Sanjay Kishan Kaul, J.@mdashThe appellant filed a suit for specific performance and permanent injunction on the Original Side of this Court, which was numbered as Suit No. 1377/1995, making the following prayers:
(a) pass a decree of Specific Performance in favor of the plaintiff and against the defendant in respect of an apartment in Neelanchal Apartments, Economy Type III, Pine Gardens, Nainital, developed by the defendant, together with the rights to the use of all common passages, entrances, terrace and any other common facilities and easements;
(b) by means of the said decree of Specific Performance, the defendant be directed to:
i. to apply and obtain all permissions from all Authorities, including under Income Tax Act, that will render marketable, free from all encumbrances, the title of the said property, which is the subject-matter of the present suit in favor of the plaintiff;
ii. intimate to the plaintiff of having obtained necessary permission by means of registered letters/notice.
iii. to execute and sign the Sale Deed, appear before the Registrar or Sub-Registrar, admit the execution of the sale and get the same registered and to receive the balance sale consideration amount;
iv. all other directions be issued to the defendant for effecting the sale of the suit property and for passing clean, marketable, free from all encumbrances, title, upto the plaintiffs.
(c) This Hon''ble Court may further observe in the decree and direct that in case the defendant fails to perform, neglects or otherwise becomes incapable of performing such acts and other directions as this Hon''ble Court deems fit and proper, then, it may kindly direct any officer of this Hon''ble Court to carry out all the aforesaid directions and to sign and execute proper Sale Deed for subject-matter of the present suit and accept the balance sale consideration.
(d) pass a decree of injunction permanently restraining the defendant from selling all the remaining flats/apartments in its Pine Gardens, Nainital and keep at least one flat/apartment reserved for the plaintiff till the disposal of this suit.
(e) cost of the suit be also awarded in favor of the plaintiff and against the defendant.
(f) Any other relief which this Hon''ble Court may deem fit and proper in the circumstances or the case may also be granted in favor of the plaintiff and against the defendant.
2. The plaint states that one of the employees of the respondent had visited the appellant in connection with the sale of an apartment in the complex which was being developed by the respondent in Nainital when a video tape of the site was shown to him. The appellant claims to have booked one flat on 15.1.1992 and handed over a cheque bearing No. 049748 drawn on Central Bank of India for Rs. 50,000.00 and another post dated cheque bearing No. 948459 dated 25.4.1992 drawn on State Bank of India for Rs. 15,000.00. The plaintiff claims that no documents were executed by the respondent in his favor despite lapse of three (3) years. Oral agreement is pleaded for one apartment in Neelanchal Type Economy III, having an area of 818 sq.ft. for a total price of Rs. 6,50,310.00. The respondent is stated to have acknowledged the receipt of the sum of Rs. 50,000.00 and the fact that the flat was to be a two bedroom unit. However, a larger area of 1076 sq.ft. was developed for which enhanced consideration of Rs. 8,55,420.00 was demanded. The appellant, however, wanted to adhere to the initial contract. The appellant came across an advertisement of the respondent in respect of sale of flats and on being contacted the respondent refused to execute any agreement and wanted the current prevailing market price.
3. The respondent moved an application under Order 7 Rule 11 of the Code of Civil Procedure, 1908 (hereinafter referred to as the "said Code"). The respondent pleaded that it is the appellant who resiled from his obligations and failed to pay the installments. The application is predicated on the plea of absence of territorial jurisdiction of the Delhi High Court apart from the issue of non-readiness and willingness of the appellant to perform his obligations. The property in suit being located at Nainital, it is pleaded that the courts at Nainital alone would have territorial jurisdiction to try & determine the suit.
