Bombay High Court
Trienity Prime Property Projects ... vs Ramesh Pandurang Mali And Ors on 18 July, 2022
Bench: R. I. Chagla
IAL.2566.22a wt....doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
INTERIM APPLICATION (L) NO. 2566 OF 2022
IN
SUIT (L) NO. 29721 OF 2021
M/s Trienity Prime Property
Projects LLP & Ors. ... Applicants
(Org. Def. Nos. 2, 5, 6 & 7)
In the matter between:
Ramesh Mali ... Plaintiff
Versus
M/s Samrat Associates & Ors. ... Defendants
ALONG WITH
INTERIM APPLICATION (L) NO. 3696 OF 2022
IN
SUIT (L) NO. 29721 OF 2021
M/s Samrat Associates and Anr. ... Applicants
(Org. Def. Nos. 1 & 3)
In the matter between:
Ramesh Mali ... Plaintiff
Versus
M/s Samrat Associates & Ors. ... Defendants
ALONG WITH
INTERIM APPLICATION (L) NO. 4569 OF 2022
IN
SUIT (L) NO. 29721 OF 2021
Amrishchandra Agarwal ... Applicant
(Org. Def. No. 10)
In the matter between:
Waghmare 1/60
IAL.2566.22a wt....doc
Ramesh Mali ... Plaintiff
Versus
M/s Samrat Associates & Ors. ... Defendants
Mr. Chetan Kapadia a/w Chaitanya Chavan, Rahul Singh and Pranali
Raut i/b M/s. Legal Catalyst for the Plaintiff.
Mr. Naushad Engineer with Shreya Jha a/w Mr. Hemang Raythattha,
S.M. Seegarla, Shalaka Chamboowala and Swapnil Shikhare i/b RMG
Law Associates for Defendant Nos.1, 3 and 4.
Mr. Mayur Khandeparkar a/w Vikranmjit Garewal and Ms. Priyanka
Fadia i/b Shashank Fadia for Defendant Nos.2, 5, 6 and 7.
Mr. Ankit Lohia with Ms. Aditi Bhat a/w Kunal Parekh, Ms. Nirali Shah
i/b Dua Associates for Defendant Nos.10, 11 (a), (b) and 12 and
proposed Defendant Nos.19 and 20.
Mr. Rohan Agarwal i/b Prabha Badadare for Defendant Nos.13 to 15.
Mr. Bhavin Gada a/w Ms. Manshi Shah i/b M/s. Pravin Mehta and
Mithi Co. for IA(L)/7677/2022 in Propose Defendant Nos.21 and 22.
CORAM : R.I. CHAGLA, J.
RESERVED ON : 11th APRIL, 2022 &
RESERVED ON : 7th JUNE, 2022.
PRONOUNCED ON : 18th JULY, 2022.
ORAL JUDGMENT :
1 The Interim Application (L) No.2566 of 2022 is filed by
Original Defendant Nos.2, 5, 6 and 7 to the captioned Suit whereas
Interim Application (L) No.3696 of 2022 has been filed by Original
Defendant Nos.1 and 3 to the Suit and Interim Application (L)
Waghmare 2/60
IAL.2566.22a wt....doc
No.4569 of 2022 has been filed by Original Defendant No.10 on behalf
of Defendant Nos.10 to 12 to the Suit. All the Interim Applications are
filed under Order VII Rule 11 (d) of the Code of Civil Procedure, 1908
seeking rejection of plaint on the ground that the Suit is barred by
limitation. They are being disposed of by this common judgment.
2 There are certain facts in the plaint which are necessary to
be adverted to. The Plaintiff's father namely late Pandurang Barkya
Mali was the owner of the suit properties. By a purported agreement
for sale dated 30.06.1974, Defendant Nos.8 and 9 who are referred to
as Kanayalal Kalooji Jain ('Jain') and Narain Tulsidas Kanal ('Kanal') in
the plaint, sought to purchase suit properties from the Plaintiff's
deceased father. Thereafter, Jain and Kanal entered into agreements
dated 05.08.1974 and 18.09.1974 with late J.N. Agarwal (predecessor
of Original Defendant Nos.10 to 12) in respect of the suit properties.
The late J.N. Agarwal issued public notices and advertisements invited
claims in respect of the Suit properties on 06.10.1979 and 11.10.1979.
The public notices and advertisements were responded to by the
Plaintiff's deceased father disputing the right of the late J.N. Agarwal
to purchase the suit properties as according to him the original
agreement with Defendant Nos.8 and 9 had come to an end. Being
aggrieved, the late J.N. Agarwal filed Suit No.358 of 1980 before this
Waghmare 3/60
IAL.2566.22a wt....doc
Court seeking specific performance of agreement dated 18.09.1974.
By an order dated 26.11.1982, this Court granted interim injunction
restraining the Defendants in the said Suit from in any manner dealing
with or disposing of or alienating, encumbering or transferring the suit
properties.
3 Thereafter, with the intention of settling the disputes
between the Plaintiff's family and the Agarwal family, Memorandum of
Understanding dated 11.12.2008 came to be executed between the
Plaintiff, Defendant Nos.13, 15 and Defendant Nos. 3 and 4. Under
the said Memorandum of Understanding, Defendant Nos.3 and 4 were
the purchasers of the suit properties. The total consideration
mentioned therein was a sum of Rs.13,51,00,000/- and for which
postdated cheques payable within 11 months were handed over to the
Plaintiff. It was agreed between the parties to the said Memorandum
of Understanding that Defendant No.1 shall settle/ cause settlement
with all parties at their own costs and have the injunction order
vacated.
4 Sometime in December 2013, Defendant No.3 called the
Plaintiffs and his family members to his office at Gurgaon for the
purpose of executing conveyance deeds. The Plaintiff has claimed that
Waghmare 4/60
IAL.2566.22a wt....doc
Defendant No.3 had informed the Plaintiff that the said Memorandum
of Understanding would have to be registered and for which signatures
on several documents, bank papers and stamp papers were obtained by
Defendant No.3 from the Plaintiff and his family members. It was in
the month of February, 2014 when the Plaintiff attended the office of
Sub-Registrar and executed the documents during which the Plaintiff
has claimed that he happened to get a glimpse of Defendant Nos.8 to
12 in the registration office.
5 The Plaintiff has admitted that he received payment of
Rs.96,52,116/- through pay orders towards purchase of the suit
property. However, the Plaintiff claims that he accepted the same
under the representation made by Defendant No.3 and 4 that these
monies were paid towards the balance consideration under the
Memorandum of Understanding dated 11.12.2008. On 20.02.2014,
the Plaintiff admits that he executed four conveyances for sale of the
suit property in favour of Original Defendant Nos.10 to 12. However,
in paragraph 29 of the Plaint, it is stated that the Plaintiff having been
misrepresented and fraudulently made to believe about the contents of
the document executed the alleged impugned Conveyance Deeds as to
be Memorandum of Understanding in favour of Defendant Nos.1 to 7.
Waghmare 5/60
IAL.2566.22a wt....doc
6 The Plaintiff has further stated for the first time he became
apprehensive of some foul play and fraud on 27.07.2016. This is when
the Plaintiff received notice from the Land Record Department,
Maharashtra with respect to measuring boundaries of one of the suit
properties being Final Plot No.709. The notice was issued under
Section 150(2) of the Maharashtra Land Revenue Code, 1966 by the
City Survey Officer. It was stated in the notice that the Plaintiff and
Defendant Nos.13 to 15 were sellers and the Original Defendant
Nos.10 to 12 described as the Agarwal family were purchasers under
the conveyance deeds which were duly registered along with the
registration numbers. The Plaintiff was accordingly notified that the
last rights record and mutation register would be amended to reflect
the sale in favour of the Agarwal family and that the names of the
Agarwal family would be entered in the record of rights.
7 The Plaintiff after receiving legal advice, addressed a reply
to the City Survey Officer, objecting to the proposed amendment in the
record of rights by stating that the Plaintiff had not received full
compensation for the suit properties and in such a situation the
Agarwal family namely Mr. Amrishchandra Jagdish Narayan Agarwal
Waghmare 6/60
IAL.2566.22a wt....doc
and others, the buyers of the land and property on the basis of the
conveyance deeds, have not received full ownership of the suit
properties.
8 Defendant Nos.10 to 12 filed Chamber Summons No.1741
of 2016 in the Suit filed by their predecessors. The suit being Suit
No.358 of 1980 which had been transferred to the Bombay City Civil
Court due to change in the pecuniary jurisdiction. It was specifically
stated in the Chamber Summons that the Mali family i.e. family of the
Plaintiff had settled their disputes in the said Suit and necessary
documents were executed to record the settlement.
9 The Plaintiff through their Advocates issued public notice
on 18.01.2017 stating that the Plaintiff is constrained to file a Suit
seeking declaration from this Court to declare the Deeds of
Conveyance dated 13.12.2013 as null and void being obtained by
fraud. The public notice was issued in two newspapers namely
Navshakti in Marathi and Free Press Journal in English for cautioning
the general public for not dealing in any manner in respect of the suit
properties.
