JUDGMENT
Sanjay Kishan Kaul, J.
IA No. 6174/2004 IN CS (OS) No. 1027/2004
1. The plaintiff has filed a suit for declaration and injunction in respect of the property bearing No. F-9, Hauz Khas Enclave, New Delhi. The plaintiff claims to be a joint owner of the said property to the extent of one-half share with defendant No. 1.
2. The plaintiff is stated to be medical practitioner settled in United Kingdom for the last several years. The plaintiff and defendant No. 1 are stated to have purchased the property in question in pursuance to five Sale Deeds from the Vendors in respecof one-fifth undivided share each. The sale consideration was paid both by the plaintiff and defendant No. 1. In 1988, on one of the visits of the plaintiff to India, defendant No. 1 mentioned about certain financial matters to him and the plaintiff ofered to execute a Relinquishment Deed of his share in the said property. The plaintiff informed defendant No. 1 vide communication dated 16.03.1989. The said letter records that the plaintiff had executed a Deed of Relinquishment dated 20.12.1988. It is stated that this letter was replied to by defendant No. 1 vide communication dated 03.04.1989 expressing her inability to accept the relinquishment or gift as she was not in a position to revoke the Relinquishment Deed. It is, thus, stated that the Relinquishment Deed was never acted upon.
3. The real dispute actually is that in the year 1992, defendant No. 2 Company availed of certain credit and financial facilities from Oriental Bank of Commerce, defendant No. 3 herein. In 1993, the Bank required additional collateral securities and the tank suggested that Smt. Uma Gupta, defendant No. 1 being the wife of the promoter Shri R.K. Gupta, the plaintiff should furnish a personal guarantee by way of equitable mortgage of the property. The plaintiff claims that he had nothing to do with the buiness of defendant No. 2, but he agreed to sign the documents.
4. The plaintiff goes on to state that the plaintiff, not being based in Delhi, tried to convince the bankers as well as defendant No. 2 Company to convey to the Bank that the guarantee of the plaintiff was only limited to his own share in the property an that he should be released from the personal guarantee. Defendant No. 3 Bank is stated to have waived the personal guarantee of the plaintiff vide communication dated 08.10.1998 and, thus, the restricted guarantee in respect of share of the property also stood waive.
5. It is in view of the aforesaid situation that a decree for declaration is sought in respect of the half share of the property that it vests with the plaintiff and that no valid Relinquishment Deed was executed and a permanent injunction from disturbing the ownership of the plaintiff.
6. The defendants have opposed the suit. Defendant No. 1 has also filed the Written Statement disputing the claim of the plaintiff to the half-share and has relied upon the Relinquishment Deed dated 20.12.1988. There has been vigorous contest by the Banby filing Written Statement and the case set out is that in view of the said Relinquishment Deed, it was assumed that the plaintiff would have no right or interest in the property and only the personal guarantee of the plaintiff was released and not the mortgage created in respect of the property in question. The Relinquishment Deed is stated to have been duly registered on 22.12.1988 and till the filing of the suit, the same has not been revoked by any registered Deed or challenge in any court of law.
The communication between the plaintiff and defendant No. 1 of 1989 is stated to be manufactured. The suit is alleged to be collusive on account of the fact that the Bank has filed the claim for recovery of Rs. 35,89,81,794.34 against defendant No. 2 in which defendant No. 1 is also a party as one of the mortgager. The property is, thus, liable to be sold for recovery of the dues of the Bank.
7. The property was stated to have been offered to the Bank as security in the account of M/s. Ritika Electronics and on 18.12.1987, the plaintiff and defendant No. 1 submitted the original title papers. Subsequently, this property was given as a collaterl security by way of equitable mortgage in the account of defendant No. 2 Company, M/s. Vintron Informatics Limited. Shri R.K. Gupta, husband of defendant No. 1, wrote a letter to the Bank dated 16.03.1998 in respect of the personal guarantee sought of defendant No. 1 and the plaintiff restricted to the value of the share in the property and requesting to waive the condition of personal guarantee of the plaintiff on account of the fact that the property stood alone in the name of defendant No. 1. The plaintiff is stated to have been introduced earlier when he was co-owner of the property in view of the Relinquishment Deed, but defendant No. 1 had become the sole owner of the property. This position was again reiterated by the letter dated 02.05.1998.
