Telangana High Court
Vattikonda Viswanadham vs Kondaparthi Srinivas Rao And 2 ... on 26 August, 2022
Bench: P Naveen Rao, Sambasivarao Naidu
HONOURABLE SRI JUSTICE P.NAVEEN RAO
&
HON'BLE SRI JUSTICE SAMBASIVARAO NAIDU
APPEAL SUIT NO.293 OF 2021
Date: 26.08.2022
Between:
Vattikonda Viswanadham, s/o. late Nagabushanam,
Aged 72 years, occu:Advocate-cum-Agriculture,
r/o.Allipuram Road, Khammam, Khammam District.
.....Appellant/respondent/
plaintiff
and
Kondaparthi Srinivas Rao, s/o. Ramaiah,
Aged 67 years, occu:Finance Business,
r/o.H.No.11-8-163/1, Lenin Nagar, Khammam,
Khammam district and two others.
.....Respondents/petitioners/
defendants
The Court made the following:
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2
HONOURABLE SRI JUSTICE P.NAVEEN RAO
&
HON'BLE SRI JUSTICE SAMBASIVARAO NAIDU
APPEAL SUIT NO.293 OF 2021
JUDGMENT: (per Hon'ble Sri Justice P.Naveen Rao)
Heard Sri Kowturu Pavan Kumar, learned counsel for
appellant and Sri. A.Srinivasa Rao, learned counsel for the
respondents.
2. Parties are referred to as arrayed in the suit. Facts
leading
to institution of this appeal are as under:
2.1. Plaintiff executed registered Agreement of Sale-cum-
General Power of Attorney (GPA) bearing document
No.1285/2001, dated 13.03.2001 in favour of defendant no.3 in
respect of the suit schedule property on receiving sale
consideration of 4,55,000/-. The GPA holder executed sale
deed of the same property in favour of the 2nd defendant.
2.2. The 2nd defendant filed O.S.No.222 of 2004 in the Court of
II Additional Junior Civil Judge, Khammam, praying to grant
decree of perpetual injunction against the plaintiff, which was
later transferred to the Court of Senior Civil Judge, Khammam,
and renumbered as O.S.No.259 of 2009. By judgment dated
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31.08.2016, the Senior Civil Judge dismissed the said suit.
Appeal Suit No.21 of 2007 on the file of Principal District Judge,
Khammam, preferred against judgment was allowed by
judgment dated 08.02.2019. The Second Appeal No.155 of
2019 on the file of this Court, preferred by the plaintiff against
judgment in A.S.No.21 of 2007, was dismissed. However, while
dismissing Second Appeal, liberty was granted to challenge the
documents i.e., the registered agreement of sale-cum-GPA
bearing document No.1285/2001, dated 13.03.2001 and
registered sale deed bearing No.3419/2001 dated 15.06.2001 as
per law.
2.3. Taking cue from the observation made by the Second
Appellate Court and alleging that Agreement of Sale cum-GPA
was secured from the plaintiff under duress and coercion, the
plaintiff instituted O.S.No.157 of 2019 in the Court of Special
Sessions Judge for Fast-Tracking the cases relating to Atrocities
against women-cum-VIII Additional District and Sessions Judge
at Khammam, to declare the agreement of sale-cum-GPA dated
13.03.2001 and sale deed dated 15.06.2001 as illegal and
consequently to grant perpetual injunction. On receipt of
summons from the Court, the defendants filed Written
Statements and also filed I.A.No.2 of 2021 under Order VII Rule
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11(d) of Code of Civil Procedure, 1908 (for short, 'CPC'), to reject
the plaint. The defendants asserted that the suit is barred by
limitation on the face of it and, therefore, it is not maintainable.
According to the defendants, the suit is instituted in the year
2019 challenging the registered agreement of sale-cum-GPA and
sale deed executed in the year 2001 and there is inordinate
delay and, therefore, on that ground alone the suit is liable to be
dismissed. Accepting the plea of the defendants, Court below
allowed I.A.No.2 of 2021 rejecting the plaint. Aggrieved thereby,
this Appeal is preferred.