10 The Plaintiff in response to the Chamber Summons
No.1741 of 2016 filed the affidavit dated 14.02.2017 in Suit No.358 of
Waghmare 7/60
IAL.2566.22a wt....doc
1980 wherein they stated that the Plaintiff in that Suit, namely the
Defendant Nos.10 to 12 in this Suit had approached the Plaintiff herein
for the settlement of the issue in that Suit and agreed to pay the
consideration price. However, in view of the Plaintiff not having paid
the entire consideration price as agreed, there is no settlement
whatsoever, although the Plaintiff in that Suit got executed certain
documents by fraud in their favour. It is further stated that a Suit for
declaration of the said documents to be null and void, would be filed.
11 In the year 2018, the Plaintiff has claimed that they
noticed certain development activities on the suit property. When the
Plaintiff physically attempted to enter the suit property, he was stopped
by the persons who informed him that the suit property was purchased
by Original Defendant Nos.10 to 12.
12 The Plaintiff has thereafter claimed that In October, 2018
he noticed development activities on suit property 4 and when the
Plaintiff physically attempted to enter the suit property 4, he was
stopped by the personnel present who informed him that the same was
purchased by Defendant Nos.10 to 12. The Plaintiff further claims that
he was not allowed to enter the other Suit properties as well. In view
of forceful possession of the suit properties being taken by the
Waghmare 8/60
IAL.2566.22a wt....doc
Defendants, a Police complaint dated 28.10.2018 was filed. The
Plaintiff thereafter filed complaint against Defendant Nos.1 to 7 and 10
to 12 before the Economic Offence Wing on 20.12.2018. The Economic
Offence Wing by letter dated 03.01.2019 transferred the investigation
to the local Police Station. However, the local Police Station refused to
take cognizance of the Plaintiff's complaint on the ground that the
complaint is of civil nature. The Plaintiff accordingly claims that the
cause of action has arisen in October, 2018 when forceful possession of
the suit properties were taken and thereafter arose in the year 2019
when the local Police Station refused to take cognizance of the
complaint. The Plaintiff has claimed further cause of action arose in
the month of November, 2021 when Defendant Nos.1 to 7 refused to
pay the consideration as promised under the Memorandum of
Understanding dated 11.12.2008 unless no objection is given to the
pending Chamber Summons in Suit No.7420 of 1980 before the City
Civil Court and that the same is continued till today. The Plaintiff has
accordingly filed the captioned Suit on 14.12.2021.
13 Mr. Naushad Engineer, learned Counsel appearing for
Defendant Nos.1, 3 and 4 has submitted that from the facts, as set out
in the plaint, it is apparent that the Suit is barred by the Law of
Limitation. He has submitted that the Plaintiff has admittedly been a
Waghmare 9/60
IAL.2566.22a wt....doc
party to the Conveyance Deeds which he has impugned in the present
suit, having executed the same and by which Conveyance Deeds, the
suit properties were transferred to the Original Defendant Nos.10 to
12. This is borne out from paragraphs 33 and 35 of the plaint read
with the Plaintiff's affidavit dated 14.02.2017 which is in response to
the Chamber Summons No.1741 of 2016 filed in Suit No.358 of 1980
and by which the Plaintiff has admitted that the Original Defendant
Nos.10 to 12 approached the Plaintiff for settlement and agreed to pay
consideration price for purchase of the suit properties. However, the
full consideration was not paid by Defendant Nos.10 to 12 and hence,
there was no settlement. Accordingly, the claim of the Plaintiff is that
the documents were executed by fraud.
14 Mr. Engineer has submitted that assuming that there is any
fraud or misrepresentation, the same was to the knowledge of the
Plaintiff by 22.08.2016 or 14.02.2017 and the Plaintiff himself has
stated that he would be filing a Suit for declaration that the
Conveyance Deeds were not binding. He has submitted in that case,
the Suit had to be filed latest by 21.08.2019 or latest by 15.02.2020.
The Suit having been filed on 14.12.2021 i.e. approximately two years
after the limitation had expired, would be barred by limitation.
Waghmare 10/60
IAL.2566.22a wt....doc
15 Mr. Engineer has submitted that even assuming that the
Conveyance Deeds were executed by fraud or misrepresentation as
claimed by the Plaintiff, Section 19 of the Contract Act, 1872,
stipulates that the same was only voidable at the option of the Plaintiff.
The Plaintiff would have to sue for cancellation of the documents and,
therefore, the present Suit would have to be filed within three years of
knowledge of such fraud or misrepresentation which is admittedly
three years from 22.08.2016 or 14.02.2017 and, thus, the Suit having
been filed beyond the period of three years, is clearly barred by law of
limitation under Article 59 of the Limitation Act.
16 Mr. Engineer has made reference to decisions of the
Supreme Court which clearly lay down the principles for deciding an
application under Order VII Rule 11. One such decision of the
Supreme Court is in Dahiben vs. Arvindbhai Bhanushali reported in
(2020) 7 SCC 366. These principles include that the Court must read
the plaint as a whole and the substance and not the form must be
ascertained. The Court must look at documents which are annexed to
the Plaint. The Court must ascertain if the assurance made in the
plaint are contrary to statutory law, or judicially dicta, for deciding
whether a case for rejecting the plaint at the threshold is made out.
The Court must not allow the Plaintiff to take advantage of clever
Waghmare 11/60
IAL.2566.22a wt....doc
drafting and circumvent the provision of law which bars the Suit. The
provisions of Order VII Rule 11 are mandatory and if on a meaningful
reading of the plaint, it is found that the Suit is barred by any law then
the Court shall dismiss the Suit. He has also relied upon the decision
of the Supreme Court in Sree Surya Developers & Promoters V. N.
Sailesh Prasad, (2022) SCC Online SC 165, which has held that the
Plaintiff cannot be allowed to circumvent that provision by means of
clever drafting so as to avoid mention of those circumstances, by which
the Suit is barred by law of limitation. In that case the Plaintiff had
sought multiple reliefs and by clever drafting wanted the Suit to be
maintainable, which otherwise would not be maintainable questioning
the Compromise Decree.
17 Mr. Engineer has thereafter referred to the decisions of the
Supreme Court in support of his contention that the Plaintiff would
have to set aside the documents which prevent the Plaintiff from
exercising its right, title and interest in property. These decisions are
under Article 59 of the Limitation Act. They are as under :
i) Mohd. Noorul Hoda v. Bibi Raifunnisa, (1996) 7
SCC 767 at para 6;
Waghmare 12/60
IAL.2566.22a wt....doc
ii) Abdul Rahim v. Sk. Abdul Zabar, (2009) 6 SCC 160
at paragraphs 26 to 29; and
iii) Raghwendra Sharan Singh v. Ram Prasanna Singh,
(2020) 16 SCC 601 at paragraphs 7 and 8.
18 He has further relied upon the settled law that where
possession can only be granted if a document is set aside, then Article
65 of the Limitation Act is not applicable and instead, Article 59 of the
Limitation Act would be applicable and for which he has relied upon
the decision of the Supreme Court in Mohd. Noorul Hoda (supra) and
Rajah of Ramnad v. A.L.A.R.R.M. Arunachellam Chettiar, Madras LJR
Vol.XXIV 592 (pages 599 and 615, 616). (AIR 1916 Madras 350).
19 He has also relied upon the decision of the Supreme Court
in State of Punjab v. Balkaran Singh (2006) 12 SCC 709 at paragraph
17 and Anand Madanmohan Jaiswal v. Pratibha (2017) SCC Online
Bom 8509 at paragraph 20, in support of his submission that if the
main relief is barred then the consequential relief cannot be granted.
He has accordingly submitted that Suit is clearly barred by the law of
limitation and in view thereof the Plaint be rejected under Order VII
Rule 11 (d) of the Civil Procedure Code.
Waghmare 13/60
IAL.2566.22a wt....doc
20 Mr. Ankit Lohia, the learned Counsel appearing for
Defendant Nos.10 to 12 has supported the submissions of Mr. Engineer.
He has submitted that the captioned Suit is essentially a Suit for
cancellation of four Conveyance Deeds. The relief of possession
claimed by the Plaintiff is only a relief consequential to the relief of
cancellation. A meaningful reading of the plaint makes it clear that the
captioned Suit essentially seeks cancellation of the Conveyance Deeds.
