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2015 Supreme(Del) 749

High Court of Delhi
INDERMEET KAUR, J.

R.S. Chhabra – Appellant
Versus
Gopal Krishan Kapoor & Others – Respondents
I.A. Nos. 2286 of 2010, 1460, 5310 of 2014 in CS (OS) No. 353 of 2006 & EX.P. No. 232 of 2007 & EX. Appl. (OS) No. 35 of 2010
Decided On : 06-05-2015

Advocate Appeared:
For the Plaintiff:Sandeep Sethi, Senior Advocate with Chaman Lal Sachdeva, Preet Pal Singh, Priyam Mehta, Advocates
For the Defendants:Pritesh Kapoor, Radhika Sharma, Bina Gupta, Advocates

Headnote:

Civil Procedure Code, 1908 - Order 23 Rule 3 - Contract Act, 1872 - Section 18 - Specific Relief Act, 1963 - Section 28 - Consent decree - Mis-representation and fraud - Not proved - Consent decree was obtained under a mis-representation and fraud - Assignment claimed was not a valid assignment by defendant No. 6 in favour of the plaintiff - What is the mis-representation in the assignment deed has not been disclosed - There is no detail of either the mis-representation or fraud - It is a simplicitor statement unsupported by any further detail; except a vague averment that this document dated 20.04.2005 was only an agreement to assign and not a completed deed of assignment - Assignment deed is a registered document - Appellant has been ready and willing to perform her part of contract at all stages - She has not taken any advantage of her own wrong - The appellant is in no way responsible for the delay at any stage of the proceeding. It is the respondents who have always been and are trying to wriggle out of the contract. The respondents cannot take advantage of their own wrong and then plead that the grant of decree of specific performance would amount to an unfair advantage to the appellant.

Civil Procedure Code, 1908 - Order 23 Rule 3 - Consent decree - Obtained under a mis-representation - Scope of - Plea of fraud/mis-representation - This plea at all stages had been rejected - Application is time barred - Limitation for an application of such a nature is three years which period has to be counted from the date when the knowledge of the fraud/mis-representation was known to the party - Applicants learnt about the fraud/mis representation qua the assignment deed when defendant No. 6 filed an application on 18.05.2006 - Application filed in December, 2010 - It is beyond the period of limitation - Application is dismissed.

Specific Relief Act, 1963 - Section 28 - Breach of obligation - Denial of execution of deed - Scope of - Breaches were all committed by the defendants - Defendants were not cooperating - Local Commissioner had been appointed - Local Commissioner in its various reports had detailed the non- cooperative attitude of the defendants - Defendants being asked to appear before the office of L & DO to get the conveyance deed executed, they failed to do so - Obligation on the part of the plaintiff to pay the balance consideration of Rs. 4.17 crores within 15 days would have arisen only after the execution of the conveyance deed - All faults lay on the part of the defendants - Obligation on the part of the plaintiff to pay the balance amount had not arisen as the conveyance deed was not executed in favour of the defendants - This was all for the fault on the part of the defendant - Defendants are not entitled to any relief - Application is dismissed.

JUDGMENT :

1. These are three applications filed by the judgment debtor.

I.A. No. 2286/2010 (under Order XXIII Rule 3 of the Code)

2. This is an application filed by the judgment debtor under Order XXIII Rule 3 of the Civil Procedure Code, 1908 (hereinafter referred to as the ‘Code’); reliance has been placed upon the proviso; submission being that the consent decree passed by the Court on 20.03.2006 in CS (OS) No. 353/2006 was obtained under a mis-representation and fraud; submission of the plaintiff (R.S. Chhabra) in those pleadings that he was a valid assignee of Rajesh Kumar (defendant No. 6 in that suit) was a false and fraudulent averment; there was no valid assignment by defendant No. 6 in favour of the plaintiff. In the instant case, the deed of assignment dated 20.04.2005 was only an agreement which was yet to be followed up by another document and not being a complete deed of assignment and the whole case of the plaintiff being premised on this document and this being fully known to the plaintiff, he is guilty of mis-representation within the meaning of Section 18 of the Indian Contract Act. The consent decree passed on 20.03.2006 premised on this assignment deed suffering from a mis-representation is a voidable contract and the defendant accordingly seeks setting aside of this decree. His second submission on the agreement dated 20.04.2005 is based on the averments that a person holding a back to back agreement to sell with the original proposed buyer would not be entitled to sue on the first agreement in the absence of a valid and a complete assignment in his favour. There being no complete assignment in favour of the plaintiff, the present suit was not maintainable. On this ground also, the decree dated 20.03.2006 is liable to be set aside. This fact was learnt by the judgment debtors only when defendant No. 6 filed an application before the Division Bench seeking setting aside of the consent decree dated 20.03.2006. Submission being that the dispute between the parties had in fact traveled right up to the Supreme Court and the Apex Court vide its order dated 20.11.2009 had granted liberty to the present applicant/judgment debtor to move an appropriate application under Order XXIII Rule 3 of the Code pursuant to which this present application has been filed. Learned counsel for the applicant has placed reliance upon an extract from the text of “Chitty on Contracts” as also “Halsbury’s Laws of England” to argue as to what is a ‘mis-representation’. Submission being that a statement of fact, past or present, which is unfounded and which is known to the plaintiff to be a wrong is a ‘mis-representation’. Reliance has also been placed upon the judgment of the Apex Court in (1968) 2 SCR 797 Ningawwa Vs. Byrappa Shiddappa Hireknrabar and Others to support this submission. Submission being that where a contract is based on fraud or mis-representation, it is voidable.

3. Reply has been filed opposing the application. It is pointed out that the decree dated 20.03.2006 has attained a finality and as per the version of the applicant/judgment debtor while dismissing the SLP on 20.11.2009, the Supreme Court had refrained from interfering with the orders of the Court below which included the consent decree dated 20.03.2006. Submission being that the application is even otherwise barred by law of limitation; under Article 137 of Schedule I of the Limitation Act, an application seeking setting aside of the decree which is based either on fraud or mis-representation has to be filed within a period of three years which period has to be counted from the date of knowledge of this fraud or mis-representation. Even as per the case of the applicant, he learnt about this fraud or mis-representation when defendant No. 6 filed an application before the Division Bench on 18.05.2006. The present application filed in December, 2010 is barred by limitation. Attention has been drawn to the memorandum of understanding dated 28.02.2005 executed betwee




























































































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