Gujarat High Court
Ratilal Dhanjibhai Parmar vs Hitendrakumar Vinodbhai Patel on 2 July, 2024
NEUTRAL CITATION
C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 1791 of 2013
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE J. C. DOSHI
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1 Whether Reporters of Local Papers may be allowed
to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy
of the judgment ?
4 Whether this case involves a substantial question
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
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RATILAL DHANJIBHAI PARMAR & ORS.
Versus
HITENDRAKUMAR VINODBHAI PATEL & ORS.
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Appearance:
MR PREMAL S RACHH(3297) for the Petitioner(s) No. 1,2.1,2.2,3
MR AMIT V THAKKAR(3073) for the Respondent(s) No. 5
MR. SAHIL M SHAH(6318) for the Respondent(s) No. 3.1
NOTICE SERVED for the Respondent(s) No. 1,2.1,2.2,2.3,3.2,3.3,4
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CORAM:HONOURABLE MR. JUSTICE J. C. DOSHI
Date : 02/07/2024
ORAL JUDGMENT
1. By way of this petition under Article 227 of the Constitution of India, the petitioners pray to quash and set aside Page 1 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024 NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined order dated 17.12.2012 passed below application Exh.45 for amendment in Special Civil Suit No.414 of 1992, whereby the learned trial Court, Surat rejected application Exh.45.
2. Heard learned advocate Mr. Premal Rachh for the petitioners and learned advocate Mr. Amit Thakkar for respondent No.5. Learned advocate Mr. Sahil Shah for respondent No.3.1 is absent when the matter is called out.
3. The petitioners - original plaintiffs have filed the aforestated Special Civil Suit seeking relief of declaration and permanent injunction so also specific performance of the agreement to sell. The ex parte injunction was granted below Exh.5 in the suit and it was confirmed by parte. It is pleaded that in violation of the injunction order, the defendants of the suit have sold the property to third party. Later on, the suit was dismissed for non-prosecution. Then an application for restoration as well as delay application have been moved and both were allowed. However, as per the plaintiffs, during the hearing of the restoration application, the defendants of the suit have sold the property to third party and therefore, an application was moved at Exh.45 to amend the plaint with the following relief:-
"1. Be pleased to permit the necessary amendment by granting the amendment mentioned in para 4 of the said amendment application.
2. The cost of this application may be awarded from the defendants.
3. Looking to the over all facts of this application, the Hon'ble Court may grant any other relief which may be deemed fit and proper."Page 2 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024
NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined 3.1 The application at Exh.45 is rejected, hence, this petition under Article 227 of the Constitution of India.
4. Learned advocate for the petitioners after referring to the judgment of the Hon'ble Apex Court in case of Thomson Press (India) Ltd. Vs. Nanak Builders and Investors Private Limited and others reported in (2013) 5 SCC 397 would submit that the transferee/purchaser pendente lite in suit for specific performance is required to be impleaded, but the learned trial Court has not allowed the plaintiffs to amend the plaint accordingly. He would further submit that proposed partyies are purchaser pendente lite, is undisputed aspect. He would further submit to avoid multiplicity of proceedings and complete adjudication of the issue, proposed parties are necessary parties, hence, they are to be joined and amendment impleading to that effect is also required to be allowed. He would further submit that learned trial Court committed serious error by not allowing the application. Two other judgments are also referred to and relied upon by learned advocate Mr. Rachh; first in case of Kamlesh Gupta Vs. Mangat Rai reported in 2020(17) SCC 132 (para 9 to 13) and second in case of Robin Ramjibhai Patel Vs. Anandibai Rama @ Rajaram Pawar reported in 2018(15) SCC 614 (para 7 to 11).
4.1 Upon above submission, learned advocate Mr. Rachh prays to allow this petition.
5. On the other hand, learned advocate Mr. Amit Thakkar for respondent No.5 - proposed party would submit that joining the Page 3 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024 NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined party would change the suit from the suit for specific performance to the suit for title. He would further submit that the learned trial Court has given elaborate findings for not amending the plaint. He would further submit that the transaction which took place in favour of the defendants herein did not take place during the pendency of the suit, but when the suit was dismissed for default, the defendants of the suit have sold the disputed property to the proposed party - respondents and therefore, it cannot be said that the transfer has been made pendente lite in the suit. He would further submit that in a limited scope of supervisory jurisdiction Article 227 of the Constitution of India, this Court cannot interfere with the impugned order. He would further submit that under the guise of amending the suit, the plaintiffs intend to join the party under Order 1 Rule 10 of the CPC without preferring separate application. He would further submit that both the provision viz. Under Order 1 Rule 10 of the CPC and under Order 6 Rule 17 of the CPC have different cause of action and therefore, the learned trial Court has rightly rejected application Exh.45.
