Nand Lal v. M/S Deluxe Integrated Cold Chain Pvt. Ltd. and Others

Himachal Pradesh HC3 Oct 2024CS/6/2024

Case brief

AI extract

What is this about?

Order VII Rule 11 CPC; rejection of plaint; suit barred by limitation; Article 58 Limitation Act; Article 65 Limitation Act; Article 59 Limitation Act; sale deed without consideration not void; declaration before suit for possession; Section 118 HP Tenancy and Land Reforms Act; Section 54 and Section 55(4)(b) Transfer of Property Act 1882; use and occupation charges limitation; ta khubzul badlain; Nand Lal; Deluxe Integrated Cold Chain; Civil Suit No. 6 of 2024; OMP No. 179 of 2024; Rakesh Kainthla; 03.10.2024; Himachal Pradesh; Kullu; Manali.

What did the court decide?

Application OMP No. 179 of 2024 under Order VII Rule 11 CPC allowed; plaint in Civil Suit No. 6 of 2024 ordered to be rejected; no further proceedings required in the suit. ¶117

Nand Lal Vs M/S Deluxe Integrated Cold Chain Pvt. Ltd. and Others — Himachal Pradesh HC (2024) — LawSathi Research

What the court decided

AI extract

Outcome

Application OMP No. 179 of 2024 under Order VII Rule 11 CPC allowed; plaint in Civil Suit No. 6 of 2024 ordered to be rejected; no further proceedings required in the suit.

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Issue for consideration

Whether the plaint is liable to be rejected under Order VII Rule 11 CPC on the ground that the suit is barred by limitation, as apparent from a bare reading of the plaint. +3 more

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Court's answer

A plaint can be rejected under Order VII Rule 11 CPC on the ground of limitation only where the bar is made out from the bare reading of the plaint.

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Ratio / Principle

A sale deed that recites payment of consideration is valid and effective even if consideration was not actually paid; the vendor is left at most with a charge under Section 55(4)(b) Transfer of Property Act, 1882; hence the sale deed in the present case cannot be treated as void or of no consequence.

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Key takeaways

The sale deed conveyed title (and, as shown by the use-and-occupation claim, possession) to defendant No.1; it remains valid until set aside, and the plaintiff cannot obtain any relief without first setting it aside.ratio¶77
The claim for use and occupation charges w.e.f. 13.02.2016 till filing of the suit is barred by limitation, as such charges could have been claimed only for three years before filing, and the suit was filed on 11.01.2024.ratio¶112
The cause of action for recovery of the sale consideration of Rs. 1,15,50,000/- accrued on 03.02.2016, the date of execution of the sale deed; the suit filed on 11.01.2024, after eight years, is barred by limitation for recovery of money.

Detailed headnote1 paragraphs

Order on application (OMP No. 179 of 2024) under Order VII Rule 11 CPC by defendants No. 1 to 3 in Civil Suit No. 6 of 2024 (Nand Lal v. M/s Deluxe Integrated Cold Chain Pvt. Ltd. and others) — application allowed, plaint rejected. The plaint sought physical possession of suit land, use-and-occupation charges from 13.02.2016 (Rs. 30,00,000/- @ 18% p.a.), permanent prohibitory injunction against defendants 1–3, and alternatively recovery of sale consideration of Rs. 1,15,50,000/- @ 18% p.a.; a sale deed was registered in favour of defendant No.1 on 03.02.2016 after permission under Section 118, HP Tenancy and Land Reforms Act. Held: (i) a registered sale deed reciting consideration transfers title even if consideration was unpaid — the vendor retains only a charge under Section 55(4)(b), Transfer of Property Act, 1882 — so the deed is not void and must be set aside before any relief; (ii) the plaintiff never sought declaration/invalidation of the deed, has lost title, and cannot maintain a possession/injunction suit against the true owner; (iii) the use-and-occupation claim (beyond three years before filing on 11.01.2024) and the money-recovery claim (cause of action accruing 03.02.2016) are barred by limitation. Relied on Eldeco Housing, Dahiben, Hardesh Ores, Nusli Neville Wadia, Yogendra Prasad Singh and Raghwendra Sharan Singh; followed Ramisetty Venkatanna; held the plaintiff-side citations (Shivshankar Gurgar; Rajasthan SIDC; Pratibha Singh; Jharkhand State Housing Board) inapplicable.

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Nand Lal vs. M/s Deluxe Integrated Cold Chain Pvt. Ltd and others

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Civil Suit No. 6 of 2024 Reserved on 20.08.2024.

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03.10.2024 Present:

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Mr. G.D. Verma, Senior Advocate, with Mr. Sumit Sharma, Advocate, for the nonapplicant/plaintiff.

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Mr Neeraj Gupta, Senior Advocate, with Mr Ajeet Kumar Jaiswal, Advocate for applicants/defendants No.1 to 3.

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Mr. Ajit Sharma, Deputy Advocate General, for defendant No.4/State.

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OMP No. 179 of 2024

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This order shall dispose of an application

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under Order VII Rule 11 of CPC filed on behalf of applicants/defendants no.1 to 3 for rejection of the plaint.

