URVASHIBEN & ANR. versus KRISHNAKANT MANUPRASAD TRIVEDI on 14 December 2018

SUPREME COURT REPORTS

[2018] 13 S.C.R.

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URVASHIBEN & ANR.

v.

KRISHNAKANT MANUPRASAD TRIVEDI

(Civil Appeal Nos. 12070-71 of 2018)

DECEMBER 14, 2018

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[UDAY UMESH LALIT AND R. SUBHASH REDDY, JJ.]

Code of Civil Procedure, 1908 – Or.VII, r.11(d) – Rejectionof plaint on the ground that suit was barred by limitation –Respondent-plaintiff case was that the predecessor-in-title of theCappellants-defendants had agreed to sell the suit property to himand executed agreement to sell for a sale consideration – Time wasnot the essence of the contract – Total consideration amount waspaid by the respondent – Respondent visited the property after about25 years and found that the suit property was sold to third party –Suit filed for specific performance of agreement to sell by theDrespondent – Appellant-defendant filed application u/Or.VII, r.11(d)of CPC to reject the plaint on the ground that suit was barred bylimitation – Application allowed by the trial Court – However, orderwas set aside by the High Court – On appeal, held: When rejectionof plaint is sought in an application filed u/Or.VII, r.11 same is to beEconsidered from the facts of each case, looking at the avermentsmade in the plaint, for the purpose of adjudicating such application– In instant case, it is a matter for trial to record correctness orotherwise of allegations made in the plaint – The merits and demeritsof the matter cannot be gone into, while deciding the applicationfiled u/Or.VII, r.11 of CPC – At this stage only averments in theFplaint are to be looked into and from a reading of the averments inthe plaint in case on hand, it cannot be said that suit was barred bylimitation – Furthermore, it is settled that when the time is not fixedin the agreement, the limitation of three years to file a suit forspecific performance would begin when the plaintiff has noticedGthat defendant has refused the performance of the agreement – Theissue as to when the plaintiff had noticed refusal, is an issue whichcan be adjudicated after trial – Limitation Act, 1963 – Art.54.

Dismissing the appeals, the Court

HELD: 1. From a reading of the Article 54 of LimitationHAct, 1963, it is clear that when the date is fixed for performance, limitation is three years from such date. If no such date is fixed,the period of three years is to be computed from the date whenthe plaintiff, has notice of refusal. When rejection of plaint issought in an application filed under O.VII R.11, same is to beconsidered from the facts of each case, looking at the avermentsmade in the plaint, for the purpose of adjudicating such application.As averred in the plaint, it is the case of the plaintiff that evenafter payment of the entire consideration amount registration ofthe document was not made and prolonged on some grounds andultimately when he had visited the site, he had come to knowthat the same land was sold to third parties and appellants haverefused performance of contract. In such event, it is a matter fortrial to record correctness or otherwise of such allegation madein the plaint. In the suits for specific performance falling in thesecond limb of the Article, period of three years is to be countedfrom the date when it had come to the notice of the plaintiff thatperformance is refused by the defendants. For the purpose ofcause of action and limitation when it is pleaded that when he hadvisited the site, he had come to know that the sale was made infavour of third parties and the appellants have refused to executethe Sale Deed in which event same is a case for adjudication aftertrial but not a case for rejection of plaint under O.VII R.11(d) ofCPC. [Para 12][1249-D-G]

2. In cases falling in second limb of Article 54, finding canbe recorded only after recording evidence. Furthermore, whenthe time is not fixed in the agreement, the limitation of threeyears to file a suit for specific performance would begin when theplaintiff has noticed that defendant has refused the performanceof the agreement. [Para 14][1251-E-F]

3. In the instant case, the merits and demerits of the mattercannot be gone into at this stage, while deciding an applicationfiled under O.VII R.11 of the CPC. It is fairly well settled that atthis stage only averments in the plaint are to be looked into andfrom a reading of the averments in the plaint in the case on hand,it cannot be said that suit is barred by limitation. The issue as towhen the plaintiff had noticed refusal, is an issue which can beadjudicated after trial. Even assuming that there is inordinatedelay and laches on the part of the plaintiff, same cannot be a AB

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[2018] 13 S.C.R.

Aground for rejection of plaint under O.VII R.11(d) of CPC.[Para 15][1252-A-C]

Gunwantbhai Mulchand Shah & Ors. v. Anton ElisFarel & Ors.(2006) 3 SCC 634 : [2006] 2 SCR 886;Rathnavathi & Anr. v. Kavita Ganashamdas (2015) 5SCC 223 ; Balsaria Construction (P) Ltd. v. HanumanSeva Trust & Ors.(2006) 5 SCC 658 ; Chhotanben &Anr. v. Kiritbhai Jalkrushnabhai Thakkar & Ors.(2018)6 SCC 422 : [2018] 3 SCR 422 – relied on.

