Supreme Court Upholds Civil Court's Jurisdiction in Suit for Cancellation of Sale Deed on Ground of Fraud. Section 331 of U.P. Zamindari Abolition and Land Reforms Act, 1950 Does Not Bar Suit When Recorded Tenure Holder's Title Is Not Under Cloud.

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Case Note & Summary

The appeals arose from a suit filed by M/s Nupur Housing Development Pvt. Ltd. (plaintiff) against Narendra Kumar Mittal and others (defendants) for cancellation of a sale deed dated 15.06.2006 and for injunction. The plaintiff claimed to have purchased the disputed agricultural land from the first defendant under five sale deeds dated 17.10.1998. During proceedings for mutation, the plaintiff discovered that the first defendant had illegally sold the same property to defendants 2 to 5 through four registered sale deeds dated 15.06.2006. The plaintiff filed Original Suit No.55 of 2008 before the Civil Judge, Gautam Budh Nagar, seeking cancellation of the 2006 sale deeds and injunction against interference with possession. The second defendant challenged the maintainability of the suit under Section 331 of the U.P. Zamindari Abolition and Land Reforms Act, 1950, which bars civil court jurisdiction over certain matters. The Civil Court held the suit maintainable, and the Allahabad High Court dismissed the revision petition. The Supreme Court granted leave and heard the appeals. The core legal issue was whether the civil court had jurisdiction to entertain a suit for cancellation of a sale deed on grounds of fraud when the property is agricultural land covered by the Act. The appellant argued that Section 331 bars the suit, while the respondent contended that the bar does not apply as the suit sought only cancellation and injunction, not declaration of title. The Supreme Court, relying on Bismillah v. Janeshwar Prasad, Ram Padarath v. Second ADDL D.J., and Shri Ram v. Ist Addl. Distt. Judge, held that exclusion of civil court jurisdiction must be strictly construed. Since the plaintiff was a recorded tenure holder with prima facie title under the 1998 sale deeds and did not seek declaration of title, the suit for cancellation of the void document on fraud grounds was maintainable in civil court. The Revenue Court lacks jurisdiction to cancel a deed for fraud. The Court distinguished Kamla Prasad v. Kishna Kant Pathak, where the plaintiff was not a recorded tenure holder. Consequently, both appeals were dismissed with no order as to costs.

Headnote

A) Civil Procedure - Jurisdiction of Civil Court - Exclusion of Jurisdiction - Section 331 of U.P. Zamindari Abolition and Land Reforms Act, 1950 - The statutory provisions ousting jurisdiction of civil court must be strictly construed. A suit for cancellation of a sale deed on the ground of fraud and misrepresentation is maintainable in civil court when the plaintiff is a recorded tenure holder with prima facie title and does not seek declaration of title. Revenue Court has no jurisdiction to grant cancellation of a deed on fraud ground. (Paras 6-10)

B) Land Law - Cancellation of Sale Deed - Maintainability - Section 331 of U.P. Zamindari Abolition and Land Reforms Act, 1950 - A recorded tenure holder in possession, having purchased property under prior sale deeds, can file a suit in civil court for cancellation of subsequent sale deed obtained by fraud. The bar under Section 331 does not apply as the plaintiff's title is not under cloud and no declaration of title is required. (Paras 7-10)

C) Precedent - Distinction - Suit for Cancellation vs. Declaration - Section 331 of U.P. Zamindari Abolition and Land Reforms Act, 1950 - The Full Bench of Allahabad High Court in Ram Padarath v. Second ADDL D.J. held that a suit for cancellation of a void document lies in civil court unless a declaration of right or status of a tenure holder is necessarily needed. This was approved by the Supreme Court in Shri Ram v. Ist Addl. Distt. Judge. (Paras 8-9)

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Issue of Consideration

Whether a suit for cancellation of a sale deed on the ground of fraud and misrepresentation, filed by a recorded tenure holder in possession, is maintainable in civil court despite the bar under Section 331 of the U.P. Zamindari Abolition and Land Reforms Act, 1950?