3. Learned counsel for the plaintiff contends that the trial
Court grossly erred in allowing I.A.No.2 of 2021 rejecting the
plaint as barred by limitation. Question of limitation is mixed
question of law and fact and unless evidence is led, the Court
cannot come to the conclusion at the preliminary stage itself to
hold that the suit is barred by limitation. He further contends
that Section 14 of the Limitation Act, 1963 (Act, 1963)
prescribes exclusion of time of prosecuting the litigation
bona fidely in the Court and in the instant case also, plaintiff
was prosecuting the earlier round of litigation on the ground
that Agreement of Sale-cum-GPA was obtained under coercion
and duress, as he was under impression that there is a good
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ground for setting aside the agreement of sale-cum-GPA. Once
Agreement of Sale-cum-GPA is set aside, the subsequent sale
deed automatically gets nullified. Only after dismissal of Second
Appeal, plaintiff realized that he need to challenge the sale deed
executed by the GPA holder. Further, second appellate Court
granted liberty to challenge the documents and therefore the
entire period spent in prosecuting the earlier round of litigation
stands excluded and in that view of the matter, it cannot be said
that suit is barred by limitation. The trial Court failed to
appreciate this point. The scope of Section 14 of the Act, 1963
requires consideration during the course of trial and, therefore,
trial Court ought not to have rejected the plaint at the threshold
without leading evidence and without considering application of
Section 14 of the Act, 1963.
4. In support of his contention, learned counsel for plaintiff
relied upon the decision of the Hon'ble Supreme Court in
Salim D.Agboatwala and others vs. Shamalji Oddhavji Thakkar
and others .
5. Per contra, learned senior counsel Sri M.V.Suresh Kumar,
appearing for Sri A.Sreenivasa Rao, learned counsel for the
2021 SCC Online SC 735
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defendants submitted that at the time of executing registered
Agreement of Sale-cum-GPA, the entire sale consideration was
paid and, therefore, it is not a simple case of executing GPA, but
the Agreement of Sale-cum-GPA creating interest in the
3rd defendant. On executing Agreement of Sale-cum-GPA,
possession was also vested in the 3rd defendant. As he was
authorized as GPA holder, he executed sale deed in favour of 2nd
defendant. No exception can be taken to the said transaction by
third defendant as he was having a valid GPA and full sale
consideration was already paid to the suit schedule land. He
further submitted that plaintiff had the knowledge of sale
transaction entered into by the 3rd defendant in favour of 2nd
defendant, but he kept quiet.
6. He would contend that having regard to the prayer sought
by the plaintiff i.e., declaration, cancellation and rescission, as
prescribed in Articles 582 and 593 of the Schedule appended to
the Act, 1963, the period of limitation prescribed is only three
years. Thus, from the date of execution of sale deed, within
three years suit ought to be instituted, whereas the suit was
Article.58. To obtain any other declaration--Three years--When the right to sue first
accrues.
Article.59. To cancel or set aside an instrument or decree or for the rescission of a
contract--Three years--When the facts entitling the plaintiff to have the instrument or
decree cancelled or set aside or the contract rescinded first become known to him.
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instituted after about 15 years. On the face of it, delay is
starring at the plaintiff. No further adjudication is required;
no evidence is required to be taken out as the chronology of
events are not in dispute. As on the face of it, suit is barred by
limitation, the trial Court has rightly exercised its discretion
under Order VII Rule 11(d) of CPC in rejecting the plaint. He
would submit that Article 14 of the Act, 1963, has no
application.
7. Learned senior counsel has drawn the attention to the
relevant clauses in agreement of sale to point out that in-
unequivocal terms, the plaintiff acknowledged receipt of full sale
consideration, vested possession of the suit schedule property
and also clearly stated that the 3rd defendant is Agent
authorized to deal with the suit schedule land in any manner as
he thinks fit. It is also categorically asserted that GPA cannot be
cancelled. That being so, the sale deed executed by the 3rd
defendant in favour of 2nd defendant cannot be nullified in
collateral proceedings and once GPA is in force, and once 3rd
defendant is authorized to execute the sale deed on behalf of the
plaintiff, the sale transaction between the plaintiff through GPA
holder (3rd defendant) and 2nd defendant cannot be declared as
illegal.
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8. Learned senior counsel placed reliance on the decision of
the Hon'ble Supreme Court in Dahiben vs. Arvindbhai Kalyanji
Bhanusali (Gajra) dead through legal representatives and others .
9. In reply, learned counsel for the plaintiff states that what
is urged before the trial Court is triable issue and when it is a
triable issue, unless evidence is led and matter is considered,
the issue cannot be decided. Therefore, the trial Court grossly
erred in rejecting plaint at threshold.
10. The prayer sought in O.S.No.157 of 2019 on the file of the
Principal District Judge, Khammam, reads as under:
1) therefore the plaintiff prays the Hon'ble Court may kindly be
declare as absolute owner of suit property by treating the
alleged sale agreement cum GPA document No. 1285/2001
dated 13.3.2001 and another document sale deed in favour of
defendant no.2 dated 15.6.2001 is null and void.
