URVASHIBEN & ANR. versus KRISHNAKANT MANUPRASAD TRIVEDI
[2018] 13 S.C.R. 1242, Supreme Court of India, 2018
Outcome: Leave Granted & Dismissed (Dismissed)
Segment: Facts
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URVASHIBEN & ANR.
v.
KRISHNAKANT MANUPRASAD TRIVEDI
(Civil Appeal Nos. 12070-71 of 2018)
DECEMBER 14, 2018
[UDAY UMESH LALIT AND R. SUBHASH REDDY, JJ.]
Code of Civil Procedure, 1908 – Or.VII, r.11(d) – Rejection
of plaint on the ground that suit was barred by limitation –
Respondent-plaintiff case was that the predecessor-in-title of the
appellants-defendants had agreed to sell the suit property to him
and executed agreement to sell for a sale consideration – Time was
not the essence of the contract – Total consideration amount was
paid by the respondent – Respondent visited the property after about
25 years and found that the suit property was sold to third party –
Suit filed for specific performance of agreement to sell by the
respondent – Appellant-defendant filed application u/Or.VII, r.11(d)
of CPC to reject the plaint on the ground that suit was barred by
limitation – Application allowed by the trial Court – However, order
was set aside by the High Court – On appeal, held: When rejection
of plaint is sought in an application filed u/Or.VII, r.11 same is to be
considered from the facts of each case, looking at the averments
made in the plaint, for the purpose of adjudicating such application
– In instant case, it is a matter for trial to record correctness or
otherwise of allegations made in the plaint – The merits and demerits
of the matter cannot be gone into, while deciding the application
filed u/Or.VII,
r.11 of CPC – At this stage only averments in the
plaint are to be looked into and from a reading of the averments in
the plaint in case on hand, it cannot be said that suit was barred by
limitation – Furthermore, it is settled that when the time is not fixed
in the agreement, the limitation of three years to file a suit for
specific performance would begin when the plaintiff has noticed
that defendant has refused the performance of the agreement – The
issue as to when the plaintiff  had noticed refusal, is an issue which
can be adjudicated after trial – Limitation Act, 1963 – Art.54.
Dismissing the appeals, the Court
HELD: 1.  From a reading of the Article 54 of Limitation
Act, 1963, it is clear that when the date is fixed for performance,
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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 when
the plaintiff, has notice of refusal.  When rejection of plaint is
sought in an application filed under O.VII R.11, same is to be
considered from the facts of each case, looking at the averments
made in the plaint, for the purpose of adjudicating such application.
As averred in the plaint, it is the case of the plaintiff that even
after payment of the entire consideration amount registration of
the document was not made and prolonged on some grounds and
ultimately when he had visited the site, he had come to know
that the same land was sold to third parties and appellants have
refused performance of contract. In such event, it is a matter for
trial to record correctness or otherwise of such allegation made
in the plaint.  In the suits for specific performance falling in the
second limb of the Article, period of three years is to be counted
from the date when it had come to the notice of the plaintiff that
performance is refused by the defendants.  For the purpose of
cause of action and limitation when it is pleaded that when he had
visited the site, he had come to know that the sale was made in
favour of third parties and the appellants have refused to execute
the Sale Deed in which event same is a case for adjudication after
trial but not a case for rejection of plaint under O.VII R.11(d) of
CPC. [Para 12][1249-D-G]
2. In
cases falling in second limb of Article 54, finding can
be recorded only after recording evidence. Furthermore, when
the time is not fixed in the agreement, the limitation of three
years to file a suit for specific performance would begin when the
plaintiff has noticed that defendant has refused the performance
of the agreement. [Para 14][1251-E-F]
3.  In the instant case, the merits and demerits of the matter
cannot be gone into at this stage, while deciding an application
filed under O.VII R.11 of the CPC.  It is fairly well settled that at
this stage only averments in the plaint are to be looked into and
from 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 to
when the plaintiff had noticed refusal, is an issue which can be
adjudicated after trial.  Even assuming that there is inordinate
delay and laches on the part of the plaintiff, same cannot be a
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ground for rejection of plaint under O.VII R.11(d) of CPC.
