Delhi High Court
Sunil Kapoor vs Himmat Singh & Ors on 22 September, 2008
Author: Hima Kohli
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ I.A.No.8235/2004 (u/O 7 R-11 of CPC) in CS(OS) 1018/2004
Date of decision : 22.9.2008
IN THE MATTER OF
SUNIL KAPOOR ..... Plaintiff
Through : Mr. Akshay Makhija, Adv.
versus
HIMMAT SINGH & ORS ..... Defendants
Through : Mr. Sanjiv Kakra, Adv.
CORAM
* HON'BLE MS.JUSTICE HIMA KOHLI
1. Whether Reporters of Local papers may be allowed to
see the Judgment? Yes
2. To be referred to the Reporter or not? Yes
3. Whether the judgment should be reported in the Digest?
Yes.
HIMA KOHLI, J. (O R A L)
1. The present application is filed by the defendants praying
inter alia for rejection of the plaint filed by the plaintiff on the ground
that the suit is without any cause of action and is liable to be rejected
CS(OS) No.1018 of 2004 Page 1 of 16
under Order 7 Rule 11 of the CPC.
2. Briefly stated, the facts of the case are that the plaintiff has
filed the present suit for specific performance of a verbal contract of
sale/ agreement to sell dated 23.2.2004, for sale of a portion of the
property bearing No.N-246, Greater Kailash Part-I, New Delhi-110 048,
for total sale consideration of Rs.80,00,000/-.
3. Counsel for the applicants/defendants states that the
present suit filed by the plaintiff is not maintainable as no cause of
action has arisen in favour of the plaintiff and against the defendants
for warranting the filing of the present suit. He submits that no
agreement to sell either oral or written has ever been entered into
between the parties. He further states that no concluded contract had
been agreed upon or entered into between the parties, capable of
being specifically enforced and no cause of action has arisen in favour
of the plaintiff and against the defendants for filing the present suit.
4. Counsel for the applicants/defendants submits that a
perusal of the token receipt dated 23.2.2004, on which the plaintiff
relies, reveals that it is a document executed by the defendant No.1
evidencing receipt of Rs.2,00,000/- and that as per the said receipt, it
was agreed that the agreement to sell shall be entered into within two
CS(OS) No.1018 of 2004 Page 2 of 16
months after discussing the details of the terms and conditions and the
price. He states that the detailed terms and conditions of the contract
were yet to be finalized and as such, no contract had concluded
between the parties. He further submits that the said receipt cannot
be construed as a valid enforceable document/agreement to sell or
contract of sale, for want of definite terms and conditions which are
necessary for construing an agreement to sell. He, therefore, states
that the present suit is hit by the provisions of Section 29 of the Indian
Contract Act, 1872, which stipulates that the agreement, meaning of
which is not certain or capable of being made certain, is void. In view
of the above, he submits that the present application is liable to be
allowed. In support of his contentions, he relies on the following
judgments :
1. Mayawanti vs. Kaushalya Devi, (1990) 3 SCC 1 ; and
2. High Way Farms vs. Chinta Ram & Ors., 2000
(56) DRJ (Suppl.) 201.
5. Per contra, counsel for the plaintiff disputes the aforesaid
position and emphasizes that the suit instituted by the plaintiff is
maintainable and the same is not hit by the provisions of Order 7 Rule
CS(OS) No.1018 of 2004 Page 3 of 16
11(a) of the CPC. He submits that a perusal of the plaint along with the
relevant documents filed on the record establish that a cause of action
has arisen in favour of the plaintiff and against the defendants. He
further reiterates that for the purposes of deciding the present
application, the Court is bound to examine only the pleadings on the
record and the documents in its support. In this regard, he draws the
attention of this Court to paras 1 & 2 of the plaint, wherein the plaintiff
has stated that he entered into an oral agreement to sell with the
defendant on 23.2.2004 for sale of a part of suit premises. The total
price of the suit premises has been stated to be of Rs.80,00,000/- and
advance payment of Rs.2,00,000/- paid by the plaintiff to defendant
No.1, is referred to in para 2 of the plaint. Execution of receipt by the
defendant No.1 is also referred to in para 2 of the application.
6. Counsel for the plaintiff states that in para 11 of the plaint,
he has referred to the fact that on 8.5.2004, the defendant No.2
admitted receipt of a total sum of Rs.8,00,000/- lacs from the plaintiff
out of which Rs.6,04,000/- was received in cash on the said date and
Rs.1,96,000/- was acknowledged as adjustment of the amount received
in excess of the rent payable by the plaintiff to the defendants. Thus,
it was stated that while including the sum of Rs.2,00,000/- received by
CS(OS) No.1018 of 2004 Page 4 of 16
the defendants on 23.2.2004, a total sum of Rs.10,00,000/- was
payable by the plaintiff to the defendants towards sale consideration,
thus, leaving a sum of Rs.70,00,000/- as payable against the total sale
consideration of Rs.80,00,000/-.
