Thursday, 31 January 2013

preliminary issue-order 14 rule 2 of CPC.



preliminary issue.

order 14 rule 2 of cpc.

Court to pronounce judgment on all issues

(1) Notwithstanding that a case may be disposed of on preliminary issue, the Court shall, subject to the provisions of sub-rule (2), pronounce judgment on all issues.

(2) Where issues both of law and of fact arise in the same suit, and the Court is of opinion that the case or any part thereof may be disposed of on an issue of law only, it may try that issue first if that issue relates to-

(a) the jurisdiction of the Court, or

(b) a bar to the suit created by any law for the time being in force, and for that purpose may, if it thinks fit, postpone the settlement of the other issues until after that issue has been determined, and may deal with the suit in accordance with the decision on that issue.


IA 12530/2000 in CS(OS) 1823/2000 Page 1 of 17
THE HIGH COURT OF DELHI AT NEW DELHI
%   Judgment delivered on: 20.09.2010
IA No.12530/2000 in CS(OS) No.1823/2000
Sh. Anil Kumar Sanghi & Anr. ..... PLAINTIFFS
Vs
Sh. Hari Kishan Sanghi & Ors.             ..... DEFENDANTS
                           
Advocates who appeared in this case:
For the Plaintiff : Mr. Pravir K.Jain, Advocate
For the Defendant:  Mr. Arvind Kumar & Ms. Neelam Rathore, Advocates for D-1&2.
Mr. Rajat Aneja, Advocate for D-5/Applicant.
Ms. Padma Priya, Advocate for D-7 / NHAI.
CORAM :-
HON'BLE MR JUSTICE RAJIV SHAKDHER
1.  Whether the Reporters of local papers may
   be allowed to see the judgment ?  No
2.  To be referred to Reporters or not ?  Yes
3.  Whether the judgment should be reported
      in the Digest ?  Yes
RAJIV SHAKDHER, J
IA No. 12530/2000 (O. 7 R. 11 and S. 151 of CPC by Deft. No. 5)
1. By this order I propose to dispose of the captioned application, which  has been
filed by R.K.S. India Pvt. Ltd. erstwhile defendant no.5 (hereinafter referred to as “RKS”)
under the provisions of Order  VII Rule 11 read with Section 151 of the Code of Civil
Procedure, 1908 (in short, “CPC”). 
2. At the outset, as it is evident, this application has been pending for the  last 10
years.   The parties to date have not led evidence. In this context, there are two orders
which I must refer to right in the beginning.  
2.1 First, is  the  order dated 24.01.2001 wherein, it has been noticed that the
applicant/RKS had filed an application under Order VII Rule 11 CPC read with Section
151 CPC for dismissal of the suit  on the ground of lack  of cause of action, and on the
ground of jurisdiction.  The court observed that this objection be taken as a preliminary IA 12530/2000 in CS(OS) 1823/2000 Page 2 of 17
objection in the written statement which would be considered as a preliminary issue.  The
court,  further went on to  observe that the said  application shall be decided by way of
decision on the preliminary issue  arising out of the written statement.  Accordingly,
defendants including applicant/RKS were directed to file their respective  written
statements.  Consequent thereto the defendants have filed their written statements.  The
plaintiffs in response thereto, have filed their replication. 
2.2 The second order, to which reference is required is: order dated 16.12.2003.  By
this order, issues were cast in the suit.  The total number of issues cast in suit are thirty
nine.  Out of these, issue nos.24, 31, 32 & 33 were treated as preliminary issues.  For the
sake of convenience, the said issues are extracted hereinafter :-
“Issue No.24- Whether the suit is not maintainable in terms of Order 7 Rule
11  CPC? OPD3&4
Issue No.31- Whether defendant no.5 is a tenant in different portions of suit
property, as mentioned in sub-paras a, b and c of para A of preliminary
objections of written statement filed by defendant no.5? OPD-5
Issue No.32- If Issue No.32 is answered in the affirmative, whether the suit
is barred under Section 50 of Delhi Rent Control Act? OPD-5
Issue No.33- Whether there is no cause of action against defendant no.5 for
filing the present suit, as alleged in the written statement filed by defendant
no.5?  If so, its effect?  OPD-5”
3. With the aforesaid prefatory note, let me briefly advert to the facts, which in my
view, would be relevant for the purposes of disposal of the captioned application. 
4. The plaintiffs have filed the instant suit for possession, declaration, rendition of
accounts and injunction.  It is averred in the plaint that one Mahabir Prasad, who died in
December, 1970 was blessed with three sons.  These being: Mr. Hari Kishan Sanghi, Mr.
