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Case Number

Civil Revision Application No. 1588 of 1993*

Advocates

S.M.Shah
S.B.Parikh
M.S.Shah
J.R.Nanavati

Judges

Hon'ble Mr. Justice Jagdish Madhurlal Panchal

Acts

Section 37 of the Gujarat Co-operative Societies Act, 1961 and Rule 3 of the Gujarat Co-operative Societies Rules, 1965,
provisions of the Bombay Prevention of Fragmentation and Consolidation of Holdings Act, 1947.
provisions of the Prevention of Fragmentation and Consolidation of Holdings Act, 1947.
provisions of the Prevention of Fragmentation and Consolidation to Holdings Act, 1947.
Section 15 of the Mines and Minerals (Regulation and Development) Act, 1957,
provisions of Section 55(vi)(b) of the Transfer of Property Act, 1882,
URBAN LAND CEILING AND REGULATION ACT 1976
SECTION 20 URBAN LAND CEILING AND REGULATION ACT 1976
Section 37 of the Gujarat Cooperative Societies Act
provisions of the Specific Reliefs Act, 1963,
Section 115 of the Code of Civil Procedure.
Section 11 of the Code of Civil Procedure.
SECTION 96 CIVIL PROCEDURE CODE
Gujarat Cooperative Societies Act, 1961

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Smart Summary

Structured Summary of the Opinion (M. Panchal, J.)

Factual and Procedural Background

This revision arises from a decision refusing leave to a non-party to appeal. The sequence is as follows.

The dispute concerns a plot of land (about 4 Acres 22 Gunthas) in Jamnagar, originally owned by Late Maharaja Shri Indravijaysinhji Dilawarsinhji Jadeja. By a gift deed dated 16 November 1963, about one acre was gifted to Dolatram Mulshanker Dave.
Heirs of the donee (opponent Nos. 1 to 5) instituted Regular Civil Suit No. 740 of 1986 against opponent Nos. 6 and 7 (heirs of the Maharaja) for declaration and injunction concerning the gift deed.
Separately, the petitioners claim an agreement to sell dated 10/12 July 1980 (dates in the opinion variously cited) executed by the Maharaja in favour of members of a proposed Vijay Co-operative Society, with an earnest payment of Rs. 81,000 claimed by the petitioners.
The parties to RCS No. 740 of 1986 filed a compromise (purshis Exh. 68 dated 1 November 1993); the trial Court directed recording the compromise and a consent decree was drawn on 18 November 1993.
The petitioners, who were not parties to RCS No. 740 of 1986, applied by Civil Misc. Application No. 2 of 1993 (filed 25 November 1993) before the District Court, Jamnagar seeking leave to file an appeal as non-parties against the consent decree of 18 November 1993. The District Judge rejected that application by order dated 10 December 1993 (the impugned order below Exh.1).
The present Civil Revision Application under Section 115 of the Code of Civil Procedure challenges that refusal to grant leave to appeal.

Legal Issues Presented

Whether the petitioners, being non-parties to RCS No. 740 of 1986, are "adversely affected" by the consent decree of 18 November 1993 so as to entitle them to leave to appeal under the appellate provisions (Section 96 CPC and Explanation 6 to Section 11 CPC) and the appellate Court's discretion.
Whether the petitioners' agreement to sell (dated July 1980) executed on behalf of a proposed (non-existent) co-operative society creates any enforceable right (or charge) that could render them adversely affected by the consent decree.
Whether allegations of fraud or collusion in arriving at the consent decree (including reliance on other administrative proceedings such as mutation refusals and proceedings under the Urban Land (Ceiling and Regulation) Act, 1976) justify granting leave to appeal to the petitioners.
Whether, in view of decisions pending or decided in higher courts (including a Division Bench decision that is the subject-matter of an appeal to the Supreme Court), this Court should stay proceedings or permit an appeal to be filed and stayed.

