RAMDAYAL Vs. PURSHOTTAM PANNALAL

JUDGEMENT

(1.) IN this second appeal by the defendants from the concurrent judgments of the lower courts, the only material point at this stage is one on the law of limitation, which can be stated thus: There is a contract for the sale of property within a period specified in the agreement, with simultaneous payment of the price by the intending purchaser. Both parties are aware that the sale cannot take place legally, unless a particular authority sanctions it. Accordingly, at the instance of the intending purchaser the intending vendor applies for the permission immediately after the execution of the contract. The proceedings for permission are disposed of long after the term mentioned in the agreement and the order is one refusing it. In a suit for the recovery of the price by the would-be purchaser, does limitation start from the date of the order refusing the permission, or the earlier date on which ended the term mentioned in the agreement? In other words, is time of the essence of the contract for sale, when it cannot take place till an authority beyond the control of the vendor has, to the knowledge of the purchaser, to approach for the permission to sell?

(2.) THE relevant facts of the case are the following. On 4-3-1941 the uncle, predecessor-in-interest of the defendant-appellant, executed a bond for Rs. 1500/in favour of the plaintiff-respondent agreeing to sell a piece of his landed property to him, within a period of 4 months, and on failure to repay the sum of Rs. 1500/with interest at 1 per cent, per month. On the same date an application was made on behalf of the vendor to the Subha of the district in which the property was situate for permission to sell. The Suba started proceedings on it; but they did not terminate within the 4 months period, and were actually disposed of on 8-12-1942 by an order refusing permission. The plaintiff filed the suit claiming repayment of Rs. 1500/- with interest, on 7-9-48 that is to say within 6 years (which was the limitation for suit of this nature under the Gwalior Limitation Act) from the date of the Suba's order, but longer than that period after 4-7-1941 which was the end of the four months period.

(3.) IT may be noted that the original borrower having died his heirs Were sued, they being the very persons who contested the permission proceeding before the suba on the ground of their being the pre-emptors. They admitted the liability of their uncle's property in their hands for the debts incurred by him in his life time. But they alleged that there has been no consideration; which however, has been rejected by both the lower courts, and need not be examined again here.