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IN THE HIGH COURT OF JAMMU AND KASHMIR AND LADAKH AT JAMMU
Rahul Bharti, J.
Madan Mohan Bhargav – Petitioner
Versus
Canara Bank and Others – Respondents
RFA No. 5 of 2023
Decided On : 13-02-2023
Dormant potentiality of Order VII rule 11 of the Code of Civil Procedure, 1908 - Civil Suit - Code of Civil Procedure, 1908 - Sections 2(2), 26, 34 - The court discussed the interpretation and application of Order VII Rule 11 of the CPC, the definition of 'Decree' under Section 2(2) of the CPC, and the jurisdiction of civil courts in relation to matters under the SARFAESI Act. The court highlighted the importance of cause of action in a civil suit, the joinder of causes of action, and the rejection of plaint under Order VII Rule 11 CPC. The judgment also referenced the legal provisions of Section 34 of the SARFAESI Act and the implications of the appellant's claims on the bank's security interest.
Fact of the Case:
The appellant filed a Civil 1st Appeal against the dismissal of a suit by the trial court, which was based on the grounds of non-maintainability under the SARFAESI Act. The suit sought declaration and injunction against the bank's proceedings under the SARFAESI Act and challenged a money decree obtained by the bank. The appellant claimed to have purchased a mortgaged property and alleged fraud by the bank.
Finding of the Court:
The trial court held that the civil court had no jurisdiction to entertain the suit in view of the bar created by the SARFAESI Act. The court rejected the appellant's plea of fraud and found the suit to be non-maintainable. The High Court affirmed the trial court's decision, emphasizing the appellant's lack of right to sue regarding the money decree and the bar on civil court intervention in SARFAESI Act matters.
Issues: The issues revolved around the jurisdiction of the civil court in matters related to the SARFAESI Act, the maintainability of the appellant's suit, and the validity of the money decree obtained by the bank.
Ratio Decidendi: The court's decision was based on the interpretation of the SARFAESI Act, the definition of 'Decree' under the CPC, and the principles of cause of action and joinder of causes of action. The court emphasized the bar on civil court intervention in SARFAESI Act matters and the appellant's lack of right to challenge the money decree.
Final Decision: The civil first appeal was held to be meritless and was dismissed by the court.
JUDGMENT :
Rahul Bharti, J.
1. Heard learned counsel for the appellant and also respondent no. 1.
2. Dormant potentiality of Order VII rule 11 of the Code of Civil Procedure, 1908 was given a kinetic impetus and interpretation by the Hon'ble Supreme Court in its judgment in case of T. Arivandandam vs. T.V. Satyapal, 1977 AIR SC 2421 by imploring the civil courts handling the civil suits to apply a diagnostic examination of a plaint at first blush so as to check its fitness for onward march of trial so that in case a plaint, in its true hue, is found to be bearing just a disguise of a cause of action then to deliver it a rejection.
3. The Court of learned 1st Additional District Judge, Jammu reminded itself of said potentially of Order VII Rule 11(d) CPC by not falling to trap of an illusion of cause of action set up in his plaint to order its rejection which has brought the appellant in present civil first appeal under section 96 CPC and this court is also dealing with same skill to deal with the appeal at its very inception so as to show it its resting place.
4. This is a Civil 1st Appeal against a judgment and decree dated 04.02.2023 passed by the trial court of learned 1st Additional District Judge, Jammu in civil suit on File No. 185/COS thereby dismissing the suit filed on 23.01.2023 by the appellant. The suit has been dismissed by operating Order VII Rule 11(d) of the Code of Civil Procedure, 1908 (in short CPC) on the ground of non-maintainability in view of the bar created under the provisions of “Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002” (“SARFAESI Act” in short).
5. The factual background bearing which the appellant came forward to institute the aforementioned civil suit is by reference to a money decree dated 28.09.2017 passed by the Court of learned Additional District Judge (Bank Cases) Jammu in favour of the respondent no. 1, herein the Canara Bank.
6. The respondent no. 1-Canara Bank had advanced a loan facility of rupee fourteen (14) lacs in 1984 in favour of one Kewal Krishan Kohli son of Jagdish Raj Kohli. For this loan facility, the loanee Kewal Krishan Kohli had mortgaged his ownership house premises of 20 B/C Gandhi Nagar, Jammu in favour of the respondent no. 1-Canara Bank by virtue of a mortgage deed dated 14.02.1984 and had also furnished a guarantor, namely, Shanti Devi Kohli.
7. Upon the failure of said Kewal Krishan Kohli to repay the loan liability, the respondent no. 1-Canara Bank had filed a civil suit on File No. 308/Civil on 28.10.1991 before the Court of learned Additional District Judge (Bank cases), Jammu asking for money decree of Rs. 51,95,633/- along with interest pendente lite. In this suit, the principal borrower Kewal Krishan Kohli and his guarantor Shanti Devi Kohli had caused appearance to file written statement on 19.09.1997 and also to be examined on 10.07.1999 as well under Order X CPC requirement.
8. While the aforesaid suit of recovery was so pending, the appellant herein had emerged on his own, acting through an attorney holder Gheetan Singh, to seek impleadment as co-defendant in the suit with an application filed on 30.04.2007 saying that by virtue of an agreement to sell dated 30.03.2000. The appellant had come to pay a sale price to Kewal Krishan Kohli for sale of his house Property No. 20 B/C Gandhi Nagar, Jammu. This application had got dismissed on 05.10.2007 by the trial court of Additional District Judge (Bank cases) Jammu.
9. Thereafter, the appellant again stepped forward for his impleadment as defendant in the suit with an application filed on 07.11.2007 this time putting up a sale deed dated 30.07.2001 quo House No. 20 B/C Gandhi Nagar, Jammu in terms whereof the appellant claimed to have purchased the house property of 20 B/C Gandhi Nagar, Jammu from said Kewal Krishan Kohli. This application too came to be dismissed by the trial court of Additional District Judge (Bank cases) Jammu vide an order dated 15.12.2007. A
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