Tek Chand Sanghi and Mr. Ram Kishan Sanghi.  The plaintiffs, that is; Mr. Anil Kumar
Sanghi, Mr. Arun Kumar Sanghi alongwith Mr. Sanjay Kumar Sanghi are progeny of Mr.
Ram Kishan Sanghi and Smt. Indra Devi.  Similarly, Mr. Hari Kishan Sanghi was blessed IA 12530/2000 in CS(OS) 1823/2000 Page 3 of 17
with two sons Mr. Rajender Kumar Sanghi and Mr. O.P. Sanghi.  Mr. O.P. Sanghi had
expired prior to the institution of the present suit.  Mr. Rajender Kumar Sanghi was
married to Smt. Prabha Sanghi.  They were blessed with a son i.e., Mr. Ankur Sanghi.  At
the point in time when, the suit was first instituted, Mr. Hari Kishan Sanghi alongwith his
son,  daughter in law and grandson  were  impleaded as  defendant no.1, 2, 3 and 4
respectively, while Mr. Ram Kishan Sanghi, who was also impleaded in the suit alongwith
his wife Smt. Indra Devi and his third son Mr. Sanjay Kumar were arrayed as  defendant
nos.7, 8 & 9.  Therefore, the two branches of the family emerged.  The branch of Mr. Hari
Kishan Sanghi comprised of himself; his son, Mr. Rajender Kumar Sanghi; his daughterin-law, Ms. Prabha Sanghi; and grandson, Mr.Ankur Sanghi.  The other branch comprised
of the plaintiffs i.e. Mr. Anil Kumar Sanghi and Mr. Arun Kumar Sanghi alongwith their
father Mr. Ram Kishan Sanghi, their mother, Smt. Indra Devi and their brother Mr. Sanjay
Kumar Sanghi.  For the sake of convenience, the two branches are compendiously referred
to hereinafter by me as: Hari Kishan and family; and Ram Kishan and family.  As noticed
above, the two branches traced their root to Mahabir Prasad Sanghi.
5. It is the case of the plaintiffs that Mr. Hari Kishan Sanghi alongwith Mr. Ram
Kishan Sanghi and their brother Mr. Tek Chand Sanghi (who are the uncles of the
plaintiffs) and Sh. Mahabir Parsad Sanghi  (who was the plaintiffs grand father)
constituted a Joint Hindu Family.  It is also the case of the plaintiffs that the said Mahabir 
Prasad Sanghi alongwith his two sons, referred to above, lived as members of a Joint
Hindu Family, and in the process acquired various properties and businesses.  The said
joint family, it is averred, resided in a tenanted property situated at 61, Darya Ganj,  Delhi. 
The above members of the Joint Family  it is averred,  were joint in estate, mess and
worship.
6. What is pertinent for the purposes of the captioned application is that the joint
family, it appears acquired, amongst various other properties,  four (4) plots in Delhi,
which were, numbered as plots nos.1, 2, 3 & 4 Kilokari Village, Ring Road, New Delhi-
110 014 (hereinafter, referred to as Property No.1, 2 and 3 respectively).  These plots, it is IA 12530/2000 in CS(OS) 1823/2000 Page 4 of 17
averred, were acquired in 1957 by the joint family in the name of Mr. Mahabir   Prasad
Sanghi, who was the karta of the joint family.  I am, not for the moment, referring to other
properties and agricultural  lands which, the plaintiffs claim the joint family owns and
possesses. 
6.1 It is also the case of the plaintiffs that in 1960-1962, super-structures were raised
on property nos.1, 2 & 3 out of the funds owned by the joint family. 
6.2 It is averred that in 1964, a partial partition took place between the members of the
joint family, and consequent thereto, property no.3, with the superstructure then obtaining
, fell to the share of the branch of the family headed by Mr. Ram Kishan i.e. the father of
the plaintiffs herein.  In-so-far-as property no.2 was concerned,  by virtue of the very same
partition, fell to the share of Mr. Tek Chand Sanghi, while property no.1 came to the share
of the family of Mr. Hari Kishan Sanghi.
7. It is the case of the plaintiffs that Mr. Hari Kishan Sanghi being the eldest son of
Mr. Mahabir Prasad Sanghi, had in sum and substance taken over the reins of the family,
and thereby exerted great amount of influence on the other members of the family.  The
plaintiffs allege that the affairs of the family, which also included management of  the
property  which fell to the share of Ram Kishan Sanghi and family i.e. Property No.3 was
within the domain of Mr. Hari Kishan Sanghi.  The averments to that effect have been
made in paragraph 14 of the plaint.  There are also averments to the effect that the ground
floor of property no.3 was let out on rent to Ranbaxy, W.H.O., GM (Postage &
Telegraph), etc., and the rents which were realized by Mr. Hari Kishan Sanghi were
deposited, in joint account of  Ram Kishan Sanghi and family. It is further averred that out
of the rental income of the  ground floor of the property no.3, further construction was
carried out whereby, the first floor and the barsati floor alongwith the annexe was raised
on property no.3.  It is alleged that between 1964-1980, the ground floor was let out by
Mr. Hari Kishan Sanghi to various tenants on behalf of Ram Kishan Sanghi  and family. 