8. It may be noticed that interim orders were passed on 20.09.2004 in the aforesaid application restraining the defendants from disturbing the joint ownership of the plaintiff.
9. Learned counsel for the plaintiff has emphasised that the Relinquishment Deed was never acted upon and the property is still recorded in the joint names in the MCD and the Electricity Department. Even defendant No. 3 Bank had recognised the plaintiffs the joint-owner after December, 1988 inter alia vide letters dated 24.11.1993 and 13.02.1998. It is, thus, submitted that when the personal guarantee was waived vide letter dated 08.10.1998, his share of the property also became free.
10. Learned counsel for defendants No. 3 and 4 Bank, on the other hand, has opposed the interim application on the ground that the suit is only a rouse to somehow save the property in view of the claim having been filed by the Bank. It is further statedhat the property which had been mortgaged with the Bank has never been released and it is only the personal guarantee of the plaintiff, which was released. This is stated to be specifically in view of the Relinquishment Deed executed and registered.
11. Learned counsel for the Bank also submitted that ex facie the claim of the plaintiff is barred by time in view of the fact that the Deed of 1988 has never been challenged or revoked by a registered document till filing of the suit in the year 2004 Iis submitted that the period of three years within which the same could be challenged had long passed. In this behalf, reference was made to the judgment of learned Single Judge of this Court in Surinder Sethi v. Deepak Kapoor, 2001 (57) DRJ 123.
12. It may be noticed that the plaintiff has subsequently filed IA No.1601/2005 under Order VI Rule 17 read with Section 151 CPC for amendment of the plaint. However, in my considered view, there was no reason to delay hearing on the injunction applicatin on account of the said application since undisputedly the interim injunction had been granted and sought on the basis of the plaint as originally presented and the amendment application could not be used to delay the disposal of the interim application
13. The facts on record clearly show that the property was originally purchased in a manner whereby the plaintiff and defendant No. 1 had equal share. It is,however, equally not in dispute that a registered Relinquishment Deed was executed by the plaintiff in favor of defendant No. 1 as far back as on 20.12.1988. This Deed was never cancelled by any registered document nor was any claim made by the plaintiff or relief sought in any suit for declaration of the said document as not binding upon the partis till the filing of the present suit.
14. The allegation of the plaintiff is that this document was never acted upon. Once the plaintiff registered such a document and permits defendant No. 1 to act upon the same by making representations to the Bank on the basis of the said document of exclusive ownership of the property, the plaintiff cannot claim that the rights of such third-parties would be affected by some allegedly mutually arrangement between the plaintiff and defendant No. 1 not to act on the said Relinquishment Deed.
15. A reading of the Written Statement of defendants No. 3 and 4 also shows that the property was originally taken to secure the loan for another firm, namely, M/s. Ritika Electronics and at that stage both the plaintiff and defendant No. 1 were the co-owners. It appears that on the basis of the said position, the Bank had possibly insisted that the plaintiff should also join hand in executing the documents for mortgage so that there was no problem in future. However, on the insistence of the husband of defendant No. 1 and defendant No. 1 furnishing undertakings to the Bank of exclusive ownership of the property, the personal guarantee of the plaintiff was discharged. The basis was the Relinquishment Deed, which had been duly registered.
16. In my considered view, it is obvious that the plaintiff has now woken up after so many years to state that the Relinquishment Deed dated 20.12.1988 has not been acted upon in view of the claim filed by the Bank for foreclosure of mortgage. This is clearly an illegal attempt to prevent the Bank from Realizing its dues from the sale of the immovable property, which stands mortgaged to the Bank.
17. The plaintiff has, in fact, come to Court without full disclosure of facts and has failed to establish any case much less prima facie case for continuation of the injunction order. The balance of convenience is, in fact, in favor of the Bank as the tank must be permitted to prosecute its claim against the mortgaged property for the dues outstanding and public money would be stuck only on account of the illegal conducts and confusion sought to be created by the plaintiff in so far as recovery of the amount is concerned.
