Absence Of Specific Prayer Seeking Transfer Of Possession Won’t Have Bearing On Character Of Suit U/S. 16(d) CPC: Supreme Court

The Supreme Court held that the absence of a specific prayer seeking transfer of possession will not have bearing on the character of the Suit under Section 16(d) of the Civil Procedure Code (CPC).

The Court held thus in Special Leave Petitions (SLPs) filed against the Order of the Delhi High Court by which the Appeals were allowed and the Plaint was ordered to be returned for presenting it before the appropriate Court having territorial jurisdiction to try the Suit for specific performance.

The two-Judge Bench of Justice J.B. Pardiwala and Justice R. Mahadevan observed, “… it is clear from the terms of the alleged contract between the parties that the transfer of possession of the suit property is implicit in the said contract and absence of a specific prayer seeking transfer of possession would not have any bearing on the character of the suit, which is one covered by Section 16(d) of the CPC.”

The Bench remarked that an interpretation which gives rise to the possibility of such misuse of law cannot be allowed.

AOR Kunal Verma appeared for the Petitioner while AORs Ajit Pudussery and Mayuri Raghuvanshi appeared for the Respondents.

In this case, the Petitioner who was the original Plaintiff, instituted a Civil Suit in the High Court for permanent injunction and specific performance of the contract entered into with the Respondents. It was the case of the Plaintiff that sometime in September 2003, the original Defendant offered to sell to it commercial space. After discussions and negotiations regarding the same, a written communication was received by the Plaintiff containing the offer in relation to the Suit property and the terms and conditions for the transaction. The offer was accepted and thereafter, disputes arose between the parties regarding certain terms contained in the agreement.

As per the Plaintiff, despite several attempts on its part to negotiate the terms, the Defendants insisted upon unreasonable, arbitrary, and unconscionable terms with a view to wriggle out of their liability arising out of the binding contract. Being aggrieved, the Plaintiff instituted a Suit for specific performance and permanent injunction. The Single Judge overruled the objection raised by the Defendants as regards the territorial jurisdiction. The Defendants challenged this by filing three Appeals before the Division Bench and the same were allowed. Resultantly, the Plaintiff approached the Apex Court.

The Supreme Court in the above regard, noted, “This Court in Harshad Chiman Lal Modi v. DLF Universal Ltd. reported in (2005) 7 SCC 791 observed that Section 16 of the CPC recognises a well-established principle that actions against res or property should be brought in the forum where such res is situate. A court within whose territorial jurisdiction the property is not situate has no power to deal with and decide the rights or interests in such property. In other words, this Court held that a court has no jurisdiction over a dispute in which it cannot give an effective judgment.”

The Court agreed with the view expressed by the High Court that the proviso to Section 16 would be applicable to a case where the relief sought by Plaintiff can be obtained through the personal obedience of the Defendant, that is, the Defendant has not to go out of the jurisdiction of the Court at all for the purpose of the grant of relief, however, since the case would require the Defendants to go to Gurugram for the purpose of execution of the Sale Deed, the proviso to Section 16 of the CPC will not be applicable.

“Thus, while the decision in Adcon Electronics (supra) proceeds on the understanding that a suit for specific performance of an agreement to sell is an action in personam, the decision in Babu Lal (supra) takes into account the change brought about by the introduction of Sections 22 and 28 to the Specific Relief Act, 1963 respectively which has changed the nature of the relief available under Section 22 by allowing the plaintiff to seek the relief of possession, partition, etc. simultaneously along with the prayer for specific performance”, it said.

Accordingly, the Apex Court dismissed the SLPs.

Cause Title- Rohit Kochhar v. Vipul Infrastructure Developers Ltd. & Ors. (Neutral Citation: 2024 INSC 920)

Appearance:

Petitioner: AOR Kunal Verma

Respondents: AORs Ajit Pudussery, Mayuri Raghuvanshi, Advocates Ankit Virmani, and Ruchika Agarwala.

Click here to read/download the Judgment