5.1 In support of his submission, learned advocate Mr. Amit Thakkar has referred to and relied upon judgment of the Hon'ble Apex Court in case of Bharat Karsondas Thakkar Vs. Kiran Construction Company and others reported in (2018) 13 SCC 658 and judgment of this Court in case of Amad Noormamad Madakia and others Vs. Ghanchi Ismail Hasan Madkia and others reported in 2024(1) GLR 396.
5.2 Upon above submission, learned advocate Mr.Thakkar prays to dismiss this petition.
Page 4 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined
6. Having heard learned advocates appearing for the respective parties, at the outset, I may refer the judgment of the Hon'ble Apex Court in case of Robin Ramjibhai Patel (supra). Para 7 to 11 are relevant, which reads as under:-
"7. Coming to the judgment in Kasturi's case (supra), it is notable that the suit for specific performance of contract for sale was filed by the appellant against respondent nos. 2 & 3. In the said suit respondent Nos. 1 & 4 to 11, who were not parties to the contract and had set up a claim of independent title and possession over the contracted property, filed an application to get themselves added in the suit as defendants. The trial court allowed the application on the ground that such respondents had direct interest in the subject matter of the suit and hence their presence would be necessary to decide the controversies raised in the suit. The High Court confirmed the said order and then the plaintiff came to this Court as appellant and their prayer was allowed by this Court. This Court took a clear view in paragraph 21 in the following terms:
"It may be reiterated here that if the appellant who has filed the instant suit for specific performance of contract for sale even after receiving the notice of claim of title and possession by Respondents 1 and 4 to 11 does not want to join Respondents 1 and 4 to 11 in the pending suit, it is always done at the risk of the appellant because he cannot be forced to join Respondents 1 and 4 to 11 as party- defendants in such suit. In the case of Ramesh Hirachand Kundanmal v. Municipal Corpn. of Greater Bombay on the question of jurisdiction this Court has clearly laid down that it is always open to the court to interfere with an order allowing an application for addition of parties when it is found that the courts below had gone wrong in concluding that the persons sought to be added in the suit were necessary or proper parties to be added as defendants in the suit instituted by Page 5 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024 NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined the plaintiff-appellant. In that case also this Court interfered with the orders of the courts below and rejected the application for addition of parties. Such being the position, it can no longer be said that this Court cannot set aside the impugned orders of the courts below on the ground that jurisdiction to invoke power under Order I Rule 10 CPC has already been exercised by the two courts below in favour of Respondents 1 and 4 to 11."
8. As it appears from the aforesaid paragraph this Court accepted the status of dominus litus of the plaintiff and proceeded to hold that if the plaintiff did not want to join the rival claimants as defendant in the pending suit, the risk was totally of the plaintiff and he cannot be forced to join them as party defendant.
9. In the aforesaid context, this Court also considered the provisions of Order I Rule 10 CPC and in paragraph 7 it expressed its view that the relevant provisions show that the necessary parties in a suit for specific performance of a contract for sale are not only parties to the contract or their legal representatives but also a person who had purchased the contracted property from the vendor. It was further elaborated that "in equity as well as in law, the contract constitutes rights and also regulates the liabilities of the parties. A purchaser is a necessary party as he would be affected if he had purchased with or without notice of the contract, but a person who claims adversely to the claim of a vendor is, however, not a necessary party. From the above, it is now clear that two tests are to be satisfied for determining the question who is a necessary party."
10. In our considered opinion, the judgment of the three Judge Bench in the Kasturi's case (supra) recognises this special status of a plaintiff which is well settled by several earlier judgments also and when the plaintiff wants to implead certain persons as defendants on the ground that they may be adversely affected by the outcome of the suit, then interest of justice also requires allowing such a prayer for impleadment so that the persons likely to be affected are aware of the proceedings and may take appropriate Page 6 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024 NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined defence as suited to their vendors.
11. In view of the aforesaid discussion, we have no hesitation in setting aside the orders of trial court as well as the High Court refusing the impleadment. As prayed by the appellant the applications for impleadment and for amendment are allowed. Resultantly the appeal is also allowed. In the facts and circumstances of the case, there shall be no order as to costs.
