Dismissed¶11

M/S Akshay Enterprises v. Salarpuria Hi Rise Pvt. Ltd.

Karnataka HC13 Jun 2025CRP/24/2025

Case brief

AI extract

What is this about?

Karnataka HC CRP dismissed: Order VII Rule 11(b)/(d) plaint-rejection plea fails; specific-performance suit on 14.02.2011 MoU (3-month completion term) filed Dec 2019 after defendant's 03.10.2019 refusal — not time-barred on that footing; limitation and mutual extension-of-time are evidence-dependent mixed questions; extension of contract period need not be written, conduct suffices (trial court endorsed); distinguishes CMP No.75/2020 'deadwood' matter; Article 54 Limitation Act invoked by counsel; parties: Akshay Enterprises v. Salarpuria Hi Rise & Cornerstone/L&T entities.

What did the court decide?

None to the petitioners — the Civil Revision Petition was dismissed (the Trial Court's rejection of the Order VII Rule 11 application thereby stands affirmed in effect), and pending IAs, if any, were disposed of. ¶11

M/S Akshay Enterprises Vs Salarpuria Hi Rise Pvt. Ltd. — Arbitration | Karnataka HC (2025)

What the court decided

AI extract

Outcome

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Issue for consideration

Whether the suit (OS No.1925/2019, founded on the MoU dated 14.02.2011 which fixed three months for completion) is barred by limitation, so that the plaint is liable to be rejected under Order VII Rule 11(b) and (d) CPC — the 1st defendant contending the cause of action arose on expiry of three months (October 2011) while the suit was filed only in 2019. +1 more

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Court's answer

The suit cannot be ousted as time-barred on the ground that three months from the MoU expired in 2011: the plaintiff issued a legal notice on 18.09.2019, the 1st defendant replied on 03.10.2019 denying its obligation of specific performance arising out of the MoU, and the suit was filed in December 2019 — i.e., within the prescribed period, immediately after refusal of performance.

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Ratio / Principle

Whether limitation defeats the suit, and whether the parties mutually agreed to extend the period for completion of the contract (the plaint alleging the 1st defendant sought extension by its own conduct, including e-mail communications), are questions that can be concluded only after evidence is permitted to be placed on record and weighed; they cannot be resolved on the pleadings alone at the Order VII Rule 11 stage.

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Key takeaways

Endorsing the Trial Court's view, this Court holds that the extension of the period for completion of the contract can be decided having regard to the conduct of the parties, and it is not always necessary that such extension should be in writing.ratio¶9

Detailed headnote1 paragraphs

High Court of Karnataka (Devdas, J.) dismissed a Civil Revision Petition under S.115 CPC against the Trial Court's order dated 20.12.2024 rejecting defendant No.1's application (IA No.2) under Order VII Rule 11(b) and (d) CPC to reject the plaint in O.S.No.1925/2019 — a specific-performance suit on an MoU dated 14.02.2011 which fixed three months for completing land procurement and conversion. Held: (i) since the plaintiff's legal notice of 18.09.2019 drew the defendant's reply of 03.10.2019 refusing specific performance, and the suit was filed in December 2019, it cannot be ousted as time-barred on that count; (ii) whether limitation defeats the suit, and whether the parties mutually extended the completion period, are mixed questions decidable only by weighing evidence; and (iii) extension of the contractual period need not always be in writing — the parties' conduct suffices. The Court distinguished its earlier decision in CMP No.75/2020 (branded 'deadwood'), where the same parties' differently-timed dispute had led to dismissal. Petition dismissed; pending IAs disposed of.

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 13^TH DAY OF JUNE, 2025

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BEFORE

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THE HON’BLE MR.JUSTICE R. DEVDAS

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C.R.P NO. 24 OF 2025

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BETWEEN:

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1 . M/S AKSHAY ENTERPRISES A PARTNERSHIP FIRM HAVING ITS OFFICE AT NO.583, 1 CROSS, 9TH MAIN, OFF CMH ROAD, INDIRANAGAR 1 STAGE, BENGALURU-560038.