4. The prayer made by the respondent was accepted and the application was allowed vide impugned order dated 23.2.1999. The impugned order proceeds on the reasoning that the appellant seeks a decree for specific performance of the contract and in view of provisions of Section 22 of the Specific Relief Act, 1963 (hereinafter referred to as the "SR Act"), the appellant is required to claim possession, or partition and separate possession, of the property, in addition to such performance in an appropriate case, if such relief has to be specifically claimed. Section 22 of the SR Act reads as under:
22. Power to grant relief for possession, partition, refund of earnest money, etc.-(1) Notwithstanding anything to the contrary contained in the Code of Civil Procedure, 1908 (5 of 1908), any person suing for the specific performance of a contract for the transfer of immovable property may, in an appropriate case, ask for-
(a) possession, or partition and separate possession, of the property, in addition to such performance; or
(b) any other relief to which he may be entitled, including the refund of any earnest money or deposit paid or [made by] him, in case his claim for specific performance is refused.
(2) No relief under clause (a) or clause (b) of sub-section (1) shall be granted by the court unless it has been specifically claimed:
Provided that where the plaintiff has not claimed any such relief in the plaint, the court shall, at any stage of the proceeding, allow him to amend the plaint on such terms as may be just for including a claim for such relief.
(3) The power of the court to grant relief under clause (b) of sub-section (1) shall be without prejudice to its powers to award compensation u/s 21.23.Liquidation of damages not a bar to specific performance.
5. The impugned order relies upon the judgement of the Supreme Court in
6. The impugned order concludes that in a case where possession of the immovable property is vested with the vendor, even if no decree for possession is sought for in the plaint, in a suit for specific performance of a contract the Court shall have the power to grant a decree for possession of the immovable property in favor of the plaintiff and against the defendant besides granting the relief for specific performance. The plea of the learned counsel for the appellant that the claim was only for a decree of specific performance and not for possession of immovable property has not been accepted since though the suit has been framed as a suit for specific performance of the contract, a further declaration is sought for transfer of property in question in favor of the appellant thereby seeking a decree of possession as well. Such relief for possession has been held to be inherent in the relief for specific performance of the contract in view of Section 55(1) of the Transfer of Property Act, 1882.
7. The effect of the provisions of Section 16 of the said Code have also been analyzed. The said provision reads as under:
16. Suits to be instituted where subject-matter situate. - Subject to the pecuniary or other limitations prescribed by any law, suits-
(a) for the recovery of immovable property with or without rent or profits,
(b) for the partition of immovable property,
(c) for foreclosure, sale or redemption in the case of a mortgage of or charge upon immovable property,
(d) for the determination of any other right to or interest in immovable property,
(e) for compensation for wrong to immovable property,
(f) for the recovery of movable property actually under distraint or attachment,
shall be instituted in the Court within the local limits of whose jurisdiction the property is situate : Provided that a suit to obtain relief respecting, or compensation for wrong to, immovable property held by or on behalf of the defendant, may where the relief sought can be entirely obtained through his personal obedience be instituted either in the Court within the local limits of whose jurisdiction the property is situate, or in the Court within the local limits of whose jurisdiction the defendant actually and voluntarily resides, or carries on business, or personally works for gain.
8. The learned single Judge has found that clause (d) of Section 16 of the said Code would apply in the present case as the property is situated in Nainital and that the proviso would not come to the aid of the appellant as the relief in the suit cannot be said to be entirely obtainable through personal obedience of the defendant. Even after the execution of the sale deed, the possession would be handed over to the appellant by the respondent only by going to Nainital.
9. The aforesaid order of the learned single Judge has now been assailed in the appeal.
10. The basic plea as canvassed by learned counsel for the appellant was that the nature of the suit in the present case was not a suit for land as the relief was only for specific performance simplicitor without the relief of possession and, thus, Section 16 of the said Code would not apply, but Section 20 of the said Code would be applicable. To buttress his submissions, learned counsel strongly relied upon the judgment in
13. Now, Sections 15 to 20 of the Code contain detailed provisions relating to jurisdiction of courts. They regulate forum for institution of suits. They deal with the matters of domestic concern and provide for the multitude of suits which can be brought in different courts. Section 15 requires the suitor to institute a suit in the court of the lowest grade competent to try it. Section 16 enacts that the suits for recovery of immovable property, or for partition of immovable property, or for foreclosure, sale or redemption of mortgage property, or for determination of any other right or interest in immovable property, or for compensation for wrong to immovable property shall be instituted in the court within the local limits of whose jurisdiction the property is situate. Proviso to Section 16 declares that where the relief sought can be obtained through the personal obedience of the defendant, the suit can be instituted either in the court within whose jurisdiction the property is situate or in the court where the defendant actually or voluntarily resides, or carries on business, or personally works for gain. Section 17 supplements Section 16 and is virtually another proviso to that section. It deals with those cases where immovable property is situate within the jurisdiction of different courts. Section 18 applies where local limits of jurisdiction of different courts is uncertain. Section 19 is a special provision and applies to suits for compensation for wrongs to a person or to movable property. Section 20 is a residuary section and covers all those cases not dealt with or covered by Sections 15 to 19.
