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2022 Supreme(Cal) 356

IN THE HIGH COURT OF CALCUTTA
Tapabrata Chakraborty, Raja Basu Chowdhury, JJ.
L.M. Techno-build Private Limited - Appellant
Versus
Pranati Ghosh And Others - Respondent
FA 154 of 2022 with IA No. : CAN 1 of 2020
Decided On : 07-09-2022

Advocates appeared:
Mr. Amales Ray, Ms. Mousumi Bhowal, Mr. Aman Gupta, Mr. Somraj Paul, Mr. Ishan Bhattacharya., for the Appellant; Mr. Saptansu Basu, Sr. Adv., Mr. Aninda Bhattacharya., for the Respondent

The main legal point established in the judgment is that the power under Order VII Rule 11 of CPC should be exercised based on the statements made in the plaint itself and documents appended thereto, and a suit cannot be dismissed on the ground of insufficiency of stamp duty, especially under the provisions of Order VII Rule 11 of CPC.

Headnote:

CPC - Rejection of Plaint - Order VII Rule 11 - Companies Act, 1956 - Stamp Act, 1899 - [SPECIFIC PERFORMANCE OF AGREEMENT FOR SALE] - [CPC Order VII Rule 11, Companies Act 1956, Stamp Act 1899] - The court discussed the rejection of the plaint under Order VII Rule 11 of CPC, based on the insufficiency of stamp duty on the agreement for sale dated 6th November, 2012. The court emphasized that the power under Order VII Rule 11 should be exercised based on the statements made in the plaint itself and documents appended thereto. The court also highlighted the obligation of the court to dismiss a plaint by exercising powers under Order VII Rule 11 only after a meaningful reading of the entire plaint and not otherwise. The court further emphasized that a document forming the basis of the plaint, when produced along with the plaint, can be taken into consideration for rejection of plaint under Order VII Rule 11 of CPC. The court also clarified that a suit cannot be dismissed on the ground of insufficiency of stamp duty, especially under the provisions of Order VII Rule 11 of CPC.

Fact of the Case:

The plaintiff, a company incorporated under the Companies Act, 1956, filed a suit for specific performance of an agreement for sale dated 6th November, 2012 and injunction. The suit was dismissed by the learned judge under Order VII Rule 11 of CPC, primarily based on the insufficiency of stamp duty on the agreement for sale.

Finding of the Court:

The court found that the rejection of the plaint under Order VII Rule 11 of CPC was not justified as the insufficiency of stamp duty on the agreement for sale could only be considered once the document is tendered in evidence. The court set aside the order and restored the suit to its original file and number.

Issues: The issues revolved around the rejection of the plaint under Order VII Rule 11 of CPC, the sufficiency of stamp duty on the agreement for sale, and the obligation of the court to dismiss a plaint by exercising powers under Order VII Rule 11 based on a meaningful reading of the entire plaint and documents appended thereto.

Ratio Decidendi: The court emphasized that the power under Order VII Rule 11 should be exercised based on the statements made in the plaint itself and documents appended thereto. The court also highlighted the obligation of the court to dismiss a plaint by exercising powers under Order VII Rule 11 only after a meaningful reading of the entire plaint and not otherwise. The court further emphasized that a document forming the basis of the plaint, when produced along with the plaint, can be taken into consideration for rejection of plaint under Order VII Rule 11 of CPC.

Final Decision: The court set aside the order and restored the suit to its original file and number, emphasizing that a suit cannot be dismissed on the ground of insufficiency of stamp duty, especially under the provisions of Order VII Rule 11 of CPC.

JUDGMENT

Raja Basu Chowdhury, J. This appeal has been filed challenging the judgment dated 12 th February, 2020 passed by the Civil Judge, (Senior Division), Islampur, Uttar Dinajpur in Title Suit No. 16/2015. By the aforesaid judgment, the learned judge has dismissed the suit by invoking its power under Order VII Rule 11 (d) of the Code of Civil Procedure, 1908 (in short, CPC). In connection with the aforesaid appeal an injunction application being CAN No. 1 of 2020 has also been filed. When the aforesaid injunction application came up for hearing, by consent of the parties, we had proceeded to hear out the appeal as also the application for injunction.

2. The brief facts of the case are that the plaintiff which is company incorporated under the provisions of Companies Act, 1956 has filed a suit inter alia claiming a decree for specific performance of an agreement for sale dated 6th November, 2012 and injunction.

3. The plaintiff claims the defendant nos. 1 to 6 to be absolute owners of the suit property. The defendant nos. 7 and 8 had acted as felicitators in connection with sale of the suit property comprising of 33 kathas of bastu land lying and situated at Mouza Islampur, District North Dinajpur, more particularly described in the schedule of the plaint. The plaintiff had inspected the suit property and had thereafter agreed to purchase the same for and at a consideration of Rs. 70,00,000/-, on the terms more fully appearing in the agreement for sale executed on 6th November 2012. The plaintiff claims to have paid Rs. 60,00,000/- to the defendant nos. 1 to 6 as per particulars given in the plaint. The plaintiff has also pleaded its readiness and willingness to comply with the terms of agreement for sale. Since the defendants have not come forward to execute the conveyance despite request, the balance consideration Rs. 10,00,000/- remains unpaid. The plaintiff is willing to make payment of the said sum. The aforesaid suit has been filed sometimes in the year 2015.

4. The defendant nos. 1 and 3 to 6 have jointly filed a written statement.

5. Records reveal, that on 12th July, 2019 the defendant nos. 1 to 6 jointly filed an application under Order VII Rule 11(d) of CPC, inter alia, claiming in paragraph 4 and 5 thereof that the director of the plaintiff without any board resolution had filed suit and that the said defendants had been able to ascertain from authentic source that the plaintiff company is no more in existence and as such is a non-existing juristic body who cannot proceed with the suit. Directors of the plaintiff company lose their identity and becomes a non-existing company, hence the application for dismissal of the suit. The said application was contested by the plaintiff by filing written objection. By judgment and order dated 12th February, 2020 which partakes the character of a deemed decree the aforesaid suit has been dismissed by holding inter alia that the suit is primarily based on an agreement for sale, the same being insufficiently stamped cannot be considered unless it is properly impounded as per Stamp Act, 1899, and as such is barred by law.

The learned Court by concluding that the plaintiff had no locus to continue with the suit, the suit being barred by law rejected the plaint by allowing the application under Order VII Rule 11 of CPC.

6. Mr. Roy learned advocate, appearing in support of the instant appeal impugns the above judgment on several grounds. He submits that while hearing an application under Order VII Rule 11 of CPC, the Court is concerned only with the statements made in the plaint. If from the statements made in the plaint it does not appear that the suit is barred, the plaint cannot be rejected. The instant suit was instituted in the year 2015.

The defendant nos. 1 and 3 to 6 are contesting the suit by filing a joint written statement. No case as regards non-existence of the plaintiff company has been made out in the written statement. In absence of pleadings no issue could have been frame

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