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2014 DIGILAW 188 (CAL)

Suresh Kumar Gupta v. Samarendra Nath Shaw

2014-03-06

DEBANGSU BASAK

body2014
JUDGMENT : Debangshu Basak, J. Disputes revolved around two immovable properties at Ramudulal Sarkar Street, Kolkata. The plaintiffs and the original Defendant No. 5 were brothers. They entered into two several agreements both dated March 25, 1975 with the Defendant Nos. 1 to 4 for purchasing two immovable properties. During the subsistence of such agreements, the original Defendant No. 5 along with his wife filed a suit for specific performance of an alleged oral agreement in respect of the two immovable properties. In such suit the plaintiffs were not made parties. They applied for injunction in such suit. On refusal of an order of injunction, the original Defendant No. 5 and his wife preferred an appeal. In the appeal, the Defendant No. 5 and his wife entered into a compromise with the Defendant Nos. 1 to 4 and a decree dated March 7, 1984 was passed to the effect that, the Defendant Nos. 1 to 4 would sell the two immovable properties to the original Defendant No. 5 and his son. 2. According to the plaintiffs, they were not aware of the compromise decree. Immediately upon coming to know of the compromise decree, the plaintiffs applied before the Appeal Court. The Appeal Court granted them leave to file the instant suit by the Order dated June 4, 1984. The instant suit was filed challenging the compromise decree passed in the appeal. 3. During the pendency of the instant suit, few defendants died. They were duly substituted. The Defendant Nos. 1 to 4 filed one set of written statement. The original Defendant No. 5 and the Defendant No. 6 filed another set of written statement. The plaintiff produced the Plaintiff No. 1 as its witness. The Defendant' Nos. 1 to 4 produced original Defendant No. 2 as its witness while the Defendant No. 5A gave evidence for the original Defendant No. 5 and the Defendant No. 6. Few documents were marked exhibits on behalf of the parties to the proceedings. 4. After conclusion of the evidence, the suit was taken up for hearing of the arguments of the parties. In course of such arguments, the first issue considered was whether a Single Judge could declare consent decree passed by a Division Bench to be null and void and set aside the same. Consideration of such issue was recorded in the Order dated August 20, 2007. In course of such arguments, the first issue considered was whether a Single Judge could declare consent decree passed by a Division Bench to be null and void and set aside the same. Consideration of such issue was recorded in the Order dated August 20, 2007. The parties addressed the Court on such issue. Such issue was deliberated upon and by an Order dated September 20, 2007 it was held that, an Inferior Court was competent to entertain a suit in which prayer was made to set aside a decree passed by a Superior Court on the ground of fraud. The issue recorded in the Order dated August 20, 2007 was answered in the affirmative by the Order dated September 20, 2007. Both the aforesaid orders were passed in presence of the parties. No appeal was carried. 5. Subsequent to the Order dated September 20, 2007 the arguments in the suit continued. The defendants did not appear. It was submitted on behalf of the plaintiffs that, it would not be proper to revisit the issue which was answered in the affirmative on September 20, 2007. This, according to me, was the correct view particularly when the hearing in the suit was in continuation from the stage left after September 20, 2007. 6. Premises No. 139, Ramudulal Sarkar Street, Kolkata and Premises Nos. 140 and 140/1, Ramudulal Sarkar Street, Kolkata were analogous to one another. Both the two immovable properties were owned by the Defendant Nos. 1 to 4 series. The ownership of the aforesaid two premises by the Defendant Nos. 1 to 4 series was an admitted fact. The relevant averments of the plaint in this regard were not denied by the defendants in their written statements. Title to the immovable properties was not in dispute. 7. On March 25, 1975 two agreements for sale was entered into in respect of these two immovable properties. One agreement of sale related to Premises No. 139, Ramudulal Sarkar Street, Kolkata. This agreement was entered into between the Plaintiff No. 1 and the original Defendant No. 5 on one part and the Defendant Nos. 1 to 4 series on the other part. The other agreement for sale was in respect of Premises Nos. 140 and 140/1, Ramudulal Sarkar Street, Kolkata. The second agreement was between the Plaintiff No. 2 on one part and the Defendant Nos. 1 to 4 series on the other. 1 to 4 series on the other part. The other agreement for sale was in respect of Premises Nos. 140 and 140/1, Ramudulal Sarkar Street, Kolkata. The second agreement was between the Plaintiff No. 2 on one part and the Defendant Nos. 1 to 4 series on the other. 8. The agreement for sale dated March 25, 1975 required the owners to produce Income Tax clearance certificate and clearance under the Urban Land (Ceiling and Regulation) Act, 1976. The Defendant Nos. 1 to 4 failed to produce such clearances. 9. In cross-examination the plaintiff witness No. 1 stated that, the Defendant Nos. 1 to 4 were not in a position to obtain the Income Tax clearance and the clearance under the Urban Land (Ceiling and Regulation) Act, 1976. In such view the plaintiff witness No. 1 stated that, an agreement for tenancy was entered into and that the three brothers were put in possession of the two immovable properties as tenants. This agreement for tenancies according to Plaintiff No. 1, was a combined agreement of tenancy as well as an agreement of sale. According to the plaintiff witness No. 1 the agreement for sale stood modified by this agreement for tenancy cum agreement for sale. 10. Subsequent to the tenancies, the tenants were paying rent to the Defendant Nos. 1 to 4. Rent receipts in this regard were disclosed in evidence and marked exhibits. There was no denial of the tenancy. 