Karnataka High Court
M/S Adarsh Developers vs Late Narayan Reddy on 7 June, 2017
Equivalent citations: 2017 (4) AKR 818, (2018) 1 KCCR 570
Author: Aravind Kumar
Bench: Aravind Kumar
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 07TH DAY OF JUNE, 2017
BEFORE
THE HON'BLE MR.JUSTICE ARAVIND KUMAR
W.P. NO.14291/2017
C/W
W.P.NO.37506/2013 (GM-CPC)
IN W.P.NO.14291/2017:
BETWEEN:
M/S ADARSH DEVELOPERS
A PARTNERSHIP FIRM,
#10, VITTAL MALLYA ROAD,
BANGALORE
REPRESENTED BY ITS
MANAGING PARTNER
B M JAYESHANKAR
... PETITIONER
(BY SRI.SRINIVASA RAGHAVAN V, ADVOCATE)
AND:
LATE NARAYAN REDDY
SINCE DEAD REPRESENTED BY
LEGAL REPRESENTATIVES
1. N.RATHI DEVI,
W/O LATE T.NARAYANA REDDY,
AGED ABOUT 64 YEARS,
R/AT 618, 1ST MAIN,
13TH CROSS, DOMLUR
LAYOUT, DOMLUR,
BENGALURU-560 071.
2
2. SUVARNA N
W/O K.C.PRABHAKAR,
AGED ABOUT 55 YEARS,
R/AT OLD NO.61,
NEW NO.34/28,
SEETHARAM PALYA,
MAHADEVPURA POST,
BENGALURU-560 048.
3. N.VIJAYARAGHAVA REDDY
S/O LATE NARAYAN REDDY,
AGED ABOUT 57 YEARS,
R/AT SEETARAMPALYA,
SONNENAHALLI,
MAHADEVAPURA,
BENGALURU-560 048.
4. N.RAVINDRA
S/O LATE NARAYAN REDDY,
AGED ABOUT 60 YEARS,
R/AT SEETARAMPALYA,
SONNENAHALLI,
MAHADEVAPURA,
BENGALURU-560 048.
5. N.RAMESH
S/O LATE NARAYAN REDDY,
AGED ABOUT 54 YEARS,
R/AT SEETARAMPALYA,
SONNENAHALLI,
MAHADEVAPURA,
BENGALURU-560 048.
6. SMT.S.SARALA
W/O VIJAYARAGHAVA REDDY,
AGED ABOUT 51 YEARS,
R/AT SEETARAMPALYA,
SONNENAHALLI,
MAHADEVAPURA,
BENGALURU-560 048.
7. SMT.R.MAMATHA
W/O N.RAVINDRA,
3
AGED ABOUT 50 YEARS,
R/AT SEETARAMPALYA,
SONNENAHALLI,
MAHADEVAPURA,
BENGALURU-560 048.
8. SMT.S.SUDHA
W/O N.RAMESH,
AGED ABOUT 49 YEARS,
R/AT SEETARAMPALYA,
SONNENAHALLI,
MAHADEVAPURA,
BENGALURU-560 048.
... RESPONDENTS
(BY SRI.G L VISHWANATH, ADVOCATE FOR R-1 & 2 &
C/R3-R8)
THIS WRIT PETITION IS FILED UNDER ARTICLE 227
OF THE CONSTITUTION OF INDIA, PRAYING TO SET ASIDE
THE IMPUGNED ORDER DATED 28.3.2017 PASSED BY
THE PRICIPAL SENIOR CIVIL JUDGE, BANGALORE RURAL
IN O.S.NO.855/2012 [ANENXURE-A] AND CONSEQUENTLY
PERMIT THE DEFENDANTS TO LEAD EVIDENCE
THROUGH ITS WITNESSES AS NAMED IN THE LIST OF
WITNESSES.
IN W.P.NO.37506/2013:
BETWEEN:
1. B NARAYAN REDDY
SINCE DEAD REPRESENTED BY
LEGAL REPRESENTATIVES
1(a) N.RATHI DEVI,
W/O LATE T.NARAYANA REDDY,
AGED ABOUT 63 YEARS,
R/AT 618, 1ST MAIN,
13TH CROSS, DOMLUR
LAYOUT, DOMLUR,
BENGALURU-560 071.
