Gujarat High Court
Jagatsinh Mahipatsinh Jadeja vs Nishi Alex Lusich on 7 April, 2025
Author: Sangeeta K. Vishen
Bench: Sangeeta K. Vishen
NEUTRAL CITATION
C/FA/2130/2024 ORDER DATED: 07/04/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 2130 of 2024
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2024
In R/FIRST APPEAL NO. 2130 of 2024
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JAGATSINH MAHIPATSINH JADEJA
Versus
NISHI ALEX LUSICH & ANR.
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Appearance:
MR VIMAL PATEL FOR VMP LEGAL(7210) for the Appellant(s) No. 1
MR VIMAL A PUROHIT(5049) for the Defendant(s) No. 1
MR. NISHIT P GANDHI(6946) for the Defendant(s) No. 2
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CORAM:HONOURABLE MS. JUSTICE SANGEETA K. VISHEN
and
HONOURABLE MR. JUSTICE NIRAL R. MEHTA
Date : 07/04/2025
ORAL ORDER
(PER : HONOURABLE MR. JUSTICE NIRAL R. MEHTA) Since the issue lies in a very narrow compass, at the request of the learned advocates for the respective parties, the present appeal is taken up for final hearing at the admission stage.
2. The captioned First Appeal under Section 96 of the Code of Civil Procedure, 1908 (for short 'the Code'), at the instance of original plaintiff, is directed against the order dated 09th April, 2024 passed by the learned Additional Senior Civil Judge, Gondal whereby, the plaint of the Special Civil Suit No.23 of 2023 instituted by the appellant - original plaintiff for specific performance of the oral agreement and permanent injunction as well as alternatively, seeking recovery of an amount of Rs.2,75,51,000/- with interest and Page 1 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined damages for amount of Rs.51,00,000/-, came to be rejected under Order VII Rule 11 of the Code.
3. The facts as per the appellant - plaintiff can briefly be stated as under.
3.1 The plaintiff and the original defendant No.2 entered into an oral agreement for sale of non-agricultural land bearing Revenue Survey No.51 admeasuring 5 Acres and 10 Gunthas (23,357.48 sq.mtrs.) and internal road admeasuring 888.58 sq.mtrs. aggregating to 21,246.06 sq.mtrs. situated at village Ribda, Taluka - Gondal, District - Rajkot at the rate of Rs.1,44,00,000/- per Acre.
3.2 It is the case of the plaintiff that an amount of Rs.1,75,51,000/- was paid on 18 th April, 2022 to original defendant No.1. The Sauda Chitthi dated 18 th April, 2022 signed by original defendant No.1 acknowledging the receipt of the said amount as well as the rate of Rs.1,44,00,000/- per Acre. The appellant - plaintiff thereafter paid further amount of Rs.1,00,00,000/- towards consideration on 10 th August, 2022 to the original defendant No.1. Thus, the appellant - plaintiff paid total sum of Rs.2,75,51,000/- to the original defendant No.1.
3.3 It is the case of the plaintiff that the public notice dated 19th April, 2023 in the daily local newspaper 'Akila' for sale of the suit land was published by the original defendant No.1. In response thereto, the appellant - plaintiff gave counter public notice dated 27 th April, 2023 in the daily local Page 2 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined newspaper "Akila' disclosing ongoing deal of the land in question.
3.4 The appellant - plaintiff thereafter was constrained to institute the Special Civil Suit No.23 of 2023 before the trial court for the reliefs prayed therein. In response thereto, the respondent No.1 gave an application Exh.8 dated 23 rd March, 2023 under Order VII Rule 11 of the Code praying, inter alia, to reject the plaint on the ground that the oral agreement entered into between the parties was cancelled and the amount paid by the appellant was returned by the respondent No.1. The said application was resisted by the plaintiff by way of reply dated 09th November, 2023 at Exh.11.
3.5 During the pendency of the suit proceedings, the respondent No.1 sold the suit land to the respondent No.2 by way of sale deed dated 21 st November, 2023. The plaintiff, therefore, submitted an application Exh.13 dated 02 nd December, 2023 to join the respondent as party defendant in the said suit. The said application was opposed by the respondent No.1 by way of reply dated 09 th January, 2024 at Exh.16. The said application was, however, allowed by the trial court by an order dated 27 th February, 2024 and the respondent No.2 came to be joined as party original defendant No.2.
