HONOURABLE SRI JUSTICE P.NAVEEN RAO
&
HON'BLE SRI JUSTICE SAMBASIVARAO NAIDU
APPEAL SUIT NO.293 OF 2021
Date: 26.08.2022
Between:
Vattikonda Viswanadham, s/o. late Nagabushanam,
Aged 72 years, occu:Advocate-cum-Agriculture,
r/o.Allipuram Road, Khammam, Khammam District.
.....Appellant/respondent/
plaintiff
and
Kondaparthi Srinivas Rao, s/o. Ramaiah,
Aged 67 years, occu:Finance Business,
r/o.H.No.11-8-163/1, Lenin Nagar, Khammam,
Khammam district and two others.
.....Respondents/petitioners/
defendants
The Court made the following:
PNR,J & SSRN,J
AS No.293 of 2021
2
HONOURABLE SRI JUSTICE P.NAVEEN RAO
&
HON'BLE SRI JUSTICE SAMBASIVARAO NAIDU
APPEAL SUIT NO.293 OF 2021
JUDGMENT: (per Hon'ble Sri Justice P.Naveen Rao)
Heard Sri Kowturu Pavan Kumar, learned counsel for
appellant and Sri. A.Srinivasa Rao, learned counsel for the
respondents.
2. Parties are referred to as arrayed in the suit. Facts
leading to institution of this appeal are as under:
2.1. Plaintiff executed registered Agreement of Sale-cum- General Power of Attorney (GPA) bearing document No.1285/2001, dated 13.03.2001 in favour of defendant no.3 in respect of the suit schedule property on receiving sale consideration of 4,55,000/-. The GPA holder executed sale deed of the same property in favour of the 2nd defendant. 2.2. The 2nd defendant filed O.S.No.222 of 2004 in the Court of II Additional Junior Civil Judge, Khammam, praying to grant decree of perpetual injunction against the plaintiff, which was later transferred to the Court of Senior Civil Judge, Khammam, and renumbered as O.S.No.259 of 2009. By judgment dated PNR,J & SSRN,J AS No.293 of 2021 3 31.08.2016, the Senior Civil Judge dismissed the said suit. Appeal Suit No.21 of 2007 on the file of Principal District Judge, Khammam, preferred against judgment was allowed by judgment dated 08.02.2019. The Second Appeal No.155 of 2019 on the file of this Court, preferred by the plaintiff against judgment in A.S.No.21 of 2007, was dismissed. However, while dismissing Second Appeal, liberty was granted to challenge the documents i.e., the registered agreement of sale-cum-GPA bearing document No.1285/2001, dated 13.03.2001 and registered sale deed bearing No.3419/2001 dated 15.06.2001 as per law.
2.3. Taking cue from the observation made by the Second Appellate Court and alleging that Agreement of Sale cum-GPA was secured from the plaintiff under duress and coercion, the plaintiff instituted O.S.No.157 of 2019 in the Court of Special Sessions Judge for Fast-Tracking the cases relating to Atrocities against women-cum-VIII Additional District and Sessions Judge at Khammam, to declare the agreement of sale-cum-GPA dated 13.03.2001 and sale deed dated 15.06.2001 as illegal and consequently to grant perpetual injunction. On receipt of summons from the Court, the defendants filed Written Statements and also filed I.A.No.2 of 2021 under Order VII Rule PNR,J & SSRN,J AS No.293 of 2021 4 11(d) of Code of Civil Procedure, 1908 (for short, 'CPC'), to reject the plaint. The defendants asserted that the suit is barred by limitation on the face of it and, therefore, it is not maintainable. According to the defendants, the suit is instituted in the year 2019 challenging the registered agreement of sale-cum-GPA and sale deed executed in the year 2001 and there is inordinate delay and, therefore, on that ground alone the suit is liable to be dismissed. Accepting the plea of the defendants, Court below allowed I.A.No.2 of 2021 rejecting the plaint. Aggrieved thereby, this Appeal is preferred.
