THE HON’BLE SRI JUSTICE K.G. SHANKAR A.S.No.1244 of 1992 Date: 18.11.2011 Between: Repalle Nancharamma and 6 others … Appellants/ Plaintiffs AND Jangala Venkata Subbamma and 4 others … Respondents/ Defendants THE HON’BLE SRI JUSTICE K.G. SHANKAR A.S.No.1244 of 1992 JUDGMENT: One Narayana Rao entered into an agreement of sale with the defendant Nos.1 to 4 and the husband of the fifth defendant under Ex.A.1 to purchase Ac.2.22 cents of land situate in R.S.Nos.344 and 345 at Vuyyuru Village and Mandal, Krishna District. As Narayana Rao died, subsequently, his wife and two sons filed the suit in O.S.No.203 of 1984 on the file of the Sub-Court, Gudivada for specific performance of the agreement of sale. After the filing of the appeal, the third appellant/third plaintiff, who was quite young, died. His legal representatives were brought on record as appellants 4 to 7. The fourth defendant, who is the fourth respondent, also died. He has no legal representatives. As such, no one was brought on record as the legal representatives of the fourth respondent-fourth defendant. 2. The suit was dismissed by the learned trial Judge on the only ground that the claim was barred by limitation. The point for consideration is whether the plaintiffs are entitled to the decree as prayed for. 3. The defendants entered into agreement of sale with Narayana Rao under Ex.A.1 on 30.05.1970. Narayana Rao agreed to purchase the plaint schedule property at a total sum of ` 17,900/-. He made a part payment of ` 2,000/- on 30.05.1970. Ex.A.1 contains a recital that the plaintiffs themselves pay the balance within one month, i.e., on or before 30.06.1970 and should obtain a sale deed. The default clause was to the effect that in the event the agreement holder did not pay the balance of the sale consideration, the agreement holder should pay interest at 12% per annum on the balance amount. 4. Sri Gudiseva Narasimha Rao, learned counsel for the plaintiffs contended that time was not the essence of the contract under Ex.A.1. He submitted that the defendants received part payments. I shall refer to the part payments a little later. More important, Ex.A.1 does not contain a condition that if the agreement holder failed to pay the money covered by the agreement within a specified time, the agreement would stand cancelled. On the other hand, Ex.A.1 did not speak anything about the cancellation of the agreement of sale. It merely embodies a condition that the agreement holder would become liable to pay interest at 12% per annum on the balance due. Consequently, I agree with the contention of the learned counsel for the plaintiffs that time was not the essence of the contract under Ex.A.1. 5. Another side of the case is Exs.A.2 to A.9. Exs.A.2 to A.9 are endorsements on Ex.A.1-agreement of sale when part payments were made by Narayana Rao. Exs.A.8 and A.9 are disputed by the second defendant. That part of the contention shall be examined later. The primary point is that in 1971, 1972 and in 1975, the defendants received part payments from Narayana Rao, vide Exs.A.2 to A.7 endorsements. It is the contention of the learned counsel for the plaintiffs that the defendants also received payments in 1978 under Exs.A.8 and A.9 endorsements. The very fact that the defendants admittedly received part payments in 1971, 1972 and 1975 would show that time was not the essence of the contract, lest the defendants would not have and should not have received part payments under Exs.A.2 to A.7 or Exs.A.2 to A.9. 6. It may be noticed that defendants 1, 4 and 5 remained ex parte. The third defendant filed written statement admitting the claim of the plaintiffs and requesting that the suit be decreed without costs. It is only the second defendant who is contesting the case. The second defendant denied the part payments covered by Exs.A.8 and A.9. He further contended that the suit is barred by limitation. 7. The trial Judge framed three issues. Issue No.2 relates to limitation. The trial Court held that the suit is barred by limitation and that the suit, consequently, was dismissed. 8. The learned counsel for the plaintiffs contended that the suit was well within the time in view of Article 54 of the Limitation Act. The learned counsel for the plaintiffs did not place reliance upon Exs.A.8 and A.9 to determine the period of limitation of three years. The plaintiffs issued a notice under Ex.A.10 to the defendants demanding execution of the sale deed. The defendants received the notice through Exs.A.11 to A.15. Only the defendants 2 and 3 replied Ex.A.10- notice. Ex.A.16 is the reply of the second defendant. Ex.A.17 is the reply of the third defendant. The second defendant in his reply dated 21.07.1981 contended that the plaintiffs are not entitled to the specific performance as prayed for. 9. It is Ex.A.16, which is submitted by the learned counsel for the plaintiffs to be the date for the purpose of limitation contending that the defendants made clear their intentions not to perform the contract only through Exs.A.16 and A.17 reply notices. 