Delhi District Court
Sh. Lekh Raj vs Sh. Hukum Chand (Deceased) on 7 September, 2011
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IN THE COURT OF SH. GOPAL SINGH CHAUHAN, CIVIL JUDGE
(WEST)2, DELHI
SUIT NO.291/02
Unique Case ID No.
Sh. Lekh Raj,
S/o Sh. Dayal,
R/o 3789/21, Rehgarpura, Karol Bagh, New Delhi.
..........................PLAINTIFF
VERSUS
1. Sh. Hukum Chand (deceased)
Through legal heirs
(a) Sh. Mahender Kanwadia
S/o Late Sh. Hukam Chand,
R/o H348, 2nd Floor, New Rajinder Nagar, New Delhi
2. Delhi State Cooperative Bank Ltd.
31, Netaji Subhash Marg, Darya Ganj, New Delhi
3. Sh. Tara Chand
S/o Sh. Ram Prasad,
R/o 3787/20, Rehgarpura, Karol Bagh, New Delhi
4. Smt. Anandi Devi
W/o Sh. Tara Chand,
R/o 3787/20, Rehgarpura,
Karol Bagh, New Delhi
........................DEFENDANTS
Suit No.291/02 Page 1/18
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Suit filed on - 27/02/1989
Judgment reserved on 19/08/2011
Date of decision - 07/09/2011
SUIT FOR DECLARATION, PERMANENT INJUNCTION AND
RECOVERY OF RS.2,80,000/.
JUDGMENT: By this judgment I shall dispose off a suit for declaration, permanent injunction and recovery of Rs.2,80,000/ filed by the plaintiff.
Initially the present suit was filed against defendants no.1 and 2. Vide order dt. 02/09/97 an application U/O 1, R.10, C.P.C. was allowed and defendants no. 3 and 4 were also impleaded as defendants. Also vide orders dt. 13/05/98 and dt. 03/07/02 plaint was allowed to be amended.
1. The brief facts necessary to be discussed for the fair disposal of the present suit, as per amended plaint are that the plaintiff was the owner of property no. 3787/20, Rehgarpura, Karol Bagh, New Delhi. Sh. Hukum Chand brother of the plaintiff (defendant no.1 herein) was the owner of property no. 3798/21, Rehgarpura, Karol Bagh, New Delhi. On 14/03/1963, the defendant no.1 mortgaged his property in favour of Delhi State Cooperative Society Bank Ltd as security for a loan of Rs.8,000/. Without disclosing the said fact, on or about 10/06/1966, the defendant no.1 entered into a deed of exchange with the plaintiff Suit No.291/02 Page 2/18 3 whereby plaintiff became the owner of house No. 3798/21 and defendant no.1 became the owner of house no. 3787/20. It seems that after the execution of the deed of exchange, the defendant no.2, Delhi State Cooperative Bank Ltd., in collusion and conspiracy with the defendant no.1 advanced him some loan against the security of the property No. 3798/21, which the defendant no.1 was otherwise not entitled to mortgage. After the default in repayment of said amount, the defendant no.2 in collusion and conspiracy with the defendant no.1, obtained an award dt.26/09/1997 for recovery of an amount of Rs.63,820.71/ from the court of Joint Registrar, Cooperative Societies, Delhi, U/S 66 of the Delhi Cooperative Societies Act and sent a certificate for the recovery of said award amount to the Additional Collector, Delhi, for execution and recovery. On 08/01/1985 an order of attachment in this regard was passed by the Additional Collector, Delhi, in respect of the property No.3798/21. Thereafter, property No. 3798/21 was ordered to be auctioned and a notice of auction was published in the 'Hindustan Times' dt.29/03/1987.
