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Issues: (i) Whether the plaint disclosed a cause of action or was liable to rejection for presenting only an illusory claim; (ii) Whether the suit was barred by limitation and therefore liable to rejection.
Issue (i): Whether the plaint disclosed a cause of action or was liable to rejection for presenting only an illusory claim.
Analysis: The plaint had to be read as a whole along with the documents filed with it. The registered sale deed executed by the plaintiffs recorded acknowledgment of receipt of the full sale consideration, and the plaintiffs' plea that most of the consideration was unpaid was inconsistent with the recitals. Even if the alleged non-payment were assumed, such non-payment would not by itself invalidate the completed sale or furnish a basis for cancellation of the registered deed. The pleadings were found to be the result of clever drafting and to create only an illusory cause of action.
Conclusion: The plaint did not disclose a sustainable right to sue and was liable to rejection under Order VII Rule 11(a) of the Code of Civil Procedure, 1908.
Issue (ii): Whether the suit was barred by limitation and therefore liable to rejection.
Analysis: For cancellation of a registered instrument and declaration of its invalidity, the limitation period under Articles 58 and 59 of the Limitation Act, 1963 is three years from the date when the right to sue first accrues. On the plaintiffs' own showing, the alleged grievance arose in 2009 when the sale deed was executed and consideration was said to be unpaid. The suit filed in December 2014 was therefore beyond time, and the later plea of discovery in 2014 was held incapable of postponing accrual of limitation.
Conclusion: The suit was barred by limitation and was liable to rejection under Order VII Rule 11(d) of the Code of Civil Procedure, 1908.
Final Conclusion: The rejection of the plaint was upheld, and the civil appeal failed because the suit was both meritless on the pleadings and time-barred.
Ratio Decidendi: In deciding an application under Order VII Rule 11, the court may look only at the plaint and the documents relied upon with it; if those materials show that the plaint is built on an illusory cause of action or that the suit is clearly barred by limitation, the plaint must be rejected at the threshold.