For this purpose, it is averred, Mr. Hari Kishan Sanghi obtained a power of attorney in
favour of his son Mr. Rajender Kumar Sanghi from the plaintiffs (i.e. Anil Kumar Sanghi IA 12530/2000 in CS(OS) 1823/2000 Page 5 of 17
and Arun Kumar Sanghi) and Defendant Nos. 7 and 8 (i.e. Mr. Ram Kishan Sanghi and
Smt. Indra Devi).  There is also an averment to the effect that by a registered deed dated
29.03.1980, a partition, in respect of property no.3, took place in the family of Mr. Ram
Kishan Sanghi whereby, the two plaintiffs and Mr. Ram Kishan Sanghi, Smt. Indra Devi
and Mr. Sanjay Kumar acquired 1/5
th
undivided share in property no.3.   It is specifically
averred that this partnership deed was witnesseth by Mr. Hari Kishan Sanghi.  There are
further averments to the effect that in 1989, the first floor of property no.3 was let out to
an entity by the name of Indian  Renewable Energy Development Agency (i.e. M/s.
IREDA) vide lease agreement dated 30.06.1989 at a rent of Rs.45,000/- p.m.
8. In so far as applicant / RKS is concerned, there are averments made in para 22 of
the plaint.  The said averments basically advert to the fact that  in 1975, the joint family
comprising of Mr. Hari Kishan Sanghi, Mr. Ram Kishan Sanghi and Mr. Tek Chand
Sanghi acquired an industrial plot bearing no.10, DLF Industrial Estate, Faridabad by
acquiring share holding rights in the company by the name of M/s.  Optical Instrument
Company Pvt. Ltd., which at that point of time evidently owned the said property. 
Subsequently, it is averred, the name was changed to the present name of applicant i.e.
R.K.S. India Pvt. Ltd.  It is alleged that the management and control of the said company
was, however, entrusted to Mr. Hari Kishan Sanghi. 
9. What is important is that the plaintiffs have specifically adverted to the fact that 
Mr. Hari Kishan Sanghi had got signatures of Mr. Ram Kishan Sanghi, Smt. Indra Devi
and Mr. Sanjay Kumar on blank papers and documents which included stamp papers by
representing to them that the said documentation was required for taxation purposes. 
There is also a reference to the fact that in early 1991, the ground floor of property no.3
was let out to one French company  at  a rent of Rs.1,30,000/- p.m., out of which   only
Rs.30,000/- was shown as the rent, while the balance sum was shown as “liaison charges”
only to avoid tax liability.  The fact that the signatures on documents were appended by
Mr. Hari Kishan Sanghi, in good faith, is also adverted in para 24 and 28 of the plaint.IA 12530/2000 in CS(OS) 1823/2000 Page 6 of 17
10. The plaintiffs have filed a site plan to show that while the annexe to the super
structure built on property no.3 is in their possession, including the drive way and all other
portions marked therein in yellow colour, the first floor and the barsati, which is marked in
red colour, is in possession of Hari Kishan Sanghi and family.  It is averred that the first
floor and the barsati floor is occupied by M/s. Pulse Impulse Health Club Fitness Centre,
which is an entity controlled by Hari Kishan Sanghi and family.  At the relevant point in
time, the ground floor which is marked green, in the site plan, was occupied by defendant
no.10 i.e. National Highway Authority of India (in short „NHAI). 
10.1 To be noted during the pendency of the proceedings,  NHAI  has vacated the
premises.  Reference in this regard may be made to order dated 23.09.2002 passed by this
court.
11. In the background of these broad averments, the plaintiffs have sought reliefs of
declaration that they are owners of property no.3, more specifically comprising of the
main building, annexe, servant quarters and  garages shown in colour yellow, red, green
and brown in the site plan appended to the plaint.   The plaintiffs also sought possession of
entire first and barsati floor of property no.3 alongwith servant quarters and  garages
shown in colour red in the site plan appended to the plaint.  A mandatory injunction was
also sought at the relevant point in time qua NHAI India as also the injunction against
Hari Kishan Sanghi and family against creating any third party rights in property no.3 or
any part thereof.  There are other reliefs also sought for, such as rendition of accounts with
regard to other properties, I am  not detailing the same out, as presently one is  not
concerned with them.