11. The agreement for sale between the parties did not fructify to a conveyance till March, 1982. By a letter dated March 3, 1982 which was marked as Exhibit 5', the Advocate for the Defendant Nos. 1 to 4 stated that draft conveyances were approved by the vendors in 1975. The time stipulated for completion was June 30, 1976. The vendors wanted to cancel the agreement for sale and forfeit the earnest money. However, they afforded another opportunity to the plaintiffs and the original Defendant No. 5 to complete the transactions. The time for completion was extended till March 15, 1982. 12. The conveyances were not executed within March 15, 1982. According to the original Defendant No. 5 and the Defendant No. 6, the Defendant Nos. 1 to 4 cancelled the agreements for sale dated March 25, 1975 on the ground of delay. The time for completion was extended till March 15, 1982. 12. The conveyances were not executed within March 15, 1982. According to the original Defendant No. 5 and the Defendant No. 6, the Defendant Nos. 1 to 4 cancelled the agreements for sale dated March 25, 1975 on the ground of delay. Subsequently, it was claimed by the original Defendant No. 5 and the Defendant No. 6 that, an oral agreement was entered into between the original Defendant No. 5 and his wife on one part, the Defendant Nos. 1 to 4 on the other in respect of the two immovable properties. The Defendant Nos. 1 to 4 failing to honour such agreement, the original Defendant No. 5 and his wife filed a suit being Suit No. 850 of 1982 against the Defendant Nos. 1 to 4 in this Hon'ble Court. In such suit an application for injunction was filed. An interim injunction was granted initially which was vacated. The oral agreement was not believed at the interlocutory stage. An appeal against the order vacating the injunction order was carried. In such appeal a compromise was entered into on March 7, 1984. This compromise was entered into between the original Defendant No. 5 and his wife on one part and the Defendant Nos. 1 to 4 on the other part. By such compromise the Defendant Nos. 1 to 4 agreed to convey the two immovable properties to the original Defendant No. 5 and his son for a total consideration of Rs. 1,40,000/-. Upon payment of such agreed consideration the Defendant Nos. 1 to 4 agreed to execute and register six conveyances in respect of the two immovable properties. The breakup of the consideration for the properties was provided in the Appeal Court's order. 13. This compromise decree was under challenge in this suit. The plaintiffs were not parties to Suit No. 850 of 1982. The original Defendant No. 5 and the Defendant No. 6 sought to justify the absence of the plaintiff in Suit No. 850 of 1982 on the ground that they were not necessary and proper parties. This was their stand in Paragraph 5 of the written statement. 14. None of the defendants produced any documents to establish that, the plaintiffs accepted the termination of the agreement for sale dated March 25, 1975. This was their stand in Paragraph 5 of the written statement. 14. None of the defendants produced any documents to establish that, the plaintiffs accepted the termination of the agreement for sale dated March 25, 1975. Exhibit 5' being the letter dated March 3, 1982 gave the three brothers, namely, the plaintiffs and the original Defendant No. 5 time till March 15, 1982 to complete the transaction in terms of the agreement for sale dated March 25, 1975. Therefore, the agreement for sale dated March 25, 1975 was surviving till March 15, 1982. No document was shown nor any evidence adduced to establish that the plaintiffs give up their rights under the agreement for sale dated March 25, 1975. The rights of the plaintiffs under the agreement for sale dated March 25, 1975, therefore, survived till March 15, 1982 being the last date according to the Advocate for the Defendant Nos. 1 to 4 to complete the transaction. 15. The right of the plaintiffs in respect of the two immovable properties continued up to March 15, 1985. Nothing being shown that the plaintiffs gave up such rights subsequent to March 15, 1982, the plaintiffs were both necessary and proper parties in any suit relating to the title of the two immovable properties concerned. The suit filed by the Defendant No. 5 and his wife being Suit No. 850 of 1982, in absence of the plaintiffs being parties thereto, could not affect the right, title and interest of the plaintiffs in respect of the two immovable properties by any decree passed in such suit. The plaintiffs, therefore, could not be bound by any decree that was passed in Suit No. 850 of 1982. 16. Now, came the question, whether the decree dated March 7, 1984 was obtained fraudulently or not. 17. The Defendant No. 5 and his wife were the plaintiffs of Suit No. 850 of 1982. The defendants in such suit were the Defendant Nos. 1 to 4 in the instant suit. Therefore, all such parties in Suit No. 850 of 1982 knew of the subsisting right of the plaintiffs in respect of the two immovable properties concerned when such suit was filed and when the parties to such suit were entering into a compromise in respect of the title of the two immovable properties. 