Arguments of the Parties

Petitioners' Arguments

The petitioners were not parties to RCS No. 740 of 1986 but the consent decree adversely affects their rights under an agreement for sale dated July 1980 (they claim payment of Rs. 81,000 as earnest money).
The petitioners alleged collusion between opponent Nos. 6 & 7 and the plaintiffs of RCS No. 740 of 1986 to defeat the petitioners' rights, pointing to pending proceedings under Section 20 of the Urban Land (Ceiling and Regulation) Act, 1976 (ULCRA).
They contended that even if not parties, they should be granted leave to appeal because they would be prejudicially affected and bound by the decree as res judicata.
Counsel for the petitioners argued that the Division Bench decision relied upon by the Court (reported 1979 GLR 801) was under challenge before the Supreme Court and thus this Court should stay or permit an appeal and then stay it until the Supreme Court disposes of that appeal.
They also relied on the proposition that payment of earnest money creates a charge under Section 55(vi)(b) of the Transfer of Property Act, 1882, and thus they are adversely affected.
The petitioners alleged fraud in obtaining the consent decree, referring to administrative orders rejecting mutation on grounds of contravention of the Prevention of Fragmentation and Consolidation of Holdings Act, 1947.

Respondents'/Opponents' Position (as reflected in the opinion)

The opponents (and the learned District Judge's findings) stressed that the petitioners did not take steps to intervene in RCS No. 740 of 1986 despite knowing of that suit (the agreement to sell itself shows knowledge).
The trial Court observed that proceedings under ULCRA were pending before the Government and that, if fraud or collusion existed, other remedies were available; refusal to grant leave was a proper exercise of discretion.
The respondents informed the Court that after the consent decree, an application to the competent authority to mutate the land in the names of opponent Nos. 1 to 5 (heirs of original donee) was submitted and granted — a fact relied on in answering the fraud allegation.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Ramji Mandir Narsinhji and Ors. v. Narsinh Nagar Alias Tekri Co-op. Housing Society Ltd. and Ors., 1979 GLR 801 (Division Bench)	The principle that a contract entered into on behalf of a non-existent co-operative society is a nullity and gives no cause of action; a society acquires capacity to contract only after registration (interpretation of Section 37 of the Gujarat Co-operative Societies Act and related rules).	The Court applied this binding Division Bench decision to hold that the petitioners' agreement to sell (executed in favour of members of a proposed/non-existent Vijay Co-op Society) is a nullity and creates no enforceable right in favour of the petitioners; therefore they are not "adversely affected" by the consent decree.
D.K. Trivedi and Sons and Ors. v. State of Gujarat and Anr., AIR 1986 SC 1323	Observation that where points identical to matters pending in the Supreme Court arise, a High Court should have stayed the hearing until the Supreme Court disposed of those matters (the Supreme Court criticized the High Court's course in that factual context).	The Court distinguished the facts of that Supreme Court observation from the present case and held it inapplicable; therefore it refused to stay the present revision or to grant leave to appeal pending a Supreme Court decision on the Division Bench rule relied upon by petitioners.
S. Vasudeva v. State of Karnataka and Ors. (Supreme Court decision, cited without full citation in the opinion)	Used in the opinion as a recent Supreme Court decision indicating that applications for exemption under Section 20 of the Urban Land (Ceiling and Regulation) Act are unlikely to be granted (as applied in the judgment).	The Court relied on this decision to underscore that the petitioners' agreement — which anticipated obtaining an exemption under ULCRA — was prima facie incapable of specific enforcement; this reinforced the conclusion that petitioners were not aggrieved by the consent decree.
Bai Hiragauri v. Abdul Kadar Mamadji and Anr.; Managing Director (MIG), Hindustan Aeronautics Ltd., Balanagar, Hyderabad v. Ajit Prasad Tarway; Delhi Municipality v. Suresh Chandra (Supreme Court rulings cited collectively)	Principles concerning the exercise of revisional jurisdiction and the limited circumstances in which appellate/revisional interference with discretionary orders (such as leave to appeal) is warranted.	The Court invoked these Supreme Court rulings to support the proposition that the District Judge’s discretion in refusing leave was exercised according to law and did not warrant interference under Section 115 CPC; consequently the revision was liable to be dismissed.