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Prabhakar v. Joint Director, Sericulture Department &Anr. (2015) 15 SCC 1 ; T. Arivandandam v. T.V. SatyapalC& Anr (1977) 4 SCC 467 : [1978] 1 SCR 742 ; HardeshOres (P) Ltd. v. Hede & Co. (2007) 5 SCC 614 : [2007]6 SCR 608 ; Dilboo (Smt.) (Dead) by LRs & Ors. v.Dhanraji (Smt.) (Dead) & Ors.(2000) 7 SCC 702 :[2000] 3 Suppl. SCR 214 ; I.T.C. Limited v. DebtsDRecovery Appellate Tribunal & Ors.(1998) 2 SCC 70 :[1997] 6 Suppl. SCR 683 ; Raj Narain Sarin (Dead)through LRs. & Ors. V. Laxmi Devi & Ors. (2002) 10SCC 501 ; N.V. Srinivasa Murthy & Ors. v. Mariyamma(Dead) by Proposed LRs. & Ors.(2005) 5 SCC 548 :[2005] 1 Suppl. SCR 411 ; Madanuri Sri Rama ChandraEMurthy v. Syed Jalal (2017) 13 SCC 174 : [2017] 5SCR 294 ; Church of Christ Charitable Trust &Educational Charitable Society v. PonniammanEducational Trust (2012) 8 SCC 706 : [2012] 6 SCR404 ; Madina Begum & Anr. v. Shiv Murti PrasadFPandey & Ors. (2016) 15 SCC 322 : [2016] 5 SCR92 ; Ahmadsahab Abdul Mulla(2)(Dead) by ProposedLRs. v. Bibijan & Ors. (2009) 5 SCC 462 : [2009] 5SCR 476 – referred to.

Case Law Reference

URVASHIBEN & ANR. v. KRISHNAKANT MANUPRASADTRIVEDI

CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 12070-12071 of 2018.

From the Judgment and Order dated 10.07.2018 of the High Courtof Gujarat at Ahmedabad in First Appeal No. 160 of 2018 with CivilApplication No. 1 of 2018.

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Anshin H. Desai, Sr. Adv., Shiv Mangal Sharma, Parth J.Contractor, Saurabh Rajpal, Kartikey Bhatt, M/S. Aura & Co., Advs.for the Appellants.

Dushyant A. Dave, Ms. Meenakshi Arora, Sr. Advs., Ms.MonishaHanda, Mohit D. Ram, Advs. for the Respondent.

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The Judgment of the Court was delivered by

R. SUBHASH REDDY, J.

1. Leave granted.

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2. These civil appeals are preferred by the defendants in CivilSuit No.930 of 2017, on the file of the City Civil Court, Ahmedabad,aggrieved by the judgment and decree of the High Court of Gujaratdated 10.07.2018 passed in Regular First Appeal No.160 of 2018 andCivil Application No.1 of 2018.

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3. The respondent-plaintiff has filed Civil Suit No.930 of 2017 forspecific performance of the Agreement to Sell dated 13.03.1992 withregard to suit schedule property, i.e. Final Plot No.147 of Town PlanningScheme No.3 of Mouje Shekhpur-Khanpur of Ahmedabad, admeasuring2821 Sq.Mtrs. It is the case of the plaintiff that the predecessor-in-titleof the appellant-defendants, one Chaitanyabhai Patel, had agreed to sell H

Athe suit schedule property to him and execute Agreement of Sale / SaleDeed for a sale consideration of Rs.32 lacs. The total considerationamount of Rs.32 lacs was paid during the period from 15.01.1990 to05.09.1991. It is stated that such payments are acknowledged byvouchers. It was the case of the respondent-plaintiff that, time was notthe essence of the contract, and citing financial problems, the Sale DeedBwas not executed. It is alleged that deceased Chaitanyabhai Patel hasgiven trust and belief that he will execute the Sale Deed. However,recently when the respondent-plaintiff had visited the suit scheduleproperty on 25.05.2017 he has come to know that the said property wassold to third party in view of increase in prices. It is alleged in the plaintCthat the appellant-defendants have expressed that they will not executethe Sale Deed. Hence, the suit is filed.

4. In the aforesaid suit, the appellant-defendants have filedapplication under Order VII Rule 11(d) of the Code of Civil Procedure(CPC) to reject the plaint on the ground that suit is barred by limitation.DThe said application was contested by the respondent herein. However,trial court, by order dated 27.12.2017, allowed the application and orderedto reject the plaint.

