Telangana High Court
Kosanapu Sarojini Devi Rao vs Gorry Saroja on 14 August, 2024
Author: K. Lakshman
Bench: K. Lakshman
HON'BLE SRI JUSTICE K. LAKSHMAN
CIVIL REVISION PETITION No.1494 OF 2024
ORDER:
Heard Mr. Ravindra Babu, learned counsel for the petitioner.
Despite service of notices, there was no representation on behalf of the
respondents.
2. The petitioner herein is defendant No.1 and respondent No.2
herein is defendant No.2 while respondent No.1 is the plaintiff in O.S.
No.446 of 2021 pending on the file of learned Principal Junior Civil
Judge-cum-Judicial Magistrate of First Class at Huzurabad.
3. Respondent No.1 herein has filed the aforesaid suit O.S.
No.446 of 2021 for specific performance of agreement of sale dated
10.04.1990 against the petitioner herein and respondent No.2 in
respect of property bearing house No.17-10 comprised of 1000 square
feet in an extent of 645.33 square yards, situated at Jammikunta Road,
Huzurabad Town, Karimnagar District.
4. While so, the petitioner herein - defendant No.1 filed an
Interlocutory Application vide I.A. No.931 of 2023 in O.S. No.446 of
2021 under Order - VII, Rule - 11 of CPC to reject the plaint on the
following grounds:
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i) Respondent No.1 alleges that the property sold to her by
the husband of the petitioner, the original owner under an
unregistered document which lacks legal validity;
ii) The period of limitation for filing the suit is three years.
The suit agreement of sale is dated 10.01.1990, whereas,
the suit is filed on 27.12.2021. Thus, the suit is
hopelessly barred by limitation;
iii) The petitioner filed a suit vide O.S. No.55 of 2022 in
respect of the very same property to grant perpetual
injunction and for declaration of title; and
iv) The alternative claim made in the suit pertains to the
refund of entire sale consideration of Rs.16.00 lakhs with
annual interest @ 24% compounded quarterly from
January, 1990 till December, 2021, which comes to
Rs.1,32,21,111/. The pecuniary jurisdiction of trial Court
i.e., Principal Junior Civil Judge, is limited to Rs.20.00
lakhs only. Therefore, the trial Court has no pecuniary
jurisdiction to try the suit;
5. Respondent No.1 filed counter opposing the said petition
contending that the suit is well within the limitation and Principal
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Junior Civil Judge has jurisdiction to try the suit. The grounds on
which defendant No.1 filed a petition under Order - VII, Rule - 11 of
CPC are triable issues.
6. The learned trial Court, vide order dated 19.12.2023
dismissed the said petition observing thus:
i. The executant of the agreement of sale is the resident United
States, and there is no time fixed for performance of contract;
ii. Contents of plaint would show that respondent No.1 made
repeated requests to the husband of the petitioner to execute
necessary sale document, but the petitioner prolonged the same.
There is no averment as to refusal of execution of sale deed in
the plaint. Further, the suit property was delivered to
respondent No.1 and she constructed a compound wall by
demolishing a dismantled house to the knowledge of the
petitioner. Since time is not the essence of contract and long
gap between the payments of part consideration does not
necessarily mean that there was breach of contract. In view of
the same, whether or not the suit is barred by limitation cannot
be decided in the present petition as it is a mixed question of
fact and law and requires a full-fledged trial.
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iii. As regards to pecuniary jurisdiction, as per agreement of sale,
there are no terms in respect of the refund of sale consideration
in case of breach of contract and interest payable in case of non-
performance of contract. Thus, the interest claimed @ 24% per
annum on Rs.16,00,000/- is not accrued interest as per the terms
of the contract. Therefore, it is for the trial Court to decide
about the amount of interest to be awarded if the prayer of
refund of amount paid is allowed and no court fee is said to be
payable on the interest sought at this stage. The trial Court is
well within its jurisdiction to order payment of deficit Court fee
at subsequent stage of the suit. According to the trial Court, the
court fee paid on the total sale consideration is sufficient.
7. Challenging the said order dated 19.12.2023 the petition filed
the present revision contending as follows:
i) The trial Court erred in arriving at a finding regarding
pecuniary jurisdiction as the claim exceeds the
jurisdiction of the Court, which is limited to Rs.20.00
lakhs, making the plaint liable for rejection;
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ii) There is no cause of action to file the suit and the same
was not considered by the trial Court;
iii) The trial Court erred in misinterpreting the principle laid
down by the Hon'ble Supreme Court in T.