4
1(b) SUVARNA N
W/O K.C.PRABHAKAR,
AGED ABOUT 53 YEARS,
R/AT OLD NO.61,
NEW NO.34/28,
SEETHARAM PALYA,
MAHADEVPURA POST,
BENGALURU-560 048.
2. N.VIJAYARAGHAVA REDDY
AGED ABOUT 53 YEARS,
3. N.RAVINDRA
AGED ABOUT 56 YEARS,
4. N.RAMESH
AGED ABOUT 50 YEARS,
5. SMT.S.SARALA
AGED ABOUT 48 YEARS,
6. SMT.R.MAMATHA
AGED ABOUT 47 YEARS,
7. SMT.S.SUDHA
AGED ABOUT 46 YEARS,
(NOS.2 TO 4 BEING THE SONS OF
B. NARAYANA REDDY AND
NOS. 5 TO 7 BEING THE
REPRESENTATIVE WIVES OF
NOS. 2 TO 4)
ALL R/AT SEETARAMPALYA,
SONNENAHALLI,
MAHADEVAPURA POST
BENGALURU-560 048.
... PETITIONERS
(BY SRI.G L VISHWANATH, ADVOCATE)
5
AND:
1. M/S ADARSH DEVELOPERS
BEING A REGISTERED
PARTNERSHIP FIRM,
HAVING ITS REGISTERED OFFICE
AT NO.10, VITTAL MALLYA ROAD,
BANGALORE-560001
REPRESENTED BY ITS
MANAGING PARTNER
2. M/S SALARPURIA PROPERTIES
PVT. LIMITED
4TH FLOOR, SALARPURIA
WINDSOR, NO.3,
ULSOOR ROAD
BANGALORE-560 042.
REP. BY ITS MANAGING DIRECTOR
..RESPONDENTS
(BY SMT. ANUPAMA HEBBAR ON BEHALF OF
M/S INDUS LAW FOR R-1;
SRI SURAJ GOVINDARAJ, ADVOCATE FOR R-2)
THIS WRIT PETITION IS FILED UNDER ARTICLE 227
OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH
THE IMPUGNED ORDER DATED 01.08.2013 PASSED BY I
ADDL. CIVIL JUDGE, SR.DN BANGALORE IN
O.S.NO.855/2012 VIDE ANNEXURE-G.
THESE PETITIONS COMING ON FOR PRELIMINARY
HEARING THIS DAY, THE COURT MADE THE FOLLOWING:
ORDER
These two writ petitions arises out of order passed in O.S.No.855/2012 and as such, they are taken up together for disposal by consent of learned Advocates 6 appearing for parties. Parties are referred to as per rank in the trial Court.
2. Suit O.S.No.855/2012 for specific performance has been filed by first respondent in W.P.No.37506/2013, who is petitioner in W.P.No.14291/2017 seeking following reliefs:
a) Direct the Defendants to specifically perform their obligations arising under the Joint Development Agreements dated 10/06/2004, 28/10/2005 and the Supplementary Agreement dated 28/10/2005 executed in respect of the Suit Schedule 'A' and 'B' properties and to cooperate with the Plaintiffs in fully implementing the said agreements including by executing and registering deeds revoking the revocation of GPAs dated 14/06/2004 and 28/10/2005;
b) Declare that the revocation dated 02/07/2009 of the general power of attorneys dated 14/06/2004, registered as document No. 157/04- 7 05 in the office of Krishnarajapuram Sub-Registrar, Bangalore and 29/10/2005, registered as document No.393/05-06 in the office of Krishnarajapuram Sub-Registrar is illegal and not binding on the Plaintiff;
c) Pass an order of Permanent Injunction restraining the Defendants, their agents or anyone claiming through or under them from in any way impeding or interfering with the full implementation of the Joint Development Agreements dated 10/06/2004, 28/10/2005 and the Supplementary Agreement dated 28/10/2005 and the development of the schedule properties in any manner; and
d) Grants costs of the proceedings;
3. On service of suit summons defendants appeared, filed their written statement, denied the averments made in the plaint except to the extent expressly admitted therein. On the basis of pleadings of 8 the parties trial court framed issues on 18.06.2013 - Annexure-C. During the pendency of proceedings before trial Court plaintiffs filed I.A.No.3 under Order I Rule 10 read with Section 151 CPC to implead:
M/s. Salarpuria Properties Private Limited Sattva Group, 4th Floor, Salarpuria Windsor, No.3, Ulsoor Road, Bangalore-560 042 Rep. by its Managing Partner.
