Calcutta High Court (Appellete Side)
Habitat Developers (P) Limited vs S. M. Sahid Alam And Others on 21 September, 2010
Author: Tarun Kumar Gupta
Bench: Tarun Kumar Gupta
1
IN THE HIGH COURT AT CALCUTTA
CIVIL APPELLATE JURISDICTION
Present: The Hon'ble Mr. Justice Tarun Kumar Gupta
S. A. No.144 of 2006
Habitat Developers (P) Limited
Versus
S. M. Sahid Alam and others
For the appellant: Mr. Sabyasachi Bhattacharya
Mr. Kallol Basu
For the respondents: Mr. Ganesh Srivastava
Mr. Sukanta Das Heard on : 06.09.2010 and 08.09.2010 Judgment on: September 21, 2010 Tarun Kumar Gupta, J.:-
This Second Appeal is directed against judgment and decree dated 28th June, 2001 passed by learned Civil Judge (Senior Division), 3rd Court at Alipore in Title Appeal No.85 of 2001, affirming the order dated 6th February, 2001 passed by learned Civil Judge (Junior Division), 1st Court in Alipore in Title Suit No.556 of 1995 thereby rejecting the plaint of the said suit.
Appellants' / plaintiffs' case in short is that they are developers and that respondents / defendants being the owners of the suit property entered into an 2 agreement for sale-cum- development with the plaintiff by executing an agreement. Respondents / defendants received a token amount of Rs.5001/- as earnest money vide receipt dated 10.02.1989. In spite of repeated requests defendants did not comply their part as per said agreement and rather sent an advocate's letter dated 6th February, 1990 with some fictitious allegations against plaintiffs. Though plaintiffs replied against said letter but no reply came either from the side of defendants or from their lawyer. Though plaintiff company spent considerable amount as the ground work for implementation of the agreement but respondents / defendants did not respond in any way. As defendants were trying to enter into an agreement for development of suit property with a third party, plaintiff filed a Title Suit being No.476 of 1990 for permanent injunction, damages and other consequential reliefs. However, said Title Suit No.476 of 1990 was dismissed for default on 23.04.1991. Appellants / plaintiffs recently came to know that respondents / defendants were trying to execute agreement with other persons as was evident from a letter dated 15th November, 1995 issued by a lawyer, and accordingly appellant / plaintiff filed the present suit praying for permanent injunction restraining defendants and their men and agent from making any further agreement for sale-cum-development or lease or any instrument of transfer relating to suit property together with a decree for damages and other consequential reliefs.3
Defendant No.3 filed a petition under order 7 Rule 11 C. P. C. denying material allegations of the plaint and contending inter alia that the suit was hopelessly barred by limitation under Article 113 of the Limitation Act as alleged date of agreement was 10.02.1989 and the suit was filed on 27.11.1955 and that the plaint was liable to be rejected under Order 7 Rule 11 C. P. C. Learned Trial Court after contested hearing rejected the plaint being time barred.
Learned First Appellate Court also upheld said order of learned Trial Court on the ground that the agreement was not properly stamped as per Indian Stamp Act (West Bengal Amendment), and that the suit for permanent injunction was not maintainable as plaintiff had no right, title, interest or possession in the suit property, and that the suit was also time barred.
Being aggrieved with said order of learned First Appellate Court, this Second Appeal has been filed. At the time of admission of the second appeal it was observed by the Division Bench that this appeal would be heard on the ground No. 1, 2 and 3 as per memo appeal vide order dated 02.03.2006. The grounds are enumerated below.
(I) For that in view of the present and continuing cause of action in the appellant's suit for permanent injunction, the learned Courts below erred in law in holding the said suit to be barred by limitation.4
(II) For that the learned lower Appellate Court proceeded on an entirely erroneous footing in holding that the agreement between the parties dated February 10, 1989 was not duly stamped, in view of there being no such requirement in 1989 to put in stamps as per conveyance envisaged by an agreement. (III) For that the learned Courts below committed a patent error of law in misappreciating the scope of Order 7 Rule 11 C. P.C. by prematurely entering into the merits of the plaintiff/appellant's suit and not confining themselves to the criteria stipulated in the said provision of law.
All the grounds framed by the Division Bench are taken up together for sake of convenience and brevity. Before discussing the arguments preferred by learned advocates of either side it would be worthy to note the admitted facts of the case which may be summarized as follows:-
(1) The respondents / defendants being owners of suit premises entered into an agreement of joint venture for development of the suit premises with the plaintiff developer under agreement dated 10.02.1989.