7. This issue is also come up before the Hon'ble Apex Court in the earlier judgment in case of Thomson Press (India) Ltd. (supra), where the Hon'ble Apex Court has opportunity to go through series of the authorities. Para 25 to 33 are relevant, which reads as under:-
"25. In the case of Vidhur Impex (AIR 2012 SC 2925) (supra), the Supreme Court again had the opportunity to consider all the earlier judgments. The fact of the case was that a suit for specific performance of agreement was filed. The appellants and Bhagwati Developers though totally strangers to the agreement, came into picture only when all the respondents entered into a clandestine transaction with the appellants for sale of the property and executed an agreement of sale which was followed by sale deed.
Taking note all the earlier decisions, the Court laid down the broad principles governing the disposal of application for impleadment. Paragraph 36 is worth to be quoted herein below:-
"Though there is apparent conflict in the observations made in some of the aforementioned judgments, the broad principles which should govern disposal of an application for impleadment are:---
1. The Court can, at any stage of the proceedings, either on an application made by the parties or otherwise, direct impleadment of any person as party, who ought to have been joined as Plaintiff Page 7 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024 NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined or Defendant or whose presence before the Court is necessary for effective and complete adjudication of the issues involved in the Suit.
2. A necessary party is the person who ought to be joined as party to the Suit and in whose absence an effective decree cannot be passed by the Court.
3. A proper party is a person whose presence would enable the Court to completely, effectively and properly adjudicate upon all matters and issues, though he may not be a person in favour of or against whom a decree is to be made.
4. If a person is not found to be a proper or necessary party, the Court does not have the jurisdiction to order his impleadment against the wishes of the Plaintiff.
5. In a Suit for specific performance, the Court can order impleadment of a purchaser whose conduct is above board/and who files Application for being joined as party within reasonable time of his acquiring knowledge about the pending litigation.
However, if the applicant is guilty of contumacious conduct or is beneficiary of a clandestine transaction or a transaction made by the owner of the suit property in violation of the restraint order passed by the Court or the Application is unduly delayed then the Court will be fully justified in declining the prayer for impleadment."
26. It would also be worth to discuss some of the relevant laws in order to appreciate the case on hand. Section 52 of the Transfer of Property Act speaks about the doctrine of lis pendens. Section 52 reads as under:
"52. Transfer of property pending suit relating thereto. - During the [pendency] in any Court having authority [within the limits of India excluding the State of Jammu and Kashmir] or established beyond such limits] by [the Central Government] [***] of [any] suit or proceedings Page 8 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024 NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined which is not collusive and in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein, except under the authority of the Court and on such terms as it may impose. [Explanation - For the purposes of this section, the pendency of a suit or proceeding shall be deemed to commence from the date of the presentation of the plaint or the institution of the proceeding in a Court of competent jurisdiction, and to continue until the suit or proceeding has been disposed of by a final decree or order and complete satisfaction or discharge of such decree or order has been obtained, or has become unobtainable by reason of the expiration of any period of limitation prescribed for the execution thereof by any law for the time being in force."
It is well settled that the doctrine of lis pendens is a doctrine based on the ground that it is necessary for the administration of justice that the decision of a court in a suit should be binding not only on the litigating parties but on those who derive title pendente lite. The provision of this Section does not indeed annul the conveyance or the transfer otherwise, but to render it subservient to the rights of the parties to a litigation. Discussing the principles of lis pendens, the Privy Council in the case of Gouri Dutt Maharaj v. Sukur Mohammed & Ors. AIR 1948 PC 147, observed as under:
"The broad purpose of Section 52 is to maintain the status quo unaffected by the act of any party to the litigation pending its determination. The applicability of the section cannot depend on matters of proof or the strength or weakness of the case on one side or the other in bona fide proceedings. To apply any such test is to misconceive the object of the enactment and in the view of the Board, the learned Subordinate Judge was in error in this respect in laying stress, Page 9 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024 NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined as he did, on the fact that the agreement of 8.6.1932, had not been registered."
27. Discussing the principles of lis pendens, the Privy Council in the case of Gouri Dutt Maharaj v. Sukur Mohammed & Ors. AIR 1948 PC 147, observed as under:
"The broad purpose of Section 52 is to maintain the status quo unaffected by the act of any party to the litigation pending its determination. The applicability of the section cannot depend on matters of proof or the strength or weakness of the case on one side or the other in bona fide proceedings. To apply any such test is to misconceive the object of the enactment and in the view of the Board, the learned Subordinate Judge was in error in this respect in laying stress, as he did, on the fact that the agreement of 8.6.1932, had not been registered."
