Bombay High Court
Sushil S/O Sohanlal Agrawal vs Harishankar Ramnivas Sharma And ... on 26 February, 2016
Author: A.S. Chandurkar
Bench: A.S. Chandurkar
CRA88.14.odt 1/16
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH : NAGPUR.
CIVIL REVISION APPLICATION NO.88 OF 2014
APPLICANT: Sushil S/o Sohanlal Agrawal, aged
about 52 years, Occ: Business, R/o
(Ori. Deft. No.1)
234, Middle Ring Road, East
Wardhaman Nagar, Nagpur - 440
008, Tahsil and District Nagpur.
-VERSUS-
NON-
APPLICANTS:
ig 1. Harishankar Ramnivas Sharma,
aged about 54 years, Occ:Business,
R/o M.I.D.C., Hingna Road,
(On R.A.)
Nagpur.
2. M/s Orange City Castings, through
its Partner - Suresh
Mahabirprasad Chobdar, aged
about 40 years, Occ: Business, R/o
C/o Balaji Rolling Mill, Near Murli
Agro, M.I.D.C., Hingna Road,
Nagpur.
Shri M. G. Bhangde, Senior Advocate with Shri D. N. Mehta,
Advocate for the applicant.
Shri S. P. Bhandarkar, Advocate for non-applicant No.1.
Shri A. P. Paliwal, Advocate for non-applicant No.2.
CORAM: A.S. CHANDURKAR, J.
DATE ON WHICH SUBMISSIONS WERE HEARD: 17-12-2015.
DATE ON WHICH JUDGMENT IS PRONOUNCED: 26-02-2016.
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ORAL JUDGMENT :
1. Admit. Heard finally in view of notice for final disposal issued on 23/09/2014.
2. By this civil revision application filed under Section 115 of the Code of Civil Procedure (for short 'the Code'), the applicant, who is the original defendant No.1 in S.C.S. No.5055/2012 has challenged the order dated 30/06/2014 passed on the application below Exhibit-33 filed under provisions of Order VII Rule 11(a) and (d) of the Code for rejection of the plaint.
Similarly, the order dated 15/09/2014 rejecting the review application below Exhibit-49 filed by the applicant is also under challenge.
3. Few facts which are relevant to consider the challenge as raised in the revision application are that, initially the non-
applicant No.1 had filed S.C.S. No.581/2006 against the present applicant and three others. It was the case of the non-applicant No.1 that he was the lawful owner of land bearing Kh. No.46 and part of land bearing Kh. No.47, admeasuring 1.75 acres. It was the further case that though the non-applicant No.1 was the owner of aforesaid land, by sale-deeds dated 24/12/1998 and 29/01/2001, he was sought to be divested of his title. The ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 3/16 aforesaid suit was, therefore, filed for declaration that the non-
applicant No.1 was the lawful owner of the suit lands on the basis of sale-deed dated 08/01/1999 and for a declaration that the sale-
deeds dated 24/12/1998 and 29/01/2001 were null and void. A prayer for permanent injunction was also made. The applicant who was the defendant No.1 had filed a counter-claim seeking declaration of his title. During pendency of the said civil suit, a compromise petition came to be filed on record on 07/10/2008.
In terms of said compromise petition, the suit was withdrawn and the counter-claim filed by the applicant came to be decreed. This order was passed on 10/08/2008.
4. Thereafter, the non-applicant No.1 on 01/12/2012 filed S.C.S. No.5055/2012 against the present applicant and another praying therein that the compromise decree that was passed in S.C.S. No.581/2006 be declared as null and void. A further declaration was sought that the sale-deed dated 08/01/1999 was valid and that the sale-deeds dated 24/12/1998 and 29/01/2001 were null and void ab initio. Other consequential reliefs were also prayed for. There was also a prayer for perpetual injunction with regard to protecting the possession of the non-
applicant No.1.
5. The applicant moved an application under provisions ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 4/16 of Order VII Rule 11(a) and (d) of the Code below Exhibit-33. It was stated in the application that S.C.S. No.581/2006 had been withdrawn by the non-applicant No.1 without seeking any further liberty/ permission to file fresh proceedings. It was stated that, such course was not permissible. The subsequent suit was also barred in view of provisions of Order XXIII Rule 3-A of the Code.
It was further stated that the subsequent suit was also barred by limitation. On these counts, it was prayed that the plaint be rejected. The non-applicant No.1 filed his reply below Exhibit 36- A and opposed the application. The trial Court by order dated 30/06/2014 rejected said application below Exhibit-33. It held that the subsequent suit had been filed within limitation and that withdrawal of the earlier suit would not preclude the non-
applicant No.1 from instituting the subsequent suit.