[Para 15][1252-A-C]
Gunwantbhai Mulchand Shah & Ors. v. Anton Elis
Farel & Ors.(2006) 3 SCC 634 : [2006] 2 SCR 886;
Rathnavathi & Anr. v. Kavita Ganashamdas (2015) 5
SCC 223 ; Balsaria Construction (P) Ltd. v. Hanuman
Seva Trust & Ors.(2006) 5 SCC 658 ; Chhotanben &
Anr. v. Kiritbhai Jalkrushnabhai Thakkar & Ors.(2018)
6 SCC 422 : [2018] 3 SCR 422 – relied on.
Prabhakar v. Joint Director, Sericulture Department &
Anr. (2015) 15 SCC 1 ; T. Arivandandam v. T.V. Satyapal
& Anr (1977) 4 SCC 467 : [1978] 1 SCR 742 ; Hardesh
Ores (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. Debts
Recovery Appellate Tribunal & Ors.(1998) 2 SCC 70 :
[1997] 6 Suppl. SCR 683 ; Raj Narain Sarin (Dead)
through LRs. & Ors. V. Laxmi Devi & Ors. (2002) 10
SCC 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 Chandra
Murthy v. Syed Jalal (2017) 13 SCC 174 : [2017] 5
SCR 294 ; Church of Christ Charitable Trust &
Educational Charitable Society v. Ponniamman
Educational Trust (2012) 8 SCC 706 : [2012] 6 SCR
404 ; Madina Begum & Anr. v. Shiv Murti Prasad
Pandey & Ors. (2016) 15 SCC 322 : [2016] 5 SCR
92 ; Ahmadsahab Abdul Mulla(2)(Dead) by Proposed
LRs. v.
Bibijan & Ors. (2009) 5 SCC 462 : [2009] 5
SCR 476 – referred to.
Case Law Reference
(2015) 15 SCC 1
referred to
Para 7
[1978] 1 SCR 742
referred to
Para 7
[2007] 6 SCR 608
referred to
Para 7
[2000] 3 Suppl.SCR 214
referred to
Para 7
[1997] 6 Suppl. SCR 683
referred to
Para 7
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(2002) 10 SCC 501
referred to
Para 7
[2005] 1 Suppl. SCR 411
referred to
Para 7
[2017] 5 SCR 294
referred to
Para 7
 [2012] 6 SCR 404
referred to
Para 7
[2006] 2 SCR 886
relied on
Para 8
(2015) 5 SCC 223
relied on
Para 8
[2016] 5 SCR 92
referred to
Para 8
[2018] 3 SCR 422
relied on
Para 8
[2009] 5 SCR 476
referred to
Para 14
(2006) 5 SCC 658
relied on
Para 14
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 12070-
12071 of 2018.
From the Judgment and Order dated 10.07.2018 of the High Court
of Gujarat at Ahmedabad in First Appeal No. 160 of 2018 with Civil
Application No. 1 of 2018.
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.Monisha
Handa, Mohit D. Ram, Advs. for the Respondent.
The Judgment of the Court was delivered by
R. SUBHASH REDDY, J.
1. Leave granted.
2. These civil appeals are preferred by the defendants in Civil
Suit No.930 of 2017, on the file of the City Civil Court, Ahmedabad,
aggrieved by the judgment and decree of the High Court of Gujarat
dated 10.07.2018 passed in Regular First Appeal No.160 of 2018 and
Civil Application No.1 of 2018.
3. The respondent-plaintiff has filed Civil Suit No.930 of 2017 for
specific performance of the Agreement to Sell dated 13.03.1992 with
regard to suit schedule property, i.e. Final Plot No.147 of Town Planning
Scheme No.3 of Mouje Shekhpur-Khanpur of
Ahmedabad, admeasuring
2821 Sq.Mtrs.  It is the case of the plaintiff that the predecessor-in-title
of the appellant-defendants, one Chaitanyabhai Patel, had agreed to sell
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the suit schedule property to him and execute Agreement of Sale / Sale
Deed for a sale consideration of Rs.32 lacs.  The total consideration
amount of Rs.32 lacs was paid during the period from 15.01.1990 to
05.09.1991.  It is stated that such payments are acknowledged by
vouchers.  It was the case of the respondent-plaintiff that, time was not
the essence of the contract, and citing financial problems, the Sale Deed
was not executed.  It is alleged that deceased Chaitanyabhai Patel has
given trust and belief that he will execute the Sale Deed.  However,
recently when the respondent-plaintiff had visited the suit schedule
property on 25.05.2017 he has come to know that the said property was
sold to third party in view of increase in prices.  It is alleged in the plaint
that the appellant-defendants have expressed that they will not execute
the Sale Deed.  Hence, the suit is filed.