3. Learned counsel for the plaintiff contends that the trial Court grossly erred in allowing I.A.No.2 of 2021 rejecting the plaint as barred by limitation. Question of limitation is mixed question of law and fact and unless evidence is led, the Court cannot come to the conclusion at the preliminary stage itself to hold that the suit is barred by limitation. He further contends that Section 14 of the Limitation Act, 1963 (Act, 1963) prescribes exclusion of time of prosecuting the litigation bona fidely in the Court and in the instant case also, plaintiff was prosecuting the earlier round of litigation on the ground that Agreement of Sale-cum-GPA was obtained under coercion and duress, as he was under impression that there is a good PNR,J & SSRN,J AS No.293 of 2021 5 ground for setting aside the agreement of sale-cum-GPA. Once Agreement of Sale-cum-GPA is set aside, the subsequent sale deed automatically gets nullified. Only after dismissal of Second Appeal, plaintiff realized that he need to challenge the sale deed executed by the GPA holder. Further, second appellate Court granted liberty to challenge the documents and therefore the entire period spent in prosecuting the earlier round of litigation stands excluded and in that view of the matter, it cannot be said that suit is barred by limitation. The trial Court failed to appreciate this point. The scope of Section 14 of the Act, 1963 requires consideration during the course of trial and, therefore, trial Court ought not to have rejected the plaint at the threshold without leading evidence and without considering application of Section 14 of the Act, 1963.
4. In support of his contention, learned counsel for plaintiff relied upon the decision of the Hon'ble Supreme Court in Salim D.Agboatwala and others vs. Shamalji Oddhavji Thakkar 1 and others .
5. Per contra, learned senior counsel Sri M.V.Suresh Kumar, appearing for Sri A.Sreenivasa Rao, learned counsel for the 1 2021 SCC Online SC 735 PNR,J & SSRN,J AS No.293 of 2021 6 defendants submitted that at the time of executing registered Agreement of Sale-cum-GPA, the entire sale consideration was paid and, therefore, it is not a simple case of executing GPA, but the Agreement of Sale-cum-GPA creating interest in the 3rd defendant. On executing Agreement of Sale-cum-GPA, possession was also vested in the 3rd defendant. As he was authorized as GPA holder, he executed sale deed in favour of 2nd defendant. No exception can be taken to the said transaction by third defendant as he was having a valid GPA and full sale consideration was already paid to the suit schedule land. He further submitted that plaintiff had the knowledge of sale transaction entered into by the 3rd defendant in favour of 2nd defendant, but he kept quiet.
6. He would contend that having regard to the prayer sought by the plaintiff i.e., declaration, cancellation and rescission, as prescribed in Articles 582 and 593 of the Schedule appended to the Act, 1963, the period of limitation prescribed is only three years. Thus, from the date of execution of sale deed, within three years suit ought to be instituted, whereas the suit was 2 Article.58. To obtain any other declaration--Three years--When the right to sue first accrues.
3Article.59. To cancel or set aside an instrument or decree or for the rescission of a contract--Three years--When the facts entitling the plaintiff to have the instrument or decree cancelled or set aside or the contract rescinded first become known to him.
PNR,J & SSRN,J AS No.293 of 2021 7 instituted after about 15 years. On the face of it, delay is starring at the plaintiff. No further adjudication is required; no evidence is required to be taken out as the chronology of events are not in dispute. As on the face of it, suit is barred by limitation, the trial Court has rightly exercised its discretion under Order VII Rule 11(d) of CPC in rejecting the plaint. He would submit that Article 14 of the Act, 1963, has no application.
7. Learned senior counsel has drawn the attention to the relevant clauses in agreement of sale to point out that in- unequivocal terms, the plaintiff acknowledged receipt of full sale consideration, vested possession of the suit schedule property and also clearly stated that the 3rd defendant is Agent authorized to deal with the suit schedule land in any manner as he thinks fit. It is also categorically asserted that GPA cannot be cancelled. That being so, the sale deed executed by the 3rd defendant in favour of 2nd defendant cannot be nullified in collateral proceedings and once GPA is in force, and once 3rd defendant is authorized to execute the sale deed on behalf of the plaintiff, the sale transaction between the plaintiff through GPA holder (3rd defendant) and 2nd defendant cannot be declared as illegal.
PNR,J & SSRN,J AS No.293 of 2021 8
8. Learned senior counsel placed reliance on the decision of the Hon'ble Supreme Court in Dahiben vs. Arvindbhai Kalyanji 4 Bhanusali (Gajra) dead through legal representatives and others .
9. In reply, learned counsel for the plaintiff states that what is urged before the trial Court is triable issue and when it is a triable issue, unless evidence is led and matter is considered, the issue cannot be decided. Therefore, the trial Court grossly erred in rejecting plaint at threshold.
10. The prayer sought in O.S.No.157 of 2019 on the file of the Principal District Judge, Khammam, reads as under:
1) therefore the plaintiff prays the Hon'ble Court may kindly be declare as absolute owner of suit property by treating the alleged sale agreement cum GPA document No. 1285/2001 dated 13.3.2001 and another document sale deed in favour of defendant no.2 dated 15.6.2001 is null and void.