5. As against the same, respondent-plaintiff preferred RegularFirst Appeal No.160 of 2018 before the High Court of Gujarat atAhmedabad. By the judgment and decree dated 10.07.2018, the HighECourt has allowed the appeal filed by the respondent by setting aside theorder of the trial court dated 27.12.2017. As against the same, thesecivil appeals are filed.

6. We have heard Sri Anshin H. Desai, learned senior counsel forthe appellants and Sh. Dushyant Dave, learned senior counsel for theFrespondent-plaintiff.

7. In these appeals, it is contended by Sri Desai, learned seniorcounsel appearing for the appellants that the alleged Agreement to Sellis dated 13.03.1992 and the suit is filed in the year 2017, i.e., after aperiod of 25 years and even according to the case of the respondent-Gplaintiff there is no communication at all in between the period from1992 to 2017. It is submitted that except stating that he had visited thesite on 25.05.2017 on which date he has come to know the said plot issold to third parties, there is nothing on record to show that the suit iswithin limitation. Referring to Article 54 of the Limitation Act, 1963 it iscontended by learned counsel that even in absence of prescribing timeH

for executing the Sale Deed, the period of three years is to be computedfrom the date of refusal. It is submitted that by waiting for a period of25 years and by merely stating that he had visited the site on 25.05.2017on which date, the appellants have refused to execute the Sale Deed,such a suit is filed. It is submitted that the suit filed is frivolous, vexatiousand ex-facie barred by limitation. It is contended that even in absenceof fixing any period for executing the Sale Deed, it is not open torespondent-plaintiff to file the suit after 25 years of alleged Sale Deed /Agreement to Sell. It is further stated that the so-called Agreement toSell is unregistered one, not supported by any payments through cheque.Vaguely stating that entire amount of consideration is paid, by way ofcash during the period from 15.01.1990 to 05.09.1991, the said suit isfiled. It is contended by learned counsel that a well reasoned orderpassed by the trial court is set aside by the High Court without recordingany justifiable reasons. In support of his case for rejection of plaintunder O.VII R.11, learned counsel has placed reliance on judgment ofthis Court in the case of Prabhakar v. Joint Director, SericultureDepartment & Anr.[1]; T. Arivandandam v. T.V. Satyapal & Anr.[2];Hardesh Ores (P) Ltd. v. Hede & Co.[3]; Dilboo (Smt.) (Dead) by LRs& Ors. v. Dhanraji (Smt.) (Dead) & Ors.[4]; I.T.C. Limited v. DebtsRecovery Appellate Tribunal & Ors.[5]; Raj Narain Sarin (Dead)through LRs. & Ors. V. Laxmi Devi & Ors.[6]; N.V. Srinivasa Murthy& Ors. v. Mariyamma (Dead) by Proposed LRs. & Ors.[7]; MadanuriSri Rama Chandra Murthy v. Syed Jalal[8]and in the case of Churchof Christ Charitable Trust & Educational Charitable Society v.Ponniamman Educational Trust[9].

8. On the other hand Sh. Dushant Dave, learned senior counselappearing for the respondent has submitted that the appellant-defendantssought rejection of the plaint under O.VII R.11(d) of the CPC only onthe ground that suit is barred by limitation. It is the contention by thelearned counsel that undisputedly time was not the essence of the contract, 1(2015) 15 SCC 12(1977) 4 SCC 4673(2007) 5 SCC 6144(2000) 7 SCC 7025(1998) 2 SCC 706(2002) 10 SCC 5017(2005) 5 SCC 5488(2017) 13 SCC 1749(2012) 8 SCC 706

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Ain which event as per Article 54 of the Limitation Act 1963, the period oflimitation is three years from the date of refusal. It is submitted that thelimitation being a mixed question of fact and law, whether the suit is filedwithin a period of three years from the date of refusal, is a triable issue,which can be adjudicated only after trial but same is no ground forrejection of the plaint at this stage. It is submitted that for the purpose ofBconsidering the application under O.VII R.11(d), plain averments in theplaint are to be seen and no other ground can be a ground for rejectionof the plaint, under O.VII R.11(d). It is submitted that whether, from theaverments in the plaint in a given case, plaint is to be rejected or notunder O.VII R.11, is to be considered with reference to facts of eachCcase and from the case on hand, it cannot be said that suit is barred bylimitation, only by looking at the averments in the plaint. Learned counselhas contended that all the citations by learned counsel for the appellantsare not applicable to the facts of the case on hand and, in support of hisarguments, reliance is placed in the case of Gunwantbhai MulchandShah & Ors. v. Anton Elis Farel & Ors.[10]; Rathnavathi & Anr. v.DKavita Ganashamdas[11]; Madina Begum & Anr. v. Shiv Murti PrasadPandey & Ors.[12] and Chhotanben & Anr. v. KiritbhaiJalkrushnabhai Thakkar & Ors.[13].