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REP. BY ITS PARTNERS, MR. B.P. KUMAR BABU AND MRS. KUMUDHA KUMAR BABU

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2 . MR. B.P. KUMAR BABU PARTNER, M/S. AKSHAY ENTERPRISES

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HAVING OFFICE ADDRESS AT NO. 583, 1 CROSS, 9TH MAIN, OFF CMH ROAD, INDIRANAGAR 1 STAGE, BENGALURU-560038 REP BY GPA HOLDER (MR. KIRAN POONACHA)

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3 . MRS. KUMUDHA KUMAR BABU PARTNER, M/S. AKSHAY ENTERPRISES HAVING OFFICE ADDRESS AT NO. 583, 1 CROSS, 9TH MAIN, OFF CMH ROAD,

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INDIRANAGAR 1 STAGE, BENGALURU-560038

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ALSO RESIDING AT

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R/O. VISHNU PAADAM, NO. 132, 4TH MAIN, DEFENCE COLONY, INDIRANAGAR, 1 STAGE, BENGALURU -560 038 REP BY GPA HOLDER (MR. KIRAN POONACHA)

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…PETITIONERS

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(BY SRI. DHYAN CHINNAPPA, SR. COUNSEL FOR SRI. SUNDARA RAMAN M.V., ADVOCATE)

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AND:

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1 . SALARPURIA HI RISE PVT LTD 4TH FLOOR, SALARPURIA, WINDSOR, NO.3, ULSOOR ROAD, BENGALURU-560042. REP. BY AUTHORISED REPRESENTATIVE MR. ASHWIN SANCHETI

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2 . CORNERSTONE PROPERTY INVESTMENTS PVT. LTD. HAVING ITS OFFICE AT 583, 1 CROSS, 9TH MAIN, OFF CMH ROAD, 1 STAGE, INDIRANAGAR, BENGALURU- 560038. REPRESENTED BY DIRECTORS.

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3 . CORNERSTONE BAY CITY DEVELOPMENTS PVT. LTD. HAVING ITS OFFICE AT NO.583, 1ST CROSS, 9TH MAIN, OFF CMH ROAD, 1ST STAGE, INDIRANAGAR, BENGALURU 560038. REPRESENTED BY DIRECTORS

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4 . CORNERSTONE PROPERTIES PVT LTD NO. 583, 1ST CROSS, 9TH MAIN, OFF CMH ROAD, 1ST STAGE, INDIRANAGAR, BENGALURU 560038. REPRESENTED BY DIRECTORS.

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5 . CORNERSTONE BAY EAST DEVELOPERS PVT. LTD. HAVING ITS OFFICE AT 583, 1 CROSS, 9TH MAIN, OFF CMH ROAD, INDIRANAGAR, 1 STAGE, BENGALURU 560038. REPRESENTED BY ITS DIRECTORS. 6 . ANAMITRA ESTATES & DEVELOPERS PVT. LTD. HAVING ITS REGISTERED OFFICE AT NO.583, 1ST CROSS, 9TH MAIN, OFF CMH ROAD, 1ST STAGE, INDIRANAGAR, BENGALURU- 560038. REPRESENTED BY DIRECTORS. 7 . MAVERICK PROPERTY INVESTMENTS PVT. LTD. HAVING ITS OFFICE AT NO.583, 1 CROSS, 9TH MAIN, OFF CMH ROAD, 1 STAGE, INDIRANAGAR, BENGALURU- 560038. REPRESENTED BY DIRECTORS.

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8 . L & T HOUSING FINANCE LTD. HAVING ITS REGISTERED OFFICE AT BRINDAVAN, PLOT NO. 177, C.S.T. ROAD, KALINA, SANTACRUZ (EAST) MUMBAI-400 098, MAHARASHTRA REPRESENTED BY DIRECTORS.

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9 . L & T FINANCE LTD. HAVING ITS REGISTERED OFFICE AT TECHNOPOLIS, 7TH FLOOR, A- WING, PLOT NO.4, BLOCK BP, SECTOR-V,

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SALT LAKE, KOLKATA- 700091. REPRESENTED BY DIRECTORS.

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ALSO HAVING ITS BRANCH OFFICE AT

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UNIT 1, 3RD FLOOR, PRIDE HULKUL, NO. 116, LALBAGH ROAD, BENGALURU - 560027.

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10 . L & T INFRASTRUCTURE FINANCE COMPANY LTD. HAVING ITS REGISTERED OFFICE AT BRINDAVAN, PLOT NO. 177, C.S.T. ROAD, KALINA, SANTACRUZ (EAST) MUMBAI-400 098, MAHARASHTRA REPRESENTED BY DIRECTORS ALSO HAVING ITS BRANCH OFFICE AT UNIT 1, 3RD FLOOR, PRIDE HULKUL NO.116, LALBAGH ROAD, BENGALURU-560027.