He has also placed reliance upon Section 31 of the Specific Relief Act,
1963 and Article 59 of the Limitation Act, 1963 in support of his
submission that absent the relief for declaration of cancellation of the
Conveyance Deeds, the Plaintiff is not entitled to seek the relief of
possession. He has submitted that the Conveyance Deeds are
registered documents by which the Suit properties have been sold to
Defendant Nos.10 to 12. The execution of the document is admitted
by the Plaintiff before the Sub-Registrar of Assurances in accordance
with the procedures of Registration Act, 1908. The Plaintiff has
admittedly received and accepted consideration under the Conveyance
Deeds and continues to enjoy the benefit of money paid to him under
the Conveyance Deeds. He has also placed reliance upon the events
which transpired between the execution of the Conveyance Deeds and
filing of Suit which clearly reveal that the Plaintiff was aware of the
Waghmare 14/60
IAL.2566.22a wt....doc
nature of the Conveyance Deeds, the character thereof and the
consequences thereof and acquiesced in the same. This is borne out
from the notice dated 22.08.2016 addressed by the Land Record
Department, Maharashtra to the Plaintiff. Mr. Lohia has submitted that
there is a clear admission on the part of the Plaintiff in the Plaintiff's
reply dated 29.08.2016 to the said Notice sent under Section 150(2) of
Maharashtra Land Revenue Act, 1966 as well as in the subsequent
affidavit in reply dated 14.02.2017 to the Chamber Summons No.1741
of 2016 preferred by Defendant Nos.10 to 12 in their Suit that there
were sale transactions and that title of the Suit properties would pass
to Defendant Nos.10 to 12 and the only grievance being that the entire
consideration had not been received.
21 Mr. Lohia has further submitted that the Memorandum of
Understanding executed between the Plaintiff and Defendant No.1 also
makes it evident that the Plaintiff had for all practical purposes,
effectively divested all his interest in the suit properties and only the
acquisition/enjoyment of the rights by the Defendant No.1 was subject
to the order of injunction granted by this Court in the Suit filed by
Defendant Nos.10 to 12.
Waghmare 15/60
IAL.2566.22a wt....doc
22 Mr. Lohia has submitted that this is a classic case where
the Plaintiff by clever drafting has attempted to make out an illusory
cause of action to bring the Suit within limitation. The Plaintiff has
sought to contend that "fraud" was played upon the Plaintiff. He has
placed reliance upon Section 19 of the Contract Act, 1872, which
provides that a contract which is vitiated by fraud makes the contract
'voidable' at the instance of the innocent party. Thus, it is for the
Plaintiff to avoid the contract by seeking its cancellation under Section
31 of the Specific Relief Act. In the present case the Plaintiff would
have to seek cancellation of the documents being the Conveyance
Deeds which would necessarily have to be filed within three years from
the date of knowledge of the alleged fraud. The Plaintiff had
knowledge of the alleged fraud not only from the execution of the
Conveyance Deeds dated 31.12.2013 but had clear knowledge of the
fraud as admitted by him both in his reply dated 29.08.2016 to the
Notice dated 22.08.2016 received from the City Survey Officer and in
his affidavit in reply dated 14.02.2017 to the Chamber Summons
preferred by Defendant Nos.10 to 12 in their Suit before the City Civil
Court.
23 Mr. Lohia has submitted that the case of the Plaintiff in the
plaint is that the right to sue first accrued in favour of the Plaintiff so
Waghmare 16/60
IAL.2566.22a wt....doc
as to seek cancellation of the impugned Conveyance Deeds as the
Defendants infringed upon the rights of the Plaintiff of settled
possession and of ownership of the suit properties. He has submitted
that the plea for possession sought in the plaint can be of no assistance
to the Plaintiff as much as the plea of possession is consequential upon
the relief of cancellation/void ab initio as the case may be. The Plaintiff
cannot seek possession if the Plaintiff fails to seek
cancellation/declaration that the Conveyance Deeds are void ab initio.
Thus, if the primary relief/main cause of action in respect of contract
being void/liable to be cancelled is barred by limitation the
consequential relief can never be granted and cannot save limitation.
24 Mr. Lohia has submitted that the Plaintiff cannot rely upon
his contention that the consideration was not paid by Defendant Nos.1
to 7 and such out right rejection arose in November, 2021, which
consideration was promised under the Memorandum of Understanding
dated 11.11.2008. He has submitted that under said Memorandum of
Understanding, it was clearly contemplated that balance payment
would be made within 11 months from the execution of Memorandum
of Understanding. Thus, the cause action on the Memorandum of
Understanding if any, arose post 11 months from execution. He has
accordingly submitted that there is no merit in the Plaintiff's plaint on
Waghmare 17/60
IAL.2566.22a wt....doc
when the cause of action arose. The Suit is clearly barred by the law of
limitation.
25 Mr. Mayur Khandeparkar, learned Counsel on behalf of
Defendant Nos.2, 5, 6 and 7 has made submissions. He has relied
upon the facts as well as well settled principles of a Court dealing with
an application for rejection of plaint under Order VII Rule 11 of the
Code of Civil Procedure, 1908. He has relied upon the decision of the
Supreme Court in Raghwendra Sharan Singh v. Ram Prasanna Singh
(dead) by Legal Representatives (2020) 16 SCC 601, in support of his
submission that the Court can examine not only the plaint but also the
documents annexed and referred to in the plaint for the purpose of
ascertaining the genesis of dispute of and/or triggering point of right
to sue/cause of action for the purpose of passing appropriate orders in
an application filed for rejection of the plaint under Order VII Rule 11
of the Code of Civil Procedure. He has submitted that the plaint as
framed and filed is devoid of material particulars in context of
allegation of fraud. In terms of Articles 58 and 59 of the Limitation
Act, a Suit seeking declaration and/or cancellation of Deeds of
Conveyance dated 31.12.2013 was required to be filed on or before
three years from the date of execution thereof. He has relied upon the
well settled law in that context. He has also placed reliance upon
Waghmare 18/60
IAL.2566.22a wt....doc
Section 19 of the Contract Act which provides when consent to an
agreement is caused due to coercion, fraud or misrepresentation, such
agreement is voidable at the option of the party, whose consent was so
caused. He has submitted that in the present case, the Plaintiff had at
no point of time elected to render the Deeds of Conveyance as void by
his acts pursuant thereto. The Plaintiff has in fact not only received
valuable consideration, aggregating to a sum of Rs.96,52,116/- under
the Deeds of Conveyance, but has acted thereupon by handing over
possession of the suit properties to the purchasers.
26 Mr. Khandeparkar has submitted that the Plaintiff has not
sought specific performance of the Memorandum of Understanding
dated 11.12.2008 on the basis of which the Plaintiff has claimed that
the Deeds of Conveyance were executed. It is the case of Defendant
No.1 that the said Memorandum of Understanding has in fact been
cancelled vide letter dated 02.09.2010. However, there has been no
attempt to refund or return the consideration under the Deeds of
Conveyance.
27 Mr. Khandeparkar has further submitted that the Plaintiff
is deemed to have knowledge of the Deeds of Conveyance at least since
their registration on 20.02.2014 as they are registered documents,
Waghmare 19/60
IAL.2566.22a wt....doc
having regard to Section 3 of the Transfer of Property Act and Section
17 of the Limitation Act. He has accordingly submitted that the
captioned suit is clearly barred by the law of limitation and the plaint
be rejected under Order VII Rule 11 (d) of the Code of Civil Procedure.
28 Mr. Chetan Kapadia, learned Counsel appearing for the
Plaintiff has submitted that from a true and correct reading of the
plaint as a whole, it is clear that the captioned Suit has been filed on
the cause of action of misrepresentation by Defendant Nos.1, 3 and 4
to the Plaintiff and Defendant Nos.13, 14 and 15 that the documents
executed in 2013 were in fact fresh Memorandum of Understanding
and documents in aid thereof in furtherance of Memorandum of
Understanding dated 11.12.2008. The purported Deeds of Conveyance
dated 31.12.2013 are accordingly void and non est factum. Further
cause of action in the plaint is that the Deeds of Conveyance are void
as they are executed in violation of an injunction order dated
26.11.1982 passed by this Court in Suit No.359 of 1980, which was
later transferred to the City Civil Court. Hence, the cause of action in
the Suit being one for primary relief of possession and for relief of
adjudgment that the Deeds of Conveyance are void ab initio and other
ancillary reliefs based on title.
Waghmare 20/60
IAL.2566.22a wt....doc
29 Mr. Kapadia has submitted that the Plaintiff is illiterate
and can only read and write in his vernacular language i.e. Marathi.
The Plaintiff at best, can only initial and/or write his name in English.
This fact is supported by the Plaintiff and his family members having
affixed their signatures only in Marathi to the documents and that the
plaint is also affirmed by the Plaintiff in Marathi.