4. In the aforesaid suit, the appellant-defendants have filed
application 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.
The said application was contested by the respondent herein.  However,
trial court, by order dated 27.12.2017, allowed the application and ordered
to reject the plaint.
5. As against the same, respondent-plaintiff preferred Regular
First Appeal No.160 of 2018 before the High Court of Gujarat at
Ahmedabad.  By the judgment and decree
dated 10.07.2018, the High
Court has allowed the appeal filed by the respondent by setting aside the
order of the trial court dated 27.12.2017.  As against the same, these
civil appeals are filed.
6. We have heard Sri Anshin H. Desai, learned senior counsel for
the appellants and Sh. Dushyant Dave, learned senior counsel for the
respondent-plaintiff.
7. In these appeals, it is contended by Sri Desai, learned senior
counsel appearing for the appellants that the alleged Agreement to Sell
is dated 13.03.1992 and the suit is filed in the year 2017, i.e., after a
period of 25 years and even according to the case of the respondent-
plaintiff there is no communication at all in between the period from
1992 to 2017.  It is submitted that except stating that he had visited the
site on 25.05.2017 on which date he has come to know the said plot is
sold to third parties, there is nothing on record to show that the suit is
within limitation.  Referring to Article 54 of the Limitation Act, 1963 it is
contended by learned counsel that even in absence of prescribing time
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for executing the Sale Deed, the period of three years is to be computed
from the date of refusal.  It is submitted that by waiting for a period of
25 years and by merely stating that he had visited the site on 25.05.2017
on 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, vexatious
and ex-facie barred by limitation.  It is contended that even in absence
of fixing any period for executing the Sale Deed, it is not open to
respondent-plaintiff to file the suit after 25 years of alleged Sale Deed /
Agreement to Sell.  It is further stated that the so-called Agreement to
Sell is unregistered one, not supported by any payments through cheque.
Vaguely stating that entire amount of consideration is paid, by way of
cash during the period from 15.01.1990 to 05.09.1991, the said suit is
filed.  It is contended by learned counsel that a well reasoned order
passed by the trial court is set aside by the High Court without recording
any justifiable reasons.  In support of his case for rejection of plaint
under O.VII R.11, learned counsel has placed reliance on judgment of
this Court in the case of Prabhakar v. Joint Director, Sericulture
Department & 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. Debts
Recovery 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; Madanuri
Sri Rama Chandra Murthy v. Syed Jalal8 and in the case of Church
of Christ Charitable Trust & Educational Charitable Society v.
Ponniamman Educational Trust9.
8. On the other hand Sh. Dushant Dave, learned senior counsel
appearing for the respondent has submitted that the appellant-defendants
sought rejection of the plaint under O.VII R.11(d) of the CPC only on
the ground that suit is barred by limitation.  It is the contention by the
learned counsel that undisputedly time was not the essence of the contract,
1(2015) 15 SCC 1
2(1977) 4 SCC 467
3(2007) 5 SCC 614
4(2000) 7 SCC 702
5(1998) 2 SCC 70
6(2002) 10 SCC 501
7(2005) 5 SCC 548
8(2017) 13 SCC 174
9(2012) 8 SCC 706
URVASHIBEN & ANR. v. KRISHNAKANT MANUPRASAD
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in which event as per Article 54 of the Limitation Act 1963, the period of
limitation is three years from the date of refusal.  It is submitted that the
limitation being a mixed question of fact and law, whether the suit is filed
within 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 for
rejection of the plaint at this stage.  It is submitted that for the purpose of
considering the application under O.VII R.11(d), plain averments in the
plaint are to be seen and no other ground can be a ground for rejection
of the plaint, under O.VII R.11(d).  It is submitted that whether, from the
averments in the plaint in a given case, plaint is to be rejected or not
under O.VII R.11, is to be considered with reference to facts of each
case and from the case on hand, it cannot be said that suit is barred by
limitation, only by looking at the averments in the plaint.  Learned counsel
has contended that all the citations by learned counsel for the appellants
are not applicable to the facts of the case on hand and, in support of his
arguments, reliance is placed in the case of Gunwantbhai Mulchand
Shah & Ors. v. Anton Elis Farel & Ors.10; Rathnavathi & Anr. v.
