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2017 (9) TMI 1992

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..... even in the second appeal, provided the findings recorded by Courts below are found to be perverse. It has further been held in the case supra that there is no absolute bar on the re-appreciation of evidence in those proceedings; however, such a course is permissible in exceptional circumstances. In the instant case, this Court, after having carefully perused the communications Ex. PW-1/L to Ex./PW-1/O issued by the vendor, has no hesitation to conclude that the vendor had repeatedly extended time for execution of sale deed and at no point of time he conveyed to the plaintiff with regard to his intention, if any, of not selling the property in terms of original agreement Ex. PW-1/A. Since, after expiry of time period specified in agreements Ex. PW-1/A and Ex. PW-1/E, vendor himself had been requesting for extension of time coupled with the fact that the plaintiff had good relations with the vendor, there was no occasion, as such, for plaintiff to send communication specifically accepting therein the request for extension of time made by the vendor. Rather, it can safely be inferred from the communication sent by the vendor that requests, repeatedly made by him, were accepted an .....

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..... le Compound', as detailed in the judgment and decree of the learned trial Court. It is further averred by the plaintiff that he was inducted as a tenant by said Shri Raj Kumar Rajinder Singh in respect of residential premises in 'Padam Castle Compound' in the year 1966. It is the claim of the plaintiff that on 18.12.1973, Shri Raj Kumar Rajinder Singh agreed to sell the suit property to the plaintiff for Rs. 45,000/-, for which plaintiff had paid a part sale consideration of Rs. 10,000/- to Shri Raj Kumar Rajinder Singh. It is the claim of the plaintiff that he was already in possession of the suit property as tenant and his possession was deemed to have been surrendered in part performance of the agreement. It is further averred that balance sale consideration was agreed to be paid by the plaintiff at the time of registration of the sale deed. Subsequently, another agreement, dated 15.01.1975 was executed between them, when a further part of sale consideration was paid by the plaintiff to the vendor-predecessor-in-interest of the defendants (hereinafter referred to as the 'vendor'). Since the suit property was mortgaged by the vendor with the Himachal Pradesh S .....

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..... ars. So, limitation to sue, on the basis of agreements, dated 18.12.1973 and 15.01.1975, stands expired and they were not bound by the terms and conditions of the agreements. 4. By way of replication, plaintiff re-asserted his case, as set up in the plaint, controverting the stand taken by the defendants in the written statement and claimed that he has already paid Rs. 22,500/- in part performance of the agreement and is ready and willing to perform his part of the agreement. 5. On the pleadings of the parties, the learned trial Court framed the following issues:- 1. Whether the plaintiff is entitled for the relief of specific performance of agreement, as prayed? OPP. 2. Whether the plaintiff has become owner of suit property by way of adverse possession, as alleged? OPP. 3. Whether the plaintiff is entitled for the relief of injunction? OPP. 4. Whether the suit is barred by limitation? OPD. 5. Whether the suit is not maintainable? OPD. 6. Whether there is never valid transfer of title in favour of the plaintiff? OPD. 7. Whether the plaintiff is estopped from filing the present suit against the defendants, on account of his own acts, deeds and acquiescen .....

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..... ession of the plaintiff is not adverse? 8. Shri Bhupender Gupta, learned Senior Counsel representing the plaintiff-appellant, strenuously argued that the judgment and decree passed by both the Courts below are highly unjust, illegal, arbitrary, against the facts and law and as such deserve to be quashed and set aside. While inviting the attention of this Court to the judgment and decree passed by both the Courts below, learned Senior Counsel vehemently argued that there is absolute misconstruction of the agreements dated 18.12.1973 15.1.1975, Ex. PW-1/A Ex. PW-1/E respectively, by the Courts below while arriving at the conclusion that since the time limit for execution of the sale deed was specified in the agreements, therefore, the plaintiff ought to have instituted the suit within three years from the expiry of the said period specified in the agreements. Learned Senior Counsel further contended that both the Courts below have erred in concluding that time was essence of the contract by taking into consideration the recital in the agreements that maximum period for execution of the sale deed was specified as one year. Learned Senior Counsel further contended that correspo .....