10. The second defendant is DW.1. He admitted the payments under Exs.A.2 to A.7. Thus, the second defendant admitted accepting payments after the date mentioned in Ex.A.1 (viz., 30.06.1970). It automatically indicates that time was not the essence of the contract and that the defendants were willing to perform their part of the contract at any time that the plaintiffs choose. Consequently, denial of Exs.A.8 and 9 have very little significance. The point is that the second defendant denied specific performance on 21.07.1981, through his reply. I agree with the contention of the learned counsel for the plaintiffs that the date for the purpose of computation is the date on which the defendants refusing to perform their part of the agreement. It was observed in K. Sambasiva Rao v. P. Bangaru Raju that time could not be the essence of contract where the defendants received amounts covered by the contract beyond the period of six months mentioned in the agreement of sale. At any rate, it is not the primary contention of the second defendant that the payments under Exs.A.8 and A.9 are not true and that the agreement became unenforceable. His contention is that as the last payment was in 1975, the agreement under Ex.A.1 became unenforceable in 1983. Even if the payments under Exs.A.8 and A.9 in 1978 are accepted, the suit would be more than three years from the date of the payments under Exs.A.8 and A.9. 11. However, the date relevant to compute the period of limitation is the date of Ex.A.16. Ex.A.16 is the reply by the second defendant under which he denied to perform his part of the agreement of sale. Consequently, 21.07.1981 shall be computed to be the date on which limitation commences for the purpose of computing the period under Article 54 of the Limitation Act. As the suit was filed in 1984, from the date of Ex.A.16, the suit was within time. As already noticed, the only ground on which the learned trial Judge dismissed the suit is on the ground of period of limitation. The trial Court held that Exs.A.8 and A.9 were true. They were not questioned by the second defendant, through cross objections. Consequently, the question about the truth or otherwise of the payments, covered by Exs.A.8 and A.9, cannot be gone into in this appeal. 12. The only question in the appeal is whether the suit is barred by limitation. Where limitation commenced from the date of Ex.A.16 on 21.07.1981, the suit is found to be well within time. The suit is, therefore, liable to be decreed. 13. The period of limitation under Article 54 commences from the date of denial as already pointed out. The date of denial could be the date on which the defendants replied the notice stating that they need not perform their part of the agreement of sale as the contract outlived itself. Consequently, Ex.A.16 shall be computed to be the date from which the limitation commences to run. 14. The next question is whether specific performance deserves to be ordered or the plaintiffs would be entitled to refund of the monies paid by them. There is nothing on record to refuse specific performance of the agreement of sale in favour of the plaintiffs. I, therefore, consider that the plaintiffs shall be entitled to specific performance of agreement of sale. 15. The payments till Ex.A.9 shall indeed be given credit to, but the plaintiffs should be liable to pay the balance, however, with interest at 12% per annum from the date of Ex.A.9 till the date of payment or deposit in the Court. On such deposit, the defendants would be liable to execute the sale deed in favour of the plaintiffs, if the plaintiffs are ready. 16. Accordingly, the Appeal Suit is allowed. The plaintiffs are entitled to specific performance of the agreement of sale. The plaintiffs shall deposit the balance of the amount due within a period of one month from today to the credit of the case calculating the same together with interest at 12% per annum from the date of Ex.A.9 till the date of deposit. On such deposit, the plaintiffs shall be entitled to specific performance of the agreement of sale. The defendants shall execute the sale deed in favour of the plaintiffs or their nominees. If the defendants do not so execute the sale deed, after the plaintiffs fulfil their obligation, the plaintiffs shall be entitled to seek for the execution of the decree by way of execution of the sale deed in favour of the plaintiffs by the defendants. There shall, however, be no order as to costs. _________________ K.G. SHANKAR, J Date: 18.11.2011 Isn