3.6 Thereafter, the trial court vide order dated 09 th April, 2024 allowed the application Exh.8 under Order VII Rule 11 of the Code, rejecting the plaint of Special Civil Suit No.23 of 2023. Being aggrieved and dissatisfied by the Page 3 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined aforesaid, the appellant - plaintiff has approached this Court by way of captioned appeal.
4. Heard Mr.Vimal Patel learned advocate for the appellant, Mr.Vimal Purohit learned advocate for the defendant No.1 and Mr.Nishit Gandhi learned advocate for the respondent No.2.
5. Mr.Vimal Patel learned advocate for the appellant, while challenging the impugned order, has made the following submissions :
(1) Mr.Vimal Patel learned advocate has vehemently submitted that the trial court, while deciding an application under Order VII Rule 11 of the Code, has virtually decided the suit on merits by holding that the agreement at Mark 3/1 does not fall within the definition of 'agreement' and is not legally enforceable under the Indian Contract Act. Mr.Patel, therefore, submitted that it is an error committed by the trial court to enter into arena of merits while deciding the application under Order VII Rule 11 of the Code. Mr.Patel, thus, submitted that the trial court has not only exceeded his jurisdiction but also acted contrary to the scope and ambit of Order VII Rule 11 of the Code, the impugned order thereby is required to be quashed and set aside.
(2) Mr.Patel learned advocate submitted that the trial court has committed a serious error in holding that the documents which are relied upon by the plaintiff is of deficient in stamp and thereby, the said document cannot be considered in the Page 4 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined suit for specific performance. Mr.Patel submitted that finding and observation rendered by the trial court is in the nature of merit and the same cannot be gone into at the stage of Order VII Rule 11 and thus, the impugned order thereby deserves to be quashed and set aside.
(3) Mr.Patel further submitted that the land in question is a non-agricultural land purchased by the defendant No.2 herein during the pendency of the suit only with a view to frustrating the rights of the appellant - plaintiff. Mr.Patel further submitted that plaintiff has paid sizable amount to the defendant No.1 and thereby the plaintiff has right to get the sale deed in his favour and/or recovery of money paid and/or damages from the defendant No.1. Under these circumstances, according to learned advocate, if the plaint is rejected at the stage of Order VII Rule 11 of the Code, that too by going into the merits of the case, the same would be prejudicial to the plaintiff. Mr.Patel thus requested this Court to quash and set aside the impugned order.
(4) Mr.Patel submitted that at the stage of Order VII Rule 11, only the averments of the plaint and the documents attached therewith are open to scrutiny. Learned advocate, therefore, submitted that in the plaint, the appellant - plaintiff has made out a case with assertion for seeking prayers as prayed for in the plaint. Under the circumstances, Mr.Patel submitted that the learned trial court ought not to have gone into the merits and de-merits of the case and further, ought not to have rejected the plaint at the so nascent stage by exercising powers under Order VII Rule 11 of the Code.Page 5 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025
NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined (5) Mr.Patel has placed reliance on the decision of the Apex Court in the case of Maharaj Singh v. Karan Singh (Dead) Thr. Lrs. reported in (2024) 8 SCC 83 contending that in a suit of performance of contract between the vendor and the plaintiff, in absence of any challenge to the sale deed in favour of subsequent purchaser, the Court can direct the subsequent transferee - purchaser to join in the conveyance so as to pass on the title.
5.1 By making above submissions, Mr.Patel learned advocate has prayed to grant interim relief during the pendency of the present appeal.
6. Per contra, Mr.Nishit Gandhi learned advocate for the defendant No.2, while supporting the impugned order, has made the following submissions :
(1) Mr.Gandhi learned advocate for the defendant No.2 -
subsequent purchaser vehemently submitted that in the plaint, the cancellation of the sale deed of the defendant No.2 has not been prayed. Thus, in absence of any challenge to the registered sale deed, the performance cannot be granted and thus, the suit cannot be permitted to continue. Accordingly, Mr.Gandhi submitted that the trial court has rightly rejected the plaint under O.VII Rule 11 of the Code.
