RAMAN (DEAD) BY LRS. versus R. NATARAJAN on 13 September 2022

RAMAN (DEAD) BY LRS.

v.

R. NATARAJAN

(Civil Appeal No. 6554 of 2022)

SEPTEMBER 13, 2022

[INDIRA BANERJEE AND V. RAMASUBRAMANIAN, JJ.]

Specific Relief Act, 1963 – s.12, 13(1)(b) – Limitation Act,1963 – s.18(1), Art.54 – Suit for specific performance involvingthird party – Grant of decree for specific performance – Correctnessof – Held: High Court ought to have seen that the specificperformance of the Agreement in question comprised of two parts(i) the defendant (predecessor of appellants) entering into anagreement with his brother’s wife for the purchase of a land forproviding access to the land agreed to be sold under the suitAgreement of Sale; and (ii) the defendant then executing a saledeed conveying the property covered by the suit Agreement of Sale– Since the defendant’s brother’s wife was not a party to the suitagreement of sale, the Court cannot compel her to enter into anagreement with the defendant – Thus, performance of the first partof the obligation cannot be compelled by the Court, as it dependedupon the will of a third party – Consequently, the performance ofthe second part of the obligation, may be hit by s.12(1) – Also,none of the exceptions contained in sub-sections (2), (3) and (4)will apply – Even the limited rights conferred by s.13(1)(b) are notavailable to the respondent-plaintiff – Further, the High Court couldnot have answered the question of limitation in favour of therespondent without framing any substantial question of law andwithout even a reference to Article 54 – Impugned judgment setaside – Relief of specific performance claimed by the respondent isrejected.

Suit – For specific performance involving third party – Held:Court cannot grant the relief of specific performance against aperson compelling him to enter into an agreement with a third partyand seek specific relief against such a third party.

227

A

B

C

DEF

G

H

AAllowing the appeal, the Court

HELD: 1.1 The mistakes committed by the High Courtwere manifold. First, the High Court framed a question whichwas actually a question of fact which involved appreciation ofevidence and not a substantial question of law. As a consequence,Bthe answer given by the High Court was only a finding of fact.Next, the High Court reversed the finding of the First AppellateCourt on the question of limitation, without framing a substantialquestion of law and without even referring to the statutoryprovisions. The Agreement is dated 19.06.1993. The Agreementcontains four endorsements which are dated 12.11.1995,C11.05.1998, 27.01.2001, 10.07.2005. The defendant raised thequestion of limitation, on the basis of the fact that the fourthendorsement was made beyond a period of three years from thedate of the third endorsement. Such a defence was based uponSection 18(1) of the Limitation Act, 1963. But as a matter of fact,Dthe limitation for filing a suit for specific performance, in terms ofArticle 54 of The Schedule to the Limitation Act, 1963 is threeyears, “from the date fixed for the performance or if no such dateis fixed, when the plaintiff has notice that the performance isrefused.” But in the entire memorandum of grounds of secondappeal filed by the respondent before the High Court, there wasEno whisper or reference to Article 54 of the Schedule to theLimitation Act, 1963. The only substantial question of law framedby the High Court at the time of entertaining the second appealwas not about limitation revolving around Article 54 of theSchedule to the Limitation Act. Therefore, the High Court couldFnot have answered the question of limitation in favour of therespondent herein, (i) without framing any substantial questionof law; and (ii) without even a reference to Article 54. [Paras 11-15][232-G-H; 233-A-E]