7. While referring to the receipts dated 23.2.2004, 8.5.2004
and 8.7.2004, counsel for the plaintiff submits that as the defendants
denied the document dated 8.5.2004, whereunder receipt of
Rs.8,00,000/- was mentioned against the signatures of the defendant
No.2 and the document dated 8.7.2004, stated to be executed by
defendant No.2, the said documents were directed to be sent to the
CFSL, which returned a report in favour of the plaintiff confirming that
the signatory of the said documents is defendant No.2 herself. He
further states that the defendant No.1 admits having signed the token
receipt dated 23.2.2004, for a sum of Rs.2,00,000/-. At this stage,
counsel for the defendants, while admitting having signed the token
receipt, states that his clients deny the date and the signatures of the
witness shown at serial No.2 thereon.
8. The object of the aforesaid provision is to keep out
irresponsible law suits. In a way, it is to be used as a handy tool by the
courts to segregate the grain from the chaff, on a purely prima facie
CS(OS) No.1018 of 2004 Page 5 of 16
examination of the statements made in the plaint. The purpose of the
said exercise is to ensure that a plaint which is on the face of it
vexatious and meritless and does not disclose a clear right to sue when
require to be thrown out at the threshold so that unnecessary
harassment and expense of the defendant is spared. In this regard
reference may be made to the case reported as Liverpool & London
S.P. & I. Association Ltd. vs. M.V. Sea Success I & Anr., (2004) 7 SCC
512, relevant extract of which is reproduced hereinbelow :
"Para 133: The idea underlying Order 7 Rule
11(a) is that when no cause of action is disclosed, the
courts will not unnecessarily protect the hearing of a
suit. Having regard to the changes in the legislative
policy as adumbrated by the amendments carried out
in the Code of Civil Procedure, the courts would
interpret the provisions in such a manner so as to save
expenses, achieve expedition and avoid the court's
resources being used up on cases which will serve no
useful purpose. A legislation which in the opinion of
the court is doomed to fail would not further be
allowed to be used as device to harass a litigant."
9. On the same lines, the observations made by the Supreme
Court in the case of Samar Singh vs. Kedar Nath, 1987 Supple. SCC
663 are as under :
"Para 4 : In substance, the argument is that
the court must proceed with the trial,
record of evidence, and only after the trial
CS(OS) No.1018 of 2004 Page 6 of 16
of the election petition is concluded that
the powers under the Code of Civil
Procedure for dealing appropriately with
the defective petition which does not
disclose cause of action should be
exercised. With respect to the learned
counsel, it is an argument which is difficult
to comprehend. The whole purpose of
conferment of such powers is to ensure
that a litigation which is meaningless and
bound to prove abortive should not be
permitted to occupy the time of the court
and exercise the mind of the respondent."
10. In the present case, the defendant has invoked the
provisions of Order 7 Rule 11(a) of the CPC to state that the plaint is
liable to be rejected as it does not disclose a cause of action. While
determining, as to what would constitute cause of action, the Supreme
Court in the case of Om Prakash Srivastava vs. Union of India reported
as (2006) 6 SCC 207 observed as below:
Para 12. The expression "cause of action" has
acquired a judicially settled meaning. In the
restricted sense "cause of action" means the
circumstances forming the infraction of the
right or the immediate occasion for the
reaction. In the wider sense, it means the
necessary conditions for the maintenance of
the suit, including not only the infraction of
the right, but also the infraction coupled with
the right itself. Compendiously, as noted above,
the expression means every fact, which it would be
necessary for the plaintiff to prove, if traversed, in
order to support his right to the judgment of the
court. Every fact, which is necessary to be proved,
CS(OS) No.1018 of 2004 Page 7 of 16
as distinguished from every piece of evidence,
which is necessary to prove each fact, comprises in
"cause of action". (See Rajasthan High Court
Advocates' Assn. v. Union of India (2001) 2 SCC
294)
Para 13. The expression "cause of action" has
sometimes been employed to convey the restricted
idea of facts or circumstances which constitute
either the infringement or the basis of a right and
no more. In a wider and more comprehensive sense,
it has been used to denote the whole bundle of
material facts, which a plaintiff must prove in order
to succeed. These are all those essential facts
without the proof of which the plaintiff must fail in
his suit ( See Gurdit Singh v. Munsha Singh , (1977)