2) The Hon'ble Court may kindly cancel the documents No. 1285/2001 dated 13.3.2001 and sale deed in favour of Defendant No.2 dated 15.6.2001 which are voidable documents.
3) and Kindly direct the defendants jointly and severally to put the plaintiff in peaceful possession and enjoyment of suit land by remaining all substances or improvements if made by them and in case of their failure, to execute the decree through process of Hon'ble Court.
b) to grant a consequential permanent injunction restraining the defendants, their men, agents and 4 (2020) 7 SCC 366 PNR,J & SSRN,J AS No.293 of 2021 9 persons acting for on their behalf from interfering with the peaceful possession and enjoyment of the plaintiff over the suit property.
c) to award the costs of the suit and
d) to grant such other reliefs as the Hon'ble Court may
deemed fit just under circumstances of the case"
11. The undisputed facts are as under:
12. Plaintiff was owner of 1300 square yards out of Ac.1.32 guntas in Survey No.162 of Pakabanda area. Plaintiff executed registered agreement of sale cum General Power of Attorney dated 13.3.2001 bearing document no.1285 of 2001 on the part extent of land in favour of defendant no.3. Defendant no.3 as GPA Holder of Plaintiff in turn executed registered sale deed dated 15.6.2001 in favour of defendant no.2. Defendant no.2 instituted O.S.No.224 of 2004 which was renumbered as O.S.No.259 of 2009 in the Court of the Principal Junior civil Judge, Khammam (later transferred to the Court of Senior Civil Judge at Khammam) praying to grant decree of perpetual injunction against this plaintiff. Defendant claimed that by virtue of registered sale deed dated 15.6.2001 he became the owner of the subject land and is in possession and enjoyment whereas plaintiff was trying to interfere. The trial Court dismissed the suit holding that this plaintiff was in possession.
PNR,J & SSRN,J AS No.293 of 2021 10 On appeal before the Court of Principal District Judge in A.S.No.21 of 2017, the decision of the trial Court was reversed and appeal was decreed in favour of defendant no.2 herein. Aggrieved thereby, this plaintiff preferred S.A.No.155 of 2019 before this Court and this Court affirmed the decision of the First Appellate Court holding that trial Court erred in holding that plaintiff was in possession contrary to agreement of sale cum GPA and sale deed marked as exhibits A2 and A3. This Court also noticed that AGPA and sale deed were never challenged.
13. Plaintiff now challenges the Agreement of Sale-cum-GPA dated 13.3.2001 and sale deed dated 15.6.2001. He asserts that he came to know of execution of sale deed only in the year 2009 when he received summons in O.S.No.259 of 2009 and thereon he was contesting the claim of the defendant no.2 till the Second Appeal was disposed of on 17.7.2019 and asserts that entire period during which he was prosecuting the above litigation should be excluded for computation of limitation, therefore the suit is within the limitation period.
14. According to him, cause of action arose on 15.6.2001 and from which date he has been fighting the litigation. He further PNR,J & SSRN,J AS No.293 of 2021 11 asserts that cause of action is continuous and suit is filed within the period of limitation. In other words, it is not the case of plaintiff that only in 2009 he came to know of execution of registration of sale deed by his GPA holder. In the plaint, plaintiff challenges the agreement of sale cum GPA on the ground that it was obtained by duress and coercion, therefore, null and void. According to him, the attorney of the said document is only a name lender and had no financial capacity; no consideration was paid as mentioned in the document, the said document was executed as security as the defendant no.3 lent money to the plaintiff with an understanding that it would be discharged soon after due amount was paid and that he had paid the entire amount due. It is further asserted that in the presence of witnesses, defendant no.3 promised and undertook to cancel the document in respect of suit property. Thus, it is not the case of the plaintiff that he was not aware of the execution of the Agreement of Sale or GPA, authorising GPA to enter into sale deeds on his behalf, execution of the sale deeds on 15.6.2001 and at any rate, on receiving summons in the year 2009.