1.2 In any case, the High Court ought to have seen that aGCourt cannot grant the relief of specific performance against aperson compelling him to enter into an agreement with a thirdparty and seek specific relief against such a third party. In otherwords, the specific performance of the agreement by the appellantsherein, depended upon (i) the appellants entering into anagreement with a third party; and (ii) appellants being in a positionH

to compel such third party to perform her obligations under suchagreement. The High Court ought to have seen that the specificperformance of the Agreement in question comprised of two partsnamely, (i) the defendant entering into an agreement with hisbrother’s wife for the purchase of a land for providing access tothe land agreed to be sold under the suit Agreement of Sale; and(ii) the defendant thereafter executing a sale deed conveying theproperty covered by the suit Agreement of Sale. Since thedefendant’s brother’s wife was not a party to the suit agreementof sale, the Court cannot compel her to enter into an agreementwith the defendant. In other words, the performance of the firstpart of the obligation, which we have indicated in the precedingparagraph, cannot be compelled by the Court, as it dependedupon the will of a third party. As a consequence, the performanceof the second part of the obligation, may be hit by Section 12(1)of the Specific Relief Act, 1963. [Paras 16, 17][233-E-H; 234-A-B]

1.3 From the pleadings on record, it appears that the caseon hand will not even be covered by sub-sections (2), (3) & (4) ofSection 12 of the Specific Relief Act. Since it is stated very clearlyin the suit Agreement of Sale that the land covered by theAgreement will not have any access, unless the defendant enteredinto an agreement with his brother’s wife, it is clear that none ofthe exceptions contained in sub-sections (2), (3) and (4) of Section12 will apply. Even the limited rights conferred by Section 13(1)(b)of the Specific Relief Act are not available to the respondent, asthere was no legal right in the defendant to compel 3rd parties toconvey their land to him for the purpose of providing a pathwayto the land agreed to be sold to the respondent herein. Therefore,the High Court committed a grave error in law in granting a decreefor specific performance. Hence the appeal is allowed, theimpugned judgment of the High Court is set aside and the reliefof specific performance claimed by the respondent is rejected.However, there will be a decree directing the appellants to payto the respondent, the amount of Rs.1,44,400/- paid by therespondent, with interest @ 9% p.a. from the date of filing of thesuit, till the date of repayment. The parties shall bear theirrespective costs throughout. [Paras 18-21][234-D-E; 235-A-B]

AB

C

D

E

F

G

H

ACIVIL APPELLATE JURISDICTION: Civil Appeal No. 6554of 2022.

From the Judgment and Orders dated 24.04.2018 of the HighCourt of Judicature at Madras in Second Appeal No. 64 of 2015.

G. Sivabalamurugan, P. Shankar, C. Adhikesavan, Advs. for theBAppellants.

S. Nandakumar, Ms. Deepika Nandakumar, Anand Murthi, NareshKumar, Advs. for the Respondent.

The following Judgment of the Court was passed :

JUDGMENT

C

Leave granted.

2. The suit for specific performance of an Agreement of Sale ofan immovable property, filed by the respondent herein, was decreed bythe Trial Court but the said decree was reversed by the First AppellateCourt. However, the High Court reversed the Judgment and decree ofDthe First Appellate Court and restored the decree for specific performancegranted by the Trial Court. Aggrieved by the same, the legalrepresentatives of the original defendant are on appeal.

3. We have heard Mr. G. Sivabalamurugan, learned counsel forthe appellants and Mr. S. Nandakumar, learned counsel for theErespondent.

4. The respondent herein filed a suit in O.S. No.360 of 2008 onthe file of the First Additional District Munsif, Salem, for specificperformance of an Agreement of Sale dated 19.06.1993, contendinginter alia :F

that the appellants agreed to sell the suit property which isa land of the extent of about 76 cents for a total saleconsideration of Rs.1,44,000; that an advance of Rs.25,000 was paid at the time ofexecution of the Agreement; G

that the defendant received further amounts ofRs.50,000/- on 19.11.1995, Rs.43,000/- on 11.05.1998,Rs.10,000/- on 27.01.2001 and Rs.16,400/- on 10.07.2005; that appropriate endorsements were made on the reverseof the first, second and third pages of the agreement; H

that the entire sale consideration thus stood paid;A

that it was provided in the Agreement that the defendantshould simultaneously enter into an agreement with hisbrother’s wife for the purchase of a portion of her land, tobe used as pathway for access to reach the suit property; B

that the time for performance of the obligations under theAgreement was fixed as 11 months from the date of thedefendant entering into an agreement with his brother’s wifefor the purchase of the land for the pathway; that however when the plaintiff issued a legal notice dated27.03.2007, the defendant sent a reply denying everything;and C

that therefore, the plaintiff was constrained to file the suit.