(2) Mr.Gandhi further submitted that the transaction between the plaintiff and the defendant No.1 can be said to be wholly in cash and thereby, such huge cash transaction cannot be taken into consideration in the suit for specific Page 6 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined performance, more particularly when it is the case of the defendant No.1 that the said cash has already been returned to the plaintiff.
(3) To substantiate the aforesaid contention, Mr.Gandhi has placed reliance on the decision of the Apex Court in the case of G. Pankajakshiamma v. Mathai Mathew (Dead) Through Lrs. reported in (2004) 12 SCC 83. Relying upon the said decision, learned advocate further submitted that the amount paid in cash are said to be illegal transaction and no court can come to the aid of a party in an illegal transaction.
6.1 By making above submissions, Mr.Gandhi urged this Court to dismiss the captioned Appeal.
7. Mr.Vimal Purohit learned advocate for original defendant No.1, while adopting the arguments of learned advocate Mr.Nishit Gandhi for defendant No.2, has made the following submissions.
(1) Learned advocate has more or less maintain the stand that was taken by way of application under Order VII Rule 11 filed at Exh.8. Mr.Purohit reiterated that the amount stated to have been paid to the extent of R.1,75,51,000/- on 18 th April, 2022 and Rs.1,00,00,000/- on 10 th August, 2022 has already been repaid to the plaintiff on 04th April, 2023 in presence of one Gobarbhai Khodabhai and one Manvendrasinh Jadeja. Learned advocate further submitted that despite the said amount was repaid, the plaintiff, with a mala fide intention, instituted the suit. Learned advocate, therefore, submitted Page 7 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined that the learned trial court was perfectly justified in exercising its jurisdiction under Order VII Rule 11 of the Code. Thereby, he requested this Court to dismiss the appeal in limine.
7.1 By making above submissions, learned advocate Mr.Purohit requested this Court to dismiss the captioned Appeal.
8. We have heard the learned advocates appearing for the respective parties and have gone through the material produced on record. No other and/or further submissions have been made by the learned advocates appearing for the respective parties except what are stated hereinabove.
9. Considering the submissions of learned advocates for the respective parties as well as the documents produced on record, the short question that falls for consideration of this Court is whether the learned trial court was legally justified in rejecting the plaint under Order VII Rule 11 of the Code?
10. So as to decide the aforesaid question, in our view, we should be mindful with respect to the settled proposition of law with regard to the provisions of Order VII Rule 11 of the Code. It is, by now, well settled proposition of law that provisions of Order VII Rule 11 is an independent and special remedy wherein the court is empowered to summarily dismiss a suit at the threshold without proceeding to record evidence and conducting the trial, on the basis of evidence adduced, if Page 8 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined it is satisfied that the action should be terminated on any grounds contained in the provisions. The underlying object of Order VII Rule 11 is that if in a suit, no cause of action is disclosed or the suit is barred by any law, the Court would not permit the plaintiff to unnecessarily protract the proceedings in the suit. The louder object of the provisions of Order VII Rule 11 is to give quietus to the sham litigation at the earliest so that judicial time is not wasted. However, it is also settled proposition of law that while deciding an application under Order VII Rule 11 of the Code, the Court shall only consider the averments made in the plaint as a whole and the documents attached with the plaint. The defence of the defendant cannot be gone into at the stage of deciding application under Order VII Rule 11. The Apex Court in catena of decisions held that powers conferred by virtue of the provisions of Order VII Rule 11 are drastic in nature and therefore, the same deserves to be exercised very cautiously and sparingly. The Apex Court has also clarified in many of its decisions that while deciding an application under Order VII Rule 11, the Courts cannot consider disputed questions of fact.
11. Keeping in mind the aforesaid basic contours of provisions of Order VII Rule 11 of the Code, proper course is first to read the plaint as a whole believing it to be true and upon such reading, if the plaint discloses cause of action, then the application under Order VII Rule 11 must fail.
12. Thus, we will now consider the averments made in the plaint. The relevant portion of the plaint in free English translation would read as under.