14. Section 16 thus recognizes a well established principle that actions against res or property should be brought in the forum where such res is situate. A court within whose territorial jurisdiction the property is not situate has no power to deal with and decide the rights or interests in such property. In other words, a court has no jurisdiction over a dispute in which it cannot give an effective judgment. Proviso to Section 16, no doubt, states that though the court cannot, in case of immovable property situate beyond jurisdiction, grant a relief in rem still it can entertain a suit where relief sought can be obtained through the personal obedience of the defendant. The proviso is based on well known maxim "equity acts in personam, recognized by Chancery Courts in England. Equity Courts had jurisdiction to entertain certain suits respecting immovable properties situated abroad through personal obedience of the defendant. The principle on which the maxim was based was that courts could grant relief in suits respecting immovable property situate abroad by enforcing their judgments by process in personam, i.e. by arrest of defendant or by attachment of his property.
15. In Ewing v. Ewing, (1883) 9 AC 34 : 53 LJ Ch 435, Lord Selborne observed :
The Courts of Equity in England are, and always have been, courts of conscience operating in personam and not in rem; and in the exercise of this personal jurisdiction they have always been accustomed to compel the performance of contracts in trusts as to subjects which were not either locally or ratione domicilli within their jurisdiction. They have done so, as to land, in Scotland, in Ireland, in the Colonies, in foreign countries.
16. The proviso is thus an exception to the main part of the section which in our considered opinion, cannot be interpreted or construed to enlarge the scope of the principal provision. It would apply only if the suit falls within one of the categories specified in the main part of the section and the relief sought could entirely be obtained by personal obedience of the defendant.
17. In the instant case, the proviso has no application. The relief sought by the plaintiff is for specific performance of agreement respecting immovable property by directing the defendant No. 1 to execute sale-deed in favor of the plaintiff and to deliver possession to him. The trial court was, therefore, right in holding that the suit was covered by Clause (d) of Section 16 of the Code and the proviso had no application.
18. In our opinion, the submission of the learned counsel for the appellant that the parties had agreed that Delhi Court alone had jurisdiction in the matters arising out of the transaction has also no force. Such a provision, in our opinion, would apply to those cases where two or more courts have jurisdiction to entertain a suit and the parties have agreed to submit to the jurisdiction of one court.
11. Learned counsel for the appellant, thus, sought to distinguish the judgment in
12. The effect of the aforesaid two judgments had been considered by one of us (Sanjay Kishan Kaul, J.) in
13. It is appropriate for us to notice that while delivering the judgment in Bhawna Seth''s case (supra), one of the judgments considered to support the view was of Rohit Kochhar v. Vipul Infrastructure Developers Ltd., 122 (2005) DLT 480. This judgment has been subsequently set aside in Vipul Infrastructure Developers Ltd. & Anr. v. Rohit Kochhar & Anr., 2008 IV AD (Delhi) 63. However, against the Order of the Division Bench, a Special Leave to Appeal (Civil) Nos. 10169-10171/2008 titled Rohit Kochhar v. Vipul Infrastructure Developers Ltd. & Ors. was filed before the Supreme Court and in terms of the Order dated 28.04.2008, notice was issued and interim orders were granted that no third-party right would be created. On 19.02.2010, the matter was directed to be listed for final disposal with interim orders to continue. We are, however, informed that this appeal is still pending consideration.
