Surakshit Exports Private ... vs Gcg Transglobal Housing Project ...
2004 Latest Caselaw 306 Del

JUDGMENT

Mukundakam Sharma, J.

1. By this order I propose to dispose of two applications, namely, IA Nos.1641/2002, which is filed by the defendant, and IA No.6930/2002, which is filed by the plaintiffs.

2. The said applications have been filed in the present suit which is filed by the plaintiffs seeking for a decree for foreclosure of mortgage or sale or in the alternative for recovery of Rs.2,04,76,219/- together with interest @ 24% per annum from the date of the suit to the date of payment. The suit has been titled by the plaintiffs as "suit by mortgagee for foreclosure or sale and in the alternative recovery of Rs.2,04,76,219/-". It is alleged in the plaint that the plaintiffs advanced a loan of Rs.1,69,95,000/- to the defendant on various dates between 5.7.1999 and 19.11.1999. It is further alleged that the suit property which is approximately 15 acres of land in Village Bamnauli, Tehsil Vasant Vihar, New Delhi was purchased by the defendant under the aforesaid four sale deeds dated 12.10.1999, 18.10.1999, 12.11.1999 and 25.11.1999 and was mortgaged on 22.12.1999 by the deposit of the original title deeds as security against re-payment of the aforesaid loan carrying 24% interest per annum and was to be repaid by 31.3.2000. In the prayer (a) of the plaint it is prayed for passing of a decree for payment of Rs.2,04,76,219/- with interest and expenses as are / or shall be incurred by the plaintiffs on the property and in default foreclosure and possession in pursuance thereto and in the alternative sale of the suit property. It is further alleged that it was agreed between the parties that the title deeds of the land acquired by the defendant shall remain deposited with the nominees of Shri S.D. Sharma, who would be advancing the money, as security by way of equitable mortgage. Statements have been made in the plaint contending that the monies were advanced from time to time and that mortgage was created on 22.12.1999. In its written statement, the defendant has denied that there was any loan. It has denied that the title documents were handed over as security for repayment of the alleged loan and also the allegation that the possession had been handed over as Licensee to the plaintiffs, as alleged. It is the specific case of the defendant in the written statement that Shri S.D. Sharma, who was the property broker has played a fraud on the defendant and that the amounts paid to the defendant were pursuant to letters of allotment for flats being constructed at Plot No.1-1/7, Hauz Khas, New Delhi by the defendant in collaboration with three companies who were the owners of the said plot. It was also stated on behalf of the defendant that although there was an allegation of advancement of loan to the tune of Rs.1,69,95,000/-, there is not a single document filed on record in support of such allegation either in the form of an agreement or confirming any such loan arrangement or confirming any interest amount being payable or confirming handing over of title documents as security or confirming handing over possession as Licensee or otherwise. There are several other defenses taken in the written statement, besides, the aforesaid defenses.

3. During the pendency of the aforesaid suit in this Court, an application is filed by the defendant praying for an order for release of the title documents deposited in this Court and also for handing over possession of the suit property to the defendant against deposit of Rs.1,69,95,000/- in this Court. This application has been filed by the defendant praying for an order and permission to the defendant to deposit the entire principal amount claimed in the suit in this Court and for return of the original title documents to the defendant which are being misused by Shri S.D. Sharma and for delivery of possession of the suit property to the defendant. In the said application it is contended by the defendant that since the suit was one for recovery of the alleged amount of loan and interest and since there is absolutely no document to show that the interest was payable, deposit of the principal amount in Court would fully secure the plaintiffs' interest so that even if the plaintiffs succeed in the suit finally, the money would be available to the plaintiffs thereafter. The aforesaid application was listed for arguments but the same could not be disposed of immediately. It is also clear from the records that after arguments were concluded in the aforesaid application, the plaintiffs filed an application in this Court praying for amendment of the plaint, which is registered as IA No.6930/2002. The plaintiffs by filing the said application seek to take up a plea in the plaint that the said suit property of which allegedly the defendant has put the plaintiffs into possession to secure payment of the money advanced by the plaintiffs to the defendant is governed by the provisions of the Delhi Land Reforms Act. It is submitted that by virtue of the provisions of the said Act, upon the defendant so putting the plaintiff into possession of the property, the plaintiffs have become the deemed owner of the property. It is contended by the plaintiff that the aforesaid amendment which is sought for is in alternative to the relief already claimed in the plaint in order to enable the plaintiff also to pray for a declaration that the plaintiffs have become the owners of the suit property. The said application filed by the plaintiff is opposed by the defendant contending, inter alia, that the amendment as sought for seeks to completely change the nature and character of the suit, that the amendment is based on void transaction and hence not permissible, that the said amendment is also barred under the provisions of Order II Rule 2 CPC and that the pleas sought to be taken now are mutually destructive to the earlier pleas.