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Briefly stated, the facts giving rise to the present application are that the nonapplicant/plaintiff has filed a civil suit seeking the physical possession of the suit land described in the plaint, recovery of the use and occupation charges with effect from 13.02.2016 till filing of the suit and a decree of permanent prohibitory injunction for restraining the applicants/defendants No. 1 to 3 from changing the nature of the suit land and in the

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alternative for the recovery of total sale consideration of ₹1,15,50,000/- along with interest @ 18 % per annum from 03.02.2016 till the recovery. It was pleaded that the non-applicant/plaintiff is an agriculturist having a rural background. He is not sufÏciently educated and is unable to understand and match with the business tricks and deceptive behaviour of applicants/defendants No. 1 to 3. The non-applicant/plaintiff and applicants/defendants No. 1 to 3 had business dealings and acquaintances. The non-applicant/plaintiff is the recorded owner in possession of the suit land. The applicants/defendants No.1 to 3 succeeded in persuading the nonapplicant/plaintiff to enter into an agreement to sell his land to the extent of 1410/2431 share for a sum of ₹1,24,05,000/-by giving him various allurements and incentives including making him an active Director in the business. The applicants/defendants No. 1 to 3 entered into an agreement with the nonapplicant/plaintiff because they were nonagriculturists and could not have entered into an agreement to purchase the agricultural land. It was

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stated in the agreement to sell dated 08.11.2012 that defendant no.1 had agreed to purchase the land having a frontage of 55 meters from the corner of National Highway for a sum of ₹ 1,29,05,000/- to the extent of 1410/2431 share. The agreed consideration was to be paid by defendant No.1 at the time of the registration of the sale deed. No consideration was paid at the time of the execution of the agreement dated 08.11.2012. Permission was required to execute the sale deed from the State Government under Section 118 of the HP Tenancy and Land Reforms Act. The applicants/defendants No.1 to 3 again prepared an agreement to purchase the land on 24.05.2014 for a consideration of ₹ 1,15,50,000/- which was to be paid at the time of execution and registration of the sale deed before the Sub Registrar. The nonapplicant/plaintiff was shown as one of the Directors of the defendant No.1-Company in this agreement. Deputy Commissioner Kullu recommended the case of defendant No.1 for the purchase of the land as per his letter dated 18.08.2015. Additional Chief Secretary (Revenue) to the Govt. of H.P. conveyed the necessary

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permission for the purchase of the land by defendant No.1 vide letter dated 07.12.2015. A sale deed was executed in favour of defendant no.1 which was registered in the ofÏce of Sub Registrar, Manali on 03.02.2016. No sale consideration was paid by the defendant to the non-applicant/plaintiff in respect of the land stated to have been sold. The nonapplicant/plaintiff was under the control and influence of the applicants/defendants No.1 to 3 and he was made to put signatures on different documents without explaining their contents. The sale deed could not have been executed without the payment of sale consideration. No title of the portion of land stated to have been sold passed to the applicants/defendants No.1 to 3. The non-applicant/plaintiff was also not made a Director/partner of defendant No.1. Defendants got the entries of ownership regarding the suit land entered in their favour. The defendants deceived the non-applicant/plaintiff by making misrepresentations of the facts and acting illegally. The non-applicant/plaintiff was not bound by the sale

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deed; hence the suit was filed to seek the relief mentioned above.

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The applicants/defendants filed an application under Order VII Rule 11 of CPC for rejection of the plaint. It was asserted that as per the plaint, the non-applicant/plaintiff claimed to be the owner in possession of the suit land and not being bound by the sale deed dated 03.02.2016. A plain reading of the plaint and the relief claimed by the nonapplicant/plaintiff shows that the suit of the nonapplicant/plaintiff is barred by limitation and the plaint is liable to be rejected under Order VII Rule 11 of CPC. The sale deed dated 03.02.2016 in favour of the applicants/defendants No.1 to 3 created a cloud over the title of the non-applicant/plaintiff and the nonapplicant/plaintiff cannot claim the possession or the other relief without seeking a declaration. The nonapplicant/plaintiff claims the knowledge of the execution of the sale deed dated 03.02.2016 and he should have filed the suit within three years of the execution of the sale deed. The suit is governed by Article 58 of the Limitation Act. The plaintiff has not

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sought the relief of declaration and has sought the relief of possession but his suit will not fall within the purview of Article 65 but Article 58 of the Limitation Act because he cannot be granted any relief without seeking a declaration. Hence, it was prayed that the present application be allowed and the plaint be rejected under Order VII Rule 11 of CPC. 4. The application is opposed by filing a reply taking preliminary objections regarding lack of maintainability, the defendants being estopped from filing the application on account of their act, conduct, deeds, admission and omission and the application not being bona fide . The contents of the application were denied on merits. It was asserted that no sale consideration was paid to the plaintiff and the sale transaction is illegal and void. No title has been transferred in favour of the defendants and there is no limitation regarding void documents. There is no necessity to set aside the sale deed and the suit for possession is within limitation. The nonapplicant/plaintiff is entitled to the benefit of the period of COVID-19 commencing from 15.03.2020 till

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28.02.2022. Hence, it was prayed that the present application be dismissed.

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I have heard Mr. G.D. Verma, learned Senior Advocate assisted by Mr. Sumit Sharma, learned counsel for the non-applicant/plaintiff and Mr. Neeraj Gupta, learned Senior Advocate assisted by Mr. Ajit Kumar Jaswal learned counsel for applicants/ defendants No.1 to 3.

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Mr. Neeraj Gupta, learned Senior Counsel for applicants/defendants No.1 to 3 submitted that the averments in the plaint show that the plaintiff is aggrieved with the sale deed dated 03.02.2016. It is necessary for him to set aside the sale deed before he can get any relief. He was required to file a suit for declaration which can be filed within three years and a suit filed after three years is barred by limitation. He relied upon the judgments of Anathula Sudhakar Vs. P. Buchi Reddy (2008) 4 SCC 594 , Dahiben versus Arvindbhai Kalyanji Bhansuli (2020) 7 SCC 366 , T. Arviandandam versus T.V. Satyapal and another (1977) 4 SC 467 and Amar Chand versus Madan Lal (2019) Latest HLJ 1014 in support of his submission.

