Rejection of plaint under O VII R 11 CPC permits fresh suit via R 13; partnership firm acquires cause of action for specific performance if contract rights contributed as capital with firm funds; limitation under Art 54 triable mixed issue.

JUDGMENT:

N.J.JAMADAR, J.

1. Rule. Rule made returnable forthwith, and with the consent of learned Counsel for the parties, heard finally.

2. By this petition under Article 227 of the Constitution of India, the Petitioner – original Defendant No. 2 takes exception to an order dated 25^th June, 2025 passed by the learned District Judge, Bhiwandi on an application (Exh. 23) in Commercial Suit No. 02/2024, whereby the said application preferred by the petitioner for rejection of the plaint under the provisions of Order VII Rule 11(a) and (d) of the Code of Civil Procedure, 1908 (‘the Code’), came to be rejected.

3. The background facts leading to this petition can be summarized as under:-

3.1 M/s. Maharashtra Wood Based Industrial Estate (R-1) is a registered partnership firm. Binani Industries Ltd. (R-2) – original Defendant No. 1 is a company incorporated under the Companies Act, 1956. Afamado Advisory – the petitioner (original Defendant No. 2), the Respondent No. 1 claims, is a sister company of Binani Industries (D-1). (For the sake of convenience and clarity, the parties are hereinafter referred to in the capacity in which they are arrayed before the Commercial Court in Suit No. 02/2024.)

3.2 Before M/s. Maharashtra Wood Based Industrial Estate/the plaintiff came to be registered as a partnership firm, it was a proprietary concern and Prabhudas Patel was engaged in the business as a sole proprietor thereof. On 01^st February, 2019, Hiren Patel, the son of Pradbhudas Patel, joined Prabhudas Patel to form the plaintiff - firm.

3.3 The plaintiff asserts, the Defendant No. 1 agreed to sell a large tract of land situated at Khanivali and Ambiste, Tq. Wada admeasuring 23H 8R to the plaintiff for a consideration of Rs. 14,25,00,000/-. Pursuant to the said agreement, on 03^rd January, 2019, a sum of Rs. 21,00,000/- (Rupees Twenty One Lakhs) was credited to the account of Defendant No. 1 towards part consideration. A receipt was passed by the Defendant No. 1 on 03^rd January, 2019.

3.4 Subsequently, on 21^st January, 2019, a Memorandum of Understanding came to be executed by and between the Defendant No. 1 and Prabhudas Patel on behalf of the then proprietorship concern.

3.5 In pursuance of the said contract, evidenced by MoU, the plaintiff took various steps and parted with consideration of Rs. 59,40,000/- (Rupees Fifty Nine Lakhs Forty Thousand) over a period of time. No objection of the state level committee for the establishment of the proposed Wood Based Industrial Estate was obtained. The Defendant No. 1 also obtained permission to put the subject land to non-agricultural use. A draft deed of conveyance was submitted for adjudication of the stamp duty.

3.6 The Defendant No. 1 thereafter resiled from its obligations under the said contract. Instead, the Defendant No. 1, during the subsistence of the said contract, between the plaintiff and Defendant No. 1, executed a conveyance in favour of Defendant No. 2, on 31^st March, 2021 and got it registered on 11^th May, 2021. Thus, the Plaintiff No. 1 had initiated various measures including institution of the Special Civil Suit No. 265/2021 seeking specific performance of the contract contained in the MoU dated 21^st January, 2019.

3.6 In the said suit, the Defendant No. 1 had moved an application for rejection of the plaint. By an order dated 22^nd February, 2024, the learned Civil Judge, Bhiwandi rejected the