15. It is appropriate to notice that the earlier suit instituted by the defendant no.2 was to grant decree of injunction PNR,J & SSRN,J AS No.293 of 2021 12 restraining this plaintiff from interfering in possession and enjoyment on the ground that he has purchased the property by paying valid sale consideration and has been in possession and enjoyment of the property. This plaintiff contested the said suit by claiming to be in possession though he executed GPA and GPA in turn executed sale deed. The issue of ownership is different from possession. A person can claim possession as a lessee or even by encroaching into the land. Therefore, possession is not the same as ownership whereas earlier round of litigation was on the issue of possession. In the earlier round of litigation, it was categorically found by the First Appellate Court that possession vested in the defendant no.2 and granted injunction which declaration was affirmed by this Court in the Second Appeal. This Court held that there was sale transaction on open land and that possession follows title and until and unless the title is disputed and in the absence of any cogent evidence to show possession, merely because the plaintiff was original owner of the land, he could not claim to be in possession.
16. In the above factual background, the issue for consideration is whether the trial Court erred in allowing the PNR,J & SSRN,J AS No.293 of 2021 13 application filed under Order VII Rule 11 (B) of CPC and rejecting the plaint.
17. Two submissions urged before the trial Court were,
i) to exclude time consumed in contesting O.S.No.224 of 2004, the First and Second Appeals thereon; and ii) to compute period of limitation from the date of decision by this Court in S.A.No.155 of 2019.
18. On due consideration of scheme of Section 14 of Limitation Act, 1963 and law on the subject, the trial Court held that Section 14 has no application to the case on hand. Earlier suit was not instituted by him and his appeals were not dismissed for want of jurisdiction but on merits. On the second aspect, the Court below noticed that in the Second Appeal this Court only made an observation that the plaintiff did not contest the legality and validity of AGPA dated 13.3.2001 and sale deed dated 15.6.2001, exhibits A2 and A3, in appropriate proceedings and has not expressed opinion with reference to the rights of this plaintiff to challenge in appropriate proceedings. It is pertinent to notice that this Court held that right to challenge the legality of AGPA and sale deed executed by AGPA is subject to law, which means law of limitation. The Court did not give a PNR,J & SSRN,J AS No.293 of 2021 14 blanket discretion to assail the validity of those two documents by condoning the delay. Therefore, disposal of Second Appeal does not give independent cause of action nor the observations save limitation.
19. As per Article 59 of the Act, 1963, period of limitation to institute suit to cancel or set aside an instrument or decree or for the rescission of contract is three years when the facts entitling the plaintiff to have the instrument or decree cancelled or set aside or the contract rescinded first become known to him. Section 145 of the Act, 1963 enlarges the period of limitation. It excludes the time spent in prosecuting a litigation bona fidely. However, the plaintiff has to satisfy the conditions stipulated therein to avail the benefit. Plaintiff has to show that he was prosecuting the litigation with due diligence another civil proceeding against the defendant; the proceeding relates to the 5 S.14. Exclusion of time of proceeding bona fide in court without jurisdiction - (1) In computing the period of limitation for any suit the time during which the plaintiff has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of the appeal or revision, against the defendant shall be excluded, where the proceeding relates to the same matter in issue and is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it. (2) In computing the period of limitation for any application, the time during which the applicant has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, against the same party for the same relief shall be excluded, where such proceeding is prosecuted in good faith in a count of first instance or of appeal or revision, against the same party for the same relief shall be excluded, where such proceeding is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it. (3) Notwithstanding anything contained in rule 2 of Order XXIII of the Code of Civil Procedure, 1908 (5 of 1908), the provisions of sub-section (1) shall apply in relation to a fresh suit instituted on permission granted by the court under rule of that Order, where such permission is granted on the ground that the first suit must fail by reason of a defect in the jurisdiction of the court of other cause of a like nature. Explanation - For the purpose of this section, - (a) in excluding the time during which a former civil proceeding was pending, the day on which that proceeding was instituted and the day on which it ended shall both be counted; (b) a plaintiff or an applicant resisting an appeal shall be deemed to be prosecuting a proceeding; (c( misjoinder of parties or of causes of action shall be deemed to be a cause of a like nature with defect of jurisdiction.
PNR,J & SSRN,J AS No.293 of 2021 15 matter in issue; prosecuted in good faith in a Court which, from defect of jurisdiction or other cause of a like nature was unable to entertain it.
20. Sale deed dated 15.06.2001 is consequential to executing AGPA on 13.03.2001. Plaintiff assails the AGPA dated 13.03.2001. The validity of AGPA is nothing to do with execution of sale deed dated 15.06.2001. The grounds urged against AGPA were available when it was executed. The cause of action arose on 13.03.2001 and that is the date on which right to sue accrued to the plaintiff. Therefore, three years period lapsed by 13.03.2004, much prior to institution of earlier suit. The time spent in prosecuting earlier litigation cannot be excluded to test the legality of AGPA.