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Mr G.D. Verma, Senior Advocate for the non-applicant/plaintiff submitted that the application is misconceived. The plaintiff has not sought any declaration. He has filed a suit for possession which is governed by Article 65. The defendants have not taken any plea of adverse possession and the suit is not governed by limitation. The sale deed without consideration is void and no declaration is required to be obtained for the same. Therefore, he prayed that the present application be dismissed. He relied upon Shivshankar Gurgar v. Dilip, (2014) 2 SCC 465, Rajasthan State Industrial Development & Investment Corpn. v. Subhash Sindhi Coop. Housing Society, (2013) 5 SCC 427, 2019 (5) SCC 145 (sic) , Pratibha Singh v. Shanti Devi Prasad, (2003) 2 SCC 330 and Jharkhand State Housing Board v. Didar Singh, (2019) 17 SCC 692 in support of his submission.

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I have given considerable thought to the submissions made at the bar and have gone through the records carefully.

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The principles for exercising jurisdiction under Order VII Rule 11 were laid down by the Hon’ble

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Supreme Court in Eldeco Housing & Industries Ltd. v. Ashok Vidyarthi, 2023 SCC OnLine SC 1612 wherein it was observed:

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17. In Kamala v. K. T. Eshwara Sa 2008 (12) SCC 661 , this Court opined that for invoking clause (d) of Order VII Rule 11 CPC, only the averments in the plaint would be relevant. For this purpose, there cannot be any addition or subtraction. No amount of evidence can be looked into. The issue of the merits of the matter would not be within the realm of the Court at that stage. The Court at that stage would not consider any evidence or enter a disputed question of fact of law. Relevant paragraphs thereof are extracted below:

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“21. Order 7 Rule 11( d ) of the Code has limited application. It must be shown that the suit is barred under any law. Such a conclusion must be drawn from the averments made in the plaint. Different clauses in Order 7 Rule 11, in our opinion, should not be mixed up. Whereas in a given case, an application for rejection of the plaint may be filed on more than one ground specified in various sub-clauses thereof, a clear finding to that effect must be arrived at. What would be relevant for invoking clause (d) of Order 7 Rule 11 of the Code are the averments made in the plaint. For that purpose, there cannot be any addition or subtraction. The absence of jurisdiction on the part of a court can be invoked at different stages and under different provisions of the Code. Order 7 Rule 11 of the Code is one, Order 14 Rule 2 is another. 22. For the purpose of invoking Order 7 Rule 11(d) of the Code, no amount of evidence can be looked into. The issues on merit of the matter which may arise between the parties

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would not be within the realm of the court at that stage. All issues shall not be the subject matter of an order under the said provision. 23. The principles of res judicata, when attracted, would bar another suit in view of Section 12 of the Code. The question involving a mixed question of law and fact which may require not only examination of the plaint but also other evidence and the order passed in the earlier suit may be taken up either as a preliminary issue or at the final hearing, but, the said question cannot be determined at that stage.

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It is one thing to say that the averments made in the plaint on their face disclose no cause of action, but it is another thing to say that although the same discloses a cause of action, the same is barred by law. 25. The decisions rendered by this Court as well as by various High Courts are not uniform on this behalf. But, then the broad principle which can be culled out therefrom is that the court at that stage would not consider any evidence or enter into a disputed question of fact or law . In the event, the jurisdiction of the court is found to be barred by any law, meaning thereby, the subject-matter thereof, the application for rejection of plaint should be entertained.” (emphasis supplied)

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18. Similar was the view expressed in Shakti Bhog Food Industries Ltd. v. Central Bank of India (2020) 17 SCC 260: 2020: INSC:413 and Srihari Hanumandas Totala v. Hemant Vithal Kama (2021) 9 SCC 99: 2011: INSC:387 . 19. The law applicable for deciding an application under Order VII Rule 11 CPC was summed up by this Court in Dahiben v. Arvindbhai Kalyanji Bhanusali (Gajra) dead through legal representatives (2020) 7 SCC 366: 2020: INSC:450. Relevant parts of paragraph 23 thereof are extracted below:

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“23 to 23.1 x x x

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23.2. The remedy under Order 7 Rule 11 is an independent and special remedy, wherein the court is empowered to summarily dismiss a suit at the threshold, without proceeding to record evidence and conducting a trial, on the basis of the evidence adduced, if it is satisfied that the action should be terminated on any of the grounds contained in this provision. 23.3. The underlying object of Order 7 Rule 11( a ) is that if in a suit, no cause of action is disclosed, or the suit is barred by limitation under Rule 11( d ), the court would not permit the plaintiff to unnecessarily protract the proceedings in the suit. In such a case, it would be necessary to put an end to the sham litigation, so that further judicial time is not wasted.

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23.4. In Azhar Hussain v. Rajiv Gandhi, 1986 Supp SCC 315 , this Court held that the whole purpose of conferment of powers under this provision is to ensure that a litigation which is meaningless, and bound to prove abortive, should not be permitted to waste judicial time of the court, in the following words:

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“ 12. … The whole purpose of conferment of such powers is to ensure that a litigation which is meaningless, and bound to prove abortive should not be permitted to occupy the time of the court and exercise the mind of the respondent. The sword of Damocles need not be kept hanging over his head unnecessarily without point or purpose. Even in an ordinary civil litigation, the court readily exercises the power to reject a plaint, if it does not disclose any cause of action.”

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23.5. The power conferred on the court to terminate a civil action is, however, a drastic one and the conditions enumerated

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in Order 7 Rule 11 are required to be strictly adhered to.

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23.6. Under Order 7 Rule 11, a duty is cast on the court to determine whether the plaint discloses a cause of action by scrutinising the averments in the plaint [ Liverpool & London S.P. & I Assn. Ltd. v. M.V. Sea Success I, (2004) 9 SCC 512] , read in conjunction with the documents relied upon, or whether the suit is barred by any law.

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23.9. In the exercise of power under this provision, the court would determine if the assertions made in the plaint are contrary to statutory law, or judicial dicta, for deciding whether a case for rejecting the plaint at the threshold is made out.