30 Mr. Kapadia has thereafter referred to the facts of the case
and has made particular reference to the Memorandum of
Understanding executed on 11.12.2008 between the Plaintiff, his
family members and Original Defendant No.1 which was for a total
consideration of Rs.13.51 crores and which was payable by post-dated
cheques within 11 months and which was also handed over. He has
submitted that cheques aggregating to Rs.5,95,03,212/- between
30.10.2013 to 30.10.2014 were issued by Defendant No.1 in favour of
the Plaintiff and his family members. He has submitted that the
Plaintiff had executed the documents/Deeds of Conveyance with the
understanding that this was in relation to the Memorandum of
Understanding executed in 2008 and for which fresh Memorandum of
Understanding was required to be prepared. He has submitted that the
presence of Defendant Nos.8 to 12 at the Registration Office when the
documents were registered on 20.02.2015 were questioned by the
Waghmare 21/60
IAL.2566.22a wt....doc
Plaintiff and Defendant Nos.13 to 15 upon which they were informed
that the presence of Defendant Nos.8 to 12 was necessary for effective
implementation of the 2008 Memorandum of Understanding and for
which a fresh Memorandum of Understanding has been executed with
them, separately. He has submitted that the Deeds of Conveyance
were registered by fraud, deceit and misrepresentation and this is
borne out from the Deeds of Conveyance. The consideration paid to
the Plaintiff/his family members in respect of the Deeds of Conveyance
by Defendant Nos.10 to 12 is a meager sum of Rs.96,52,116/- as
against a market value of Rs.23,94,19,000/-. He has referred to
certain inconsistencies in the Deeds of Conveyance. In respect of the
one Deed of Conveyance which is pertaining to Suit property No.3
claimed to be purchased by Defendant No.2, the purchase
consideration paid by Defendant No.2 to Defendant Nos.10 to 12 is a
sum of Rs.11,00,00,000/- as against market value of Rs.6,18,24,000/-.
This demonstrates the fraudulent nature of the Deeds of Conveyance.
31 Mr. Kapadia has submitted that after three years of
execution of the Deeds of Conveyance, on or about 14.12.2016, the
Plaintiff was served with the Chamber Summons No.1741 of 2016 in
1980 Suit. The Chamber Summons refers to a settlement. However,
there was no reference to and/or production of any documents, at all.
Waghmare 22/60
IAL.2566.22a wt....doc
He has submitted that it is inconceivable and suspicious as to why
Defendant Nos.10 to 12 would wait for a period of 3 years to prefer
Chamber Summons seeking to place on record the alleged settlement
between the parties and that too without mentioning and/or relying
upon the documents pertaining to any alleged settlement. He has
submitted that it is only in 2017, the Plaintiff was able to obtain copies
of the alleged Conveyance Deeds. The Plaintiff only then became
aware of the contents of the Conveyance Deeds and accordingly filed
police complaint with the concerned police station on 05.06.2017. It is
only upon noticing development activities on suit property since 2018
and the Plaintiff being stopped from entering the suit properties, that
the Plaintiff was constrained to file the present suit seeking possession
of suit properties which ware fraudulently taken away from him.
32 Mr. Kapadia has relied upon the decision of the Supreme
Court in the State of Maharashtra v. Pravin Jethalal Kamdar , (2000) 3
SCC 460 wherein it has been held that a suit seeking declaration of a
void document and seeking possession, would be governed by Article
65 of the Limitation Act since it is not necessary to claim declaration in
respect of a void document. He has also placed reliance upon the
substantive law applicable to the cause of action in the plaint on the
principle of mistake of character and non est factum. These
Waghmare 23/60
IAL.2566.22a wt....doc
decisions are as under :
1) Foaster v. Mackinnon, (L.R.)4 C.P. 704.
2) Jagardeo Singh v. Phuljari & Anr., 1908 SCC OnLine AII
3) Sanni Bibi v. Siddik Husain Munshi, (1918-19) 23 CWN
4) Sarat Chandra Gupta v. Kanai Lal Chakrabarty & Anr.,
(1921-22) 26 CWN 479.
5) Raja Singh & Ors. v. Chaichoo Singh, AIR 1940 Pat 201.
6) Jami Appann v. Jami Venkatppadu & Ors., AIR 1953 Mad
7) Ningawwa v. Byrappa Shiddapa Hireknrabar & Ors., AIR
1968 SC 956.
8) Dularia Devi v. Janardan Singh, 1990 Supp SCC 216.
9) Naranjan Singh v. Ranjit Singh, 2015 SCC OnLine 455.
33 Mr. Kapadia has relied upon aforesaid decisions in support
of his submission that where a man who cannot read/illiterate person
Waghmare 24/60
IAL.2566.22a wt....doc
has a written contract/deed falsely read once to him and he executes
the deed relying on the false reading as being the true substance of the
transaction, his act is wholly void. In other words the documents
would be invalid not merely on the ground of fraud, where fraud exists
but on the ground that the mind of the signer did not accompany the
signature. In other words, that he never intended to sign, and
therefore in contemplation of law never did sign, the contract to
which his name is appended. He has submitted that the Courts have
held that in such case the alleged document/deed was no deed and the
deed being void ab initio did not require to be set aside or cancelled.
34 Mr. Kapadia has also made submissions on the substantive
law i.e. on the principle of a transaction being illegal and void if in
violation of an injunction. He has in support of this submission relied
upon the following authorities :
1) Surjit Singh & Ors. v. Harbans Singh & Ors., (1995) 6
SCC 50.
2) Smt. Savitri Devi v. Civil Judge (Senior Division),
Gorakhpur & Ors. AIR 2003 AII 321.
Waghmare 25/60
IAL.2566.22a wt....doc
3) Keshrimal Jivji Shah & Anr. v. Bank of Maharashtra & Ors.
2004 (3) Mh.L.J. 893.
4) Pralhad Jawale & Ors. v. Sitabai Chander Nikam, 2011
(4) Mh.L.J. 137.
5) Vidur Impex and Traders Private Limited & Ors. v. Tosh
Apartments Private Limited & Ors., (2012) 8 SCC 384.
6) Jehal Tanti & Ors. v. Nageshwar Singh (Dead) through
Lrs., (2013) 14 SCC 689.
7) Shri Prakash Gobindram Ahuja v. Ganesh Pandharinath
Dhonde & Ors., 2016 SCC OnLine Bom 8884.
8) Robust Hotels Private Limited & Ors. v. EIH Limited &
Ors. (2017) 1SCC 622.
9) Edit II Productions v. Standard Chartered Bank & Ors.,
Judgment dated 05.09.2019 passed in Notice of Motion
(L) No.2304 of 2018 in Suit No.461 of 2010.
35 Mr. Kapadia has submitted that when property is
transferred in breach of an order of injunction and/or order of status
Waghmare 26/60
IAL.2566.22a wt....doc
quo, it is held by the Courts that there is no transfer in the eyes of law
and transfer is void ab initio.
36 Mr. Kapadia has further made submissions on Article 65 of
the Limitation Act which according to him is applicable as well as
relied upon judgments thereon and Order VII Rule 11 of the Code of
Civil Procedure as follows :
1) Sopanrao & Anr. v. Syed Mehmood & Ors., (2019) 7 SCC
2) Salim D. Agboatwala & Ors. v. Shamalji Oddhavji Thakkar
& Ors. 2021 SCC OnLine SC 735.
3) C Mohammad Yunus v. Syed Unnissa & Ors., AIR 1961 SC
4) Daya Singh & Anr. v. Gurdev Singh (Dead) By Lrs. & Ors.
(2010) 2 SCC 194.
5) Chhotanben & Anr. v. Kiritbhai Jalkrushnabhai Thakkar &
Ors. (2018) 6 SCC 422.
6) P.V. Guru Raj Reddy & Anr. v. P. Neeradha Reddy & Ors.,
(2015) 8 SCC 331.
Waghmare 27/60
IAL.2566.22a wt....doc
7) Pankaja & Anr. v. Yellappa (Dead) By Lrs. & Ors., (2004)
6 SCC 415.
37 Mr. Kapadia has submitted that in view of the present suit
being a suit for possession, Article 65 of Limitation Act provides for a
period of limitation of 12 years from the date when possession of the
land became adverse to the Plaintiff. Merely because one of the reliefs
sought is of declaration that will not mean that the outer limitation of
12 years is lost. He has placed reliance in this context on the
aforementioned decision of the Supreme Court in Sopanrao & Anr.
(supra).
38 Mr. Kapadia has also relied upon the aforementioned
decisions which are on the well settled principles laid down on
rejection of a plaint under Order VII Rule 11. The Supreme Court in
Salim D. Agboatwala (supra) has held this to be a drastic power
conferred on the Court to terminate a civil action at the threshold.
Therefore, 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.
39 Mr. Kapadia has submitted that there is no merit in the
application under Order VII Rule 11 as the Defendants have sought to
Waghmare 28/60
IAL.2566.22a wt....doc
go into the merits of the dispute. He has submitted that an application
filed under Order VII Rule 11 of the Code of Civil Procedure does not
require the Plaintiff to prove his case on merits or for an adjudication
on merits. All that the Court has to see is what is pleaded by the
Plaintiff to ascertain the cause of action in the plaint. In the present
case, the Plaintiff has lost possession of the suit properties sometime
around October, 2018. The Applicant, in their Interim Applications
have contended that the Plaintiff lost possession in December, 2013
when the Deeds of Conveyance were executed. In either case, the
present Suit having been filed in December, 2021 is well within the
period of limitation which under Article 65 of Limitation Act is 12
years from the date of loss of possession of the suit properties. He has
submitted that the Deeds of Conveyance itself are illegal and void ab
initio in view of the settled law and hence, not required to be cancelled
and/or set aside. The Deeds of Conveyance according to the
substantive law relied upon having been executed on the principle of
mistake of character and non est factum, would be void ab initio.