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Final Decision

Both appeals dismissed. The suit filed by the plaintiff is maintainable in civil court. No order as to costs.

Law Points

  • Exclusion of civil court jurisdiction must be strictly construed
  • Suit for cancellation of void document lies in civil court
  • Revenue Court lacks jurisdiction to cancel deed on fraud ground
  • Recorded tenure holder with prima facie title need not seek declaration in Revenue Court
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Case Details

2019 LawText (SC) (7) 18

Civil Appeal No. 5979 of 2019 (Arising out of S.L.P. (Civil) No.8352 of 2015) with Civil Appeal No. 5980 of 2019 (Arising out of S.L.P. (Civil) No.8528 of 2015)

2019-07-31

N.V. Ramana, S. Abdul Nazeer

Narendra Kumar Mittal & Ors.

M/s Nupur Housing Development Pvt. Ltd. and Anr.

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Nature of Litigation

Civil suit for cancellation of sale deed and injunction

Remedy Sought

Plaintiff sought cancellation of four registered sale deeds dated 15.06.2006 and injunction restraining defendants from interfering with its possession

Filing Reason

Plaintiff discovered that first defendant had illegally sold the disputed property to defendants 2 to 5 while plaintiff had already purchased it under earlier sale deeds

Previous Decisions

Civil Court held suit maintainable; Allahabad High Court dismissed revision petition against that order

Issues

Whether the suit for cancellation of sale deed and injunction is barred under Section 331 of the U.P. Zamindari Abolition and Land Reforms Act, 1950? Whether a recorded tenure holder with prima facie title can maintain a suit in civil court for cancellation of a void document on ground of fraud?

Submissions/Arguments

Appellant (second defendant): Suit in respect of agricultural land is barred under Section 331 of the Act. Respondent (plaintiff): Suit is only for cancellation of sale deed and injunction, not for declaration of title, hence bar under Section 331 is not attracted.

Ratio Decidendi

A suit for cancellation of a sale deed on the ground of fraud and misrepresentation is maintainable in civil court even if the property is agricultural land covered by the U.P. Zamindari Abolition and Land Reforms Act, 1950, provided the plaintiff is a recorded tenure holder with prima facie title and does not seek declaration of title. Section 331 of the Act does not bar such a suit because the Revenue Court lacks jurisdiction to cancel a deed on fraud grounds.

Judgment Excerpts

The statutory provisions ousting the jurisdiction of the civil court need to be strictly construed. Section 331 of the Act does not deprive a party of his right to approach competent court of law for getting a document cancelled, especially when, prima facie, the title of the recorded tenure holder is not under cloud. Revenue Court does not have jurisdiction of granting relief of cancellation of a deed on the ground of fraud and misrepresentation. A recorded tenureholder having prima facie title in his favour can hardly be directed to approach the revenue court in respect of seeking relief for cancellation of a void document.

Procedural History

Plaintiff filed Original Suit No.55 of 2008 before Civil Judge (Sr. Division), Gautam Budh Nagar. Second defendant challenged maintainability under Section 331 of the Act. Civil Court vide order dated 22.05.2014 held suit maintainable. Second defendant filed revision before Allahabad High Court, which was dismissed on 17.11.2014. Second defendant appealed to Supreme Court by special leave. Supreme Court granted leave and dismissed both appeals on 31.07.2019.

Acts & Sections

  • U.P. Zamindari Abolition and Land Reforms Act, 1950: Section 331, Section 229B
  • Companies Act, 1956:
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Supreme Court Supreme Court Upholds Civil Court's Jurisdiction in Suit for Cancellation of Sale Deed on Ground of Fraud. Section 331 of U.P. Zamindari Abolition and Land Reforms Act, 1950 Does Not Bar Suit When Recorded Tenure Holder's Title Is Not Under Cloud.