After coming to know about proposed auction on 14/04/1987, the plaintiff moved an application seeking stay of auction, which was proposed to be held on 16/04/1987 but he did not succeed in his attempt and the property was ultimately auctioned on 16/04/1987 for Rs.2,15,000/. Lateron under threat of sale, on 04/05/1987 the plaintiff submitted a settlement where under on 12/05/1987 he paid an amount of Rs.80,000/ to the defendant no.2 and paid further amount of Rs.20,000/ on 15/05/1987. The plaintiff also filed a bank guarantee for the balance amount on 26/05/1987. Thereafter, the plaintiff further paid sum of Rs.4,000/, Rs.16,000/, Rs.30,000/ and Rs.40,000/ on various dates Suit No.291/02 Page 3/18 4 in furtherance of the above undertaking and in satisfaction of the said bank guarantee. The plaintiff has paid total amount of Rs.1,90,000/ to the defendant no.2 in execution of the aforesaid recovery certificate without any reason whatsoever. The plaintiff requested the defendant bank to pay back the said amount but the bank failed to pay any heed and as such the plaintiff was constrained to serve notice U/S 90 of the Delhi Cooperative Societies Act on 15/11/1988.
It has been prayed that a decree of mandatory injunction against the defendant no.2 directing it to execute a sale deed in respect of the property no. 3798/21, a decree for declaration declaring the deed of exchange dt.10/06/1966 being void, illegal and unenforceable and a decree for mandatory injunction against the defendant no.1 restraining him from selling, transferring,alienating,etc., the property no.3787/20, be passed in favour of the plaintiff.
2. The suit was duly contested by the defendants no. 1 & 2 by filing the WS. Separate written statements were filed on behalf of both the defendants. Whereas no WS was filed on behalf of defendants no. 3 & 4 and vide order dt. 22/07/98 they were proceeded exparte.
In written statements certain preliminary objections were taken like, no suit for declaration simplicitor is maintainable regarding the deed of exchange, the suit is bad for nonjoinder of necessary parties, notice to the Registrar Co operative Societies as per Section90 of the Delhi Cooperative Societies Act, Suit No.291/02 Page 4/18 5 1972, was not served, the suit is barred under the provisions of section93 of Delhi Cooperative Societies Act, 1972 and that the suit is barred by time.
In WS filed by defendant no.1 it is also submitted that defendant no.1 and the plaintiff were members of Dyal Footwear Cooperative Industrial Societies Ltd. That to secure repayment of the loan advanced by the defendant no.2, a mortgage by depositing of title deeds and Jamabandi was created as a continuing guarantee by the plaintiff and the defendant no.1 in respect of the property no.3798/21 in favour of defendant no.2 on 14/03/1963. The plaintiff was a party to this transaction. The plaintiff was actually aware of the loan and continue security given besides the delivery of relevant documents to defendant no.2. Because of this reason no document of title of the property were delivered on 10/06/1966, when the ownership of the property no.3798/21 was transferred to the plaintiff. The property in question was transferred to plaintiff subject to the charge of the defendant no.2. This was due to the reason that the market value of the property transferred to the plaintiff was twice the market value of the property transferred to the defendant no .1. All other averments made in the plaint were denied.
In WS filed on behalf of defendant no.2 it has been submitted that the defendant no.2 had allowed CCL of Rs.8,000/ to the Dyal Footwear Co operative Industrial Societies Ltd. in the year 1963 against the mortgage of the house no.3798/21. The said CCL was raised subsequently to Rs.60,000/. Other averments already disclosed in the plaint, related to putting up of property on auction, making of settlement by the plaintiff, etc., are admitted. All other averments made in the plaint were denied.
Suit No.291/02 Page 5/18
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3. The plaintiff has filed the replication wherein the plaintiff has reiterated and reaffirmed the facts mentioned in the plaint and denied the facts mentioned in the Written statements.
4. On the basis of the pleadings of the parties the issues were framed on 09/10/03 which are as under : (1) Whether the present suit is bad for nonjoinder of necessary parties?