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23.10. At this stage, the pleas taken by the defendant in the written statement and application for rejection of the plaint on the merits, would be irrelevant, and cannot be adverted to, or taken into consideration. [ Sopan Sukhdeo Sable v. Charity Commr., (2004) 3 SCC 137 ]

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23.11. The test for exercising the power under Order 7 Rule 11 is that if the averments made in the plaint are taken in entirety, in conjunction with the documents relied upon, would the same result in a decree being passed? This test was laid down in Liverpool & London S.P. & I Assn. Ltd. v. M.V. Sea Success I [Liverpool & London S.P. & I Assn. Ltd. v. M.V. Sea Success I, (2004) 9 SCC 512 ] which reads as: (SCC p. 562, para 139)

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“ 139. Whether a plaint discloses a cause of action or not is essentially a question of fact. But whether it does or does not must be found out from reading the plaint itself. For the said purpose, the averments made in the plaint in their entirety must be held to be correct. The test is as to whether if the averments

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made in the plaint are taken to be correct in their entirety, a decree would be passed.”

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23.12. In Hardesh Ores (P) Ltd. v. Hede & Co. [Hardesh Ores (P) Ltd. v. Hede & Co., (2007) 5 SCC 614] the Court further held that it is not permissible to 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 ].

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23.13. 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 7 Rule 11 CPC.

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23.14. The power under Order 7 Rule 11 CPC may be exercised by the court at any stage of the suit, either before registering the plaint, after issuing summons to the defendant, or before the 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 Court in Azhar Hussain v. Rajiv Gandhi, 1986 Supp SCC 315 . Followed in Manvendrasinhji Ranjitsinhji Jadeja v. Vijaykunverba, 1998 SCC OnLine Guj 281: (1998) 2 GLH 823 . 23.15. The provision of Order 7 Rule 11 is mandatory in nature. It states that the

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plaint “shall” be rejected if any of the grounds specified in clauses ( a ) to ( e ) are made out. If the court finds that the plaint does not disclose a cause of action, or that the suit is barred by any law, the court has no option, but to reject the plaint.”

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20. The same view was reiterated in Kum. Geetha v. Nanjundaswamy2023 SCC OnLine SC 1407: 2023 INSC 964 .” 10. It was laid down by the Hon’ble Supreme

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Court in Hardesh Ores (P) Ltd. v. Hede and Co., (2007) 5 SCC 614: 2007 SCC OnLine SC 703 that the plaint can be rejected under Order 7 Rule 11 of CPC if it appears to be barred by limitation from the plain reading of the

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plaint. It was observed:

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25. The language of Order 7 Rule 11 CPC is quite clear and unambiguous. The plaint can be rejected on the ground of limitation only where the suit appears from the statement in the plaint to be barred by any law. Mr Nariman did not dispute that “law” within the meaning of clause ( d ) of Order 7 Rule 11 must include the law of limitation as well. It is well settled that whether a plaint discloses a cause of action is essentially a question of fact, but whether it does or does not must be found out from reading the plaint itself. For the said purpose the averments made in the plaint in their entirety must be held to be correct. The test is whether the averments made in the plaint if taken to be correct in their entirety, a decree would be passed. The averments made in the plaint as a whole have to be seen to find out whether clause ( d ) of Rule 11 of Order 7 is applicable. It is not permissible to cull out a sentence or a passage and to read it out of the context in isolation. Although it is the substance and not merely

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the form that has to be looked into, the pleading has to be construed as it stands without addition or subtraction of words or change of its apparent grammatical sense. As observed earlier, the language of clause ( d ) is quite clear but if any authority is required, one may usefully refer to the judgments of this Court in Liverpool & London S.P. & I Assn. Ltd. v. M.V. Sea Success I [(2004) 9 SCC 512] and Popat and Kotecha Property v. State Bank of India Staff Assn. [(2005) 7 SCC 510] 11. A similar view was taken in Nusli Neville

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Wadia v. Ivory Properties, (2020) 6 SCC 557: (2020) 3 SCC (Civ) 671: 2019 SCC OnLine SC 1313 wherein it was

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observed:

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67. In Vaish Aggarwal Panchayat v. Inder Kumar [Vaish Aggarwal Panchayat v. Inder Kumar, (2020) 12 SCC 809: 2015 SCC OnLine SC 751: AIR 2015 SC 3357] , the question came up for consideration of rejection of the plaint under Order 7 Rule 11 on the ground that same being barred by limitation. On mere ex-facie reading of the plaint, it could not be held that the suit was barred by time. The question of limitation becomes a mixed question of facts and law and cannot be decided as a preliminary issue as the framing of issues and taking evidence was necessary.

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68. In our opinion, it cannot be laid down as a proposition of law under Order 7 Rule 11( d ) that the plaint cannot be rejected as barred by limitation. It can be said that it is permissible to do so mainly in a case where the plaint averment itself indicates the cause of action to be barred by limitation and no further evidence is required to adjudicate the issue. 69. In Hareendran v. Sukumaran [Hareendran v. Sukumaran, (2018) 14 SCC 187: (2018) 4 SCC (Civ) 510] , this Court has laid down that question of limitation in the case being a

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mixed question of law and facts, could not have been decided as a preliminary issue. The provision under which a plaint can be rejected is provided in Order 7 Rule 11( d ). The language used in Order 7 Rule 11 is where averments made in the plaint do not disclose a cause of action; relief claimed is undervalued, and the plaint is not corrected despite the direction of the Court; plaint is insufÏciently stamped, and despite the Court's order the plaintiff has failed to supply the requisite stamp duty; where the suit appears from the statement in the plaint to be barred by any law; where it is not filed in duplicate; and where the plaintiff fails to comply with the provisions of Rule 9. What is of significance under Order 7 Rule 11 is that from the averments of the plaint itself, the suit is barred by any law and it would include limitation also including bar created by any other law for the time being in force . For the rejection of the plaint, averments made by the defendant in the written statement or otherwise cannot be seen, only the averments of the plaint are material and can be taken into consideration and no other evidence.”