21. The recitals of Agreement of Sale-cum-GPA disclose that full sale consideration i.e., 4,55,000/- was received by the plaintiff and though he was intending to execute registered sale deed, but for some unspecified reasons, he could not execute registered sale deed and therefore he executed AGPA. He unconditionally authorised the GPA holder to deal with the property including alienation of the property to himself or to any other person of his choice, to avoid litigation, if any, and to PNR,J & SSRN,J AS No.293 of 2021 16 represent before the Registrar for Registration of sale deed. It also talks about handing possession to the GPA holder. Contrary to the recitals, he now takes the plea that he executed the said document due to duress and coercion. In other words, what is alleged now relate back to date on which the AGPA was executed and there are no new grounds. Therefore, if what is contended is true 13.03.2001 is the date on which cause of action first arose.
22. Alternatively, cause of action may have arisen on 22.05.2001 when plaintiff claims to have repaid amount borrowed with interest, but no steps were taken to cancel AGPA within three years from 22.05.2001. As rightly held by the trial Court, plaintiff ought to have filed suit within three years when the right to sue first arose to him i.e., 13.03.2001 or from 22.05.2001.
23. Basically, registration of sale deed amounts to putting on notice public at large on the change of ownership on an immovable property. Therefore, per se, no person can plead ignorance of the sale transaction. Looking from this angle, cause of action first arose against sale deed on 15.06.2001 when it was executed and registered.
PNR,J & SSRN,J AS No.293 of 2021 17
24. Further, ignoring the date of execution of AGPA and assuming that there was no information on registration of sale deed earlier, admittedly the plaintiff had knowledge of execution of sale deed dated 15.6.2001 at least when he received summons in the year 2009. Even after excluding the earlier period and computing three years from said date, period of limitation to avail remedy also lapsed in the year 2012.
25. In the facts of this case, the conditions stipulated in Section 14 of the Act, 1963 are not attracted. It cannot be said that plaintiff was bona fidely prosecuting earlier round of litigation. In the earlier round of litigation, he did set up claim to possession based on his ownership claim to the subject land. The issue of legality and validity of AGPA dated 13.03.2001 and execution of consequential sale deed on 15.06.2001 were not the subject of controversy. The plaintiff therein claimed to protect possession by relying on sale deed dated 15.06.2001 executed in his favour. It was not a case of defect of jurisdiction or other cause of like nature. The suit was decided on merits on contest. Plaintiff was not prosecuting the earlier litigation in good faith. The earlier suit does not relate to same matter in issue as in this suit. The observations made in S.A.No.155 of 2019 on not challenging the AGPA and sale deed and granting PNR,J & SSRN,J AS No.293 of 2021 18 liberty to avail appropriate remedy do not enable plaintiff to seek application of Section 14 of the Act, 1963.
26. The decision in Salim (supra) is on different set of facts and circumstances and said decision do not come to the aid of plaintiff. The rejection of plaint was sought primarily on two grounds, (i) the suit filed in the year 1987 challenging the action of the competent authorities under Maharashtra Tenancy and Agricultural Lands Act, 1948 carried out way back in 1963 and 1964 was hopelessly barred by limitation; and (ii) that in any case Section 85 of the Act, 1948 bars the jurisdiction of Civil Court. According to plaintiff therein only after making inspection of the records in connection with the suit land available in the office of defendant no.3 therein i.e., Court Receiver that they came across the correspondence and documents relating to the transactions and that the proceedings before the Agricultural Lands Tribunal were collusive, fraudulent and null and void and only after gaining the knowledge plaintiff was entitled to approach the Court. In those circumstances, the Hon'ble Supreme Court observed that limitation cannot be put against such a party and question of limitation is a mixed question of fact and law. Hon'ble Supreme Court observed that the answer to the issue regarding limitation PNR,J & SSRN,J AS No.293 of 2021 19 will depend upon the evidence with regard to the issuance and service of notice and knowledge of the plaintiffs. 26.1. The Hon'ble Supreme Court observed that the conditions precedent to the exercise of the power are stringent and it is especially so when rejection of plaint is sought on the ground of limitation. Hon'ble Supreme Court observed that when a plaintiff claims that he gained knowledge of the essential facts giving rise to the cause of action only at a particular point of time, the same has to be accepted at the stage of considering the application under Order VII Rule 11. Hon'ble Supreme Court further observed that the plea regarding the date on which the plaintiffs gained knowledge of the essential facts, is crucial for deciding the question whether the suit is barred by limitation or not. Such issue becomes a triable issue and hence the suit cannot be thrown out at the threshold.