Court's Reasoning and Analysis

The Court's analysis proceeded in sequential legal steps grounded in fact findings and precedents cited in the opinion:

The Court began by reviewing the statutory framework for appeals: Section 96 CPC permits appeal only by a party adversely affected by a decree, though a non-party may appeal with leave of the appellate Court if prejudicially affected or bound (and Explanation 6 to Section 11 CPC was noted). Whether a non-party is "adversely affected" is a question of fact.
The petitioners' primary contention — that they were prejudicially affected by the consent decree because of rights under the agreement to sell dated July 1980 and by payment of Rs. 81,000 — was addressed first by examining the validity of that agreement.
Applying the Division Bench decision reported at 1979 GLR 801 (Ramji Mandir ...), the Court held that contracts made on behalf of a non-existent co-operative society are nullities because a co-operative society acquires contractual capacity only on registration (Section 37 of Gujarat Co-operative Societies Act and related rules). The agreement to sell in favour of the proposed Vijay Co-operative Society was therefore a nullity and created no enforceable right in favour of the petitioners.
From that legal conclusion it followed that (a) the agreement could not be specifically enforced in a competent court, and (b) if the agreement is void, no charge would attach to the property by virtue of it (answering the petitioners' reliance on Section 55(vi)(b) Transfer of Property Act). Consequently the petitioners were not "adversely affected" within the meaning of appellate provisions.
The Court considered the petitioners' submission that the Division Bench decision might be under challenge in the Supreme Court and relied on D.K. Trivedi to argue for a stay; the Court distinguished D.K. Trivedi on its facts and refused to treat the pendency of a Supreme Court appeal as depriving the Division Bench judgment of binding effect on this Court. The Court declined to stay the revision or to grant leave pending the Supreme Court outcome.
The Court examined the petitioners' contention about fraud/collusion in obtaining the consent decree. The petitioners pointed to administrative orders rejecting mutation on the ground that the gift deed contravened the Prevention of Fragmentation and Consolidation of Holdings Act, 1947. The Court noted that those administrative observations were not decisions by a competent authority declaring the gift deed void under that Act; moreover, after the consent decree the competent authority granted mutation in favour of opponent Nos. 1 to 5. On the record, the Court found no prima facie illegality or fraud shown that would vitiate the consent decree.
The Court also observed that the agreement to sell anticipated exemption under ULCRA (Section 20), and in view of the Supreme Court decision in S. Vasudeva the chance of such exemption being granted was slim; this reinforced the conclusion that the agreement was prima facie not specifically enforceable and the petitioners were not aggrieved by the consent decree.
The Court further noted discretionary considerations: the District Judge had considered relevant facts including the petitioners' failure to intervene in the earlier suit despite knowledge (as inferred from the agreement) and concluded it was not just or reasonable to grant leave. The Court found no illegality or arbitrariness in that exercise of discretion and thus no ground to interfere under Section 115 CPC.
The Court observed the practical consequence of granting leave even if an appeal succeeded: the best result would be revival of RCS No. 740 of 1986; it would not secure specific performance for the petitioners — they would need a separate suit for that relief. Given the petitioners had already instituted such a separate suit, the District Judge's direction to resort to alternate effective remedies was lawful.

Holding and Implications

Core Holding: The Civil Revision Application fails and the order of the District Judge refusing permission to the petitioners (non-parties) to file an appeal against the consent decree is upheld. In the words of the Court, the revision "fails" and the rule is discharged with no order as to costs.

