1 IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA RFA No. 12 of 2005 Reserved on : 8th July, 2009 Date of Decision: 27th July, 2009 Punita Bharti Appellant/plaintiff Versus Shri Kirpal Singh Respondent/defendant Coram The Hon’ble Mr. Justice Sanjay Karol,J. Whether approved for reporting1? Yes For the appellant: Mr.Ramakant Sharma, Advocate. For the respondent: Mr.Bhupinder Gupta, Sr. Advocate, with Mr.Neeraj Gupta, Advocate. Sanjay Karol, J. This is the plaintiff’s first appeal against the judgment and decree dated 11.10.2004 passed by the learned District Judge, Solan, H.P. in Civil Suit No.3-S/1 of 2004, titled as Smt. Punita Bharti vs. Shri Kirpal Singh dismissing her suit for recovery of money. On 30.11.1999 plaintiff (appellant) and defendant (respondent) entered into an agreement for sale of land comprised in Khasra No.1167/731/4 measuring 552 square meters and Khasra No.730 and 1166/731 measuring 815 square meters, situated in Mauja Deon, Tehsil and District Solan, H.P. Whether the reporters of Local Papers are allowed to see the Judgment? 2 The sale consideration was fixed at Rs.28,70,700/- and two sums being Rs.50,000/- and Rs.1,50,000/- was received by the seller- defendant from the purchaser-plaintiff. In terms of the agreement, the sale deed was to be executed on 25.3.2000 when the balance sum was to be paid. According to the plaintiff, inspite of repeated assurances the defendant failed to construct a path and jeepable road to the land agreed to be sold to her. Finally legal notice dated 5.6.2003 was served upon the defendant, which was duly replied on 23.6.2003 wherein a totally false plea was taken to the effect that even though on the agreed date, the defendant waited for her in the office of the Sub Registrar, the plaintiff had failed to come forward to execute the sale deed in her favour, hence the earnest money stood forfeited. Thereafter plaintiff issued another notice. The cause of action accrued in favour of the plaintiff in the year 2000, 2001, 2002 and 2003 when the defendant kept on making the promises that he would be executing the sale deed after construction of path/road but, however, it was only in the year 2003 when the plaintiff learnt that the defendant had sold part of the land to third party, that the plaintiff filed the suit on 5.1.2004 for recovery of the amount paid to the defendant alongwith interest. The defendant contested the suit by taking the plea on merits that the plaintiff failed to get the sale deed executed and pay the balance sale consideration by 25.3.2000 i.e. date mentioned in the agreement for the execution of the sale deed. The defendant waited for the plaintiff to get the sale deed executed at the office of the Sub Registrar, Solan, but, however, neither did she come forward nor sent any information. Consequently, the defendant sent notice dated 4.4.2000 to the plaintiff informing to get the sale deed executed within 7 days failing 3 which the agreement was to stand rescinded. Since the plaintiff failed to accept the registered cover containing the notice and pay the balance consideration within 7 days, the amount paid by her stood forfeited. With regard to construction of path the defendant pleaded that the same was to be constructed only upon payment of fifty per cent of the sale consideration by 15.1.2000. Based on the pleadings of the parties, court below framed the following issues:- 1. Whether the plaintiff is entitled to the refund of the earnest money of Rs.two lacs alongwith interest at the rate of 12% P.A. as claimed? OPP 2. Whether the suit is barred by time? OPD. 3. Whether the plaintiff was to have the sale deed registered in her favour by 25th March 2000 but she did not come forward to get the sale deed executed and registered in favour by that date despite the defendant having waited for her at the office of Sub Registrar, Solan on 25.3.2000 as alleged, if so its effect? OPD. 4. Whether the defendant had agreed to provide five meters wide road by way of approach to the land agreed to be sold as alleged and the defendant having failed to provide such road the plaintiff did not approach the defendant for execution and registration of the sale deed by the last date stipulated in the agreement or even thereafter and as such the question of limitation does not arise as alleged? OPP. 5. Whether the present suit is not `competent in the individual name of the plaintiff because the agreement was executed by her not in her personal capacity but as the Director of M/s Shefali Resorts Pvt. Limited, as alleged? OPD. 4 6. Relief. Evidence was led by both the parties. The Court below decided Issues No.1,2 and 3 in the affirmative. The plaintiff was held entitled to refund of Rs.1,50,000/- advance money as also interest of Rs.55,500/- on the same w.e.f. 30.11.1999 upto the date of filing of the suit. Issue No.3 was decided by concluding that there was an agreement for providing 5 mts. Wide road as approach to the suit land and also there was an agreement to provide jeepable road, however, the same was not a condition precedent for execution of the sale deed. Since the plaintiff failed to get the sale deed registered within the stipulated time in her favour and the defendant rescinded the contract, the defendant was under no obligation to get the sale deed executed.. The plaintiff’s suit, however, was dismissed as having been barred by limitation and issue No.2 was decided accordingly. Mr. Ramakant Sharma, learned counsel for the plaintiff has assailed the findings on Issue No.2 before this Court. Mr. Bhupender Gupta, learned senior counsel for the defendant has supported the judgment for the reasons set out