Kavita Ganashamdas11; Madina Begum & Anr. v. Shiv Murti Prasad
Pandey & Ors.12 and Chhotanben & Anr. v. Kiritbhai
Jalkrushnabhai Thakkar & Ors.13.
9. Having heard learned counsel on both
sides, we have perused
the order passed by the trial court as well as the High Court and other
material placed on record.
10. The trial court has allowed the application filed by the appellant-
defendants, by holding a finding that respondent-plaintiff, by clever
drafting, has created illusion of cause of action and stated that cause of
action has arisen on 25.05.2017, but he failed to give justifiable explanation
for unreasonable delay in filing the suit.  Trial court further held that
when 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 rejection
under O.VII R.11(d) of CPC.  The High Court has set aside the order of
the trial court by recording a finding that going by the plain averments in
the suit, it cannot be stated that the same is barred by limitation.
10(2006) 3 SCC 634
11(2015) 5 SCC 223
12(2016) 15 SCC 322
13(2018) 6 SCC 422
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11. It is fairly well settled that, so far as the issue of limitation is
concerned, it is a mixed question of fact and law.  It is true that limitation
can be the ground for rejection of plaint in exercise of powers under
O.VII R.11(d) of the CPC.  Equally, it is well settled that for the purpose
of deciding application filed under O.VII R.11 only averments stated in
the plaint alone can be looked into, merits and demerits of the matter and
the allegations by the parties cannot be gone into.  Article 54 of the
Limitation Act, 1963 prescribes the limitation of three years, for suits for
specific performance.  The said Article reads as under :
12. From a reading of the aforesaid Article, 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 when the plaintiff, has notice of refusal.  When rejection
of plaint is sought in an application filed under O.VII R.11, same is to be
considered from the facts of each case, looking at the averments made
in the plaint, for the purpose of adjudicating such application.  As averred
in the plaint, it is the case of the plaintiff that even after payment of the
entire consideration amount registration of the document was not made
and prolonged on some grounds and ultimately when he had visited the
site on 25.05.2017 he had come to know that the same land was sold to
third parties and appellants
have refused performance of contract. In
such event, it is a matter for trial to record correctness or otherwise of
such allegation made in the plaint.  In the suits for specific performance
falling in the second limb of the Article, period of three years is to be
counted from the date when it had come to the notice of the plaintiff that
performance is refused by the defendants.  For the purpose of cause of
action and limitation when it is pleaded that when he had visited the site
on 25.05.2017 he had come to know that the sale was made in favour of
third parties and the appellants have refused to execute the Sale Deed in
which event same is a case for adjudication after trial but not a case for
rejection of plaint under O.VII R.11(d) of CPC.
13. Counsel for the appellants has placed reliance on the judgment
in the case of Prabhakar (supra). In the above said case, this Court has
held that, even where no limitation period is prescribed by the Statute,
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courts apply doctrine of delay/laches/acquiescence and non-suit litigants
who approach court belatedly without justifiable explanation.  Delay and
laches are to be examined with reference to facts of each case and the
said judgment is not helpful to support the case of the appellant inasmuch
as this matter arises out of an application filed under O.VII R.11(d) of
the CPC.  The judgment in the case of T. Arivandandam (supra) pertains
to eviction from tenanted premises which was contested by the tenant.
In the said case where rejection of plaint under O.VII R.11(d) was
considered on the ground that plaint does not disclose cause of action
but not a case for rejection of plaint on the ground of limitation.  In the
case of Hardesh Ores (supra) it was the case falling in the first limb of
Article 54 of the Limitation Act 1963 but not a case falling under second
limb, where the time is not the essence of the contract.  In the judgment
in the case of Dilboo (Dead) (supra) this Court has considered relevant
principles of applicability of O.VII R.11 of CPC.  Equally, the case of
I.T.C. Limited (supra) is a case concerning rejection of plaint under
O.VII R.11(a) but not case of rejection on the ground of limitation.  In
the case of Raj Narain Sarin (supra) the suit was filed after 40 years
after execution of the Sale Deed and as a fact it was found that Sale
Deed was to the knowledge of the plaintiff and he had not taken any
steps to  declare the Sale Deed invalid.  In that context, the order passed
under O.VII R.11 was confirmed by this Court.  In the case of N.V.