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..... ounsel further contended that both the Courts below have committed grave error of jurisdiction in not taking into consideration the vital aspect of the matter that the sale deed was to be executed by the defendants in favour of the plaintiff in accordance with the agreements of sale, after getting the suit property redeemed from the bank. Learned Senior Counsel further contended that perusal of correspondence exchanged between the Attorney-cum-Secretary; namely; Shri Surat Ram Jhingta and the plaintiff clearly proves on record that mortgage was not got redeemed for a considerably long period of time, but both the Courts below took erroneous view of law that the plaintiff's suit was barred by limitation, since the plaintiff failed to explain reasons for not taking any action during such a long period. Mr. Gupta, learned Senior Counsel, further contended that sale deed was to be executed after redemption of the mortgage, but in the instant case, there is nothing on record suggestive of the fact that the defendants-respondents were ever able to prove on record that after redemption of mortgage, the plaintiff was intimated and called upon to get the sale deed executed. 11. Lastl .....

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..... was also to get the property redeemed from the bank and in the event of failure on the part of vendor to redeem the property within the aforesaid period and to execute the sale deed consequent thereto, he was liable to pay double the amount to the plaintiff. Learned counsel contended that bare perusal of terms/conditions contained in the agreements, referred herein above, clearly suggests that time was essence of contract inter se parties but since, within stipulated and agreed period of one year, neither property was redeemed nor sale deed was executed by the defendants, the plaintiff was well within his right to get his money refunded. While inviting the attention of this Court to Article 54 of the Limitation Act, learned counsel contended that suit for specific performance of agreement, if any, could be filed by the plaintiff within a period of three years from the date of expiry of one year period as stipulated in the agreements, referred hereinabove, and as such, there is no illegality and infirmity in the judgments and decrees passed by both the learned Courts below, which are definitely based upon proper appreciation of evidence adduced on record by the respective parties. .....

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..... gs of fact recorded by learned Courts below and as such same deserves to be quashed and set aside. 16. I have heard learned counsel for the parties and gone through the record of the case. 17. Since specific objection with regard to maintainability of present appeal, in view of concurrent findings of fact recorded by Courts below, has been taken by the defendants, this Court deems it necessary to deal with the same at first instance before exploring answer, if any, to the substantial questions of law formulated hereinabove. Though learned counsel representing the defendants has placed reliance upon the judgments, as have been taken note above, this Court deems it proper to take into consideration latest judgment passed by Hon'ble Apex Court in Laxmidevamma's case supra, wherein it has been held as under:- 16. Based on oral and documentary evidence, both the courts below have recorded concurrent findings of fact that the plaintiffs have established their right in A schedule property. In the light of the concurrent findings of fact, no substantial questions of law arose in the High Court and there was no substantial ground for reappreciation of evidence. While so, t .....

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..... in Sir Chunilal V. Mehta Sons Ltd. v. Century Spg. Mfg. Co. Ltd., AIR 1962 SC 1314, as also a number of other decisions on the point, this Court culled out three principles for determining whether a question of law raised in a case is substantial. One of the principles so summarised, is : (Hero Vinoth case, SCC p.556, para 24) 24.(iii) The general rule is that High Court will not interfere with the concurrent findings of the courts below. But it is not an absolute rule. Some of the well-recognized exceptions are where (i) the courts below have ignored material evidence or acted on no evidence; (ii) the courts have drawn wrong inferences from proved facts by applying the law erroneously; or (iii) the courts have wrongly cast the burden of proof. When we refer to 'decision based on no evidence', it not only refers to cases where there is a total dearth of evidence, but also refers to any case, where the evidence, taken as a whole, is not reasonably capable of supporting the finding . (p.294) 20. Hon'ble Apex Court in D.R. Rathna Murthy v. Ramappa, (2011)1 SCC 158, has specifically held that High Court can interfere with the findings of fact even in the secon .....

