Delhi High Court
Sheela Agarwal vs M/S.Infocom Digital Systems Ltd. on 25 April, 1998
Author: D.K. Jain
Bench: D.K.Jain
JUDGMENT D.K. Jain, J.
1. This is defendant's application under section 16 read with section 151 of the Code of Civil Procedure (for short the CPC) for rejection of the plaint/dismissal of suit on the ground that this court does not have territorial jurisdiction to try the suit.
2. The plaintiff has filed the present suit for specific performance, mandatory and permanent injunction, praying for a decree for specific performance of the agreement to sell an industrial plot, bearing no.52, Sector-34, Gurgaon Technology Park, Gurgaon (Haryana), for which the entire sale consideration stands paid. Alternatively, if the decree for specific performance cannot be granted, the plaintiff has prayed for a decree for a sum of Rs.20 lacs along with interest 30% per annum or market value of the said plot, whichever is higher, along with future interest. She has also prayed for permanent injunction restraining the defendant from alienating, mortgaging, selling or transferring the said property to anybody else. Plaintiff's case is that in the last week of September 1995, the defendant, a public limited company, through its Director Mr.S.L. Rastogi, known to the plaintiff, approached her for advancing of certain loan to the company; the plaintiff was induced to give a term loan, on interest at 30% p.a., of a total sum of Rs.20 lacs by means of various cheques, issued on 30 September 1995; the terms of the transaction were not reduced into writing because of the trust and confidence and the relationship of the plaintiff with defendant's Director, Mr.S.L. Rastogi, but despite the mutual agreement between the parties, whereby the defendant had agreed to pay the interest on or before 5th of every month, the defendant defaulted in making the said payment of interest and as the defendant made two consecutive defaults in payment of interest, the plaintiff vide her letter dated 2 January 1996 requested the defendant to refund the entire principal amount of Rs.20 lacs along with interest, upon which the said S.L. Rastogi approached the plaintiff with a request to wait for some period for refund of the amount as the company was facing financial problems; on her great insistence for refund of her money, the defendant came up with a proposal to sell the affronted industrial plot belonging to the company against the said amount of Rs.20 lacs; the proposal was accepted by the plaintiff; the terms and conditions therefore were mutually settled and an agreement to sell was signed between the parties on 15 January 1996, whereby the defendant sold the said plot for a total consideration of Rs.20 lacs which amount stood already paid and further handed over the actual vacant and physical possession of the said plot to the plaintiff on the same date; the only copy of the agreement to sell, which was signed by the plaintiff and Mahinder Pratap, Managing Director of the defendant was retained by the plaintiff; on 16 January 1996, S.L. Rastogi approached the plaintiff and requested her to hand over the agreement to sell since the same was required for obtaining the necessary permissions under the Income Tax Act etc.; the plaintiff, bonafide and in good faith, handed over the original agreement to sell to S.L. Rastogi, whereafter the defendant has been adopting dillydallying tactics. It is claimed that though the plaintiff has been ready and willing to perform her part of the contract, the defendant has totally failed and neglected to obtain the permission from Income Tax and other authorities as per the terms and conditions contained in the agreement to sell dated 15 January 1996 and is now threatening to mortgage the said plot of land with the bank in order to jeopardise the rights of the plaintiff in the plot and in case the defendant succeeds, the plaintiff would suffer irreparable loss and injury, which cannot be compensated in terms of money. Hence the present suit.
3. In the written statement filed on behalf of the defendant company, the stand of the plaintiff is refuted. It is denied that the company ever took any loan from the plaintiff and/or got any such loan converted into an agreement to sell. According to the defendant, the plaintiff, her husband, and son etc., had paid a sum of Rs.20 lacs towards the application money for allotment of One lac equity shares of the face value of Rs.10 at a premium of Rs.10 by making 24 applications signed by the different applicants, which applications the husband of the plaintiff, in connivance with certain persons working in the company, got removed and the alleged agreement to sell was a fabricated document. The threshold objection raised is that this court has no territorial jurisdiction to try the suit for specific performance of agreement to sell relating to land outside its territorial jurisdiction as the plaintiff is claiming a right and interest in the immovable property, situated at Gurgaon. It is stated that the title deeds of the subject plot were handed over by the defendant company to its bankers on 26 July 1995 against the financial assistance and since the property was already alienated otherwise also, there was no occasion for the company either to receive any amount against the industrial plot or to agree to sell the same to the plaintiff.
4. The short question for consideration is whether the present suit at Delhi is to be governed by section 16 or section 20 of the Code of Civil Procedure.
5. I have heard Mr.D.K. Garg, Advocate on behalf of the applicant and Advocate Mr.Anil Sapra on behalf of the plaintiff.
6. Section 16, CPC provides that subject to the pecuniary and other limitations prescribed by any law, suits for possession, or partition or foreclosure, sale, redemption etc., of immovable property or for determination of any other right to or interest in immovable property shall be instituted in the court within local limits of whose jurisdiction the property is situate. The Proviso to the section, on which reliance is placed by the learned counsel for the plaintiff, stipulates that a suit to obtain relief respecting, or compensation for wrong to, immovable property held by or on behalf of the defendant may, where the relief sought can be entirely obtained through his personal obedience, be instituted either in the court within local limits of whose jurisdiction the property is situate or in the court within local limits of whose jurisdiction the defendant actually and voluntarily resides or carries on business.
7. It is evident from the affronted facts that in the present case there is a bonafide contest between the parties regarding the possession of the property. The plaintiff claims that its possession was handed over on 15 January 1996 when the agreement to sell was allegedly entered into. The defendant denies it and claims that the suit property already stands alienated in favour of its bankers. No document has been produced by the plaintiff to show that the plaintiff is in possession of the subject plot. The defendant has, on the contrary, produced some documents in support of its pleas.
8. Thus, though the plaintiff has not specifically asked for a relief for possession, but in the present case, in view of the stand of the defendant, the suit is not only for specific performance of the agreement to sell, but essentially one for possession and the decree for specific performance would be one for possession as well. There is also a contest regarding the payment of consideration and whether the agreement to sell was executed by a competent person and further could it be sold or its possession be handed over to the plaintiff without the prior approval of the Estate Officer, Haryana Urban Development Authority, Gurgaon (Haryana).
9. All these questions necessarily involve the determination of rights set up by the parties in the suit property. What is sought is a relief against the property and not a mere relief in personam. It is relief against the property, which is sought to be adjudicated. The decision of the Calcutta High Court in Panchanan Mondol Vs. Tarapada Mondol & Ors , relied upon by learned counsel for the plaintiff, is clearly distinguishable on facts. In that case the court was dealing with a case where two parties had agreed to sell their respective properties, one in India and the other in Pakistan, to each other, for the same amount in each case; admittedly possession of the properties had passed and were with respective purchasers, only a sale deed in respect of land in India was to be executed by the party in Pakistan and when the suit for specific performance was filed in India against the vendor in Pakistan, it was held that the relief claimed was in personam and not against property and thus, the suit fell within the scope of the Proviso to Section 16 CPC, which is not the case here.
10. In this view of the matter, I have no hesitation in coming to the conclusion that the suit falls within the ambit of section 16(d) of the Code of Civil Procedure and the proviso thereto has no application on the facts of the present case.
11. I am, therefore, of the opinion and hold that this court does not have territorial jurisdiction to try this suit. Accordingly, I would direct that the plaint be returned to the plaintiff for presenting it to the court of competent jurisdiction.
12. The application stands disposed of in the above terms.