as 8th defendant, contending interalia that applicant who is proposed to be impleaded is necessary and proper party. It was contended that 4th defendant had informed the plaintiff about another development agreement having been entered into by defendants with the proposed 8th defendant in respect of remaining lands measuring 18 acres 7 guntas and 4th defendant had expressed his intention to set up IT/ITES/SEZ jointly in the lands given to plaintiff and proposed 8th defendant and as such said proposal was discussed with proposed 8th defendant and it was mutually agreed to set up IT/ITES/SEZ in the entire lands namely, by clubbing the land given to plaintiff as well as land given 9 to proposed 8th defendant, for which 4th defendant had also consented to take all necessary steps for development of the entire lands and as such, plaintiff had authorised proposed 8th defendant by communication dated 15.04.2006 to take further steps in the matter of filing of necessary application before SEZ Authorities. Hence, contending that proposed 8th defendant was privy to all the discussions and transactions relating to suit schedule properties and order passed in the suit in question would have a bearing on the proposed 8th defendant's claim and as such, it was contended by plaintiff that proposed defendant is a necessary and proper party to the suit.
This application came to be resisted by the defendants by filing detailed statement of objections, Annexure-F. Said application came to be adjudicated by the trial Court under the impugned order dated 01.08.2013 and was allowed by impugned order opining that for effective adjudication of matters in dispute and considering subsequent transactions between parties having taken 10 place, presence of proposed defendant is required and accordingly, application in question came to be allowed.
4. Sub-rule (2) of Rule (10) of Order I of CPC empowers the Court at any stage of the proceedings, either upon or without an application of either party, to join or strike off the name of such persons, whether as plaintiff or defendant, as may be necessary, in order to enable such Court to effectually and completely adjudicate and settle all the questions involved in the suit. Question of addition of a party under Rule (10) of Order I CPC is one of judicial discretion, which has to be exercised in the facts and circumstances of each case that may be obtained. There cannot be any straight jacket formula in this regard. A person may be added as a party to the proceedings, either as plaintiff or defendant, wherein he/she ought to have been joined as a party has not been added or when his/her presence is necessary in order to dispose of the suit completely and effectively and expression "ought to have been joined"
as found in sub-rule (2) of Rule (10) of Order 1 CPC 11 apparently refers to necessary parties in the sense that such suit cannot be effectively disposed of without their presence on record. To put it differently, a necessary party is one in whose absence the Court cannot pass an effective decree at all. Proper party is one whose presence before the Court would be necessary to ensure that all matters in dispute are effectually and completely determined. The only reason which makes it necessary to make a person as a party to the action is, he should be bound by ensuing results and all questions arising between parties could be settled in that suit. Therefore, it must be construed that a dispute, which cannot be effectively settled unless he/she is a party, would be a necessary party. To put it differently, presence of party would be necessary to advance the cause of justice.
5. Learned Advocates appearing for parties namely, Sri.Srinivasa Raghavan V., learned counsel appearing for plaintiff and Sri.G.L.Vishwanath, learned counsel appearing for defendants have extensively argued and have brought to the notice of the Court, 12 pleadings which came to be laid before the trial Court to buttress their respective arguments by contending that proposed 8th defendant is a necessary party or is not a necessary party for effectively deciding the suit in question.
