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2016 DIGILAW 169 (JK)

Ashok Kumar v. Mohd. Yousuf Malik

2016-04-05

ALI MOHAMMAD MAGREY

body2016
ORDER : Ali Mohammad Magrey, J. 1. Petitioners have filed the petition invoking the jurisdiction of this Court under S. 104 of the Constitution of Jammu and Kashmir read with S. 151 of the Code of Civil Procedure (CPC) for quashing order dated 13-12-2013 passed by the learned Additional District Judge, Baramulla, in an application filed by the petitioners under O. VII, R. 11, CPC seeking rejection of the plaint in the suit titled Mohammad Yousuf Malik and another v. Ashok Kumar Bhat and others. 2. Briefly put, the case of petitioners 1 and 2 herein represented by their atorney, petitioner No. 3, is this : that petitioners 1 and 2 are migrants, presently residing at Udhampur. They own a single storied house along with land underneath and appurtenant thereto, measuring 11 Kanals and 16 Marlas, falling under survey No. 990/39, Khewat No. 14 and Khata No. 372, situated at Sopore, District Baramulla, Kashmir. The private respondents herein illegally claimed the transfer of aforesaid property in favour of private respondents 1 and 2 on the basis of execution of a power of attorney and agreement to sell fraudulently attributed to the petitioners, which, the petitioners aver, they have never executed. It is averred in the petition that on learning about the aforesaid documents, they challenged the legality thereof in a suit which is sub-judice in the Court of Sub-Judge at Udhampur. According to the petitioners, respondents 1 and 2 caused their appearance in the aforesaid suit and filed an application under O. VII, R. 11, CPC seeking rejection of the plaint, inter-alia, on the grounds that the property being a migrant property, the jurisdiction of the Court to try the suit was barred under S. 8 of the J & K Migrants Immovable Property (Preservation, Protection and Restraint on Distress Sales) Act, 1997 (hereinafter, Migrant Properties (PPRDS) Act) and that, in this regard, there was a self-contained procedure provided by the aforesaid Act. Respondents 1 and 2, accordingly, sought leave to file written statement. The application so filed by respondents 1 and 2 was rejected by the learned Sub-Judge, Udhampur, by order dated 23-9-2010. Against the said order, respondents 1 and 2 are stated to have filed a civil revision, bearing No. 115/2010, which is stated to be pending before the Jammu Wing of this Court. 3. The application so filed by respondents 1 and 2 was rejected by the learned Sub-Judge, Udhampur, by order dated 23-9-2010. Against the said order, respondents 1 and 2 are stated to have filed a civil revision, bearing No. 115/2010, which is stated to be pending before the Jammu Wing of this Court. 3. Meanwhile, respondents 1 and 2 filed a suit before the Court of Additional District Judge, Baramulla, seeking a decree of specific performance of the aforesaid agreement to sell and for an injunction to direct the official respondents 4 to 7 to issue permission for alienation of the property in question. 4. The petitioners herein appeared before the learned trial Court and filed an application under O. VII, R. 11, CPC for rejection of the plaint on the grounds stated therein. The learned Additional District Judge, Baramulla, disallowed the said application filed by the petitioners herein in terms of the impugned order dated 13-12-2013. Feeling aggrieved thereby, the petitioners have challenged the same in this petition. 5. The private respondents have filed their objections/reply. However, the official respondents have not filed any objections. 6. Respondents 1 and 2 in their reply have averred that the petitioners on 23-1-2009 executed an agreement to sell vis-a-vis the property in question in favour of respondent No. 2 and a power of attorney in favour of respondent No. 1, which execution took place at the Court premises at Udhampur. The consideration amount was fixed at Rs.12.00 lacs, which amount was paid to the petitioners 1 and 2 and the possession of the property was handed over by them to the answering respondents. It is averred that petitioners 1 and 2 also authorised the respondents to file a case for permission to sell the property before the authorities concerned that the papers for grant of permission were pending before the Divisional Commissioner, Kashmir. It is, however, stated that the petitioners, by their act and conduct, backed out from execution of the sale deed, compelling the plaintiff-respondents to file a suit for specific performance of the contract and for injunction. It is also stated that keeping in view the period of limitation, the respondents-plaintiffs were within their right to file the suit at Baramulla. 7. It is further stated that the Migrant Properties (PPRDS) Act and the J & K Migrants (Stay of Proceedings) At, 1997 (hereinafter. It is also stated that keeping in view the period of limitation, the respondents-plaintiffs were within their right to file the suit at Baramulla. 