Further, according to the substantive law transaction is illegal and void
ab initio, if it is in violation an order of injunction.
40 Mr. Engineer, Mr. Lohia and Mr. Khandeparkar have on
behalf of the respective Defendants made submissions in rejoinder.
Waghmare 29/60
IAL.2566.22a wt....doc
They have submitted that the Law laid down by the Supreme Court
makes a clear distinction between "fraud with regard to the character
of a document" and "fraud with regard to the contents of document".
The legal effect/consequence of the two is completely different. They
have submitted that "fraud with regard to the character of document"
covers cases where a person executed a document thinking that it
would be one kind/type such as a power of attorney or a lease of some
property, but finds that, in fact, the document was a sale deed or a gift.
Therefore, the nature or type of document was completely different
from what was intended. Whereas in the case of fraud with regard to
contents of a document, these are cases where a person wanted to gift
one property but discovers that, in fact, more properties have been
gifted under the document, or where the consideration figure agreed
upon is fraudulently altered or the purchaser of the property is
someone else. They have submitted that it is settled law that if there is
"fraud with regard to the contents of a document", then the document
is only voidable and the Plaintiff would have to sue for cancellation of
those documents. It is only in the case of "fraud with regard to
character of a document" that it would not be necessary to sue for
cancellation of document as the document itself is invalid and void ab
initio. They have submitted that this distinction is required to be kept
Waghmare 30/60
IAL.2566.22a wt....doc
in mind. It is their contention that in the present case, assuming
without admitting that there is any fraud, the Plaintiff has himself
pleaded that the fraud was only with regard to the contents of the
document. This is apparent from paragraph 29 of the plaint as well as
the subsequent paragraphs 33 and 35 of the plaint.
41 The learned Counsel have submitted that it is in fact the
case of the Plaintiff that he had entered into settlement with Defendant
Nos.10 to 12 and executed conveyances in their favour and it was only
because the entire consideration had not been paid that the Plaintiff
has alleged "fraud". This is further apparent from the police complaint
dated 05.06.2017 made by the Plaintiff which is annexed at Exhibit-M
to the plaint, wherein the Plaintiff has stated that "... once again
believing upon the said accused, we executed the documents not
knowing the contents of the same and that the said Agarwal also
signed the documents". It is further borne out from paragraphs 27 and
28 of the Plaint that the Plaintiff thought that he was executing the
documents in furtherance of and for transferring his right, title and
interest in favour of Defendant Nos.1 to 7 and the Plaintiff thought
that even Defendant Nos.8 to 12 are also transferring their rights in
favour of Defendant Nos.1 to 7 simultaneously. It is clear that the
Plaintiff was of the view that he was executing the documents, by
Waghmare 31/60
IAL.2566.22a wt....doc
which he was transferred his rights in the property in favour of
Defendant Nos.1 to 7. The Plaintiff was thus conscious that the
character of the documents was one, by which he was to receive
consideration and he was to transfer his right, title and interest in
favour of another. That even assuming without admitting that what
has been stated in the Plaint is correct, at the highest, the Plaintiff did
not receive the full consideration and he thought that he was going to
transfer his rights in the suit property to Defendant Nos.1 to 7. This, at
best, can only be fraud on contents and is not fraud on character of the
documents, because the Plaintiff's intention was to transfer the
property for consideration to a third party.
42 The learned Counsel thereafter dealt with the decisions
relied upon by Mr. Kapadia in support of his submissions on behalf of
the Plaintiff. They have submitted that the decision relied upon by the
Plaintiff namely, Jagardeo Singh v. Phuljari (supra) is misplaced as it
does not draw a distinction between fraud of character and fraud of
contents and is contrary to decision of the Supreme Court in
Ningawwa v. Byrappa Shiddapa (supra) and Dularia Devi v. Jonardan
Singh (supra) and in fact supports the Defendants as it states that if
there is fraud as to the contents of the document, the document is not
void ab initio. This judgment is also contrary to the law as laid down
Waghmare 32/60
IAL.2566.22a wt....doc
in the case of Abdul Rahim v. Abdul Zabar (supra) where it is held that
even if a transaction is void or voidable, the party must sue for
cancellation. Accordingly, the judgment in Jagardeo Singh (supra) is
not good law and cannot be relied upon.
43 They have further submitted that the other decisions relied
upon by the Plaintiff namely Sanni Bibi (supra); Appanna v.
Venkatappa (supra); Naranjan Singh (supra), Sarat Chandra Gupta
(supra) are all decisions which are with regard to fraud on character of
the document where the Plaintiff thought he was executing a particular
document, when actually he was executed an entirely different
document. In Sanni Bibi (supra) the Plaintiff thought he was
executing a deed for maintenance for a term of three years, when what
actually he was executing was a sale deed. In this judgment, the
Calcutta High Court in the context of fraud as to the contents of the
document has held that 'There can be no doubt that when a person
seeks to recover property against an instrument executed by himself or
one under whom he claims, he must first obtain cancellation of the
instrument and that the three years rule indicated by, Article 91 applies
to any Suit brought by such person'. Thus, these findings of the
Calcutta High Court supports the case of these Defendants, as there is
no fraud on character in the facts of the present case. In the case of
Waghmare 33/60
IAL.2566.22a wt....doc
Appanna v. Venkatappa (supra) the Plaintiff thought he was executing
a Power of Attorney in favour of the Defendants, authorizing them to
manage the Plaintiff's estate. However, this, in fact, turned out to be a
gift deed, by which the Plaintiff had gifted away his properties in
favour of the Defendants. Thus, this was a clear case of fraud with
regard to the character of the documents which is entirely different
from the facts of the present case. In Naranjan Singh (supra) the
Plaintiff had not even executed the document and that his brother had
fraudulently sold the suit land by impersonating him. These facts are
entirely different from the facts of the present case. In Sarat Chandra
Gupta (supra) the Plaintiff signed a document under a belief that she
was signing a power of attorney, whereas, in fact, she executed a deed,
thereby alienating the property from herself to the Defendants. Thus,
this was also clear case of fraud with regard to the character of the
document and accordingly the Calcutta High Court held that this is not
a case where the contract was entered into by fraud with regard to the
contents of the document.
44 The learned Counsel have further submitted in rejoinder
that the decision of the Patna High Court in Raja Singh (supra) relied
upon by the Plaintiff which holds that if a party signs the document
based on misrepresentation as to its contents, there would be no real
Waghmare 34/60
IAL.2566.22a wt....doc
execution and plea of non est factum would succeed and the document
would be void ab initio is not a good law. This is contrary to the
decision of the Supreme Court in Ningawwa (supra) and Dularia Devi
(supra) and is accordingly impliedly overruled. In Ningawwa (supra)
the Supreme Court was considering a case where the wife was the
owner and she intended to gift two of the plots to her husband.
However, in the gift deed, all four plots were gifted by the wife to her
husband. It was held by the Supreme Court that though the wife did
not intend to gift away two out of four properties, there was no fraud
with regard to the character of the documents, but it was merely fraud
with regard to the contents of the documents and hence, the gift deed
was voidable and accordingly, a suit would have to be filed within the
time prescribed under Article 95 of the Limitation Act (which is now
Article 59 of the Limitation Act).
45 In Dularia Devi (supra) the Plaintiff believed that she was
executing a gift deed in favour of her daughter, but in fact, the
property was sold. Relying upon the decision in Ningawwa (supra) the
Supreme Court held that where there is fraud with regard to the
character of the documents, the contract is void. The Supreme Court
has reaffirmed that if the fraud is not on character, but only with
regard to the contents, then it would only be voidable. The learned
Waghmare 35/60
IAL.2566.22a wt....doc
Counsel have submitted that the ratio of this judgment applies to the
facts of the present case, as here there is no fraud with regard to the
character of the documents. They have accordingly submitted that at
the highest, assuming the Plaintiff's case of fraud with regard to the
contents of the document is correct, it is well settled law that for the
Plaintiff to recover possession of property, the Plaintiff must seek
cancellation of the instrument under which the property was
transferred viz. the Deeds of Conveyance in the present case i.e.
within the period of three years from the knowledge of the fraud as
provided in Article 59 of the Limitation Act. At the very latest three
years run from 14.02.2017 i.e. by 15.02.2020 and the suit filed in
December, 2021 is accordingly barred by limitation.
46 The learned Counsel have thereafter dealt with the
Plaintiff's contention that the Conveyance Deeds are void ab initio as
they were executed in violation of the order of injunction dated
26.11.1982. It is submitted by the learned Counsel for the respective
Defendants that the case of the Plaintiff is entirely misconceived as the
order of injunction was passed in a Suit filed by the predecessor of
Defendant Nos.10 to 12 and that the order of injunction was in favour
of Defendant Nos.10 to 12 and did not operate against them. Hence
there is no embargo on the Defendant Nos.10 to 12 or any of their
Waghmare 36/60
IAL.2566.22a wt....doc
nominees from entering into the Conveyance Deeds with the Plaintiff.