(3) The defendant herein had agreed to sell his property situated at non-agricultural land with construction Page 9 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined permission for residential purpose admeasuring about 20357.48 Sq. Mts. and land admeasuring about 888.58 Sq. Mts. for internal roads absolute rights and titles, aggregating to 21246.06 Sq. Mts. being Acre 5 - 10 Gunthas of Revenue Survey No.51 of Village: Ribda of Taluka: Gondal of District: Rajkot of the State of Gujarat, to the plaintiff herein for total consideration of Rs.7,56,00,000/- for aforesaid Acre 5 - 25 Gunthas calculating at the rate of Rs.1,44,00,000/- per acre.
(4) The defendant herein had entered into oral agreement with the plaintiff herein for the above-mentioned property and the plaintiff had paid the amount of Rs.1,75,51,000/- towards part sale consideration of the aforesaid property to the defendants herein on 18/04/2022 and the defendant has acknowledged the receipt thereof. Copy thereof is enclosed herein with separate documentary evidence list.
(5) As per the condition of the oral agreement, the plaintiff has paid the amount of Rs.1,00,00,000/- in words Rupees One Crore only to the defendants herein towards part consideration of the property to be sold through Lalbapu and the defendants herein have signed the acknowledgment receipt thereof. Copy thereof is enclosed herein with separate documentary evidence list.
(6) As per the condition of the oral agreement, it was agreed upon between the plaintiff and defendants herein that the plaintiff shall pay the total amount of sale consideration to the defendants herein for the property in question to be sold by the defendants within one and half year and the defendants shall execute final registered sale deed of the said property in favour of the plaintiff herein, however, as the trustworthy and reputed persons being Lalbapu and Gobarbhai Bhikhabhai Patel from Rajkot were involved in the said deal, the plaintiff trusted the defendants and paid the amount and had not executed Agreement for Sale.
(7) As per the condition of the oral agreement between the plaintiff and defendants herein for the said property, the time-limit for execution of Sale Deed of the said property is not over, however, due to recent increase in the market price of the said property; though the defendants herein have obtain a big amount as a part of sale consideration from the plaintiff herein, they are attempting to sell the same to the third parties and accordingly, sale notice of the same has been published through Advocate Mr. Bhavesh D. Rangani in the daily newspaper 'Akila' on 19/04/2023. Against the said notice, I have published an explanation in the daily Page 10 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined newspaper 'Akila' on 27/04/2023. Copy thereof is enclosed herein with separate documentary evidence list.
(8) The plaintiff was always ready and he is still ready to act in accordance with the conditions of the agreement. The plaintiff informed the defendants that the plaintiff was willing and is still willing to perform his duties and liabilities pursuant to the said agreement. The plaintiff is still ready and willing to perform all the duties and liabilities of the said agreement. The defendants know about such type of readiness and willingness of the plaintiff.
(9) The plaintiff has verbally informed the defendants that the plaintiff is ready for specific performance of the agreement, despite that, the defendants are not responding and do not show willingness to execute final registered sale deed of the said property by accepting remaining consideration and as they are attempting to sell the property in question to the third party, this suit is required to be instituted.
(10) Cause of Action for this Suit: Though the defendants herein have sold the aforesaid property to the plaintiff herein, in collusion with the third parties, they do not act in accordance with the agreement and as they have usurped a big amount of sale consideration from the plaintiff, they have caused a huge financial loss to the plaintiff and as they have published the sale notice in the daily newspaper 'Akila' on 19/04/2023 in order to sell the said property to the third party, the cause of action to institute the present suit has been arisen.
13. Upon careful consideration of the averments made in the plaint, the plaintiff appears to have made assertive pleading that there was oral agreement to sell for the land in question, for which total sale consideration was fixed at Rs.7,56,00,000/-. It has been further averred that a sum of Rs.1,75,51,000/- was paid on 18 th April, 2022 and receipt thereof is issued by the defendant No.1. Further sum of Rs.1,00,00,000/- was paid on 10 th August, 2022 and the receipt thereof also is issued by defendant No.1. So far as the cause of action is concerned, it is a clear averment in the plaint that the defendant published a public notice dated 19 th Page 11 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined April, 2023 in Akila Daily Newspaper and as against that, plaintiff also got published public notice dated 27 th April, 2023 in Akila Daily Newspaper.
