Rakesh Malhotra vs Kamaljit Singh Sandhu .

NON-REPORTABLE IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.11070 OF 2018 [Arising out of SLP (C) No. 22667 of 2016]

Rakesh Malhotra .. Appellant

Versus

Kamaljit Singh Sandhu & Ors. .. Respondents

JUDGMENT

M. R. Shah, J.

1. Leave granted.

2. Feeling aggrieved and dissatisfied with the impugned judgment and

order dated 29.2.2016 passed in R.S.A. No. 4015 of 2011 by the High Court of

Punjab and Haryana at Chandigarh, by which the High Court has allowed the

said appeal preferred by the original defendant Nos. 2 and 3 by setting aside

the judgment and order dated 10.8.2011 passed by the Additional District

Judge, Gurgaon and, consequently, has dismissed the suit preferred by the

appellant herein (original plaintiff). The original plaintiff (appellant herein) Signature Not Verified Digitally signed by MUKESH KUMAR has preferred the present appeal.

Date: 2018.11.16 17:52:25 IST Reason:

3. The facts leading to this appeal in nutshell are as follows: 2

That the appellant herein (hereinafter referred to as ‘the original plaintiff’)

instituted Civil Suit No. 159 of 2004 against the respondents herein (original

defendants) seeking a declaration that the plaintiff is the owner and in

possession of the suit property – Plot No. 336 (old) 548 (new), measuring 420

square meters at Block B in the residential colony known as Sushant Lok,

Guugaon. It was also prayed to declare the sale deed dated 28.1.2002

executed in favour of the original defendant nos. 2 and 3 by original defendant

no. 1 as illegal, null and void. In the alternate, it was also prayed for decree of

possession of the suit property by directing the original defendant no. 1 to get

the sale deed executed and registered in favour of the plaintiff in respect of the

suit property, with consequential relief of permanent injunction restraining the

original defendant nos. 2 and 3 from further selling/alienating/transferring the

suit property in question to anyone else, except the plaintiff, in any manner

whatsoever.

3.1 It was the case on behalf of the original plaintiff that the suit property

was booked by the original defendant no. 1 with the developers - M/s Ansal

Properties and Industries Pvt. Ltd. (hereinafter referred to as ‘M/s Ansal

Properties’) However, by an Agreement to Sell dated 20.4.1987 executed by

the original defendant no. 1 being the original allottee from M/s Ansal

Properties in favour of the plaintiff, original defendant no. 1 sold/agreed to sell

the suit property in favour of the plaintiff. It was the case on behalf of the

original plaintiff that at the time of execution of the said written agreement 3

dated 20.4.1987, the plaintiff paid the sale consideration. However, it was

agreed to execute the sale deed as and when the developers M/s Ansal

Properties fulfills its obligation and complete the formalities. It was further

the case on behalf of the original plaintiff that simultaneously one General

Power of Attorney was also executed in favour of the plaintiff by the original

defendant no. 1 empowering the plaintiff to get the transfer in his favour as and

when the plaintiff will deposit all installments of M/s Ansal Properties and

desires to get transferred the suit property in his favour or in favour of his

nominee. It was also the case on behalf of the original plaintiff that the

plaintiff was also put in possession. It was also the case of the original plaintiff

that thereafter the plaintiff paid the stamp duty. It was further the case on

behalf of the original plaintiff that, despite the above fact, when the developers

M/s Ansal Properties allotted the plot in question and executed the title deed in

favour of original defendant no. 1 (being the original allottee), the original

defendant no. 1 did not transfer the plot in question in his name and, in fact,

illegally transferred the suit property in favour of defendant nos. 2 and 3 on a

meagre amount of sale consideration by executing the sale deed dated

28.1.2002. With the above averments and prayers, the plaintiff instituted the

aforesaid suit in the Court of the learned Additional Civil Judge (Senior

Division), Gurgaon.

3.2 The suit was resisted to by the original defendant nos. 2 and 3 by filing

the written statement. It was the case of original defendant nos. 2 & 3 that 4

they are the bona fide purchasers of the suit property for consideration. It was

also the case on behalf of the original defendant nos. 2 and 3 that the suit filed

by the plaintiff seeking a decree of possession and permanent injunction shall

not be maintainable unless there is a prayer for decree for specific

performance. It was the case on behalf of defendant nos. 2 and 3 that unless

the plaintiff renounces the plea of his title, he cannot seek decree of specific

performance. It was further the case on behalf of defendant nos. 2 and 3 that

the suit is collusive between the plaintiff and original defendant no. 1. It was

further case on behalf of the defendant nos. 2 and 3 that the suit is not within

the limitation. That, thereafter, original defendant nos. 2 and 3 also filed the

written statement denying the allegations and averments in the plaint.