Consequences and Practical Implications:

The petitioners are not found to be "adversely affected" by the consent decree because their asserted rights under the 1980 agreement were held to be nullities (agreement made on behalf of a non-existent co-operative society) and therefore unenforceable.
The petitioners' allegation of fraud or collusion in obtaining the consent decree was not established on the record; administrative observations about mutation were not treated as competent determinations rendering the gift deed void.
The District Judge's refusal to grant leave to appeal was a lawful exercise of discretion; this Court declined to interfere under Section 115 CPC and relied on applicable Supreme Court authority that discretionary orders should not lightly be disturbed.
Even if leave had been granted and an appeal succeeded, the immediate practical effect would only be revival of the underlying suit (RCS No. 740 of 1986); the petitioners would still need to pursue a separate suit for specific performance, which they have in fact already filed.
The Court did not create any new legal precedent; it applied existing binding authority (including the Division Bench decision reported 1979 GLR 801) and distinguished other authorities where factually appropriate.
Operational relief: the Court vacated interim relief previously granted and discharged the rule; however, it kept the operation and effect of the judgment in abeyance for a period of three months from the date of the judgment to enable the petitioners to approach the Supreme Court if they so wished.

Note: The summary is based exclusively on the content of the provided opinion and does not add information beyond that text.

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Jayantilal Hansraj Shah And Others v. Hemakuwarben Dolatraj Dave And Others

M. Panchal, J.

1. This Civil Revision Application which is instituted under Section 115 of the Code of Civil Procedure is directed against the order dated December 10, 1993 passed by the learned District Judge, Jamnagar below Exh. 1 in Civil Misc. Application No. 2 of 1993 by which the application submitted by the petitioners as 'Third Party' seeking leave to file an appeal against consent decree dated November 18, 1993 passed by the learned Civil Judge (S.D.), Jamnagar in Regular Civil Suit No. 740 of 1986, is rejected.

2. There is a plot of land admeasuring about 4 Acres 22 Gunthas forming part of Revenue Surevey No. 1488 situate within the limits of Jamnagar City. The said land was originally owned and possessed by Late Maharaja Shri Indravijaysinhji Dilawarsinhji Jadeja and others. Out of the said land, land admeasuring about one Acre was donated to one Dolatram Mulshanker Dave by gift deed dated November 16, 1963. After the death of Shri Indravijaysinhji, the opponent Nos. 6 and 7 herein became the owners of the said land as legal heirs of deceased Indravijaysinhji Jadeja. There was a dispute regarding legality of the gift deed dated November 16, 1963. The opponent Nos. 1 to 5 as heirs and legal representatives of Dolatram Mulshanker Dave instituted Regular Civil Suit No. 740 of 1986 in the Court of learned Civil Judge (S.D.), Jamnagar against the opponent Nos. 6 and 7 for declaration and injunction.

3. It is evident that Late Maharaja Shri Indravijaysinhji had executed an agreement to sell the land owned by him on July 10, 1980 in favour of the petitioners and the price fixed was Rs. 25/- per sq. ft. It is the case of the petitioners that the petitioners had paid an amount of Rs. 81,000/- by way of earnest money to the vendor at the time of execution of the agreement for sale.

4. In Regular Civil Suit No. 740 of 1986 the parties thereto submitted a compromise purshis Exh. 68 dated November 1, 1993. The learned Judge passed an order on November 3, 1993 to record the compromise. Thereafter on November 5, 1993, the original plaintiffs, i.e., opponent Nos. 1 to 5 herein submitted an application requesting the Court to pass a decree in terms of compromise. The learned Judge of the trial Court by an order dated November 6, 1993 gave direction to draw the decree in terms of the compromise and pursuant to that direction, the consent decree was drawn on November 18, 1993.

5. It is the case of the petitioners that they were not parties to Regular Civil Suit No. 740 of 1986 and the consent decree passed in the said suit adversely affects their rights and interest in the suit land. The petitioners have contended that initially the opponent Nos. 6 and 7 who were original defendants in Regular Civil Suit No. 740 of 1986 had contested the case and challenged the gift deed dated November 16, 1963, but thereafter the said opponents had conspired with the plaintiffs of Regular Civil Suit No. 740 of 1986 and had compromised the suit by submitting purshis Exh. 68 dated November 1, 1993. After pointing out that the proceedings under Section 20 of the Urban Land (Ceiling and Regulation) Act, 1976 are pending before the Government, the petitioners contended that with a view to defeating the rights of the petitioners, in collusion, consent decree has been obtained by the parties to Regular Civil Suit No. 740 of 1986. In the premises, the petitioners submitted Civil Misc. Application No. 2 of 1993 on November 25, 1993 before the District Court, Jamnagar seeking permission of the appellate Court to file an appeal against the consent decree dated November 18, 1993.