12. The applicant/ RKS in both in the written statement as well as in the captioned
application  has raised preliminary objections with regard to lack of cause of action qua
itself, as  also raised objection as to the jurisdiction  of the court to entertain and try the
instant suit in the background of the following averments.  Briefly, these are  as follows:-IA 12530/2000 in CS(OS) 1823/2000 Page 7 of 17
(i) Vide lease deed dated 22.05.1985 executed in its favour by Ram Kishan
Sanghi  and family, it acquired  leasehold  rights in the second floor of
property no.3 alongwith three floors in the annexe block.  The rent as per
the lease deed is a sum of Rs.1,000/- p.m.  More importantly, as per the
said lease deed, applicant/RKS  could use the demised premises not only
for commercial and residential purposes but could also sub-let the demised
premises or any part thereof.
(ii) It is averred that by virtue of yet another lease deed dated 09.07.1990,
applicant/RKS surrendered possession of the annexe block in favour of 
Ram Kishan Sanghi  and family, however, it retained tenancy rights with
respect to the second floor of the main building of property no.3.  The rent,
however, remained fixed at Rs.1,000/- p.m.  In so far as the ground floor of
the main building of property no.3 was concerned, it was let out to the
applicant/RKS for commercial and residential purposes at a rent of
Rs.2500/- with a further right to further sub-let.
(iii)By virtue of a lease deed dated 04.01.1995, Shri Hari Kishan Sanghi acting as
the attorney of  Ram Kishan Sanghi and family, leased out the first floor of
the main building of Property no.3 to the applicant/RKS @ Rs.2,000/- p.m. 
In this lease deed as well the applicant/RKS was given the right to sub-let
the demised premises. 
(iv)The applicant/RKS has averred that it is an independent entity which has
acquired tenancy right in the ground floor, first floor and the second /
barsati floor of the main building of property no.3.  It is thus submitted by
applicant/RKS that neither does it have anything to do with the joint family
nor has any cause of action arisen against it.  It is, therefore pleaded, that
since  there is no cause of action in so far as applicant / RKS is concerned,
it should be deleted from the array of parties by taking recourse to
provisions of Order 1 Rule 10(2) of the CPC. IA 12530/2000 in CS(OS) 1823/2000 Page 8 of 17
(v) In addition, it is also pleaded that the suit is not maintainable in view of the
provisions of Section 50 of Delhi Rent Control Act, 1958 (in short, D.R.C.
Act).  The stance being that: since the rent of the  various portions of the
main building of property no.3 (referred to above) is  less than Rs.3500/-
p.m., it is a matter over which  only  the Rent Controller  would have
jurisdiction, and therefore, by virtue of Section 50 of the D.R.C. Act, the
jurisdiction of this court is ousted.  In this connection, it is specifically
averred that the plaintiffs while, referring to the fact that Mr. Hari Kishan
Sanghi had let out various portions of property no.3 from time to time to
various tenants; had concealed the material fact pertaining to execution of
the three lease deeds referred to in the written statement, and the captioned
application.
13. At this juncture, it may perhaps be  pertinent to refer to order dated 06.04.2005
passed in IA No.3191/02 whereby, NHAI which was erstwhile defendant no.10 was
deleted from the array of parties based on the application filed by NHAI.  The application
was  pivoted  on the circumstance that  since  NHAI was inducted as a sub-tenant in  a
portion of property no.3, and the fact that, it had vacated the premises on 30.09.2009; it
ought to be deleted from the array of parties as, no relief was sought against it.  The court
based on the application of NHAI directed its deletion from the array of parties.  NHAI
was, however, directed to file copy of the lease deed, by which, it had been inducted as a
tenant.
13.1 By the very same order, directions were passed in IA 12531/2000, whereby Mr.
Ram Kishan Sanghi, erstwhile defendant no.7, Smt. Indra Devi, erstwhile defendant no.8
and Mr. Sanjay Kumar, erstwhile defendant no.9 were transposed as plaintiffs.  In these
circumstances, plaintiffs were directed to file an amended memo of parties.  These orders
are referred to for the purposes of bringing to fore the fact that the original memo of IA 12530/2000 in CS(OS) 1823/2000 Page 9 of 17
parties stood amended; therefore, as noticed above, the defendants are largely referred to
by name.  
