A purchaser facing repudiation must seek specific performance; a bare injunction is barred under Section 41(h).

The plaintiff entered into two agreements of sale dated 10 August 2008 with the defendants in respect of the suit properties, agreeing to pay ₹88,32,000 for each property. The plaintiff paid an aggregate advance of ₹22,00,000; the balance was payable upon execution of sale deeds. The agreements made obtaining a khatha certificate and a Defence Department NOC conditions precedent to conveyance. Although the khatha was obtained in 2016, the NOC was not secured.

The plaintiff alleged that it learned in October 2018 that defendants 1 and 2 had executed a registered agreement of sale in favour of defendant 3 in 2016. It then brought suits seeking permanent injunctions against further dealings with the properties, without seeking specific performance, and applied for leave under Order II Rule 2 CPC to bring a later specific-performance suit.

The Trial Court rejected both plaints under Order VII Rule 11(a) and (d) CPC. The plaintiff appealed.

1. Whether the cause of action for specific performance accrued upon expiry of the 60-day period for obtaining the NOC or, at the latest, when the plaintiff learned of the defendants’ transaction with a third party, making the bare injunction suits barred under Section 41(h) of the Specific Relief Act, 1963.

2. Whether the plaintiff’s applications for leave under Order II Rule 2(3) CPC could prevent rejection of the plaints under Order VII Rule 11(d) CPC.

Section 41(h) of the Specific Relief Act, 1963 bars an injunction where an equally efficacious remedy is available through the usual course of proceedings; the court treated specific performance, with interim injunctive relief if needed, as the efficacious remedy for the alleged breach of an agreement to sell.

Under Section 54 of the Transfer of Property Act, 1882, an agreement to sell does not itself create an interest in immovable property; the judgment also referred to Section 17(1A) of the Registration Act, 1908 and Section 53A of the Transfer of Property Act in addressing the position of an out-of-possession holder of an unregistered agreement.

Article 54 of the Limitation Act, 1963 was applied to the accrual of the right to sue for specific performance.

Order VII Rule 11 CPC permits rejection of a plaint where it discloses no cause of action or is barred by law; an Order II Rule 2 application cannot validate a suit otherwise barred by substantive law.

The court relied on State of Punjab v. Gurdev Singh, (1991) 4 SCC 1, regarding when the right to sue accrues; RBANMS Educational Institution v. B. Gunashekar & Another, 2025 INSC 490, regarding scrutiny of plaints for suits barred by law; and Sucha Singh Sodhi v. Baldev Raj Walia & Another, (2018) 6 SCC 733, regarding omission of reliefs under Order II Rule 2 CPC.

The court held that the plaintiff’s discovery in October 2018 of the registered agreement in favour of defendant 3 amounted to a clear threat and repudiation of the 2008 agreements, giving rise to an immediate cause of action for specific performance; the plaintiff could not defer that relief by relying on the outstanding NOC condition.

Because the plaintiff sought only permanent injunction and was not in possession, the court considered specific performance the appropriate efficacious remedy, with interim protection available in that suit.

The applications under Order II Rule 2 CPC did not cure the defect: leave to omit a relief could not overcome the substantive bar under Section 41(h).

Both appeals were dismissed, and the Trial Court’s orders rejecting the plaints under Order VII Rule 11(a) and (d) CPC were upheld.