6. After hearing the learned Advocates for the parties, learned District Judge, Jamnagar came to the conclusion that though Regular Civil Suit No. 740 of 1986 was filed by the opponent No. 1 to 5 against the opponent Nos. 6 and 7 in the year 1986, the petitioners had not taken steps to intervene in the said proceedings. After noting that the proceedings are pending before the Government under the provisions of the Urban Land (Ceiling and Regulation) Act, 1976, learned Judge also came to the conclusion that if there is any fraud or collusion, the same can be challenged by resorting to other remedy, but it is not just, proper and reasonable to grant permission to the petitioners to prefer an appeal against decree based on compromise in Regular Civil Suit No. 740 of 1986. In view of the aforesaid conclusions, the learned Judge dismissed Civil Misc. Application No. 2 of 1993 which was filed by the petitioners seeking leave to file an appeal against consent decree dated November 18, 1986 passed in Regular Civil Suit No. 740 of 1986.

7. An appeal under Section 96 of the Civil Procedure Code may be preferred by any of the following persons:

(i) Any party to the suit adversely affected by the decree or if such party is dead by his legal representative.

(ii) Any transferee of the interest of such party so far as such interest is concerned, is bound by the decree. No person unless he is a party to the suit is entitled to appeal under this section. But, a person who is not a party to the suit may prefer an appeal with leave of the appellate Court and such leave should be granted if he would be prejudicially affected by the judgment and if it would be binding on him as res-judicata under Explanation 6 to Section 11 of the Code of Civil Procedure. A person who is not a party to the decree or order may with the leave of the Court prefer an appeal from such decree or order if he is either bound by the order or is aggrieved by it or is prejudicially affected by it. As a rule, leave to appeal will not be refused to a person who might have been made ex-nominee a party.

8. Whether a party is adversely affected by a decree is a question of fact to be determined in each case according to its particular circumstances.

9. The petitioners are claiming that the consent decree dated November 18, 1993 passed in Regular Civil Suit No. 740 of 1986 would adversely affect their rights created in their favour under the agreement for sale dated July 12, 1980 and, therefore, leave to appeal should have been granted to them. This claim has no substance. It may be noted that Late Maharaja Shri Indravijaysinhji Jadeja had executed an agreement to sell dated July 12, 1980 in favour of a non-existent cooperative society, i.e., proposed Vijay Co-operative Society Ltd. and its so-called members. The question as to what is the effect of a contract between the non-existent Co-op. Society and the other party came to be considered by the Division Bench of this Court in the case of Ramji Mandir Narsinhji and Ors. v. Narsinh Nagar Alias Tekri Co-op. Housing Society Ltd. and Ors. 1979 GLR 801. In the said case, an agreement of lease was entered into between a Trust on one hand and a non-existent Co-operative society on the other hand. After examining the scheme of Gujarat Cooperative Societies Act, 1961 in detail and relevant provisions of the Specific Reliefs Act, 1963, the Division Bench has held that a contract between a non-existent society on whose behalf someone purports to act, is a nullity and gives no rise to cause of action. It is ruled in the said case that in view of Section 37 of the Gujarat Cooperative Societies Act it is clear that a Co-operative Society becomes a legal person after it is registered and it is after its registration that it acquires the capacity to enter into contracts. On interpretation of the lauguage of Section 37 of the Gujarat Co-operative Societies Act, 1961 and Rule 3 of the Gujarat Co-operative Societies Rules, 1965, the Court held therein that agreement of lease entered into between the Trust on one hand and a non-existent Co-operative Society on the other hand was a nullity and gave no rise to cause of action for the society and, therefore, it could not be specifically enforced against the Trust.