13.1 At this stage, it is also necessary to keep in mind the following prayers of the plaint. Free English translation would be thus:
a) The plaintiff herein has purchased the property situated at non-agricultural land with construction permission for residential purpose admeasuring about 20357.48 Sq. Mts. and land admeasuring about 888.58 Sq. Mts. for internal roads absolute rights and titles, aggregating to 21246.06 Sq. Mts.
being Acre 5 - 10 Gunthas of Revenue Survey No.51 of Village: Ribda of Taluka: Gondal of District: Rajkot of the State of Gujarat, from the defendants. Kindly pass the order and decree in favour of the plaintiff that complying the oral agreement thereof, the defendants shall execute final sale deed and hand over the possession of the said property in favour of the plaintiff.
b) Kindly pass permanent injunction order that the defendants herein shall not transfer or assign the property situated at non-agricultural land with construction permission for residential purpose admeasuring about 20357.48 Sq. Mts. and land admeasuring about 888.58 Sq. Mts. for internal roads absolute rights and titles, aggregating to 21246.06 Sq. Mts. being Acre 5 - 10 Gunthas of Revenue Survey No.51 of Village: Ribda of Taluka:
Gondal of District: Rajkot of the State of Gujarat by way of sale, mortgage, gift, lien or otherwise. Moreover, kindly pass the injunction order till disposal of this suit.
c) In alternate, in any case the Hon'ble Court may not allow the specific performance of the contract from the defendants in favour of the plaintiff, kindly grant the refund of the amount of Rs.2,75,51,000/- paid by the plaintiff to the defendants herein with the interest at the rate of 24% thereon and also grant the recovery of Rs.51,00,000/- towards damage thereof from the defendants themselves as well as from all their properties. (This relief is sought as an Page 12 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined alternate option only if the aforesaid relief is not granted i.e. we do not waive the original relief of specific performance of the contract.)
d) Kindly grant all other reliefs that can be granted in this suit.
e) Kindly grant the entire cost of this suit.
13.2 Keeping in mind the prayers of the plaint, the suit filed by the plaintiff is for specific performance and for alternatively, for recovery of amount of Rs.2,75,51,000/- with 24% interest as well as a sum of Rs.51,00,000/- towards damages.
14. Now, in the aforesaid conspectus, we would like to consider the legality of the approach adopted by the learned trial court while deciding the application under Order VII Rule
11. On careful consideration of the impugned judgment as well as the application Exh.8 under Order VII Rule 11, in our considered opinion, learned trial court has committed serious error. We say so because the learned trial court has placed much reliance on the documents at Mark 3/1 and 3/2. The learned trial court has held that the suit based on the aforesaid documents is not falling within the 'definition of agreement' of the Indian Contract Act, 1872. The trial court further held that on the said documents, there is no revenue stamp and thereby the said documents cannot be legally enforced. The approach of the learned trial court, in our considered opinion, is wholly unjustifiable and beyond the scope and ambit of order VII Rule 11 of the Code. It is a trite law that while deciding the application under Order VII Rule 11, only and only averments made in the plaint are to be seen. Although it is permissible to consider the documents attached Page 13 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined with the plaint, but in any case, in our view; admissibility and/ or enforceability of the said documents could not have been gone into. The said aspect is a matter of full-fledged trial. The learned trial court, under the garb of Order VII Rule 11, cannot prejudge merits of the case by considering legality and validity of the document.
15. At this juncture, it would be apt to take note of the decision in case of Geetha D/o.Late Krishna v. Nanjundaswamy reported in 2023 SCC Online SC 1407, wherein the Apex Court has held thus as under.
"11. The High Court committed an error by examining the merits of the matter. It pre-judged the truth, legality and validity of the sale deed under which the Defendants No. 4 to 14 claim title. This is not to say that the Plaintiffs have any less burden to prove their case or even that their case is probable. Simply put, the High Court could not have anticipated the truth of the averments by assuming that the alleged previous sale of the property is complete or that it has been acted upon. The approach adopted by the High Court is incorrect and contrary to the well-entrenched principles of considering an application under Order VII Rule 11, CPC. Under these circumstances, we set aside the judgment and the order passed by the High Court and dismiss the application under Order VII Rule 11, CPC, and restore the suit even with respect to properties mentioned under Schedule A of the Plaint."