6. Thus, short point that arises for consideration in this writ petition is: Whether proposed 8th defendant is necessary and proper party to the suit in question? Plaint averments would disclose that plaintiff has sought for the relief of specific performance of agreement of Joint Development Agreements dated 10.06.2004 and 28.10.2005 and the Supplementary Agreement dated 28.10.2005 in respect of 'A' and 'B' suit schedule lands. They have also sought for declaring the revocation dated 02.07.2009 of General Power of Attorneys dated 14.06.2004 and 29.10.2005 is illegal and not binding on them amongst other prayers as already extracted hereinabove.
7. In a suit for specific performance it is needless to state that only parties to the contract would 13 be necessary party. However, parties claiming under them or a person who had purchased the contracted property from the vendor with or without notice and who claims to have an independent title and possession adverse to the title of vendor, would not be a necessary or a proper party as held by catena of judgments.
8. In the case of KASTURI vs. IYYAMPERUMAL AND OTHERS reported in (2005) 6 SCC 733 it has been held that two facts are required to be satisfied to determine who is a necessary party. It has been held guiding principle is that presence of such a party is necessary to adjudicate the controversies involved in the suit for specific performance of contract for sale, since enforceability of the contract entered into between parties to the contract would be the question which requires to be decided or adjudicated. It has been held that a person claiming title over the property in question, if sought to be impleaded either on an application filed by such applicant (title holder) or at the behest of the parties to the suit, it would enlarge the 14 scope of such suit. In this background, it came to be held:
"11. As noted hereinearlier, two test are required to be satisfied to determine the question who is a necessary party, let us now consider who is a proper party in a suit for specific performance of a contract for sale. For deciding the question who is a proper party in a suit for specific performance the guiding principle is that the presence of such a party is necessary and to adjudicate the controversies involved in the suit for specific performance of he contract for sale. Thus, question is to be decided keeping in mind the scope of the suit. The question that is to be decided in a suit for specific performance of the contract for sale is to the enforceability of the contract entered into between the parties to the contract. If the person seeking addition is added in such a suit, the scope of the suit for specific performance would be enlarged and it would be practically converted into a suit for title. Therefore, for effective adjudication of the controversies involved in the suit, presence of such parties cannot be said to be necessary at all. Lord Chancellor Cottenham in Tasker v. Small made the following observations: (ER pp. 850-51) "It is not disputed that, generally, to a bill for a specific performance of a 15 contract of sale, the parties to the contract only are the proper parties; and, when the ground of the jurisdiction of Courts of Equity in suits of that kind is considered it could not properly be otherwise. The Court assumes jurisdiction in such cases, because a court of law, giving damages only for the non-performance of the contract, in many cases does not afford an adequate remedy. But, in equity, as well as at law, the contract constitutes the right, and regulates the liabilities of the parties; and the object of both proceedings is to place the party complaining as nearly as possible in the same situation as the defendant had agreed that he should be placed in. It is obvious that persons, strangers to the contract, and, therefore, neither entitled to the right, nor subject to the liabilities which arise out of it, are as much strangers to a proceeding to enforce the execution of it as they are to a proceeding to recover damages for the breach of it."
13. From the aforesaid discussion, it is pellucid that necessary parties are those persons in whose absence no decree can be passed by the court or that there must be a right to some 16 relief against some party in respect of the controversy involved in the proceedings and proper parties are those whose presence before the court would be necessary in order to enable the court effectually and completely to adjudicate upon and settle all the questions involved in the suit although no relief in the suit was claimed against such person."