10. In view of the above quoted binding decision of the Division Bench, I am of the view that the agreement for sale executed by Late Maharaja Shri Indravijaysinhji in favour of the petitioners who are members of the proposed Vijay Co-operative Housing Society is a nullity and creates no right in favour of the petitioners. As the agreement to sell dated July 10, 1980 is nullity, it cannot be specifically enforced and, therefore, even a suit for specific performance of the said agreement cannot be brought by the petitioners in a competent Court. In view of this legal position, it is evident that it cannot be said that the petitioners are adversely affected by consent decree dated November 18, 1993 passed in Regular Civil Suit No. 740 of 1986 so as to entitle them to get permission to file an appeal against the said decree.

11. The learned Counsel for the petitioners submitted that the decision rendered by the Division Bench which is reported in 1979 GLR 801 is subject-matter of challenge before the Supreme Court and, therefore, this Court should either stay the hearing of the revision application or grant the permission to the petitioners to file an appeal against the impugned consent decree and the hearing of the appeal should be stayed till the Supreme Court disposes of the appeal arising out of the judgment rendered by the Division Bench. In support of his submission, learned Counsel placed reliance on the following observations made by the Supreme Court in the case of D.K. Trivedi and Sons and Ors. v. State of Gujarat and Anr. AIR 1986 SC 1323:

Civil Appeal Nos. 1525 and 1526 of 1982 are directed against the order of the Gujarat High Court dismissing the writ petitions filed by the Appellants challenging the constitutionality of Section 15 of the Mines and Minerals (Regulation and Development) Act, 1957, and the validity of Notification No. GU 81/75/MCR 2181/(168) 4536-Chh dated June 18, 1981, and directing the Appellants to approach the Supreme Court as similar matters were pending there. In our opinion, the course adopted by the High Court was not correct. If the High Court thought that the point raised by the Appellants was the same as was pending in this Court, it ought to have stayed the hearing of the writ petitions until this Court disposed of the other matters. As we have, however, held Section 15 and the amendments made by the said Notification dated June 18, 1981, to be valid and constitutional, both these Appeals are, therefore, dismissed.

12. In my view, the aforesaid observations made by the Supreme Court will not apply to the facts of the present case. It may be noted that Civil Appeal No. 1525 of 1982 was directed against the order passed by the Division Bench of this Court in Special Civil Application No. 3000 of 1981, whereas Civil Appeal No. 1526 of 1982 was directed against the order passed by the Division Bench in Special Civil Application No. 3160 of 1981. Both the Special Civil Applications were summarily rejected at admission stage. In Special Civil Application No. 3000 of 1981 the following order was passed:

Leave to amend. As proceedings are pending before the Supreme Court regarding this connected dispute, it will be open to the petitioners to move the Supreme Court if they want. In this view of the matter, Special Civil Application is rejected at this stage. 4-8-1981 Whereas in Special Civil Application No. 3610 of 1991, the following order was passed:

As proceedings are pending before the Supreme Court regarding connected dispute, it will be open to the petitioners to move the Supreme Court. In this view of the matter, this Special Civil Application is rejected at this stage. 12-8-1981.

13. I am not confirming the order passed by the learned District Judge, refusing permission to the petitioners to file an appeal against the consent decree on the ground that the matter is pending before the Supreme Court nor I am directing the petitioners to approach the Supreme Court against the order passed by the Court in the present revision application. It hardly requires to be emphasised that the judgment of Division Bench is binding on this Court. I have no reason to take a different view of the matter. Merely because an appeal is pending before the Supreme Court, it cannot be said that the decision rendered by the Division Bench is no longer a good law or that it ceases to be a binding precedent. Having regard to the facts and circumstances of the case, I am of the view that it is not necessary for me to stay hearing of the present Revision Application or to grant permission to the petitioners to file an appeal against the impugned consent decree and then to stay the proceedings of the appeal till the disposal of the appeal by the Supreme Court against the judgment rendered by the Division Bench which is reported in 1979 GLR 801.