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..... 100 CPC relevant for this case may be summarised thus: (i) An inference of fact from the recitals or contents of a document is a question of fact. But the legal effect of the terms of a document is a question of law. Construction of a document involving the application of any principle of law, is also a question of law. Therefore, when there is misconstruction of a document or wrong application of a principle of law in construing a document, it gives rise to a question of law. (ii) The High Court should be satisfied that the case involves a substantial question of law, and not a mere question of law. A question of law having a material bearing on the decision of the case (that is, a question, answer to which affects the rights of parties to the suit) will be a substantial question of law, if it is not covered by any specific provisions of law or settled legal principle emerging from binding precedents, and, involves a debatable legal issue. A substantial question of law will also arise in a contrary situation, where the legal position is clear, either on account of express provisions of law or binding precedents, but the court below has decided the matter, either ignoring or .....

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..... dispute with regard to execution of agreements dated 18.12.1973 and 15.1.1975, Ex. PW-1/A and Ex./PW-1/E, as well as receipt of part consideration to the extent of Rs. 18,000/- by the predecessor-in-interest of the defendants from the plaintiff. In nutshell, the case of the plaintiff is that in furtherance of agreements Ex. PW-1/A and Ex. PW-1/E, part sale consideration was paid by the plaintiff and since property was mortgaged by the vendor in favour of Cooperative Bank, sale deed could only be executed after redemption of property in question. Since property came to be redeemed in the year 2001, plaintiff, being ready and willing to perform his part of agreement, claimed that he is entitled to relief of specific performance. Plaintiff further claimed that after redemption of property in the year 2001, he got issued notice Ex. PW-1/Q to the defendants, which was not answered, thereafter another legal notice Ex. PW-1/R was issued to the defendants which proves on the record, his readiness and willingness to execute the aforesaid agreements. Whereas, case of the defendants is that time was essence of the agreements, referred hereinabove, and same was valid for a maximum period of on .....

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..... ssion of the purchaser was to be considered as having been surrendered in part performance of the agreement. Vendor also agreed to handover vacant possession of one room in ground floor of 'Padam Castle Quarters', which was being used as office on or before 1st March, 1974 to the plaintiff. In terms of agreement, vendor was required to pay damages to the purchaser at the rate of Rs. 10/- per day, in the event of failure on his part to handover the vacant possession as agreed till the vacant possession is handed over to him. It also emerge from aforesaid agreement that vendor received an amount of Rs. 10,000/- at the time of execution of agreement i.e. 18.12.1973 with the further rider that purchaser i.e. the plaintiff would pay a further sum of Rs. 5,000/- to the vendor on or before 25th February, 1974. The remaining amount of Rs. 30,000/- was to be paid by the purchaser to the vendor at the time of registration of document of sale of the aforesaid property. Contents of agreement further suggest that the purchaser i.e. the plaintiff was not liable to pay any rent to the vendor of the premises in his occupation including a room, the possession whereof was to be given on or b .....

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..... liged to execute sale deed on or before 15.1.1976 i.e. within one year from the date of agreement dated 15.1.1975 Ex. PW-1/E. Ex. PW-1/G is receipt of Rs. 3000/-, issued by the vendor, having been received by him towards sale consideration in terms of agreement dated 15.1.1975. Similarly, vide Ex. PW-1/H, receipt dated 25.2.1974 issued by the vender, an amount of Rs. 5000/- was received by him on account of consideration in terms of agreement dated 18.12.1973. Most importantly, there are two receipts dated 12.4.1977 and 25.2.1978, Ex. PW-1/J Ex. PW-1/K, issued by GPA of the vendor amounting to Rs. 1000/- and Rs. 2000/- respectively having been received by vendor on account of advance in terms of agreement to sell 'Padam Castle Quarters' and land. Vide communication dated 27.12.1975, Ex. PW-1/L, the vendor, while inviting the attention of the plaintiff to the agreement executed inter se plaintiff and GPA of the vendor on 15.1.1975, again made a request that period of one year may be given to him so that by that time property is redeemed and sale deed is executed. Vide aforesaid letter, period of agreement was extended for further one year from 16.1.1976. Vide aforesaid com .....

