K. Bhaskaran, S/o. late C. K. Govindan Nair v. Ratnamma, Wife of late Gundappa
2018-01-02
SREENIVAS HARISH KUMAR
body2018
DigiLaw.ai
JUDGMENT : 1. The plaintiff in O.S. 25570/2010 on the file of LVII Addl. City Civil and Sessions Judge, Bengaluru, has challenged the order dated 27.4.2016 passed on an application filed under Order VII Rule 11 of the Code of Civil Procedure. By the impugned order, the plaint was rejected. 2. Necessary facts in a nutshell for disposal of this appeal are as follows : The plaintiff instituted a suit for specific performance based on an agreement of sale dated 26.11.1984 executed by A.Gundappa, the husband of the first defendant and father of defendants 2 to 4, in respect of 4 sites bearing Nos. 29, 30, 35 and 36 formed in Sy. No. 149 of Agara Village, Begur Hobli, Bengaluru South Taluk, measuring 80 x 60 feet (hereafter referred to as ‘the suit property’). The plaintiff pleaded that Gundappa was the absolute owner of the suit property and on 26.11.1984 he executed an agreement of sale in favour of the plaintiff for selling the suit property to him for a total consideration of Rs.30,000/-. He received the entire amount and undertook to execute the sale deed at any time, but subject to condition that the title of the schedule property should be clear from all encumbrances. He also executed a General Power of Attorney and handed over the possession of the suit property to the plaintiff. Thereafter, the plaintiff constructed a house there and started living with his family members. A few months after this transaction, the Bengaluru Development Authority notified the land in Sy. No. 149 and the surrounding lands for acquisition by issuing a preliminary notification on 17.1.1985 followed by final notification dated 19.11.1986. The BDA took over the possession of the entire land in Sy. No. 149 from Gundappa except the suit property. The said Gundappa assured plaintiff that he would execute the sale deed soon after getting clearance from the BDA. He also filed a suit O.S.3604/1988 against BDA seeking permanent injunction restraining BDA from demolishing the existing construction in the suit property. Gundappa took action to see that this 2 acres 5 guntas of land in Sy. No. 149 acquired by BDA was denotified and ultimately the Government of Karnataka issued an order on 6.1.2010 denotifying the said land. Thus, Gundappa once again became the absolute owner of the land acquired by BDA.
Gundappa took action to see that this 2 acres 5 guntas of land in Sy. No. 149 acquired by BDA was denotified and ultimately the Government of Karnataka issued an order on 6.1.2010 denotifying the said land. Thus, Gundappa once again became the absolute owner of the land acquired by BDA. After the death of Gundappa, the defendants obtained the revenue records to their name after denotification. Since they are the legal representatives of Gundappa, the sale agreement is binding on them. The plaintiff was ready and willing to perform his part of the contract. He requested the defendants to execute the sale deed, but they did not heed to his request. He got issued a notice to them demanding the execution of the sale deed and then filed a suit. 3. On 28.8.2014, the defendants got filed an application under Order VII Rule 11 CPC seeking rejection of the plaint. The second defendant who swore to an affidavit stated that there was no cause of action for the plaintiff to institute a suit. After denotification of the lands which had been acquired, the defendants sold the said land in favour of third parties by executing sale deeds. The purchasers from them occupied the lands sold to them. The plaintiff is not in possession and that he has not produced a single document to show his possession. The plaintiff has suppressed the material facts and, therefore, there is no cause of action for the suit. For these reasons, the plaint has to be rejected. 4. It is pertinent to mention here that the trial court on 23.2.2015 rejected this application after hearing the arguments on this application. Aggrieved by this order, the defendants preferred a revision petition, CRP 368/2015 to this Court. The said petition was allowed on 2.9.2015 and the matter was remanded to the trial court for disposing of the application afresh having regard to Section 9 of the Limitation Act and the acquisition of land after the agreement was executed. Therefore, the learned trial judge once again decided the application and allowed the same. Therefore, the plaintiff is before this court. 5. The trial court has recorded the following findings for rejecting the plaint : - (a) that the plaintiff should have got executed a sale deed from Gundappa when he paid the entire sale consideration to him.