14. The submission that the petitioners had paid an amount of Rs. 81,000/-to Late Maharaja Shri Indravijaysinhji on the date of execution of agreement to sell dated July 12, 1980 and, therefore, as a charge is created on the property in view of the provisions of Section 55(vi)(b) of the Transfer of Property Act, 1882, it should be held that the petitioners are adversely affected by the decree in question, has also no substance. It is well settled that when the agreement for sale is invalid or void, no charge would attach to the property. As held by me earlier, the agreement to sell dated July 12, 1980 is a nullity and invalid and, therefore, no charge would attach to the property in favour of the petitioners. In this view of the matter, it cannot be said that the petitioners are persons who are adversely affected by the consent decree passed in Regular Civil Suit No. 740 of 1986.

15. From the averments made in the application seeking leave to appeal against the consent decree, it is evident that an application is submitted by the petitioners and the owners of the land under Section 20 of the Urban Land (Ceiling and Regulation) Act, 1976 seeking exemption from provisions of the said Act and that the said application is pending for consideration before the State Government. In view of the recent decision of the Supreme Court in the case of S. Vasudeva v. State of Karnataka and Ors. , there are hardly any chances of the application being granted. Once the said application is rejected, it will be difficult for the Court to decree the suit for specific performance of an agreement to sell because agreement to sell was executed in anticipation of exemption from the provisions of the Urban Land (Ceiling and Regulation) Act, 1976 which may be granted by the State Government under Section 20 of the said Act and this is quite apparent from Clause No. 13 of the agreement to sell dated 12-7-1980. It is also evident from the different Clauses of the agreement to sell that the land in question was not agreed to be purchased by the promoters of the proposed Vijay Co-operative Housing Society for their personal use. The intention is very clear that after obtaining exemption from the provisions of the Urban Land (Ceiling and Regulation) Act, 1976, the petitioners wanted to organise a Society and thereafter to sell plots with or without construction to the members of public at profit. In my view, the agreement to sell dated 12-7-1980 is such which prima facie cannot be specifically enforced more particularly after the decision of the Supreme Court in the case of S. Vasudeva (supra) and therefore, it cannot be said that the petitioners are in any manner aggrieved by or are prejudicially affected by the consent decree so as to entitle them to have leave to appeal against the consent decree.

16. The submission that a fraud was practised by the opponent Nos. 1 to 7 in obtaining the consent decree in Regular Civil Suit No. 740 of 1986 and, therefore, leave to file an appeal against the consent decree ought to have been granted by the District Court, has also no substance. The submission regarding fraud is based on the ground that the application made by the heirs of the donee to mutate the land in question in their names was rejected on the ground that the gift deed dated November 16, 1963 is in breach of the provisions of the Bombay Prevention of Fragmentation and Consolidation of Holdings Act, 1947. The two orders which have been produced on the record have been perused by me and it appears that the application submitted by the heirs of Late Maharaja Shri Indravijaysinhji and heirs of donee to mutate the land in question in the name of heirs of the donee was rejected on the ground that the deed dated November 16, 1963 would violate the provisions of the Prevention of Fragmentation and Consolidation of Holdings Act, 1947. It may be stated that no decision as on today has been rendered by any competent authority under the provisions of the Prevention of Fragmentation and Consolidation of Holdings Act, 1947 declaring that the gift deed is void because it violates the provisions of the Prevention of Fragmentation and Consolidation of Holdings Act, 1947. Some casual observations made by the Additional Mamlatdar, Jamnagar while rejecting the application to mutate the land in the name of the heirs of donee cannot be construed as an order passed by the competent authority under the provisions of the Prevention of Fragmentation and Consolidation to Holdings Act, 1947. The Court has been informed by the learned Counsel for the respondents that after passing of the consent decree by the trial Court, necessary application was submitted to the competent authority to mutate the land in the name of the opponent Nos. 1 to 5 who are heirs of original donee and the said application has been granted.

