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2017 (9) TMI 1992

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....gh, predecessor-in-interest of the defendants, was the owner of the suit property comprised in 'Padam Castle 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 referre....

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....- to the plaintiff. It is further averred that construction work of the defendants was in progress for five years. 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? ....

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....status of the plaintiff-appellant over the suit property is in the capacity of tenant? 6. Whether the findings of the courts below are illegal, erroneous and perverse in holding that the possession 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 ....

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....illegal and perverse because cause of action, if any, accrued to the plaintiff for filing the suit from the expiry of the time specified in notice dated 19.10.2001, Ex. PW-1/R. 10. Learned Senior Counsel 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 ....

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....ed was specifically specified in the agreements. Learned counsel further contended that vide aforesaid agreements, sale deed was to be executed within a period of one year, during which period vendor 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 illeg....

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....dyarthi, (2009)3 SCC 287, (2000)3 SCC 708 and Laxmidevamma and Others v. Ranganath and Others, (2015)4 SCC 264, forcibly contended that present appeal is not maintainable, in view of concurrent findings 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....

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....ner of Customs, New Delhi, (2011)7 SCC 289, wherein the Hon'ble Apex Court has held as under:- "14. In Hero Vinoth v. Seshammal, (2006)5 SCC 545, referring to the Constitution Bench decision of this Court 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....

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....on the judgment of this Court in Hero Vinoth v. Seshammal, (2006)5 SCC 545, wherein the principles relating to Section 100 of the CPC were summarized in para 24, which is extracted below : (SCC pp. 55556) "24. The principles relating to Section 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, involve....

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....ments passed by Courts below are wholly perverse, is ascertained. 24. Keeping in view the contents and text of substantial questions of law, reproduced hereinabove, this Court intends to take all substantial questions of law together as they are interconnected. 25. There is no 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 n....

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....mately 336 square yards vacant site. It also emerge from the agreement that the plaintiff, who happened to be a purchaser, was already in occupation of three rooms, one bathroom and one latrine in the ground floor of the 'Padam Castle Quarters' agreed to be sold and the possession 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 tim....

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....maximum period of one year, the vendor shall be liable to pay a sum of Rs. 36,000/-, being double the amount of the sum already paid by the purchaser to the vendor, and a further sum of Rs. 3,000/- as special damages. 30. In terms of agreements, referred hereinabove, vendor was obliged 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 plainti....

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....milarly, perusal of Ex. PW-1/G, PW-1/H, Ex. PW-1/J and Ex. PW-1/K further suggests that the plaintiff had been depositing certain amounts, after expiry of time as specified in agreement Ex. PW-1/A, which were duly acknowledged by the vendor in communications Ex. PW-1/L to Ex. PW-1/O. 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 lett....

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....e the factum with regard to issuance of letter by Shri Surat Ram Jhingta nor receipt, if any, by the plaintiff; namely; Shiv Saran Dass. Since it was admitted case of the defendants that letter dated 20.6.1992 Ex. DW-1/A was got served upon the plaintiff through peon book, it was incumbent 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. ....

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....hered from surrounding circumstances of the case. It must be a date clearly mentioned in the contract whether the said contract be oral or in writing. 19. In Alopi Parshad v. Court 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 P....

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...., was raised. Noticing the fact that there was absence of any indication as to when the attachment would be raised, the court treated it as a case in which no date was fixed for performance of the contract and, therefore, falling 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 ....

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....vacated when the original suit was initially dismissed, and the review application came to be dismissed on 22.3.1986, it was held that it was a situation covered by the first part of Article 54 and, in any event, on 25.8.1989 the suit was barred 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 ple....

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....uld be honored. In a suit for specific performance of contract in respect of any immovable property, time would ordinarily not be the essence of the contract. The appellant herein also did not raise any plea to the said effect. 22. A bare perusal of Article 54 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....

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....Ex. PW-1/A. It is also not in dispute that in lieu of repeated extensions asked for by the vendor, certain amount was paid by the plaintiff towards sale consideration, as agreed in agreements. Since, the vendor kept on extending period for execution of sale deed in terms of original 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 exten....

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.... property, hence this Court sees valid reasons to differ with the findings returned by both the Courts below that time was essence of the contract. Similarly, condition contained in para-6 of the agreement suggests that in the event of failure on the part of the vendor to get the suit property 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 o....

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.... dependant upon the redemption of property. This Court, after having carefully perused the aforesaid agreements, is of the view that vendee i.e. plaintiff after completion of one year in the event of non-execution of sale deed in terms of agreement referred above could always claim double the amount 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 ca....

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....ount in terms of agreement is to be paid at the time of execution of the sale deed; meaning thereby that by sending aforesaid communication, he expressed his readiness and willingness to get the sale deed executed. In this regard reliance is placed upon the judgment of Hon'ble Supreme Court in 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....

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.... and willingness on the part of the plaintiff. 49. Hon'ble Apex Court in Bal Krishan & Anr. v. Bhagwan Dass (Dead) by L.Rs & Ors, AIR 2008 SC 1786 has held as under:- "8. Section 16 of the Specific Relief Act, 1963 (hereinafter referred to as 'the Act') corresponds with Section 24 of the old Act of 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 require....

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....the year 1996 by the defendants and as such factum, if any, with regard to redemption of property had come to the knowledge of the plaintiff in the year 1996 and as such he could have filed the suit up to year 1999. 52. Aforesaid findings having been returned by the learned first appellate Court appear to be totally erroneous 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 C....

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....en observed above, aforesaid communication dated 2.6.1992 was never proved in accordance with law and thus no reliance, if any, could be placed on the same by the Courts below while determining the period of limitation on the basis of same. This Court could lay its hand to one document which is though not exhibited, but the same 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-à-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. ....