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AI Drafter - (New and Powerful) ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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Issues: Whether a civil suit seeking cancellation of a registered sale deed is barred by Section 34 of the SARFAESI Act and liable to rejection under Order VII Rule 11 of the Code of Civil Procedure, 1908.
Analysis: The plaint had to be examined on its own averments and not on the defence version. The allegations of coercion, threats, misrepresentation and undue influence went to the question of free consent under the Indian Contract Act, 1872, and could not be rejected merely because no FIR or criminal complaint had been filed. The absence of elaborate fraud particulars, the controversy regarding the MoU, and the plea based on Sections 91 and 92 of the Indian Evidence Act, 1872 were matters for trial and did not justify rejection of the plaint at the threshold. The relief claimed was cancellation of a registered conveyance, and the Debt Recovery Tribunal had no jurisdiction to grant such relief. The suit was therefore not barred on the face of the plaint, and the learned Single Judge erred in invoking Section 34 of the SARFAESI Act.
Conclusion: The civil suit was maintainable and the plaint could not be rejected under Order VII Rule 11 of the Code of Civil Procedure, 1908 on the ground of statutory bar.
Final Conclusion: The order rejecting the plaint was set aside and the suit was restored for adjudication on merits before the civil court.
Ratio Decidendi: A civil court can entertain a suit for cancellation of a registered sale deed, and such a suit is not barred merely because the property is connected with SARFAESI proceedings, since the Debt Recovery Tribunal lacks jurisdiction to cancel a registered conveyance; at the stage of Order VII Rule 11, the plaint must be read as a whole and cannot be rejected where it discloses allegations requiring trial.
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