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..... Hence, finding of the Courts below that extension of time, as referred in documents Ex. PW-1/C, Ex. PW-1/M and Ex. PW-1/O, is unilateral extension, does not appear to be correct, rather, as has been taken note above by this Court after having perused Ex. PZ i.e. communication dated 8.6.1973, it clearly emerge from the record that the plaintiff had good relations with the vendor, who had been taking financial help from the plaintiff from time to time. Learned Courts below, taking note of admission having been made by the plaintiff, while appearing as PW-1, in his cross-examination that he never expressed his acceptance to the defendants qua the letters Ex. PW-1/C, Ex. PW-1/M and Ex. PW-1/O, also came to the conclusion that it cannot be said that term of the agreements, Ex. PW-1/A and Ex. PW-1/E, was extended by the vendor after expiry of period mentioned therein. 33. True, it is that there is no letter/communication either written by vendor himself or through his attorney after 25.2.1978 suggestive of the fact that time was further sought to be extended by him for execution of sale deed in terms of agreements Ex. PW-1/A and Ex. PW-1/E, but, similarly there is no document led on .....

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..... umbent upon the defendants to produce peon book, especially when factum with regard to delivery of letter dated 20.6.1992 was specifically denied by the plaintiff. Since aforesaid document was not legally proved on record, the Courts below erred in concluding that suit is barred by limitation. Moreover, letter was issued by GPA of the vendor Shri Raj Kumar Rajinder Singh and since GPA and vendor were not available to prove the contents of letter, statement having been made by DW-1 Rajeshwar Singh was required to be dealt with carefully by the Courts below while ascertaining the factum with regard to issuance of letter dated 20.6.1992. DW-1 in his cross-examination categorically admitted that he does not know whether Ex. DW-1/A stands entered in register or not. He also admitted that there are no signatures of the plaintiff on Ex. DW-1/A. 35. After having carefully perused documents Ex. PW-1/L to Ex. PW-1/P; this Court finds substantial force in the arguments of Shri Bhupender Gupta, learned Senior Counsel representing the plaintiff, that date for performance, which was initially stipulated in Ex. PW-1/A and Ex. PW-1/E, was repeatedly extended by the vendor and as such plaintiff .....

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..... of Wards, AIR 1938 Lah. 23, also the court was concerned with Article 113 of the Limitation Act, 1908. A suit for specific performance was brought on an agreement of sale where the time for performance of the contract was after passing of a decree . Though no date for performance was fixed for the agreement, the trial Court had opined that time must be held to have begun to run from the date on which the decree was passed in view of the maxim certum est quod certum reddi potest ( That is sufficiently certain which can be made certain ). The Lahore High Court was of the view that statutes of limitation must be strictly construed and that the respondents before it had failed to bring a case specifically within the purview of the first part of Article 113 and that the case did not fall within the first part but fell within the second part of Article 113. The judgment of the Allahabad High Court in Kashi Prasad was approvingly referred to and followed. This judgment was taken in appeal before the Privy Council and approved by the Privy Council in Lala Ram Sarup v. Court of Wards, AIR 1940 PC 19. 20. In Kruttiventi Mallikharjuna Rao v. Vemuri Pardhasaradhirao, AIR 1944 Mad. 218, a c .....

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..... ing within the second part of Article 54 of the Limitation Act, 1963. 26. P. Sivan Muthiah v. John Sathiavasagam, (1990)1 MLJ 490, arose from a suit for specific performance with an alternative prayer for recovery of advance paid under the agreement of sale. Referring to Article 54 of the Limitation Act, 1963 the court took the view that the expression date fixed could mean either the date expressly fixed or the date that can be fixed with reference to a future event, which is certain to happen. If the date is to be ascertained depending upon an event which is not certain to happen, the first part of Article 54 would not be applicable, and in such an eventuality, it is only the latter part of Article 54 that could be invoked by treating it as a case in which no date had been fixed for performance and the limitation would be three years from the date when the plaintiff had notice that performance is refused. This was a case where performance was due after the tenants in the property had been vacated. The court took the view that since eviction of the tenants was an uncertain event, the time must be deemed to have run only from the date when the plaintiffs had notice that the pe .....