2) The Hon'ble Court may kindly cancel the documents No.
1285/2001 dated 13.3.2001 and sale deed in favour of
Defendant No.2 dated 15.6.2001 which are voidable
documents.
3) and Kindly direct the defendants jointly and severally to put
the plaintiff in peaceful possession and enjoyment of suit land
by remaining all substances or improvements if made by them
and in case of their failure, to execute the decree through
process of Hon'ble Court.
b) to grant a consequential permanent injunction
restraining the defendants, their men, agents and
(2020) 7 SCC 366
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persons acting for on their behalf from interfering with
the peaceful possession and enjoyment of the plaintiff
over the suit property.
c) to award the costs of the suit and
d) to grant such other reliefs as the Hon'ble Court may
deemed fit just under circumstances of the case"
11. The undisputed facts are as under:
12. Plaintiff was owner of 1300 square yards out of Ac.1.32
guntas in Survey No.162 of Pakabanda area. Plaintiff executed
registered agreement of sale cum General Power of Attorney
dated 13.3.2001 bearing document no.1285 of 2001 on the part
extent of land in favour of defendant no.3. Defendant no.3 as
GPA Holder of Plaintiff in turn executed registered sale deed
dated 15.6.2001 in favour of defendant no.2. Defendant no.2
instituted O.S.No.224 of 2004 which was renumbered as
O.S.No.259 of 2009 in the Court of the Principal Junior civil
Judge, Khammam (later transferred to the Court of Senior Civil
Judge at Khammam) praying to grant decree of perpetual
injunction against this plaintiff. Defendant claimed that by
virtue of registered sale deed dated 15.6.2001 he became the
owner of the subject land and is in possession and enjoyment
whereas plaintiff was trying to interfere. The trial Court
dismissed the suit holding that this plaintiff was in possession.
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On appeal before the Court of Principal District Judge in
A.S.No.21 of 2017, the decision of the trial Court was reversed
and appeal was decreed in favour of defendant no.2 herein.
Aggrieved thereby, this plaintiff preferred S.A.No.155 of 2019
before this Court and this Court affirmed the decision of the
First Appellate Court holding that trial Court erred in holding
that plaintiff was in possession contrary to agreement of sale
cum GPA and sale deed marked as exhibits A2 and A3. This
Court also noticed that AGPA and sale deed were never
challenged.
13. Plaintiff now challenges the Agreement of Sale-cum-GPA
dated 13.3.2001 and sale deed dated 15.6.2001. He asserts
that he came to know of execution of sale deed only in the year
2009 when he received summons in O.S.No.259 of 2009 and
thereon he was contesting the claim of the defendant no.2 till
the Second Appeal was disposed of on 17.7.2019 and asserts
that entire period during which he was prosecuting the above
litigation should be excluded for computation of limitation,
therefore the suit is within the limitation period.
14. According to him, cause of action arose on 15.6.2001 and
from which date he has been fighting the litigation. He further
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asserts that cause of action is continuous and suit is filed
within the period of limitation. In other words, it is not the case
of plaintiff that only in 2009 he came to know of execution of
registration of sale deed by his GPA holder. In the plaint,
plaintiff challenges the agreement of sale cum GPA on the
ground that it was obtained by duress and coercion, therefore,
null and void. According to him, the attorney of the said
document is only a name lender and had no financial capacity;
no consideration was paid as mentioned in the document, the
said document was executed as security as the defendant no.3
lent money to the plaintiff with an understanding that it would
be discharged soon after due amount was paid and that he had
paid the entire amount due. It is further asserted that in the
presence of witnesses, defendant no.3 promised and undertook
to cancel the document in respect of suit property. Thus, it is
not the case of the plaintiff that he was not aware of the
execution of the Agreement of Sale or GPA, authorising GPA to
enter into sale deeds on his behalf, execution of the sale deeds
on 15.6.2001 and at any rate, on receiving summons in the year
2009.
15. It is appropriate to notice that the earlier suit instituted
by the defendant no.2 was to grant decree of injunction
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restraining this plaintiff from interfering in possession and
enjoyment on the ground that he has purchased the property by
paying valid sale consideration and has been in possession and
enjoyment of the property. This plaintiff contested the said suit
by claiming to be in possession though he executed GPA and
GPA in turn executed sale deed. The issue of ownership is
different from possession. A person can claim possession as a
lessee or even by encroaching into the land. Therefore,
possession is not the same as ownership whereas earlier round
of litigation was on the issue of possession. In the earlier round
of litigation, it was categorically found by the First Appellate
Court that possession vested in the defendant no.2 and granted
injunction which declaration was affirmed by this Court in the
Second Appeal. This Court held that there was sale transaction
on open land and that possession follows title and until and
unless the title is disputed and in the absence of any cogent
evidence to show possession, merely because the plaintiff was
original owner of the land, he could not claim to be in
possession.
