Delhi High Court
Shyam Gambhir vs Tara Chand & Others on 15 July, 2014
Author: Sanjeev Sachdeva
Bench: Sanjeev Sachdeva
IN THE HIGH COURT OF DELHI AT NE W DELHI
Order Reserved on: 23 rd April, 2014
Order Pronounced on: 15 th July, 2014
CS(OS) 2149/2010
SHYAM GAM BHIR ...... PLAINTIFF
Through: Mr. Yashank Adhiyaru, Sr.
Advocate with Mr. Ashish
Wad, Ms. Kanika Baweja
and Ms. Nidhi Revoo,
Advocates.
versus
T ARA CHAND & OTHERS ..... DEFENDANTS
Through: Mr. Rahul Sharma,
Advocate for D-1(a), Mr.
Vaibhav Kalra, Advocate
for D-1(b), Mr. Satish
Kumar Tripathi, Advocate
for D-5, Mr. Shyam
Moorjani and Mr. M.A.
Khan, Advocates for D-6
CORA M:
HON'BLE MR. JUSTICE SANJEEV SACHDEVA
SANJEEV SACHDEVA, J.
IA NOS. 2752/2012 (under Order VII Rule 11 CPC by Defendant No.5) & 17686/2012 (under Order VII Rule 11 CPC by Defendant No.6) IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 1 of 13
1. Plaintiff has filed the present suit for specific performance, declaration and permanent injunction seeking specific performance of Agreement dated 25.11.2007 in respect of property bearing No. 95, Ishwar Nagar, Khasra No.1522/328, situated at Okhla Extension, Bagh Shambhu Dayal at Bhapur, New De lhi measuring 550 sq. Yards .
2. As per the Plaintiff, late Sh. Tara Chand and Defendant Nos. 2 to 5 approached the Plaintiff for selling the above mentioned property for a total sale consideration of Rs.1,10,00,000/-. Sh. Tara Chand has expired and his legal heirs have been arrayed as Defendant Nos. 1(a) & 1(b).
3. As per the Plaintiff, an advance of Rs.25,50,000/- has been paid in the following manner:-
Nam e Date o f Cheque/ Amo unt Dra wn
Pay m ent Cash on
Tara Chand ( D- 25.11.07 2110854 50,000 SCB
1) 25.11.07 Cash 12,00,000 Cash
Kiran Nair 25.11.07 2110855 35,000 SCB
(D-3) 29.11.07 2110857 35,000 SCB
27.12.07 541547 1,00,000 ABN
21.01.08 670374 1,00,000 ABN
25.11.07 Cash 2,45,000 Cash
IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 2 of 13
Rita Nair 25.11.07 210856 35,000 SCB
(D-2) 25.11.07 Cash 2,00,000 Cash
Ka ushalya 25.11.07 Cash 5,00,000 Cash
(D-4)
Shya m Sunder 21.12.07 320831 50,000 SCB
To ta l 25,50 ,0 00
4. It is contended that Sh. Tara Chand had received a cheque on behalf of and in the name of Sh. Shyam Sunder Khosla, which was encashed by Sh. Shyam Sunder Khosla from the bank of the Plaintiff. The balance amount of Rs.85,00,000/ - was to be paid on mutation of the property in favour of the sellers.
5. As per the Plaintiff, Sh. Tara Chand had entered into the agreement for himself and as a partner of f irm M/s. Anil Playing Cards Manufacturing Company and assured that he would get the signatures from the other partners. It is contended that since the Defendants failed to execute the necessary papers in favour of the Plaintiff and hand over the possession, the Plaintiff was constrained to file the present suit for specific performance.
IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 3 of 136. The Defendant No.5 Shri Shyam Sunder Khosla has filed an application under Order VII Rule 11 seeking rejection of the plaint on the ground that it fails to show any cause of action against the said Defendant. It is contended that the Agreement to Sell dated 25.11.2007 is not executed by or on behalf of the Defendant No. 5, who is admittedly the owner of 1/4th of the said property. It is contended that the agreement is not enforceable as the same is neither registered nor duly stamped.
7. The Defendant No. 6 has filed IA 17686/2012 under Order VII Rule 11 contending that the firm M/s Jaipur Jewellers of which the Defendant No.6 is a partner is a bonafide purchaser of the entire property comprising of 938 sq. Yards by a duly registered sale deed dated 03.03.2010. The sale deed is stated to have been executed on behalf of the firm M/s. Anil Playing Cards Manufacturing Company through all its partners. It is contended that the alleged agreement is not capable of specific performance as it is not in respect of the correct property as the property measures 938 sq. Yards and the Agreement to Sell is only with respect to 550 sq. Yards. Secondly, it is contended that the owners of IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 4 of 13 the property are not signatories to the agreement and the Defendant No. 5 is not even shown as a party to the agreement though he was admittedly an owner of 1/4 th share of the property.