1 SCC 791.
Para 14. The expression "cause of action" is
generally understood to mean a situation or
state of facts that entitles a party to maintain
an action in a court or a tribunal; a group of
operative facts giving rise to one or more
bases of suing; a factual situation that
entitles one person to obtain a remedy in
court from another person (see Black's Law
Dictionary). In Stroud's Judicial Dictionary a "cause
of action" is stated to be the entire set of facts that
gives rise to an enforceable claim; the phrase
comprises every fact, which if traversed, the
plaintiff must prove in order to obtain judgment. In
Words and Phrases (4th Edn.) the meaning
attributed to the phrase "cause of action" in
common legal parlance is existence of those facts,
which give a party a right to judicial interference on
his behalf. (See Navinchandra N. Majithia v. State of
Maharashtra,(2000) 7 SCC 640 )" (emphasis
added)
CS(OS) No.1018 of 2004 Page 8 of 16
11. In the case of Union of India vs. Adani Exports Ltd. reported
as AIR 2002 SC 126, the Supreme Court observed as under:
"10. ...Cause of action as understood in civil
proceedings means every fact which, if
traversed, would be necessary for the
plaintiff to prove in order to support his right
to a judgment of the Court. It is the bundle of
facts which taken with the law applicable to
them, gives the plaintiff a right to relief
against the defendant. Each and every fact
pleaded in the writ petition does not ipso facto lead
to the conclusion that those facts give rise to a
cause of action within the court's territorial
jurisdiction unless those facts pleaded are such
which have a nexus or relevance with the lis that is
involved in the case. Facts
which have no bearing
with the lis or dispute involved in the case, do not
give rise to a cause of action so as to confer
territorial jurisdiction on the court concerned."
(emphasis added)
12. Thus, it is apparent from the aforesaid judicial
pronouncements that while examining the expressing cause of action,
the court ought to look at the factual situation that gives rise to an
enforceable claim. For the said purpose, the material facts are
required to be stated. As observed by the Supreme Court in the case
of Liverpool & London S.P. & I Assn. Ltd. (supra) whether a plaint
discloses a cause of action or not is essentially a question of fact. But
whether it does or does not, must be found out from reading the plaint
itself. For the said purpose, the averments made in the plaint in their
entirety must be held to be correct. Although the Order 7 Rule 11(a)
of the CPC authorizes the court to reject a plaint on failure on part of
the plaintiff to disclose a cause of action but the same would not mean
that the averments made therein or document upon which reliance has
been placed although discloses a cause of action, the plaint would be
rejected on the ground that such averments which are not sufficient to
prove the facts stated therein for the purpose of obtaining the reliefs
claimed in the suit. The court must assume that the submissions in
the plaint are true and has to find out if they disclose a cause of action
or a triable issue. For the said purpose, the defence taken by the
defendant in its written statement cannot be probed. Nor can the
court dissect the pleading into several parts and consider whether
each of them disclose a cause of action (Refer : D. Ramachandran vs.
R.V. Janakiraman, (1999) 3 SCC 267.
13. So long as the plaint discloses some cause of action or raise
some question fit to be decided merely the case is weak or not likely to
succeed ultimately cannot be a ground for rejecting it. The court must
satisfy itself during the course of a preliminary examination of the
plaint that the averments made in the plaint if accepted as true would
entitle the plaintiff to the relief as he claims and no elaborate enquiry
into doubtful or complicated questions of law or fact is required for the
said purpose, and nor can the court embark upon such an enquiry to
establish whether the plaintiff would ultimately succeed in being
granted relief prayed for (Refer : Vijai Pratap Singh vs. Dukh Haran
Nath Singh, AIR 1962 SC 941).
14. Examining the plaint in the present case in the light of the
aforesaid guidance, one finds that the plaintiff has based its case on an
oral agreement to sell dated 23.2.2004. He refers to the token
received of the same date issued by the defendant No.1 for a sum of
Rs.2,00,000/-. Averments are made in the plaint with regard to the
details of the property stated to have been agreed to be sold by the
defendants to the plaintiff along with the total sale consideration. It is
the case of the plaintiff that it was already in occupation of the portion
of the property agreed to be purchased from the defendants as a tenet
therein and a fresh lease deed was executed between the parties for
the period 1.11.2002 to 31.10.2005 @ Rs.4,000/- per month. It is
further stated that the defendants were receiving additional amounts
from the plaintiff from time to time with the understanding that the
excess amounts will be adjusted towards the sale consideration after
adjusting the rental payable. It is stated by the plaintiff that as the
defendant was in financial difficulties, they decided to sell the portion
of the suit premises under the occupation of plaintiff which resulted in
the oral agreement to sell followed by the receipt dated 23.2.2004
documents dated 8.5.2004 and 8.7.2004.