Arivandandam v. T.V. Satyapal; and
iv) The agreement of sale in question is an unregistered one
and it violates public policy. As per Section - 23 of the
Indian Contract Act, 1872, such an agreement renders
unenforceable.
8. In view of the aforesaid rival contentions, it is apposite to
refer to the purport of Order - VII, Rule - 11 of CPC. It deals with
'rejection of plaint' and the same is extracted as under:
"11. Rejection of plaint.-- The plaint shall be
rejected in the following cases:--
(a) where it does not disclose a cause of action;
(b) where the relief claimed is undervalued, and
the plaintiff, on being required by the Court to
correct the valuation within a time to be fixed by
the Court, fails to do so;
(c) where the relief claimed is properly valued, but
the plaint is returned upon paper insufficiently
stamped, and the plaintiff, on being required by the
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Court to supply the requisite stamp-paper within a
time to be fixed by the Court, fails to do so;
(d) where the suit appears from the statement in
the plaint to be barred by any law;
(e) where it is not filed in duplicate;
(f) where the plaintiff fails to comply with the
provisions of rule 9:
Provided that the time fixed by the Court for the
correction of the valuation or supplying of the
requisite stamp-paper shall not be extended unless
the Court, for reasons to be recorded, is satisfied
that the plaintiff was prevented by any cause of an
exceptional nature from correcting the valuation or
supplying the requisite stamp-paper, as the case
may be, within the time fixed by the Court and that
refusal to extend such time would cause grave
injustice to the plaintiff."
9. The Hon'ble Supreme Court in Dahiben v. Arvindbhai
Kalyanji Bhanusali (GAJRA) 1 had on occasion to deal with the
object of Order - VII, Rule - 11 (a) and (d) of CPC and rejection of
plaint and also nature of enquiry to be made by the Court while
deciding an application filed under Order - VII, Rule - 11 (a) of CPC.
In the said case, the defendant filed an application under Order - VII,
Rule - 11 (a) and (d) to reject the plaint on the ground that the suit was
. (2020) 7 SCC 366
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barred by limitation and no cause of action has been disclosed in the
plaint. In the said case, sale deed was executed on 02.07.2009 and the
suit was filed on 15.12.2014. The cause of action as per the averments
of the plaint therein had arisen when defendant No.1 therein had
issued 'false' or 'bogus' cheques to the plaintiffs in 2009. The suit for
cancellation of the sale deed dated 02.07.2009 could have been filed
by 2012 as per Articles - 58 and 59 of the Limitation Act, 1963. The
suit was filed on 15.12.2014, which was barred by limitation.
Considering the said facts, the trial Court rejected the plaint filed by
the plaintiff by allowing the application filed under Order - VII, Rule -
11 (d). The High Court confirmed the said order passed by the trial
Court. On consideration of the said facts and also purport of Order -
VII, Rule - 11 of CPC, the Apex court held that in view of Order -
VII, Rule - 11 of CPC, documents filed along with plaint are to be
taken into consideration for deciding the application under Order -
VII, Rule - 11 (a) of CPC. When a document referred to in the plaint,
forms the basis of the plaint, it should be treated as a part of the plaint.
In exercise of power under Order - VII, Rule - 11 of CPC, Court
would determine if the assertions made in the plaint are contrary to
statutory law, or judicial dicta, for deciding whether a case for
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rejecting the plaint at the threshold is made out. At this stage, the
pleas taken by the defendant in the written statement and application
for rejection of the plaint on the merits, would be irrelevant, and
cannot be adverted to, or taken into consideration.
i) The Apex Court further held that the test for exercising the
power under Order - 7 Rule - 11 of CPC 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.
ii) The Apex Court also relied on the principle laid down by it
in decision in Liverpool & London S.P. & I Asson. Ltd. v. M.V.
Sea Success I 2, wherein it was held that 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.
iii) The Apex Court considered the principle laid down by it in
. (2004) 9 SCC 512
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Hardesh Ores (P) Ltd. v. Hede & Co. 3, to the effect 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. The said principle was also
reiterated in D. Ramachandran v. R.V. Janakiraman 4.
iv) The Apex Court also held that 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. The
power under Order - 7 Rule - 11 CPC may be exercised by the Court
at any stage of the suit, either before registering the plaint, or after
issuing summons to the defendant, or before conclusion of the trial.