6. The applicant thereafter filed an application below Exhibit-49 seeking review of the order passed below Exhibit-33 on the ground that the trial Court had committed an error apparent on the face of record while rejecting said application. The review application was also rejected on 15/09/2014. Both these orders are challenged in this revision application.
7. Shri M.G. Bhangde, the learned Senior Counsel for the applicant submitted that the trial Court committed an error when ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 5/16 it rejected the application below Exhibit-33. It was submitted that S.C.S. No.581/2006 had been withdrawn by the non-applicant No.1 on the ground that the proceedings had been compromised.
No liberty was sought by the non-applicant No.1 before withdrawing the civil suit and therefore no suit could have been filed seeking similar reliefs. The subsequent suit seeking to challenge the compromise decree was also not maintainable in view of the bar under provisions of Order XXIII Rule 3-A of the Code. It was submitted that the compromise having been entered into by practicing fraud cannot be a ground for filing a subsequent suit for setting aside the compromise decree. The applicant in support of the application below Exhibit-33 had relied upon the averments made in S.C.S. No.581/2006 and without considering these aspects, the trial Court was not justified in holding that the subsequent suit was maintainable. In support of his submission that the subsequent suit was barred in law, the learned Senior Counsel relied upon the judgments of the Hon'ble Supreme Court in Banwari Lal vs. Chando Devi and another (1993) 1 SCC 581;
Horil vs. Keshav and another (2012) 5 SCC 525 and R. Rajanna vs. S.R. Venkataswamy and others (2014) 15 SCC 471. It was then submitted that the subsequent suit was barred by limitation in as much as the same was filed more than three years from the ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 6/16 disposal of the earlier proceedings. S.C.S. No.581/2006 was disposed of on 10/10/2008, while according to the non-applicant No.1, the cause of action for filing S.C.S. No.5055/2012 as stated in paragraph 43 of the plaint accrued on 23/10/2008. The subsequent suit was filed on 01/12/2012 which was beyond three years from the date when the cause of action had accrued.
Reference was made to the provisions of Article 59 of the Limitation Act, 1963. It was submitted that from the averments in the plaint, the aspect of limitation ought to have been considered by the trial Court. In that regard, the learned Senior Counsel placed reliance on the judgment of the Hon'ble Supreme Court in Suresh Kumar Dagla vs. Sarwan and another, 2014 (9) SCALE 675.
It was then submitted that though the applicant had sought a review of the order passed below Exhibit-33, the trial Court did not consider the application for review in the proper perspective.
It was, therefore, submitted that the order passed below Exhibit-33 was liable to be set aside and the suit deserved to be dismissed.
8. On the other hand, Shri S.P. Bhandarkar, the learned Counsel for the non-applicant No.1 supported the impugned orders. It was submitted that the trial Court was justified in rejecting the application below Exhibit-33. According to the learned Counsel, the reliefs sought in the subsequent suit basically ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 7/16 against the defendant No.2 therein and only the first prayer in the said suit was sought against the present applicant. Similarly, the prayers made in the earlier suit and those made in the subsequent suit were distinct. According to him, the entire suit was not liable to be dismissed under provisions of Order VII Rule 11 of the Code and that it was not permissible to reject the plaint in part. The cause of action for filing the subsequent suit had been clearly stated in the plaint and, hence, there was no case made out for dismissing the suit under provisions of Order VII Rule 11(a) of the Code. Similarly, there was no statement in the plaint on the basis of which the provisions of Order VII Rule 11(d) of the Code could be attracted. It was then submitted that the question of limitation was a mixed question of law and facts and said aspect could not have been decided under provisions of Order VII Rule 11(d) of the Code. In that regard, the learned Counsel placed reliance on the judgment of the Hon'ble Supreme Court in Balasaria Construction (P) Ltd. vs. Hanuman Seva Trust and others (2006) 5 SCC 658. The learned Counsel also relied upon the decision in Bhau Ram vs. Janak Singh and others (2012) 6 Mh.L.J. 758 (SC) in support of his submissions. It was then submitted that the review application had been rightly rejected by the trial Court. Therefore, in absence of any error of jurisdiction, there was no case made out to invoke ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 8/16 jurisdiction under Section 115 of the Code.
9. In the present case, the applicant has sought rejection of the plaint for relying upon the provisions of Order VII Rule 11(a) & (d) of the Code. Under clause (a) if the plaint does not disclose a cause of action it has to be rejected. Under clause (d) if the suit appears from the statement in the plaint to be barred by law, the plaint shall be rejected. The applicant has relied upon the provisions of Order XXIII Rule 3A of the Code while seeking rejection of the plaint. Similarly, according to the applicant the suit is barred by limitation.