28. In the case of Kedar Nath Lal & Anr. v. Ganesh Ram & Ors. AIR 1970 SC 1717, this Court referred the earlier decision (1967 (2) SCR 18) : (AIR 1967 SC 1440) and observed:
"The purchaser pendente lite under this doctrine is bound by the result of the litigation on the principle that since the result must bind the party to it so it must bind the person driving his right, title and interest from or through him. This principle is well illustrated in Radhamadhub Holder v. Monohar (1887) 151.A. 97 where the facts were almost similar to those in the instant case. It is true that Section 52 strictly speaking does not apply to involuntary alienations such as court sales but it is well-established that the principle of lis pendens applies to such alienations. (See Nilkant v. Suresh Chandra (1885) 12 IA171 and Moti Lal v. Karrab-ul-Din (1897) 24 I.A.170."
29. The aforesaid Section 52 of the Transfer of Property Act again came up for consideration before this Court in the case of Rajender Singh & Ors. v. Santa Singh & Ors. AIR 1973 SC 2537 and Their Lordship with Page 10 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024 NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined approval of the principles laid down in 1973 (1) SCR 139 : (AIR 1973 SC 569) reiterated:
"The doctrine of lis pendens was intended to strike at attempts by parties to a litigation to circumvent the jurisdiction of a court, in which a dispute on rights or interests in immovable property is pending, by private dealings which may remove the subject-matter of litigation from the ambit of the court's power to decide a pending dispute of frustrate its decree. Alienees acquiring any immovable property during a litigation over it are held to be bound, by an application of the doctrine, by the decree passed in the suit even though they may not have been impleaded in it. The whole object of the doctrine of lis pendens is to subject parties to the litigation as well as others, who seek to acquire rights in immovable property which are the subject-matter of a litigation, to the power and jurisdiction of the Court so as to prevent the object of a pending action from being defeated."
30. In the light of the settled principles of law on the doctrine of lis pendens, we have to examine the provisions of Order 1, Rule 10 of the Code of Civil Procedure. Order 1, Rule 10 which empowers the Court to add any person as party at any stage of the proceedings if the person whose presence before the court is necessary or proper for effective adjudication of the issue involved in the suit.
31. Order 1, Rule 10 reads as under :
"10. Suit in name of wrong plaintiff.-
(1) Where a suit has been instituted in the name of the wrong person as plaintiff or where it is doubtful whether it has been instituted in the name of the right plaintiff, the Court may at any stage of the suit, if satisfied that the suit has been instituted through a bona fide mistake, and that it is necessary for the determination of the real matter in dispute so to do, order any other person to be substituted or added as plaintiff upon such terms a the Court thinks just.Page 11 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024
NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined (2) Court may strike out or add parties.-The Court may at any stage of the proceedings, either upon or without the application of either party, and on such terms as may appear to the Court to be just, order that the name of any party improperly joined, whether as plaintiff or defendant, be struck out, and that the name of any person who ought to have been joined, whether as plaintiff or defendant, or whose presence before the Court may be necessary in order to enable the Court effectually and completely to adjudicate upon and settle all the questions involved in the suit, be added.
(3) No person shall be added as a plaintiff suing without a next friend or as the next friend of a plaintiff under any disability without his consent. (4) Where defendant added, plaint to be amended.-Where a defendant is added, the plaint shall, unless the Court otherwise directs, be amended in such manner as may be necessary, and amended copies of the summons and of the plaint shall be served on the new defendant and, if the Court thinks fit, on the original defendant. (5) Subject to the provisions of the Indian Limitation Act, 1877 (15 of 1877),section 22, the proceedings as against any person added as defendant shall be deemed to have begun only on the service of the summons."
From the bare reading of the aforesaid provision, it is manifest that sub-rule (2) of Rule 10 gives a wider discretion to the Court to meet every case or defect of a party and to proceed with a person who is a either necessary party or a proper party whose presence in the Court is essential for effective determination of the issues involved in the suit.
