Calcutta High Court: In an appeal revolving around a dispute regarding a specific performance of a contract for a property transaction, a single-judge bench comprising of Siddhartha Roy Chowdhury,* J., held that the suit for specific performance was filed outside the period of limitation according to Article 54 of the Limitation Act, 1963. Moreover, the respondents have no title to transfer the property as per a prior compromise decree, rendering the specific performance of the contract unenforceable.
Brief Facts
In the instant matter, the respondent filed a suit for specific performance of a contract against the defendants-appellants. The suit property was allegedly jointly owned by the defendants, and they agreed to sell it to the plaintiff-respondents for Rs. 75,000. The agreement for sale was executed on 15-02-1993 and registered.
The defendants granted power of attorney to the plaintiff to take steps to vacate the property from tenants or occupants. Based on this power of attorney, the defendants filed two separate title suits. After the defendants failed to execute the deed of conveyance upon receipt of the balance consideration money of Rs. 53,900, the plaintiff filed the suit, which was contested by the defendants.
The trial court issued a decree in favor of the Plaintiff, ordering specific performance of the contract. Defendant 11 appealed this decision to the First Appellate Court, challenging the service of notice and the validity of the agreement which was rejected.
Aggrieved by the First Appellate Court’s rejection, the appellant-defendant 11 filed a second appeal on the grounds that the suit was barred by limitation, the vendors lacked the title to transfer the property, and he was not served notice.
Question of Law
The second appeal was admitted on the substantial questions of law.
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Whether the courts below were justified in passing a decree for specific performance when the title in the suit property of the defendants could not be established?
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Whether the findings of both lower courts that in the absence of a registered deed, the right, title, and interest of the defendants could not be re-conveyed to the original owners are perverse?
The second appeal was considered in the context of the limitation issue since no formal question of law was framed.
Parties’ Contentions
The appellant contended that the vendors had no title to transfer, as the property was mortgaged and released through a compromise decree. It was contended that the suit was barred by limitation as it should have been filed within two years from the date of the agreement.
The respondent contended that the compromise decree was collusive and not binding on them. It was further contended that they had no control over the time taken for the suit’s disposal, and therefore, the suit was not time-barred.
Court’s Decision
The Court stated that a simple arithmetic calculation shows that the suit ought to have been filed sometime in the first part of the month of February 1998 whereas the suit was filed in the year 2001.
The court ruled in favor of the appellant and stated that the suit was barred by limitation as it should have been filed within two years from the date of the agreement, but it was filed in 2001, well beyond the prescribed period. The Court held that the suit was filed outside the period of limitation according to Article 54 of the Limitation Act, 1963.
The Court also found that, due to a prior compromise decree, the defendants (respondent 2 and 3) had no title to transfer the property, rendering the specific performance of the contract unenforceable.
The Court set aside the judgment and decree passed by the First Appellate Court and dismissed the appeal against respondent 1. The Court directed the appellants (defendants 2 and 3) to pay a sum of Rs. 21,100 to the plaintiff along with interest at a rate of 9% per annum within four weeks, or the plaintiff could proceed with the execution of the decree.
[Raman Srivastav v. Sk. Wahider Rahaman, 2023 SCC OnLine Cal 3518, order dated 11-10-2023]
*Judgment by Justice Siddhartha Roy Chowdhury
Advocates who appeared in this case :
Mr. Ayan Banerjee, Mr. Abhishek Verma, Mr. Ritobrata Singha, Counsel for the Appellant
Mr. Prasenjit Biswas, Counsel for the Respondents