16. There is yet another reason why the order of the trial court is not sustainable. Considering the prayers that are made in the plaint, there is a substantive alternative prayer of seeking recovery of amount paid with interest and damages. Thus, assuming that the performance on the basis of so-called unenforceable documents is not possible, in that event also, prayer for recovery of amount paid along with damages still would be available for the plaintiff. Pertinently, in an Page 14 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined application under Order VII Rule 11, it is admitted by the defendant No.1 that amount so received towards the part sale consideration was repaid. In that event, the entire cash transaction is admitted by the defendant No.1 and therefore, whether it was repaid or not is a question of trial so as to grant alternative prayer. Thus, in our considered opinion, the learned trial court has committed serious error in rejecting the plaint.
16.1 So far as the decision relied upon by learned advocate Mr.Gandhi in case of G. Pankajakshiamma (supra) is concerned, in our considered opinion, the same can be made applicable in case during the course of trial if the very transaction is proved to be unaccounted. At the stage of Order VII Rule 11 of the Code, averments made in the plaint are to be accepted as true which is supposed to be proved in the trial. Thus, at the stage of Order VII Rule 11 of the CPC, it would not be proper to hold that cash transaction is unaccounted transaction per se. So far as the main contention of learned advocate Mr.Gandhi is concerned, decision of the Apex Court in case of Maharaj Singh (supra) would squarely cover wherein the Apex Court has, in no uncertain terms, held that decree of performance can be passed directing the subsequent transferee to join the conveyance so as to pass on the title. The relevant observations of the said decision are reproduced herein.
"QUESTIONS FOR CONSIDERATION Page 15 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined
10. After having considered the submissions of the learned counsel appearing for the appellants, we find that the following questions arise:
(a) xxx xxx xxx
(b) xxx xxx xxx
(c) (a) xxx xxx xxx
d) Whether, in view of the decision of this Court in the case of B. Vijaya Bharathi3, the plaintiffs are not entitled to a decree of specific performance in the absence of any prayer for cancellation of the two subsequent sale deeds?
(e) xxx xxx xxx
(f) xxx xxx xxx
ON QUESTION (d)
14. Now, we deal with another argument that the plaintiffs ought to have prayed in the suit to cancel the subsequent sale deeds executed by the first defendant. On this aspect, the law has been laid down by a Bench of three Hon'ble Judges of this Court in the case of Lala Durga Prasad & Ors. v. Lala Deep Chand & Ors.4,.
Paragraphs 40 to 42 of the said decision read thus:
"40. First, we reach the position that the title to the property has validly passed from the vendor and resides in the subsequent transferee. The sale to him is not void but only voidable at the option of the earlier "contractor". As the title no longer rests in the vendor it would be illogical from a conveyancing point of view to compel him to convey to the plaintiff unless steps are taken to revest the title in him either by cancellation of the subsequent sale or by reconveyance from the subsequent purchaser to him. We do not know of any case in which a reconveyance to the vendor was ordered but Sulaiman, C.J. adopted the other course in Kali Charan Singh v. Janak Deo Singh [Kali Charan Singh v. Janak Deo Singh, AIR 1932 All 694 : 1932 SCC OnLine All 154] . He directed cancellation of the subsequent sale (1953) 2 SCC 509 and conveyance to the plaintiff by the vendor in accordance with the contract of sale of which the plaintiff sought specific performance. But though this sounds logical the objection to it is that it might bring in its train complications between the vendor and the subsequent purchaser. There may be covenants in the deed between them which it would be inequitable to disturb by cancellation of their deed. Accordingly, we do not think that is a desirable solution.Page 16 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025
NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined
41. We are not enamoured of the next alternative either, namely, conveyance by the subsequent purchaser alone to the plaintiff. It is true that would have the effect of vesting the title to the property in the plaintiff but it might be inequitable to compel the subsequent transferee to enter into terms and covenants in the vendor's agreement with the plaintiff to which he would never have agreed had he been a free agent; and if the original contract is varied by altering or omitting such terms the court will be remaking the contract, a thing it has no power to do; and in any case it will no longer be specifically enforcing the original contract but another and different one.
