Delhi High Court: In a Criminal Revision Petition filed under Section 115 of the Code of Civil Procedure, 1908 (‘CPC’) to set aside an order dated 27-02-2024 passed by the Additional District Judge (‘ADJ’) wherein the petitioner’s application was dismissed under Order VII Rule 11 read with Section 151 of CPC, a Single Judge Bench of Neena Bansal Krishna, J. held that the ADJ had rightly dismissed the application under Order VII Rule 11 of the CPC.
Background
The respondent had filed a civil suit for the specific performance of an agreement to sell along with alternate relief of recovery, wherein it was contended that in 1981, he was inducted as a tenant by the mother of the petitioner at a monthly rent of Rs. 250/- per annum for a shop on the ground floor of H-25, Main Market, Rajouri Garden, New Delhi (‘suit premises’).
The respondent contended that at the time of being inducted as a tenant, he had paid a substantial amount as Pagri Rakam and, in acknowledgment of the same, the petitioner orally agreed to execute a sale deed on payment of an additional sum of Rs. 35,00,000/-.
On 07-07-2019, the terms of sale were agreed upon, and it was decided that the above-said sum would be paid to the petitioner over a period of four years in monthly instalments of Rs. 25,000/- in addition to the monthly rent of Rs. 3000/-.
It was also contended that after the respondent paid the total additional sale consideration, if, for some reason, the sale deed was not executed in his favour, the petitioner would acquire another similar shop in the vicinity and transfer the ownership of the same to the respondent.
The petitioner submitted that he filed an eviction petition dated 09-08-2021 against the respondent on grounds of bona fide requirement, and as a response, the said suit was filed alleging an oral agreement to sell.
In his application under Order VII Rule 11 CPC, the petitioner claimed that there was no cause of action disclosed in the plaint by the respondent and that the claim was evidently false because there was no averment of an oral agreement to sell in the eviction petition. Subsequently, after half a month of filing the leave to defend, an application under Section 151, CPC dated 26-10-2021 was filed wherein the plea of an oral agreement to sell was taken for the first time.
The leave to defend and the application under Section 151, CPC was dismissed by the Rent Controller, and an Eviction Order dated 05-01-2022 was passed against the respondent regarding the suit premises.
Thereafter, the petitioner filed a Rent Revision under Section 25-B (8) of the Delhi Rent Control Act, which is pending disposal. The petitioner, thus, sought rejection of the plaint by asserting that the suit for specific performance of the oral agreement to sell and permanent injunction filed by the respondent was without any cause of action and was not maintainable for being an abuse of the process of law.
The application under Order VII Rule 11 CPC was dismissed vide order dated 27-02-2024 by the ADJ wherein it was observed that the plaint showed that there was cause of action in the suit since it was no more res integra that suit for specific performance of an oral agreement to sell, was maintainable.
Aggrieved by the said dismissal, the petitioner challenged the impugned order on the ground that the ADJ had failed to appreciate that the respondent was a tenant since 1981 and that the plea of the alleged agreement to sell without any written contract was untenable.
Analysis and Decision
The Court stated that the basic question was whether the respondent could sustain his suit for specific performance based on an oral agreement to sell.
The Court said that it was no longer res integra that only averments made in the plaint can be considered to determine an application under Order VII Rule 11, CPC. While discussing the validity of oral agreements to sell, the Court referred to Aloka Bose v. Parmatma Devi (2009) 2 SCC 582 wherein the Supreme Court observed that an agreement of sale comes into existence when the vendor agrees to sell and the purchaser agrees to purchase for an agreed consideration on agreed terms and the same can be oral or reduced to writing.
Further, the Court noted that the main contention of the respondent was that the provisions of the amended Transfer of Property Act, Registration Act, and Stamp Act now mandate a registered agreement to sell, thereby making the oral agreement to sell untenable under law.
The Court said that as per the proviso to Section 49 of the Registration Act, even though an unregistered agreement to sell may not be considered for protection of the possession pursuant to part performance of an unregistered agreement to sell as provided under Section 53A of the Transfer of Property Act, but an oral agreement to sell continues to be relevant and admissible as evidence for the purpose of specific performance of an oral agreement to sell.
The Court referred to Sukhwinder Kaur v. Amarjit Singh1 and said that if the agreement to sell is not accompanied by the possession of property, then the same does not require registration. Thus, it was concluded in the said case that the specific performance of an unregistered agreement to sell can be sought when possession of the property has not been handed over.
Therefore, the Court found it evident that the plea regarding the oral agreement to sell dated 07-07-2019 required evidence to be proved, and the cause of action in this regard was disclosed in the suit.
Another aspect that the Court mentioned was that the respondent specifically averred that he made monthly payments of Rs. 25,000/- from December 2019 along with his rent, and this was duly acknowledged by the petitioner on the back of rent receipts. It was noted that the alternative prayer of the respondent in the civil suit was for a refund of the said money and thus, the suit could not be said to be without any cause of action.
Thus, while dismissing the present petition for lack of merit, the Court held that the ADJ had rightly concluded that the plaint disclosed the cause of action and dismissed the application under Order VII Rule 11, CPC.
[Amarjit Singh Kohli v. Ashok Kumar Sapra, 2024 SCC OnLine Del 7867, Decided on 08-10-2024]
Judgment authored by Justice Neena Bansal Krishna
Advocates who appeared in this case :
For Petitioner — Advocate Jugal Wadhwa, Advocate Raghav Goyal, Advocate Rishab Bhalla
For Respondent — Advocate Gurmukh Singh Arora, Advocate Abhishant Kumar, Advocate Aastha Thakur
1. C.R. No. 2616/2011