OPD (2) Whether the suit is bad by Section93D of Delhi Cooperative Society Act? OPD (3) Whether the suit is filed within limitation period? OPP (4) Whether the plaintiff is entitled to declaration as prayed for? OPP (5) Whether the plaintiff is entitled to the relief of permanent injunction as prayed for? OPP (6) Whether the plaintiff is entitled to the relief of mandatory injunction as prayed for? OPP (7) Relief.
In support of his case the plaintiff got examined two PWs i.e. himself as PW1 and Sh. Rameshwar Dayal as PW2. Certain documents were also got exhibited as under : Ext. PW1/1 is the copy of mortgage deed. Ext. PW1/2 is the copy of exchange deed dt.10/06/1966. Ext. PW1/3 is the copy of award dt.26/09/1977. Ext. PW1/4 to PW1/9 are the copies of receipts. Ext. PW1/10, 1/11 & 1/12 are Suit No.291/02 Page 6/18 7 copies of notice dt.15/11/1988, postal receipt and AD Card respectively. Ext. PW1/13 is the letter dt.14/2110/1988. Ext. PW1/14 is the letter dt.27/05/1998 sent by plaintiff.
In defence defendant has examined Sh. Rajesh Sharma as DW1. Certain documents were also got exhibited as under : Ext. DW1/1 is the authority letter in favour of DW1. Ext. DW1/2 is the copy of mortgage deed dt.14/03/1967.
5. The arguments have been heard and the record has been carefully perused. Now, I shall give my issue wise findings which are as under:
6. ISSUE NO.1 & 2 Whether the present suit is bad for nonjoinder of necessary parties? OPD Whether the suit is bad by Section93D of Delhi Cooperative Society Act? OPD The onus to prove these issues was upon the defendants and the same are based on the objections taken in WS on behalf of defendant no.2.
It has been contended on behalf of defendant no.2 that the present suit is bad for nonjoinder of necessary parties. That the plaintiff has not impleaded the Recovery Officer, Cooperative Societies, Delhi as a party though the plaintiff is seeking a relief against the letter dated 14/211088 issued by him.That the plaintiff has also not impleaded the Additional Collector from the office of Recovery Officer, Cooperative Societies, Delhi Registrar, Cooperative Societies, Delhi who has auctioned the property in question. Suit No.291/02 Page 7/18
8 In the present matter among other reliefs the plaintiff has sought the relief in the form of decree of mandatory injunction against defendant no.2 by directing it to execute a sale deed in favour of plaintiff in respect of property no. 3798/21 after receipt of the balance demand as demanded in letter no. F JR/R/Coop/56/7677/1476, dated 14/21.10.1988. The said letter is exhibited as EX. PW1/13 on record. This letter was issued by Recovery Officer, Co operative Societies, Delhi. As the abovestated relief is mainly based on the abovementioned letter, the Recovery Officer, Cooperative Societies, Delhi is a necessary party to the suit.
In WS filed on behalf of defendant no.2 it is contended that after obtaining certificate under Section 71 of the Delhi Cooperative Societies Act, 1972, the matter was referred to Additional Collector, Cooperative Societies, Delhi for recovery of awarded amount by way of attachment and sale of the mortgaged property. That the property was auctioned by him. That the plaintiff approached the office of the Joint Registrar, Cooperative Societies, Delhi for compromise/settlement and as per order of Additional Collector the plaintiff deposited Rs. 1.90 lakhs with him.
In view of above the Additional Collector, Cooperative Societies, Delhi also appears to be a necessary party in the present suit. Order1,Rule9, C.P.C. Provides Misjoinder and nonjoinder No suit shall be defeated by reason of the misjoinder or nonjoinder of parties, and the Court may in every suit deal with the matter in controversy so far as regards the rights and interests of the parties actually before it: Suit No.291/02 Page 8/18
9 [Provided that nothing in this rule shall apply to nonjoinder of a necessary party.] In view of above provision it is clear that in case of nonjoinder of a necessary party suit can be defeated.
