TaxTMI 
TaxTMI 
2020 (7) TMI 786
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....the ownership of the Plaintiffs. 3. The land was under restrictive tenure as per Section 73AA of the Land Revenue Code. The Plaintiffs filed an application dated 13.05.2008 before the Collector, Surat to obtain permission for selling the suit property to Respondent No. 1/Defendant No. 1, which was non-irrigated, and stated that they had no objection to the sale of the suit property. 4. The Collector vide Order dated 19.06.2009, after carrying out verification of the title of the Plaintiffs, permitted sale of the suit property, and fixed the sale price of the suit property as per the jantri issued by the State Government @ Rs. 2000/- per sq. mtr., which would work out to Rs. 1,74,02,000/-. The Collector granted permission for the sale subject to the terms and conditions contained in Section 73AA of the Land Revenue Code. It was stipulated that the purchaser shall make the payment by cheque, and reference of the payment shall be made in the Sale Deed. 5. After obtaining permission from the Collector, the Plaintiffs sold the suit property to Respondent No. 1 herein vide registered Sale Deed dated 02.07.2009. Respondent No. 1 - purchaser issued 36 cheques for Rs. 1,74,02,00....
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....Plaintiffs had participated in the proceedings before the Revenue Officer for transfer of the suit property in the revenue records in favour of Respondent No. 1. On that basis, the suit property had been transferred to Respondent No. 1 vide Hakk Patrak Entry No. 6517 dated 24.07.2009. Before certifying the said entry, notice Under Section 135D of the Land Revenue Code had been duly served on the Plaintiffs, and ever since, Respondent No. 1 had been paying the land revenue on the suit property, and taking the produce therefrom. Respondent Nos. 2 and 3 further submitted that they had purchased the suit property from Respondent No. 1 after verifying the title, and inspecting the revenue records. The Respondent No. 1 had sold the suit property vide a registered Sale Deed dated 01.04.2013, on payment of valuable consideration of Rs. 2,01,00,000/-. Pursuant thereto, the suit property was transferred in the name of Respondent Nos. 2 and 3 in the revenue records. It was further submitted that the Plaintiffs, with a view to mislead the Court, had deliberately filed copies of the 7/12 extracts dated 20.07.2009, which was prior to the mutation being effected in the name of Respondent No....
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....ques, their passbooks, bank statements, or any other document to support their averments in the plaint. A notice for transfer of the suit property in the revenue records Under Section 135D was served on the Plaintiffs, to which no objection was raised. The name of Respondent No. 1 was entered into the revenue records, which was certified by the Revenue Officer. The Trial Court held that the period of limitation for filing the suit was 3 years from the date of execution of the Sale Deed dated 02.07.2009. The suit was filed on 15.12.2014. The cause of action as per the averments in the plaint had arisen when the Defendant No. 1/Respondent No. 1 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 however filed on 15.12.2014, which was barred by limitation. The suit property was subsequently sold by Respondent No. 1 to Respondent Nos. 2 and 3 by a registered Sale Deed dated 01.04.2013. Before purchasing the suit property, the Respondent Nos. 2 and 3 had issued a public notice on 14.08.2012. T....
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.... Nos. 2 and 3, and there was no privity of contract between the Plaintiffs and Respondent Nos. 2 and 3. The High Court rightly affirmed the findings of the Trial Court, and held that the suit was barred by limitation, since it was filed beyond the period of limitation of three years. 11. Aggrieved by the impugned Judgment and Order dated 12.08.2016 passed by the High Court, the original Plaintiff No. 1 has filed the present Civil Appeal. 12. We have heard the learned Counsel for the parties, perused the plaint and documents filed therewith, as also the written submissions filed on behalf of the parties. 12.1 We will first briefly touch upon the law applicable for deciding an application Under Order VII Rule 11 Code of Civil Procedure, which reads 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 in 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 written upon paper insufficiently stamp....
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....t readily exercises the power to reject a plaint, if it does not disclose any cause of action. 12.2 The power conferred on the court to terminate a civil action is, however, a drastic one, and the conditions enumerated in Order VII Rule 11 are required to be strictly adhered to. 12.3 Under Order VII Rule 11, a duty is cast on the Court to determine whether the plaint discloses a cause of action by scrutinizing the averments in the plaint [Liverpool & London S.P. & I Assn. Ltd. v. M.V. Sea Success I and Anr., (2004) 9 SCC 512], read in conjunction with the documents relied upon, or whether the suit is barred by any law. 12.4 Order VII Rule 14(1) provides for production of documents, on which the Plaintiff places reliance in his suit, which reads as under: Order 7 Rule 14: Production of document on which Plaintiff sues or relies.- (1) Where a Plaintiff sues upon a document or relies upon document in his possession or power in support of his claim, he shall enter such documents in a list, and shall produce it in Court when the plaint is presented by him and shall, at the same time deliver the document and a copy thereof, to be filed with the plaint. (2) Where any suc....