9. Having heard learned counsel on both sides, we have perusedthe order passed by the trial court as well as the High Court and otherEmaterial placed on record.

10. The trial court has allowed the application filed by the appellant-defendants, by holding a finding that respondent-plaintiff, by cleverdrafting, has created illusion of cause of action and stated that cause ofaction has arisen on 25.05.2017, but he failed to give justifiable explanationFfor unreasonable delay in filing the suit. Trial court further held thatwhen the plaintiff has not taken any action for 25 years, by clever drafting,the plaintiff cannot bring an action within the period of limitation.Therefore, it has held that suit being barred by limitation, attracts rejectionunder O.VII R.11(d) of CPC. The High Court has set aside the order ofthe trial court by recording a finding that going by the plain averments inGthe suit, it cannot be stated that the same is barred by limitation.

10(2006) 3 SCC 63411(2015) 5 SCC 22312(2016) 15 SCC 322H13(2018) 6 SCC 422

URVASHIBEN & ANR. v. KRISHNAKANT MANUPRASADTRIVEDI [R. SUBHASH REDDY, J.]

11. It is fairly well settled that, so far as the issue of limitation isconcerned, it is a mixed question of fact and law. It is true that limitationcan be the ground for rejection of plaint in exercise of powers underO.VII R.11(d) of the CPC. Equally, it is well settled that for the purposeof deciding application filed under O.VII R.11 only averments stated inthe plaint alone can be looked into, merits and demerits of the matter andthe allegations by the parties cannot be gone into. Article 54 of theLimitation Act, 1963 prescribes the limitation of three years, for suits forspecific performance. The said Article reads as under :

12. From a reading of the aforesaid Article, it is clear that whenthe date is fixed for performance, limitation is three years from suchdate. If no such date is fixed, the period of three years is to be computedfrom the date when the plaintiff, has notice of refusal. When rejectionof plaint is sought in an application filed under O.VII R.11, same is to beconsidered from the facts of each case, looking at the averments madein the plaint, for the purpose of adjudicating such application. As averredin the plaint, it is the case of the plaintiff that even after payment of theentire consideration amount registration of the document was not madeand prolonged on some grounds and ultimately when he had visited thesite on 25.05.2017 he had come to know that the same land was sold tothird parties and appellants have refused performance of contract. Insuch event, it is a matter for trial to record correctness or otherwise ofsuch allegation made in the plaint. In the suits for specific performancefalling in the second limb of the Article, period of three years is to becounted from the date when it had come to the notice of the plaintiff thatperformance is refused by the defendants. For the purpose of cause ofaction and limitation when it is pleaded that when he had visited the siteon 25.05.2017 he had come to know that the sale was made in favour ofthird parties and the appellants have refused to execute the Sale Deed inwhich event same is a case for adjudication after trial but not a case forrejection of plaint under O.VII R.11(d) of CPC.

13. Counsel for the appellants has placed reliance on the judgmentin the case of Prabhakar (supra). In the above said case, this Court hasheld that, even where no limitation period is prescribed by the Statute, AB

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Acourts apply doctrine of delay/laches/acquiescence and non-suit litigantswho approach court belatedly without justifiable explanation. Delay andlaches are to be examined with reference to facts of each case and thesaid judgment is not helpful to support the case of the appellant inasmuchas this matter arises out of an application filed under O.VII R.11(d) ofthe CPC. The judgment in the case of T. Arivandandam (supra) pertainsBto eviction from tenanted premises which was contested by the tenant.In the said case where rejection of plaint under O.VII R.11(d) wasconsidered on the ground that plaint does not disclose cause of actionbut not a case for rejection of plaint on the ground of limitation. In thecase of Hardesh Ores (supra) it was the case falling in the first limb ofCArticle 54 of the Limitation Act 1963 but not a case falling under secondlimb, where the time is not the essence of the contract. In the judgmentin the case of Dilboo (Dead) (supra) this Court has considered relevantprinciples of applicability of O.VII R.11 of CPC. Equally, the case ofI.T.C. Limited (supra) is a case concerning rejection of plaint underO.VII R.11(a) but not case of rejection on the ground of limitation. InDthe case of Raj Narain Sarin (supra) the suit was filed after 40 yearsafter execution of the Sale Deed and as a fact it was found that SaleDeed was to the knowledge of the plaintiff and he had not taken anysteps to declare the Sale Deed invalid. In that context, the order passedunder O.VII R.11 was confirmed by this Court. In the case of N.V.ESrinivasa (supra) the suit is for declaration but not for specificperformance and in the said suit having regard to the facts of the casethis Court has held that suit for declaration filed by the plaintiff is notmaintainable. In the case of Madanuri Rama (supra) the suit was filedseeking cancellation of Sale Deed on the ground that property in questionis a waqf property which cannot be sold to a private party. The aforesaidFcase is a case not concerning limitation under Article 54 of the LimitationAct 1963.