9. In a suit for specific performance, where there is interse dispute between defendant and a third party or plaintiff and third party or plaintiff, defendant and third party, if such third party is sought to be impleaded or brought on record, it would result in enlarging the scope of the suit. Such interse controversies between the parties even if existing would not be in the realm of said suit, inasmuch as, Court adjudicating the dispute would ultimately grant the prayer that has been sought for in the suit for granting or rejecting the relief. Such controversies which may arise interse between plaintiff and a third party or defendant and a third party, would not be in the domain of said suit. However, that does not preclude either of the parties to substantiate their respective pleadings 17 and prove the issues, if necessary by summoning such of those persons as witnesses, whom they intend to examine to discharge their burden. Dicta laid down in the case of KASTURI vs. IYYAMPERUMAL AND OTHERS by the Apex Court referred to herein supra came up for consideration in subsequent judgment in the matter of THOMSON PRESS (INDIA) LTD. vs. NANAK BUILDERS AND INVESTORS P. LTD. AND ORS. reported in AIR 2013 SC 2389 Apex Court was examining as to whether a purchaser pendente-lite with knowledge of earlier agreement can be added as a party in a suit for specific performance or not. In the facts obtained in the said case, it came to be held that transferee pendente-lite cannot be permitted to come on record under Order I Rule 10 CPC, but under Order XXII Rule 10 CPC such person/s can be brought or impleaded in cases of assignment, creation or devolution of any interest during the pendency of the suit, by the leave of such Court and it may be continued by or against the person whom or upon it has come or devolved. In this background, Apex Court in THOMAS 18 PRESS's case allowed the impleading applicant to come on record, since he claimed to have purchased the property, which was the subject matter of suit for specific performance during the pendency of the proceedings.
10. Keeping these principles in mind when the facts on hand are examined it would clearly disclose that plaintiff herein had filed a suit for specific performance against defendants in respect of two joint development agreements namely 10.06.2004 and 28.10.2005 and supplementary agreement dated 28.10.2005 by seeking enforcement of these agreements against defendants. It had been the grievance of plaintiff that during the currency of said agreements defendant had also entered into similar joint development agreements with proposed 8th defendant in respect of remaining land (land other than suit schedule property) and there was discussion amongst them to combine both the properties so as to form IT/ITES/SEZ, which would benefit all the parties. Hence, it was contended 19 that plaintiff had authorised proposed 8th defendant to take further steps in the matter of filing necessary applications before SEZ authorities and as such, proposed defendant had taken steps. It was also contended by the plaintiff that project is conceived under Joint Development Agreements on account of defendants requesting for setting up SEZ in the land given to them (plaintiff) jointly with proposed 8th defendant. Hence, plaintiff contended that any decision that would be rendered in this suit i.e., O.S.No.855/2012 would have a bearing or impact in respect of the land, which is also the subject matter of joint development agreement executed by defendants in favour of proposed 8th defendant and as such, proposed defendant is a necessary party to the suit. It is not the case of plaintiff that relief which may be granted by the trial Court in the suit in question or refusal of such prayer sought for in the suit, would adversely affect proposed 8th defendant. Merely because proposed 8th defendant had also entered into a joint development agreement with proposed defendant to an extent of 18 20 acres 7 guntas land, which is abutting and adjoining the suit property and which undisputedly is not the subject matter of present suit in question, plaintiff cannot be heard to contend that proposed 8th defendant would be necessary and proper party.
11. At this juncture itself it would be apt and necessary to examine contention of Sri.Srinivasa Raghavan, learned counsel appearing for petitioner/ plaintiff who has contended that plaintiff being dominus litis has a right to choose the person whom plaintiff proposes to implead as party to the suit. There cannot be any dispute to the said proposition at all. However, under the guise of plaintiff being dominus litis, plaintiff cannot be heard to contend that parties who are neither necessary nor proper parties would also be required to be impleaded in a suit for specific performance or on account of any interse dispute or agreement between proposed defendant and plaintiff - defendants in the said suit, is also required to be resolved and thereby expanding the scope of suit in question. A necessary 21 party is the person who ought to be joined as a party to the suit in whose absence effective decree cannot be passed by the Court. A proper person is a person whose presence would enable the Court to completely, effectively and