14. Mr. Aneja, who appeared for the applicant/RKS has argued before me that in view
of the  lease deeds referred to hereinabove, the execution of which according to him being
not in dispute, the plaint ought to be rejected in so far as the applicant/RKS is concerned
as mandated by the provisions of Order VII Rule 11 (a) & (d) of the CPC.  Mr. Aneja has
also argued that the plaintiffs have not as a matter of fact impugned the said lease deeds. 
It is submitted that the plaintiffs ought to have, in terms of Section 34 of the Specific
Relief Act, 1963 sought a declaratory relief with respect to the said lease deeds.  The suit
in these circumstances according to Mr. Aneja is not maintainable.  It is also urged by Mr.
Aneja that provisions of Section 92 of the Indian Evidence Act, 1872 would prevent the
plaintiffs from leading any evidence contrary to the contents of the said lease deeds. 
15. Mr. Jain, who appeared for the plaintiffs, submitted that this court is presently
called upon only to deal with the application filed under Order VII Rule 11 (a) & (d) of
the CPC, therefore,  the court would only be required to examine the averments made in
the plaint.  It was contended by him that from the averments made in the plaint, it would
be quite clear that cause of action, as against the applicant, does arise.  In so far as the case
set up by the applicant/RKS with regard to ouster of jurisdiction is concerned, Mr. Jain
relied upon those averments made in the plaint, wherein it has been stated by the plaintiffs
that from time to time signatures had been obtained of the members of Ram Kishan
Sanghi  and family by  Shri Hari Kishan Sanghi on blank papers which included stamp
papers, on the pretext that they were required for tax purposes.   Mr. Jain also refers to the
averments made in the replication to the written statement filed by the applicant/RKS to
contend and demonstrate that the veracity of the said lease deeds is squarely challenged. 
Mr. Jain specifically adverted to the fact that there is no denial of the averments made in
the plaint to the effect that the portions of the property no.3 were let out from time to time
on rents which were far in excess of Rs.3,500/-.  In this context, one such lease deed dated IA 12530/2000 in CS(OS) 1823/2000 Page 10 of 17
30.06.1999, amongst others, was referred to.  Mr. Jain also sought to contend that, the
affairs of property no.3 were managed by Shri Hari Kishan Sanghi  as the attorney of Ram
Kishan Sanghi and family.  He drew my attention to various documents appended at pages
166, 173 & 186  of the documents filed by the plaintiffs  to demonstrate that Shri Hari
Kishan Sanghi was  acting for and on behalf of Ram Kishan Sanghi and family in respect
of property no.3 before the Municipal Corporation of Delhi for the purposes of assessment
of property tax.
16. I have heard learned counsel for the parties.  In my view, there are two aspects to
the matter: first, whether the issue nos. 24, 31, 32 and 33 can be tried as preliminary
issues.  It is pertinent to note that parties have been stuck; at this stage, and consequently,
have not led evidence since December, 2003, only for this reason.  The second aspect is
whether captioned application is maintainable.  Let me deal with the second aspect, first,
since one is required to tread a known path.   It is trite law that  while dealing with an
application under Order  VII Rule 11 CPC, the court is only required to look at the
averments made in the plaint.  The averments made in the written statement are wholly
irrelevant in order to ascertain as to whether or not, there arises a cause of action or, even
with respect to bar of maintainability of the suit.   If an authority is required for this
purpose, I would rely upon the judgment of the Supreme Court in the case Ramesh B.
Desai and Ors. Vs. Bipin Vadilal Mehta and Ors. (2006) 5 SCC 638 at pages 650-652
paragraphs no.14 & 15.  In this case, a company petition filed under section 155 (of the
then prevailing provisions of the Companies Act, 1956) was dismissed on the ground of
limitation by relying upon averments made in affidavit-in-reply. The Supreme Court in
this context made the following observations:-
“14. The plea raised by the contesting respondents is in fact a plea of
demurrer.  Demurrer is an act of objecting or taking exception or a protest. 