3.3 It appears that, thereafter, the original plaintiff submitted an application

to amend the plaint by seeking the prayer of specific performance of the

agreement to sell dated 20.4.1987 submitted under Section 6 Rule 17 CPC.

However, the same came to be dismissed by the learned trial Court and attained

the finality.

3.4 On the basis of the averments in the plaint and the written statement, the

learned trial Court framed the following issues:

“1. Whether the plaintiff is owner in possession of the suit property?

2. Whether the sale deed dated 28.1.2002 executed by defendant no. 1 in favour of defendant no. 2 and 3 is illegal, null and void on the ground alleged in plaint?

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3. Whether the plaintiff is entitled to decree for possession in the alternative with consequential relief of permanent injunction as prayed for?

4. Whether the suit is within limitation?

4A. Whether the defendant no. 2 and 3 are bonafide purchasers as alleged?

5. Whether the plaintiff has no locus-standi to file the present suit?

6. Whether the suit has not been properly valued for the purpose of jurisdiction of court fee?”

3.5 Thereafter, both the parties adduced the evidence, both oral as well as the

documentary. That, thereafter, on appreciation of evidence and considering the

submissions made on behalf of the respective parties, by the judgment and

decree dated 19.10.2010 the learned trial Court partly decreed the suit in favour

of the original plaintiff. The learned trial Court passed the decree for recovery

of Rs.2,46,645.50 with 9% interest throughout its realization. That the learned

trial Court passed the aforesaid decree dated 19.10.2010 in favour of defendant

no. 1 only. The suit and other reliefs came to be dismissed by the learned trial

Court.

4. Feeling aggrieved and dissatisfied with the judgment and decree dated

19.10.2010 passed by the learned trial Court in Civil Suit No. 159 of 2004, the

original plaintiff preferred Civil Appeal No. 109 of 2010 in the Court of

learned District Judge, Gurgaon.

4.1 That the first Appellate Court allowed the said appeal by quashing and

setting aside the judgment and decree passed by the learned trial Court and,

consequently, decreed the suit by holding that the original plaintiff is entitled to 6

decree of declaration to the effect that the sale deed dated 28.1.2002 executed

by the original defendant no. 1 in favour of original defendant nos. 2 and 3 is

illegal, null and void and that the original plaintiff is entitled to decree of

specific performance of agreement to sell to execute the sale deed as per the

agreement to sell dated 20.4.1987.

4.2 Feeling aggrieved and dissatisfied with the judgment and order of the

learned first Appellate Court setting aside the order of the learned trial Court,

original defendant nos. 2 and 3 preferred R.S.A. No. 4015 of 2011 before the

High Court. By the impugned judgment and order dated 29.2.2016, the High

Court has allowed the said appeal and consequently set aside the judgment and

decree of the first Appellate Court and dismissing the suit qua other reliefs and

has restored the judgment and decree passed by the learned trial Court.

4.3 Feeling aggrieved and dissatisfied with the impugned judgment and

order of the High Court, the original plaintiff has preferred the present appeal.

5. Heard Mr. Shyam Divan, learned senior counsel appearing on behalf of

the appellant and Mr. Dhruv Mehta, learned senior counsel appearing on behalf

of the respondents at length.

5.1 Learned counsel appearing on behalf of the appellant herein vehemently

submitted that, in the facts and circumstances of the case, the High Court has

committed a grave error in quashing and setting aside a well reasoned

judgment passed by the first Appellate Court and, that too, in the second

appeal. It is further submitted that, as such, the plaintiff paid the entire 7

consideration at the time of execution of the agreement/agreement to sell dated

20.4.1987 and, even thereafter, the entire stamp duty was paid by the plaintiff

and, therefore, as such, nothing further was pending to be done, except

executing the deed in favour of the original plaintiff by original defendant no.

1. It is submitted that even the plaintiff was also put in possession at the time

of execution of the agreement to sell dated 20.4.1987 and the General Power of

Attorney by original defendant no. 1 in favour of the original plaintiff. It is

submitted that, therefore, the sale was complete in favour of the plaintiff and,

hence, the learned trial Court ought to have decreed the suit in toto and the

learned first Appellate Court, therefore, rightly decreed the suit, which ought

not to have been quashed and set aside by the High Court.

5.2 It is vehemently submitted by the learned counsel appearing on behalf of

the appellant herein that the aforesaid vital/material aspects have not been

considered in true spirit by the High Court and that the High Court has

materially erred in quashing and setting aside a well reasoned judgment and

order passed by the first Appellate Court.

