Case Note & Summary
The Supreme Court dismissed an appeal against the High Court's order allowing impleadment of a purchaser (JCS) as plaintiff in a pending suit. The original owner MMT had sold land to the appellants through a power of attorney, which MMT and the attorney denied. MMT then sold the same land to JCS during the pendency of the suit challenging the first sale. JCS applied for impleadment under Order I Rule 10 CPC, but the trial court dismissed it, holding he was not a necessary party. The High Court reversed this, and the Supreme Court affirmed. The Court held that the application should have been under Order XXII Rule 10 CPC, which governs assignment of interest during suit. Since JCS had acquired MMT's rights, he was entitled to continue the suit. The subsequent withdrawal of the suit by MMT's legal heirs after a collusive settlement with the appellants did not affect JCS's rights, as the settlement did not create any title in favor of the appellants. The Court emphasized that the core issue—whether the power of attorney authorized the sale—could only be decided in the existing suit, not in a fresh suit. The appeal was dismissed with no order as to costs.
Headnote
A) Civil Procedure - Impleadment of Assignee - Order XXII Rule 10 CPC - Assignment of Interest - A person who acquires an interest in the subject matter of a suit during its pendency is entitled to be substituted or continued as a party under Order XXII Rule 10 CPC, even if the application is wrongly filed under Order I Rule 10 CPC, as mere non-mentioning of an incorrect provision is not fatal if the power exists. (Paras 7-9)
B) Civil Procedure - Withdrawal of Suit by Legal Heirs - Effect on Assignee's Rights - Where an assignee has acquired rights from the original plaintiff before the legal heirs withdraw the suit, the assignee's right to continue the suit is not affected by the withdrawal, especially if the withdrawal is collusive and does not create any title in favor of the defendants. (Paras 10-11)
C) Transfer of Property Act - Lis Pendens - Registration Requirement - Under the amendment to Section 52 of the Transfer of Property Act, 1882 applicable in Gujarat, a claim for lis pendens must be registered; failure to register may affect the applicability of the doctrine against a bona fide purchaser. (Para 6)
Issue of Consideration
Whether a purchaser of suit property during pendency of litigation is entitled to be impleaded as a plaintiff under Order XXII Rule 10 CPC, and whether the subsequent withdrawal of the suit by the legal heirs of the original plaintiff can defeat the rights of such purchaser.
Final Decision
The Supreme Court dismissed the appeal, upholding the High Court's order allowing JCS to be impleaded as plaintiff no. 2. The Court held that JCS, as an assignee of the original plaintiff's interest during pendency of the suit, is entitled to continue the suit under Order XXII Rule 10 CPC. The withdrawal of the suit by the legal heirs of MMT does not affect JCS's rights. Interim order dated 06.07.2009 stands vacated. Pending applications disposed of.
Law Points
- Order XXII Rule 10 CPC
- Order I Rule 10 CPC
- Section 52 Transfer of Property Act 1882
- lis pendens
- assignment of interest
- impleadment of assignee
- withdrawal of suit by legal heirs
- collusive settlement
Case Details
2019 LawText (SC) (10) 38
Civil Appeal No. 10521 of 2013
Deepak Gupta, Aniruddha Bose
D.N. Ray for appellants, Huzefa Ahmadi for respondents
Pruthvirajsinh Nodhubha Jadeja (D) By Lrs.
Jayeshkumar Chhakaddas Shah & Ors.
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Nature of Litigation
Civil appeal against High Court order allowing impleadment of a purchaser as plaintiff in a pending suit for declaration and cancellation of sale deed.
Remedy Sought
Appellants (defendants) sought to set aside the High Court order permitting respondent no. 1 (JCS) to be added as plaintiff no. 2 in the suit.
Filing Reason
JCS purchased the suit land from MMT during pendency of the suit and sought to be impleaded to protect his interest, as the legal heirs of MMT were allegedly colluding with the defendants.
Previous Decisions
Trial court dismissed JCS's impleadment application; High Court allowed it under Article 227 of the Constitution.
Issues
Whether JCS, as a purchaser of suit property during pendency of litigation, is entitled to be impleaded as a plaintiff under Order XXII Rule 10 CPC?
Whether the subsequent withdrawal of the suit by the legal heirs of the original plaintiff can defeat the rights of JCS?
Submissions/Arguments
Appellants: The application should have been under Order XXII Rule 10 CPC, not Order I Rule 10; plaintiff cannot be forced to add another plaintiff; JCS should file a separate suit.
Respondents: JCS is an assignee of MMT's rights and entitled to be substituted; there is no clash of interest; the legal heirs' withdrawal is collusive and does not affect JCS's rights.
Ratio Decidendi
A person who acquires an interest in the subject matter of a suit during its pendency by assignment, creation, or devolution is entitled to be substituted or continued as a party under Order XXII Rule 10 CPC. The subsequent withdrawal of the suit by the original plaintiff's legal heirs cannot defeat the rights of such assignee, especially when the withdrawal is collusive and does not create any title in favor of the defendants.
Judgment Excerpts
It is well settled law that mere non-mentioning of an incorrect provision is not fatal to the application if the power to pass such an order is available with the court.
MMT had assigned his rights and interest in the land in favour of JCS. Therefore, JCS as an assignee of the rights of the original plaintiff, had a right to be impleaded as a plaintiff in place of MMT.
We are prima facie of the view that JCS need not even challenge the so called settlement because that settlement does not, in any way, create any title, right or interest in the suit parties.
Procedural History
MMT filed Civil Suit No. 89 of 2006 challenging the sale to appellants. During pendency, MMT sold land to JCS on 23.03.2007. JCS filed impleadment application on 02.07.2007. MMT died on 02.06.2007; his legal heirs were brought on record. On 06.07.2007, legal heirs executed a declaration deed confirming the sale to appellants. On 19.07.2007, legal heirs filed Pursis to withdraw the suit. Trial court dismissed JCS's impleadment application. JCS filed petition under Article 227 before High Court, which allowed it on 26.03.2009. Appellants appealed to Supreme Court.
Acts & Sections
- Code of Civil Procedure, 1908: Order I Rule 10, Order XXII Rule 10
- Transfer of Property Act, 1882: Section 52