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..... d by limitation. (pp. 772-775) 37. Hon'ble Apex Court in Panchanan Dhara and Others v. Monmatha Nath Maity (Dead) Through LRs. and Another, (2006)5 SCC 340, has specifically held that a plea of limitation is a mixed question of law and fact. The question as to whether a suit for specific performance of contract will be barred by limitation or not would not only depend upon the nature of the agreement but also on the conduct of the parties and also as to how they understood the terms and conditions of the agreement. In this judgment, Hon'ble Apex Court has further held that while determining the applicability of the first or the second part of Article 54 of the Limitation Act, 1963, the court will firstly see as to whether any time was fixed for performance of the agreement of sale and if it was so fixed, whether the suit was filed beyond the prescribed period unless any case of extension of time for performance was pleaded and established. When, however, no time is fixed for performance of contract, the court may determine the date on which the plaintiff had notice of refusal on the part of the defendant to perform the contract and in that event the suit is requir .....

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..... 4 of the Limitation Act would show that the period of limitation begins to run from the date on which the contract was to be specifically performed. In terms of Article 54 of the Limitation Act, the period prescribed therein shall begin from the date fixed for the performance of the contract. The contract is to be performed by both the parties to the agreement. In this case, the first respondent was to offer the balance amount to the Company, which would be subject to its showing that it had a perfect title over the property. We have noticed hereinbefore that the courts below arrived at a finding of fact that the period of performance of the agreement has been extended. Extension of (sic time for performance of a) contract is not necessarily to be inferred from written document. It could be implied also. The conduct of the parties in this behalf is relevant. Once a finding of fact has been arrived at, that the time for performance of the said contract had been extended by the parties, the time to file a suit shall be deemed to start running only when the plaintiff had notice that performance had been refused. Performance of the said contract was refused by the Company only on 21.8. .....

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..... nal agreements after expiry of period as mentioned in agreement dated 15.1.1975 Ex. PW-1/E, this Court is inclined to accept the contention having been put forth by learned Senior Counsel representing the plaintiff that question whether suit for specific performance is barred by limitation or not would not only depend upon nature of the agreement but also on the conduct of the parties. 40. In the instant case, this Court, after having carefully perused the communications Ex. PW-1/L to Ex./PW-1/O issued by the vendor, has no hesitation to conclude that the vendor had repeatedly extended time for execution of sale deed and at no point of time he conveyed to the plaintiff with regard to his intention, if any, of not selling the property in terms of original agreement Ex. PW-1/A. Since, after expiry of time period specified in agreements Ex. PW-1/A and Ex. PW-1/E, vendor himself had been requesting for extension of time coupled with the fact that the plaintiff had good relations with the vendor, there was no occasion, as such, for plaintiff to send communication specifically accepting therein the request for extension of time made by the vendor. Rather, it can safely be inferred fro .....

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..... ty redeemed within aforesaid period i.e. one year, plaintiff is/was well within its right to receive double the amount given by him in advance. Conjoint reading of conditions contained in paras 5 and 6 nowhere suggests that sale deed in terms of agreement, was to be executed strictly within a period of one year, rather within a period of one year, vendor was bound to get the property redeemed and thereafter he had to execute the sale deed. True, it is that in the event of failure on the part of vendor to redeem the property within the period as prescribed in para-5 of the agreement, purchaser i.e. plaintiff is/was entitled to receive double the amount advanced by him to the vendor. But, by no stretch of imagination, it can be said that sale deed could only be executed within a period of one year from the date of agreement i.e. 18.12.1973, rather execution of sale deed was subject to redemption of the property, which vendor had agreed to get redeemed within a period of one year. 43. Similarly, perusal of agreement, dated 15.1.1975, Ex. PW-1/E, suggests that since vendor failed to get the property redeemed from the Co-operative Bank, it was agreed inter se parties in furtherance o .....

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..... nt of advance paid by him, but, it is/was not open for the vendor, after expiry of one year from the date of agreement, to claim that the party is/was not liable to execute the sale deed in terms of agreement. Hence, this Court has no hesitation to conclude that both the Courts below, while dismissing the suit of the plaintiff, misconstrued, misinterpreted and misread the terms and conditions of agreements to sell Ex. PW-1/A and Ex. PW-1/E, while coming to the conclusion that time was essence of the contract. 46. In the instant case, as clearly emerge from bare reading of agreements, referred hereinabove, limitation for filing suit was required to be computed from the date when factum with regard to redemption of property was either conveyed to the purchaser by vendor or from the date when the plaintiff acquired knowledge of redemption of property by the vendor. Since, in the instant case, sale deed was to be executed within one year from the date of redemption of the property, as has been held above, Courts below ought to have decided issue of limitation, taking into consideration date of redemption of property mortgaged with the Cooperative Bank. 47. At the cost of repetiti .....