5.3 It is further submitted that the High Court has materially erred in

quashing and setting aside the judgment and order passed by the first Appellate

Court on the ground that there was no prayer for specific performance of the

agreement to sell dated 20.4.1987 and, therefore, the plaintiff was not entitled

to any decree for specific performance which was granted by the learned first

Appellate Court. It is submitted that, as such, there were necessary averments 8

in the plaint and even the reliefs sought in the plaint can be said to be the relief

for specific performance and even the issue no. 3 would cover the relief with

respect to specific performance. It is submitted that, therefore, the High Court

has committed a grave error in quashing and setting aside the order passed by

the first Appellate Court and, consequently, dismissing the suit.

5.4 It is further submitted by the learned counsel for the appellant that the

High Court has not properly appreciated the facts that not only the substantial

amount was paid at the time of execution of the agreement/agreement to sell

dated 20.4.1987, even the subsequent installments were also paid by the

plaintiff and all the notices of demand of installments and other expenses were

directly between the plaintiff and the developer M/s Ansal Properties and that

the plaintiff paid the entire installments up to 20.4.1990.

5.5 It is further submitted that the High Court has not properly appreciated

the fact that after the title deed/sale deed was executed by the developers M/s

Ansal Properties in favour of defendant no. 1 by the sale deed dated 31.3.1994,

the original defendant no. 1 assured the plaintiff that he will get the sale deed

executed in his favour. However, subsequently, the original defendant no. 1

did not execute the sale deed in favour of the original plaintiff and, on the

contrary, superciliously sold the suit property in favour of the original

defendant nos. 2 and 3 and, therefore, the plaintiff was constrained to file the

suit. It is submitted that, therefore, the sale deed executed by original

defendant no. 1 in favour of defendant nos. 2 and 3 was illegal, null and void 9

and, therefore, the same was rightly declared to be illegal, null and void ab

initio by the first Appellate Court.

5.6 By making the above submissions, it is requested to allow the present

appeal and quash the impugned judgment and order passed by the High Court

and consequently restoring the judgment and order passed by the first

Appellate Court and to decree the suit.

6. The present appeal has been vehemently opposed by the learned counsel

appearing for the original defendant nos. 2 and 3. It is vehemently submitted

on behalf of the original defendant nos. 2 and 3 that the High Court has rightly

allowed the appeal preferred by the original defendant nos. 2 and 3 and rightly

quashed and set aside the judgment and order passed by the learned first

Appellate Court granting relief for specific performance of agreement to sell

dated 20.4.1987. It is submitted that in absence of any specific prayer in the

plaint/suit asking the decree of specific performance of Agreement to Sell, as

rightly observed by the High Court, the first Appellate Court was not justified

in granting the relief of specific performance of agreement to sell dated

20.4.1987.

6.1 It is further submitted on behalf of the defendant nos. 2 and 3 that, even

otherwise, the suit was barred by limitation. It is submitted that the original

plaintiff claimed the reliefs on the basis of the agreement to sell dated

20.4.1987, however, the suit was instituted in the year 2004. It is further

submitted that even the title deed/sale deed in favour of defendant no. 1 by the 10

developers M/s Ansal Properties was executed in the year 1994 and that the

original plaintiff was in knowledge of the same since the year 1994, still he

instituted the suit in the year 2004 only, i.e. after a period of 10 years. It is

submitted that, in the meantime, the original plaintiff did nothing to get the sale

deed executed in his favour and/or in favour of his nominee. It is submitted

that thereafter even the sale deed in favour of original defendant nos. 2 and 3

was executed by the original defendant no. 1 in the year 2002, which was a

registered sale deed with value and on payment of full sale consideration and

the original plaintiff instituted the suit in the year 2004 only. It is submitted

that, therefore, on consideration of evidence and in the circumstances of the

case, the High Court has rightly interfered with the judgment and order passed

by the first Appellate Court and, consequently, has rightly dismissed the suit.

6.2 Learned counsel appearing on behalf of defendant nos. 2 and 3 has

submitted that, in the facts and circumstances of the case, and to buy the peace

and to put an end to the entire litigation, they are even ready and willing to pay

Rs.10,00,000/- to the original plaintiff as ex-gratia, which may be over and

above the decreetal to be paid by the original defendant no. 1 pursuant to the

judgment and decree passed by the learned trial Court.

7. Heard the learned counsel for both the parties at length and perused the

judgment and decree passed by the learned trial Court and the judgment and

orders passed by the Courts below.

