Summary
The Supreme Court restored dismissal of a specific-performance suit filed about five and a half years after the sale agreement. The agreement expressly allowed court enforcement if the vendors failed to apply for permission within eight days, so the purchasers could not wait indefinitely for permission and intimation. Their unexplained delay and deficient pleading of readiness reinforced the limitation conclusion. A lump-sum refund of Rs 1,50,000 was ordered for the Rs 1,000 earnest payment.
Issues
- When did enforcement rights arise under the agreement’s permission and default clauses?
- Whether the delayed suit was barred by Article 54.
- What refund was due after refusal of specific performance.
Provisions considered
- Schedule, Article 54, Limitation Act, 1963The Court applied the three-year period, read with the agreement’s express enforcement right on failure to seek permission within eight days, and held the delayed suit barred. (¶¶ 10, 11, 12)
Held
- Read together, the agreement required the vendors to apply for permission within eight days and separately allowed enforcement if they failed either to apply or to intimate permission after receiving it. The first failure itself activated the purchasers’ right to move the court from the ninth day; they could not defer action indefinitely awaiting permission. (¶¶ 10, 11)
- No valid explanation justified waiting about five and a half years. The pleading of requests to execute the deed did not clearly aver readiness and willingness to pay the balance and perform the purchasers’ obligations. On these pleadings and contractual terms, the suit was barred by limitation. (¶¶ 11, 12)
- Statutory limitation could not be enlarged merely on equitable grounds. The High Court’s specific-performance decree therefore had to yield to the first appellate judgment dismissing the suit. (¶¶ 12, 13)
- The earnest payment was refundable. Taking account of elapsed time, the Court fixed the lump-sum refund at Rs 1,50,000, payable by the appellants to the respondents on or before 1 January 2024. (¶ 14)
Result
Appeal allowed without costs. High Court judgment set aside and first appellate dismissal of the suit restored. Appellants directed to pay respondents Rs 1,50,000 by 1 January 2024 as lump-sum refund.