therein. I have heard the learned counsel for the parties and perused the record. It is not disputed at the bar that the relevant provisions governing the period of limitation is Article 47 of the Limitation Act, 1963, which prescribes the period of limitation to be three years for recovery of money paid upon an existing consideration which afterwards 5 fails and the time for which the limitation begins to run is the date of the said failure. The relevant terms of the agreement dated 30.11.1999 (Ext.PA/1) are reproduced as under:- “Whereas the 1st party agreed to sale this property and the 2nd party has agreed to purchase this land for the total consideration of Rs.28,70,700/- (Rupees Twenty eight lacs seventy thousand and seven hundred only) The 1st party has received Rs.50,000/- from the second party and Rs.1,50,000/- will be paid by the 2nd party on dated Novemebr, 99. The balance amount Rs.26,70,700/- will be paid by the 2nd party at the time of registration of sale deed time fixed 25th March, 2000. That if the party of 1st part fail to execute or any default in the conditions of this agreement held liable to pay double amount of earnest money. That if the 2nd party failed to execute with in stipulated period the proper sale deed in his favour in that even the earnest money paid to the 1st party will be forfeited and the 2nd party shall have no right to recover the same from the 1st party. That the first party will provide the path of 5 mtrs. opposite Dada Chela Ram Ashram and other Jeepable Road also will provide near Fharmo Chemicose Ind.” (Emphasis supplied) The plaintiff’s address given in the said agreement is as under:- “Shrimati Puneeta and Director Shilffali Resort Pvt. Ltd., R/o Near Harsh Palace, By Pass, Solan, H.P.” Defendant Kirpal Singh Kanwar (DW-1) has deposed that the plaintiff was required to make the payment of balance amount and get the sale deed executed in her favour in March, 2000. On the stipulated 6 date he visited the office of Sub Registrar but, however, the plaintiff failed to reach and get the sale deed executed before the Sub-Registrar. Consequently, he moved an application (Ext.DC) to mark his presence before the Sub Registrar. He also got a legal notice dated 4.4.2000 (Ext.DB/2) issued to the plaintiff, service of which was denied. The fact that the defendant appeared before the Sub- Registrar and moved the application stands duly corroborated by Shri Kirpa Ram, (DW-4) Senior Assistant, Tehsil Office, Solan. Shri Rajeev Garg, Advocate, (DW-2) has verified the contents of legal notice Ext.DB/2 and has proved the issuance of the same. The fact that the receipt of notice as per endorsement on the cover of the same (Ext.DB/1) was refused stands duly proved by the Postman concerned Shri Inder Singh (DW-3). According to him, the plaintiff refused to accept the cover Ext.DB/1. The said cover contained notice Ext.DB/2. Noticeably the address given on the cover Ext.DB/1 and the notice Ext.DB/2 is as under:- “Smt.Puneeta Director, Shifali Resort Pvt. Ltd., C/o Orbit Financers, Opp. Ashiana Marbel, Deonghat, Tehsil and Distt. Solan, H.P.” It is the plaintiff’s own case that in the year 2003 she got two notices issued to the defendant calling upon him to refund the amount for alleged breaches having committed by him. Legal notice dated 5.6.2003 (Ext.PA/3) and 2.8.2003 (Ext.PA/5), sent by the plaintiff incidentally records her address as under:- “Smt. Punita Bharti, resident of Orbit Property Consultants, Near Dada Chela Ram Ashram, Deonghat, Solan, Tehsil and District Solan,” 7 Evidently the address given on the cover (Ext.DB/1) containing the legal notice dated 4.4.2000 (Ext.DB/2) is more or less same as furnished by the plaintiff in the agreement and the legal notices sent by her. In the present case, the defendant as a matter of abundant caution not only examined the Advocate who issued the notice but also the postman who recorded the remarks of refusal. It is not the plaintiff’s case that report was improperly or falsely procured by the defendant. Thus the defendant has been able to prove by clear, cogent and convincing material that acceptance of the notice dated 4.4.2000 was refused by the plaintiff. Thus the plaintiff’s contention that the notice was never received by her needs to be rejected. The notice was correctly address, pre-paid and raises a presumption of service. The Apex Court in Gujarat Electricity Board vs. Atmaram, AIR 1989 SC 1433, has held that there is presumption of service of a letter sent under registered cover, if the same isreturned back with a postal endorsement that the addressee refused to accept the same. No doubt, the presumption is rebuttable and it is open to the party concerned to place evidence before the Court to rebut the presumption by showing that the address mentioned on the cover was incorrect or that the postal authorities never tendered the registered letter to him or that there was no occasion for him to refuse the same. The burden to rebut the presumption lies on the party, challenging the factum of service. Perusal of the contents of legal notice Ext.DB/2 evidently make it clear that contract stood rescinded 7 days after the date of receipt of the notice. The endorsement of refusal is in the month of April, 2000 8 thus the time for which the period of limitation begins to run is April, 2000 itself. The suit was filed on 5.1.2004. The plaintiff’s contention that the period of limitation commenced only w.e.f. 2003 has neither been substantially explained nor proved on record. Except for a bald, vague and unspecific statement of the plaintiff there is nothing on record. In her deposition, she has deposed as