5. The defendant filed a written statement denying everything,including the execution of the Agreement. Therefore, the Trial Courtframed the following issues; D

“(i) Is the Agreement of Sale dated 19-8-93 real and true?

(ii) Is the suit barred by limitation?

(iii) Is the plaintiff eligible for the relief of specific performance?

E

(iv) Any other relief?”

6. After trial, the Trial Court passed a Judgment and decree dated14.02.2012, holding that the Agreement dated 19.06.1993 was true andvalid; that the suit was not barred by limitation; and that the plaintiffwas entitled to the relief of specific performance.

F

7. The First Appellate Court came to the conclusion, that the endorsements made in the Agreement of sale on12.11.1995, 11.05.1998, 27.01.2001 and 10.07.2005 markedas Exhibit A-2 to A-5, were not proved; G

that the plaintiff could not prove that he was ready andwilling to perform his part of the obligations; that the suit was barred by limitation; and that, therefore, the plaintiff was not entitled to specificperformance.

H

A8. The only substantial question of law framed by the High Courtat the time of admission of the second appeal was as follows:

“In the light of the finding of the trial Court that Ex. A-1 – saleagreement is true, whether the First Appellate Court was right inholding that the endorsements made on Ex.A.1 under Exs.A.2 toBA.5 have not been proved though, according to the plaintiff, it hasbeen proved by the evidence of P.Ws. 2 and 3?”

9. The High Court recorded its opinion on the above substantialquestion of law as follows:

“From over all consideration of pleadings, oral and documentaryCevidence and the judgment of the trial Court, it is clear that thefirst respondent only executed Exs.A.1 to A.5 and the FirstAppellate Judge on erroneous consideration of pleadings andevidence of P.Ws.2 to 3 held that the appellant failed to prove theendorsements in Exs.A.2 to A.5 after holding that Ex.A.1 wasDexecuted by the first respondent and relying of Ex.A.2 to holdthat suit is barred by limitation.”

10. What was recorded as above was not actually an answer tothe substantial question of law, even if we construe what was framed, tobe a substantial question of law. The above finding is actually a findingEof fact. Apart from that, the High Court also went beyond the substantialquestion of law framed by it and proceeded to hold that the suit was notbarred by limitation. The High Court opined that the time for performanceof the obligations under the Agreement was fixed as 11 months from thedate on which the defendant entered into an agreement with his brother’swife for the purchase of a land to be used as pathway. However, theFdefendant did not enter into any agreement with his brother’s wife. Onthe other hand, the defendant chose to deny the very execution ofAgreement of Sale in his reply notice dated 04.04.2007. Therefore, theHigh Court held that limitation started running from the date of refusaland that the suit filed in November, 2007 was within the period of limitation.

G

G11. The mistakes committed by the High Court were manifold.First, the High Court framed a question which was actually a question offact which involved appreciation of evidence and not a substantial questionof law. As a consequence, the answer given by the High Court was onlya finding of fact. Next, the High Court reversed the finding of the FirstAppellate Court on the question of limitation, without framing a substantialHquestion of law and without even referring to the statutory provisions.

12. As we have pointed out earlier, the Agreement is dated19.06.1993. The Agreement contains four endorsements which are dated12.11.1995, 11.05.1998, 27.01.2001, 10.07.2005.

13. The defendant raised the question of limitation, on the basis ofthe fact that the fourth endorsement was made beyond a period of threeyears from the date of the third endorsement. Such a defence was basedupon Section 18(1) of the Limitation Act, 1963.