Therefore, the learned trial judge once again decided the application and allowed the same. Therefore, the plaintiff is before this court. 5. The trial court has recorded the following findings for rejecting the plaint : - (a) that the plaintiff should have got executed a sale deed from Gundappa when he paid the entire sale consideration to him. There is a doubt as to why an agreement of sale came into existence instead of a sale deed; there was no proper explanation on this aspect. (b) The agreement came into existence on 26.11.1984. The acquisition notification was issued on 15.12.1984 and it was followed by a final notification in the year 1985. If the plaintiff had the knowledge of the acquisition proceedings, he could have obtained the sale deed much before notification for acquisition was issued. There is no explanation for this. (c) In the agreement, time limit is not fixed for completion of the sale transaction. Taking advantage of the absence of the time limit, the plaintiff filed the suit. (d) The plaintiff wanted to enforce unregistered agreement after lapse of three decades and, therefore, there was frustration of contract. (e) The plaintiff has slept over his rights for decades and if at all there was such an agreement, he ought to have issued legal notice within time and sought explanation from his vendor as to why he was delaying completion of the transaction. (f) The plaintiff cannot take advantage of a document which is not admitted by the defendants. 6. Questioning the correctness of the above findings, learned counsel for the appellant argued that the learned trial judge has erroneously allowed the application filed under Order VII Rule 11 CPC although there are no grounds to entertain the said application. The trial judge has entertained doubts instead of examining whether the plaint discloses cause of action or not, or suit is barred by any law. The plaint discloses cause of action for the relief of specific performance based on agreement dated 26.11.1984. Though the suit was instituted in the year 2010 to enforce the said agreement, it cannot be said that the suit is barred by time because the plaintiff has stated reasons which prevented him from taking action within a reasonable time.
The plaint discloses cause of action for the relief of specific performance based on agreement dated 26.11.1984. Though the suit was instituted in the year 2010 to enforce the said agreement, it cannot be said that the suit is barred by time because the plaintiff has stated reasons which prevented him from taking action within a reasonable time. He also argued that in the present case the plaintiff has pleaded certain facts which require recording of evidence and therefore the trial court should not have rejected the plaint. In support of his argument, he relied upon the judgments of the Supreme Court in the case of KULDEEP SINGH PATHANIA vs. BIKRAM SINGH JARYAL [ (2017) 5 SCC 345 ] and CHURCH OF CHRIST CHARITABLE TRUST AND EDUCATIONAL CHARITABLE SOCIETY vs. PONNIAMMAN EDUCATIONAL TRUST [ (2012) 8 SCC 706 ]. He submitted that this appeal deserved to be allowed. 7. The learned counsel for the respondents/defendants argued that the trial court has not committed any error either on facts or on law in rejecting the plaint. His argument was that after execution of the agreement on 26.11.1984, the entire lands in Sy. No. 149 of Agara Village and the surrounding lands were acquired by the BDA. This acquisition resulted in frustration of contract. Subsequent denotification of the land in Sy. No. 149 did not revive the contract unless the parties entered into one more agreement after denotification. He referred to Section 56 of the Contract Act in this regard and placed reliance on the judgment of the Supreme Court in the case of K.NARENDRA vs. RIVIERA APARTMENTS (P) LIMITED [ AIR 1999 SC 2309 ]. 8. The learned counsel argued that once land was notified for acquisition, there was a bar for transferring the notified land by the land owner according to Section 3 of the Karnataka Land (Restriction on Transfer) Act, 1991. Therefore, after notification, the land owner, i.e., the defendant or his father could not have entered into an agreement with the plaintiff’s father. The position of law being so, the plaintiff cannot contend that the agreement subsisted even after notification. 9. The learned counsel further referred to an order passed by this court in CRP 368/2015 and submitted that when the trial court dismissed the respondent’s application under Order VII Rule 11 CPC, they challenged the said order by filing the said revision petition.