The said principle was also laid down by the Apex Court in Saleem
Bhai v. State of Maharashtra5.
. (2007) 5 SCC 614
. (1999) 3 SCC 267
. (2003) 1 SCC 557
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v) In Azhar Hussain v. Rajiv Gandhi 6, the Apex Court
further held that the plea that once issues are framed, the matter must
necessarily go to trial.
vi) The provision of Order - 7 Rule - 11 of CPC 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.
"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.
vii) In ITC Ltd. v. Debts Recovery Appellate Tribunal7, the
Apex 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.
. 1986 Supp. SCC 315
. (1998) 2 SCC 70
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viii) The Apex Court further held that if, however, by clever
drafting of the plaint, it has created the illusion of a cause of action, 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 Court as held by the Apex Court in
Madanuri Sri Rama Chandra Murthy v. Syed Jalal8.
ix) The Limitation Act, 1963, prescribes a time-limit for the
institution of all suits, appeals, and applications. Section 2(j) defines
the expression "period of limitation" to mean the period of limitation
prescribed in the Schedule for suits, appeals or applications. Section -
3 lays down that every suit instituted after the prescribed period, shall
be dismissed even though limitation may not have been set up as a
defence. If a suit is not covered by any specific article, then it would
fall within the residuary article.
x) As per Article - 58 of the Limitation Act, suit for declaration
has to be filed within three (03) years when the right to sue first
accrues. Article - 59 says suit to cancel or set aside an instrument or
decree or for the rescission of a contract shall be filed within three
. (2017) 13 SCC 174
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(03) 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. Therefore, the present suit for partition and to declare
the sale deed bearing document No.9058 of 2006, dated 26.06.2006 as
null and void has to be filed within three (03) years when the facts
entitling the plaintiff to have instrument has become known to her.
xi) In Khatri Hotels (P) Ltd. v. Union of India 9, the Apex
Court held that the use of the word "first" between the words "sue"
and "accrued", would mean that if a suit is based on multiple causes of
action, the period of limitation will begin to run from the date when
the right to sue first accrues. That is, if there are successive violations
of the right, it would not give rise to a fresh cause of action, and the
suit will be liable to be dismissed, if it is beyond the period of
limitation counted from the date when the right to sue first accrues.
xii) In State of Punjab v. Gurdev Singh10, a three-Judge
Bench of the Apex Court 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
. (2011) 9 SCC 126
. (1991) 4 SCC 1
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"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
- VII 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.
xiii) In Rajendra Bajoria v. Hemant Kumar Jalan11, the
Apex Court relying on the principle laid down by it in Dahiben1 held
that when the Court is of the view just by reading the plaint alone and
assuming the averments made in the plaint to be correct that none of
the reliefs claimed can be granted in law since the plaintiffs are not
entitled to claim such reliefs, the Court should reject the plaint as
disclosing no cause of action. The reliefs claimed in a plaint flow from
and are the culmination of the cause of action pleaded in the plaint.
The cause of action pleaded and the prayers made in a plaint are
inextricably intertwined.
. (2022) 12 SCC 641
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10. In the light of the above and the principle laid down in the
aforesaid decisions, coming to the case on hand, respondent No.1
herein has filed a suit, vide O.S. No.446 of 2021 against the petitioner
and respondent No.2 herein seeking specific performance basing on
the agreement of sale dated 10.04.1990 executed by the husband of
the petitioner herein. In the said agreement of sale dated 10.04.1990,
the total sale consideration agreed is Rs.16,80,000/-. Respondent
No.1 herein being the Vendee, having agreed the said sale
consideration, paid an amount of Rs.2,50,000/- on 18.01.1989;
Rs.3,50,000/- on 10.05.1989 and Rs.4,00,000/- on 10.04.1990. Thus,
in all, respondent No.1 - plaintiff had paid an amount of
Rs.10,00,000/- leaving balance sale consideration of Rs.6,80,000/-.
11. They have further agreed that respondent No.1 shall pay
balance sale consideration at the time of registration. The husband of
the petitioner delivered vacant possession of the schedule property to
respondent No.1 herein on 10.04.1990 stating that she is at liberty to
enjoy the schedule property without any objection from anybody
including legal heirs, successors-in-interest, agents, representatives
and assignees and nominees of the Vendor i.e., husband of the
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petitioner herein. The husband of the petitioner and his legal heirs
undertook to execute and register sale deed in favour of respondent
No.1 herein as and when called upon by respondent No.1 herein. In
the said agreement of sale, it is further stated that "It was mutually
agreed between the parties that since Vendor is NRI the Vendee is at
liberty to arrange payment of balance consideration whenever the
Vendor visits India and keep some minimum balance for payment at
the time of registration." It is further agreed that "It is also hereby
clarified that time is not essence of the contract and Vendee can call
upon the Vendor or his legal heirs to execute and register sale deed
whenever she desires."