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…RESPONDENTS

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( SRI. K.G.RAGHAVAN & SRI. G.L.VISHWANATH., SR. COUNSEL FOR SRI. BADRI VISHAL., ADVOCATE FOR R1 V/O/DT. 10.01.2025, NOTICE TO R2 TO R10 IS D/W)

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THIS C.R.P IS FILED U/S 115 OF CPC., AGAINST THE ORDER DATED 20.12.2024 PASSED ON IA NO.2 IN OS NO.1925/2019 ON THE FILE OF III ADDITIONAL SENIOR CIVIL JUDGE, BENGALURU RURAL DISTRICT, BENGALURU, REJECTING THE IA NO.2 FILED UNDER ORDER 7 RULE 11(b) AND (d) OF CPC., FOR REJECTION OF PLAINT.

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THIS C.R.P HAVING BEEN HEARD AND RESERVED ON 14.03.2025 AND COMING ON FOR PRONOUNCEMENT OF ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING:

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CORAM: HON'BLE MR JUSTICE R DEVDAS

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CAV ORDER

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(PER: HON'BLE MR JUSTICE R DEVDAS)

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This Civil Revision Petition is filed by defendant No.1 before the Trial Court, aggrieved of the impugned order dated 20.12.2024, whereby the interlocutory application filed by defendant No.1 under Order VII Rule 11 of CPC was rejected by the trial court.

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For the sake of convenience, the parties shall be referred to in terms of their ranking before the trial court.

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Learned Senior Counsel Sri Dhyan Chinnappa, appearing for defendant No.1 submitted that this Court had an occasion to consider a similar matter between the parties in CMP No.75/2020, where similar such MoU was entered into between the parties on 04.02.2011 (in the present case the MoU is dated 14.02.2011) in respect of different set of lands. As in the present case, there too a legal notice was got issued by the plaintiff on 13.11.2019

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calling upon the defendant to specifically perform and complete all obligations under the MoU, failing which the defendant was called upon to refund the amount deposited by the plaintiff under the MoU, along with interest. In the present case, legal notice was issued by the plaintiff on 18.09.2019 and the 1^st defendant issued a reply on 03.10.2019 denying any obligation of specific performance arising out of the MoU, while contending that said MoU does not create any legal obligation on the 1^st defendant. It was also clearly contended that the claims of the plaintiff are barred by limitation. However, in the other case, since an arbitration clause was contained in the said MoU, the plaintiff herein had to approach this Court by filing a Civil Miscellaneous Petition invoking Section 11(6) of the Arbitration and Conciliation Act, 1996, for appointment of an Arbitral Tribunal to adjudicate the disputes arising out of MoU dated 14.02.2011. This Court has held that the plaintiff-Company is guilty of waiting for an unreasonably long time to initiate action

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against the defendant. It was noticed that not a scrap of paper is available on record to show that the parties had mutually agreed to extend the time for completion of the contract. In view of the time fixed therein i.e., three months to procure the lands and get the scheduled lands converted from agricultural to nonagricultural purposes, this Court held that after lapse of three months, no efforts were made by the plaintiffCompany to seek repayment of the advance amount. Accordingly, having come to the conclusion that it is a clear case of ‘deadwood’, the CMP was dismissed.

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The learned Senior Counsel would further contend that in para 10 of the plaint, it is contended by the plaintiff that the 1^st defendant sought confirmation from the plaintiff that it would obtain ‘B’ katha at its cost and in order to obtain ‘A’ katha for each parcel of land and thereafter the kathas could be clubbed together and that the plaintiff would have to bear the costs. However, it is contended by the plaintiff that it declined to accept the

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request made by the 1^st defendant. Attention of this Court is also drawn to para 11 of the plaint where it is clearly stated that although the MoU stipulated the 1^st defendant to acquire ownership and get the lands converted within three months from the date of the MoU, there was no sign of the 1^st defendant complying with the said requirement. However, details of the items of the schedule properties where agreements of sale were obtained by the 1^st defendant with the owners are given in a tabular column in paragraph 11 while also stating that the 1^st defendant got a sale deed dated 17.11.2014 executed from the owners in respect of one item of property. It is averred in the plaint that there were several e-mail communications between the parties and the plaintiff and its lawyers made several requisitions to the 1^st defendant to comply with the terms of the MoU. It is contended that one Mr.Pradeep Joe, who was also a witness to the MoU, tried to persuade the 1^st defendant to comply with the terms of the MoU. It is contended in paragraph 18 that pursuant to the assurances of the 1^st defendant, after the intervention of