27. In Deena (dead) through LRS Vs. Bharat Singh (dead) through LRS6, the plaintiff sought for exclusion of period between 21-3-1980 to 15-2-1982 under Section 14 of the Limitation Act for computation of the period of limitation for filing the suit. Briefly noted, the facts are as under: 6
(2002) 6 SCC 336 PNR,J & SSRN,J AS No.293 of 2021 20 27.1. Appellant mortgaged his land measuring 9 bighas 18 biswas for Rs.2500/- with possession on 7-2-1947 with Plaintiff no.2 and father of Plaintiffs 15 to 19 and Khubi Ram @ Khushi Ram who is the predecessor-in-interest of plaintiffs 2 to
14. He filed an application for redemption of the land before the Collector, which request was accepted on 29-2-1980 and the land was ordered to be redeemed on payment of the mortgage money. Appellants filed suit seeking declaration that they had become owners of the property and order of redemption granted by the Collector was null and void. The suit was decreed by the trial Court. At the appellant stage, plaintiffs withdrew the suit with permission to file fresh suit and thereafter fresh suit was instituted seeking declaration that plaintiffs were owners of the suit property, the order passed by the Collector was void and inoperative and did not affect their rights. One of the issues framed by the trial Court was on limitation and question considered was whether plaintiffs were entitled to seek exclusion of the period from 21.3.1980 to 24.2.1982 during which period they were prosecuting earlier round of litigation. The trial Court held against the plaintiffs on the issue of limitation holding that plaintiffs were not prosecuting the proceedings in the earlier round of litigation with due diligence PNR,J & SSRN,J AS No.293 of 2021 21 and good faith. First Appellate Court affirmed the decision holding that Section 14 of the Limitation Act does not come to the rescue of the plaintiffs. High Court reversed the decisions of the Appellate Court and trial Court and decreed the suit filed by the plaintiffs. On Order XXIII Rule 2 of CPC, Hon'ble Supreme Court held as under:
"14. The main factor which would influence the court in extending the benefit of Section 14 to a litigant is whether the prior proceeding had been prosecuted with due diligence and good faith. The party prosecuting the suit in good faith in the court having no jurisdiction is entitled to exclusion of that period. The expression "good faith" as used in Section 14 means "exercise of due care and attention". In the context of Section 14 the expression "good faith" qualifies prosecuting the proceeding in the court which ultimately is found to have no jurisdiction. The finding as to good faith or the absence of it is a finding of fact. This Court in the case of Vijay Kumar Rampal v. Diwan Devi [AIR 1985 SC 1669] observed : (AIR p. 1670, para 3) "The expression good faith qualifies prosecuting the proceeding in the court which ultimately is found to have no jurisdiction. Failure to pay the requisite court fee found deficient on a contention being raised or the error of judgment in valuing a suit filed before a court which was ultimately found to have no jurisdiction has absolutely nothing to do with the question of good faith in prosecuting the suit as provided in Section 14 of the Limitation Act."
15. The other expressions relevant to be construed in this regard are "defect of jurisdiction" and "or other cause of a like nature". The expression "defect of jurisdiction" on a plain reading means the court must lack jurisdiction to entertain the suit or proceeding. The circumstances in which or the grounds on which, lack of jurisdiction of the court may be found are not enumerated in the section. It is to be kept in mind that there is a distinction between granting permission to the plaintiff to withdraw the suit with leave to file a fresh suit for the same relief under Order 23 Rule 1 and exclusion of the period of pendency of that suit for the purpose of computation of limitation in the subsequent suit under Section 14 of the Limitation Act. The words "or other cause of a like nature" are to be construed ejusdem generis with the words "defect of jurisdiction", PNR,J & SSRN,J AS No.293 of 2021 22 that is to say, the defect must be of such a character as to make it impossible for the court to entertain the suit or application and to decide it on merits. Obviously Section 14 will have no application in a case where the suit is dismissed after adjudication on its merits and not because the court was unable to entertain it."
27.2. The Hon'ble Supreme Court further observed that from the judgment under Appeal there was no finding in the previous suit holding the suit to be not entertainable on any ground. The ground on which withdrawal of the suit was sought was that Smt Ghogri, one of the mortgagors, was not made party to the suit. Hon'ble Supreme Court observed that it is not the case of the plaintiffs that the court had found the suit to be not maintainable on that ground. Non-impleadment of Smt Ghogri, a necessary party, in the suit was a clear case of laches on the part of the plaintiffs. In such circumstances it could not be said that the plaintiffs were prosecuting the previous suit in good faith.