7. It is further stated that the Migrant Properties (PPRDS) Act and the J & K Migrants (Stay of Proceedings) At, 1997 (hereinafter. Stay of Proceedings Act) do not deprive the migrants of their ownership over the property and that their right to sell the property is preserved. 8. Respondents 1 and 2 further state in their reply that the petitioners have not challenged the agreement to sell; they have challenged only the power of attorney executed in favour of respondent No. 1. It is admitted that the learned Sub-Judge, Udhampur, dismissed the application filed by the respondents for return of the plaint to the petitioners (petitioners herein) on the ground that the Court did not have jurisdiction to try the suit and that respondent No. 1 filed a revision against the said order of dismissal of the application which is pending before the High Court. It is, however, contended that pendency of revision petition would not deprive the respondents from their right to initiate proceedings for specific performance of the contract. 9. The respondents have defended the impugned order, stating that there is no infirmity therein and that, in view of the language of S. 11(d) of CPC, the Court has only to look into the pleadings in a suit to come to an opinion whether the suit is barred by law or not. 10. The case was listed for admission on 22-3-2016. The learned counsels for the parties, however, opted to argue the case for final disposal. The learned counsel were, accordingly, heard. The petition shall, therefore, be deemed to have been admitted to hearing. 11. Mr. Moomin Khan, learned counsel for the petitioners raised two points during the course of his arguments. His first argument was that the learned trial Court has wrongly placed reliance on the judgment in Gh. Rasool Bhat v. Badrinath Bhat, 2008 (II) SLJ 787 : AIR 2009 J & K 53 in that, firstly, therein the contract between the parties was, in fact, an agreement to sell; secondly its execution was admitted; thirdly the promiser-vendor therein had agreed to execute a sale deed with the promisee-vendee; and fourthly the Court therein found that the parties to the agreement had breached the contract. Referring to the relevant paragraphs of the judgments, particularly para 10 thereof, learned counsel submitted that the Hon'ble Court laid down that "when the parties claim breach of contract, the specific performance is not barred" and that "same is enforceable more particularly when the execution of the agreement to sell is admitted." In that case, the learned counsel submitted, whereas the buyers claimed that the seller had failed to execute the sale deed, the seller claimed that "some of the instalments" on account of consideration fixed were not received by them. It is in that context that, when the Hon'ble Court found that the parties claimed breach of the contract; otherwise there was an agreement of sale and purchase, it was held that "when the parties claim breach of contract, the specific performance is not barred." The learned counsel submitted that the Hon'ble Court has not held that an agreement to sell would be enforceable in all eventualities or circumstances - whether or not its execution is admitted and whether or not the parties claim commission of breach of contract. He submitted that in the instant case, firstly, the execution of the document is not admitted by the petitioners; secondly, the document of which specific performance is sought does not contain any covenant about execution of any sale deed by the petitioners; and thirdly, in view of the recitals of the document, it cannot by any standard be termed to be an agreement to sell or a contract between the parties, specific performance whereof could be sought. In short, according to the learned counsel, the document does not contain any covenant or agreement attributing any act to be performed by the petitioners, constituting a contract, specific performance whereof could be sought by the private respondents. Therefore, according to the learned counsel, the judgment in Gh. Rasool Bhat v. Badrinath Bhat (supra) is not applicable in the instant case. According to the learned counsel, the provision of S. 8 of the Migrant Properties (PPRDS) Act is wholly attracted in the instant case with its entire rigour. Therefore, the trial Court has committed a grave error in having relied upon the said judgment and rejecting the application filed by the petitioners. 12. According to the learned counsel, the provision of S. 8 of the Migrant Properties (PPRDS) Act is wholly attracted in the instant case with its entire rigour. Therefore, the trial Court has committed a grave error in having relied upon the said judgment and rejecting the application filed by the petitioners. 