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CASE NO.: Appeal (civil)  3460 of 2000

PETITIONER: Popat and Kotecha Property                               

RESPONDENT: State Bank of India Staff Association            

DATE OF JUDGMENT: 29/08/2005

BENCH: ARIJIT PASAYAT & H.K. SEMA

JUDGMENT: J U D G M E N T

ARIJIT PASAYAT, J.  

       Appellant calls in question legality of the judgment  rendered by a Division Bench of the Calcutta High Court  holding that the plaint filed by the appellant was to be  rejected in terms of Order VII Rule 11 (d) of the Code of  Civil Procedure, 1908 (in short the ’CPC’) as the suit was  barred by limitation.  The order passed by learned Single  Judge holding that said provision was not applicable to the  facts of the case was set aside.   

       Factual position in a nutshell is as follows:

       Appellant and respondent entered into an agreement on  19th January, 1983 whereby the appellant agreed to build and  develop the property owned by the respondent-Association. A  detailed agreement was accordingly executed on 19th January,  1983 which, inter alia, provided for regulating relationship  between the parties.  Para 13 of the agreement stipulated  that after construction of the entire building and issuance  of final completion certificate by two Chartered Engineers  the appellant shall by a notice to the respondent- Association call upon it to execute a registered lease deed  in its favour or in favour of its nominee whereby a lease of  the 2nd floor, 3rd floor, 4th floor, 5th floor and the roof   (collectively described as the demised premises) was to be  granted.  Several stipulations were provided in detail. It  is not in dispute that the building was completed in the  year 1984.  Appellant claimed to have written a letter dated  4.11.1984 calling upon the respondent to execute the lease  deed in its favour. Admittedly no lease deed has been  executed.  The suit was filed in July, 1990, inter alia,  with the following prayers:

"(a)    Declaration that the plaintiff alone is  entitled to let out the ground floor, 2nd,  3rd, 4th, 5th floor and the roof of the said  premises shortly referred to have as the  ’Builders Block’ and realize all rents,  issues and profits therefrom without any  interference by the defendant. (b)     Perpetual injunction restraining the  defendant from executing any lease or other  documents in favour of persons in occupation  of any portion of the builders block referred  to in prayers (a) or in relation to any part  or portion of the said block in consideration

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of any sum or from realizing any rent issues  or profit therefrom incumbent or otherwise  deal with and exercise any control or  dominance over the same; (c)     Decree for Rs.18,84,500/- (Rupees  Eighteen lacs eighty four thousand five  hundred) only as pleaded in paragraphs 18 and  25 of the plaint. (d)     Alternatively, an account of what is due  and payable to the plaintiff by the defendant  in respect of all dealings and transactions  by the defendant with the person or persons  in occupation of the builders block of the  said premises and a decree for such sum as  may be found due and payable after taking  such account; (e)     All further proper accounts enquiries  and directions; (f)     Decree for specific performance of the  Development Agreement dated 19th January,  1983 be granted against the defendant in  terms of Clause 16 of the said Agreement  requiring the defendant to execute Deed of  Lease for a period of 51 years on terms and  conditions contained in the said Clause; (g)     Mandatory injunction directing the  defendant to execute and register a Deed of  Lease, in favour of the plaintiff and/or its  nominee or nominees in terms of Clause 18 of  the Development Agreement dated 19th January,  1983 in respect of the Builders Block, being  the 2nd, 3rd, 4th, 5th floor and roof as  referred to above; (h)     In the event of the defendant failing to  execute, register and deliver Deed of Lease,  the Registrar, Original Side of this Hon’ble  Court be directed to settle execute and  register necessary Deed of Lease in respect  of the Builders Block as referred to above  for and on behalf of the defendant. (i)     Decree for Rs.80 lacs as damages as  mentioned in paragraph 12 above in addition  to a decree for specific performance; (j)     Alternatively, an enquiry, into loss and  damage suffered by the plaintiff and a decree  for such sum as may be found due and payable  upon such enquiry; (k)     In the event decree for specific  performance as prayed for cannot be granted,  a decree for damages in terms of specific  performance be granted against the defendant  at such rate or rates and on such basis as  this Hon’ble Court may deem fit and proper; (l)     Costs; (m)     Further or other reliefs."