4. In the context of the aforesaid pleadings of the counsel appearing for the parties in respect of the suit and also in respect of the applications, I have heard the counsel appearing for the parties and also perused the relevant documents to which my specific attention was drawn by the said counsel during the course of their submissions.

5. So far the application registered as IA No.1641/2002 is concerned, during the course of arguments, counsel appearing for the defendant specifically referred to the pleadings of the parties in the suit with specific reference to the reliefs that are sought for in the plaint. The suit as it stands today is a suit filed for recovery of the alleged amount of loan and interest and in the alternative for foreclosure of the mortgage or sale. The plaintiffs have pleaded in the plaint that on various dates between 5.7.1999 and 19.11.1999, a total amount of Rs.1,69,95,000/- was advanced as loan to the defendant out of which, according to the plaintiff, only an amount of Rs.25,000/- was only repaid on 25.10.1999.

6. The documents, which are filed by the plaintiffs have been perused by me. None of the aforesaid documents could be said to be documents indicating any agreement for confirming any such loan agreement. The aforesaid documents also do not confirm handing over of title documents as security or confirming handing over possession as Licensee or otherwise. However, the pleas and contentions raised in the plaint will have to be considered indepth during the course of the trial. Such pleas taken could be effectively considered and decided after the evidence is recorded in the suit. Whatever opinion that could be or is expressed at this stage is only a prima facie opinion.

7. Indeed the present suit is a suit for recovery of the amount of Rs.1,69,95,000/- along with the claim of payment of interest @ 24% per annum. Total claim that is made in the suit is for recovery of an amount of Rs. 2,04,76,219/-. The defendant has filed this application praying for allowing it to deposit the amount of Rs.1,69,95,000/-, which, according the the defendant, should be kept in the Court till the suit is finally decided and the claim of the plaintiff is finally adjudicated upon and decided by this Court. Counsel for the plaintiffs, however, stated that an amendment application is also pending for consideration wherein the plaintiffs have sought for amendment of the plaint by incorporating a prayer for passing a decree declaring the plaintiffs as the owners of the suit property in terms of the provisions of the Delhi Land Reforms Act and, therefore, it was submitted that the prayer in this application should be rejected. It was also submitted that in the event the said application is allowed and the defendant is directed to deposit the amount in that event the plaintiffs should be allowed to withdraw the said amount deposited by the defendant with or without furnishing security so that the plaintiffs are also not deprived of the benefit of amount. According to the plaintiffs, the expression 'mortgage money' would include not only the principal amount but also the interest payable thereon.