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Therefore, it is apparent that if the suit is

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barred by limitation, the plaint can be rejected but before doing so, it should be made out from the bare reading of the plaint that the suit filed by the plaintiff is barred by limitation.

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It was submitted that a sale deed executed without sale consideration is void and there is no necessity to set it aside. This submission cannot be accepted. It was laid down by the Hon’ble Supreme

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Court in Yogendra Prasad Singh v. Ram Bachan Devi, 2023 SCC OnLine SC 894 that where the Sale deed mentions the payment of consideration, the same is valid even if no sale consideration is paid. It was observed:

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“12. A sale deed of an immovable property is executed in accordance with Section 54 of the Transfer of Property Act, 1882 (for short, ‘the 1882 Act’). There cannot be any dispute that normally, on the execution of a registered Sale Deed by the owner of the property, the title in the property subject matter of the Sale Deed stands transferred to the purchaser. Considering the principles laid down in subsection (4)(b) of Section 55 of the 1882 Act, the seller will have a charge over the property subject matter of the sale for unpaid consideration and he can enforce the charge by filing a suit.

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13. The entire case of the defendants is based on the decision of this Court in the case of Janak Dulari Devi 2011 (6) SCC 555 . In paragraph 20 of the said decision this Court held thus:

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“ 20. We have referred to several decisions of the Patna High Court in detail to demonstrate the existence of the established practice of exchanging equivalents (ta khubzul badlain) . The effect of such transactions in Bihar is that even though the duly executed and registered sale deed may recite that the sale consideration has been paid, title has been transferred and possession has been delivered to the purchaser, the actual transfer of title and delivery of possession is postponed from the time of execution of the

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sale deed to the time of exchange of the registration receipt for the consideration, that is, ta khubzul badlain .” (emphasis added)

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14. Paragraph 24 of the decision reads thus:

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“ 24. We hasten to add that the practice of ta khubzul badlain (of title passing on exchange of equivalents) is prevalent only in Bihar. Normally, the recitals in a sale deed about transfer of title, receipt of consideration and delivery of possession will be evidence of such acts and events; and on the execution and registration of the sale deed, the sale would be complete even if the sale price was not paid, and it will not be possible to cancel the sale deed unilaterally. The exception to this rule is stated in Kaliaperumal [(2009) 4 SCC 193 : (2009) 2 SCC (Civ) 101 ]. The practice of ta khubzul badlain in Bihar recognises that a duly executed sale deed will not operate as a transfer in praesenti but postpones the actual transfer of title, from the time of execution and registration of the deed, to the time of exchange of equivalents, that is, registration receipt and the sale consideration, if the intention of the parties was that title would pass only on payment of entire sale consideration . As a result, until and unless the duly executed and registered sale deed comes into the possession of the purchaser, or until the right to receive the original sale deed is secured by the purchaser by obtaining the registration receipt, the deed of sale remains merely an agreement to be performed and will not be a completed sale. But in States where such a practice is not prevalent, possession of registration receipt by the vendor, may not, in the absence of other clear evidence, lead to an inference that consideration has not been paid or that title has not passed to the purchaser as recited in the duly executed deed of

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conveyance. Where the purchaser is from an outstation, the vendor being entrusted with the registration receipt, to collect the original sale deed and deliver it to the purchaser, is common. Be that as it may.” (emphasis added)

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15. Thus, this Court held that normally, on the execution and registration of a sale deed containing recitals regarding the payment of consideration and delivery of possession, the sale is complete even if the sale price is not paid and, therefore, it will not be possible to cancel the sale deed in its entirety. However, the exception to the said rule is the practice of ta khubzul badlain . The use of the expression ta khubzul badlain in a sale deed by itself will not be determinative of the true nature of the transaction. It cannot be read in isolation. All the terms and conditions and recitals in the document will have to be considered to decide the real nature of the transaction.

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16. We have, therefore, examined the recitals in the Sale Deed from the translated English version of the same produced by the appellants. The English translation shows that-

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(a) There is a specific recital that the first defendant has transferred the possession of the suit property to the plaintiff in the capacity of the owner and that the plaintiff will become the owner of the property;

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(b) It also mentions that from the date of Sale Deed, the first defendant has no claim or title in respect of the suit property or regarding its price;

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defendant had received consideration; and

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(d) The plaintiff who was the son-in-law of the first defendant took the suit property with encumbrances when the first defendant was in trouble due to liabilities.

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17. Therefore, the use of the words “khubzul badlain”, in the facts of the case, cannot be conclusive. It is true that the Sale Deed refers to various mortgages executed by the first defendant for getting money and the recitals indicate that the plaintiff had agreed to discharge the said loan liabilities. But, there is a specific recital in the Sale Deed that the title and possession in the property has been passed to the plaintiff. These recitals regarding the transfer of title and possession are very crucial which cannot be brushed aside.

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18. On overall reading of the Sale Deed, it is apparent that under the Sale Deed, the entire right, title and interest of the first defendant in the suit property has been transferred to the plaintiff by the said sale deed. At the highest, as per sub-section (4)(b) of Section 55 of the 1882 Act, the first defendant was entitled to have a charge on the suit property for the amount of consideration which was not paid by the plaintiff. Even this provision may not help the first defendant. The reason is that the plaintiff has taken over the suit property with liabilities as set out in the Sale Deed. The creditors of the first defendant can, therefore, proceed against the suit property. Once we hold that the title and ownership passed on to the plaintiff on the date of the Sale Deed, it is not necessary to go into the question whether the appellant has discharged liabilities of the loan especially when the first or second defendants did not file a counter-claim for payment of the consideration payable under the Sale Deed.