       An application was filed by the respondent under Order  VII Rule 11 of CPC praying for rejection of the plaint on  the ground that the suit as is apparent from the statement  contained in the plaint itself was barred by limitation in  the sense that the suit was filed beyond the period  prescribed in the Indian Limitation Act, 1963 (in short  ’Limitation Act’).

       Learned Single Judge dismissed the application holding

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that the expression "barred by any law" as occurring in  the provision did not include the operation of the  Limitation Act.  The Division Bench was of the view that the  claims made in the plaint revolve round the nucleus i.e.  focal point of the execution of lease deed which was to be  done sometimes in 1985 and as the suit was filed in 1999, it  was clearly barred by limitation.   

       Learned counsel for the appellant submitted that the  approach of the Division Bench is clearly erroneous. The  High Court proceeded on the basis as if the only claim  related to execution of the lease deed. In fact, there were  several other reliefs like claim for damages, unauthorized  collection of amounts in respect of the building which  admittedly were to be in possession of the present appellant  with full liberty to let out the premises.  Clause 12 of the  agreement clearly stipulated that the appellant had the  authority to let out the building without any objection and  without requiring consent from the respondent-Association.   The Receiver appointed by the Court on the interlocutory  application filed by the applicant clearly noted that the  defendant i.e. the respondent-Association had executed lease  deeds on 3.4.1988, 16.7.1988 and 19.4.1999. Prayer in the  plaint was to pass a decree of Rs.18,84,500/- which was the  amount collected by the respondent. The suit was by no  stretch of imagination filed beyond the period of  limitation.  By its conduct the respondent had acknowledged  the claim of the plaintiff-appellant and the period of  limitation in any event would run from the date of  acknowledgement.

       Per contra, learned counsel for the respondent  submitted that though various claims were made, as rightly  observed by the High Court, focal point was non-execution of  lease deed.  All the other claims had their matrix thereon  and, therefore, the Division Bench of the High Court was  right in deciding in favour of the present respondent.  It  was submitted that the collections made by the respondent  were for the period beyond 51 years from the date of  agreement in 1983 and not for any period prior to that.   There was no question of the period of limitation getting  extended, even if there is an acknowledgment beyond the  prescribed period of limitation.

        The period of limitation is founded on public policy,  its aim being to secure the quiet of the community, to  suppress fraud and perjury, to quicken diligence and to  prevent oppression. The statute i.e. Limitation Act is  founded on the most salutary principle of general and public  policy and incorporates a principle of great benefit to the  community.  It has, with great propriety, been termed a  statute of repose, peace and justice. The statute  discourages litigation by burying in one common receptacle  all the accumulations of past times which are unexplained  and have not from lapse of time become inexplicable. It has  been said by John Voet, with singular felicity, that  controversies are limited to a fixed period of time, lest  they should be immortal while men are mortal. ( Also See  France B. Martins v. Mafalda Maria (1996 (6) SCC 627).

       Bar of limitation does not obstruct the execution. It  bars the remedy. (See V. Subba Rao and Ors. v. Secretary to  Govt. Panchayat Raj and Rural Development, Govt. of A.P. and  Ors. (1996 (7) SCC 626.)

