Delhi High Court
Subhash Sethi vs Shanti Lal Bhatia on 28 August, 2008
Author: S.Ravindra Bhat
6
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CS(OS) 572/2005
28.08.2008
SUBHASH SETHI ..... Plaintiff
Through Mr. Harish Malhotra, Sr. Advocate with
Mr. Vipul Gupta, Advocate
versus
SHANTI LAL BHATIA ..... Defendant
Through Mr. Anwar Hussain, Advocate for defendant
No.1.
%28.08.2008
CORAM:
Mr. Justice S. Ravindra Bhat
1.
Whether reporters of local papers may be
allowed to see the judgment?
2. To be referred to the Reporter or not?
3. Whether the judgment should be reported
in the Digest?
Mr. Justice S. Ravindra Bhat(OPEN COURT)
I.A. 9442/2007 and 9443/2007
1. The applicant M/s. SLBS Ispat Udyog Pvt. Ltd. seeks impleadment by application
under Order 1 Rule 10 CPC (I.A. 9442/2007) in the above suit for specific performance,
filed against the first defendant. The other application I.A. 9443/2007 is for ad interim
injunction.
2. The brief facts necessary to decide these applications are that in the suit a decree
for specific performance in respect of property being 11/5, Shakti Nagar, Delhi
measuring 220 sq. yds. has been sought. The plaintiff relies upon an agreement to sell
CS(OS) 572/2005 Page 1
said to have been entered into on 08.09.2004. The suit averments are that the total
consideration agreed upon was Rs. 70,00,000/- of which the plaintiff avers to having paid
Rs. 15,00,000/- to the first defendant. The plaintiff further avers that the State Bank of
India which was originally impleaded as the second defendant was mortgagee in respect
of the suit property and the first defendant vendor was liable to it to the extent of Rs.
79,21,000/-.
3. The suit was contested by both defendants. During the pendency of proceedings,
the plaintiff entered into settlement with the second defendant. Accordingly, the second
defendant moved I.A. 1104/2006 which was considered and disposed off. The Court on
that date took on record the settlement, recording the compromise between the plaintiff
and the second defendant and proceeded to delete the later from the array of parties.
4. The first defendant (vendor in the suit for specific performance) carried the order
of this Court dated 24.8.2007 in appeal, i.e. FAO(OS) 409/2007. The appeal was
dismissed on 21.07.2008. The Division Bench upheld the learned single Judge's view
that the settlement between the plaintiff and the defendant No. 2 would not, in any
manner, affect the rights of the appellant i.e. first defendant.
5. The present applicant submits that the first defendant was a guarantor for the loan
which was ultimately settled and so recorded by the Court. It is submitted that the money
received by the State Bank of India would have to be appropriately accounted in other
proceedings pending before the Debt Recovery Tribunal and also to the Income Tax
Authorities. In the circumstances, the applicant submits that it is a necessary party and
should be impleaded in the proceedings. Learned counsel urges that besides, valuable
rights of the company would be affected if the suit is proceeded without impleading it as
CS(OS) 572/2005 Page 2
a necessary party.
6. Undeniably, the present action is in the context of a suit claiming decree of
specific performance. It has been repeatedly held that by several judgments of the
Supreme Court including Kasturi v. Iyyam Perumal, (2005) 6 SCC 733 that the vendor
and the vendee, are necessary parties in such proceedings. It has also been held that
normally the plaintiff being dominus litus is entitled to implead the parties who he deems
are necessary for the action. The Court held that impleading other parties who are
inessential who would introduce an element of controversy which is alien and irrelevant
to the dispute before the Court would alter its character. That logic applies with equal
force in this case. It is not the applicant's case that it was a party to the agreement, which
is the subject matter of the suit. It is also not its case that it owns the property. In the
circumstances, the events which occurred after the suit was instituted i.e. payment of
amount to the vendors/creditors and its appropriation, lawful or otherwise, cannot by any
stretch of imagination constitute facts and issues which would arise in this case and have
to be examined by the Court. Entertaining such application in fact would dilute the
proceedings. Further, the Court is of the opinion that the application, moved on behalf of
the son of the first defendant is a thinly disguised attempts to prolong the proceedings and
somehow postpone the trial in this case. Therefore, it is an abuse of a judicial process.
7. For the above reasons, the applications are not maintainable; they are accordingly
dismissed. In the circumstances of this case, the applicant shall bear the costs quantified
at Rs. 30,000/- to be paid to the plaintiff within two weeks. The applicant shall also file a
compliance affidavit within three weeks with regard to the payment of costs.
I.A. 3352/2005
CS(OS) 572/2005 Page 3
8. This is an application for ad interim injunction. This Court by order dated 29th
April, 2005 by an ad interim ex-parte order restrained the defendants from selling,
transferring or alienating the property. That order subsists and binds the parties till date.
9. During the interregnum, the order dated 24th August, 2007 would show that
defendant No.2 was paid certain amounts; as a consequence, it was deleted from the array
of the parties. That order was carried in appeal; the Division Bench rejected the same.
10. In view of the averments in the plaint and the application as well as the
subsequent proceedings, the Court is of the opinion that the order made on 29th April,
2005 should be confirmed. The parties shall bound by the same till disposal of the suit.
11. I.A. 3352/2005 is disposed of in the above terms.
I.A. 5324/2007
12. This application seeks an order that plaintiff should not dispose off the property.
Learned counsel for the plaintiff submits, upon instructions, that the status quo with
regard to the title would not be varied without leave of the Court.
13. The application is disposed off in terms of the statement. The plaintiff shall file
an undertaking to such effect within one week.
CS(OS) 572/2005
14. List before the Joint Registrar for recording evidence of the parties on 29 th
September, 2008.
15. List before the Court on 10th December, 2008.
S. RAVINDRA BHAT,J
AUGUST 28, 2008
dkg
CS(OS) 572/2005 Page 4