12. His second argument is that, admittedly, a submission was made before the learned trial Court on the question of stay of proceedings in the suit in terms of the provision of S. 3 of the Jammu and Kashmir Migrant (Stay of Proceedings) Act, 1997 (for short, Stay of Proceedings Act) and the learned trial Court duly took note of the argument and the provision of law. But then, the trial Court held that the proceedings are to be stayed only on the application of the party. The learned counsel submitted that the learned trial Court has not been able to get the spirit of the judgment in Madan Lal Sahani v. Satpal Sahani, 2004 (II) SLJ 605. Referring to the relevant portion of the judgment, the learned counsel submitted that the spirit of the judgment is that the party concerned has to seek implementation of S. 3 of the Stay of Proceedings Act and not allow the proceedings to continue, and that the same could be achieved by making an oral request to the Court which, in fact, was done in the instant case. Therefore, the trial Court ought to have stayed the proceedings. 13. Mr. Z.A. Qureshi, learned senior counsel, on the other hand submitted that the petitioners have not only executed the agreement to sell, but have also executed two affidavits and a power of attorney, besides, duly submitting an application to the Deputy Commissioner in the prescribed format for grant of permission to alienate the property in question in favour of respondent No. 2 and addressed a written letter of authority to the Deputy Commissioner, Baramulla, with copies to Sr. Superintendent of Police, Tahsildar and the SHO Police Station concerned intimating to them about the deal between them and respondents herein in respect of the property as reflected by the documents. Superintendent of Police, Tahsildar and the SHO Police Station concerned intimating to them about the deal between them and respondents herein in respect of the property as reflected by the documents. The learned senior counsel submitted that the object of the provisions of the two Acts is only to ensure that sale of immovable migrant property is not made in distress; otherwise the two Acts do not take away the right of sale of a migrant. He further submitted that the provisions of the Migrant Properties (PPRDS) Act do not bar execution of every kind of instrument by a migrant. The learned senior counsel vehemently defended the impugned order and placed reliance on the judgment of the Court in Gh. Rasool Bhat v. Badrinath Bhat (AIR 2009 J & K 53) (supra). As regards the argument of the learned counsel for the petitioners that the trial Court ought to have stayed proceedings in terms of S. 3 of the Stay of Proceedings Act on the oral submission of the learned counsel, the learned senior counsel submitted that the provision relates only to a migrant. Whether a person is a migrant is a question of fact to be determined by holding an enquiry Therefore, the proceedings cannot be stayed on an oral submission made during the course of arguments. To support his argument, the learned senior counsel cited and relied upon the decision of a Co-ordinate Bench of this Court in M/s. Hotel Ellora v. Shamboo Nath Sopori, 2009 (I) SLJ 116. 14. I have considered the rival submissions of the learned counsel for the par ties and am of the opinion that insofar as the first limb of the argument of the learned counsel for the petitioners relating to the document, the specific performance whereof is sought, is concerned, the same is squarely covered by the law laid down by the Supreme Court in Suraj Lamp and Industries (P) Ltd. v. State of Haryana (2012) I SCC 656 : AIR 2012 SC 206 , read with the decision of the Co-ordinate Bench of this Court in Gh. Rasool Bhat v. Badrinath Bhat (supra). 15. Rasool Bhat v. Badrinath Bhat (supra). 15. There is no doubt that the recitals of the document, though captioned ‘as agreement to sell,’ do not contain any clause binding the petitioners to execute a stile deed or to do any act in future and, instead appears to convey the property without any condition, but the document cannot be termed anything other than an agreement to sell. The document contains in all four clauses. The first clause, though not fully legible from the copy of the document placed on the original suit record, appears to be relating to receipt of payment of the consideration amount of Rs.12.00 lacs by the petitioners. The rest of the three clauses are not worthy and are quoted hereunder: "2. That the parties of the 1st part assures the party No. 2nd that the said property is free from all charges and encumbrances. 3. That from today’s date onwards neither the parties of the first part nor any of the legal heirs of the parties of the first part shall have any right, title or claim over the said alienated property while as the party No. 2nd shall be the lawful owner from today’s date onwards and the party No. 2nd shall enjoy the possession of the said landed property in any manner he likes. 4. That the parties of the first part and their legal heirs shall have no objection if the landed property is transferred in the name of party No. 2nd in the concerned revenue record." 