42. In our opinion, the proper form of decree is to direct specific performance of the contract between the vendor and the plaintiff and direct the subsequent transferee to join in the conveyance so as to pass on the title which resides in him to the plaintiff. He does not join in any special covenants made between the plaintiff and his vendor; all he does is to pass on his title to the plaintiff. This was the course followed by the Calcutta High Court in Kafiladdin v. Samiraddin [Kafiladdin v. Samiraddin, AIR 1931 Cal 67 : 1930 SCC OnLine Cal 46] and appears to be the English practice. See Fry on Specific Performance, 6th Edn., p.90, Para207;also Potter v. Sanders [Potter v. Sa nders, (1846) 6 Hare 1 : 67 ER 1057] . We direct accordingly." (emphasis added).
15. Reliance is placed by the appellants on the decision of this Court in the case of B. Vijaya Bharathi3. In paragraph 17 of the said decision, this Court held thus:
"17. It must also be noted that though aware of two conveyances of the same property, the plaintiff did not ask for their cancellation. This again, would stand in the way of a decree of specific performance for unless the sale made by Defendant 1 to Defendant 2, and thereafter by Defendant 2 to Defendant 3 are set aside, no decree for specific performance could possibly follow. While Mr Rao may be right in stating that mere delay without more would not disentitle his client to the relief of specific performance, for the reasons stated above, we find that this is not such a case. The High Court was clearly right in finding that the bar of Section 16(c) was squarely attracted on the facts of the present case, and that therefore, the fact that Defendants 2 and 3 may not be bona fide purchasers would not come in the way of stating that such suit must be dismissed at the threshold because of lack of readiness and willingness, which is a basic condition for the grant of specific performance. (emphasis added) Page 17 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined A bench of two Hon'ble Judges has rendered this decision. Unfortunately, the attention of the Bench was not invited to binding precedent in the form of a decision of a larger bench in the case of Lala Durga Prasad & Ors.4. Hence, the decision in the case of B. Vijaya Bharathi3 is not a binding precedent. Therefore, there was no requirement to make a prayer in the plaint for cancellation or setting aside the subsequent sale deeds.
16. Clause (a) to (c) of Section 19 of the Specific Relief Act read thus:
"19. Relief against parties and persons claiming under them by subsequent title.-- Except as otherwise provided by this Chapter, specific performance of a contract may be enforced against--
(a) either party thereto;
(b) any other person claiming under him by a title arising subsequently to the contract, except a transferee for value who has paid his money in good faith and without notice of the original contract;
(c) any person claiming under a title which, though prior to the contract and known to the plaintiff, might have been displaced by the defendant;
(d).........................................................
(e)........................................................."(emphasis added) In view of clause (b) of Section 19, the defendants who are claiming under the sale deeds executed after the execution of the suit agreement can be subjected to a decree of specific performance as the suit agreement can be enforced specifically against such defendants unless they are bona-fide purchasers without the notice of the original contract. When, in a given case, the defendants, who are subsequent purchasers, fail to prove that they entered into the sale deed in good faith and without notice of the suit agreement, in view of Section 19(b), a decree for specific performance can be passed against such defendants. Therefore, in such a case where Section 19(b) is applicable, under the decree of specific performance, the subsequent purchasers can be directed to execute the sale deed along with the original vendor. There is no necessity to pray for the cancellation of the subsequent sale deeds."
17. For the foregoing reasons, the present First Appeal deserves to be allowed by quashing and setting aside the impugned order dated 9th April, 2024 passed by learned Page 18 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025 NEUTRAL CITATION C/FA/2130/2024 ORDER DATED: 07/04/2025 undefined Additional Senior Civil Judge, Gondal in Special Civil Suit No.23 of 2023 below Exh.8. Accordingly, the proceedings being Special Civil Suit No.23 of 2023 are hereby directed to be restored. Consequently, no order is required to be passed in Civil Application and it stands disposed of accordingly.
(SANGEETA K. VISHEN,J) (NIRAL R. MEHTA,J) ANUP Page 19 of 19 Uploaded by ANUP V PARIKH(HC00956) on Wed Apr 09 2025 Downloaded on : Wed Apr 09 22:11:35 IST 2025