Another objection taken on behalf of defendant no.2 is that the suit is barred U/S 93 of Delhi Cooperatives Societies Act, 1972. Section 93. Bar of Jurisdiction of court.
(1) Save as provided in this Act, no civil or revenue court shall have any jurisdiction in respect of
(a) xxxxx
(b) xxxxx
(c) any dispute required under Section60 to be referred to the Registrar;
and
(d) xxxxx
60. Disputes which may be referred to arbitration.
(1) Notwithstanding anything contained in any law for the time being in force, if any dispute touching the constitution, management or the business of a cooperative society other than a dispute regarding disciplinary action taken by the society or its committee against a paid employee of the society arises-
(a) xxxxx (b) between a member, past member or person claiming through a
member, past member or deceased member and the society, its committee or any Suit No.291/02 Page 9/18 10 officer or any officer, agent or employee of the society or liquidator, past or present, or
(c) xxxxx
(d) xxxxx Such disputes shall be referred to the Registrar for decision and no court shall have jurisdiction to entertain any suit or other proceedings in respect of such dispute.
(2) For the purposes of subsection (1), the following shall be deemed to be disputes touching the constitution: management or the business of cooperative society, namely :-
(a) a claim by the society for any debt or demand due to it from a member or the nominee, heirs or legal representatives of a deceased member, whether such debt or demand be admitted or not;
(b) xxxxx (c) xxxxx
As the subject matter of the present suit is based on the dispute between the plaintiff and the defendant no.2 society, in view of the above cited provisions of law the suit is found to be barred against defendant no.2.
In view of the above discussions these issues are decided in favour of the defendants and against the plaintiff.
7. ISSUE NO.3,4,5 & 6 Whether the suit is filed within limitation period? OPP Suit No.291/02 Page 10/18 11 Whether the plaintiff is entitled to declaration as prayed for? OPP Whether the plaintiff is entitled to the relief of permanent injunction as prayed for? OPP Whether the plaintiff is entitled to the relief of mandatory injunction as prayed for? OPP The onus to prove these issues was upon the plaintiff. The plaintiff has prayed for a decree of declaration thereby declaring the deed of exchange dt.10/06/1966, Ext. PW1/2, being void, illegal and unenforceable by law. There appears inherent defect in the above prayer sought by the plaintiff. The plaintiff has himself admitted that on 10/06/66 the defendant no.1 entered into a deed of exchange with him in respect of property No.3798/21, although, it has been claimed that the same was done without disclosing the factum that the said property was already subject to mortgage.
It is settled proposition of law that where a person is a party to a written instrument and he claims that such instrument is void or voidable he should seek remedy of cancellation of such instrument, as provided U/S 31 of Specific Relief Act and mere prayer for declaration is not maintainable.
In the present matter it has not been specifically mentioned in the plaint as to on what ground the exchange deed Ext. PW1/2 is sought to be declared void, illegal, etc. It is claimed by plaintiff that the exchange deed, Ext. PW1/2 got executed by defendant no.1 without disclosing the fact that the property No.3798/21 has already been mortgaged vide mortgage deed dt. 14/03/63, Ext. PW1/1, with defendant no.2.
Suit No.291/02 Page 11/18
12 Section17 of Indian Contract Act provides "Fraud" means and includes any of the following acts committed by a party to a contract or with his connivance, or by his agents, with intend to deceive another party thereto or his agent, or to induce him to enter into the contract;
(1) xxxxxxx (2) the active concealment of a fact by one having knowledge of belief of the fact. (3) xxxxxxx (4) xxxxxxx (5) xxxxxxx
From the facts available on record it can be inferred that the exchange deed Ext. PW1/2 is sought to be declared void on the basis of alleged fraud committed by defendant no.1.