10. It would be first necessary to examine whether the bar under provisions of Order XXIII Rule 3A would be attracted in the present case. Special Civil Suit No.581/2006 was filed by the non-
applicant No.1 in which he had sought the relief of declaration that the sale deed dated 24-12-1998 executed by the defendant No.2 in favour of the defendant No.3 as well as the sale deed dated 29-1-2001 executed by the defendant No.3 therein in favour of the defendant No.1 were null and void. A further declaration was sought that the non-applicant No.1 was the owner of the suit property admeasuring 1.75 acres as per the sale deed dated 8-1- 1999. In said suit, the present applicant had filed a counter claim challenging the sale deed dated 8-1-1999 that was executed in ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 9/16 favour of the non-applicant No.1. The applicant further sought the relief of permanent injunction.
Special Civil Suit No.581/2006 came to be disposed of on the basis of a compromise between the parties. The suit filed by the non-applicant No.1 came to be withdrawn while a decree was passed in the counter claim filed by the applicant on 10-10- 2008.
11. In so far as the SC.S. No.5055 of 2012 is concerned, the same has also been filed by the non-applicant No.1 against the present applicant and the defendant No.3 in S.C.S. No.581/2006.
In paragraph Nos.31 to 33 of this suit, it has been pleaded that the compromise petition in the earlier suit was got executed by the applicant fraudulently, under coercion and threat. The relief sought in this suit is a declaration that the compromise dated 24- 10-2008 be declared null and void. A prayer is also made that the sale deed dated 8-1-1999 in favour of the non-applicant No.1 be declared legal and valid and that the sale deeds dated 24-12-1998 and 29-1-2001 be declared null and void. Further consequential relief of setting aside the mutation entries standing on record on the basis of aforesaid transactions be declared to be illegal. There is also a prayer for perpetual injunction. The cause of action for this suit is stated to have accrued on 24-10-2008 when the ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 10/16 applicant obtained the compromise decree by practicing fraud on the non-applicant No.1. It was stated that the cause of action continued thereafter when the mutation entries were recorded.
12. From the aforesaid, it can be seen that S.C.S. No.5055/2012 is essentially a suit for setting aside the compromise decree that was passed in Special Civil Suit No.581/2006. Besides said prayer, the other prayers in relation to the sale deed dated 24-12-1998, 8-1-1999 and 29-1-2001 are identical to the prayers made in S.C.S. No.581/2006. The averments in the subsequent suit clearly indicate that according to the non-applicant No.1, the compromise deed was got signed by the applicant by practicing fraud, through coercion and misrepresentation.
13. The provisions of Order XXIII Rule 3-A of the Code specifically bar the filing of a suit for setting aside a decree on the ground that the compromise on the basis of which the decree was passed was not lawful. The explanation to Rule 3 of Order XXIII of the Code indicates that a compromise that is void or voidable under the Indian Contract Act, 1872 is not deemed to be lawful under Rule 3. In Banwarilal (supra), it was held by the Hon'ble Supreme Court that the compromise is sought to be challenged as being fraudulent when it is deemed to be void within the meaning ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 11/16 of the explanation to the proviso to Rule 3 of Order XXIII of the Code and as such, is not lawful. The prayer for setting aside the compromise has to be made before the same Court which recorded the compromise. Similarly, in Horil (supra), this position was reiterated and it was held that a separate suit for challenging the compromise on the ground that it was obtained by fraud was not maintainable. In R. Rajanna (supra), it was again held that a separate suit of the present nature for challenging a compromise as not being lawful was not maintainable.
From the aforesaid, therefore, the legal position is well settled as regards remedy available for challenging a compromise which is not lawful. That a compromise which is obtained through fraud, with coercion and through misrepresentation would not be lawful also does not admit of any doubt. Thus, the only recourse that is available in such case is to approach the same Court under provisions of Order XXIII Rule 3 of the Code. The same cannot be done by a separate suit which is barred in view of provisions of Order XXIII Rule 3A of the Code.
14. In the light of aforesaid legal position, the question is whether the plaint is liable to be rejected under provisions of Order VII Rule 11(a) and/or (d) of the Code. In S.C.S. No.5055/2012 it has been pleaded that S.C.S. No.581/2006 ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 12/16 came to be compromised and this compromise dated 24-10-2008 was null and void. The pleadings to that effect can be found in paras 31 to 33 of the plaint. If these are the pleadings in S.C.S. No.5055/2012, it is obvious that this suit would be barred in view of provisions of Order XXIII Rule 3A of the Code. The pleadings in paras 31 to 33 of S.C.S. No.5055/2012 are by themselves sufficient to attract provisions of Order VII Rule 11(d) of the Code. The judgment in the case of Bhauram (supra) therefore, does not support the stand of the non-applicant No.1 as only the averments in the plaint have been considered while deciding the application under Order VII Rule 11(d) of the Code. It will, therefore, have to be held that in view of aforesaid averments appearing in S.C.S. No.5055/2012 and on a plain reading of the plaint, the suit itself is barred by law.