(2) As per plaint case at the time of said execution of agreement a token sum of Rs.5001/- was paid as earnest money to the defendants.5
(3) After said agreement though plaintiff developer took some positive steps in terms of said agreement but there was no response from the side of the respondents / defendants.
(4) Plaintiff company received a letter dated 06.02.1990 from one Mr. Ekramul Haque, claiming to be an advocate of defendant No.4 making some fictitious allegations.
(5) In spite of reply by plaintiff's advocate and attempts made by plaintiff to contact defendants, defendants avoided plaintiff.
(6) After knowing that the defendants were trying to enter into agreement for self-
same property with third party for development, plaintiff filed a suit being Title Suit No.476 of 1990 for permanent injunction, damages and other consequential reliefs.
(7) Said Title Suit No.476 of 1990 was dismissed for default on 23.04.1991. (8) Said Title Suit No.476 of 1990 was not restored by invoking Order 9 Rule 9 C. P. C. (9) As per plaint though plaintiff approached defendants but there was no response from the defendants.
(10) From a letter dated 15.11.1995 of a lawyer the plaintiff came to know that the defendants were going to execute an agreement with other persons for development of the suit property.
6(11) As per plaint, the cause of action arose firstly on 10.02.1989, then 3rd week of September, 1990 and on various dates till month of September, 1995. (12) The present Title Suit No.556 of 1995 was filed on 27.11.1995.
Sri Sabyasachi Bhattacharya, learned advocate for the appellant, has submitted that while adjudicating a prayer for rejection of plaint under Order 7 Rule 11 of the Code of Civil Procedure, the Court is required to see whether on plain reading of the plaint any of the grounds mentioned under Order 7 Rule 11 are present and that no further document is required to be considered at that stage.
In this connection he has referred a case law reported in 2005 (4) CHN 391 (Swapan Karak versus Allahabad Bank and Ors.) He has further submitted that the bar under Order 9 Rule 9 of the Code of Civil Procedure comes into operation only when a suit is filed subsequently on the same cause of action. According to him the present suit for injunction was based on a continuing cause of action and that the immediate basis was a letter dated 15th November, 1995 to the effect that the defendants were trying to enter into development agreement with third party. According to him, the cause of action of the present suit was distinct and different from the cause of action of the earlier suit being No.476 of 1990. In this connection, he has further referred a case law reported in AIR 1955 Calcutta page 169 (Mrs. L. A. Saunders v. Land Corporation of Bengal 7 Ltd.). According to Mr. Bhattacharya the suit was not time barred as it was suit for permanent injunction which was based on a continuing cause of action.
In this connection, he has further contended that Section 14 (3) ( c ) (iii) of the Specific Relief Act, 1963 was not a bar to said suit as it was a suit for permanent injunction and not for specific performance of a contract. He has further submitted that the plaint was not manifestly vexatious but did disclose a clear right to sue and as such the same cannot be nipped in the bud.
Mr. Ganesh Srivastava learned advocate for the respondents on the other hand has submitted that under Section 14 (3) of the Specific Relief Act the plaintiff who was admittedly a developer in terms of the purported agreement dated 10.02.1989 was not entitled to institute any suit for specific performance of said development agreement and as such filed a suit for injunction to take a chance. According to him, said suit for injunction without any prayer for specific performance of the contract was not maintainable as plaintiff developer was neither in possession of the property nor had any claim over the property on account of alleged development agreement. In this connection he has referred a case law reported in (2006) 2 CAL LT 157 (H.C.) (Vipin Vimani and another v. Smt. Sunanda Das and another). In the referred case law it was specifically held by this Hon'ble Court that from the provisions contained in Section 14(3) (c ) of the Specific Relief Act it is clear that a suit for specific performance of development agreement at the instance of a developer is clearly hit 8 by the provisions contained therein and that developer is not also entitled to get any consequential relief for permanent injunction for revocation of agreement and that the developer being agent was only entitled to get damages, if any. Admittedly, the instant suit of 1995 was filed by the developer against the owners of the property praying for permanent injunction restraining them from entering into agreement with the third party for development of the suit property. Said suit for permanent injunction was not maintainable in view of the ratio of the above referred case law.
However, it is a fact that on account of revocation of said development agreement by a letter dated 06.02.1990 issued by Mr. Haque, advocate of the defendants, as well as by the conduct of the defendants, the plaintiff had only claim of damages, if any, against the defendants. Earlier suit being Title Suit No.476 of 1990 for permanent injunction and damages etc. was filed against the present defendants over the self-same matter which was dismissed for default on 23.04.1991. Cause of actions of said earlier suit of 1990 arose through agreement dated 10.02.1989 and letter dated 06.02.1990 of Mr. Haque.