under:- “As per condition of the agreement 30.11.99 the defendant was to provide the path of five mtrs. opposite Dada Chela Ram Ashram and other jeepable road also was to be provided near Fharmo Chemicose Industries and in case of default by the defendant to fulfil the condition of agreement defendant was to pay double the earnest amount to the plaintiff but the defendant did not provided (sic) the requisite path and jeepable road to the above referred land and the plaintiff has been requesting him for the same and requesting the defendant to fulfil his part of the agreement and to receive balance payment but the defendant delayed the matter on one pretext or the other and ultimately assured the plaintiff that the same path and jeepable road would be provided at the end of March 2003 and registration of the sale deed would be executed thereafter but thereafter defendant finally refused to execute the sale deed and the plaintiff also came to know that the defendant already sold half of the above referred land to some other person. Possession of the land already delivered to the plaintiff has not been taken back by the defendant nor any step is taken by the defendant to take back the possession of the suit land. However deponent is ready to deliver the possession of the land in question provided the amount paid by the plaintiff to the defendant is refunded to her with interest as claimed in the suit. The time periods of the same agreement was extended with the consent of plaintiff 9 and defendant and ultimately plaintiff demanded refund of the amount paid by her to the defendant when she came to know in the first week of April, 2003 that the terms and conditions of the agreement was finally violated by the defendant and the same agreement is not at all executable now, but the defendant ignored the matter by one pretext or the other.” Importantly her statement cannot be taken to be a gospel truth. She has refused to divulge the particulars and details of the persons and the amount from whom she had made arrangements for paying the balance sale consideration. The sale deed was to be executed on the agreed conditions contained in the agreement i.e. on 25.3.2000. Importantly between this date and the issuance of the legal notice dated 5.6.2003 (Ext.PA/3) the plaintiff did not take any steps, calling upon the defendant to either perform the obligation of constructing the path/road or getting the sale deed executed. No steps whatsoever were ever taken by the plaintiff. Noticeably the plaintiff is a property broker and well versed with the laws of the land and also the market practices. She has been reluctant in disclosing her financial capacity, capability or credential. That she had the means and resources to pay the balance sale consideration has not been proved on record. The terms of agreement can be best construed by the conduct of the parties. It is true that agreement Ext.PA/1 stipulates a condition of construction of 5 mts. wide path opposite Dada Chela Ram Ashram and also a jeepable road near Fharmo Chemicose Ind. However, there is no mention that the same is a condition precedent for the execution of the sale deed. The conduct of the parties also does not reflect any such intention. 10 Whereas the agreement specifically provided for forfeiture/penalty in the event of failure of default in the execution of sale deed within the stipulated time, but no such term was agreed/stipulated as a consequence of failure to construct the road. The clause did not specify any period within which the same was to be constructed. The obligation on the defendant was not of such a nature so as to make the nature of the contract to be a continent contract. The obligation could have been performed within a reasonable time. In the present case, it cannot be said that the promisor was not bound to perform his part of the promise as there was no reciprocal promise upon the seller and promisee was not ready and willing to perform his part of the promise. In the present case no order in which the reciprocal promises were required to be performed were expressly fixed. The nature of transaction did not require the construction of the road prior to the execution of the sale deed. It is not that there was no access to the suit land and that the suit land could not have been utilized in the absence of the road. The limitation for the suit for recovery of the amount paid as part consideration in a contract for sale which was improperly declined to be completed, would be governed by Article 47 of the Limitation Act, 1963. I am forfeited to take this view by a decision rendered by a Division bench of Orissa High Court in N.V.Jagannadhayya v. Ramanatha Mohapatra, AIR 1955 Orissa 11 wherein under similar circumstances after considering the parameteria provisions contained in Article 97 of the Limitation Act, 1908 this view was taken. Similar view has also been taken by other High Courts in the following decisions:- 11 Gillu Teekan vs. Damodar Dass Shib Lal and another, AIR 1972 P&H 23; Harekrushna Patnaik and another vs. Damodar Biswal and others, AIR 1978 Orissa 118; Dhanraj Mills Ltd. Vs. Laxmi Cotton Traders, Bombay, AIR 1960 Bom.404, Mohammad Khan, Damoh vs. Surat Singh, Damoh, AIR 1963 MP 137 and Ram Lal Puri vs. Gokalnagar Sugar Mills Co., Ltd., AIR 1967 Delhi 91. The suit having been filed on 5.1.2004 was beyond the period of limitation. For the foregoing reasons, I find no merit in the appeal. There is no illegality or irregularity in the judgment and decree. The material has been considered by the Court below in its entirety. The appeal is accordingly dismissed. July 27, 2009 (Sanjay Karol) (C) Judge.