8. The Supreme Court of India in the case of SOPAN SUKHDEO V. A SSISTANT C HARITY C OMMISSIONER (2004) 3 SCC 137 has laid down that for the purposes of deciding an application under Order 7 Rule 11, the averments made in the plaint are germane and the pleas taken by the Defendant in the written statement would be irrelevant. Further, the court also emphasized that a meaningful and not formal reading of the plaint was to be adopted so as to nip in the bud any clever drafting of the plaint to create an illusion of a cause of action.
9. The court has to see the averments in the plaint to decide whether the suit discloses a triable cause of action. A meaningful and not a formal reading of the plaint has to be adopted to determine whether the plaint discloses a cause of action or a clever drafting methodology has been used to create a semblan ce of a cause of action. Where the Court comes to a conclusion that by adopting a method of clever drafting a IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 5 of 13 semblance of a cause of action is being created, the court has to nip the vexatious and meritless litigation in the bud.
10. The Supreme Court in the case of T. A RIVANDANDAM VS . T.V. SATYAPAL (1977) 4 SCC 467 has laid down as under:-
"5. We have not the slightest hesitation in condemning the petitioner for the gross abuse of the process of the court repeatedly and unrepentently resorted to. From the statement of the facts found in the judgment of the High Court, it is perfectly plain that the suit now pending before the First Munsif's Court, Bangalore, is a flagrant misuse of the mercies of the law in receiving plaints. The learned Munsif must remember that if on a meaningful -- not formal -- reading of the plaint it is manifestly vexatious, and meritless, in the sense of not disclosing a clear right to sue, he should exercise his power under Order 7, Rule 11 CPC taking care to see that the ground mentioned therein is fulfilled. And, if clever drafting has created the illusion of a cause of action, nip it in the bud at the first hearing by examining the party searchingly under Order 10, CPC. An activist Judge is the answer to irresponsible law suits. The trial courts would insist imperatively on examining the party at the IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 6 of 13 first hearing so that bogus litigation can be shot dow n at the earliest stage........"
11. The Supreme Court in the case of T. A RIVANDANDAM ( SUPRA) has laid down that where the suit is a flagr ant misuse of the mercies of the law in receiving a plaint, the court has to give a meaningful reading of the plaint and not a mere formal meaning. Where on a meaningful reading of the plaint it is manifestly vexatious or meritless in the sense of not disc losing a clear right to sue, the Court should exercise its power under Order VII Rule 11 taking care to see that the grounds mentioned therein is fulfilled. If by cleaver drafting illusion of a cause of action is created, the court can nip it in the bud. The Supreme Court further laid down that an activist Judge is the answer to irresponsible law suits.
12. Perusal of the agreement to sell dated 25.11.2007 shows that the Agreement to Sell is between Sh. Tara Chand, Ms. Rita Nair, Sh. Kiran Nair and Smt. Kaushalya Nair on the one side and the Plaintiff on the other. The Property was purchased by Sh. Tara Chand, Sh. Satyapal Nair, Sh. Shyam Sunder Khosla and Sh. Surender Nath Khosla by Sale Deed dated 18.02.1960.
IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 7 of 13out of the four co-owners, the Agreement to Sell is signed only by Sh. Tara Chand and legal heirs of Sh. Satyapal Nair and not the other co-owners.
13. The agreement further states that sellers have agreed to sell 550 sq. Yards out of total measuring approximately 1000 sq. Yards. Though there is a dispute about the total area and the area under the ownership of the executants/sellers but that is not relevant for the present purpose.
14. The advance/earnest money paid is Rs. 25,00,000/-
with seller no. 1 receiving Rs. 12,50,000/- and sellers 2 to 4 jointly receiving Rs. 12,50,000/-. No payment has been shown to have been received by or on behalf of the other two co-owners. Though it is contended that a sum of Rs. 50,000/- was paid by cheque to Shri Shyam Sunder Khosla (Defendant No. 5). But the payment is allegedly made on 21.12.2007 whereas the agreement to sell is dated 25.11.2007.