9. The learned counsel further referred to an order passed by this court in CRP 368/2015 and submitted that when the trial court dismissed the respondent’s application under Order VII Rule 11 CPC, they challenged the said order by filing the said revision petition. This court while disposing of revision petition held that the trial court should have examined the maintainability of the suit in the light of Section 9 of the Limitation Act in the background of the acquisition of the land by the BDA and therefore allowed the revision petition and remanded the case to the trial court for disposing of the said application once again. The learned counsel for the respondents therefore argued that the trial court has rightly held that the plaintiff has slept over his matter for quite a length of time. He highlighted the point that the agreement came into existence in the year 1984 and the suit was filed in the year 2010. Though the agreement does not specify any time limit within which the contract should be completed, the long time gap will certainly affect the maintainability of the suit. According to him, Section 9 of the Limitation Act is applicable in the sense that the cause of action arose when the agreement was executed and subsequent disability owing to acquisition of land would not stop the time which began to run. Canvassing these points, the learned counsel argued for sustaining the impugned order. 10. I have gone through the impugned order, the plaint, and the agreement based on which the suit has been filed, the application filed under Order VII Rule 11 CPC and also considered the points argued by the counsel for the parties. 11. On perusing the application filed under Order VII Rule 11 CPC it is seen that the defendants/respondents have sought for rejection of the plaint as there is no cause of action for the suit. Order VII Rule 11(a) CPC states that, plaint can be rejected when it does not disclose a cause of action. There is a subtle difference between there being no cause of action for the suit and plaint not disclosing cause of action. So the plaint can be rejected only if it does not disclose cause of action.
Order VII Rule 11(a) CPC states that, plaint can be rejected when it does not disclose a cause of action. There is a subtle difference between there being no cause of action for the suit and plaint not disclosing cause of action. So the plaint can be rejected only if it does not disclose cause of action. It is well established view now that while deciding an application under Order VII Rule 11 CPC, only the averments made in the plaint shall be considered. Defence set up by the defendant shall not be considered at all. In fact, the two decisions cited by the appellant’s counsel in the case of Kuldeep Singh Pathania (supra) and Church of Christ Charitable Trust and Educational Charitable Society (supra) lay down this principle. 12. In the affidavit filed along with the application, the defendants have stated that the plaintiff filed the suit by concocting a sale agreement dated 26.11.1984, that their father had never executed this agreement, that suit property was acquired by BDA for formation of HSR layout, that after denotification of the land from acquisition they sold the said land to number of purchasers who took over the possession and that the plaintiffs were never in possession of the suit property. For these reasons, the defendants stated that the plaintiff did not get cause of action for filing the suit. Thus, it is very clear that the application does not say as to how the plaint does not disclose cause of action given a meaningful reading to it. The main contentions taken by the defendants appear to be that after denotification, the defendants sold the suit property to many purchasers and because they took over the possession, the plaintiff cannot assert to be in possession of the suit land and he does not get the cause of action to institute the suit. The reasons thus given in the affidavit prima facie do not lay a foundation for rejection of plaint. 13. Now, if the plaint is read, it can be seen that the plaintiff has stated about execution of an agreement by the defendants’ father, subsequent acquisition of land by the BDA and its denotification. The plaint also discloses some suits having been filed by the defendants’ father and also the plaintiff against the BDA. The result of these suits are immaterial.
