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1908 DIGILAW 18 (SC)

AMNA BIBI v. UDITNARAIN MISRA

1908-11-10

LORD ATKINSON, LORD MACNAGHTEN, SIR ANDREW SCOBLE, SIR ARTHUR WILSON

body1908
Judgement Consolidated Appeals from four decrees of the High Court. The decrees in the first two cases were dated January 18, 1900, and affirmed the decrees of the Subordinate Judge of Gorakhpur dated April 24, 1897. In the two last cases decrees of the High Court (April 30, 1903) reversed decrees of the Subordinate Judge (September 27, 1900). Prior to the suits one Dhunmun Das had obtained in 1895 a decree of foreclosure against the defendant Uditnarain on a mortgage executed by him in 1890, and in 1896 Uditnarain and his son executed another mortgage in favour of Dhunmun. The said Dhunmun Das also obtained in 1895 a decree of foreclosure on two mortgages executed in 1890 by the defendant Sarju Pershad, and in 1896 Sarju executed a third mortgage in favour of Dhunmun. All these debts were discharged by payments made by Maulvi Muhammad Minnat Ullah on September 15, 1896, on agreements made by him with the respective mortgagors that sale deeds would be executed in respect of the villages comprised in the mortgage deeds within one month, at the rate of Rs. 6.0 profits per cent, per annum according to the Government rent rolls. These deeds were not executed, and accordingly on December 10, 1896, Maulvi Muhammad Minnat Ullah brought two suits against Uditnarain and his son and Sarju respectively. He alleged as a condition of the agreements that sale deeds were to be executed within a month, and claimed a refund of the money paid by him with interest at the rate of 24 per cent, per annum in consequence of the failure to complete within that period. The defence in each case was that the period of one month was not a term of the contract, that a corrected rent roll had been attested by the Collector as soon as possible, and that there had been no refusal to complete. Both suits were dismissed, the Courts holding that time was not of the essence of the contract. On April 16, 1900, the said plaintiff brought two fresh suits against the same defendants, praying for specific performance of the agreements of September 15, 1896, or in the alternative for a refund of the moneys paid with interest. The defence in each case was that the suit for money was barred by limitation; that the suit was also barred by the pro visions of ss. The defence in each case was that the suit for money was barred by limitation; that the suit was also barred by the pro visions of ss. 12, 13, and 43 of the Code of Civil Procedure; and that the price to be paid was determinate on the basis of the actual rent roll and not the Government rent roll, which was admittedly incorrect. The Subordinate Judge held that the suits were not barred by limitation or the said sections of the Civil Procedure Code. He was of opinion that Maulvi Minnat Ullah was entitled to specific performance of the agreements to sell, the price being calculated on the basis of the Government rent rolls and not on the actual rental. He accordingly made two decrees for specific performance. The High Court in appeal (( 1903) I. L. R. 25 Allah. 618.) reversed these decrees. The learned judges stated that in view of the conflict of testimony they were not satisfied as to what the contract really was, and could not therefore give a decree for specific performance. They held, however, that the Statute of Limitation was no bar to the suit, and in support of this finding referred to the case of Basso Kuar v. Dhum Singh. (( 1888) L. R. 15 Ind. Ap. 211.) They concluded as follows— " This is a clear authority in support of the appellants contention that if the contract in this case is not specifically enforceable he is entitled to a refund of the money which was paid as part of the consideration for the purchase. There was undoubtedly an agreement for sale. The money in question was admittedly paid as part of the consideration for the sale. Owing to the conflict in the evidence and to the fact that the defendants insisted that there was a term in the contract which does not appear in the documents to which we have referred, and to their insistence on the enforcement of the agreement according to their version of it, the contract has not been carried out. The plaintiff has throughout expressed his willingness to abandon the contract altogether or to perform it according to the terms appearing in the documents which we have mentioned. The plaintiff has throughout expressed his willingness to abandon the contract altogether or to perform it according to the terms appearing in the documents which we have mentioned. He has gone further and at the outset of the hearing of this appeal expressed his willingness to accept the defendants version of the agreement provided that a definite sum was named by the defendants as the price payable according to their contention; but this offer has been rejected. We are wholly unable upon the evidence to say with any degree of certainty what the terms of the contract were, and we, therefore, cannot make a decree for specific performance. The agreement is not one which, in the view which we take, this Court ought to or can enforce, and we so declare. This being our view it necessarily follows that the defendants must repay to the plaintiff the money which he paid in part satisfaction of the purchase-money. The Statute of Limitation does not bar the claim for the recovery of the money, inasmuch as there was an existing consideration for the payment which has only not failed by reason of our judgment that the contract is not enforceable. We are bound to apply to the case article 97 of the Limitation Act in view of the decision of their Lordships of the Privy Council in the case to which we have referred. According to it the limitation begins to run from the date of the failure of the consideration. In this case the consideration fails from the present time by reason of the pronouncement of .the Court that the contract is riot legally enforceable. The suit, therefore, so far as regards the alternative relief prayed for? is not barred by limitation, and we are glad to be able, consistently with what justice and fair dealing dictate, to give the plaintiff-respondent that relief that is the alternative relief claimed in his plaint. He is not entitled to a decree for specific performance, and in that respect the decree of the lower Court will be set aside and instead we dismiss the plaintiffs claim for specific performance. They accordingly gave decrees for refund of the moneys paid with interest at 6 per cent, per annum from September 15, 1896. He is not entitled to a decree for specific performance, and in that respect the decree of the lower Court will be set aside and instead we dismiss the plaintiffs claim for specific performance. They accordingly gave decrees for refund of the moneys paid with interest at 6 per cent, per annum from September 15, 1896. Ross, for the appellants in the first two appeals, contended that the Courts below were wrong in holding that time was not of the essence of the contracts and that the plaintiff was not entitled to rescind them on the failure of the defendants to complete within the time stipulated. The circumstances shewed that the stipulated period of one month was intended to be a binding condition on breach of which the contracts were at an end. He relied upon s. 55 of the Contract Act (IX. of 1872). With regard to the last two appeals he submitted that the High Court was right and that the suits were not barred either by limitation or the rule of res judicata. As the contract was void for uncertainty, the plaintiff was entitled to recover back the moneys paid by him, the consideration having failed and the cause of action having accrued at the date of the contracts being declared void and not enforceable. De Gruyther, K.C., and Dube, for the respondents in the first appeals and the appellants in the latter appeals, contended that the contracts could not be rescinded under the said s. 55, time not being of the essence thereof. As regards limitation reference was made to art. 113 of Sched. II. of Act XV. of 1877, which prescribes a period of three years from the date fixed for performance, i.e., from the expiry of the said month. The same period and the same date of the cause of action were applicable to the prayer for refund of moneys paid. The consideration failed when the contracts were broken. They referred to s. 65 of the Contract Act and to arts. 97 and 120 of the Limitation Act. They also relied on ss. 12,13, and 43 of the Civil Procedure Code. The judgment of their Lordships was delivered by LORD MACNAGHTEN. Their Lordships are of opinion that the judgment of the High Court is quite right. They will therefore humbly advise His Majesty that the appeals and the cross-appeals ought all to be dismissed. They also relied on ss. 12,13, and 43 of the Civil Procedure Code. The judgment of their Lordships was delivered by LORD MACNAGHTEN. Their Lordships are of opinion that the judgment of the High Court is quite right. They will therefore humbly advise His Majesty that the appeals and the cross-appeals ought all to be dismissed. The parties will bear their own costs of their respective appeals.