14. But as a matter of fact, the limitation for filing a suit for specificperformance, in terms of Article 54 of The Schedule to the LimitationAct, 1963 is three years, “from the date fixed for the performance orif no such date is fixed, when the plaintiff has notice that theperformance is refused.”

15. But in the entire memorandum of grounds of second appealfiled by the respondent-herein before the High Court, there was nowhisper or reference to Article 54 of the Schedule to the Limitation Act,1963. The only substantial question of law framed by the High Court atthe time of entertaining the second appeal was not about limitationrevolving around Article 54 of the Schedule to the Limitation Act.Therefore, the High Court could not have answered the question oflimitation in favour of the respondent herein, (i) without framing anysubstantial question of law; and (ii) without even a reference to Article54.

16. In any case, the High Court ought to have seen that a Courtcannot grant the relief of specific performance against a personcompelling him to enter into an agreement with a third party and seekspecific relief against such a third party. In other words, the specificperformance of the agreement by the appellants herein, depended upon(i) the appellants entering into an agreement with a third party; and (ii)appellants being in a position to compel such third party to perform herobligations under such agreement.

17. The High Court ought to have seen that the specificperformance of the Agreement in question comprised of two parts namely,(i) the defendant entering into an agreement with his brother’s wife forthe purchase of a land for providing access to the land agreed to be soldunder the suit Agreement of Sale; and (ii) the defendant thereafterexecuting a sale deed conveying the property covered by the suitAgreement of Sale.

AB

C

D

E

F

G

H

A18. Since the defendant’s brother’s wife was not a party to thesuit agreement of sale, the Court cannot compel her to enter into anagreement with the defendant. In other words, the performance of thefirst part of the obligation, which we have indicated in the precedingparagraph, cannot be compelled by the Court, as it depended upon thewill of a third party. As a consequence, the performance of the secondBpart of the obligation, may be hit by Section 12(1) of the Specific ReliefAct, 1963 which reads as follows:- “12. Specific Performance of part of contract.-(1) Except asotherwise hereinafter provided in this section the court shall notdirect the specific performance of a part of contract.

C

xxx xxx xxx”

19. From the pleadings on record, it appears that the case on handwill not even be covered by sub-sections (2), (3) & (4) of Section 12 ofthe Specific Relief Act. Since it is stated very clearly in the suit AgreementDof Sale that the land covered by the Agreement will not have any access,unless the defendant entered into an agreement with his brother’s wife,it is clear that none of the exceptions contained in sub-sections (2), (3)and (4) of Section 12 will apply.

20. Even the limited rights conferred by Section 13(1)(b) of theESpecific Relief Act are not available to the respondent, as there was nolegal right in the defendant to compel 3[rd] parties to convey their land tohim for the purpose of providing a pathway to the land agreed to be soldto the respondent herein. Section 13(1)(b) reads as follows:

“13. Rights of purchaser or lessee against person with noFtitle or imperfect title.—(1)Where a person contracts to sellor let certain immovable property having no title or only animperfect title, the purchaser or lessee (subject to the otherprovisions of this Chapter), has the following rights namely:- (a) xxx xxxxxx G(b) where the concurrence of other persons is necessary forvalidating the title, and they are bound to concur at the request ofthe vendor or lessor, the purchaser or lessee may compel him toprocure such concurrence, and when a conveyance by otherpersons is necessary to validate the title and they are bound toconvey at the request of the vendor or lessor, the purchaser orHlessee may compel him to procure such conveyance;”

21. Therefore, the High Court committed a grave error in law ingranting a decree for specific performance. Hence the appeal is allowed,the impugned judgment of the High Court is set aside and the relief ofspecific performance claimed by the respondent is rejected. However,there will be a decree directing the appellants to pay to the respondent,the amount of Rs.1,44,400/- paid by the respondent, with interest @ 9%p.a. from the date of filing of the suit, till the date of repayment. Theparties shall bear their respective costs throughout.

Divya Pandey(Assisted by : Roopanshi Virang, LCRA)

Appeal allowed.

A

B

C

D

E

F

G

H