18. The application is without any merits and is dismissed with costs of Rs. 10,000/-.
IA No. 1601/2005 (O-VI, R-17 r/w S-151 CPC)
1. This is an application filed by the plaintiff for amendment of the plaint. In terms of these amendments now, the plaintiff seeks to include the plea of waiver against defendant No. 3 Bank on the basis of certain communications of the Bank. The cause of action paragraph is also sought to be amended by creating a cause of action in January / February, 2004 when the plaintiff is alleged to have requested the NOC in respect of the property, which was not given.
2. Learned counsel for the Bank sought to contend that mutually destructive pleas could not be withdrawn and the admissions made in favor of the plaintiff also could not be so withdrawn. It was submitted that a party is not allowed in amendment to set ua new case. A further submission was that if the amendment seeks to set up a time-barred claim, the same was not permissible.
3. To advance these propositions, reference was made to the judgment of learned Single of Punjab and Haryana High Court in Paramjit Kaur v. Sajja Singh, 2005 (2) ISJ (Banking) 177, B.K. Narayana Pillai v. Parameswaran Pillai and Anr., (2001) 1 SCC 712, Rajumar v. Dipender Kaur Sethi, and Pirgonda Hongonda Patil v. Kalgonda Shidgonda Patil and Ors., .
4. In so far as the aforesaid judgments are concerned, there is no doubt on any of the principles of law. However, the defendants must establish as to how the amendment to the plaint would give rise to any of these legal conclusions. On a reading of the amendments, I find that there cannot be any objection to the amendment of the plaint.
5. The application is allowed subject to payment of Rs. 5,000/- as costs and the amended plaint is taken on record.
IA No. 535/2005 IN CS (OS) No. 1027/2004
1. This is an application filed by defendants No. 3 and 4 under Order VII Rule 11 read with Section 151 Code of Civil Procedure, 1908 (hereinafter to be referred to as, ‘the Code’) for rejection of the plaint being without any cause of action and barred the law of limitation.
2. The application refers to the cause of action paragraphs in terms whereof the last cause of action is alleged in 1998. It is, thus, submitted that in view of the provisions of Article 58 of the Limitation Act, 1963, the period of limitation prescribed is three years from the time when right to sue has accrued to obtain any declaration. The plea has also been raised that the plaintiff has not come with clean hands before this Court as he did not file a copy of the Relinquishment Deed, which was duly registered. In fact, this aspect was deliberately kept vague. The Relinquishment Deed was registered on 22.12.1988 and was dated 20.12.1988. Thus, no declaratory relief in that behalf can be passed.
3. The aspect of the Bank filing a claim against defendant No. 1 has also been mentioned though the same may not be of much use for determination of the present application.
4. Rule 11 of Order VII of the Code is as under :-
“11. Rejection of plaint. – The plaint shall be rejected in the following cases :-
(a) where it does not disclose a cause of action;
(b) where the relief claims is undervalued, and the plaintiff, on being required by the Court to correct the valuation within a time to be fixed by the Court, fails to do so;
(c) where the relief claimed is properly valued but the plaint is written upon paper insufficiently stamped, and the plaintiff, on being required by the Court to supply the requisite stamp- paper within a time to be fixed by the Court, fails to do so;
(d) where the suit appears from the statement in the plaint to be barred by any law;
(e) where it is not filed in duplicate.
(f) where the plaintiff fails to comply with the provisions of rule 9;
Provided that the time fixed by the Court for the correction of the valuation or supplying of the requisite stamp-paper shall not be extended unless the Court, for reasons to be recorded, is satisfied that the plaintiff was prevented by any cause of an eceptional nature for correcting the valuation or supplying the requisite stamp-paper, as the case may be, within the time fixed by the Court and that refusal to extend such time would cause grave injustice to the plaintiff.”
5. In order to determine whether the suit does not disclose any cause of action or is barred by any law, I consider it appropriate to consider the amended plaint in view of the amendments having been allowed.