32. Considering the aforesaid provisions, this Court in the case of Ramesh Hirachand Kundanmal v. Municipal Corporation of Greater Bombay & Ors. 1992 (2) SCC 524 : (1992 AIR SCW 846) held as under:
Page 12 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined "It cannot be said that the main object of the rule is to prevent multiplicity of actions though it may incidentally have that effect. But that appears to be a desirable consequence of the rule rather than its main objectives. The person to be joined must be one whose presence is necessary as a party. What makes a person a necessary party is not merely that he has relevant evidence to give on some of the questions involved; that would only make him a necessary witness. It is not merely that he has an interest in the correct solution of some questions involved and has thought of relevant arguments to advance. The only reason which make it necessary to make a person a party to an action is that he should be bound by the result of the action and the question to be settled, therefore, must be a question in the action which cannot be effectually and completely settled unless he is a party. The line has been drawn on a wider construction of the rule between the direct interest or the legal interest and commercial interest. It is, therefore, necessary that the person must be directly or legally interested in the action in the answer, i.e., he can say that the litigation may lead to a result which will affect him legally that is by curtailing his legal rights. It is difficult to say that the rule contemplates joining as a defendant whose only object is to prosecute his own cause of action. Similar provision was considered in Anion v. Raphael Tuck & Sons Ltd. (1956) 1 All E.R. 273, wherein after quoting the observations of Wynn-Parry, J. in Dollfus Mieg et Compagnie S.A. v. Bank of England (1950) 2 All ER 605 (611), that the true test lies not so much in an analysis of what are the constituents of the applicants' rights, but rather in what would be the result on the subject-matter of the action if those rights could be established, Devlin J. has stated:
The test is 'May the order for which the plaintiff is asking directly affect the intervener in the enjoyment of his legal rights."
33. At this juncture, we would also like to refer Section Page 13 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024 NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined 19 of the Specific Relief Act which reads as under:
"19. Relief against parties and persons claiming under them by subsequent title.- Except as otherwise provided by this Chapter, specific performance of a contract may be enforced against-
(a) either party thereto;
(b) any other person claiming under him by a title arising subsequently to the contract, except a transferee for value who has paid his money in good faith and without notice of the original contract;
(c) any person claiming under a title which, though prior to the contract and known to the plaintiff, might have been displaced by the defendant;
(d) when a company has entered into a contract and subsequently becomes amalgamated with another company, the new company which arises out of the amalgamation;
(e) when the promoters of a company have, before its incorporation, entered into a contract for the purpose of the company and such contract is warranted by the terms of the incorporation, the company;
Provided that the company has accepted the. contract and communicated such acceptance to the other party to the contract."
From the bare reading of the aforesaid provision, it is manifest that a contract for specific performance may be enforced against the parties to the contract and the persons mentioned in the said section. Clause (b) of Section 19 makes it very clear that a suit for specific performance cannot be enforced against a person who is a transferee from the vendor for valuable consideration and without notice of the original contract which is sought to be enforced in the suit."
8. Since the purchase of disputed land is made during the Page 14 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024 NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined pendency of the suit, although the suit was dismissed during the interregnum period, but restored to its file, would give the result that the purchase is pending the suit and therefore, the purchase is pendente lite. Relief in the suit is asked for specific performance of the disputed property, which has changed the hand and now, it is with proposed defendants. To avoid multiplicity of proceedings and effective adjudication of the suit presence of proposed party in the suit is necessary. The plaintiffs, however, has committed serious error by not moving two separate applications under Order 1 Rule 10 of the CPC and under Order 6 Rule 17 of the CPC.
9. This Court in Amad Noormamad Madakia (supra) held that an application under Order 1 Rule 10 of the CPC and an application under Order 6 Rule 17 of the CPC have different cause of action and are to be filed differently.
10. In view of above, the learned trial Court's order does not justify the legal position and it requires to be quashed and set aside.
11. In the result, present petition is allowed and the impugned order dated 17.12.2012 passed below application Exh.45 for amendment in Special Civil Suit No.414 of 1992 is hereby quashed and set aside. The plaintiffs are permitted to file two separate applications one under Order 1 Rule 10 of the CPC and second under Order 6 Rule 17 of the CPC, which shall be decided on its own merit and in accordance with law.
12. Needless to say that the suits belongs to the year 1992 and Page 15 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024 NEUTRAL CITATION C/SCA/1791/2013 JUDGMENT DATED: 02/07/2024 undefined therefore, the learned trial Court shall give top priority to decide and dispose of the suit in a time bound manner.
Direct service is permitted.
(J. C. DOSHI,J) SHEKHAR P. BARVE Page 16 of 16 Downloaded on : Wed Jul 03 20:58:07 IST 2024