1 to 4 in the instant suit. Therefore, all such parties in Suit No. 850 of 1982 knew of the subsisting right of the plaintiffs in respect of the two immovable properties concerned when such suit was filed and when the parties to such suit were entering into a compromise in respect of the title of the two immovable properties. It was, therefore, the bounden duty of the parties to Suit No. 850 of 1982 to apprise the Court passing the compromise decree as to the subsisting right, title and interest of the plaintiffs in respect of the two immovable properties. In fact, plaintiffs were both necessary and proper parties in Suit No. 850 of 1982. The Court passing the compromise decree was not apprised of the existing rights of the plaintiffs in Suit No. 850 of 1982. This was suppression of a material fact and done deliberately. This suppression affected the rights of the plaintiffs to the immovable properties. The parties to Suit No. 850 of 1982 actively concealed a material fact from Court which such fact was well within their knowledge. The parties in Suit No. 850 of 1982, therefore, obtained the compromise decree fraudulently. 18. The defendants contended that, the plaintiffs had notice of Suit No. 850 of 1982. In support of such contention the Defendants contended that, the Plaintiff No. 1 was educated and had a law degree, The Plaintiff No. 1 used to interact with the Advocate on behalf of the three brothers. According to the Defendants, therefore, the plaintiffs had due knowledge and notice of Suit No. 850 of 1982. 19. This contention of the Defendants was not acceptable. The plaintiffs, if they were in the know, would not allow themselves to be denuded of a valuable right in respect of two immovable properties for no consideration. It was not contended on behalf of the defendants that, the plaintiffs gave up their rights for a consideration. 20. It was also contended on behalf of the original Defendant No. 5 and the Defendant No. 6 that, the original Defendant No. 5 paid the advances to the Defendant Nos. It was not contended on behalf of the defendants that, the plaintiffs gave up their rights for a consideration. 20. It was also contended on behalf of the original Defendant No. 5 and the Defendant No. 6 that, the original Defendant No. 5 paid the advances to the Defendant Nos. 1 to 4 and that in effect it was the original Defendant No. 5 himself who was purchasing the two immovable properties and that he merely added the name of his two other brothers and, therefore, the plaintiffs were not entitled to any right under the agreement for sale dated March 25, 1975. 21. This contention of the original Defendant No. 5 and the Defendant No. 6 were contrary to the records. One of the agreements for sale was between two brothers on one part and the Defendant Nos. 1 to 4 while the other was by one of the brothers with the Defendant Nos. 1 to 4. It could not be said that the original Defendant No. 5 alone entered into the two agreements for sale. 22. It was contended on behalf of the original Defendant No. 5 and the Defendant No. 6 that, the plaintiffs did not give any date when the plaintiffs became aware of the compromise decree. The plaintiffs also did not give any date when the search was made in the records of this Hon'ble Court. The Defendant Nos. 5 and 6 were not given any notice of such search being made. The Defendant Nos. 5 and 6 called upon the plaintiffs to give the date of search made in the records of this Hon'ble Court relating to the compromise decree. 23. In evidence the plaintiff witness No. 1 stated that, he became aware of the compromise decree when their father made inquiries as to the fate of the agreement for sale. According to him, it was after April 1, 1984 that the plaintiffs made searches and came to know of these facts. In cross-examination the plaintiff witness No. 1 reiterated his declared position. Nothing contrary to his stand came out in cross-examination. 24. On appreciation of the evidence led by both the parties I would accept the version of the plaintiff. Valuable rights of the plaintiffs were taken away by the compromise decree dated March 7, 1987. In cross-examination the plaintiff witness No. 1 reiterated his declared position. Nothing contrary to his stand came out in cross-examination. 24. On appreciation of the evidence led by both the parties I would accept the version of the plaintiff. Valuable rights of the plaintiffs were taken away by the compromise decree dated March 7, 1987. The contention that, the plaintiffs were not necessary and proper parties to Suit No. 850 of 1982 was not acceptable. No explanation was forthcoming as to why the earlier agreement for sale was not stated to be cancelled in the new compromise decree. The plaintiffs did not accept the termination of the agreement for sale dated March 25, 1975. In absence of such acceptance the plaintiffs were necessary and proper parties in Suit No. 850 of 1982. Nothing was shown to establish that the plaintiffs accepted the termination of the agreement dated March 25, 1975. Nothing was established on behalf of the defendants that, the plaintiffs were aware of the compromise decree when the same was passed and that they acquiesced therein. 25. Since the plaintiff established that, the compromise decree dated March 7, 1987 was obtained by fraud the same was required to be declared to be a nullity and of no effect. The plaintiff therefore would be entitled to a decree in terms of prayer (a) of the plaint. 26. Since the decree dated March 7, 1987 was declared to be null and void, the plaintiffs would also be entitled to a decree of perpetual injunction restraining the defendants from dealing with, disposing of, encumbering or alienating the suit properties in terms of the compromise decree dated March 7, 1987. 27. C.S. No. 461 of 1984 is decreed accordingly. The plaintiffs will be entitled to assessed costs of Rs. 50,000/-.