14. We may note the submission of learned counsel for the appellant that the relief of possession is not inherent in the relief of specific performance as held in Bhawna Seth''s case (supra). The pronouncements to the contrary were prior to the law propounded in Adcon Electronics Pvt. Ltd.''s case (supra) that in a suit for specific performance, the relief of possession is intrinsic. Thus, it has been held that the judgment in Adcon Electronics Pvt. Ltd.''s case (supra) and Harshad Chiman Lal Modi''s case (supra) operate in different factual matrix. It was submitted that the proviso to Section 16 of the said Code would come into play where a relief can be obtained through personal obedience of the defendant, which is based on the well-known maxim "equity acts in personam" recognized by Chancery Courts in England.
15. The pleas of learned senior counsel for the respondent are really on alternative submissions. The initial plea is that the bar of Section 16 of the said Code was fully attracted and that the judgment of Adcon Electronics Pvt. Ltd.''s case (supra) would only apply within the scope of clause 10 of the Letters Patent of the Bombay High Court, which is not so in the present case. The fact that Bhawna Seth''s case (supra) relied upon Rohit Kochhar''s case (supra), which had been reversed by the Division Bench, was also plea advanced. But then, it was accepted that Rohit Kochhar''s case (supra) has gone to the Supreme Court where interim orders were operating. The alternative plea was that in the given factual matrix, the plaint could not be said to be one claiming the relief of specific performance simplicitor as rights of usage of common passages, entrances, terrace, common facilities and easements had also been sought, which were in the nature of possession. Further, all permissions were required to be obtained at Nainital for which relief had been claimed.
16. We are in a legally fluid situation on the basic plea of a distinction between a suit for specific performance simplicitor and a suit where the relief for possession is also claimed. It is our view that the principles set out in Adcon Electronics Pvt. Ltd.''s case (supra) would come into play where no relief of possession was claimed. The field of the factual matrix would be material to determine whether the principles of Adcon Electronics Pvt. Ltd.''s case (supra) would come into play or not. But then in Vipul Infrastructure Developers Ltd.''s case (supra), a co-ordinate Bench of this Court had taken a different view without specifically discussing this aspect. The matter is little more complicated arising out of the pendency of the SLP against that Order of the Division Bench where interim orders are operating.
17. We, however, do not consider it necessary to refer this issue to a larger Bench or await the judgment of the Supreme Court for the reasons set out hereinafter.
18. It is our view that the plaint as framed in the present case is not a suit filed simplicitor for specific performance without any relief of possession. The relief of possession has, in fact, been claimed albeit by not stating so in so many words. Thus, the appellant cannot avail of the benefit of the principles set out in Adcon Electronics Pvt. Ltd.''s case (supra) to file the suit in Delhi by claiming that it is merely a suit for specific performance and the reliefs as claimed can be enforced by the personal obedience of the defendant.
19. The reason for us to come to such a conclusion is based on the manner of reliefs claimed. We have already reproduced the prayer clause above. The first prayer being clause (a) is for specific performance in respect of the apartment, but "together with the rights to use of all common passages, entrance, terrace and any other common facilities and easements". The appellant is clearly seeking the use and enjoyment of these common areas, which can only be available if there is common possession of the appellant over these areas. It, thus, does not lie in the mouth of the appellant to claim that possessory reliefs are completely absent. We may note that the appellant has claimed the relief in prayer clause (b) for necessary permissions to be obtained from authorities and sale deed to be registered with the clean marketable title, but the material aspect as observed by us aforesaid is possessory reliefs have been claimed as part of prayer clause (a).
20. In view of the aforesaid factual position, the plaint as framed cannot be maintained at Delhi and, thus, the operative portion of the impugned order dated 23.02.1999 is sustained albeit for reasons different to that, which are recorded in the impugned order.
21. The plaint may, thus, be returned to the counsel for the appellant to be presented in accordance with law to the court of competent territorial jurisdiction.
22. The appeal is accordingly dismissed leaving the parties to bear their own costs.
