Judgment:
ORDER
Ajit Prakash Shah, C.J.
1. This petition is filed under Section 11(5) of the Arbitration and Conciliation Act, 1996 for appointment of a sole arbitrator to adjudicate upon the disputes between the parties.
2. The facts are that an agreement to sell dated 6.7.1999 was entered into between the parties whereby the petitioner had agreed to purchase from the respondent the property bearing Shop No. 12, Ground Floor, Block No. 172, Jor Bagh, New Delhi, for a sum of Rs. 49,90,000/. Out of the total consideration of Rs. 49,90,000/-, the petitioner paid a sum of Rs. 5,00,000/- as earnest money at the time of execution of the agreement to sell. According to the petitioner, the balance amount of Rs. 44,90,000/- was to be paid upon fulfillment of certain conditions by the respondent mentioned in Clause 2(b) of the Agreement. It is the case of the petitioner that those conditions have not been fulfilled by the respondent till date.
3. The petitioner has annexed to the petition the letter of the respondent dated 13.12.2006 whereby the petitioner was informed that the agreement to sell had been terminated by the respondent vide their letter dated 22.8.2003. The petitioner in the petition has disputed the receipt of the letter dated 22.8.2003. However, the respondent has placed on record the Registered Post Acknowledgement Receipt and submitted that the petitioner had also replied to the letter dated 22.8.2003. The petitioner had invoked the arbitration vide letter dated 17.3.2008. The question is whether the claim is barred by limitation.
4. On behalf of the petitioner, reliance was placed upon the first part of Article 54 of the Limitation Act. It was contended by learned Counsel for the petitioner that the words 'date fixed for the performance' do not require that a particular date from the calendar must be mentioned in the document. If such date can be ascertained on the basis of contents of document, the first part of Article 54 will be attracted. He relied upon Clause 2(b) of the Agreement which provides that the sale deed shall be executed within 90 days of fulfillment of three conditions, namely, (i) getting the mutation of the property done in their favour in the records of the L&DO; (ii) obtaining the income tax clearance in Form 34(a) from the Income Tax Authorities under Section 230(a) of the Income Tax Act, 1961; and (iii) getting the eviction suits pending before the court of Additional Rent Controller and the Rent Tribunal decided. The argument is that though no definite date had been fixed in so many words in the agreement, it was capable of ascertainment by application of the maxim certum est quod certum reddi potest and that date would be on expiry of 90 days of happening of three events mentioned in Clause 2(b). In support of his submission, learned Counsel relied upon the decision of the Supreme Court in Ramzan v. Smt. Hussaini : AIR1990SC529 . In that case, the Supreme Court held that the words 'date fixed for the performance' in Article 54 do not require that a particular date from the calendar must be mentioned in the document. It is sufficient if the basis of calculating the date fixed for performance is found in the document. The doctrine of id certum est quod certum reddi potest which means that certainty need not be ascertained at the time; for if, in the fluxion of time, a day will arrive which will make it certain, that is sufficient is applicable. In that case, the contract of sale was in respect of a house. The house was under mortgage. The defendant-seller under the contract had agreed to execute a deed of sale on the day the purchaser redeemed the mortgage. The suit for specific performance of the contract was filed by the purchaser some 14 years after redemption of the mortgage. In view of these facts, the Court held that under the agreement, the date for the defendant-seller to execute the sale deed was fixed, although not by mentioning a certain date but by reference to the happening of a certain event, namely, the redemption of the mortgage; and, immediately after the redemption by the plaintiff purchaser, the defendant became liable to execute the sale which the plaintiff was entitled to enforce. The case was therefore held to be covered by first part of Article 54.
5. Learned Counsel also referred to a decision of Sat Pal, J. in Tosh Apartments Pvt. Ltd. v. Shri Pradeep Kumar Khanna and Ors. : 54(1994)DLT318 , wherein it was held that where form the agreement it is clear that the transaction was to be completed within 45 days from the date, the defendant obtained the requisite clearance and till date of filing of suit, the defendant had not informed the plaintiff that he had obtained the requisite sanctions, and on the contrary two months prior to the filing of the suit, he had informed the plaintiff that the said sanctions, no objections and clearances were not obtained by him. Even the defendant from his conduct had understood that the time was not the essence of the contract. The suit was therefore held to be not barred by limitation in view of Article 54. In that case, Sat Pal, J. was dealing with an application under Order 7 Rule 11(d) for dismissal of the plaint. The doctrine of id certum est quod certum reddi potest was not discussed by the learned Judge.