They have submitted that even assuming that the order of injunction
applied, a sale in violation of an order of injunction is not void ab
initio. This has been held by the Supreme Court in the case of
Thompson Press (India) Limited v. Nanak Builders and Investors,
reported in 2013 5 SCC 397 at paragraph 53. They have submitted
that the judgments relied by the Plaintiff to the contrary have been
either impliedly or expressly overruled by the said decision of the
Supreme Court.
47 The learned Counsel have submitted that order of
injunction obtained by a Plaintiff, in its favour to protect the suit
property cannot be held to operate against the Plaintiff for whose
protection the order was passed. This would tantamount to a complete
travesty if in the present case the injunction order obtained by the
predecessor of Defendant Nos.10 to 12 and upon his demise,
Defendant Nos.10 to 12 who are Plaintiffs in the suit before the City
Civil Court is to operate against them. The conveyances sought to be
impugned in the present Suit are not in violation of the injunction
order as the injunction order did not operate against Defendant Nos.10
to 12 herein or their nominee. It has been clearly held by the Supreme
Court in Thompson Press (supra) that where a sale deed is executed in
Waghmare 37/60
IAL.2566.22a wt....doc
breach of injunction issued by competent Court, there is no reason why
the breach of any such injunction should render the transfer whether
by way of an absolute sale or otherwise ineffective. The learned
Counsel for respective Defendants have contended that in fact the
Conveyance Deeds in the present Suit were not executed in violation of
the order of injunction and without prejudice to this contention,
assuming that the Conveyance Deeds was executed in violation of the
injunction order, the same would not be a void ab initio sale and would
be valid subject to any directions which this Court may issue against
the vendors.
48 The learned Counsel for the respective Defendants have
also dealt with the Plaintiff's contention that since the Plaintiff is
seeking possession of the suit properties, the period of limitation for
filing the Suit is 12 years under Article 65 of the Code of Civil
Procedure and hence the present Suit is not barred by the law of
limitation. They have submitted that this contention of the Plaintiff
and the judgments relied upon in support thereof would apply where
the cases are under Articles 58 and 65 of the Limitation Act. They are
all cases where relief sought were for possession and a declaration was
sought. None of these judgments are cases where the right to
possession was consequential or dependent upon the setting aside of a
Waghmare 38/60
IAL.2566.22a wt....doc
document. These judgments are completely distinguishable on facts.
49 The learned Counsel for the respective Defendants have
submitted that in the present case it is the plea of the Plaintiff that
there is fraud as to the contents of the Deeds of Conveyance and that
the Plaintiff had knowledge of the fraud by 22.08.2016 and/or the
very latest by 23.02.2017. In view thereof, the Suit for cancellation of
Deeds of Conveyance must be filed latest by 15.02.2020. The
contention of the Plaintiff that the impugned Deeds of Conveyance are
void ab intio, is contrary to the well settled law that where there is no
fraud as to the character of the documents but only fraud as to the
contents of the documents, the Deeds of Conveyance would be
voidable and would require cancellation and for which Article 59 of
the Limitation Act is applicable. Thus, the Suit for cancellation would
have to be filed in the facts of the present case latest by 15.02.2020
and the Suit admittedly was filed only on 14.12.2021 and thus is
barred by limitation. They have submitted that this Court under Order
VII Rule 11 is mandated to reject the plaint since the Suit is barred by
law of limitation under Order VII Rule 11 (d).
50 After the judgment was reserved in the present matter on
11.04.2022, Mr. Chetan Kapadia had moved the Court on 07.06.2022
Waghmare 39/60
IAL.2566.22a wt....doc
by placing reliance on the recent decision of the Supreme Court in
Veena Singh (Dead) v. District Registrar/Additional Collector (F/R) ,
2002 SCC OnLine SC 593, decided on 10.05.2022. Mr. Kapadia has
placed reliance on paragraph 78 of the said decision wherein it is held
that "execution' of a document does not stand admitted merely
because a person admits to having signed the document. Adopting a
contrary interpretation would unfairly put the burden upon the person
denying execution to challenge the registration before a Civil Court or
a writ court, since registration will have to be allowed once the
signature has been admitted. Mr. Kapadia by placing reliance on this
decision submitted that the Plaintiff in the present case merely by
signing the deeds of Conveyance has not admitted to having executed
the document as the Plaintiff was not aware of the contents of the
document.
51 The learned Counsel appearing for the Defendants have
distinguishing the decision of the Supreme Court in Veena Singh
(supra) on the ground that the Supreme Court in that decision was
considering a case where the Appellant has sought action to be taken
by the Sub-Registrar for forgery alleged to have been committed by the
2nd Respondent on the ground that the signature of the Appellant was
forcibly taken on the sale deed thereby conveying the land in favour of
Waghmare 40/60
IAL.2566.22a wt....doc
the 2nd Respondent and having the sale deed registered. The Sub-
Registrar had by order declined to register the sale deed which was
thereafter challenged and the order of the Sub-Registrar was set aside
by the District Registrar. The Appellant had challenged the order of
the District Registrar before the Allahabad High Court. Writ Petition
was dismissed by the Allahabad High Court and the Appellant was
directed to move the Civil Court for declaration that sale deed had
been obtained by fraud and nullity. In Appeal, the matter was heard
by the Supreme Court. The Supreme Court in the context of the facts
before it arrived at the finding at paragraph 78 of the said decision
namely that execution of a document does not stand admitted merely
because a person admits to having signed the document. Considering
that the burden would then be upon the person denying execution to
challenge the registration before a civil court or a writ court since
registration will have to be allowed once the signature has been
admitted. The Supreme Court allowed the Appeal and set aside the
Judgment of the Single Judge of the Allahabad High Court and the
order passed by the District Judge.
52 The learned Counsel appearing for the Defendants have
submitted that in the present case there is no issue as to the signature
of the Plaintiff having been forged and/or forcibly taken. The issue
Waghmare 41/60
IAL.2566.22a wt....doc
raised in the plaint is only insofar as the Plaintiff being unaware of the
contents of the document. They have submitted that it is well settled
merely because there is fraud as to the contents of the document that
does not make the document void but voidable and will have to be
avoided by the Plaintiff seeking the setting aside of the document.
53 Having considered the submissions, it is necessary to note
the well settled principles laid down by the Supreme Court for
deciding applications under Order VII Rule 11 which are as under :
(i) The Court must read the Plaint as a whole and that the
substance and not the form must be ascertained;
(ii) The Court must look at the documents that are annexed
to the plaint;
(iii) The Court must ascertain if the averments made in the
plaint are contrary to settled law or judicial dicta for deciding
whether a case for rejecting the plaint at the threshold is made
out;
(iv) The Court must not allow the Plaintiff to take advantage
of clever drafting, and circumvent the provision of law which
bars the Suit.
Waghmare 42/60
IAL.2566.22a wt....doc
(v) Order VII Rule 11 is mandatory and if in the event of
meaningful reading of the plaint the Suit is found to be barred
by any law, the Court shall dismiss the Suit.
54 These principles have also been enunciated in the decision
of the Supreme Court in Dahiben (supra), upon which it has been held
at sub-para 23.15 as under :
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."
55 It has further being held by the Supreme Court in Sree
Surya Developers & Promoters (supra) that the Plaintiff cannot be
allowed to circumvent the provision by means of clever drafting so as
to avoid mention of those circumstances, by which the Suit is barred by
the law of limitation. In that case the Supreme Court considered that
the Plaintiff had sought multiple reliefs and by clever drafting wanted
to get his Suit maintainable which otherwise would not have been
Waghmare 43/60
IAL.2566.22a wt....doc
maintainable in questioning the compromise decree. The Plaint was
accordingly rejected under Order VII Rule 11 (d) of the Code of Civil
Procedure. The Supreme Court in Sree Surya Developers (supra) at
paragraphs 32 and 33 held thus :
"32. In the case of Ram Singh v. Gram
Panchayat Mehal Kalan, (1986) 4 SCC 364, this
Co suit is barred by any law, the plaintiff cannot
be allowed to circumvent that provision by
means of clever drafting so as to avoid mention
of those circumstances, by which the suit is
barred by law of limitation.
33. If we consider the reliefs of declaration of
title, recovery of possession, cancellation for
DGPA and Deed of Assignment- cum-DGPA, the
said reliefs can be granted only if the
Compromise Decree dated 13.01.2016 passed
in O.S. No. 1750 of 2015 is set aside.
Therefore, by asking such multiple reliefs, the
plaintiff by clever drafting wants to get his
suit maintainable, which otherwise would not
be maintainable questioning the Compromise
Decree. All the aforesaid reliefs were subject
matter of earlier suits and thereafter also
subject matter of O.S. No. 1750 of 2015 in
which the Compromise Decree has been passed.
Therefore, it is rightly held by the Trial Court
Waghmare 44/60
IAL.2566.22a wt....doc
that the suit in the present form and for the
reliefs sought would be barred under Order
XXIII Rule 3A CPC and therefore the Trial Court
rightly rejected the plaint in exercise of powers
under Order VII Rule 11(d) of the CPC. The
High Court has erred in setting aside the said
order by entering into the merits of the validity
of the Compromise Decree on the ground that
the same was hit by Order XXXII Rule 7 CPC,
which was not permissible at this stage of
deciding the application under Order VII Rule
11 CPC and the only issue which was required
to be considered by the High Court was whether
the suit challenging the Compromise Decree
would be maintainable or not."