16. In the above factual background, the issue for
consideration is whether the trial Court erred in allowing the
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application filed under Order VII Rule 11 (B) of CPC and
rejecting the plaint.
17. Two submissions urged before the trial Court were,
i) to exclude time consumed in contesting O.S.No.224 of 2004,
the First and Second Appeals thereon; and ii) to compute
period of limitation from the date of decision by this Court in
S.A.No.155 of 2019.
18. On due consideration of scheme of Section 14 of
Limitation Act, 1963 and law on the subject, the trial Court held
that Section 14 has no application to the case on hand. Earlier
suit was not instituted by him and his appeals were not
dismissed for want of jurisdiction but on merits. On the second
aspect, the Court below noticed that in the Second Appeal this
Court only made an observation that the plaintiff did not
contest the legality and validity of AGPA dated 13.3.2001 and
sale deed dated 15.6.2001, exhibits A2 and A3, in appropriate
proceedings and has not expressed opinion with reference to the
rights of this plaintiff to challenge in appropriate proceedings. It
is pertinent to notice that this Court held that right to challenge
the legality of AGPA and sale deed executed by AGPA is subject
to law, which means law of limitation. The Court did not give a
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blanket discretion to assail the validity of those two documents
by condoning the delay. Therefore, disposal of Second Appeal
does not give independent cause of action nor the observations
save limitation.
19. As per Article 59 of the Act, 1963, period of limitation to
institute suit to cancel or set aside an instrument or decree or
for the rescission of contract is three years when the facts
entitling the plaintiff to have the instrument or decree cancelled
or set aside or the contract rescinded first become known to
him. Section 145 of the Act, 1963 enlarges the period of
limitation. It excludes the time spent in prosecuting a litigation
bona fidely. However, the plaintiff has to satisfy the conditions
stipulated therein to avail the benefit. Plaintiff has to show that
he was prosecuting the litigation with due diligence another civil
proceeding against the defendant; the proceeding relates to the
S.14. Exclusion of time of proceeding bona fide in court without jurisdiction - (1) In computing the period of limitation
for any suit the time during which the plaintiff has been prosecuting with due diligence another civil proceeding, whether in a
court of first instance or of the appeal or revision, against the defendant shall be excluded, where the proceeding relates to the
same matter in issue and is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature,
is unable to entertain it. (2) In computing the period of limitation for any application, the time during which the applicant has
been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, against
the same party for the same relief shall be excluded, where such proceeding is prosecuted in good faith in a count of first
instance or of appeal or revision, against the same party for the same relief shall be excluded, where such proceeding is
prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it. (3)
Notwithstanding anything contained in rule 2 of Order XXIII of the Code of Civil Procedure, 1908 (5 of 1908), the provisions of
sub-section (1) shall apply in relation to a fresh suit instituted on permission granted by the court under rule of that Order,
where such permission is granted on the ground that the first suit must fail by reason of a defect in the jurisdiction of the court
of other cause of a like nature. Explanation - For the purpose of this section, - (a) in excluding the time during which a former
civil proceeding was pending, the day on which that proceeding was instituted and the day on which it ended shall both be
counted; (b) a plaintiff or an applicant resisting an appeal shall be deemed to be prosecuting a proceeding; (c( misjoinder of
parties or of causes of action shall be deemed to be a cause of a like nature with defect of jurisdiction.
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matter in issue; prosecuted in good faith in a Court which, from
defect of jurisdiction or other cause of a like nature was unable
to entertain it.
20. Sale deed dated 15.06.2001 is consequential to executing
AGPA on 13.03.2001. Plaintiff assails the AGPA dated
13.03.2001. The validity of AGPA is nothing to do with
execution of sale deed dated 15.06.2001. The grounds urged
against AGPA were available when it was executed. The cause of
action arose on 13.03.2001 and that is the date on which right
to sue accrued to the plaintiff. Therefore, three years period
lapsed by 13.03.2004, much prior to institution of earlier suit.
The time spent in prosecuting earlier litigation cannot be
excluded to test the legality of AGPA.