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       Rules of limitation are not meant to destroy the rights  of parties. They are meant to see that parties do not resort  to dilatory tactics, but seek their remedy promptly. The  object of providing a legal remedy is to repair the damage  caused by reason of legal injury. The law of limitation  fixes a life-span for such legal remedy for the redress of  the legal injury so suffered. Time is precious and wasted  time would never revisit. During the efflux of time, newer  causes would sprout up necessitating newer persons to seek  legal remedy by approaching the courts. So, a life-span must  be fixed for each remedy. Unending period for launching the  remedy may lead to unending uncertainty and consequential  anarchy. The law of limitation is thus founded on public  policy.  It is enshrined in the maxim interest reipublicae  ut sit finis litium (it is for the general welfare that a  period be put to litigation). The idea is that every legal  remedy must be kept alive for legislatively fixed period of  time.  (See N. Balakrishanan v. M. Krishna Murthy (1998 (7)  SCC 123).               Clause (d) of Order VII 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 VII Rule 11  CPC.  Clause (d) of Rule 11 of Order VII 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.

       Order VII Rule 11 of the Code reads as follows:

Order VII Rule 11: Rejection of plaint. \026 The  plaint shall be rejected in the following  cases :-

(a)     where it does not disclose a cause of  action;

(b)     where the relief claimed is undervalued,  and the plaintiff, on being required by the  Court to correct the valuation within a time  to be fixed by the court, fails to do so;

(c)     where the relief claims is properly  valued but the plaint is written upon paper  insufficiently stamped, and the plaintiff, on  being required by the Court to supply the  requisite stamp-paper within a time to be  fixed by the Court, fails to do so;

(d)     where the suit appears from the  statement in the plaint to be barred by any  law;

(e)     where it is not filed in duplicate;

(f)     where the plaintiff fails to comply with  the provisions of rule 9.

       Provided that the time fixed by the  Court for the correction of the valuation or  supplying of the requisite stamp-paper shall  not be extended unless the Court, for reasons  to be recorded, is satisfied that the  plaintiff was prevented by any cause of an

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exceptional nature for correcting the  valuation or supplying the requisite stamp- paper, as the case may be, within the time  fixed by the Court and that refusal to extend  such time would cause grave injustice to the  plaintiff."                             In the present case the respondent has relied upon  clause (d) of Rule 11.  

       Before dealing with the factual scenario, the spectrum  of Order VII Rule 11 in the legal ambit needs to be noted.           In Saleem Bhai and Ors. v. State of Maharashtra and  Ors. (2003 (1) SCC 557) it was held with reference to Order  VII Rule 11 of the Code that the relevant facts which need  to be looked into for deciding an application thereunder are  the averments in the plaint. The trial Court can exercise  the power at any stage of the suit - before registering the  plaint or after issuing summons to the defendant at any time  before the conclusion of the trial. For the purposes of  deciding an application under clauses (a) and (d) of Order  VII Rule 11 of the Code, the averments in the plaint are the  germane; the pleas taken by the defendant in the written  statement would be wholly irrelevant at that stage.

       In I.T.C. Ltd. v. Debts Recovery Appellate Tribunal and  Ors. (1998 (2) SCC 70) it was held that the basic question  to be decided while dealing with an application filed under  Order VII Rule 11 of the Code is whether a real cause of  action has been set out in the plaint or something purely  illusory has been stated with a view to get out of Order VII  Rule 11 of the Code.

       The trial Court must remember that if on a meaningful  and not formal reading of the plaint it is manifestly  vexatious and meritless in the sense of not disclosing a  clear right to sue, it should exercise the power under Order  VII Rule 11 of the Code taking care to see that the ground  mentioned therein is fulfilled. If clever drafting has  created the illusion of a cause of action, it has to be  nipped in the bud at the first hearing by examining the  party searchingly under Order X of the Code. (See T.  Arivandandam v. T.V. Satyapal and Anr. (1977 (4) SCC 467)

       It is trite law that not any particular plea has to be  considered, and the whole plaint has to be read. As was  observed by this Court in Roop Lal Sathi v. Nachhattar Singh  Gill (1982 (3) SCC 487), only a part of the plaint cannot be  rejected and if no cause of action is disclosed, the plaint  as a whole must be rejected.

       In Raptakos Brett & Co. Ltd. v. Ganesh Property (1998  (7) SCC 184) it was observed that the averments in the  plaint as a whole have to be seen to find out whether clause  (d) of Rule 11 of Order VII was applicable.  