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In the present case, the sale deed mentions the sale consideration of ₹ 14,60,000/- which was already received by the vendor. Thus, the Sale deed cannot be said to be void as per the judgment of the Hon’ble Supreme Court and the submission that it does not have any consequence is not acceptable. Thus, the judgments cited on behalf of the plaintiff do not apply to the present case.

¶77

In the present case, the sale deed had consequences. It had the effect of conveying the title to defendant No.1. The plaintiff has sought a relief of use and occupation charges, which shows that the possession has also been transferred in favour of the defendant; hence, the non-applicant/plaintiff must set aside the sale deed before any relief can be granted to him. Therefore, the plea of the nonapplicant/plaintiff that the suit is not governed by any provision of limitation because the sale deed does not have any effect is not acceptable. The sale deed is valid until set aside and the non-applicant/plaintiff cannot claim any relief without setting aside the sale deed.

¶78

A similar situation arose before the Hon’ble

¶79

Supreme Court in Raghwendra Sharan Singh v. Ram Prasanna Singh, (2020) 16 SCC 601: 2019 SCC OnLine SC 372 wherein the plaintiff filed a suit based on a gift deed without seeking the declaration regarding its invalidity. It was held at page 607:

¶80

“6.1. At the outset, it is required to be noted that the plaintiff has instituted the suit against the defendant for a declaration that the defendant has acquired no title and possession on the basis of the deed of gift dated 6-3-1981 and that the plaintiff has got title and possession in the said property. In the suit, the plaintiff has prayed for the following reliefs:

¶81

“A. That on the adjudication of the facts stated above, it be declared that the defendant acquired no title and possession on the basis of the said showy deed of gift dated 6-3-1981 and the plaintiff has got title and possession in the said property. B. That it be declared that the said showy deed of gift dated 6-3-1981 is not binding upon the plaintiff.

¶82

C. That the possession of the plaintiff be continued over the suit property and in case he is found out of possession, a decree for recovery of possession be passed in favour of the plaintiff.

¶83

D. That the defendant be restrained by an order of ad interim injunction from transferring or encumbering or interfering with the possession of the plaintiff over the suit land, during the pendency of the suit. E. That the cost of the suit be awarded to the plaintiff and against the defendant.

¶84

F. Any other relief or reliefs which the Court deems fit and proper, be awarded to the plaintiff and against the defendant.”

¶85

6.2. Considering the averments in the plaint, it can be seen that, as such, the plaintiff has specifically admitted that the plaintiff and his brother executed the gift deed on 6-3-1981. It is admitted that the gift deed is a registered gift deed. It also emerges from the plaint that till 2003, neither the plaintiff nor his brother (during his lifetime) challenged the gift deed dated 6-3-1981 nor, at any point in time, claimed that the gift deed dated 6-3-1981 was a showy deed of gift. In fact, it is the defendant-appellant herein who instituted the suit in the year 2001 against his brothers to which even the plaintiff was a party as Defendant 10 and that was a partition suit filed by the appellant herein-original defendant. It appears that the summon and the copy of the plaint — TS (Partition) Suit No. 203 of 2001 — was served upon the plaintiff in the year 2001 itself. Still, the plaintiff averred in the plaint that it came to the knowledge of the plaintiff with respect to the gift deed on 10-4-2003. Thus, it is borne out from the averments in the plaint that, till 2003, the plaintiff never disputed the gift deed and/or never claimed that the gift deed dated 6-3-1981 was a showy deed of gift. With the aforesaid facts and circumstances, the application submitted by the appellant-original defendant to reject the plaint in the exercise of powers under Order 7 Rule 11 CPC is required to be considered.

¶86

6.3. While considering the scope and ambit of the application under Order 7 Rule 11 CPC, a few decisions of this Court on Order 7 Rule 11 CPC are required to be referred to and considered. 6.4. In T. Arivandandam [T. Arivandandam v. T.V. Satyapal, (1977) 4 SCC 467] , while considering the very same provision i.e. Order 7 Rule 11 CPC and the decree of the trial court in

¶87

considering such application, this Court in para 5 has observed and held as under: (SCC p. 470)

¶88

“ 5 . We have not the slightest hesitation in condemning the petitioner for the gross abuse of the process of the court repeatedly and unrepentantly resorted to. From the statement of the facts found in the judgment of the High Court, it is perfectly plain that the suit now pending before the First Munsif's Court, Bangalore, is a flagrant misuse of the mercies of the law in receiving plaints. The learned Munsif must remember that if on a meaningful — not formal — reading of the plaint it is manifestly vexatious, and meritless, in the sense of not disclosing a clear right to sue, he should exercise his power under Order 7 Rule 11 CPC taking care to see that the ground mentioned therein is fulfilled. And, if clever drafting has created the illusion of a cause of action, nip it in the bud at the first hearing by examining the party searchingly under Order 10 CPC. An activist Judge is the answer to irresponsible lawsuits.”

¶89

6.5. In Church of Christ Charitable Trust & Educational Charitable Society [Church of Christ Charitable Trust & Educational Charitable Society v. Ponniamman Educational Trust, (2012) 8 SCC 706: (2012) 4 SCC (Civ) 612] , this Court in para 13 has observed and held as under: (SCC p. 715)

¶90

“ 13 . While scrutinising the plaint averments, it is the bounden duty of the trial court to ascertain the materials for cause of action. The cause of action is a bundle of facts which taken with the law applicable to them gives the plaintiff the right to relief against the defendant. Every fact which is necessary for the plaintiff to prove to enable him to get a decree should be set out in clear terms. It is worthwhile to

¶91

find out the meaning of the words “cause of action”. A cause of action must include some act done by the defendant since in the absence of such an act no cause of action can possibly accrue.”