8. In WS filed on behalf of defendant no.1 the execution of exchange deed has not been denied. However, it has been submitted that the plaintiff and defendant no.1 were members of Dayal Footwear Cooperative Industrial Society Ltd. That defendant no.2 advanced a loan and in consideration thereof and to secure repayment of the loan, as a continuing guarantee, a mortgage by deposit of title deeds and Jamabandi, was created by the plaintiff and the defendant no.1 in respect of property No.3798/21 and in favor of defendant no.2 on 14/03/1963. It is also submitted that the plaintiff was an executive committee member of the Society since inception and was actively involved in the day to day affairs of the society. That he was party to this transaction. It is claimed that the plaintiff was Suit No.291/02 Page 12/18 13 actually aware of the loans and the continuing security given, besides the delivery of relevant documents to defendant no.2. That the plaintiff understood and was aware of the fact that the mortgage was to secure the ultimate liability of the society to the defendant no.2. That it is because of this simple reason no documents of title of the property No.3798/21, were delivered at the time of execution of exchange deed. It is further submitted that the plaintiff was a party to the creation of mortgage and was aware of it. That the property was transferred to the plaintiff subject to charge of defendant no.2. That this was due to the reason that the market value of the property transferred to the plaintiff was twice the market value of the property transferred to the defendant no.1 by virtue of exchange deed dt.10/06/66.
It has been claimed by plaintiff that at the time of execution of exchange deed he was not aware about the mortgage of property No.3798/21. It is contended that the plaintiff came to know about the said fact only in April , 1987.
In WS it is the main contention of the defendant no.1 that the plaintiff was actually aware of the mortgage in question since its creation. That the mortgage was by depositing of original title deeds and Jamabandi and because of this simple reason no documents of property were delivered at the time of execution of exchange deed.
9. PW1 in his crossexamination deposed "I asked for the original title documents from my brother at the time of exchange of property, however, the same were not given as my brother stated that the said documents got destroyed due to some fire in the property. The fire took place in the house of my brother in Suit No.291/02 Page 13/18 14 the year 196364. I was residing together with my brother when the fire took place at house of my brother. Vol. My brother was residing in the adjacent room. No fire brigade was called at the time when the fire took place. I do not know whether my brother lodged a police complaint for the fire as took place in his house. I do not know as to which material was gutted in the said fire. After my brother informed me regarding the destruction of title documents I did not enquire about his title in the said property from any Government Department."
He further deposed "I had given an application in the MCD for transfer of house tax in my name. I also not remember the date, month and year when I made application to the corporation. Vol. I visited the office of corporation and met with the house tax officer who asked me to bring the original registry of the property and then only the house tax will be transferred. After that I never took the original registry to the house tax office."
He has also deposed "I have not written any letter to the bank after I came to know about the mortgage of the property with the bank."
10. A material contradiction appeared in the testimony of PW1 where at several places he stated that he came to know about the mortgage of the property when the bank official came to auction the property and affixed an auction notice on the property No.3798/21 whereas at another place he has stated that he came to know about the award passed by the Joint Registrar Cooperative Societies, Delhi as the same was published in the newspaper.
Perusal of exchange deed Ext. PW1/2 shows that it is silent regarding the mortgage in question. When a property is subject to mortgage it can be Suit No.291/02 Page 14/18 15 considered a material fact. If it is assumed that fraud was committed upon plaintiff by defendant no.1 by active concealment of above stated material fact regarding property No.3798/21 at the time of execution of exchange deed, then also the plaintiff has to sufficiently proved that he was not aware of such material fact at the relevant time.