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..... Pushparani S. Sundaram and Others v. Pauline Manomani James (Deceased) and Others, (2002)9 SCC 582, wherein the Hon'ble Court has held as under:- 5. For this, the appellants rely on two circumstances, one that immediately after the exemption was given by the Ceiling Authorities on the 31.3.1982, the present suit was filed in April, 1982, and the other the tendering of further sum of Rs. 5,000/- to the defendant after execution of the agreement of sale. He also reiterates with reference to Para 11 of the plaint which pleads that the appellant was and is ready and willing to perform his part of the contract. So far these are being a plea that they were ready and willing to perform their part of the contract is there in the pleading. We have no hesitation to conclude, that this by itself is not sufficient to hold that the appellants were ready and willing in terms of Section 16(c) of the Specific Relief Act. This requires not only such plea but also proof of the same. Now examining first of the two circumstances, how could mere filing of this suit, after exemption was granted could be a circumstance about willingness or readiness of the plaintiff. This at the most could be th .....

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..... f 1877 which lays down that the person seeking specific performance of the contract, must file a suit wherein he must allege and prove that he has performed or has been ready and willing to perform the essential terms of the contract, which are to be performed by him. The specific performance of the contract cannot be enforced in favour of the person who fails to aver and prove his readiness and willingness to perform essential terms of the contract. Explanation (ii) to clause (c) of Section 16 further makes it clear that plaintiff must aver performance of, or readiness and willingness to perform, the contract according to its true construction. The compliance of the requirement of Section 16(c) is mandatory and in the absence of proof of the same that the plaintiff has been ready and willing to perform his part of the contract suit cannot succeed. The first requirement is that he must aver in plaint and thereafter prove those averments made in the plaint. The plaintiff's readiness and willingness must be in accordance with the terms of the agreement. The readiness and willingness of the plaintiff to perform the essential part of the contract would be required to be demonstrate .....

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..... us solely for the reasons that construction, if any, raised by the defendants was on the property adjoining to the suit property and not on the property intended to be sold by the vendor by way of agreements Ex. PW-1/A and Ex. PW-1/E. Plaintiff himself in his plaint has stated that since defendants started raising construction over the land adjoining to suit property, he apprehended that suit property stands redeemed, but fact remains that the suit property came to be redeemed only in the year 2001. 53. PW-3, Shri Ramesh Chand, who at that relevant time was Manager, H.P. State Cooperative Bank, Rampur Bushahr, in his statement recorded on 15.1.2003 categorically stated that as per record, the vendor; namely; Raj Kumar Rajinder Singh, had taken loan on 18.9.1964, which was cleared on 8.9.2001. He also stated that property named as 'Padam Castle, Rajesh Cottage and Padam Cottage' stood mortgaged with the bank and it was redeemed on 8.9.2001. Even in his cross-examination, he categorically admitted that loan account of the vendor was closed on 8.9.2001. There is nothing in his cross-examination from where it can be inferred that the defendants were able to extract anything .....

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..... me has been marked as 'mark-B' dated 28.5.1988 available at page 119 of record, which itself suggests that even till 28.5.1988 defendants had been acknowledging that they have executed agreement to sell with the plaintiff to sell the property in question. Vide aforesaid communication defendants have also acknowledged that they have received Rs. 19,000/- in total. 56. Hence, this Court, after having bestowed its thoughtful consideration to the pleadings, evidence vis- -vis impugned judgments and decrees passed by both the Courts below, is of the view that both the Courts below erred in concluding that suit for specific performance having been filed by the plaintiff is/was barred by limitation. Findings returned by Courts below, after having interpreted conditions contained in Ex. PW-1/A and Ex. PW-1/E as well as correspondence Ex. PW-1/L, Ex. PW-1/M and Ex. PW-1/O, are erroneous and as such being not based upon proper appreciation of evidence deserve to be quashed and set aside. Both the Courts below also erred in concluding that plaintiff was not ready and willing to perform his part of contract because after having perused Ex. PW-1/Q and Ex. PW-1/R it is quite apparent .....

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