It is a pleading by a party to a legal action that assumes the truth of the
matter alleged by the opposite party and sets up that it is insufficient in law to
sustain his claim or that there is some other defect on the face of the
pleadings constituting a legal reason why the opposite party should not be IA 12530/2000 in CS(OS) 1823/2000 Page 11 of 17
allowed to proceed further.  In O.N. Bhatnagar V. Rukibai Narsindas (SCC
Para 9) it was held that the appellant having raised a plea in the nature of
demurrer, the question of jurisdiction had to be determined with advertence to
the allegations contained in the statement of claim made by Respondent under
Section 91(1) of the Act and those allegations must be taken to be true.  In
Roop Lal Sathi Vs. Nachhattar Singh Gill (SCC Para 24) it was observed that
a preliminary objection that the election petition is not in conformity with
Section 83(1)(a) of the Act i.e. it does not contain the concise statement of the
material facts on which the petitioner relies, is but a plea in the nature  of
demurrer and in deciding the question the Court has to assume for this purpose
that the averments contained in the election petition are true.  Reiterating the
same principle in  Abdulla Bin Ali V. Galappa it was said that there is no
denying the fact that the allegations made in the plaint decide the forum and
the jurisdiction does not depend upon the defence taken by the defendants in
the written statement.  In Exphar SA V. Eupharma Laboratories Ltd. (SCC
Para 9) it was ruled that where an objection to the jurisdiction is raised by
way of demurrer and not at the trial, the objection must proceed on the basis
that the facts as pleaded by  the initiator of the impugned proceedings are
true.  The submission in order to succeed must show that granted those facts
the court does not have the jurisdiction as a matter of law.  In this case the
decision of the High Court on the point of the jurisdiction was set aside as
the High Court had examined the written statement filed by the respondents
in which it was claimed that the goods were not at all sold within the
territorial jurisdiction of the Delhi High Court and also that Respondent no.2
did not  carry out business within the jurisdiction of the said High Court. 
Following the same principle in  Indian Mineral & Chemicals Co. V.
Deutsche Bank (SCC paras 10 and 11), it was observed that the assertions in
a plaint must be assumed to be true for the purpose of determining whether
leave is liable to be revoked on the point of demurrer.
15. The principle underlying clause (d) of Order 7 Rule 11 is no different. 
We will refer here to a recent decision of this Court rendered in Popat and
Kotecha Property Vs. State Bank of India Staff Assn. where it was held as
under in para 10 of the report: (SCC p.515).
“10.Clause (d) of Order 7 Rule 7 speaks of suit, as appears
from the statement in the plaint to be barred by any law. 
Disputed questions cannot be decided at the time of
considering an application filed under Order 7 Rule 11 IA 12530/2000 in CS(OS) 1823/2000 Page 12 of 17
CPC.  Clause (d) of Rule 11 of Order 7  applies in those
cases only where the statement made by the plaintiff in the
plaint, without any doubt or dispute shows that the suit is
barred by any law in force”.
16. It was emphasized in para 25 of the reports that the statement in the
plaint without addition or subtraction must show that it is barred by
any law to attract application of Order 7 Rule 11 CPC. The principle
is, therefore, well settled that in order to examine whether the plaint is
barred by any law, as contemplated by Sub-rule (d) of Order VII Rule
11 CPC, the averments made in the plaint alone have to be seen and
they have to be assumed to be correct. It is not permissible to look into
the pleas raised in the written statement or to any piece of evidence.
Applying the said principle, the plea raised by the contesting
respondents that the Company Petition was barred by limitation has
to be examined by looking into the averments made in the Company
Petition alone and any affidavit filed in reply to the Company Petition
or the contents of the affidavit filed in support of Company
Application No. 113 of 1995 filed by the respondents seeking
dismissal of the Company Petition cannot at all be looked into.”
16.1 As noticed hereinabove, the plaintiffs who are a part of Ram Kishan Sanghi  and
family, have  averred in the plaint that by virtue of partition carried out in 1964, property
no.3 fell to their share.  It was also their case that the affairs with respect to the said
property no.3 were looked after by  Shri Hari Kishan Sanghi.  In the plaint, there are
specific averments to the effect that Shri Hari Kishan Sanghi had obtained signatures of
Shri Ram Kishan Sanghi and other members of his family on blank documents, papers and
stamp papers on the pretext that they were required for income tax purposes.  Whether
these documents included the lease deeds in issue, is a matter which can only be
ascertained after evidence is led by the parties.  It is well settled execution of documents
by itself does not establish the veracity of contents of documents. (See Judah vs. Isolyne
Shrojbashini Bose and Anr. AIR(32) 1945 Privy Council 174 and Ramji Dayawala and
Sons (P) Ltd. vs. Invest Import (1981) 1 SCC 80  at page 90-91, para 16.  The relevant
observations being:IA 12530/2000 in CS(OS) 1823/2000 Page 13 of 17
“16…….Undoubtedly, mere proof of the handwriting of a document would not
tantamount to proof of all the contents or the facts stated in the document.  If
the truth of the facts stated in a document is in issue mere proof of the
handwriting and execution of the  document would not furnish evidence of the
truth of the facts or contents of the document.  The truth or otherwise of the
facts or contents so stated would have to be proved by admissible evidence,
i.e. by the evidence of those persons who can vouchsafe for the truth of the
facts in issue....”