It is true that in the present suit of 1995 the cause of action was reported to arise firstly on 10.02.1989 and then in the third week of September, 1990 and on various dates till the month of September, 1995.
I have already stated that a suit for permanent injunction filed by a developer against the owner of the property restraining them from entering into agreement with 9 third party over the self-same property is not maintainable. As such the assertions of learned advocate for the appellant that the present suit being a suit for permanent injunction had a continuing cause of action had no leg to stand upon. The only relief available to the appellant / plaintiff was that of damages, if any, against the respondents / defendants. As per earlier suit of 1990 the cause of action for said claim of damages arose on 10.02.1989 and then in 1990 when Mr. Haque sent a letter repudiating the agreement of 1989. Admittedly, the time limit of three years therefrom has elapsed, and any suit for damages on same cause of actions is barred by limitation. It is true that in the present suit of 1995 the appellant / plaintiff has tried to make out a new cause of action, by way of receiving a letter dated 15.11.95 from a lawyer, intimating that the defendants were going to execute an agreement with a third party for development of the suit property. But said letter dated 15.11.95 cannot revive the claim of appellant / plaintiff towards damage which has already been time barred as three years have since been passed from 1990. There is nothing in the plaint to show that after sending of advocate's letter in 1990 by the defendants intimating repudiation of the agreement of 1989, the defendants showed any interest or had any further correspondence with plaintiff over said agreement of 1989. If that be the position then there is no scope of extending the cause of action beyond 1990 for filing a suit for damages. Even the alleged letter dated 15.11.95 of a lawyer cannot extend the cause of action for filing a suit for damages beyond three years 10 from February, 1990. In this connection, the case law reported in (1977) 4 SCC Page 467 (T. Arivandandam versus T. V. Satyapal and another) may be referred wherein Hon'ble Apex Court held that if on a meaningful and not formal reading of the plaint it is found to be manifestly vexatious and meritless in the sense of not disclosing a clear right to sue, learned Trial Court should exercise its power under Order 7 Rule 11 C. P.C. I am of the opinion that meaningful reading of the plaint includes reading and / or considering the document and / or facts referred in the plaint. In the instant case the facts of filing of the earlier suit in 1991 and of receiving the letter of advocate in 1990 were mentioned in the plaint of 1995. As such no error was committed by Lower Appellate Court in considering those facts at the time of examining the applicability of order 7 rule 11 C. P. C. in the facts of this case. 'Plain reading' as referred in Swapan Karak's case (supra) includes meaningful reading and not just formal reading. However, it is a fact that the observation of learned lower Appellate Court regarding bar on account of Stamp Act is not proper and is rather out of context.
Learned Advocate for the respondents has further submitted that the allegation that in September, 1995 again the plaintiff came to know from a lawyer's letter that the defendants were trying to enter into an agreement with third party for development of the suit property, was purely illusory to get around the laws of limitation. According to him, the plaintiff made material suppression of the contents 11 of the letter of Mr. Haque, learned advocate by which the agreement of 1989 was repudiated and cancelled in the year 1990 and that said omission tantamount to suppression of material facts leading to incomplete cause of action and that on that score the plaint was bad in law.
In this connection he has referred a case law reported in 2004 3 SCC page 137 (Sopan Sukhdeo Sable and others v. Assistant Charity Commissioner and others.). Learned advocate for the respondents has also submitted relating to the effects of non-registration of plaintiff Company under Promoter Act of 1993 and of not taking permission for undertaking construction work under development agreement and referred a case law. But in view of foregoing discussions no discussion is required in this regard.
From the above discussions it is clear, and crystal clear that the appellant's / plaintiff's suit for permanent injunction was not maintainable in law, and that the prayer for damages was also barred by limitation, and that ultimate findings of learned Lower Appellate Court affirming order of rejection of plaint under order 7 Rule 11 C. P.C. passed by learned Trial Court is correct. Hence, it does not call for any interference by this Court of Second Appeal. As a result, the appeal stands dismissed.
However, I pass no order as to costs.
12Office is directed to send down L.C.R. along with a copy of the judgment to the Lower Court expeditiously.
Urgent xerox certified copy of this judgment be supplied to the Counsels of the party / parties, if applied for.
(Tarun Kumar Gupta, J.)