The plaint also discloses some suits having been filed by the defendants’ father and also the plaintiff against the BDA. The result of these suits are immaterial. The main point to be considered is whether acquisition of land by the BDA frustrated the agreement and thereby it did not give rise to cause of action to the plaintiff to institute the suit. No doubt, the acquisition of land by the BDA a few months after the agreement came into existence was beyond the control of the parties to the agreement and it was a supervening circumstance which made the performance of the contract impossible. Subsequently, the Government denotified the land from acquisition and, therefore, the plaintiff has stated in the plaint that after denotification the defendants assured him that he would execute the sale deed. Going by these plaint averments, the meaning that can be gathered is that according to the plaintiff there was an oral agreement in the form of assurance for execution of the sale deed in his favour. There is no doubt force in the argument of the learned counsel for the respondent that Section 56 of the Indian Contract Act is applicable in these set of circumstances and that after denotification, the parties should enter into one more agreement and the earlier agreement does not automatically revive. The judgment of the Supreme Court cited by him in the case of K.Narendra (supra) is also on the same point. Yet it can be said that because the plaintiff has pleaded about assurance given by the defendants after denotification, whether this assurance would amount to revival of contract or not, is a question of fact to be decided by the trial court after recording evidence. Therefore, I am of the opinion that plain reading of the plaint at this stage discloses cause of action. Even though question of frustration of contract emerges for consideration, without giving a finding on the facts, the plaint cannot be rejected straightaway by applying Section 56 of the Contract Act. 14. The learned counsel referred to Section 9 of the Limitation Act and argued that the cause of action arose on the date of agreement and subsequent disability due to acquisition did not stop the running of time. In my considered opinion Section 9 of the Limitation Act cannot be applied here. I have perused the agreement dated 26.11.1984.
14. The learned counsel referred to Section 9 of the Limitation Act and argued that the cause of action arose on the date of agreement and subsequent disability due to acquisition did not stop the running of time. In my considered opinion Section 9 of the Limitation Act cannot be applied here. I have perused the agreement dated 26.11.1984. There is no time stipulation for completion of the contract. According to Article 54 of the Limitation Act, suit has to be filed within three years if there is any date fixed for the performance or, if no date is fixed, within three years the plaintiff has noticed of refusal of performance. The date of execution of the agreement cannot be a starting point of limitation. Subsequent date of denial only gives rise to cause of action. It is no doubt true that, there is a long gap between the date of agreement and the date of institution of the suit. This is a matter to be considered by the trial court with regard to conduct of the plaintiff being ready and willing to perform his part of the contract or not. 15. Even otherwise, if Section 56 of the Contract Act is applicable to the facts of the case, in my opinion it cannot be a ground for rejection of the plaint under Order VII Rule 11 CPC. The defendants have taken up a contention in this regard and, therefore, the trial court has to frame an issue on this plea and decide the same. Order XIV Rule 2(2)(b) CPC can be applied here. In this context I find it useful to refer to a judgment of the Supreme Court in the case of Kuldeep Singh Pathania (supra) where it is held as below:- “9. Thus, for an enquiry under Order 7 Rule 11 (a), only the pleadings of the plaintiff-petitioner can be looked into even if it is at the stage of trial of preliminary issues under Order 14 Rule 2 (2). But the entire pleadings on both sides can be looked into under Order 14 Rule 2 (2) to see whether the court has jurisdiction and whether there is a bar entertaining the suit”. 16. From the above discussion, I come to the conclusion that the trial court has not meaningfully applied its mind for rejecting the plaint.
But the entire pleadings on both sides can be looked into under Order 14 Rule 2 (2) to see whether the court has jurisdiction and whether there is a bar entertaining the suit”. 16. From the above discussion, I come to the conclusion that the trial court has not meaningfully applied its mind for rejecting the plaint. It has just entertained doubts as stated above which cannot be the reason for rejecting the plaint. Consequently, this appeal deserves to be allowed. Accordingly, I pass the following order : - (1) Appeal is allowed with costs. (2) The impugned order dated 27.4.2016 on IA filed under Order VII Rule 11 CPC in O.S. 25570/2010 on the file of LVII Addl. City Civil and Sessions Judge, Bengaluru, is set aside. The case is remanded to the trial court for disposal in accordance with law. (3) The parties are directed to appear before trial court on 1.2.2018 without fail.