17. In the instant case  as is evident from the reply filed to the captioned application
while signatures on the first and second lease deeds dated 22.05.1985 and 09.07.1990 are
accepted the truth of the contents of the said lease deeds is disputed.  In so far as the third
lease deed dated 04.01.1995 is concerned what is evident on the bare perusal, is that, while
Hari Kishan Sanghi has acted on behalf of the landlord, as the attorney for Ramkishan and
family; on behalf of the applicant RKS i.e., the lessee, the lease is signed by one Neeta
Khanna.  Evidence will have to be led to vouch safe the truth of the contents of the said
lease deeds.  Furthermore, notwithstanding the submissions of Mr. Aneja that by virtue of
Section 92 of Indian Evidence Act, 1872, the plaintiffs cannot lead evidence contrary to
the contents of documents, it is well settled that evidence can be led  to  explain the
circumstances in which the documents were executed, or even to show that an agreement
was executed to create evidence with regard to another matter.  In other words, as in the
instant case there was no lease created, the document was created only for tax purposes.
See Raj Satyendra Nath Ray Chaudhury Bahadur Vs. Pramananda Haldar and Ors 164
Ind Cas 437.  The observations made in paragraph 4, 5 & 6 being relevant are extracted
below:-
“4……..But under proviso 1 to Section 92, oral evidence is admissible to
prove the circumstances which would invalidate any such document.  The
circumstances enumerated in the said proviso, e.g., fraud, etc., are
illustrative and not exhaustive.  In my opinion the fact that an instrument,
registered or unregistered, was not intended to be acted upon from the very
beginning is a fact which comes within proviso 1 and can be proved either by
direct oral evidence or by indirect or circumstantial evidence furnished by IA 12530/2000 in CS(OS) 1823/2000 Page 14 of 17
the conduct of the parties.  If the cases are examined in this light there is no
conflict whatsoever……
5.    ….In the case Bini Madhub Gorani V. Labnoii Dassi 6 CWN 242, where
the defence in a suit for rent based upon a registered kabuliyat, was that the
kabuliyat was never intended to be acted upon; Rampini, J., sitting singly held
that oral evidence adduced to sustain the defence was not admissible but on
Letters Patent Appeal he was overruled by Maclean, C.J., and Macpherson, J.
Maclean, C.J., observed, firstly, that :
Evidence would be admissible to show that, as between the landlord
and the tenant, the document was never intended to be acted upon.
6. The learned Chief Justice further observed (in which observation
Macpherson, J. also concurred) that evidence would also be admissible “to
show that there has been, as between the parties to this document, a waiver
of some of its terms.”  As I shall show later on the last mentioned observation
only has been taken exception to it later cases and must be held to be not good
law in view of the decision of the Full Bench in the case of Lalit Mohan Ghost
Vs. Gopali Chuck Coal Company 39 C 284: 12 Ind. Cas. 723 : 16 CWN 55 : 11
CLJ 411, but I am not aware of any case of this Court which has either
dissented from or even cast doubt upon the first mentioned observation of the
learned Chief Justice.  In the same case Macpherson, J. made the following
observations:
The defendant in this case does not attempt to give any evidence of an
oral agreement rescinding or contradicting the contract as to amount of the
rent payable, but as both the lower Courts have found, he did prove that since
the time the agreement was entered into he had always paid rent at a lower
rate than that stated in the agreement.   The evidence was, in my opinion,
distinctly admissible, not for the purpose of contradicting  the terms of the
agreement, but for the purpose of showing, as the learned Chief Justice has
pointed out, that the intention of the parties was, that the agreement was
from the first not intended to be acted upon.”
17.1 In any event, onus with regard to the lease deeds in issue would rest on the
applicant / RKS.   As to what would be the effect of not seeking a declaration of Section
34 of the Specific Relief Act, 1963 will be seen at the stage of final adjudication.  These
are submissions made at the  bar; there is no reference to them either in the written
statement or in the captioned application.IA 12530/2000 in CS(OS) 1823/2000 Page 15 of 17
18. This brings me to the first aspect.  As noticed hereinabove, the court by order dated
24.01.2001 had directed that objections contained in the application under O. VII Rule 11
CPC should be incorporated in the written statement.  It was only on 16.12.2003 that the
court held issue no.24, 31, 32 and 33 be tried as preliminary issues.  A bare reading of the
provisions of Order XIV Rule 2(2) would show  that preliminary issues are those issues
which can be tried as pure question of law, and pertain to jurisdiction or to bar to the suit
created by law in force.   Sub-rule (2) of Rule 2 of Order XIV is an exception to sub-rule
(1) of rule (2) Order XIV which requires the court to try all issues.   Therefore, before a
Court comes to a conclusion that an issue should be tried as a preliminary issue, it
ordinarily would assess, as to whether it is a question of law, fact or a mixed question of
law and fact.  Though, B.N. Kirpal, J. (as he then was) in the case of Mohammad Yasin
Vs. Abdul Kalam and Anr. 32(1987) DLT 143” has observed that even  “if  some
evidence” is required to be led an issue can be tried as a preliminary issue.  The
observations of court being relevant are extracted hereinbelow :-
“ I am unable to agree with the contention of the learned counsel for the
petitioner that the issue of law pertaining to jurisdiction or to the
maintainability of the suit must be such in which no evidence at all is to be
recorded.  The expression “issue of law” occurring in sub-rule (2) of Order
14 Rule 2 is in contra-distinction to the expression “issue of fact”.  Whether
the court has the jurisdiction to try the suit or may not solely be a question of
fact.  It may be a question of law or a mixed question of fact and law.  In my
opinion, even a mixed issue of fact and law, but which pertains to the
jurisdiction of the court to try the suit, would be covered by Order 14 Rule
2(2).  The reason for this is obvious.  If the court has no jurisdiction to try the
suit then its decision on other issues arising in the case would be of no avail. 