12. Thus, there is no time-line mentioned in the said agreement
for payment of balance sale consideration. It is not in dispute that the
husband of the petitioner was an NRI. It is also not in dispute that
there is time gap in making payments. An amount of Rs.2,50,000/-
was paid on 18.01.1989; Rs.3,50,000/- was paid on 10.05.1989 and
Rs.4,00,000/- was paid on 10.04.1990 and, thereafter, an amount of
Rs.6,00,000/- was paid on 07.03.2005. The balance sale consideration
is only Rs.80,000/-. The plaintiff has filed the said agreement of sale
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dated 10.04.1990, original cash receipts, dated 10.05.1989, 10.04.1990
and 07.03.2005.
13. In the plaint, it is further stated that respondent No.1 -
plaintiff demanded the husband of the petitioner many times to receive
balance sale consideration of Rs.80,000/- and execute and register sale
deed in her favour. The husband of the petitioner being an NRI
postponed the same on one pretext or other. He died. Thereafter,
respondent No.1 - plaintiff requested the petitioner being the sole legal
heir to receive balance sale consideration of Rs.80,000/- to execute
and register a sale deed in her favour in respect of the suit schedule
property. She has also postponed the same. Thus, there are specific
averments in the plaint. Accordingly, respondent No.1 sought the
relief of specific performance of the said agreement of sale, or in
alternative, direct the petitioner to refund the entire sale consideration
of Rs.16,00,000/- together with interest @ 24% per annum from
10.04.1990 till the date of payment. Interest is not the contractual
obligation. It is the discretion of the trial Court whether to grant or
not. Therefore, the contention of the petitioner - defendant No.1 that
the trial Court lacks pecuniary jurisdiction is unsustainable.
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14. As discussed above, there is no time specified to receive
balance sale consideration and execute and register a sale deed in
favour of respondent No.1 - plaintiff. On the other hand, in the
agreement of sale, dated 10.04.1990 itself, the husband of the
petitioner and respondent No.1 herein specifically agreed that time is
not the essence of contract.
15. The trial Court while dealing with an application under
Order - VII, Rule - 11 of CPC has to consider the pleadings of the
plaint and the documents filed along with the plaint. While deciding
an application under Order - VII, Rule - 11 of CPC, the pleas taken by
the defendant in written statement and application for rejection of
plaint on merits cannot be irrelevant and cannot be adverted or taken
into consideration.
16. In the light of the aforesaid principle, both the trial Court
and this Court has to consider the contents of the plaint and the
documents filed along with the plaint under Order - VII, Rule - 14 of
CPC. The contents of written statement and averments of the petition
filed by the defendant under Order - VII, Rule - 11 of CPC are
irrelevant to decide a petition under Order - VII, Rule - 11 of CPC.
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17. It is relevant to note that respondent No.2 - defendant No.2
is also claiming that he purchased the subject property from the
husband of the petitioner for a total sale consideration of Rs.5,00,000/-
and after receiving the entire sale consideration executed an un-
registered sale deed dated 30.01.1993 on Rs.100/- non-judicial stamp
paper. The physical possession was also delivered. Thereafter, he has
constructed compound wall etc. Therefore, the contents of the written
statement and petition filed under Order - VII, Rule - 11 of CPC
cannot be considered while deciding the petition under Order - VII,
Rule - 11 of CPC. On consideration of the said aspects only, vide
impugned order dated 19.12.2023 in I.A. No.931 of 2023 in O.S.
No.446 of 2021, learned trial Court dismissed I.A. No.931 of 2023.
There is no error in it. It is a reasoned order and well-founded and it
does not deserve any interference by this Court in the present revision.
Thus, the revision fails and the same is liable to be dismissed.
18. The present Civil Revision Petition is accordingly
dismissed. In the circumstances of the case, there shall be no order as
to costs.
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As a sequel thereto, miscellaneous petitions, if any, pending in
this revision shall stand closed.
_________________
K. LAKSHMAN, J
14th August, 2024
Mgr