6. In the present case, there is no dispute that no definite date had been fixed in so many words in the agreement. The question is whether maxim certum est quod certum reddi potest would apply. Clause 2(b) of the Agreement speaks of not one event but of several events which, looking to the nature of conditions, could not possibly have happened simultaneously. Surely maxim certum est quod certum reddi potest cannot apply to such a case. In this regard, I may quote the observations of a Division Bench of the Lahore High Court in Waryam Singh v. Gopi Chand AIR 1930 Lahor 34, wherein Tek Chand, J speaking for the bench, observed:
Before deciding whether on this finding a decree for specific performance for the whole or a part of the contract should be passed in favour of the plaintiffs, it is necessary to determine whether the suit is within time. It is common ground between the parties that the caseis governed by Article113, Lim. Act, which provides a period of three years for suits of this nature from (a) the date fixed for the performance of the contract, or (b) if no such date is fixed when the plaintiff has notice that performance is refused. It was admitted on behalf of the defendants that no definite date had been fixed in so many words in agreement. But it was contended that it was capable of ascertainment by application of the maxim certum est quod certum reddi potest and that this date was 30th August 1920 when the proprietary rights were acquired by the defendants. It was accordingly urged that the suit which was brought more than three years after this date was time barred. In my judgment this maxim cannot be invoked in reference to a loosely worded document like the agreement in question in which the promisor undertook to execute the sale deed not on the happening of a particular event but after payment of the last instalment in the Government Treasury and after the acquisition of proprietary rights - events which, under the conditions of the grant, could not possibly have happened simultaneously. The case does not, therefore, fall within first part of Col.3, Article 113.
7. Under the circumstances, the case would not fall under first part of Article 54.
8. Learned Counsel appearing for the petitioner next argued that the notice dated 22.8.2003 merely states that in case the entire balance consideration is not paid within 15 days, the agreement shall come to an end and the earnest money shall stand forfeited. According to him, on a correct reading of the notice, it would not be a case of a repudiation of the contract but on the other hand, it shows that respondent has been acting pursuant to the contract and under the circumstances, the notice cannot be treated as a refusal to perform the contract. He relied upon the following observations of the House of Lords in Woodar Investment Development Ltd. v. Wimpey Construction [1980] (1) All ER 571:
In this case the contract provided for the possibility of rescission by Wimpey. But the notice of rescission, which Wimpey gave, was not, in the circumstances which existed when it was given, one which Wimpey had any contractual right to give. But they honestly believed the contract did give them the right. When one examines the totality of their conduct and its impact on Mr. Cornwell, it is plain, as shown by my noble and learned friend Lord Wilberforce's analysis of the facts, that Wimpey, though claiming mistakenly to exercise a power given them by the contract to bring it to an end, were not evincing an intention not to be bound by the contract. On the contrary, they believed they were acting pursuant to the contract. And Mr. Cornwell well understood the situation. As he put it in his final letter to Sir Godfrey Mitchell, the president of Wimpey:'.... all I need say now is that we will retire to our battle stations and it goes without saying I am sure that you will abide by the result as I will.' It never occurred to Mr. Cornwell that Wimpey, if held not to have been entitled to give notice of rescission, would refuse to perform the contract. In fact, it would seem that he believed exactly the contrary. Such was the impact on him of Wimpey's conduct.
It being the view of the majority of the House that there was no repudiation, the appeal must be allowed, with the result that there is no need to consider the other issues raised.
9. I am unable to accept the submission of the learned Counsel. The notice dated 22.8.2003 clearly states that in case the balance consideration is not paid within 15 days, the earnest money shall stand forfeited. On a plain reading of the notice, it is clear that the respondent wanted to bring an end to the contract on account of non-payment of balance consideration. By reply dated 16.9.2003, the petitioner had contended that the balance amount would be payable only in terms of Clause 2(b) of the agreement and called upon the respondent to withdraw the notice under reply. The notice was not withdrawn by the respondent. In these circumstances, it is difficult to accept the submission that there was no refusal of the performance. The contract was repudiated vide notice dated 22.8.2003. The arbitration clause was invoked on 17.3.2008, i.e. beyond the period of limitation and thus the claim is barred under Article 54 of the Limitation Act. The arbitration petition is dismissed with costs.