21. The recitals of Agreement of Sale-cum-GPA disclose that
full sale consideration i.e., 4,55,000/- was received by the
plaintiff and though he was intending to execute registered sale
deed, but for some unspecified reasons, he could not execute
registered sale deed and therefore he executed AGPA. He
unconditionally authorised the GPA holder to deal with the
property including alienation of the property to himself or to any
other person of his choice, to avoid litigation, if any, and to
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represent before the Registrar for Registration of sale deed. It
also talks about handing possession to the GPA holder.
Contrary to the recitals, he now takes the plea that he executed
the said document due to duress and coercion. In other words,
what is alleged now relate back to date on which the AGPA was
executed and there are no new grounds. Therefore, if what is
contended is true 13.03.2001 is the date on which cause of
action first arose.
22. Alternatively, cause of action may have arisen on
22.05.2001 when plaintiff claims to have repaid amount
borrowed with interest, but no steps were taken to cancel AGPA
within three years from 22.05.2001. As rightly held by the trial
Court, plaintiff ought to have filed suit within three years when
the right to sue first arose to him i.e., 13.03.2001 or from
22.05.2001.
23. Basically, registration of sale deed amounts to putting on
notice public at large on the change of ownership on an
immovable property. Therefore, per se, no person can plead
ignorance of the sale transaction. Looking from this angle,
cause of action first arose against sale deed on 15.06.2001
when it was executed and registered.
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24. Further, ignoring the date of execution of AGPA and
assuming that there was no information on registration of sale
deed earlier, admittedly the plaintiff had knowledge of execution
of sale deed dated 15.6.2001 at least when he received
summons in the year 2009. Even after excluding the earlier
period and computing three years from said date, period of
limitation to avail remedy also lapsed in the year 2012.
25. In the facts of this case, the conditions stipulated in
Section 14 of the Act, 1963 are not attracted. It cannot be said
that plaintiff was bona fidely prosecuting earlier round of
litigation. In the earlier round of litigation, he did set up claim
to possession based on his ownership claim to the subject land.
The issue of legality and validity of AGPA dated 13.03.2001 and
execution of consequential sale deed on 15.06.2001 were not
the subject of controversy. The plaintiff therein claimed to
protect possession by relying on sale deed dated 15.06.2001
executed in his favour. It was not a case of defect of jurisdiction
or other cause of like nature. The suit was decided on merits on
contest. Plaintiff was not prosecuting the earlier litigation in
good faith. The earlier suit does not relate to same matter in
issue as in this suit. The observations made in S.A.No.155 of
2019 on not challenging the AGPA and sale deed and granting
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liberty to avail appropriate remedy do not enable plaintiff to
seek application of Section 14 of the Act, 1963.
26. The decision in Salim (supra) is on different set of facts
and circumstances and said decision do not come to the aid of
plaintiff. The rejection of plaint was sought primarily on two
grounds, (i) the suit filed in the year 1987 challenging the action
of the competent authorities under Maharashtra Tenancy and
Agricultural Lands Act, 1948 carried out way back in 1963 and
1964 was hopelessly barred by limitation; and (ii) that in any
case Section 85 of the Act, 1948 bars the jurisdiction of Civil
Court. According to plaintiff therein only after making
inspection of the records in connection with the suit land
available in the office of defendant no.3 therein i.e., Court
Receiver that they came across the correspondence and
documents relating to the transactions and that the proceedings
before the Agricultural Lands Tribunal were collusive,
fraudulent and null and void and only after gaining the
knowledge plaintiff was entitled to approach the Court. In those
circumstances, the Hon'ble Supreme Court observed that
limitation cannot be put against such a party and question of
limitation is a mixed question of fact and law. Hon'ble Supreme
Court observed that the answer to the issue regarding limitation
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will depend upon the evidence with regard to the issuance and
service of notice and knowledge of the plaintiffs.
26.1. The Hon'ble Supreme Court observed that the conditions
precedent to the exercise of the power are stringent and it is
especially so when rejection of plaint is sought on the ground of
limitation. Hon'ble Supreme Court observed that when a
plaintiff claims that he gained knowledge of the essential facts
giving rise to the cause of action only at a particular point of
time, the same has to be accepted at the stage of considering
the application under Order VII Rule 11. Hon'ble Supreme
Court further observed that the plea regarding the date on
which the plaintiffs gained knowledge of the essential facts, is
crucial for deciding the question whether the suit is barred by
limitation or not. Such issue becomes a triable issue and hence
the suit cannot be thrown out at the threshold.
