In Civil Appeal No.6075 Of 2023 -SC- Supreme Court restores judgment dismissing specific performance suit barred by limitation; emphasizes that the ‘law is hard, but it is the law’
Justice Vikram Nath & Justice Ahsanuddin Amanullah [22-09-2023]

Read Order: Sabbir (Dead) Through Lrs V. Anjuman (Since Deceased) Through Lrs

Chahat Varma

New Delhi, October 31, 2023: In a significant ruling, the Supreme Court has restored a judgment dismissing a specific performance suit, finding that the respondents had failed to prove their readiness and willingness to perform their part of the contract and that the suit was barred by limitation.

In the case at hand, an agreement to sell was executed by the appellants in favour of the respondents on 31.07.1975. The agreement stipulated that the appellants were to apply for permission to sell the property within eight days. Upon receiving permission, they were to inform the respondents, and the sale deed should be executed within 15 days. However, the appellants did not apply for permission to sell, leading to the respondents filing a suit for specific performance of the agreement. The Trial Court decreed the suit, but the First Appellate Court allowed the appellants' appeal. The respondents then filed a second appeal, which was granted by the Allahabad High Court. The case was subsequently remanded to the High Court, which, on 18.07.2018, again allowed the second appeal, overturning the First Appellate Court's findings.

The appellants argued that the Trial Court had misconstrued the facts and law in its decree. They contended that the First Appellate Court correctly reversed the Trial Court's decision, citing that the respondents had not taken any steps in five years, indicating they were not ready and willing to perform their part of the contract. They asserted that the suit was barred by limitation.

On the other hand, the respondents' counsel argued that the suit was filed within the limitation period because the appellants had not applied for permission and thus, no permission was ever obtained. Further they had not informed the respondents and therefore, the suit would not be hit by limitation.

The division bench of Justice Vikram Nath and Justice Ahsanuddin Amanullah, emphasized that the agreement to sell placed the onus on the appellants to apply for permission within eight days and inform the respondents upon receiving permission. If they failed to do so, the respondents had the right to seek court intervention. After the eighth day, the onus shifted to the respondents.

The bench found no valid reason for the respondents to wait for over five years before filing the suit. Furthermore, the respondents did not aver their readiness and willingness to fulfil their obligations under the agreement. The delay alone justified dismissing the suit based on limitation.

The bench also noted that the Limitation Act, 1963, prescribes a three-year limitation period for filing a specific performance suit from the date fixed for performance or the date of notice of performance refusal. The agreement in the present case was dated 31 July 1975, and the suit was filed on 1 January 1981.

The division bench, referring to Basawaraj v Land Acquisition Officer [LQ/SC/2013/914], emphasized that the law of limitation must be rigorously applied as prescribed by the statute and cannot be extended on equitable grounds. The result that arises from a statutory provision is not inherently negative. Even if the provision creates distress or inconvenience for a specific party, the court is obliged to enforce it to the fullest extent. The Latin legal maxim ‘dura lex sed lex’, which means ‘the law is hard, but it is the law’, is applicable in such situations. Inconvenience is not a determining factor in the interpretation of a statute.

Consequently, the court allowed the appeal, restoring the judgment and order passed by the First Appellate Court, which dismissed the suit.

Additionally, the court ordered the appellants to refund Rs. 1,000, paid by the respondents in 1975, with an adjusted lump-sum refund of Rs. 1,50,000, to be paid on or before 01.01.2024 to the respondents.