56 The present Interim Applications which have been taken
out by the respective Defendants seek rejection of the plaint under
Order VII Rule 11 (d) on the ground that the Suit is barred by
limitation. The arguments on behalf of the Defendants have proceeded
on the premise that the Plaintiff in the present Suit has sought various
reliefs including the prayer for order and decree that the transfer of the
Suit property by the Conveyance Deeds dated 31.12.2013 in respect of
the suit properties being on the face of injunction order dated
26.11.1982 passed in Notice of Motion No.385 of 1980 by this Court in
Waghmare 45/60
IAL.2566.22a wt....doc
Suit No.7420 of 1980 which is now pending before the City Civil Court
are ineffective and void ab initio and possession of the suit property be
restored in favour of the Plaintiff. Further relief has been sought for an
order and declaration that the Conveyance Deeds with regard to the
suit properties are illegal, null, non-est and void in law due to fraud,
cheating, breach of trust and misrepresentation, without consideration
and possession of suit properties be restored in favour of the Plaintiff.
Thereafter, relief has been sought for an order and decree that the
Defendants found in possession of the suit properties be directed to
handover possession of the suit properties to the Plaintiff. In addition
compensation has been sought as well as mesne profit from the date of
filing of the suit till the time of handing over of vacant, absolute and
quiet possession of suit properties to the Plaintiff. It can be seen from
the averments in the plaint, in particular paragraphs 27, 28, 29, 33 and
35 that the Plaintiff had challenged the impugned Conveyance Deeds
on two main grounds one that the Plaintiff thought he was executing
documents in furtherance of and for transferring his right, title and
interest in favour of Defendant Nos.1 to 7 and thought that even
Defendant Nos.8 to 12 are also transferring their rights in favour of
Defendant Nos.1 to 7 simultaneously. The other ground of challenge
to the Conveyance Deeds is that though Defendant Nos.10 to 12
Waghmare 46/60
IAL.2566.22a wt....doc
approached the Plaintiff for settlement and agreed to pay consideration
price for purchasing the suit properties, Defendant Nos.10 to 12 had
not paid full consideration and hence there was no settlement.
57 In paragraph 29 of the plaint, the Plaintiff has stated that
there was fraud and misrepresentation with regard to the 'contents of
the documents'. Paragraph 29 of the plaint is material and is
accordingly reproduced :
"29. The Plaintiff having been misrepresented and
fraudulently made to believe about the contents of the
document executed the alleged impugned Conveyance
Deeds as to be Memorandum of understanding in favor of
Defendant Nos.1 to 7. The Plaintiff was led to believe
that the documents registered are nothing but a
Memorandum of Understanding and documents to further
implementation thereof. In the circumstances, the alleged
impugned Conveyance Deeds were executed by the
Plaintiff and the Defendant No.13 to 15 without even
knowing the contents, only on account of
misrepresentation caused and illegal, fraudulent, coercive
and unethical tactics deployed by Defendants 1 to 7. The
Waghmare 47/60
IAL.2566.22a wt....doc
Plaintiff submits that all throughout the Plaintiff did not
know the content therein and hence was not aware of and
ramifications / repercussions of signing the alleged
impugned Conveyance Deeds. It is pertinent to note that
the Plaintiff was made to understand that the
Memorandum of Understanding dated 11th December,
2008 was being in some form in order to give sanctity to
the understanding and commitment brought out by
Memorandum of Understanding dated 11th December,
2008. The Plaintiff never knew that the other Defendant
Nos. 8 to 12 were also signing the same document and
getting suit properties transferred in their own name."
(Emphasis supplied)
58 From reading of the plaint, it is apparent that the Plaintiff
was aware that he was executing the documents/Conveyance Deeds to
transfer his rights in the suit property in favour of another. He was thus
conscious that the character of the documents was one, by which he
was to receive consideration and he would to transfer his right, title
and interest favour of another.
Waghmare 48/60
IAL.2566.22a wt....doc
59 Mr. Kapadia, learned Counsel for the Plaintiff has relied
upon decisions of the Courts on fraud as to the character of the
document and in which event the document is void ab initio and not
required to set aside. It is based on these decisions that the Plaintiff has
sought to justify the prayers in the plaint which do not seek
cancellation and/or setting aside of the Deeds of Conveyance on the
ground that the Deeds of Conveyance are itself illegal and void ab
initio. In my view these decisions are wholly inapplicable to the
present case where there is no fraud with regard to the character of the
document.
60 In the law laid down by the Courts including the Supreme
Court, a clear distinction has been made as to the "fraud with regard to
the character of the documents" from that of "fraud with regard to the
contents of the document". It is only in the case of "fraud with regard
to character of documents" where the character of document is
different from what was intended by the party that such document has
been held to be null and void and not required to be set aside.
61 It is in fact clear from the documents annexed to the Plaint
which include the Plaintiff's reply to the City Survey Officer who had
issued notice under Section 150(2) of the Maharashtra Land Revenue
Waghmare 49/60
IAL.2566.22a wt....doc
Code, 1966 that there was no fraud with regard to the character of the
documents. In the reply dated 29.08.2016 to the said notice issued by
the City Survey Officer, the Plaintiff had objected to the proposed
amendment in the record of rights on the basis that the Plaintiff and
other co-owners had not received full compensation of the land. It was
stated that in such situation the Agarwal family, the buyers of the land
and property on the basis of the Conveyance Deeds had not received
further ownership of the land. It is clear that the Plaintiff had not
disputed that he had voluntarily sold the land to the Agarwal family.
The only objection being that the Agarwal family had not paid the
Plaintiff full consideration. It is further clear from the affidavit in reply
dated 14.02.2017 to Chamber Summons No.1741 of 2016 filed by
predecessor of Defendant Nos.10 to 12 in their Suit, that the Plaintiff
has admitted that Defendant Nos.10 to 12 approached the Plaintiff for
settlement of the issue in the suit and agreed to pay the consideration
price, however having not paid entire consideration price there was no
settlement whatsoever, although the Plaintiff got executed certain
documents by fraud in their favour. The Plaintiff has in this affidavit in
reply to the Chamber Summons has in fact stated that a Suit for
declaration that the Conveyance Deeds are null and void would be
filed. Thus, the Plaintiff was aware of the purpose for which the
Waghmare 50/60
IAL.2566.22a wt....doc
Conveyance Deeds have been executed and which transferred rights of
the suit property. The only objection being that full consideration was
not paid to them. It accordingly appears that though the averments in
the Plaint proceed on the premise that the Plaintiff was not aware of
the contents of the Conveyance Deeds and/or that the transfer of the
Suit was in favour of Defendant Nos.10 to 12, the documents annexed
to the Plaint which have been adverted to above make it clear that the
Plaintiff in fact had knowledge of the contents of the Conveyance
Deeds at least on receiving notice dated 22.08.2016 from the City
Survey Officer as borne out from the reply of the Plaintiff to the notice
as well as from the affidavit in reply to Chamber Summons No.1741 of
2016 that the Conveyance Deeds were executed by the Plaintiff to
transfer as rights in the suit property to Defendant Nos.10 to 12.
62 In my view, if the Plaintiff were at all aggrieved by the
Conveyance Deeds as to there being fraud as to the contents of the
Conveyance Deeds, the Plaintiff was obligated to file a Suit for setting
aside of the conveyance deeds and for which limitation of three years
under Article 59 of the Limitation Act would be applicable. At the
latest the present suit should have been filed within a period of three
years from such knowledge which would be at the latest three years
from 14.02.2017 when the Plaintiff had filed the affidavit in reply to
Waghmare 51/60
IAL.2566.22a wt....doc
the Chamber Summons and the three years period expired on
15.02.2020. It is clear from the decisions relied upon by the Plaintiff,
in particular Ningawwa (supra) and Dularia Devi (supra) that where
there is no fraud with regard to character of the documents, but fraud
with regard to contents of the documents, the documents are voidable
and accordingly Suit will have to be filed within the time prescribed
under Article 59 of the Limitation Act. It has been held by the
Supreme Court in Ningawwa (supra) at paragraphs 4 and 5 as under :
"4. ... It is well established that a contract or other
transaction induced or tainted by fraud is not void, but
only voidable at the option of the party defrauded. Until it
is avoided, the transaction is valid, so that third parties
without notice of the fraud may in the meantime acquire
rights and interests in the matter which they may enforce
against the party defrauded."
"5. The legal position will be different if there is a
fraudulent misrepresentation not merely as to contents of
the document but as to its character. The authorities make
a clear distinction between fraudulent misrepresentation
as to character of the document and fraudulent
misrepresentation as to contents thereof. With reference
Waghmare 52/60
IAL.2566.22a wt....doc
to the former, it has been held that the transaction is void,
while in the case of the latter, it is merely voidable.