During his crossexamination the plaintiff/PW1 has deposed that at the time of execution of exchange deed Ext. PW1/2, no title documents were given to him by the defendant and the defendant has told him that the same got destroyed due to some fire in the property. Plaintiff/PW1 has stated that he was residing alongwith the defendant no.1 in the same house. He also stated that fire took place in the year 196364 and at the time of incident of fire no fire brigade was called. He also stated that he was not aware as to which material was gutted in the said fire. He has also admitted that he never tried to obtain certified copy of the documents in respect of property No.3798/21. In WS of defendant no.1 it is averred that the plaintiff and defendant no.1 were the members of the society and being an active member the plaintiff was aware of the loan and mortgage of the property. In replication filed by plaintiff it is admitted that the plaintiff and defendant no.1 were members of the society although it is claimed that the plaintiff has resigned from there long back but no date on which the plaintiff allegedly resigned, was mentioned. Further, as already discussed above, material contradictions appeared in the testimony of plaintiff/PW1 as at some places he stated that he was not aware about the mortgage in question before the bank officials visit the property No.3798/21, for affixing notice whereas at another place he conceded that he came to know about the award through news paper. Suit No.291/02 Page 15/18
16 The story put forth by the plaintiff that at the time of execution of exchange deed Ext. PW1/2, he was not aware about the mortgage in question, appears to be highly doubtful. The plaintiff has failed to prove that any fraud was committed by defendant no.1 upon him at the time of executing exchange deed dt.10/06/66, Ext. PW1/2. Further he has failed to prove that claim for declaration in the present matter is made within period of limitation.
11. The plaintiff has also prayed for a decree of mandatory injunction against defendant no.2 directing it to execute a sale deed in respect of property No.3798/21, after receipt of the balance demand as demanded in letter dt. 14/21.10.1988, Ext. PW1/3.
Section38 of Specific Relief Act provides
38. Perpetual Injunction when granted -
(1) subject to the provisions contained in or referred to by this chapter, a perpetual injunction may be granted to the plaintiff to prevent the breach of obligation existing in his favour, whether expressly or by implication.
(2) xxxxxxxxx (3) xxxxxxxxx
In view of above cited provision of law it is clear that for obtaining relief of mandatory nature by way of permanent injunction it has to be proved by plaintiff that defendant no.2 was under obligation to execute the sale deed, as claimed by the plaintiff. The present relief has been claimed on the basis of letter dt.14/21.10.1988, Ext. PW1/3. This letter was sent by Joint Registrar (Recovery) Cooperative, Delhi, who has not been made a party in the present Suit No.291/02 Page 16/18 17 suit. By way of this letter the plaintiff herein was asked to deposit certain amount within 15days from receipt of the letter and it was stated that failing which the property would be reauctioned. It has not been proved on record by the plaintiff that he has complied with the terms of said letter within prescribed period or the terms of that letter were altered/modified lateron.
Letter dt.27/05/09, Ext. PW1/4, sent by plaintiff to the Registrar, Co operative Societies, New Delhi is on record. By way of this letter the plaintiff has desired to comply with the terms of letter dt.14/21.10.1988, Ext. PW1/3 and to deposit outstanding amount. It means that the plaintiff has himself impliedly admitted that he had not complied with the terms of letter dt.14/21.10.1988, Ext. PW1/3. In such a case it can be said that the defendant no.2 was not under any obligation towards plaintiff.
As no obligation is found existing in favour of the plaintiff, he is not found entitled to relief of mandatory injunction. Further the claim of plaintiff is hopelessly time barred.
12. The plaintiff has also claimed decree of permanent injunction against the defendants. The relief of permanent injunction claimed by the plaintiff is consequential in nature and is dependent on the other reliefs. As the plaintiff is not found to be entitled to the main reliefs, this consequential relief cannot be granted to him.
In view of above discussion these issues are decided in faovur of the defendants and against the plaintiff.
Suit No.291/02 Page 17/18
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9. ISSUE NO.5 RELIEF: On the basis of the evidence led by the parties, the documents placed on record, pleadings of the parties and also in the light of the findings given on the issue no. 1 to 6 (Supra), the suit of the plaintiff is hereby dismissed. No order as to costs..
Decree sheet be prepared accordingly. File be consigned to record room after due compliance.
(GOPAL SINGH CHAUHAN) Civil Judge (West)2, Delhi Announced in the open court on 07/09/2011.
Suit No.291/02 Page 18/18