28. In Dahiben Vs Arvindbhai Kalyanji Bhanusali (Gajra)7 scope of Order VII Rule 11 of CPC was considered extensively by Hon'ble Supreme Court. After obtaining due permissions, plaintiffs sold the property to first respondent on 2.7.2009. The sale deed records receipt of full sale consideration. First 7 (2020) 7 SCC 366 PNR,J & SSRN,J AS No.293 of 2021 23 respondent in turn sold very same property to the second and third respondents on 1.4.2013. On 15.12.2014 plaintiff instituted the suit against original purchaser by impleading subsequent purchasers praying that sale deed dated 2.7.2009 be cancelled and declare it as being illegal void, ineffective and not binding on them on the ground that the sale consideration fixed by the Collector was not paid in entirety by respondent no.1. In other words, suit for cancellation of sale deed was filed after five years of execution of sale deed by the vendee to the third parties. Prior to institution of the suit, at no point of time, plaintiffs raised any grievance of not receiving the full sale consideration mentioned in the sale deeds and for the first time such allegation was made after five years from the date of execution of the sale deeds. The Hon'ble Supreme Court observed that delay of 5 ½ years after latest cause of action arose in 2009 shows that the suit is clearly barred by limitation as per Section 15 of the Limitation Act. That the cause of action arose when sale deed was executed on 2.7.2009; that the plaintiffs failed to discharge the onus of proof that the suit was filed within the period of limitation. The plaint is therefore, liable to be rejected under Order 7 Rule 11(d) CPC.
PNR,J & SSRN,J AS No.293 of 2021 24 28.1. The Hon'ble Supreme Court further observed that remedy under Order 7 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 a trial, on the basis of the evidence adduced, if it is satisfied that the action should be terminated on any of the grounds contained in this provision. It emphasised that "the underlying object of Order 7 Rule 11(a) is that if in a suit, no cause of action is disclosed, or the suit is barred by limitation under Rule 11(d), the court would not permit the plaintiff to unnecessarily protract the proceedings in the suit. In such a case, it would be necessary to put an end to the sham litigation, so that further judicial time is not wasted." Further, the Supreme Court administered word of caution by holding that "the power conferred on the court to terminate a civil action is, however, a drastic one, and the conditions enumerated in Order 7 Rule 11 are required to be strictly adhered to". The Hon'ble Supreme Court held as under:
"23.4. In Azhar Hussain v. Rajiv Gandhi [Azhar Hussain v. Rajiv Gandhi, 1986 Supp SCC 315. Followed in Manvendrasinhji Ranjitsinhji Jadeja v. Vijaykunverba, 1998 SCC OnLine Guj 281 : (1998) 2 GLH 823] this Court held that the whole purpose of conferment of powers under this provision is to ensure that a litigation which is meaningless, and bound to prove abortive, should not be permitted to waste judicial time of the court, in the following words : (SCC p. 324, para 12) PNR,J & SSRN,J AS No.293 of 2021 25 "12. ... The whole purpose of conferment of such powers is to ensure that a litigation which is meaningless, and bound to prove abortive should not be permitted to occupy the time of the court, and exercise the mind of the respondent. The sword of Damocles need not be kept hanging over his head unnecessarily without point or purpose. Even in an ordinary civil litigation, the court readily exercises the power to reject a plaint, if it does not disclose any cause of action."
xxx 23.11. The test for exercising the power under Order 7 Rule 11 is that if the averments made in the plaint are taken in entirety, in conjunction with the documents relied upon, would the same result in a decree being passed. This test was laid down in Liverpool & London S.P. & I Assn. Ltd. v. M.V. Sea Success I [Liverpool & London S.P. & I Assn. Ltd. v. M.V. Sea Success I, (2004) 9 SCC 512] which reads as : (SCC p. 562, para 139) "139. Whether a plaint discloses a cause of action or not is essentially a question of fact. But whether it does or does not must be found out from reading the plaint itself. For the said purpose, the averments made in the plaint in their entirety must be held to be correct. The test is as to whether if the averments made in the plaint are taken to be correct in their entirety, a decree would be passed."
