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Poppat Jamal & Sons,... v. N.M Venkatachalapath...
Factual and Procedural Background
The respondents/plaintiffs filed Suit O.S No. 2154 of 2005 in the II Assistant Judge, City Civil Court, Chennai, seeking a permanent injunction restraining the defendant from interfering with possession and enjoyment of the suit property. The plaintiffs alleged that a sale deed dated 15.2.1943 in favour of the first defendant was a sham transaction and had been set aside by this Court in O.A No. 553 of 1943 filed by their predecessors in title, and thus no title passed to the defendant. The defendant denied these averments in a written statement. The plaintiffs also relied on an unregistered Will dated 13.10.1948, found in 2002, to assert that the suit was filed within limitation.
The defendant filed an Interlocutory Application (I.A No. 4859 of 2006) to direct the plaintiffs to produce the order passed in O.A No. 553 of 1943 or reject the plaint for lack of cause of action. The learned II Assistant Judge rejected this application, allowing the plaintiffs to produce the order later and advising the defendant to obtain a certified copy if needed. The defendant filed the present Civil Revision Petition (CRP) challenging this rejection.
Legal Issues Presented
- Whether the plaint in Suit O.S No. 2154 of 2005 should be rejected for failure to produce the order passed in O.A No. 553 of 1943, which the plaintiffs relied upon as the basis for their claim.
- Whether the plaintiffs’ suit is barred by fraud, misrepresentation, and suppression of facts, warranting rejection of the plaint at the threshold.
- The legal effect of the order passed in O.A No. 553 of 1943 on the plaintiffs' claim and whether it supports the cause of action.
Arguments of the Parties
Revision Petitioner (Defendant)'s Arguments
- The unregistered Will relied upon by the plaintiffs was never propounded and cannot be admitted as evidence.
- The plaintiffs failed to produce the order passed in O.A No. 553 of 1943, despite relying on it to file the suit.
- The order in O.A No. 553 of 1943, produced by the defendant, shows the application to set aside the auction sale was dismissed, contrary to the plaintiffs' claim that it was allowed.
- The sale deed dated 15.2.1943 was valid and registered, following a lawful auction sale in 1941, and the defendant obtained possession through a decree in O.S No. 455 of 1942.
- The plaintiffs' suit is barred by limitation and is based on fraud and misrepresentation, as they have suppressed material facts and filed the suit with unclean hands.
- The court has a duty to reject a plaint where fraud is established or where the plaint is based on falsehood or suppression.
Respondents (Plaintiffs)' Arguments
- The suit is based on the cancellation of the sale deed by this Court in O.A No. 553 of 1943.
- The unregistered Will found in 2002 justifies the filing of the suit within limitation.
- The plaintiffs intended to produce the order passed in O.A No. 553 of 1943 at a later stage as permitted by the trial court.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| S.P Chengalvaraya Naidu v. Jagannath, 1994 (1) SCC 1 | Definition and nature of fraud as deliberate deception for unfair advantage. | The Court relied on this precedent to establish that the plaintiffs acted fraudulently by suppressing facts and making false representations. |
| Roshan Deen v. Preeti Lal, 2002 (1) SCC 100 | Legal principles concerning fraud and misrepresentation. | Considered to reinforce the settled legal position that fraud vitiates claims and warrants dismissal. |
| Ram Preeti Yadav v. U.P Board of High School and Intermediate Education, 2003 (8) SCC 311 | Fraudulent conduct and its consequences in civil proceedings. | Applied to support the rejection of the plaint due to fraud and misrepresentation by the plaintiffs. |
| Ashok Leyland Ltd. v. State of T.N, 2004 (3) SCC 1 | Fraud in civil litigation and its impact on reliefs sought. | Used to affirm the principle that courts must reject claims tainted with fraud. |
| State of A.P and another v. T. Suryachandra Rao, 2005 (6) SCC 149 | Fraud and misrepresentation in legal proceedings. | Referenced to confirm that fraud negates entitlement to relief and mandates dismissal. |
Court's Reasoning and Analysis
The Court analyzed the factual matrix and found that the plaintiffs’ claim was premised on an alleged order setting aside the auction sale in O.A No. 553 of 1943. However, the defendant produced the actual order showing the application was dismissed, contradicting the plaintiffs’ assertion. The Court noted that the plaintiffs failed to produce the relied-upon order before the trial court, undermining their cause of action.
The Court further observed that the plaintiffs’ reliance on an unregistered Will found decades later appeared contrived and was insufficient to validate their suit within limitation. The conduct of the plaintiffs was characterized as fraudulent, involving suppression of material facts and misrepresentation.
Applying settled legal principles on fraud, as established by the cited Supreme Court precedents, the Court concluded that the plaintiffs had not approached the Court with clean hands and were therefore not entitled to any relief. Consequently, the Court held that the plaint deserved rejection at the threshold.
Holding and Implications
The Civil Revision Petition is allowed. The order passed in I.A No. 4859 of 2006 rejecting the defendant’s interlocutory application is set aside, and the plaint in O.S No. 2154 of 2005 is consequently rejected.
The direct effect of this decision is the dismissal of the plaintiffs’ suit at an early stage due to fraud and failure to establish a cause of action. No new precedent is established beyond the application of existing principles regarding fraud and plaint rejection.