16. The recitals of the document, on their bare perusal, appear, to wholesomely and unconditionally, convey the property, but the vendee, that is the beneficiary of the document, himself styles it to be an agreement to sell, inasmuch as he has filed the suit for its specific performance. It is another thing that in the suit, the plaintiff-respondent has pleaded that he is owner in possession of the land. The fact remains that the document is shown to have been executed on two stamp papers of the denomination of Rs. 10/- each. Therefore, it cannot be treated as a deed of conveyance for any purpose whatsoever. It may be observed here that the practise of executing such or similar documents has been in vogue in the country since long. The fact remains that the document is shown to have been executed on two stamp papers of the denomination of Rs. 10/- each. Therefore, it cannot be treated as a deed of conveyance for any purpose whatsoever. It may be observed here that the practise of executing such or similar documents has been in vogue in the country since long. The matter came up for consideration before the Supreme Court in Suraj Lamp and Industries (P) Ltd. v. State of Haryana ( AIR 2012 SC 206 ) (supra) and the Supreme Court made the following observations : "By an earlier order dated 15-5-2009 (reported in Suraj Lamp and Industries Pvt. Ltd. v. State of Haryana & Anr., 2009 (7) SCC 363 : AIR 2009 SC 3077 , we had referred to the ill-effect of what is known as General Power of Attorney Sales (for short ‘GPA Sales’) or Sale Agreement/General Power of Attorney/Will transfers (for short ‘SA/GPA/ WILL’ transfers). Both the descriptions are misnomers as there cannot be a sale by execution of a power of attorney nor can there be a transfer by execution of an agreement of sale and a power of attorney and will. As noticed in the earlier order, these kinds of transactions were evolved to avoid prohibitions/conditions regarding certain transfers, to avoid payment of stamp duty and registration charges on deeds of conveyance, to avoid payment of capital gains on transfers, to invest unaccounted money (black money) and to avoid payment of ‘unearned increases’ due to Development Authorities on transfer. 2. The modus operandi in such SA/GPA/ WILL transactions is for the vendor or person claiming to be the owner to receive the agreed consideration, deliver possession of the property to the purchaser and execute the following documents or variations thereof: (a) An agreement of sale by the vendor in favour of the purchaser confirming the terms of sale, delivery of possession anti payment of full consideration and undertaking to execute any document as and when requi red in future. Or An agreement of sale agreeing to sell the property, with a separate affidavit confirming receipt of full price and delivery of possession and undertaking to execute sale deed whenever required. (b) An Irrevocable General Power of Attorney by the vendor in favour of the purchaser or his nominee authorizing him to manage, deal with and dispose of the property without reference to the vendor. (b) An Irrevocable General Power of Attorney by the vendor in favour of the purchaser or his nominee authorizing him to manage, deal with and dispose of the property without reference to the vendor. Or A General Power of Attorney by the vendor in favour of the purchaser or his nominee authorizing the attorney holder to sell or transfer the property and a Special Power to Attorney to manage the property. (c) A will bequeathing the property to the purchaser (as a safeguard against the consequences of death of the vendor before transfer is effected). 3. These transactions are not to be confused or equated with genuine transactions where the owner of a property grants a power of attorney in favour of a family member or friend to manage or sell his property, as he is not able to manage the property or execute the sale, personally. These are transactions, where a purchaser pays the full price, but instead of getting a deed of conveyance gets a SA/GPA/WILL as a mode of transfer, either at the instance of the vendor or at his own instance." Having so observed, the Supreme Court spelled out the ill-effects of such instruments, the relevant legal provisions of the Transfer of Property Act, the documents of which registration is compulsory, advantages of registration, scope of an agreement of sale, scope of power of attorney, scope of will etc. and concluded the discussion in para 24 of the judgment in the following words: "We therefore reiterate that immovable property can be legally and lawfully transferred/ conveyed only by a registered deed of conveyance. Transactions of the nature of ‘GPA sales’ or SA/GPA/WILL transfers’ do not convey title and do not amount to transfer, nor can they be recognised or valid mode of transfer of immoveable property. The Courts will not treat such transactions as completed or concluded transfers or as conveyances as they neither convey