8. The aforesaid application was filed by the defendant in this Court on 14.2.2002. The order sheet maintained by this Court also indicates that arguments on the said application were also initially heard by my predecessor. However, before any order could be passed by the Court, the plaintiffs came up with the application (IA No.6930/2002) under Order VI Rule 17 CPC praying for amendment in the plaint. Therefore, the matter was released and I have heard the counsel for the parties on both the applications. The suit is filed by the plaintiffs with the allegation that mortgage was created in respect of the suit property to secure repayment of the alleged balance amount of loan of Rs.1,69,95,000/-. Although the defendant disputes the aforesaid allegations but it contends in the application that the defendant is ready and willing to secure the alleged claim by way of making a deposit in this Court of the amount of Rs.1,69,95,000/- subject to return of the title documents and possession of the land being handed over immediately and further subject to the condition that the said amount would not be withdrawn by any one or more of the plaintiffs till the final determination of the suit. Since the suit is a recovery suit praying for a decree for recovery of the amount of Rs.1,69,95,000/- together with interest at the rate of 24% per annum and since the defendant is ready and willing to deposit at least the principal amount in this Court to secure the interest of the plaintiffs in the suit, there is no reason why the defendant should not be allowed to deposit the said amount in this Court for recovery of which this suit is filed. Even if such an order is passed, the same would also fully secure and protect the claim of the plaintiff as raised in the suit. In that event also no prejudice would also be caused to any of the parties in the suit. In my considered opinion the defendant should also be allowed to enjoy the fruits of the property which, even according to the plaintiffs, was purchased by the defendant but possession of which was handed over to the plaintiffs as Licensee. It is again and again asserted in the plaint by the plaintiffs, namely, in paragraphs No.5,11,13 and 15 that the plaintiffs are the Licensee under the defendant. In paragraph 5 of the plaint, it is alleged that the defendant also on the insistence of Shri Shridev Sharma agreed that the vacant physical possession of the land shall also remain with Mr.Shridev Sharma on behalf of the plaintiffs till the repayment of the entire amount advanced, as a Licensee of the defendant in whose name the property shall be acquired. An alleged agreement between the parties is also referred to in the said paragraph to the effect that the title deeds of the land acquired by the defendant would remain deposited with the plaintiff and the same shall be handed over to the defendant upon repayment of the entire amount advanced together with interest. It is also alleged in paragraph 15 that the plaintiffs had mere rights as the Licensees in the form of possession of the aforesaid property till repayment of the dues. It is, therefore, repeatedly asserted by the plaintiffs in the aforesaid paragraphs that it is only a Licensee. The plaintiffs, however, filed an application seeking amendment to assert their right as owner of the suit property. But interestingly no amendment is sought for by the plaintiffs in the plaint with regard to the aforesaid status, which is claimed in the plaint as a Licensee. However, it is to be noted that the suit is filed by the plaintiffs for recovery of an amount of Rs.2,04,76,219/- along with interest @ 24% per annum towards pendente lite and future interest and cost of the suit.

9. In the facts and circumstances of the present case, I am, therefore,of the considered opinion that the defendant could be directed to deposit an amount of Rs.1,69,95,000/- by way of pay order / bank draft, which shall be deposited with the Registry of this Court within three weeks from today. For the balance amount of Rs.34,81,219/- for recovery of which also the present suit is filed, the defendants would give security in this Court in the form of a bank guarantee within three weeks, which shall be renewed from time to time till the disposal of the suit. As and when the amount of Rs.1,69,95,000/- along with the bank guarantee for the amount of Rs.34,81,219/- are deposited in this Court, the plaintiffs shall be entitled to withdraw the said amount on furnishing bank guarantee failing which the said amount shall be kept in a fixed deposit account after a period of three weeks from today to earn maximum interest, which shall also be renewed from time to time and till further orders of this Court. The bank guarantee, which is required to be furnished by the defendant and the plaintiff, if so furnished in terms of this order, would also be kept alive till the disposal of the suit. In case the defendant complies with the directions and observations made within a period of three weeks from today, the title deeds which are in the custody of this Court shall be handed over to the defendant. In that event the plaintiffs shall also hand over possession of the suit property to the defendant immediately.

10. In terms of the aforesaid order this application stands disposed of. I.A. No.6930/2002:

11. This application is filed by the plaintiffs praying for amendment of the plaint.

12. I have considered the submissions of the counsel appearing for the parties on the aforesaid application. The said application was filed seeking for amendment by way of additions of a relief in the nature of a declaration that the plaintiffs have become owners of land by virtue of deemed sale in terms of the alleged right conferred under Sections 34 and 43 of the Delhi Land Reforms Act. In order to appreciate the aforesaid contention, it is necessary to extract the aforesaid provisions, which read as under:

"34. Only simple mortgage of land by a Bhumidhar allowed. - No Bhumidhar shall have the right to mortgage any land belonging to him as such where possession of the mortgaged land is transferred or is agreed to be transferred in future to the mortgagee as security for the money advanced or to be advanced."

"43. Transfer with possession by a Bhumidhar to be deemed a sale. - Any transfer of any holding or part thereof made by a Bhumidhar by which possession is transferred to the transferee for the purpose of securing any payment of money advanced or to be advanced by way of loan, and existing or future debt or the performance of an engagement which may give rise to a pecuniary liability, shall, notwithstanding anything contained in the document of transfer or any law for the time being in force, be deemed at all times and for all purposes to be a sale to the transferee and to every such sale to the provisions of section 33 and 42 shall apply."

13. In my considered opinion along with the aforesaid provisions, the provisions of Section 45 of the Land Reforms Act is also material and relevant. The said Section is also extracted below:

"45. Transfer made in contravention of this Chapter to be void. - [(1)] Any transfer made by or on behalf of a Bhumidhar or Asami in contravention of the provision of this Chapter shall be void.

