Clause On Validity Of Agreement For Sale Does Not Change The Date Fixed For Performance: Supreme Court
The Supreme Court held that the clause regarding validity of the agreement for sale is something different and does not change the date fixed for the performance.
The Court was hearing an Appeal against the judgment and order passed by the High Court that confirmed the judgment and decree of the First Appellate Court decreeing the Suit for Specific Performance.
The bench of Justice Vikram Nath and Justice Prasanna B. Varale observed, “The validity of the agreement is something different and does not change the date of performance. What was the reason for incorporating this clause of validating the agreement for five years is not spelled out in the agreement, but in any case, it does not change the date fixed for the performance.”
Brief Facts-
The plot in the dispute originally belonged to Kisun Ram. The plot was subdivided and a part of it went to Bihari Lal whose heirs are the defendants. Bihari Lal agreed to sell the land and superstructure to the plaintiff but the sale deed was not executed within nine months as agreed. It is the case of the plaintiffs that the remaining amount was paid and there was a new agreement. Despite another agreement, the sale deed remained unexecuted therefore the plaintiffs, who had been given possession, sued for specific performance. The Trial Court dismissed the suit for being barred by limitation. The plaintiffs’ appeal was allowed, directing the defendants to execute the sale deed. The defendants’ second appeal to the High Court was dismissed which led to the present appeal.
The Court noted that once there is a specific date fixed for performance, the limitation period would be three years from the said date.
The Court said that the reliance placed by the first Appellate Court and High Court on the clause that said that the agreement would remain valid for five years from the date of the execution of the agreement to sell is irrelevant.
The Court said that the suit was liable to be dismissed on the grounds of limitation alone.
Accordingly, the Court set aside the impugned order and allowed the Appeal.
Cause Title: Usha Devi v. Ram Kumar Singh (Neutral Citation: 2024 INSC 599)