Specific performance limitation and readiness: courts must read agreement terms and conduct together where performance depends on mortgage redemption.

In a specific performance dispute, limitation under Article 54 was held to run from the point when performance became due after redemption of the mortgaged property, not rigidly from the original agreement date, where the agreements and subsequent conduct showed repeated extensions and continued acknowledgment of the contract. Readiness and willingness under Section 16(c) was treated as established through prompt notices demanding execution of the sale deed and offering payment of the balance consideration at registration. The plaintiff's possession was also found to be referable to the agreement to sell rather than mere tenancy, as the agreements contemplated surrender of tenant possession in part performance.

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Issues: (i) whether the suit for specific performance was barred by limitation under Article 54 of the Limitation Act, 1963 in view of the terms of the agreements and the subsequent conduct of the parties; (ii) whether the plaintiff had proved readiness and willingness to perform his part of the contract under Section 16(c) of the Specific Relief Act, 1963; (iii) whether the plaintiff's possession was to be treated as that of a tenant or under the agreement to sell.

Issue (i): whether the suit for specific performance was barred by limitation under Article 54 of the Limitation Act, 1963 in view of the terms of the agreements and the subsequent conduct of the parties.

Analysis: The agreements stipulated that the vendor was first to redeem the mortgaged property and thereafter execute the sale deed. The Court held that the stipulated period related to redemption and that execution of sale deed was dependent on such redemption. The correspondence and receipts on record showed repeated extensions of time and continued acknowledgment of the agreement and consideration, so the contractual timeline was not to be read as rigidly expiring after one year. The alleged refusal letter of 1992 was not proved in accordance with law, while the property was in fact redeemed only in 2001. On these facts, limitation could not be computed from the original agreement date.

Conclusion: The suit was not barred by limitation and the finding to the contrary was set aside in favour of the appellant.

Issue (ii): whether the plaintiff had proved readiness and willingness to perform his part of the contract under Section 16(c) of the Specific Relief Act, 1963.

Analysis: The plaintiff pleaded readiness and willingness and supported that plea by issuing notices immediately after learning of redemption of the property, calling upon the defendants to execute the sale deed and stating that the balance consideration would be paid at the time of registration. The Court treated these communications as consistent with performance of the contractual obligation and rejected the view that there was no proof of readiness and willingness.

Conclusion: Readiness and willingness stood proved in favour of the appellant.

Issue (iii): whether the plaintiff's possession was to be treated as that of a tenant or under the agreement to sell.

Analysis: The agreements themselves recorded that the plaintiff's existing possession as tenant was to be treated as surrendered in part performance of the agreement to sell. The Court found that the courts below had misread the agreements and the surrounding material in treating the plaintiff's possession as merely that of a tenant.

Conclusion: The finding that the plaintiff remained only a tenant was erroneous and was reversed in favour of the appellant.

Final Conclusion: The concurrent findings of the courts below were held to be perverse for misreading the agreements and the evidence, and the plaintiff was granted specific performance of the contract.

Ratio Decidendi: In a suit for specific performance, where the agreement and the parties' conduct show extension of time and performance depends on an antecedent event such as redemption of a mortgage, limitation under Article 54 is computed from refusal or from the point when performance becomes due after that event, and readiness and willingness may be established by prompt contractual notices and surrounding conduct.

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