6. There is no doubt that in the plaint as it originally stood, the cause of action did not contain even an averment of the existing of cause of action within the span of three years prior to the suit being filed. The cause of action paragraph read as uner :-
“15. That the cause of action to the plaintiff against the defendants arose in 1993 when he along with Smt. Uma Gupta signed the documents of collateral security. It again arose in 1995 or 1996 when a request to restrict his guarantee to his share alone was made and on 8th October, 1998 when his signatures was waived. It arose recently when he asked the defendants to recognise him as a joint-owner of one-half but the defendants failed. The said cause of action still subsists.”
The plaint was, thus, ex facie barred by time.
7. If the amended plaint is taken into consideration whereby the relevant paragraph has been amended, it would read as under :-
“15. That the cause of action to the plaintiff against the defendants arose in 1993 when he along with Smt. Uma Gupta signed the documents of collateral security. It again arose in 1995 or 1996 when a request to restrict his guarantee to his share alone was made and on 8th October, 1998 when his signatures was waived. It arose recently when he asked the defendants to recognise him as a joint-owner of one-half but the defendants failed. The said cause of action still subsists.
The Plaintiff submits that the cause of action finally arose in favor of the Plaintiff and against the Defendants in the month of January-February, 2004 when the Plaintiff during his stay requested the Defendants to issue NOC in favor to the effect that the property bearing No. F-9, Hauz Khas Enclave, New Delhi to the extent of half share belonging to the Plaintiff is free from any charge or encumbrances but the Defendant Nos. 1 to 4 refused to accede to the request of Plaintiff for issuance of the NC in his favor and thereby for the first time in February, 2004 disputed / denied the legal right of Plaintiff as owner to the extent of -+ share in property bearing No. F-9, Hauz Khas Enclave, New Delhi and which is free from any charge or lien, encumbances, etc.”
8. There is no doubt that now the allegation about the cause of action arising in the month of January-February, 2004 has been raised. However, that, in my considered view, will not be of much help to the plaintiff.
9. The plaintiff has sought a relief of declaration in respect of the property in question on the basis that no Relinquishment Deed was validly executed by the plaintiff or accepted by defendant No. 1. The cause of action for setting aside such Relinquisment Deed would arise on the date of its execution. The incorporation of this relief itself shows that the plaintiff is conscious of deprivation of his title by the execution of Relinquishment Deed. This happened in the year 1988. The plaintiff admittely did not execute a registered document to cancel the same. Is it permissible for the plaintiff to file the suit by merely alleging in the cause of action paragraph that the failure to give NOC in respect of the property would give rise to the cause of action? In my considered view, the answer to this question is in the negative.
10. There can be no doubt that the relevant Article of the Limitation Act, which would apply in the present case, would be Article 58 and the same reads as under :-
“Part – III – Suits related to Declarations”
Article 58
Description of Suit Period of Limitation Time from which To obtain any other declaration Three years When the right to sue first accrues.
11. The right to sue arose when the document was executed and duly registered. This document was acted upon to seek release of plaintiff from guarantee to the Bank. The suit has been filed 16 years after execution of the Deed and, in my considered view, is ex facie barred by limitation even on the averments made in the plaint. The suit is, thus, clearly barred by the law of limitation. It would be relevant to note that the Apex Court in T. Arviandandam v. T.V. Satyapal and Anr., AIR 1977 S.C. 421 has decided that where a plaint is manifestly vexatious and merit less in the sense of not disclosing a clear right to sue, the trial court should exercise its powers under Order VII Rule 11 of the Code and bogus litigation should not be permitted too on.
12. It is also relevant to note that the reliefs claimed for are in the nature of declaration and injunction, which have an equitable element. The plaintiff failed to come clean before the Court disclosing all the facts. A copy of the Relinquishment Deed was not even filed nor was the fact of it being registered clearly set out in the plaint. In such a situation, there can be hardly any case made out for indulgence for grant of any such relief to the plaintiff.
13. In view of the aforesaid, the application is allowed.
CS (OS) No. 1027/2004
1. In view of the application of defendants No. 3 and 4 Bank being IA No. 535/2005 having been allowed, the plaint is rejected and the suit is dismissed with costs.