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2022 Supreme(Online)(Bom) 2342

HIGH COURT OF BOMBAY
R.I. Chagla, J
Ramesh Mali – Appellant
Versus
M/s Samrat Associates & Ors. – Respondent
Interim Application (L) No. 2566 of 2022 in Suit (L) No. 29721 of 2021 | Interim Application (L) No. 3696 of 2022 in Suit (L) No. 29721 of 2021 | Interim Application (L) No. 4569 of 2022 in Suit (L) No. 29721 of 2021



Advocates:
For the Appellants/Petitioners: Chetan Kapadia, Chaitanya Chavan, Rahul Singh, Pranali Raut
For the Respondents: Naushad Engineer, Shreya Jha, Hemang Raythattha, S.M. Seegarla, Shalaka Chamboowala, Swapnil Shikhare, Mayur Khandeparkar, Vikranmjit Garewal, Priyanka Fadia, Shashank Fadia, Ankit Lohia, Aditi Bhat, Kunal Parekh, Nirali Shah, Rohan Agarwal, Prabha Badadare, Bhavin Gada, Manshi Shah

The court found that fraud regarding the contents of a document is voidable, requiring a lawsuit for cancellation within the limitation period, which was not adhered to in this case.

Headnote:(A) Code of Civil Procedure, 1908 - Order VII Rule 11(d) - Limitation Act, 1963 - Suit seeking cancellation of Conveyance Deeds - Interim applications filed for rejection of plaint on grounds of limitation. Court upheld the contention that the suit was barred by limitation, as knowledge of fraud was established beyond the limitation period. (Paras 13, 15, 68)

(B) Limitations - The court highlighted that the plaintiff must sue for cancellation of documents if seeking to declare them void, emphasizing the distinction between fraud related to character and contents of a document. (Paras 60, 64)

Facts of the case:
The plaintiff contended that he was misrepresented and fraudulently led to sign Conveyance Deeds, executing them under false pretenses. He claimed not to have received full consideration, and filed a plaint in December 2021, alleging the deeds were void due to fraud.

Findings of Court:
The court found the suit barred due to the expiration of limitation under Article 59 of the Limitation Act, as the plaintiff had knowledge of the alleged fraud by 2016.

Issues: The main issues included whether the suit was barred by limitation and the nature of the alleged fraud.

Ratio Decidendi: The court ruled that any alleged fraud was concerning the contents of the documents and that the plaintiff must seek cancellation of the documents within three years of becoming aware of the fraud.

Result: The plaint was rejected under Order VII Rule 11(d) as being barred by limitation.

Table of Content
1. ownership issues regarding suit properties (Para 3 , 4 , 5 , 6 , 7 , 8 , 9)
ORAL JUDGMENT :

1 The Interim Application (L) No.2566 of 2022 is filed by Original Defendant Nos.2, 5, 6 and 7 to the captioned Suit whereas Interim Application (L) No.3696 of 2022 has been filed by Original Defendant Nos.1 and 3 to the Suit and Interim Application (L) No.4569 of 2022 has been filed by Original Defendant No.10 on behalf of Defendant Nos.10 to 12 to the Suit. All the Interim Applications are filed under Order VII Rule 11 (d) of the Code of Civil Procedure, 1908 seeking rejection of plaint on the ground that the Suit is barred by limitation. They are being disposed of by this common judgment.

2 There are certain facts in the plaint which are necessary to be adverted to. The Plaintiff’s father namely late Pandurang Barkya Mali was the owner of the suit properties. By a purported agreement for sale dated 30.06.1974, Defendant Nos.8 and 9 who are referred to as Kanayalal Kalooji Jain (‘Jain’) and Narain Tulsidas Kanal (‘Kanal’) in the plaint, sought to purchase suit properties from the Plaintiff’s deceased father. Thereafter, Jain and Kanal entered into agreements dated 05.08.1974 and 18.09.1974 with late J.N. Agarwal (predecessor of Original Defendant Nos.10 to 12) in respect of the suit properties. The late J.N. Agarwal issued public notices and advertisements invited claims in respect of the Suit properties on 06.10.1979 and 11.10.1979. The public notices and advertisements were responded to by the Plaintiff’s deceased father disputing the right of the late J.N. Agarwal to purchase the suit properties as according to him the original agreement with Defendant Nos.8 and 9 had come to an end. Being aggrieved, the late J.N. Agarwal filed Suit No.358 of 1980 before this Court seeking specific performance of agreement dated 18.09.1974. By an order dated 26.11.1982, this Court granted interim injunction restraining the Defendants in the said Suit from in any manner dealing with or disposing of or alienating, encumbering or transferring the suit properties.

3 Thereafter, with the intention of settling the disputes between the Plaintiff’s family and the Agarwal family, Memorandum of Understanding dated 11.12.2008 came to be executed between the Plaintiff, Defendant Nos.13, 15 and Defendant Nos. 3 and 4. Under the said Memorandum of Understanding, Defendant Nos.3 and 4 were the purchasers of the suit properties. The total consideration mentioned therein was a sum of Rs.13,51,00,000/- and for which postdated cheques payable within 11 months were handed over to the Plaintiff. It was agreed between the parties to the said Memorandum of Understanding that Defendant No.1 shall settle/ cause settlement with all parties at their own costs and have the injunction order vacated.

4 Sometime in December 2013, Defendant No.3 called the Plaintiffs and his family members to his office at Gurgaon for the purpose of executing conveyance deeds. The Plaintiff has claimed that Defendant No.3 had informed the Plaintiff that the said Memorandum of Understanding would have to be registered and for which signatures on several documents, bank papers and stamp papers were obtained by Defendant No.3 from the Plaintiff and his family members. It was in the month of February, 2014 when the Plaintiff attended the office of Sub-Registrar and executed the documents during which the Plaintiff has claimed that he happened to get a glimpse of Defendant Nos.8 to 12 in the registration office.

5 The Plaintiff has admitted that he received payment of Rs.96,52,116/- through pay orders towards purchase of the suit property. However, the Plaintiff claims that he accepted the same under the representation made by Defendant No.3 and 4 that these monies were paid towards the balance consideration under the Memorandum of Understanding dated 11.12.2008. On 20.02.2014, the Plaintiff admits that he executed four conveyances for sale of the suit property in favour of Original Def

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