properly adjudicate upon all matters and issues, though he may not be a person in favour of or against whom a decree is to be made. In a suit for specific performance, as held by the Hon'ble Apex Court in THOMAS PRESS's case a purchaser pendente lite, who has acquired right, title and interest in respect of disputed property has been held as having acquired title or in other words, there is devolution of interest in favour of such purchaser and as such, under Order XXII Rule 10 CPC such subsequent purchaser has been ordered to be impleaded, inasmuch as, decree that may be passed in such suit, otherwise would not be effectively enforceable, in the light of such third party having acquired title to the property. In the instant case, plaintiff has alleged that proposed 8th defendant has also entered into a joint development agreement with defendants and as such, plaintiff, defendants and 22 proposed defendant had resolved to form IT/ITES/SEZ not only in the property which is the subject matter of present suit, but also in respect of property belonging to proposed 8th defendant and as such, it was contended that proposed 8th defendant is to be impleaded in the suit. It is not in dispute that proposed 8th defendant has assigned its right under the joint development agreement in favour of third party. Thus, even assuming for a moment that there was any semblance of right in respect of joint development agreement which 8th defendant had entered into with defendants 1 to 7, said right has evaporated into thin air by virtue of such agreement. In other words, there being no subsisting interest with proposed 8th defendant in respect of such joint development agreement, question of impleading the applicant as 8th defendant would not serve any fruitful purpose. As such, this Court is of the considered view that trial Court was not justified in allowing the application for impleading by permitting the proposed defendant to be added as a party namely, as 8th defendant, since it is neither a necessary nor a proper 23 party. However, it would be open for the plaintiff to choose its witnesses to prove the issues, the burden of which has been cast on plaintiff and a bare look at the issues framed - Annexure-C, does not even remotely suggest about proposed 8th defendant's claim involved in the suit being the subject matter of adjudication.
12. For the myriad reasons aforestated, this Court is of the considered view that impugned order dated 01.08.2013 - Annexure-G cannot be sustained. RE. W.P.NO.14291/2017:
13. This writ petition has been filed by the plaintiff in the suit O.S.No.855/2012 being aggrieved by the order dated 28.03.2017 whereunder plaintiff had proposed to examine three witnesses namely, Vice- President, Managing Director and Engineering Consultant of the proposed defendant - M/s. Salarpuria Properties Pvt. Ltd. and Civil Engineering Consultant, Bangalore, as its witnesses, which was objected to by the learned counsel for defendants on the ground that they are the employees of M/s. Salarpuria Properties 24 Pvt. Ltd. and contending interalia that order passed on the impleading application permitting the impleading of M/s. Salarpuria Properties Pvt. Ltd. as 8th defendant in the suit, is under challenge before this Court in W.P.No.37506/2013 and said order of allowing the impleading application had been stayed. Taking note of this fact trial court has not permitted the plaintiff to examine the witnesses as proposed by the plaintiff in its list of witnesses.
14. As could be seen from the impugned order dated 28.03.2017 - Annexure-A, only ground on which plaintiff has been prevented from examining the witnesses is on account of pendency of W.P.No.37506/2013 and order of stay having been passed by this Court staying the application filed under Order I Rule 10(2) CPC having been allowed by the trial Court. There being no consideration with regard to merits of rival contentions this Court is of the considered view that parties can be relegated to trial Court in view of W.P.No.37506/2013 having been 25 disposed of today. In that view of the matter, impugned order dated 28.03.2017 - Annexure-A is to be set aside by remanding the matter back to trial Court with a direction to trial Court to examine the claim of parties on merits. However, it is made clear that no opinion is expressed in that regard and contentions of both parties are kept open.
15. For the reasons aforestated, I proceed to pass the following:
ORDER
(i) Writ Petition No.37506/2013 is hereby allowed and order dated 01.08.2013 -
Annexure-G passed by I Addl. Civil Judge (Sr.Dn.), Bangalore, in O.S.No.855/2012 allowing I.A.No.III is hereby set aside.
(ii) I.A.No.III - Annexure-F filed under Order I Rule 10 (2) CPC by plaintiff is hereby dismissed.
26
(iii) Writ Petition No.14291/2017 is hereby allowed and order dated 28.03.2017 -
Annexure-A passed by Principal Senior Civil Judge, Bangalore Rural District, Bangalore, in O.S.No.855/2012 is hereby set aside and matter is remitted back to trial Court for examining the claim of plaintiff for permitting the plaintiff to examine the witnesses as per the list - Annexure-H.
(iv) Trial Court shall expeditiously dispose of the suit subject to both the parties cooperating with trial Court.
SD/-
JUDGE DR