14. On the other hand, judgment in the case Gunwantbhai (supra)this Court has held as under :

“8. We may straightaway say that the manner in which the questionGof limitation has been dealt with by the courts below is highlyunsatisfactory. It was rightly noticed that the suit was governedby Article 54 of the Limitation Act, 1963. Then, the enquiry shouldhave been, first, whether any time was fixed for performance inthe agreement for sale, and if it was so fixed, to hold that a suitHfiled beyond thre years of the date was barred by limitation unless

any case of extension was pleaded and established. But in a casewhere no time for performance was fixed, the court had to findthe date on which the plaintiff had notice that the performancewas refused and on finding that date, to see whether the suit wasfiled within three years thereof. We have explained the positionin the recent decision in R.K. Parvtharaj Gupta v. K.C. JayadevaReddy (2002) 2 SCC 428. In the case on hand, there is no disputethat no date for performance is fixed in the agreement and if so,the suit could be held to be barred by limitation only on a findingthat the plaintiffs had notice that the defendants were refusingperformance of the agreement. In a case of that nature normally,the question of limitation could be decided only after taking evidenceand recording a finding as to the date on which the plaintiff hadsuch notice. We are not unmindful of the fact that a statementappears to have been filed on behalf of the plaintiffs that they didnot want to lead any evidence. The defendants, of course, tookthe stand that they also did not want to lead any evidence. As wesee it, the trial court should have insisted on the parties leadingevidence on this question or the court ought to have postponedthe consideration of the issue of limitation along with the otherissues arising in the suit, after a trial.”

In the aforesaid case, it is clearly held that in cases falling insecond limb of Article 54 finding can be recorded only after recordingevidence. The said view expressed by this Court supports the case ofthe respondent-plaintiff. In the judgment in the case of Rathnavathi(supra) in paragraphs 42 and 43 it was clearly held that when the time isnot fixed in the agreement, the limitation of three years to file a suit forspecific performance would begin when the plaintiff has noticed thatdefendant has refused the performance of the agreement. In the judgmentin the case of Ahmadsahab Abdul Mulla(2)(Dead) by Proposed LRs.v. Bibijan & Ors.[14] while interpreting Article 54 of the Limitation Act, itis held that words “date fixed for the performance” is a crystallisednotion. The second part “time from which period begins to run” refersto a case where no such date is fixed. In the case of BalsariaConstruction (P) Ltd. v. Hanuman Seva Trust & Ors.[15] andChhotanben (supra) this Court clearly held that issue of limitation,being a mixed question of fact and law, is to be decided only afterevidence is adduced.

14(2009) 5 SCC 462

15(2006) 5 SCC 658

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A15. By applying the aforesaid principles in the judgments relied onby Sri Dushyant Dave, learned senior counsel appearing for therespondent, we are of the considered view that merits and demerits ofthe matter cannot be gone into at this stage, while deciding an applicationfiled under O.VII R.11 of the CPC. It is fairly well settled that at thisstage only averments in the plaint are to be looked into and from a readingBof the averments in the plaint in the case on hand, it cannot be said thatsuit is barred by limitation. The issue as to when the plaintiff had noticedrefusal, is an issue which can be adjudicated after trial. Even assumingthat there is inordinate delay and laches on the part of the plaintiff, samecannot be a ground for rejection of plaint under O.VII R.11(d) of CPC.

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16. For the aforesaid reasons, we do not find any illegality in thejudgment of the High Court, so as to interfere with the same in theseappeals. Accordingly, these appeals are dismissed, being devoid of merit,with no order as to costs. We make it clear that we have not expressedany opinion on the merits of the matter, including on the issue of limitation.DIt is open for the trial court to frame issues, including the issue of limitation,and decide the matter on its own merits. As the alleged agreement is ofthe year 1992, trial court to dispose of the suit, as expeditiously, as possible.

Ankit Gyan

Appeals dismissed.

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