15. In para 13 of the plaint, it is stated that the two cheques for
a sum of Rs.32,000/- were received in the manner as received earlier
with the promise that they would be adjusted towards the sale
consideration of the property after adjusting the rental payable by the
plaintiff to the defendants. It is further narrated in the plaint that only
after receipt of notices dated 22.7.2004 and 24.8.2004 did the plaintiff
realize that the defendant was trying to avoid his obligations under the
agreement to sell by receiving the balance sale consideration of
Rs.69,76,000/- from the plaintiff resulting in filing of the present suit.
16. In para 24 of the plaint, the plaintiff has dealt with the
cause of action for fling of the suit and stated that the same arose on
23.2.2004, the date when the verbal talks/negotiations for the sale of
the suit property took place and pursuant thereto, a sum of
Rs.2,00,000/- is stated to have been received by the defendants from
the plaintiff. It is further stated that the cause of action arose on
8.5.2004, when further a sum of Rs.8,00,000/- was received by the
defendants form the plaintiff against the receipt dated 8.5.2004
executed by the defendant No.2 and further on 8.7.2004, when the
defendants agreed that they will not charge the rental from the
plaintiff w.e.f. 1.8.2004. It is further stated that the cause of action
continue to accrue in favour of the plaintiff and against the defendants.
The cause of action constitute a bundle of facts that form the basis for
instituting the present suit. In each case, the peculiarity of the case
has to be construed for the examination as to whether the cause of
action has arisen in favour of a party instituting the suit or not.
17. In short, the allegations made in the plaint are that the
plaintiff had entered into a formal agreement to sell with the
defendants for sale of the part of the suit premises. The identity of the
premises and the total sale consideration find mention in the
documents in question. The emphasis laid by the counsel for the
defendants on the terminology used in the documents dated 23.2.2004
to the effect that the detailed terms and conditions and price shall be
discussed and agreement to sell shall be entered into within two
months, is not sufficient to throw out the plaint at this stage. The plea
of the counsel for the defendant is that the receipt dated 23.2.2004
cannot be construed as a valid enforceable document and reference to
Section 29 of the Indian Contract Act in this regard is not sufficient to
non-suit the plaintiff without a full rest trial. It is not a case where this
Court can conclude that the plaint is defected and does not disclose a
cause of action so as to throw the same out under the provisions of
Order VII Rule 11 of the CPC. It will be for the plaintiff to prove its
cause on the basis of evidence at the time when the case is taken to
trial. Such a question cannot be gone into at this stage.
18. Taking into consideration the averments made in the plaint
by the plaintiff and the documents placed on the record and
particularly, noting the fact that pursuant to the token receipt dated
23.2.2004, two other documents were executed on behalf of the
defendants for the same premises, dated 8.5.2004 and 8.7.2004, the
identity of the suit property is established, the price thereof is
established and even the agreed date for registering the sale deed is
indicated therein.
19. In these circumstances, it cannot be stated at this stage
that the suit is liable to be thrown out as invalid on the basis of vague
averments that no cause of action at all has arisen in favour of the
plaintiff and against the defendants. The plea raised on behalf of the
defendants can be considered after the issues are framed and the
parties are given an opportunity to lead evidence in respect of their
case.
20. In the aforesaid circumstances, the prayer made in the
present application is declined.
21. The application is disposed of.
22. It is however made clear that the observations made in the
present application are limited to the disposal of the present
application and the parties shall be at liberty to take all the pleas as
may be available to them in law, at the time of framing of issues in the
suit.
HIMA KOHLI,J
SEPTEMBER 22, 2008
sk/`ns'
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CS(OS) 1018/2004
SUNIL KAPOOR ..... Plaintiff
Through : Mr. Akshay Makhija, Adv.
versus
HIMMAT SINGH & ORS ..... Defendants
Through : Mr. Sanjiv Kakra, Adv.
CORAM:
HON'BLE MS. JUSTICE HIMA KOHLI
ORDER
% 22.09.2008
Counsels for the parties state that they have filed their original
documents. Accordingly, list this matter before the Joint Registrar for
admission/denial of documents on 14th January, 2009.
List before the Court on 17th February, 2009 for framing of issues.
HIMA KOHLI,J
SEPTEMBER 22, 2008
sk