15. No document has been produced or relied upon to show that Shyam Sunder Khosla ever agreed to sell his share also and if so for what consideration and on what terms and conditions. There is no agreement or receipt IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 8 of 13 executed by Shri Shyam Sunder Khosla. If the Agreement to Sell was also on behalf of Shri Shyam Sunder Khosla then the area shown would have been 3/4th of 938 (i.e. approx 704 square yards) and not 550 out of 1000 square yards . The advance paid to Shri Shyam Sunder Khosla would also have been Rs. 12,50,000/- and not mere 50,000/-.
16. Further, the Notices dated 27.05.2008, 03.02.2010 & 12.04.2010 allegedly sent by the Plaintiff seeking specific performance have been sent only to the executants/sellers and not to Shri Shyam Sunder Khosla, the Defendant No. 5/applicant.
17. The Plaintiff in the plaint claims that Tara Chand and the Defendant 2 to 5 approached him and agreed to sell their share but this is contradicted by the very Agreement to Sell, the specific performance of which is sought. In the agreement, the first part seller described does not include Shyam Sunder Khosla. Even the notices are not issued to Shyam Sunder Khosla. In Para 8 of the plaint, the Plaintiff has contended that the agreement was on behalf of the partnership firm (M/s. Anil Playing Cards Manufacturing Company). This is IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 9 of 13 contradicted from the very agreement as the firm is not described as a seller in the agreement . No notice is sent seeking specific performance to the remaining two partners and the partnership firm and the fourth partner Shri Surender Nath Khosla has not even been impleaded in the suit.
18. The Plaint clearly does not disclose any cause of action against Shri Shyam Sunder Khosla. The application (I.A. No. 2752/2012) filed by the Defendant No. 5 is accordingly allowed. The P laint is rejected as against the Defendant No. 5.
19. With regard to the application filed by the Defendant No. 6(i.e. I.A. No. 17686/2012) is concerned, it is seen that admittedly the Defendant No. 6 has purchased the entire property after the agreement to sell in favour of the Plaintiff.
20. Though the Defendants 1 to 4 have denied the very execution of the agreement to sell and the receipt of money, it is seen that the agreement is alleged ly signed by the predecessor of Defendant No. 1 and by the Defendants 2 to 4. Payment has been made both in cash and by cheque. Receipt has also been executed. Though IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 10 of 13 the receipt of entire payment has been denied, however some payment has been admittedly received. It is contended by the Defendants 1 to 4 that the payment received is not towards the sale consideration but towards a commercial transaction. All these aspects are liable to be considered by the court after a trial and after the parties have been given an opportunity to prove their respective case.
21. Another factor that is relevant is that a Civil Suit No.446/2007 for permanent injunction was filed in the Court of Senior Judge, Delhi by Mr. Shammi Nayyar (Defendant 1(b)) the son of Sh. Tara Chand against the Plaintiff, one Mr. Pramod Mahajan (a tenant in the property), Raman Kumar Nayyar (Defendant 1(a)) the other son of Tara Chand, and Tehsildar seeking an injunction against the Defendant from making an alteration in the revenue records. The suit was settled through the process of mediation and it was agreed that the Mr. Shammi Nayyar (Defendant 1(b) and Shri Raman Kumar Nayyar (Defendant 1(a) both sons of Tara Chand would take 1/3 rd of the 1/4th share of the property directly from the Defendant No. 1 therein (i.e. the Plaintiff herein). The filing of the suit and its IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 11 of 13 compromise prima facie lends credence to the Agreement to Sell in favour of the Plaintiff.
22. The plea of bonafide purchaser for valuable consideration without notice of defect raised by the Defendant No. 6 is an aspect that the court would consider at the final stage after a trial of the suit. Further, the dispute raised about there being a discrepancy between the area of land agreed to be sold and the actual area is also an aspect that w ould be considered at the relevant stage.
23. Clearly, it cannot be held that from the mere reading of the plaint no cause of action is disclosed as against the Defendants 1 to 4 and 6. The application filed by the Defendant No. 6 thus cannot be allowed and the plaint cannot be rejected for failure to show cause of action as against the Defendants 1 to 4 and 6.
24. In view of the above, the application filed by the Defendant No. 5 (i.e. I.A. 2752 of 2012) is allowed and the plaint qua Defendant No. 5 is rejected. The application filed by the Defendant No. 6 (i.e. I.A. 17686 of 2012) is dismissed. No orders as to costs.
IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 12 of 1325. List the matter before the roster bench for directions on 23 rd July, 2014.
SANJEEV SACHDEVA, J July 15, 2014 st IA Nos. 2752/2012 & 17686/2012 in CS(OS) No.2149/2010 Page 13 of 13