[(2)] Nothing in sub section (1) shall apply to any transfer which has been exempted by the Chief Commissioner [under the proviso to sub section (1) of section 33]."

14. A conjoint reading of the aforesaid sections would clearly indicate that any transfer of land made by a person who could be said to be a Bhumidhar in violation of Section 34 would be void. All the aforesaid provisions appear in the same Chapter, namely, Chapter III. According to the plaintiffs, the aforesaid transfer made by the defendant in favor of the plaintiffs mortgaging the aforesaid property along with transfer of possession of the property would be deemed to be a sale as provided under Section 43 of the Delhi Land Reforms Act. However, interestingly no foundation is laid either in the plaint or in the application filed seeking for amendment that the land in question which is the suit property is agricultural land, and the provisions of Delhi Land Reforms Act would be applicable only to such agricultural land. No foundation is laid by making any statement in the plaint or in this application that the defendant is a Bhumidhar. In absence of any foundation or pleadings of the parties that the suit property is agricultural land to which Delhi Land Reforms Act would be applicable and also without any specific statement that the defendant has acquired the right of the Bhumidhar, in my considered opinion, such amendment as sought for by the plaintiffs herein cannot be allowed. Besides, when the provisions of Sections 34, 43 and 45 are read together, it is crystal clear that the alleged transfer made by the defendant as a Bhumidhar in violation of Section 34 would be void as expressly declared by the Statute itself. If that be the position, in that event no suit to enforce a contract declared by the statute to be void can lie and no relief could be granted by the court on a void contract as by its very meaning such a contract is deemed not to exist. The Court would not and cannot come to the assistance of a party by giving relief to the said party for enforcement of the contract, which is ex facie void. In this regard reference may be made to the decision of the Supreme Court in Waman Shriniwas Kini vs. Ratilal Bhagwandas and Co., and Mannalal Khetan vs. Kedar Nath Khetan and others, wherein it was held that if the parties enter into a prohibited contact, such a contract is unenforceable. It was further held that it is well established that a contract which involves in its fulfilllment the doing of an act prohibited by statute is void and that where a contact, express or implied, is expressly or by implication forbidden by statute, no court can lend its assistance to give its effect. If the Court cannot grant the final relief, the question of allowing an amendment to include such a relief does not arise.

15.Another important aspect arising out of the issue also requires mention. The specific case of the plaintiff in the plaint is that the parties to the suit intended to create an equitable mortgage as stated in paragraph 5 of the plaint. It is averred therein that the parties agreed that the title deeds of the land acquired by defendant No.4 company would remain deposited with the nominees of Mr.Shridev Sharma, who would be advancing the money as security by way of equitable mortgage. However, Section 43 of the Delhi Land Reforms envisages a document of transfer which is possible in the case of an usufructuary mortgage where execution of a registered deed is compulsory. Therefore, some of the aforesaid provisions of the Act would apply to the present case where no registered document of transfer is either pleaded or placed on record. Even otherwise, the plaintiffs claim themselves to be Licensees in various paragraphs No.5,11,13 and 15 of the plaint. Now by filing this application, the plaintiffs are trying to acquire a status and position, which is diametrically opposed to the aforesaid status now claimed, namely, the status of a land owner and that also without claiming change in the status as a Licensee, which is claimed in the plaint. Therefore, the plaintiffs are trying to introduce entirely a new case than what is pleaded in the plaint. It is a settled law as is held by the Supreme Court in B.K. Narayana Pillai v. Parameswaran Pillai and another that inconsistent and contradictory allegations in negation to the admitted position of facts or mutually destructive allegations of facts should not be allowed to be incorporated by means of amendment to the pleadings. It is also a settled law that an amendment cannot be allowed to withdraw an admission and to take inconsistent pleas and to set up a totally new case which is held by this Court in Pushpa Guglani v. Modipon Ltd. reported in (1992) 1 RCR 337. The plaintiff also cannot be allowed to change its case completely and substitute with an entirely different and new case as the same would be in violation of the law laid down by the Supreme Court in Modi Spinning & Weaving Mills Co. Ltd. v. Ladha Ram & Co. reported in (1997) 1 SCR 728 and P.A. Ahammed Ibrahim v. Food Corporation of India .

16.In the light of the aforesaid discussion, I find no merit in this application. The application stands rejected.

17.In terms of this order both the applications stand disposed of.

C.S. (OS) No. 1077/2000:

Renotify the suit on 26.4.2004 for orders before the Joint Registrar.