Point of Law: Civil Suit - Rejection of Plaint - A plaint as a whole can be rejected against some of defendants in terms of Order VII Rule 11 of the Code.

JUDGMENT :

S.J. KATHAWALLA & VINAY JOSHI, JJ.

1. ADMIT. Heard finally with the consent of the Learned Counsels appearing for the respective parties.

2. The Appellants who are Plaintiffs in the Suit, have challenged the legality of the Order dated 14.01.2019 passed in Notice of Motion No. 2515/16 filed in Suit No. 187 of 1993 (“Impugned Order”), whereby the Learned Single Judge allowed the Notice of Motion, thereby rejecting the plaint against Defendant Nos. 4 to 6 for want of a cause of action under Order VII Rule 11(a) of the Code of Civil Procedure (“Code”).

For the sake of convenience, the Parties shall hereinafter be referred to as per their original status in the Suit i.e. the Appellants will be referred to as the Plaintiffs, Respondent Nos. 1 to 3 will be referred to as Defendant Nos. 1 to 3 and Respondent Nos. 4 to 6 will be referred to as Defendant Nos. 4 to 6.

3. The facts in brief are :

3.1. Defendant No.1 - M/s S.K. Trading Company, was a Partnership Firm in which Defendant Nos. 2 and 3 were Partners. Defendant No. 1 owns a property admeasuring 1714 square yards which is described at Exhibit A annexed to the plaint (“Suit Property”). Defendant Nos. 1 to 3 agreed to sell the Suit Property to the Plaintiffs for a consideration of Rs. 43,00,000/-, pursuant to which an Agreement to Sell was executed on 07.12.1985 (“Agreement to Sell”).

3.2. Defendant No. 4 - M/s Suniti Prints, was a Partnership Firm of which Defendant Nos. 5 and 6 were Partners. The Suit Property was occupied by several tenants. Defendant No. 4 was one of the tenants in occupation of approximately 500 square yards of the Suit Property. Defendant Nos. 5 and 6 were closely related to Defendant Nos. 2 and 3.

3.3. Under the Agreement to Sell, the mode of payment of consideration was fixed between the parties thereto. One of the conditions was that the Plaintiffs (Purchasers) were to initially pay a sum of Rs. 8,00,000/- directly to the tenant of Defendant No.1 i.e. to Defendant No. 4, for acquiring alternate accommodation.

3.4. It is the Plaintiffs’ case that, the Vendors (Defendant Nos. 1 to 3) had contracted with their tenant/Defendant No. 4, to vacate the tenanted premises in exchange for a lump-sum payment of Rs.28,00,000/-. It was agreed at the request of Defendant Nos. 1 to 3, that this amount of Rs.28,00,000/- shall be paid directly by the Plaintiffs to Defendant No.4. Out of this amount, Rs.8,00,000/- was to be paid in advance to Defendant No. 4 and the balance amount was to be paid at the time of handing over peaceful possession. The remaining consideration was to be paid to the owners i.e. to Defendant Nos. 1 to 3.

3.5. The Plaintiffs have paid partial consideration of Rs.6,15,000/- to the Vendors (Defendant Nos. 1 to 3) and at the request of the Vendors, Rs.13,10,000/- directly to Defendant No. 4 (tenant).

3.6. It is contended that the Plaintiffs were ready and willing to pay the balance consideration, however, the Vendors refused to perform their part of the contract. Particularly, the Vendors refused to state as to when Defendant No.4 (tenant) would be in a position to vacate part of the Suit Property. Finally, the Plaintiffs issued a legal notice calling upon the Vendors to perform their obligation by accepting part consideration, however, to no avail.

3.7. The Plaintiffs therefore filed the above Suit before this Court seeking specific performance of the Agreement to Sell dated 07.12.1985 and in the alternative, for refund of the earnest amount and for damages. The reliefs sought in the Suit are reproduced hereunder :

“(a) That this Hon’ble Court be pleased to declare that the Agreement dated 7th December, 1985, (Exhibit B to the Plaint) is a valid, subsisting and binding agreement between the plaintiff and the 1st Defendant including the 4th Defendants;

(b) That the Defendants be ordered and decreed to specifically perform the Agreement dated 7th Dece