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7.1 At the outset, it is required to be noted that in the suit the original

plaintiff sought the relief of declaration and permanent injunction only and

there was no specific prayer of specific performance of the agreement to sell

dated 20.4.1987. It is also required to be noted that even the original plaintiff

submitted the application under Order 6 Rule 17 CPC to amend the plaint by

seeking relief of specific performance of the agreement to sell dated

20.4.1987. However, the same came to be dismissed and the same has attained

the finality. Even there was no specific issue framed by the learned trial Court

for specific performance with respect to the agreement to sell dated 20.4.1987.

Nothing is on record that, at any point of time, the original plaintiff made any

grievance with respect to the non-framing of the issue with respect to specific

performance of the agreement to sell dated 20.4.1987. Even no effort was

made before the learned trial Court to re-frame the issue. Therefore, as such,

there was no specific prayer for specific performance of the agreement to sell

dated 20.4.1987. Despite the above, the first Appellate Court granted relief of

specific performance of he agreement to sell dated 20.4.1987 for which there

was no prayer in the plaint. Therefore, the High Court was justified in

reversing the judgment and order passed by the first Appellate Court granting

relief for specific performance of the agreement to sell dated 20.4.1987.

7.2 Even the High Court is justified in not granting the other reliefs prayed

in the suit, namely, the declaration that the original plaintiff is the owner and in

possession of the suit property and even the suit for permanent injunction. It 12

is also required to be noted that the original plaintiff claimed reliefs on the

basis of the agreement to sell dated 20.4.1987 and the general power of

attorney executed in the year 1987. The agreement dated 20.4.1987 is rightly

considered to be the agreement to sell only. The case on behalf of the original

plaintiff that the agreement to sell dated 20.4.1987 was a complete sale and it

was a sale deed cannot be accepted for the simple reason that the said

agreement/agreement to sell dated 20.4.1987 was not a registered one and even

the same was not on the proper stamp duty and, therefore, as such, the same is

not admitted in evidence and the same can be used only for the collateral

purpose. Therefore, the agreement to sell dated 20.4.1987 is rightly

considered to be the agreement to sell only. Even considering the submissions

made by the learned counsel appearing on behalf of the plaintiff and even

considering the averments made in the agreement to sell dated 20.4.1987, the

same can be said to be an agreement to sell only, as even the title deed/sale

deed in favour of the original defendant no. 1 was executed in the year 1994.

Therefore, both the learned trial Court and the High Court are justified in

refusing to grant of declaration as sought in the plaint.

7.3 Even otherwise, the plaintiff is not entitled to the reliefs sought in the

plaint even on the ground of limitation also. It is required to be noted that the

agreement/agreement to sell and the general power of attorney were executed

in the year 1987, on the basis of which the plaintiff had sought for the reliefs in

the year 2004. Even, according to the plaintiff also, the title deed/sale deed in 13

favour of the original defendant no.1 executed by the developers M/s Ansal

Properties was in the year 1994. Considering the evidence on record and even

considering the case on behalf of the plaintiff, it appears that throughout the

plaintiff was aware of the execution of the title deed/sale deed in favour of the

original defendant no. 1 executed in the year 1994, still the suit has been

instituted in the year 2004 only, i.e. after a period of 10 years. Nothing is on

record that any steps were taken by the original plaintiff to get the sale deed

executed in his favour and/or in favour of his nominee. Therefore, the suit has

been instituted after a period of 17 years after the execution of the

agreement/agreement to sell dated 20.4.1987 and after a period of 10 years

from the date of the title deed/sale deed in favour of the original defendant no.

1. Considering the aforementioned facts and circumstances of the case, the

plaintiff is not entitled such reliefs, except of decree of recovery of amount

paid to the original defendant no. 1.

7.4 In the aforesaid facts and circumstances of the case, we are in complete

agreement with the view taken by the learned trial Court as well as that of the

High Court, in not granting the other reliefs and granting the decree of

recovery of the amount paid by the original plaintiff to the original defendant

no. 1 only. In view of the reasons stated above, we see no reason to interfere

with the judgment and order passed by the High Court and, consequently, the

present appeal deserves to be dismissed and is accordingly dismissed. 14

8. However, as agreed, the original defendant nos. 2 and 3 are directed to

pay a sum of Rs.10,00,000/- to the original plaintiff ex-gratia, which they have

agreed to pay to put an end to the litigation and to buy a peace, to be paid to the

original plaintiff within a period of six weeks from today. On payment of the

aforesaid amount of Rs.10,00,000/- to the original plaintiff by original

defendant nos. 2 and 3, any proceedings pending between the parties, if any,

shall stand terminated.

9. With the above observations and directions, the present appeal stands

dismissed, however, with no costs. I.A., if any, stands disposed of.

………………………………..J. (UDAY UMESH LALIT)

………………………………..J. (M. R. SHAH) New Delhi, November 16, 2018