27. In Deena (dead) through LRS Vs. Bharat Singh (dead)
through LRS6, the plaintiff sought for exclusion of period
between 21-3-1980 to 15-2-1982 under Section 14 of the
Limitation Act for computation of the period of limitation for
filing the suit. Briefly noted, the facts are as under:
(2002) 6 SCC 336
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27.1. Appellant mortgaged his land measuring 9 bighas 18
biswas for Rs.2500/- with possession on 7-2-1947 with
Plaintiff no.2 and father of Plaintiffs 15 to 19 and Khubi Ram @
Khushi Ram who is the predecessor-in-interest of plaintiffs 2 to
14. He filed an application for redemption of the land before
the Collector, which request was accepted on 29-2-1980 and the
land was ordered to be redeemed on payment of the mortgage
money. Appellants filed suit seeking declaration that they had
become owners of the property and order of redemption granted
by the Collector was null and void. The suit was decreed by the
trial Court. At the appellant stage, plaintiffs withdrew the suit
with permission to file fresh suit and thereafter fresh suit was
instituted seeking declaration that plaintiffs were owners of the
suit property, the order passed by the Collector was void and
inoperative and did not affect their rights. One of the issues
framed by the trial Court was on limitation and question
considered was whether plaintiffs were entitled to seek
exclusion of the period from 21.3.1980 to 24.2.1982 during
which period they were prosecuting earlier round of litigation.
The trial Court held against the plaintiffs on the issue of
limitation holding that plaintiffs were not prosecuting the
proceedings in the earlier round of litigation with due diligence
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and good faith. First Appellate Court affirmed the decision
holding that Section 14 of the Limitation Act does not come to
the rescue of the plaintiffs. High Court reversed the decisions of
the Appellate Court and trial Court and decreed the suit filed by
the plaintiffs. On Order XXIII Rule 2 of CPC, Hon'ble Supreme
Court held as under:
"14. The main factor which would influence the court in
extending the benefit of Section 14 to a litigant is whether the
prior proceeding had been prosecuted with due diligence and
good faith. The party prosecuting the suit in good faith in the
court having no jurisdiction is entitled to exclusion of that period.
The expression "good faith" as used in Section 14 means
"exercise of due care and attention". In the context of Section 14
the expression "good faith" qualifies prosecuting the proceeding
in the court which ultimately is found to have no jurisdiction. The
finding as to good faith or the absence of it is a finding of fact.
This Court in the case of Vijay Kumar Rampal v. Diwan Devi [AIR
1985 SC 1669] observed : (AIR p. 1670, para 3)
"The expression good faith qualifies prosecuting
the proceeding in the court which ultimately is found
to have no jurisdiction. Failure to pay the requisite
court fee found deficient on a contention being raised
or the error of judgment in valuing a suit filed before
a court which was ultimately found to have no
jurisdiction has absolutely nothing to do with the
question of good faith in prosecuting the suit as
provided in Section 14 of the Limitation Act."
15. The other expressions relevant to be construed in this
regard are "defect of jurisdiction" and "or other cause of a like
nature". The expression "defect of jurisdiction" on a plain reading
means the court must lack jurisdiction to entertain the suit or
proceeding. The circumstances in which or the grounds on
which, lack of jurisdiction of the court may be found are not
enumerated in the section. It is to be kept in mind that there is a
distinction between granting permission to the plaintiff to
withdraw the suit with leave to file a fresh suit for the same relief
under Order 23 Rule 1 and exclusion of the period of pendency of
that suit for the purpose of computation of limitation in the
subsequent suit under Section 14 of the Limitation Act. The
words "or other cause of a like nature" are to be
construed ejusdem generis with the words "defect of jurisdiction",
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that is to say, the defect must be of such a character as to make
it impossible for the court to entertain the suit or application and
to decide it on merits. Obviously Section 14 will have no
application in a case where the suit is dismissed after
adjudication on its merits and not because the court was unable
to entertain it."
27.2. The Hon'ble Supreme Court further observed that from
the judgment under Appeal there was no finding in the previous
suit holding the suit to be not entertainable on any ground. The
ground on which withdrawal of the suit was sought was that
Smt Ghogri, one of the mortgagors, was not made party to the
suit. Hon'ble Supreme Court observed that it is not the case of
the plaintiffs that the court had found the suit to be not
maintainable on that ground. Non-impleadment of
Smt Ghogri, a necessary party, in the suit was a clear case of
laches on the part of the plaintiffs. In such circumstances it
could not be said that the plaintiffs were prosecuting the
previous suit in good faith.