Srinivasa (supra) the suit is for declaration but not for specific
performance and in the said suit having regard to the facts of the case
this Court has held that suit for declaration filed by the plaintiff is not
maintainable.  In the case of Madanuri Rama (supra) the suit was filed
seeking cancellation of Sale Deed on the ground that property in question
is a waqf property which cannot be sold to a private party.  The aforesaid
case is a case not concerning limitation under Article 54 of the Limitation
Act 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 question
of limitation has been dealt with by the courts below is highly
unsatisfactory.  It was rightly noticed that the suit was governed
by Article 54 of the Limitation Act, 1963.  Then, the enquiry should
have been, first, whether any time was fixed for performance in
the agreement for sale, and if it was so fixed, to hold that a suit
filed beyond thre years of the date was barred by limitation unless
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any case of extension was pleaded and established.  But in a case
where no time for performance was fixed, the court had to find
the date on which the plaintiff had notice that the performance
was refused and on finding that date, to see whether the suit was
filed within three years thereof.  We have explained the position
in the recent decision in R.K. Parvtharaj Gupta v. K.C. Jayadeva
Reddy (2002) 2 SCC 428.  In the case on hand, there is no dispute
that 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 finding
that the plaintiffs had notice that the defendants were refusing
performance of the agreement.  In a case of that nature normally,
the question of limitation could be decided only after taking evidence
and recording a finding as to the date on which the plaintiff had
such notice.  We are not unmindful of the fact that a statement
appears to have been filed on behalf of the plaintiffs that they did
not want to lead any evidence. The defendants, of course, took
the stand that they also did not want to lead any evidence.  As we
see it, the trial court should have insisted on the parties leading
evidence on this question or the court ought to have postponed
the consideration of the issue of limitation along with the other
issues arising in the suit, after a trial.”
In the aforesaid case, it is clearly held that in cases falling in
second limb of Article 54 finding can be recorded
only after recording
evidence.  The said view expressed by this Court supports the case of
the respondent-plaintiff.  In the judgment in the case of Rathnavathi
(supra) in paragraphs 42 and 43 it was clearly held that when the time is
not fixed in the agreement, the limitation of three years to file a suit for
specific performance would begin when the plaintiff has noticed that
defendant has refused the performance of the agreement.  In the judgment
in the case of Ahmadsahab Abdul Mulla(2)(Dead) by Proposed LRs.
v. Bibijan & Ors.14 while interpreting Article 54 of the Limitation Act, it
is held that words “date fixed for the performance” is a crystallised
notion.  The second part “time from which period begins to run” refers
to a case where no such date is fixed.  In the case of Balsaria
Construction (P) Ltd. v. Hanuman Seva Trust & Ors.15 and
Chhotanben  (supra) this Court clearly held that issue of limitation,
being a mixed question of fact and law, is to be decided only after
evidence is adduced.
14(2009) 5 SCC 462
15(2006) 5 SCC 658
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15. By applying the aforesaid principles in the judgments relied on
by Sri Dushyant Dave, learned senior counsel appearing for the
respondent, we are of the considered view that merits and demerits of
the matter cannot be gone into at this stage, while deciding an application
filed under O.VII R.11 of the CPC.  It is fairly well settled that at this
stage only averments in the plaint are to be looked into and from 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 to when the plaintiff had noticed
refusal, is an issue which can be adjudicated after trial.  Even assuming
that there is inordinate delay and laches on the part of the plaintiff, same
cannot be a ground for rejection of plaint under O.VII R.11(d) of CPC.
16. For the aforesaid reasons, we do not find any illegality in the
judgment of the High Court, so as to interfere with the same in these
appeals.  Accordingly, these appeals are dismissed, being devoid of merit,
with no order as to costs.  We make it clear that we have not expressed
any opinion on the merits of the matter, including on the issue of limitation.
It 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 of
the year 1992, trial court to dispose of the suit, as expeditiously, as possible.
Ankit Gyan
Appeals dismissed.