¶92

6.6. In ABC Laminart (P) Ltd. v. A.P. Agencies [ABC Laminart (P) Ltd. v. A.P. Agencies, (1989) 2 SCC 163] , this Court explained the meaning of “cause of action” as follows: (SCC p. 170, para 12)

¶93

“ 12 . A cause of action means every fact, which if traversed, it would be necessary for the plaintiff to prove in order to support his right to a judgment of the court. In other words, it is a bundle of facts which taken with the law applicable to them gives the plaintiff a right to relief against the defendant. It must include some act done by the defendant since in the absence of such an act no cause of action can possibly accrue. It is not limited to the actual infringement of the right sued on but includes all the material facts on which it is founded. It does not comprise evidence necessary to prove such facts, but every fact necessary for the plaintiff to prove to enable him to obtain a decree. Everything which if not proved would give the defendant a right to immediate judgment must be part of the cause of action. But it has no relation whatever to the defence which may be set up by the defendant nor does it depend upon the character of the relief prayed for by the plaintiff.”

¶94

6.7. In Sopan Sukhdeo Sable [Sopan Sukhdeo Sable v. Charity Commr., (2004) 3 SCC 137] in paras 11 and 12, this Court has observed as under: (SCC p. 146)

¶95

“ 11 . In ITC Ltd. v. Debts Recovery Appellate Tribunal [ITC Ltd. v. Debts Recovery Appellate Tribunal, (1998) 2 SCC 70] it was held that the basic question to be decided while

¶96

dealing with an application filed under Order 7 Rule 11 of the Code is whether a real cause of action has been set out in the plaint or something purely illusory has been stated with a view to get out of Order 7 Rule 11 of the Code.

¶97

12 . The trial court must remember that if on a meaningful and not formal reading of the plaint, it is manifestly vexatious and meritless in the sense of not disclosing a clear right to sue, it should exercise the power under Order 7 Rule 11 of the Code taking care to see that the ground mentioned therein is fulfilled. If clever drafting has created the illusion of a cause of action, it has to be nipped in the bud at the first hearing by examining the party searchingly under Order 10 of the Code. (See T. Arivandandam v. T.V. Satyapal [T. Arivandandam v. T.V. Satyapal, (1977) 4 SCC 467]. )”

¶98

6.8. In Madanuri Sri Rama Chandra Murthy [Madanuri Sri Rama Chandra Murthy v. Syed Jalal, (2017) 13 SCC 174: (2017) 5 SCC (Civ) 602] , this Court has observed and held as under: (SCC pp. 178-79, para 7)

¶99

“ 7 . The plaint can be rejected under Order 7 Rule 11 if the conditions enumerated in the said provision are fulfilled. It is needless to observe that the power under Order 7 Rule 11 CPC can be exercised by the court at any stage of the suit. The relevant facts which need to be looked into for deciding the application are the averments of the plaint only. If on an entire and meaningful reading of the plaint, it is found that the suit is manifestly vexatious and meritless in the sense of not disclosing any right to sue, the court should exercise power under Order 7 Rule 11 CPC. Since the power conferred on the court to terminate civil action at the threshold is drastic, the conditions

¶100

enumerated under Order 7 Rule 11 CPC to the exercise of the power of rejection of plaint have to be strictly adhered to. The averments of the plaint have to be read as a whole to find out whether the averments disclose a cause of action or whether the suit is barred by any law. It is needless to observe that the question as to whether the suit is barred by any law, would always depend upon the facts and circumstances of each case. The averments in the written statement as well as the contentions of the defendant are wholly immaterial while considering the prayer of the defendant for rejection of the plaint. Even when the allegations made in the plaint are taken to be correct as a whole on their face value, if they show that the suit is barred by any law, or do not disclose a cause of action, the application for rejection of the plaint can be entertained and the power under Order 7 Rule 11 CPC can be exercised. If clever drafting of the plaint has created the illusion of a cause of action, the court will nip it in the bud at the earliest so that bogus litigation will end at the earlier stage.”

¶101

6.9. In Ram Singh [Ram Singh v. Gram Panchayat Mehal Kalan, (1986) 4 SCC 364] , this Court has observed and held that when the suit is barred by any law, the plaintiff cannot be allowed to circumvent that provision by means of clever drafting so as to avoid mention of those circumstances, by which the suit is barred by law of limitation.

¶102

7. Applying the law laid down by this Court in the aforesaid decisions on the exercise of powers under Order 7 Rule 11 CPC to the facts of the case in hand and the averments in the plaint, we are of the opinion that both the courts below have materially erred in not rejecting the plaint in the exercise of powers under Order 7 Rule 11 CPC. It is required to be

¶103

noted that it is not in dispute that the gift deed was executed by the original plaintiff himself along with his brother. The deed of gift was a registered gift deed. The execution of the gift deed is not disputed by the plaintiff. It is the case of the plaintiff that the gift deed was a showy deed of gift and therefore the same is not binding on him. However, it is required to be noted that for approximately 22 years, neither the plaintiff nor his brother (who died on 15-12-2002) claimed at any point in time that the gift deed was a showy deed of gift. One of the executants of the gift deed, brother of the plaintiff during his lifetime never claimed that the gift deed was a showy deed of gift. It was the appellant herein-original defendant who filed the suit in the year 2001 for partition and the said suit was filed against his brothers to which the plaintiff was joined as Defendant 10. It appears that the summon of the suit filed by the defendant being TS (Partition) Suit No. 203 of 2001 was served upon Defendant 10plaintiff herein in the year 2001 itself. Despite the same, he instituted the present suit in the year 2003. Even from the averments in the plaint, it appears that during these 22 years i.e. the period from 1981 till 2001/2003, the suit property was mortgaged by the appellant herein-original defendant and the mortgage deed was executed by the defendant. Therefore, considering the averments in the plaint and the bundle of facts stated in the plaint, we are of the opinion that by clever drafting the plaintiff has tried to bring the suit within the period of limitation which, otherwise, is barred by law of limitation. Therefore, considering the decisions of this Court in T. Arivandandam [T. Arivandandam v. T.V. Satyapal, (1977) 4 SCC 467] and others, as stated above, and as the suit is clearly barred by law of limitation, the plaint is required to be

¶104

rejected in the exercise of powers under Order 7 Rule 11 CPC.

