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2025 Supreme(Del) 524

IN THE HIGH COURT OF DELHI AT NEW DELHI
PURUSHAINDRA KUMAR KAURAV, J.
 
Shri Sanjeev Kumar - Plaintiff
Versus
Shri Rajiv Malhotra and Ors. – Respondents
CS(OS) 109 of 2022, I.A. 4709 of 2023, I.A. 24809 of 2023, I.A. 42901 of 2024, CS(OS) 276 of 2024 and I.A. 7718 of 2024
Decided On : 21-08-2025
 

Advocates Appeared:
For the Plaintiff :Mr. S.K. Bhaduri, Ms.Shreyangana Bag, Ms. Rimpy Rohilla and Ms. Neetu Gupta, Advocates.
For the Respondents:Mr. Harkirat Singh, Advocate, Mr .Rahul Sharma, Mr. Rishab Kaushik, Mr. Mani Kant and Ms.Shikha Singh, Advocates.

In a suit for specific performance, claims for Court Fees are based on the consideration for the parts of the contract claimed, even if the agreement is unregistered.

Headnote:(A) Code of Civil Procedure, 1908 - Section 151, Order VII Rule 11 - Suit for specific performance - Application for dismissal filed under Section 151, instead of Order VII Rule 11 - Application dismissed as it can only be addressed under Order VII Rule 11 - Provisions of limitation not expired based on supplementary agreements. (Paras 8, 21, 26)

(B) Specific Relief Act, 1963 - Section 12(4) - Unregistered agreement to sell can be the subject of suit for specific performance - Court Fees must be calculated on the amount of consideration for the parts of the contract sought to be enforced. (Paras 16, 18, 24)

Facts of the case:
The plaintiff sought specific performance of a contract concerning shares in a property executed under an agreement to sell, followed by supplementary agreements; defendants argued for the dismissal due to improper valuation and limitation, asserting the agreement was unregistered.

Findings of Court:
The court held that the present suit cannot be dismissed at the preliminary stage as the issues raised require evidentiary adjudication. Dismissed the application, allowing all defenses to be raised at trial.

Issues: Whether the suit is maintainable under Order VII Rule 11 and the impact of limitation on the specific performance claim.

Ratio Decidendi: The court stated that the powers under Section 151 cannot replace express provisions under Order VII Rule 11, and specific performance can be sought even for unregistered agreements as governed by the Specific Relief Act.

Result: Application for dismissal of the suit dismissed.

Table of Content
1. maintainability of suit under cpc. (Para 1 , 2 , 3 , 4)
2. opposing arguments against application. (Para 5 , 6 , 8)
3. correct provisions for plaint dismissal. (Para 9 , 10 , 11)
4. court fees computation principles. (Para 12 , 13 , 15)
5. limitation period for specific performance. (Para 18 , 20 , 21)
6. unregistered agreements and their enforceability. (Para 22 , 24)
7. maintainability objections at trial stage. (Para 25 , 26)
8. concluding order on interim application. (Para 28 , 29)

JUDGEMENT :

PURUSHAINDRA KUMAR KAURAV, J.

I.A. 3028/2025 (by D-1 for dismissal of suit) in CS(OS) 276/2024

1. The applicant in the instant application prays for the following relief:-

“i) frame a preliminary issue regarding maintainability of the present Suit and decide the said preliminary issue in favour of Defendant No.1 in accordance with the submissions made in the present Application and dismiss the present Suit being not maintainable in the eyes of law, in the interest of justice.”

2. Heard learned counsel appearing on behalf of the parties.

3. Learned counsel for the applicant submits that the instant suit is not properly valued and that the plaintiff has no case to seek the reliefs prayed in the captioned suit. He submits that on various grounds as have been enumerated in the application, the instant suit deserves to be rejected.

4. According to him, the application has consciously been filed under Section 151 of Code of Civil Procedure, 1908 (CPC), so that the Court may,in exercise of its inherent powers, consider all the facts and circumstances relevant to the instant application and pass appropriate orders.

5. The aforesaid contentions are vehemently opposed by learned counsel for the plaintiff.

6. Learned counsel appearing for the plaintiff submits that applications seeking rejection of plaint may not be filed under Section 151 of the CPC in view of the express provision for the same under Order VII Rule 11. He further submits that allowing the present application would amount to expansion of the scope of the Court’s power to reject the plaint, by taking into consideration, material, other than the averments in the plaint and the documents relied thereon. He contends that, therefore, the instant application is meritless and deserves to be dismissed.

7. I have considered the submissions made by learned counsel appearing on behalf of the parties and also perused the record.

8. The instant application for dismissal of the suit has been filed under Section 151 of the CPC, and the principal grounds urged herein, are (i) improper valuation of the suit and insufficiency of the Court Fees paid thereon. (ii) the suit being barred by limitation, and (iii) that the agreement which is sought to be specifically enforced being unregistered, cannot be specifically enforced.

9. The CPC contains express provisions for rejection of plaints, under Order VII Rule 11. It is settled law that the inherent powers of the Court cannot be exercised in respect matters for which express provision has beenmade under the CPC. The grounds raised in the instant application by the defendant for dismissal of the suit are covered under Order VII Rule 11(b) and (d).

10. It is also settled law that the Court may appreciate applications filed under incorrect provisions, as having been filed under the correct applicable provision. Therefore, the present application is to be considered under Order VII Rule 11 of the CPC.

11. The scope of inquiry for rejection of the civil suit as envisaged under the provisions of Order VII Rule 11 of the CPC, has been well settled by the Supreme Court. Reference can be made to the decision in the case of Dahiben v. Arvindbhai Kalyanji Bhanusali (Gajra) (D) Thr Lrs & Ors., 2020 INSC 450. The relevant portion of the said decision is extracted below, for reference:

“12.2. The power conferred on the court to terminate a civil action is, however, a drastic one, and the conditions enumerated in Order VII Rule 11 are required to be strictly ad

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