1. As against the dismissal of the Interlocutory Application filed by the first defendant to reject the Plaint, the present CRP has been filed.
2. In spite of private notice, the respondents/plaintiffs have not taken steps to appear either in person or through advocates.
3. The respondents are the plaintiffs in O.S No. 2154 of 2005 on the file of the II Assistant Judge, City Civil Court, Chennai. The Suit is filed for permanent injunction restraining the defendant from interfering with the possession and enjoyment of the suit property. According to the plaintiffs the alleged sale deed dated 15.2.1943 by the third parties in favour of the first defendant is not binding on the true owners as it is a sham and nominal transaction which illegal sale deed was subsequently set aside by this Court in O.A No. 553 of 1943 which was filed by the plaintiffs' predecessors in title. According to the plaintiffs, by stating all the illegalities and the High Court's allowing the Application by setting aside the said sale, no title passed on to the first defendant and prayed for permanent injunction against the defendant.
4. The defendant filed a written statement denying all the averments in the Plaint.
5. In Paragraph 15 of the Plaint, it is stated that in the year 2002 the plaintiffs found an unregistered Will dated 13.10.1948 in a old trunk box, said to have been executed by N.R Rengachary. It is based on the said Will the suit is said to have been filed within time.
6. Learned counsel for the revision petitioner would contend that the Will was first of all not propounded and cannot be marked as a document. Further the plaintiffs have filed the Suit based on the order of this Court dated 15.4.1943, passed in O.A No. 553 of 1943, by which the sale in favour of the first defendant was set aside. But the said order was not produced in the Court and therefore, the petitioner filed I.A No. 4859 of 2006 to direct the respondents/plaintiffs to produce copy of the order in said O.A No. 553 of 1943 passed by this Court and if not to reject the plaint as there is no cause of action arises in such a case. But the learned II Assistant Judge, City Civil Court, by the impugned order, rejected the Interlocutory Application holding that the plaintiffs will produce the same at a later point of time and if the defendants are sure that there is no such order passed by the High Court, they can very well apply for certified copy of the same and produce the same. Aggrieved over the same, the present CRP is filed.
7. It is pertinent to note that the plaintiffs based their suit claim on a specific averment that this Court in O.A No. 553 of 1943 had cancelled the auction sale held on 2.2.1941 Though the respondents/plaintiffs failed to produce the order before the learned II Additional Judge, City Civil Court, Chennai, the revision petitioner/first defendant has produced the order dated 15.4.1943 passed in Application No. 553 of 1943 which would show that the said Application which was filed to set aside the auction sale on 2.2.1941 was dismissed. But it is based on the said order as if the Application has been allowed, the Suit has been filed.
8. Learned counsel for the revision petitioner also produced copy of the sale deed dated 15.2.1943 which has been registered on 20.2.1943 as Document No. 296 of 1943 in the office of the Sub-Registrar, Sembium following the auction sale on 2.2.1941 whereunder the first defendant purchased the suit property in an auction sale consideration of Rs. 14,000/- and paid an advance of Rs. 3500 on 2.2.1941 and on 1.4.1941 paid the balance of Rs. 10,500/- and after vacating the occupiers of the property by obtaining a decree in O.S No. 455 of 1942 from the Chingleput District Munsif's Court, the first defendant was put in possession.
9. Moreover, the contention of the learned counsel for the respondents/plaintiffs is that they found the unregistered Will in the year 2002 from an old trunk box is so mentioned only to file the Suit which is hopelessly barred by limitation.
10. The above facts would only go to show that the respondents by playing fraud and misrepresentation have filed the Suit. The plaintiffs have not approached the Court with clean hands and are guilty of fraud, suppression of facts and misrepresentation and as such they are not entitled for any relief. Fraud is proved when it is shown that a false representation has been made (i) knowingly, or (ii) without belief in its truth, or (iii) recklessly, careless whether it be true or false. Fraud is a conduct either by letter or words, which induces the other person or authority to take a definite determinative stand as a response to the conduct of the former either by words or letter. Although negligence is not fraud but it can be evidence on fraud. A “fraud” is an act of deliberate deception with the design of securing something by taking unfair advantage of another. It is a deception in order to gain by another's loss. It is a cheating intended to get an advantage as has been held by the Apex Court in S.P Chengalvaraya Naidu v. Jagannath, 1994 (1) SCC 1. This aspect of the matter has also been considered by the Hon'ble Supreme Court in its decisions in Roshan Deen v. Preeti Lal., 2002 (1) SCC 100; Ram Preeti Yadav v. U.P Board of High School and Intermediate Education, 2003 (8) SCC 311; Ashok Leyland Ltd. v. State of T.N, 2004 (3) SCC 1; and State of A.P and another v. T. Suryachandra Rao, 2005 (6) SCC 149. In view of the settled legal position of law, the case of the plaintiffs has to be thrown out at the threshold and in this case, it is the duty of the Court to reject the Plaint.
11. In the result, the CRP is allowed setting aside the order passed in I.A No. 4859 of 2006 on the file of the learned II Assistant Judge, City Civil Court, Chennai and consequently rejecting the Plaint in O.S No. 2154 of 2005.
12. In view of the order passed in the main CRP, no order need be passed in the Miscellaneous Petition. No costs.
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