¶105

8. At this stage, it is required to be noted that, as such, the plaintiff has never prayed for any declaration to set aside the gift deed. We are of the opinion that such a prayer is not asked cleverly. If such a prayer would have been asked, in that case, the suit can be said to be clearly barred by limitation considering Article 59 of the Limitation Act and, therefore, only a declaration is sought to get out of the provisions of the Limitation Act, more particularly, Article 59 of the Limitation Act. The aforesaid aspect has also not been considered by the High Court as well as the learned trial court.

¶106

9. Now, so far as the application on behalf of the original plaintiff and even the observations made by the learned trial court as well as the High Court that the question with respect to the limitation is a mixed question of law and facts, which can be decided only after the parties lead the evidence, is concerned, as observed and held by this Court in Sham Lal [Sham Lal v. Sanjeev Kumar, (2009) 12 SCC 454 : (2009) 4 SCC (Civ) 741]; N.V. Srinivasa Murthy [N.V. Srinivasa Murthy v. Mariyamma, (2005) 5 SCC 548: AIR 2005 SC 2897] as well as in Ram Prakash Gupta [Ram Prakash Gupta v. Rajiv Kumar Gupta, (2007) 10 SCC 59] , considering the averments in the plaint if it is found that the suit is clearly barred by law of limitation, the same can be rejected in exercise of powers under Order 7 Rule 11( d ) CPC.

¶107

10. In view of the above and for the reasons stated above, we are of the opinion that both the High Court as well as the learned trial court had erred in not exercising the powers under Order 7 Rule 11 CPC and in not rejecting the plaint in the exercise of powers under Order 7 Rule 11 CPC. For the reasons stated above, the impugned judgment and order [ Raghwendra

¶108

Sharan Singh v. Ram Prasanna Singh, 2013 SCC OnLine Pat 1527: (2014) 4 PLJR 147 ] passed by the High Court as well as the trial court cannot be sustained and the same deserves to be quashed and set aside. Consequently, the impugned judgment and order passed by the High Court dated 12-3-2013 [ Raghwendra Sharan Singh v. Ram Prasanna Singh, 2013 SCC OnLine Pat 1527: (2014) 4 PLJR 147] as well as the order passed by the Munsif, Danapur rejecting Order 7 Rule 11 application filed by the original defendant are hereby set aside. Consequently, the application submitted by the appellant herein-original defendant to reject the plaint under Order 7 Rule 11 CPC is hereby allowed and the plaint, being Title Suit No. 19 of 2003 is hereby rejected. The present appeal is allowed accordingly in terms of the above. No costs.”

¶109

It was held in Ramisetty Venkatanna v. Nasyam Jamal Saheb, 2023 SCC OnLine SC 521 that where the plaintiff had not challenged the partition deed to get over the limitation, the plaint is liable to be rejected. It was observed:

¶110

“28. Applying the law laid down by this Court in the aforesaid decisions on the applicability of Order VII Rule XI to the facts of the case on hand, we are of the opinion that the plaint ought to have been rejected in the exercise of powers under Order VII Rule XI(a) and (d) of CPC being vexatious, illusory cause of action and barred by limitation. By clever drafting and not asking any relief with respect to the partition deed dated 11.03.1953, the plaintiffs have tried to circumvent the provision of the limitation act and have tried to maintain the suit which is nothing but an abuse of the process of court and the law.”

¶111

In the present case also, the nonapplicant/plaintiff has not challenged the sale deed to get over the limitation and the plaint is to be rejected as per the judgment of the Hon’ble Supreme Court.

¶112

The non-applicant/plaintiff has sought the relief of use and occupation charges with respect to the suit land w.e.f. 13.02.2016 till the filing of the suit amounting to ₹30,00,000/- with interest @ 18% per annum. The use and occupation charges could have been claimed only for three years from the date of filing of the suit and the use and occupation charges w.e.f 13.02.2016 till the filing of the suit are barred by limitation when the suit was filed on 11.01.2024.

¶113

The plaintiff has also sought relief of recovery of the total consideration of ₹1,15,50,000/along with interest @ 18% per annum from 03.02.2016 till the final realization of the amount. He stated in para 21 that cause of action arose to him on 24.05.2014 when the agreement of sale was reduced into writing and thereafter it arose on 03.02.2016 when the applicants/defendants No.1 to 3 unlawfully succeeded in getting the sale deed executed without the payment

¶114

of any amount of sale consideration. This shows that the cause of action for filing the suit for recovery of ₹1,15,50,000/- had accrued to the plaintiff on 03.02.2016, the date of execution of the sale deed and a suit filed on 11.01.2024 after the lapse of 8 years from the date of accrual of the cause of action for the recovery of money is barred by limitation.

¶115

The non-applicant/plaintiff has not sought any declaration regarding the invalidity of the sale deed. He has lost the title by the execution of the sale deed. He cannot claim himself to be the owner and he cannot say that he is entitled to possession and the applicants/defendants No.1 to 3 should be restrained from changing the nature of the suit land. Thus, a civil suit filed by a person against the true owner seeking the possession based on the title and restraining the real owner from changing the nature of the suit land is not maintainable because the plaintiff does not have any cause of action to file a suit against the true owner in whose favour a valid sale deed exists. The plea that the sale deed is void and need not be set aside is not correct as found out above.

¶116

Therefore, the part of the claim made by the plaintiff does not disclose any cause of action and the part of the claim made by the plaintiff is barred by limitation. Hence, the plaint is liable to be rejected under Order VII Rule 11 CPC.

¶117