If no suit is maintainable then the court would have no jurisdiction to give any
decision on any other issue arising in the suit.  Order 14 Rule 2 has been
amended with a view to expedite the trial of the suit.  Previously, all legal
issues on which the suit could be disposed of  could be tried as preliminary
issues.  Now a restriction  has been placed by the amendment and the
restriction is that it is only that preliminary issue pertaining to the jurisdiction
of the court or the maintainability of the suit which can be tried as a IA 12530/2000 in CS(OS) 1823/2000 Page 16 of 17
preliminary issue.  If  in deciding the jurisdiction of the court or the
maintainability of the suit some evidence has to be recorded, that does not
mean that the court would have no jurisdiction to direct such an issue to be
treated as a preliminary issue. The trial court, therefore, in my opinion, was
right in coming to the conclusion that the issue with regard to jurisdiction
would be tried as a preliminary issue.”
(Emphasis is mine)
18.1 However,  if an issue is completely a question of fact, it cannot be tried as a
preliminary issue.   [See paragraph 13 at page 650 of Ramesh B. Desai (supra)].  The
relevant observations made in para 13 is extracted hereinbelow:
“13…….. Though there has been a slight amendment in the language of
Order 14 Rule 2 CPC by the amending Act, 1976 but the principle
enunciated in the abovequoted decision still holds good and there can be
no departure from the principle that the Code confers no jurisdiction
upon the  court to try a suit on mixed issues of law and fact as a
preliminary issue and where the decision on issue of law depends upon
decision of fact, it cannot be tried as a preliminary issue.”
19. Whether an issue ought to be tried as preliminary issue is completely in the
discretion of the trial court.   Furthermore, where the court is of the view, in respect of
even an issue of jurisdiction; that evidence would be required to be led, it ordinarily would
not be tried as a preliminary  issue: Shyam Sundar Mohapatra Vs. Janaki Ballav Patnaik
& Ors. AIR 1990 Orissa 23; Mithlesh Kumari & Ors. Vs. Gaon Sabha Kishanpur &
Ors. AIR 1999 All. 304; Sidh Nath & Ors. Vs. Distt. Judge Mirzapur & Ors. AIR 2002
All. 356; Canbank Financial Services Ltd. Vs. V.B. Desai & Anr. AIR 2002 Bom. 247
and Shoib Ullah & Ors. Vs. Bhartesh Chandra Jain & Anr. AIR 2003 All. 31.  
20. From a conspectus of the facts obtaining in this case, as brought out in the plaint,
in my view, evidence would be required to be led by parties.  Whether after evidence is
adduced by parties, the court is in a position to dispose of the suit on the bases of issues
no.24, 31, 32 and 33 is a matter, which a court could revisit, at that stage.  Given the time
which has lapsed, in the fitness of things, I deem it fit  to direct parties to lead evidence on IA 12530/2000 in CS(OS) 1823/2000 Page 17 of 17
all issues.  Accordingly, the captioned application is dismissed with observation made
hereinabove.
21. In view of the above, the captioned application is dismissed.  Needless to say any
observations made herein will not impact the merits of the case.
CS(OS) 1823/2000
22. List on 19.10.2010 before the Joint Registrar.  The plaintiffs shall file their list of
witnesses, if not already filed, within two weeks from today alongwith affidavit by way of
evidence.   The plaintiffs shall ensure the presence of their witnesses for the purposes of
their examination on the date fixed above.
RAJIV SHAKDHER, J
SEPTEMBER 20, 2010
yg




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