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PETITIONER: AJAIB SINGH

       Vs.

RESPONDENT: GURBAX SINGH & ORS.

DATE OF JUDGMENT17/11/1987

BENCH: MUKHARJI, SABYASACHI (J) BENCH: MUKHARJI, SABYASACHI (J) OZA, G.L. (J)

CITATION:  1988 SCR  (1)1099        1988 SCC  (1) 143  JT 1987 (4)   516        1987 SCALE  (2)1045

ACT:      Indian Contract  Act, 1872:  Agreement of sale-Specific performance of-Major  portion of  sale price  paid by buyer- Possession of  property with  buyer in  part performance  of agreement-Documents of  title  not  executed-Limitation  bar pleaded-Held  High   Court   erred   in   denying   specific performance on  account of hardship without deciding whether claim was barred by limitation.

HEADNOTE: %      Under an  agreement of sale entered into by respondents the appellant had paid the major portion of the agreed price long time ago and the balance thereof that was to be paid at the time  of execution  of the documents was a sum of Rs. 75 only. Possession  of the premises was with the appellant for all these years in part performance of the agreement.      Upon failure of the respondents to execute documents of title, the  appellant sought  specific  performance  of  the agreement.  The   respondents  canvassed   the  question  of limitation before  the High  Court. The High Court, however, without deciding  that question  took the  view that  due to passage of  time prices of lands had gone up sky high and it would be unjust to enforce the agreement of sale.      Allowing the appeal by special leave, ^      HELD: The  High Court  exercised  discretion  on  wrong principles. Without  deciding the question whether the claim of  the  plaintiff  was  barred  by  limitation  or  not  it proceeded to  refuse to  grant the relief on the ground that there has  been good  deal of  delay and  the parties  would suffer if specific performance of the agreement was granted. This principle  was not  applicable to the facts of the case and the  exercise of  discretion was  not proper. The matter remanded to  the High  Court for decision in merits. [1100G; E; 1101B]      Madamsetty Satyanarayana  v. G.  Yellogi  Rao  &  Ors., [1965] 2 SCR 221; Dr. Jiwan Lal & Ors. v. Brij Mohan Mehra & Anr., [1973]  2 SCR 230 and Debendra Nath Mandal v. Sakhilal Kar & Ors., AIR 1950 Calcutta 526, referred to. 1100

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JUDGMENT:      CIVIL APPELLATE  JURISDICTION: Civil Appeal No. 3066 of 1987.      From the  Judgment and  Order  dated  9.7.1986  of  the Punjab and Haryana High Court in R.S.A. No. 163 of 1978.           Mala  Ram  Ghana  and  Dalveer  Bhandari  for  the Appellant.           M.S.  Gujral   and  Dr.  Meera  Aggarwal  for  the Respondents.           The Judgment of the Court was delivered by           SABYASACHI MUKHARJI, J. Special leave granted.      The High  Court in  its judgment  and order  dated  9th July, 1986, has observed that the question of limitation has been  canvassed  before  the  High  Court.  The  High  Court expressed the  view that there was a lot of conflict between the various  High Courts on the interpretation of Article 54 of  the   Limitation  Act   which  governed   the  point  of limitation. The  High Court,  however, did  not decide  this question and  expressed the view that due to passage of time prices of  lands had gone up sky-high and it would be unjust to enforce  the agreement  of sale  entered into.  In  other words, it appears that without deciding the question whether the claim  of the plaintiff was barred by limitation or not, the High Court exercised its discretion in refusing to grant the relief  on the  ground that  there has been good deal of delay and  the parties  would suffer if specific performance of the agreement was granted. It appears from the facts that in this  case the major portion of the agreed price had been paid long time ago and the balance thereof was to be paid at the time  of execution  of the documents was a sum of Rs. 75 only. It further appears that possession of the premises was with the  appellant for  all these years in part performance of the agreement. In those circumstances, the principle upon which the  High Court refused to exercise its discretion, in our opinion,  was not applicable and such discretion was not proper.  The   High  Court  exercised  discretion  on  wrong principles. See  in this connection Madamsetty Satyanarayana v. G.  Yellogi Rao & Two others, [1965] 2 SCR 221; Dr. Jiwan Lal &  Ors. v.  Brij Mohan Mehra & Another, [1973] 2 SCR 230 and see  also the  observation in  Debendra Nath  Mandal  v. Sakhilal Kar & Ors., AIR 1950 Calcutta 526      In that  view of  the matter,  we  cannot  sustain  the exercise of discretion in the manner done by the High Court. This, however, does 1101 not decide  the matter because the High Court declined to go into the  facts and  decide the  question of  limitation  on merits, the  High Court  took the  view in  exercise of  its discretion. Since  we are  not sustaining  the High  Court’s exercise of  discretion hence  the order and the Judgment of the High  Court are  set aside but the matter is remanded to the High  Court for  its decision  on the merits. The matter should be  disposed  of  by  the  High  Court  as  early  as possible. The appeal is accordingly allowed with no order as to costs. P.S.S.                                       Appeal allowed. 1102