63 Mr. Kapadia on behalf of the Plaintiff made submissions on
the substantive law on the principle of a transaction being illegal and
void if in violation of an injunction. He has submitted that in the
present case the Conveyance Deeds were executed in violation of the
order of injunction dated 26.11.1982. This contention of the Plaintiff
cannot be accepted in view of the fact that the order of injunction was
passed in the suit filed by the predecessor of Defendant Nos.10 to 12
and was in favour of Defendant Nos.10 to 12 and did not operate
against them. The Conveyance Deeds transferred the Suit Properties to
Defendant Nos.10 to 12 and thus cannot be held to be breach of the
injunction order which enures in their favour. The Defendant Nos.10
to 12 had admittedly approached the Plaintiff for settlement of the Suit
filed by their predecessor which is pending before the City Civil Court
and for which Conveyance Deeds were executed by which the rights of
the Suit Properties were transferred by the Plaintiff to Defendant
Nos.10 to 12. The Defendant Nos.10 to 12 had taken out Chamber
Summons No.1741 of 2016 in their Suit which was filed for specific
performance of agreement dated 30.06.1974 by which the predecessor
of the Plaintiff had agreed to sell the Suit properties to the predecessor
Waghmare 53/60
IAL.2566.22a wt....doc
of Defendant Nos.10 to 12. It was in this Chamber Summons that
Defendant Nos.10 to 12 stated that the Plaintiff referred to as the Mali
family had settled their disputes and necessary documents have been
executed to record the settlement. Thus, it is clear that there is no
violation of the injunction order dated 26.11.1982 as the Conveyance
Deeds transferring the Suit Properties to Defendant Nos.10 to 12 were
by way of settlement of the disputes between Defendant Nos.10 to 12
and the Plaintiff in the Suit filed by the predecessor of Defendant
Nos.10 to 12.
64 Presuming that the Plaintiff is right in contending that the
order of injunction applied and the conveyance deeds were executed in
violation of an injunction order, it has been held in Thompson Press
(India) Ltd. (supra) that a breach of any injunction order would not
render the transfer by way of absolute sale or otherwise ineffective. In
this context it is necessary to set out paragraph 53 of the said decision
which is as under :
"53. There is, therefore, little room for any doubt that
the transfer of the suit property pendente lite is not void
ab initio and that the purchaser of any such property takes
the bargain subject to the rights of the plaintiff in the
Waghmare 54/60
IAL.2566.22a wt....doc
pending suit. Although the above decisions do not deal
with a fact situation where the sale deed is executed in
breach of an injunction issued a competent court, we do
not see any reason why the breach of any such injunction
should render the transfer whether by way of an absolute
sale or otherwise ineffective. The party committing the
breach may doubtless incur the liability to be punished for
the breach committed by it but the sale by itself may
remain valid as between the parties to the transaction
subject only to any directions which the competent court
may issue in the suit against the vendor."
(emphasis supplied)
65 It has been held by the Supreme Court that a sale even in
violation of an injunction order may remain valid as between the
parties to the transaction subject to any directions which the
competent Court may issue in the suit against the vendor. Though
there are decisions of the Supreme Court as well as of this Court to the
contrary, they have not considered the decision of the Supreme Court
in Thompson Press (supra). However, it would not be necessary to
consider whether the other decisions are either impliedly overruled or
Waghmare 55/60
IAL.2566.22a wt....doc
per incurium, considering the fact that the conveyance deeds in the
present case cannot be held to be in violation of injunction order
particularly when the transfer of the Suit Properties by way of the
Conveyance Deeds are in favour of Defendant Nos.10 to 12, for whose
benefit the injunction order was passed.
66 Thus, the Plaintiff's contention that since the impugned
Conveyance Deeds are void ab initio there is no need for their
cancellation and Article 59 of the Limitation Act would have no
application cannot be accepted. The prayer in the plaint of possession
clearly would follow the Conveyance Deeds having to be set aside and
absent the setting aside of the Conveyance Deeds, the Suit for
possession cannot stand on its own. Hence, Article 65 which provides
a period of limitation of 12 years in the event the Plaintiff is seeking
possession is not applicable and cannot save the Suit from being barred
by the law of limitation. The decisions relied upon by the Defendants
where the Plaintiff would have to sue for cancellation of the document
and Article 59 of the Limitation Act being applicable are apposite.
67 I have considered the submissions made by the learned
Counsel for the parties on the decision of the Supreme Court in Veena
Singh (supra). In my view the said decision of the Supreme Court is
Waghmare 56/60
IAL.2566.22a wt....doc
inapplicable to the facts of the present case particularly considering
that unlike in the case Veena Singh (supra), in the present case there is
no issue insofar as execution of the document is concerned. The
Plaintiff has in the present case not claimed that his signature was
either forcibly taken or there was forgery committed by the Defendants
in taking his signature. In fact, in the present case the Plaintiff has
admittedly executed the Deed of Conveyance as well as taking part in
its registration. The learned Counsel for the Defendants are in my
view are correct in their submission that in the present case the issue
raised by the Plaintiff in the present Suit is only as to "fraud with
regard to the contents of the document" which in light of the settled
law would require the Plaintiff to seek appropriate relief for setting
aside and/or cancelling the document which in the present case are the
Deeds of Conveyance, and that too within the prescribed period of
three years from their learning of such alleged fraud with regard to the
contents of the document. Further, it is well settled that fraud with
regard to the contents of the document only make a document
voidable and would have to be avoided by the person seeking to do the
same. In my view, the decision of the Supreme Court in Veena Singh
(supra) would not support the Plaintiff's case.
Waghmare 57/60
IAL.2566.22a wt....doc
68 Thus, in my considered view the Suit filed by the Plaintiff
is barred by the law of limitation as it is clear from the averments in
the Plaint read with the documents annexed thereto that the Plaintiff
had knowledge about the alleged fraud by 22.08.2016 and at the very
latest by 14.02.2017. That being so, the Suit for cancellation would
have to be filed by 15.02.2020. The Suit having been filed on
14.12.2021 is clearly barred by the law of limitation. Further, the
averments in paragraphs 60 and 61 as well as paragraphs 60 to 63 of
the plaint whereby the Plaintiff has sought to justify the Suit brought
within limitation on the pretext that cause of action is continuous in
nature, cannot be accepted. The plea of the Plaintiff being
dispossessed of the Suit properties in October, 2018 by Defendant
Nos.1 to 7 and 10 to 12 taking forceful possession of the suit property
and the plea that the right to sue first accrued in favour of the Plaintiff
due to such dispossession likewise cannot be accepted. In fact in
paragraph 63 of the plaint, the Plaintiff has admitted that the right to
Sue accrued in favour of the Plaintiff so as to seek cancellation of the
alleged impugned Conveyance Deeds as the Defendants infringed upon
the rights of the Plaintiff of settled possession and of possession of the
suit properties. Thus, Plaintiff's have in the Plaint admitted that it
would be necessary for the Plaintiff to seek cancellation of the
Waghmare 58/60
IAL.2566.22a wt....doc
impugned Conveyance Deeds. The Plaintiff cannot rely on the
suspension of limitation applicable to Suits by the Supreme Court in its
orders in light of corona virus pandemic since March, 2020. This is in
view of my finding that the present Suit would have to be filed latest
by 15.02.2020. Thus, in my view given the pleadings in the plaint,
documents annexed thereto, the impugned Conveyance Deeds would
have to be set aside given that the Conveyance Deeds were voidable at
the option of the party. Thus, Section 31 of the Specific Relief Act
would be applicable for setting aside of the Conveyance Deeds. The
period of limitation would undoubtedly be a period of three years for
setting aside the impugned conveyance deeds and which period has in
my view expired, prior to the filing of the present Suit. In view
thereof, the Interim Application (L) No.2566 of 2022; Interim
Application (L) No.3696 of 2022 and Interim Application (L) No.4569
of 2022 are required to be allowed.
69 Hence, the following order:
i) The Plaint filed in the captioned Suit is rejected
under Order VII Rule 11(d) on the ground that the Suit
appears from the statement in the plaint to be barred by
the law of limitation.
Waghmare 59/60
IAL.2566.22a wt....doc
ii) Interim Application (L) No.2566 of 2022, Interim
Application (L) No.3696 of 2022 and Interim Application
(L) No.4569 of 2022 are made absolute in the above terms
and disposed of.
iii) There shall be no order as to costs.
(R.I. CHAGLA, J.)
70 The learned Counsel appearing for the Plaintiff has sought
for the judgment to be kept in abeyance. In my view, the judgment
cannot be kept in abeyance considering the findings that the Suit is
clearly barred by the law of limitation and accordingly the Plaint has
been rejected under Order VII Rule 11(d) of the Code of Civil
Procedure, 1908.
71 Thus, the application is rejected.
(R.I. CHAGLA, J.)
Digitally
signed by
WAISHALI
WAISHALI SUSHIL
SUSHIL WAGHMARE
WAGHMARE Date:
2022.07.18
17:55:47
+0530
Waghmare 60/60
