Narayanan reported in 2009(4) Mh. L. J. 732  in which the Apex
Court held that the condition of repurchase should be embodied in the
documents which effects or purports to effect the sale.   Paragraph 8
reads thus:
“8. One of the ingredients for determining the true nature
of transaction, therefore, is that the condition of repurchase
should be embodied in the document which effects or purports to
effect the sale. Indisputably, the said condition is satisfied in the
present case.”
16 The learned Senior Counsel for the defendant submits that  the
Appellate Court also held that the suit filed by the plaintiffs was barred
by   limitation   because   the   plaintiffs   and   their   predecessor   had
knowledge about the Sale Deed executed by them on 21.02.1980 and
they filed the suit on 28.12.2002 i.e. after more than 20 years.   He
submits   that  as   per   Article   54   of   Limitation   Act,   suit   for   specific
performance required to be filed within three years from the date when
the cause occurred.
17 The learned Senior Counsel for the defendants submits that in
the present Second Appeal, the plaintiffs failed to make out any case
for substantial question of law.  He submits that the Apex Court in the
matter of Pakeerappa Rai V/s. Seethamma Hengsu (Dead) by Lrs. &
Ors. reported in (2001)9 SCC 521 held that erroneous finding of fact
even if grave in nature, could not be interfered with the Second Appeal.
Paragraph 2 of the said judgment, reads thus:

“2)Learned   Counsel   appearing   on   behalf   of   the
appellant   urged   that   the   finding   recorded   by   the   first
Appellate Court that auction purchaser was not a stranger to
the suit is based on no evidence on record and inasmuch as
the conclusion arrived at is erroneous and the High Court
committed serious mistake of law in not interfering with the
said finding. Plaintiff Seethamma in her evidence stated about
the nearness of the auction purchaser with other defendants.
It was brought on record that auction purchaser was near to
the husband of Laxmi who was one of the defendants in O.S.
No. 133/1963 which was tried along with the suit out of
which the present appeal arises. The first Appellate Court, on
the basis of the said evidence, came to the conclusion that the
auction purchaser was not a stranger to the suit. Under such
circumstances, it cannot be urged that the conclusion arrived
it by the court below was erroneous. The position would be
different if the High Court has the jurisdiction to reappraise
the evidence. In such a situation the High Court might have
come to a different conclusion. But the High Court in exercise
of power under Section  100  CPC cannot interfere with the
erroneous finding of fact howsoever the gross error seeing to
be. We. therefore, do not find any merit in the contention of
the learned Counsel for the appellant.”
18 On the basis of these submissions, the learned Senior Counsel for
the defendants submits that there is no substance in the present Second
Appeal and same is required to be dismissed summarily. 
19 I heard both the sides at length.   The learned Counsel for the
appellants   placed   on   record   a   copy   of   plaint,   written   statement,
deposition   of   the   parties,   sale   deed   dated   21.02.1980,   copy   of
agreement dated 29.06.1986 and other documents. It is to be noted
that in the present proceeding, the plaintiffs filed Regular Civil Suit No.
168 of 2002 for Specific Performance of Agreement, declaration and
permanent   injunction   against   the   defendants.   Bare   reading   of   the

registered Sale Deed dated 21.02.1980 shows that the plaintiff and his
father sold the suit land to the defendants for an amount of Rs.6000/­
without any condition for repurchase.  Though the plaintiffs relied on
the agreement dated 29.06.1986 by which the defendants agreed to
reconvey the suit land in their favour, that agreement was not admitted
by the defendants.   Even the plaintiffs failed to prove the same by
cogent evidence to show that the said agreement was duly signed by
the defendants. 
20 In order to consider as to whether the document is a document of
mortgage by conditional sale, or is a sale with condition of repurchase,
the distinction between two transactions must be borne in mind.  In the
former case, there is a relationship of debtors and creditors and the
transfer is by way of security for repayment of debt, whereas in the
later case, there is condition of reconveyance in the event the amount
equivalent to the consideration is paid by the vendor to the purchaser.
If the condition of repurchase is contained in a separate deed, the
original sale deed can never be regarded as mortgage in view of the
provisions of Section 58(c) of the Transfer of Property Act, 1882. 
21 It is true that the condition of the repurchase is not contained in
the   document   of   transfer   itself,   but   it   is   contained   in   a   separate
document. The document of transfer cannot be regarded as a mortgage
by a conditional sale, in view of provisions of Section 58(c) of the
Transfer of Property Act, where a condition is contained in a separate
document. The deed of transfer would be regarded as an out­and­out
sale and the condition contained in a separate document would only be

regarded as separate agreement for reconveyance. In that event, the
conditions   for   reconveyance   including   condition   of   time   would   be
required to be strictly complied.   In case of Agreement for Sale of
immovable   property,   time   is   generally   not   an   essence   of   Contract.
However,   the   Agreement   to   reconvey   is   essentially   entered   by   the
purchaser with the vendor in the nature of concession, wherein time
would ordinarily be regarded as an essence of contract.  In that event,
the   original   vendor   would   be   required   to   strictly   comply   with   the
conditions including the condition of time, contained in the agreement
of reconveyance.
22 Admittedly, in the case in hand, there was no provision in the
Sale deed dated 21.02.1980 to reconvey the property to the plaintiffs.
There   was   an   alleged   separate   agreement   dated   29.06.1986.
Therefore, in view of Section 58(c) of the Transfer of Property Act,  in
view of the Judgment of the Apex Court in the matter of Vanchalabai
(supra) and in the matter of C. Cheriathan (Supra), it is crystal clear
that on the basis of sale deed dated 21.02.1980 and the subsequent
agreement dated 29.06.1986, the plaintiffs are not entitled for decree
to direct the defendants to execute the reconveyance in respect of the
suit land in their favour. These facts are properly considered by the
Appellate Court, hence, I do not find any reason to interfere in the well
reasoned order on this point. 
23 The second submissions made by the learned Counsel appearing
on   behalf   of   plaintiffs   about   the   limitation.     He   submits   that   the
Appellate Court erred in coming to a conclusion that the suit filed by
the plaintiffs was barred by the limitation.  Admittedly, in the present

proceeding,   the   plaintiffs   relied   on   the   subsequent   agreement   for
reconveyance dated 29.06.1986.   This itself shows that plaintiffs had
knowledge that the defendants were not ready and willing to reconvey
the   suit   property   therefore,   the   plaintiff   should   have   filed   the   suit
within   three   years   from   the   said   refusal   by   the   defendants.     The
plaintiffs had filed the suit on 28.12.2002.  Hence, the Appellate Court
in paragraph 55 of the impugned decree rightly held that the suit filed
by the plaintiffs was barred by limitation.
24 In any case, the  plaintiffs failed to make out any substantial
question of law in the present Second Appeal.  The Apex Court in the
matter of Pakeerappa Rai (Supra) held that erroneous finding of fact
even if grave in nature could not be interfered with the Second Appeal.
25 Considering the submissions made by the learned Counsel for the
Plaintiffs and the authorities relied by the respondents/defendants as
stated herein above, I am of the opinion that the plaintiffs have failed
to make out any substantial question of law in the present Second
Appeal,
26 Hence, Second Appeal stands rejected.
27 In view of the rejection of the Second Appeal, nothing survives in
the Civil Application.  Hence, same is dismissed as infructuous.
         
                              (K.K.TATED, J.)

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