V.K. Jain, J.

IA No. 9657/2008 (under Order 7 Rule 11 of CPC)

1. This is an application for rejection of plaint on the ground that it does not disclose any cause of action.

2. This is a suit for specific performance of an agreement dated 23rd December, 2005, executed by the defendants, in favour of the plaintiffs, for sale of their undivided share in plot No. 15, Block No. 172, Jor Bagh, New Delhi. It is alleged in the plaint that vide agreement dated 23rd December, 2005, the defendants agreed to sell their undivided one-third share in the aforesaid property to the plaintiff for a total sale consideration of Rs. 3,87,50,000/-. It is alleged that the plaintiff issued a cheque of Rs. 21 lacs to the defendants, which was later replaced by a cheque of Rs. 25 lacs. Initially, the date for making final payment was fixed as 09th January, 2006, but later defendant No. 1, acting for himself as well as on behalf of defendant Nos. 2 to 4, agreed to extend the date and also received a sum of Rs. 25 lacs from the plaintiff. It is also alleged that despite receiving Rs. 25 lacs from the plaintiff, the defendants have been delaying fulfillment of their contractual obligations and have not come forward to complete the transactions. The plaintiff also claims to have sent one letter dated 02nd August, 2006 and another letter dated 07th May, 2007 to the defendants, asking them to do the needful in this regard. This was followed by yet another letter dated 04th April, 2008.

3. In the application under consideration, the defendants have alleged that since the Memorandum of Understanding (MoU) dated 23rd December, 2005, contemplated execution of a proper agreement by 10th January, 2006 and no such proper agreement was executed between the parties, the suit is liable to be dismissed. It is further alleged that the plaintiff himself committed breach of the MoU dated 23rd December, 2005 and abandoned the same. It is also alleged that the receipt dated 23rd February, 2006 and the letter dated 09th January, 2006, extending the MoU are forged and fabricated documents. It is also stated in the reply that the cheque dated 23rd December, 2005, issued by the plaintiff for Rs. 11 lacs, was dishonoured when presented to the bank and the schedule of payment stipulated in the MoU dated 23rd December, 2005, was never adhered to by the plaintiff. It has, however, been admitted that the plaintiff made two payments to the defendants; one for Rs. 21 lacs by demand draft and other of Rs. 14 lacs vide cheque dated 23rd February, 2006. It is also claimed that the sale consideration was agreed at Rs. 3,87,50,000/- and the earnest money on the aforesaid amount came to Rs. 38,70,000/-, which was never paid by the plaintiff.

4. The legal proposition in the matter is well- settled. The Court while considering an application for rejection of the plaint can look into only the averments made in the plaint and the documents filed by the plaintiff. The defence taken by the defendant is not to be considered while examining such an application and validity of the documents filed by the plaintiff also cannot be examined at this stage.

5. A Division Bench of this Court in Inspiration Clothes & U v. Colby International Ltd., 88 (2000) DLT 769, held that the power to reject the plaint can be exercised only if the Court comes to the conclusion that even if all the allegations are taken to be proved, the plaintiff would not be entitled to any relief whatsoever. It was also observed that where the plaint is based on a document, the Court will be entitled to consider the said document also to ascertain if a cause of action is disclosed in the plaint or not though the validity of the document cannot be considered at this stage. In Avtar Singh Narula & Anr. v. Dharambir Sahni & Anr., 150 (2008) DLT 760 (DB), this Court reiterated that the power to reject the plaint has to be exercised sparingly and cautiously though it does have the power to reject the plaint in a proper case. In Popat and Kotecha