       There cannot be any compartmentalization, dissection,  segregation and inversions of the language of various  paragraphs in the plaint. If such a course is adopted it  would run counter to the cardinal canon of interpretation  according to which a pleading has to be read as a whole to  ascertain its true import. It is not permissible to cull out  a sentence or a passage and to read it out of the context in  isolation. Although it is the substance and not merely the

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form that has to be looked into, the pleading has to be  construed as it stands without addition or subtraction of  words or change of its apparent grammatical sense. The  intention of the party concerned is to be gathered primarily  from the tenor and terms of his pleadings taken as a whole.  At the same time it should be borne in mind that no pedantic  approach should be adopted to defeat justice on hair- splitting technicalities.  

       Keeping in view the aforesaid principles the reliefs  sought for in the suit as quoted supra have to be  considered. The real object of Order VII Rule 11 of the Code  is to keep out of courts irresponsible law suits. Therefore,  the Order X of the Code is a tool in the hands of the Courts  by resorting to which and by searching examination of the  party in case the Court is prima facie of the view that the  suit is an abuse of the process of the court in the sense  that it is a bogus and irresponsible litigation, the  jurisdiction under Order VII Rule 11 of the Code can be  exercised.  

       Order VI Rule 2(1) of the Code states the basic and  cardinal rule of pleadings and declares that the pleading  has to state material facts and not the evidence. It  mandates that every pleading shall contain, and contain  only, a statement in a concise form of the material facts on  which the party pleading relies for his claim or defence, as  the case may be, but not the evidence by which they are to  be proved.  

       There is distinction between ’material facts’ and  ’particulars’. The words ’material facts’ show that the  facts necessary to formulate a complete cause of action must  be stated. Omission of a single material fact leads to an  incomplete cause of action and the statement or plaint  becomes bad. The distinction which has been made between  ’material facts’ and ’particulars’ was brought by Scott,  L.J. in Bruce v. Odhams Press Ltd. (1936) 1 KB 697 in the  following passage:

       Rule 11 of Order VII lays down an independent remedy  made available to the defendant to challenge the  maintainability of the suit itself, irrespective of his  right to contest the same on merits. The law ostensibly does  not contemplate at any stage when the objections can be  raised, and also does not say in express terms about the  filing of a written statement. Instead, the word ’shall’ is  used clearly implying thereby that it casts a duty on the  Court to perform its obligations in rejecting the plaint  when the same is hit by any of the infirmities provided in  the four clauses of Rule 11, even without intervention of  the defendant. In any event, rejection of the plaint under  Rule 11 does not preclude the plaintiffs from presenting a  fresh plaint in terms of Rule 13.

       The above position was highlighted in Sopan Sukhdeo  Sable and Ors. v. Assistant Charity Commissioner and Ors.  (2004 (3) SCC 137).                          

       When the averments in the plaint are considered in the  background of the principles set out in Sopan Sukhdeo’s case  (supra), the inevitable conclusion is that the Division  Bench was not right in holding that Order VII Rule 11 CPC  was applicable to the facts of the case.  Diverse claims  were made and the Division Bench was wrong in proceeding

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with the assumption that only the non-execution of lease  deed was the basic issue.  Even if it is accepted that the  other claims were relatable to it they have independent  existence.  Whether the collection of amounts by the  respondent was for a period beyond 51 years need evidence to  be adduced. It is not a case where the suit from statement  in the plaint can be said to be barred by law.  The  statement in the plaint without addition or subtraction must  show that is barred by any law to attract application of  Order VII Rule 11.  This is not so in the present case.   

       We do not intend to go into various claims in detail as  disputed questions in relation to the issue of limitation  are involved.  

       The appeal is accordingly allowed with no order as to  costs. We make it clear that we have not expressed any  opinion on the merits of the case which shall be gone into  in accordance with law by the Trial Court.