17. It may be mentioned that the gift deed executed by the Maharaja in favour of the original donee is earlier in point of time than the agreement to sell executed by late Maharaja in favour of the petitioners and the agreement to sell cannot be construed as defeating the rights of the heirs of original donee under the gift deed dated November 16. 1963. Having regard to the facts of the case, prima facie, no illegality appears to have been committed by the trial Court in passing the consent decree. Therefore, it cannot be said that any fraud was committed by the opponents in obtaining consent decree in Regular Civil Suit No. 740 of 1986. In my view, therefore, the petitioners are not entitled to permission to file an appeal against the consent decree on the ground that a fraud was practised by the opponents while obtaining decree in terms of compromise.

18. A person who is not a party to the action may be allowed to appeal if he is adversely affected by the order provided the appellate Court thinks fit in its discretion to grant such leave. The learned District Judge, after taking into consideration all relevant factors has refused to exercise discretion in favour of the petitioners and has not granted leave to them to appeal against the consent decree. Before refusing to exercise the discretion in favour of the petitioners, the learned Judge took into consideration the relevant fact that the petitioners did not take any steps to intervene in Regular Civil Suit No. 740 of 1986 which was filed by the opponent Nos. 1 to 5 against the opponent Nos. 6 and 7. The fact that the petitioners knew about the pendency of Regular Civil Suit No. 740 of 1986 is quite evident from Clause 4 of the agreement to sell dated 12-7-1980. The discretion exercised by the learned District Judge cannot be said to be arbitrary or illegal so as to call for interference of this Court while exercising powers under Section 115 of the Code of Civil Procedure. The learned Judge has jurisdiction either to grant leave or to refuse the leave to the petitioners to file an appeal against the consent decree. It cannot be said that the impugned order is passed by the learned Judge without jurisdiction or in excess of jurisdiction vested in him, by law. In view of the rulings of the Supreme Court rendered in the cases of (1) Bai Hiragauri v. Abdul Kadar Mamadji and Anr. Managing Director (MIG), Hindustan Aeronautics Ltd., Balanagar, Hyderabad v. Ajit Prasad Tarway and (3) Delhi Municipality v. Suresh Chandra , the present revision application filed under Section 115 of the Code of Civil Procedure is liable to be dismissed. The learned Judge has exercised discretion according to law. In my view, no ground is made out to interfere with the discretion exercised by the learned District Judge.

19. Ultimately, even if leave to appeal is granted and appeal is allowed, what would happen at the best would be that Regular Civil Suit No. 740 of 1986 would stand revived and nothing more than that. The petitioners cannot get specific performance of the agreement to sell in the said suit. For that relief, the petitioners will have to bring a separate suit against the opponents. In the circumstances, the direction given by the learned District Judge to the petitioners to resort to other effective alternative remedy cannot be said to be illegal. It may be mentioned that it was brought to the notice of the Court that the petitioners have filed a suit in competent Court against all the opponents challenging the consent decree passed in Regular Civil Suit No. 740 of 1986 and for specific performance of the agreement to sell dated 12-7-1980. The Court felt that the decision that may be rendered in this revision application would have direct effect on the suit instituted by the petitioners. The petitioners were, therefore, put to election either to withdraw the revision application and pursue the suit or to have judgment on merits in the revision application. The petitioners through their learned Counsel have informed the Court that the petitioners would like to have judgment on merits and in such circumstances, the present decision is rendered.

20. For the aforesaid reasons, the revision fails. Rule is discharged with no order as to costs. Ad-interim relief granted earlier is hereby vacated. At this stage, learned Counsel for the petitioners prays that the operation of the present judgment be stayed for a period of four months so as to enable the petitioners to approach the Supreme Court. In my view, interest of justice would be met if the operation of the judgment is kept in abeyance for a period of three months from to-day. It is, therefore, directed that the operation and effect of the judgment shall remain in abeyance for a period of three months from to-day.

Jayantilal Hansraj Shah And Others v. Hemakuwarben Dolatraj Dave And Others

Structured Summary of the Opinion (M. Panchal, J.)

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Petitioners' Arguments

Respondents'/Opponents' Position (as reflected in the opinion)

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Jayantilal Hansraj Shah And Others v. Hemakuwarben Dolatraj Dave And Others

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