23.12. In Hardesh Ores (P) Ltd. v. Hede & Co. [Hardesh Ores (P) Ltd. v. Hede & Co., (2007) 5 SCC 614] the Court further held that it is not permissible to cull out a sentence or a passage, and to read it in isolation. It is the substance, and not merely the form, which has to be looked into. The plaint has to be construed as it stands, without addition or subtraction of words. If the allegations in the plaint prima facie show a cause of action, the court cannot embark upon an enquiry whether the allegations are true in fact. D. Ramachandran v. R.V. Janakiraman [D. Ramachandran v. R.V. Janakiraman, (1999) 3 SCC 267; See also Vijay Pratap Singh v. Dukh Haran Nath Singh, AIR 1962 SC 941] .
23.13. If on a meaningful reading of the plaint, it is found that the suit is manifestly vexatious and without any merit, and does not disclose a right to sue, the court would be justified in exercising the power under Order 7 Rule 11 CPC.
PNR,J & SSRN,J AS No.293 of 2021 26 23.15. The provision of Order 7 Rule 11 is mandatory in nature. It states that the plaint "shall" be rejected if any of the grounds specified in clauses (a) to (e) are made out. If the court finds that the plaint does not disclose a cause of action, or that the suit is barred by any law, the court has no option, but to reject the plaint.
24. "Cause of action" means every fact which would be necessary for the plaintiff to prove, if traversed, in order to support his right to judgment. It consists of a bundle of material facts, which are necessary for the plaintiff to prove in order to entitle him to the reliefs claimed in the suit.
24.1. In Swamy Atmananda v. Sri Ramakrishna Tapovanam [Swamy Atmananda v. Sri Ramakrishna Tapovanam, (2005) 10 SCC 51] this Court held : (SCC p. 60, para 24) "24. A cause of action, thus, means every fact, which, if traversed, it would be necessary for the plaintiff to prove in order to support his right to a judgment of the court. In other words, it is a bundle of facts, which taken with the law applicable to them gives the plaintiff a right to relief against the defendant. It must include some act done by the defendant since in the absence of such an act, no cause of action can possibly accrue. It is not limited to the actual infringement of the right sued on but includes all the material facts on which it is founded."
(emphasis supplied) 24.3. Subsequently, in ITC Ltd. v. Debts Recovery Appellate Tribunal [ITC Ltd. v. Debts Recovery Appellate Tribunal, (1998) 2 SCC 70] this Court held that law cannot permit clever drafting which creates illusions of a cause of action. What is required is that a clear right must be made out in the plaint. 24.4. If, however, by clever drafting of the plaint, it has created the illusion of a cause of action, this Court in Madanuri Sri Rama Chandra Murthy v. Syed Jalal [Madanuri Sri Rama Chandra Murthy v. Syed Jalal, (2017) 13 SCC 174 : (2017) 5 SCC (Civ) 602] held that it should be nipped in the bud, so that bogus litigation will end at the earliest stage. The Court must be vigilant against any camouflage or suppression, and determine whether the litigation is utterly vexatious, and an abuse of the process of the court.
xxx PNR,J & SSRN,J AS No.293 of 2021 27
28. A three-Judge Bench of this Court in State of Punjab v. Gurdev Singh [State of Punjab v. Gurdev Singh, (1991) 4 SCC 1 : 1991 SCC (L&S) 1082] held that the Court must examine the plaint and determine when the right to sue first accrued to the plaintiff, and whether on the assumed facts, the plaint is within time. The words "right to sue" mean the right to seek relief by means of legal proceedings. The right to sue accrues only when the cause of action arises. The suit must be instituted when the right asserted in the suit is infringed, or when there is a clear and unequivocal threat to infringe such right by the defendant against whom the suit is instituted. Order 7 Rule 11(d) provides that where a suit appears from the averments in the plaint to be barred by any law, the plaint shall be rejected."
29. Having regard to scope of Section 14 of the Act, 1963 and the law holding the field the plaintiff is not entitled to take recourse to Section 14. The facts in issue as urged in the plaint and prayer sought are clear and no ambiguity in assessing the date of arising of cause of action. On a meaningful reading of the plaint, it is apparent that this is a vexatious litigation and needs to be nipped in the bud. We see no error in the decision of trial Court allowing I.A.No.2 of 2021 and rejecting the plaint. The Appeal fails. It is accordingly dismissed. Pending miscellaneous petitions if any shall stand closed.
______________________________ P.NAVEEN RAO, J ______________________________ SAMBASIVA RAO NAIDU, J Date: 26.08.2022 Kkm/tvk PNR,J & SSRN,J AS No.293 of 2021 28 HONOURABLE SRI JUSTICE P.NAVEEN RAO & HON'BLE SRI JUSTICE SAMBASIVARAO NAIDU APPEAL SUIT NO.293 OF 2021 Date: 26.08.2022 Kkm/tvk