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....o 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, (1999) 3 SCC 267; See also Vijay Pratap Singh v. Dukh Haran Nath Singh, AIR 1962 SC 941]. 12.8 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 VII Rule 11 Code of Civil Procedure. 12.9 The power Under Order VII Rule 11 Code of Civil Procedure 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, as held by this Court in the judgment of Saleem Bhai v. State of Maharashtra. (2003) 1 SCC 557. The plea that once issues are framed, the matter must necessarily go to trial was repelled by this....
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....laint. If, however, by clever drafting of the plaint, it has created the illusion of a cause of action, this Court in Madanuri Sri Ramachandra Murthy v. Syed Jalal (2017) 13 SCC 174 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. 14. 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. Articles 58 and 59 of the Schedule to the 1963 Act, prescribe the period of limitation for filing a suit where a declaration is sought, or cancellation of an instrument, or rescission of a contract, which reads as u....
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....unt of Rs. 1,73,62,000 were alleged to be "bogus" or "false", and allegedly remained unpaid. We find the averments in the Plaint completely contrary to the recitals in the Sale Deed dated 02.07.2009, which was admittedly executed by the Plaintiffs in favour of Respondent No. 1. In the Sale Deed, the Plaintiffs have expressly and unequivocally acknowledged that the entire sale consideration was "paid" by Defendant No. 1/Respondent No. 1 herein to the Plaintiffs. Clauses 3 and 4 of the Sale Deed are extracted hereinbelow for ready reference: Since the full amount of consideration of the sale as decided above, has since been paid by you the Vendees to we the Vendors of this sale deed, for which we the Vendors of this sale deed acknowledge the same so, we or our descendants, guardian or legal heirs is to take any dispute or objection in future that such amount is not received, or is received less, and if we do so then, the same shall be void by this deed and, if any loss or damage occurs due to the same then, we the Vendors of this sale deed and descendants, guardians, legal heirs of we the vendors are liable to the pay the same to you the vendees or your descendants, guardian....
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.... Manikrao and Anr. (1999) 3 SCC 573 this Court held that the words "price paid or promised or part paid and part promised" indicates that actual payment of the whole of the price at the time of the execution of the Sale Deed is not a sine qua non for completion of the sale. Even if the whole of the price is not paid, but the document is executed, and thereafter registered, the sale would be complete, and the title would pass on to the transferee under the transaction. The non-payment of a part of the sale price would not affect the validity of the sale. Once the title in the property has already passed, even if the balance sale consideration is not paid, the sale could not be invalidated on this ground. In order to constitute a "sale", the parties must intend to transfer the ownership of the property, on the agreement to pay the price either in praesenti, or in future. The intention is to be gathered from the recitals of the sale deed, the conduct of the parties, and the evidence on record. In view of the law laid down by this Court, even if the averments of the Plaintiffs are taken to be true, that the entire sale consideration had not in fact been paid, it could not be a groun....
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....upplied) The plea taken in the plaint that they learnt of the alleged fraud in 2014, on receipt of the index of the Sale Deed, is wholly misconceived, since the receipt of the index would not constitute the cause of action for filing the suit. On a reading of the plaint, it is clear that the cause of action arose on the non-payment of the bulk of the sale consideration, which event occurred in the year 2009. The plea taken by the Plaintiffs is to create an illusory cause of action, so as to overcome the period of limitation. The plea raised is rejected as being meritless and devoid of any truth. 15.5 The conduct of the Plaintiffs in not taking recourse to legal action for over a period of 5 and ½ years from the execution of the Sale Deed in 2009, for payment of the balance sale consideration, also reflects that the institution of the present suit is an after-thought. The Plaintiffs apparently filed the suit after the property was further sold by Respondent No. 1 to Respondent Nos. 2 and 3, to cast a doubt on the title of Respondent No. 1 to the suit property. 15.6 The Plaintiffs have placed reliance on the Order of the Collector dated 19.06.2009 with the plaint. The....
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.... 1, since it would be evident that the suit was barred by limitation. The prayer however mentions the date of the subsequent Sale Deed i.e. 01.04.2013 when the suit property was further sold by Respondent No. 1 to Respondent Nos. 2 & 3. The omission of the date of execution of the Sale Deed on 02.07.2009 in the prayer clause, was done deliberately and knowingly, so as to mislead the Court on the issue of limitation. 15.8 The delay of over 5 and ½ years after the alleged cause of action arose in 2009, shows that the suit was clearly barred by limitation as per Article 59 of the Limitation Act, 1963. The suit was instituted on 15.12.2014, even though the alleged cause of action arose in 2009, when the last cheque was delivered to the Plaintiffs. The Plaintiffs have 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 VII Rule 11(d) of Code of Civil Procedure. Reliance is placed on the recent judgment of this Court rendered in Raghwendra Sharan Singh v. Ram Prasanna Singh (Dead) by LRs. [Civil Appeal No. 2960/2019 decided on 13.03.2019] wherein this Court held the su....