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Mr.Pradeep Joe, the plaintiff addressed an e-mail on 27.06.2016 to the defendants attaching the list of requisitions and for needful action. It is contended that one Mr.Kiran Poonacha, who is part of the Cornerstone Group (one of the defendants) had also made e-mail communication on 28.06.2016. It is alleged in the plaint that despite all these requisitions, the 1^st defendant made half-hearted attempt in fulfilling the obligation. It is therefore clear from the plaint averments that there is no pleading to the effect that the 1^st defendant gave anything in writing to extend the period for completion of the MoU. It is submitted that the Hon’ble Supreme Court has clearly held that mere exchange of letters or e-mails will not extend the period of limitation.

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It is further pointed out that the plaintiff got issued a legal notice dated 18.09.2019 calling upon the defendant to come forward to fulfill its obligation under the MoU. It is stated in paragraph-30 that inspite of the legal notice being issued, the defendant

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failed to adhere to the claims of the plaintiff. However, the cause of action arose for the plaintiff immediately after expiry of three months from the date of the MoU, i.e., October, 2011, but the suit is filed in the year 2019, which is clearly time barred.

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Per contra, learned Senior Counsel Sri K.G.Raghavan, appearing for the plaintiff contended that this case is not the same as the other cases referred to by the learned Senior Counsel for 1^st defendant, although the parties are similar. Learned Senior Counsel contended that the legal notice was got issued by the plaintiff on 18.09.2019 and the suit is filed in the year 2019 itself. The contention of the 1^st defendant that the cause of action arose for the plaintiff in October, 2011 cannot be accepted, having regard to the averments made in the plaint. Attention of this Court is also drawn to Article 54 of the Limitation Act, which prescribes that for specific performance of a contract, the period of three years shall commence when the plaintiff has noticed that performance

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is refused. It is contended that the first part of the said Article regarding performance when date is fixed, would not apply to the facts and circumstances of this case. It is also contended that the trial court has rightly accepted the contention of the plaintiff that the extension of time for completion of the contract need not always be in writing. The conduct of the parties, having regard to the evidence that could be placed on record is to be weighed while considering such question of limitation which are always a mixed question of law and facts.

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Heard the learned Senior Counsels for the

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1^st defendant and the plaintiff and perused the petition papers.

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As rightly contended by learned Senior Counsel Sri K.G.Raghavan, unlike the other cases between the parties which have already been decided by this Court, in this case it is noticeable that the legal notice was got issued by the plaintiff on 18.09.2019 and a reply was given by the 1^st defendant on

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03.10.2019, denying its obligation of specific performance arising out of the MoU. The suit is filed in the month December,2019. Therefore, on that count the suit cannot be ousted.

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On the other hand, it is sought to be contended on behalf of the 1^st defendant that the plaintiff has admitted in the plaint that three months were fixed for the 1^st defendant to secure the said property in its name; to get the conversion of schedule ‘B” property; to make out good and marketable title and to secure one combined katha from BBMP for the entire extent of 30 acres 21 guntas. It is therefore sought to be contended that time for completion of the contract, at the hands of the 1^st defendant was fixed at three months from the date of the MoU and therefore the cause of action arose for the plaintiffs immediately after expiry of three months. This contention cannot be accepted, having regard to catena of decisions where it is held that such issue regarding limitation are required to be decided, looking into the

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evidence that could be brought on record. The trial court has rightly held that the law in this regard is that the extension of period for completion of the contract can be decided having regard to the conduct of the parties and it is not always necessary that the extension of the period should be in writing.

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Unlike the other cases between the parties, in the present case the suit has been filed within the prescribed period, immediately after a reply is given by the 1^st defendant, denying the claim of the plaintiffs. On the other hand, various averments are made in the plaint contending that the 1^st defendant has procured many items of the property, in terms of the MoU. The plaintiff seeks to place before the court various e-mail communications to show that the 1^st defendant had sought for extension of time, by its own conduct. Therefore, unless the evidence is permitted to be placed on record, and the same is weighed, it would not be possible to conclude whether the parties mutually agreed to extend the period for completion of the contract.

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