title nor create anv interest in an immovable property. They cannot be recognised as deeds of title, except to the limited extent of S. 53-A of the TP Act. Such transactions cannot be relied upon or made the basis for mutations in Municipal or Revenue Records. What is stated above will apply not only to deeds of conveyance in regard to freehold property but also to transfer of leasehold property. Such transactions cannot be relied upon or made the basis for mutations in Municipal or Revenue Records. What is stated above will apply not only to deeds of conveyance in regard to freehold property but also to transfer of leasehold property. A lease can be validly transferred only under a registered Assistant of Lease. It is time that an end is put to the pernicious practise of SA/GPA/WILL transactions known as GPA sales." In paragraphs 26 and 27 of the judgment, the Supreme Court further laid down as under: "26. We have merely drawn attention to and reiterated the well-settled legal position that SA/GPA/WILL transactions are not ‘transfers’ or ‘sales’ and that such transactions cannot be treated as completed transfers or conveyances. They can continue to be treated as existing agreement of sale. Nothing prevents affected parties from getting registered deeds of conveyance to complete their title. The said ‘SA/GPAAVILL transactions’ may also be used to obtain specific performance or to defend possession under section 53A of TP Act. If they are entered before this day, they may be relied upon to apply for regularization of allotments/ leases by Development Authorities. We make it clear that if the documents relating to ‘SA/ GPA/WILL transactions’ has been accepted acted upon by DDA or other developmental authorities or by the Municipal or revenue authorities to effect mutation, they need not be disturbed, merely on account of this decision. 19. We make it clear that our observations are not intended to in any way affect the validity of sale agreements and powers of attorney executed in genuine transactions. For example, a person may give a power of attorney to his spouse, son, daughter, brother, sister or a relative to manage his affairs or to execute a deed of conveyance. A person may enters into a development agreement with a land developer or builder for developing the land either by forming plots or by constructing apartment buildings and in that behalf execute an agreement of sale and grant of Power of Attorney empowering the developer to execute agreements of sale or conveyances in regard to individual plots of land or undivided shares in the land relating to apartments in favour of prospective purchasers. In several States, the execution of such development agreements and powers of attorney are already regulated by law and subjected to specific stamp duty. In several States, the execution of such development agreements and powers of attorney are already regulated by law and subjected to specific stamp duty. Our observations regarding ‘SA/GPA/WILL transactions’ are not intended to apply to such bona fide/ genuine transactions." (Underlining supplied) It is to be borne in mind that there is no provision akin to S. 53-A of the Transfer of Property Act as applicable in rest of the country, in the Transfer of Property Act applicable in the State of J. & K., and the concept of part performance is unknown to the law applicable in the State. Apart from that, the question of delivery of possession of migrant properties, without previous permission from the competent authorities in the State does not arise, since, in terms of law, the District Magistrate of a District is deemed to possess the migrant properties. 17. What is relevant to say here is that in the State, especially in the Valley of Kashmir, a somewhat similar system of transactions and instrumentation has been in vogue vis-a-vis the migrant properties since long. And the one involved in the present case is no exception. As laid down by the Supreme Court in para 26 of the judgment, such documents have to be treated as existing agreements of sale. Therefore, in the instant case, as well the document in question cannot be treated anything more than an agreement to sell or anything less than that, of course, unless its execution is effectively and adequately denied in appropriate proceedings and established to be so, and subject to just exceptions of law. 18. Herein the petitioners have not denied, impliedly or expressly, that they have not executed the agreement to sell. Though they have said in the writ petition that they have challenged in same in a suit, but nothing has been brought on record to establish that assertion. On the other hand, it is categorically stated by the respondents that the agreement to sell is not the subject-matter of challenge in the suit pending in the Court of Udhampur. Therefore, mere non-admission of the execution would not amount to denial of execution. Furthermore, even if a party has to deny execution of the agreement, such a defence can also be taken in the suit for specific performance. Therefore, mere non-admission of the execution would not amount to denial of execution. Furthermore, even if a party has to deny execution of the agreement, such a defence can also be taken in the suit for specific performance. In that view of the matter, I do not see that the trial Court has committed any error in placing reliance on the judgment in Gh. Rasool Bhat v. Badrinath Bhat (AIR 2009 J & K 53) (supra) to the extent that provision of S. 8 of the Migrant Properties (PPRDS) Act was not attracted in the suit for specific performance of the agreement to sell in question. 