15. According to the applicant, the suit is also barred by limitation in view of the fact that the cause of action for filing the said suit is stated to have accrued on 24-10-2008 and the suit was filed on 1-12-2012. This was more than three years from the accrual of the cause of action and hence, it was beyond the period of limitation prescribed by Article 59 under the Limitation Act, 1963. That a suit which is barred by limitation can also be dismissed under provisions of Order VII Rule 11 of the Code is not ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 13/16 in dispute. In Hardesh Ore Limited Vs. Hide and Company 2007 (5) Mh.L.J. 571, it was held that the expression barred by law would include the law of limitation. Considering the cause of action as pleaded and the fact that admittedly the suit has been filed beyond the period of three years from its accrual, the suit is even otherwise barred by limitation under Article 59 of the Limitation Act, 1963. Though it has been averred that the cause of action was continuous in view of the subsequent mutation entries, these mutation entries are based on the sale deeds in question and are merely the consequence of execution of said sale deeds. If the challenge to the sale deeds in question is barred by limitation, the challenge only to the mutation entries also cannot succeed. It was also urged on behalf of the non-applicant No.1 by relying upon the judgment of the Hon'ble Supreme Court in Balsaria Construction Pvt. Ltd. (supra) that the question of limitation was a mixed question of law and fact. However, the same does not appear so in the present case inasmuch as the suit is based on the compromise decree dated 24-10-2008 and the sale deeds referred to herein above. Thus, even on this count, the suit appears to be barred by law of limitation under provisions of Order VII Rule 11(d) of the Code.
16. The learned Counsel for the non-applicant No.1 tried ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 14/16 to salvage the case of the non-applicant No.1 by urging that there were other reliefs sought in the plaint and hence, the entire plaint was not liable to be rejected. This submission cannot be accepted for the reason that the prayer with regard to declaration that the mutation entries taken on the basis of the sale deeds in question were liable to be set aside cannot be considered independently of the challenge to the sale deeds on the basis of which the same were effected. Moreover, absence of one defendent in the subsequent suit also cannot be a ground for refusing the prayer for rejecting the plaint.
17. The matter can be viewed from another angle. Even if the prayer with regard to setting aside the compromise decree is kept aside for some time, under provisions of Order XXIII Rule 1(3) of the Code, it is open for the plaintiff to withdraw the suit or such part of the claim with liberty to institute a fresh suit in respect of the subject matter of such suit or such part of the claim.
However, such withdrawal without the permission of the Court precludes the plaintiff from instituting any fresh suit in respect of such subject matter or such part of the claim. Admittedly, the earlier suit was withdrawn without reserving any right or liberty to file any fresh suit. No permission of the Court was sought in that regard. Thus, even under provisions of Order XXIII Rule 1(4) of ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 15/16 the Code, the non-applicant No.1 was precluded from instituting the subsequent suit for challenging the sale deeds dated 24-12- 1998 and 29-1-2001 or for that matter seeking declaration as to the legality of the sale deed dated 8-1-1999. This is one more reason why the plaint is liable to be rejected under provisions of Order VII Rule 11(d) of the Code.
18. The trial Court misdirected itself when it rejected an application moved by the applicant below Exhib-33. The averments in the plaint in Special Civil Suit No.5055/2012 were sufficient to come to the conclusion that the plaint was liable to be rejected. As the trial Court had failed to consider said application in the proper perspective, the applicant had moved an application seeking review of said order by filing an application below Exhib.49. Similarly, the written notes of argument were also sought to be relied upon by the applicant. However, said application was also rejected. It is, therefore, clear that the trial Court by rejecting the application below Exhibit-33 has failed to exercise the jurisdiction vested in it for rejecting the plaint under provisions of Order VII Rule 11(d) of the Code. The impugned order suffers from material irregularity and is thus, liable to be set aside.
::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 ::: CRA88.14.odt 16/1619. In view of aforesaid discussion, the following order is passed:
ORDER (1) The order dated 30-6-2014 passed below Exhibit-33 as well as the order dated 15-9-2014 passed below Exhibit-49 in Special Civil Suit No.5055/2012 are set aside. (2) The application below Exhibit-33 is partly allowed and the plaint in Special Civil Suit No.5055/2012 stands rejected under provisions of Order VII Rule 11(d) of the Code. (3) The Civil Revision Application is allowed in aforesaid terms with no order as to costs.
JUDGE //MULEY// ::: Uploaded on - 29/02/2016 ::: Downloaded on - 29/02/2016 23:06:16 :::