28. In Dahiben Vs Arvindbhai Kalyanji Bhanusali (Gajra)7
scope of Order VII Rule 11 of CPC was considered extensively by
Hon'ble Supreme Court. After obtaining due permissions,
plaintiffs sold the property to first respondent on 2.7.2009. The
sale deed records receipt of full sale consideration. First
(2020) 7 SCC 366
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respondent in turn sold very same property to the second and
third respondents on 1.4.2013. On 15.12.2014 plaintiff
instituted the suit against original purchaser by impleading
subsequent purchasers praying that sale deed dated 2.7.2009
be cancelled and declare it as being illegal void, ineffective and
not binding on them on the ground that the sale consideration
fixed by the Collector was not paid in entirety by respondent
no.1. In other words, suit for cancellation of sale deed was filed
after five years of execution of sale deed by the vendee to the
third parties. Prior to institution of the suit, at no point of time,
plaintiffs raised any grievance of not receiving the full sale
consideration mentioned in the sale deeds and for the first time
such allegation was made after five years from the date of
execution of the sale deeds. The Hon'ble Supreme Court
observed that delay of 5 ½ years after latest cause of action
arose in 2009 shows that the suit is clearly barred by limitation
as per Section 15 of the Limitation Act. That the cause of
action arose when sale deed was executed on 2.7.2009; that the
plaintiffs failed to discharge the onus of proof that the suit was
filed within the period of limitation. The plaint is therefore,
liable to be rejected under Order 7 Rule 11(d) CPC.
PNR,J & SSRN,J
AS No.293 of 2021
28.1. The Hon'ble Supreme Court further observed that
remedy under Order 7 Rule 11 is an independent and special
remedy, wherein the court is empowered to summarily dismiss
a suit at the threshold, without proceeding to record evidence,
and conducting a trial, on the basis of the evidence adduced, if
it is satisfied that the action should be terminated on any of the
grounds contained in this provision. It emphasised that "the
underlying object of Order 7 Rule 11(a) is that if in a suit, no
cause of action is disclosed, or the suit is barred by limitation
under Rule 11(d), the court would not permit the plaintiff to
unnecessarily protract the proceedings in the suit. In such a
case, it would be necessary to put an end to the sham litigation,
so that further judicial time is not wasted." Further, the
Supreme Court administered word of caution by holding that
"the power conferred on the court to terminate a civil action is,
however, a drastic one, and the conditions enumerated in Order
7 Rule 11 are required to be strictly adhered to". The Hon'ble
Supreme Court held as under:
"23.4. In Azhar Hussain v. Rajiv Gandhi [Azhar Hussain v. Rajiv
Gandhi, 1986 Supp SCC 315. Followed in Manvendrasinhji
Ranjitsinhji Jadeja v. Vijaykunverba, 1998 SCC OnLine Guj 281 :
(1998) 2 GLH 823] this Court held that the whole purpose of
conferment of powers under this provision is to ensure that a
litigation which is meaningless, and bound to prove abortive,
should not be permitted to waste judicial time of the court, in the
following words : (SCC p. 324, para 12)
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AS No.293 of 2021
"12. ... The whole purpose of conferment of such
powers is to ensure that a litigation which is
meaningless, and bound to prove abortive should not
be permitted to occupy the time of the court, and
exercise the mind of the respondent. The sword of
Damocles need not be kept hanging over his head
unnecessarily without point or purpose. Even in an
ordinary civil litigation, the court readily exercises the
power to reject a plaint, if it does not disclose any
cause of action."
xxx
23.11. The test for exercising the power under Order 7 Rule 11 is
that if the averments made in the plaint are taken in entirety, in
conjunction with the documents relied upon, would the same
result in a decree being passed. This test was laid down
in Liverpool & London S.P. & I Assn. Ltd. v. M.V. Sea Success
I [Liverpool & London S.P. & I Assn. Ltd. v. M.V. Sea Success I,
(2004) 9 SCC 512] which reads as : (SCC p. 562, para 139)
"139. Whether a plaint discloses a cause of action
or not is essentially a question of fact. But whether it
does or does not must be found out from reading the
plaint itself. For the said purpose, the averments
made in the plaint in their entirety must be held to be
correct. The test is as to whether if the averments
made in the plaint are taken to be correct in their
entirety, a decree would be passed."
23.12. In Hardesh Ores (P) Ltd. v. Hede & Co. [Hardesh Ores (P)
Ltd. v. Hede & Co., (2007) 5 SCC 614] the Court further held that
it is not permissible to cull out a sentence or a passage, and to
read it in isolation. It is the substance, and not merely the form,
which has to be looked into. The plaint has to be construed as it
stands, without addition or subtraction of words. If the
allegations in the plaint prima facie show a cause of action, the
court cannot embark upon an enquiry whether the allegations
are true in fact. D. Ramachandran v. R.V. Janakiraman [D.