19. Now, coming to the other argument relating to S. 3 of the Stay of Proceedings Act. Of course, from a perusal of the judgment in Madan Lal Sahani v. Satpal Sahani (supra), the crux thereof appears to be that a party should not allow the proceedings in a suit to continue and then take up the objection at the final stage. But, as rightly argued by Mr. Qureshi, whether a party to an agreement to sell continues to be a migrant is a question of fact to be determined and such determination can be made only by conducting an enquiry. Such an enquiry can be conducted by a Court only when there is a motion to which objections would need to be filed by the other side bringing the real and relevant facts in that context before the Court. In that view, I think, the mandate of S. 3 of the Stay of Proceedings Act cannot be invoked on oral submission; there has to be an application in writing on the part of the party concerned seeking stay of the proceedings. It hardly needs a mention that the petitioners’ right to make such a motion before the trial Court subsists even now and, if made, the trial Court will consider the same in accordance with law. 20. One important thing needs a mention here : that is, in Gh. Rasool Bhat v. Badrinath Bhat (supra), even while holding that when the parties claim breach of contract, the specific performance is not barred, the Court has not held that the mandate of S. 3 of the Stay of Proceedings Act would not be attracted. 20. One important thing needs a mention here : that is, in Gh. Rasool Bhat v. Badrinath Bhat (supra), even while holding that when the parties claim breach of contract, the specific performance is not barred, the Court has not held that the mandate of S. 3 of the Stay of Proceedings Act would not be attracted. Instead in paragraph 9, what has been held is that in that case the trial Court had wrongly quoted that J. & K. Migrant (Stay of Legal Proceedings) Act, 1997 was promulgated after the J. & K. Migrant Immovable Property (Preservation, Protection and Restraint on Distress Sales) Act, 1997, therefore, proceedings are not required to be stayed. The Court in this connection held "this aspect of the matter has not been correctly appreciated. The relevant paragraph of the judgment is quoted hereunder: "9. The learned trial Court has wrongly quoted that Jammu and Kashmir Migrant (Stay of Legal Proceedings) Act, 1997 was promulgated after the Jammu and Kashmir Migrant Immovable Property (Preservation, Protection and Restraint and Distress Sales) Act, 1997, therefore, proceedings are not required to be stayed. This aspect of the matter has not been correctly appreciated. The trial Court has wrongly referred the Act Nos. 16 and 17 and on that analogy has concluded that the Jammu and Kashmir Migrant (Stay of Legal Proceeding) Act, 1997 has been promulgated at the later point of time which is not correct." 21. Even otherwise, the issue was no more res integra when the judgment in Gh. Rasool Bhat v. Badrinath Bhat (supra) was delivered by the Court in 2008 as the same had been examined and decided by the judgment in Madan Lal Sahani v. Satpal Sahani (supra) delivered in 2004. 22. For all what has been discussed and observed above, it is held that no exception can be taken to the order passed by the learned trial Court insofar as the same holds that the plaint instituted cannot be rejected on the ground of being barred under Ss. 3 and 8 of the Migrants Immovable Property (Preservation, Protection and Restraint on Distress Sales) Act, 1997 and further that for staying the proceedings under S. 3 of the Jammu and Kashmir Migrant (Stay of Legal Proceedings) Act, 1997, the petitioners would need not make a formal application in that regard. 23. 3 and 8 of the Migrants Immovable Property (Preservation, Protection and Restraint on Distress Sales) Act, 1997 and further that for staying the proceedings under S. 3 of the Jammu and Kashmir Migrant (Stay of Legal Proceedings) Act, 1997, the petitioners would need not make a formal application in that regard. 23. This writ petition is, accordingly, disposed of together with the connected CMP, vacating the interim direction, if any, subsisting. 24. No order as to costs. 25. Registry to return the original records of the case forthwith to the trial Court along with a copy of this order. Order accordingly.