Ramachandran v. R.V. Janakiraman, (1999) 3 SCC 267; See
also Vijay Pratap Singh v. Dukh Haran Nath Singh, AIR 1962 SC
941] .
23.13. If on a meaningful reading of the plaint, it is found that
the suit is manifestly vexatious and without any merit, and does
not disclose a right to sue, the court would be justified in
exercising the power under Order 7 Rule 11 CPC.
PNR,J & SSRN,J
AS No.293 of 2021
23.15. The provision of Order 7 Rule 11 is mandatory in nature.
It states that the plaint "shall" be rejected if any of the grounds
specified in clauses (a) to (e) are made out. If the court finds that
the plaint does not disclose a cause of action, or that the suit is
barred by any law, the court has no option, but to reject the
plaint.
24. "Cause of action" means every fact which would be necessary
for the plaintiff to prove, if traversed, in order to support his right
to judgment. It consists of a bundle of material facts, which are
necessary for the plaintiff to prove in order to entitle him to the
reliefs claimed in the suit.
24.1. In Swamy Atmananda v. Sri Ramakrishna
Tapovanam [Swamy Atmananda v. Sri Ramakrishna Tapovanam,
(2005) 10 SCC 51] this Court held : (SCC p. 60, para 24)
"24. A cause of action, thus, means every fact,
which, if traversed, it would be necessary for the
plaintiff to prove in order to support his right to a
judgment of the court. In other words, it is a bundle of
facts, which taken with the law applicable to them
gives the plaintiff a right to relief against the
defendant. It must include some act done by the
defendant since in the absence of such an act, no
cause of action can possibly accrue. It is not limited to
the actual infringement of the right sued on but
includes all the material facts on which it is founded."
(emphasis supplied)
24.3. Subsequently, in ITC Ltd. v. Debts Recovery Appellate
Tribunal [ITC Ltd. v. Debts Recovery Appellate Tribunal, (1998) 2
SCC 70] this Court held that law cannot permit clever drafting
which creates illusions of a cause of action. What is required is
that a clear right must be made out in the plaint.
24.4. If, however, by clever drafting of the plaint, it has created
the illusion of a cause of action, this Court in Madanuri Sri Rama
Chandra Murthy v. Syed Jalal [Madanuri Sri Rama Chandra
Murthy v. Syed Jalal, (2017) 13 SCC 174 : (2017) 5 SCC (Civ)
602] held that it should be nipped in the bud, so that bogus
litigation will end at the earliest stage. The Court must be vigilant
against any camouflage or suppression, and determine whether
the litigation is utterly vexatious, and an abuse of the process of
the court.
xxx
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AS No.293 of 2021
28. A three-Judge Bench of this Court in State of
Punjab v. Gurdev Singh [State of Punjab v. Gurdev Singh, (1991) 4
SCC 1 : 1991 SCC (L&S) 1082] held that the Court must examine
the plaint and determine when the right to sue first accrued to
the plaintiff, and whether on the assumed facts, the plaint is
within time. The words "right to sue" mean the right to seek relief
by means of legal proceedings. The right to sue accrues only
when the cause of action arises. The suit must be instituted
when the right asserted in the suit is infringed, or when there is a
clear and unequivocal threat to infringe such right by the
defendant against whom the suit is instituted. Order 7 Rule 11(d)
provides that where a suit appears from the averments in the
plaint to be barred by any law, the plaint shall be rejected."
29. Having regard to scope of Section 14 of the Act, 1963 and
the law holding the field the plaintiff is not entitled to take
recourse to Section 14. The facts in issue as urged in the plaint
and prayer sought are clear and no ambiguity in assessing the
date of arising of cause of action. On a meaningful reading of
the plaint, it is apparent that this is a vexatious litigation and
needs to be nipped in the bud. We see no error in the decision
of trial Court allowing I.A.No.2 of 2021 and rejecting the plaint.
The Appeal fails. It is accordingly dismissed. Pending
miscellaneous petitions if any shall stand closed.
______________________________
P.NAVEEN RAO, J
______________________________
SAMBASIVA RAO NAIDU, J
Date: 26.08.2022
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PNR,J & SSRN,J
AS No.293 of 2021
HONOURABLE SRI JUSTICE P.NAVEEN RAO
&
HON'BLE SRI JUSTICE SAMBASIVARAO NAIDU
APPEAL SUIT NO.293 OF 2021
Date: 26.08.2022
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