Summary
A suit for specific performance of an agreement to sell commercial space in Gurugram falls under Section 16(d) CPC and must be filed where the property is situated, even if possession is not expressly prayed for. Conveyance needs a sale deed registered at Gurugram, so the relief cannot be obtained entirely through the defendants' personal obedience in Delhi, and the proviso to Section 16 does not apply. The return of the plaint by the Delhi High Court was upheld.
Issues
- Whether a suit for specific performance of an agreement to sell immovable property situated outside Delhi, without an express prayer for possession, could be entertained by the Delhi High Court under the proviso to Section 16 CPC because the defendants carried on business in Delhi.
- Whether the relief claimed could be entirely obtained through the personal obedience of the defendants.
- Whether Adcon Electronics v. Daulat helped the plaintiff, given Babu Lal v. Hazari Lal Kishori Lal and Sections 22 and 28 of the Specific Relief Act, 1963.
Provisions considered
- Section 16(d) and proviso, Code of Civil Procedure, 1908A suit for determining a right to or interest in immovable property must be filed where the property lies. The proviso allows filing where the defendant resides or carries on business only if the relief can be entirely obtained through his personal obedience. Because the defendants would have to go to Gurugram to execute and register the sale deed, the proviso did not apply and the suit fell under clause (d). (¶¶ 14, 15, 16, 17, 18, 20, 21, 33)
- Sections 22 and 28(3), Specific Relief Act, 1963Section 22 lets a plaintiff seeking specific performance also claim possession or partition in an appropriate case, and the plaint may be amended at any stage to add that claim. Read with Section 28(3), as explained in Babu Lal, delivery of possession is incidental to a decree for specific performance. (¶¶ 22, 23, 27, 29, 32)
- Section 55(1)(f), Transfer of Property Act, 1882The seller must give the buyer possession on being required to, so transfer of possession is implicit in a sale. This, together with the contract's term that possession would be handed over on payment of the last 5%, showed the suit concerned an interest in immovable property. (¶¶ 23, 32, 33)
- Section 17, Registration Act, 1908Following Babasaheb Dhondiba Kute, a sale conveys title only on registration of the sale deed, which would have to take place at Gurugram where the property is situated. (¶¶ 19, 20)
Held
- Section 16 CPC reflects the principle that actions concerning property must be brought where the property is situated. A court with no territorial jurisdiction over the property cannot give an effective judgment on it, and parties cannot confer that jurisdiction by agreement. The proviso is based on the maxim that equity acts in personam. (¶¶ 16, 17, 18)
- Even a decree for specific performance that does not provide for possession can be enforced only by directing the defendants to execute and register a sale deed, because title passes only on registration. Registration here would have to take place in Gurugram, so the defendants would have to leave Delhi. The relief therefore cannot be obtained entirely through their personal obedience, and the proviso to Section 16 is inapplicable. (¶¶ 19, 20, 21)
- Adcon Electronics did not consider Babu Lal and relied on Moolji Jaitha, decided under the old Specific Relief Act. Babu Lal took account of Sections 22 and 28 of the 1963 Act, which allow possession to be sought along with specific performance. (¶¶ 28, 29)
- In any event, Adcon Electronics itself requires the nature of a suit to be found from the plaint as a whole. The absence of a specific prayer is not decisive. (¶¶ 30, 31)
- The contract provided for possession to be handed over on payment of the final 5% of the price, and Section 55(1)(f) of the Transfer of Property Act obliges the seller to deliver possession. Transfer of possession was therefore implicit, and the omission of a prayer for possession did not change the character of the suit, which falls under Section 16(d) CPC. (¶¶ 32, 33)
- A contrary view would allow a plaintiff to sue for specific performance simpliciter in a distant forum, then transfer execution to the court where the property lies and amend to add possession. An interpretation open to such misuse cannot be accepted. (¶ 34)
Result
Special leave petitions dismissed; the Division Bench order returning the plaint upheld. Interim relief vacated, and the plaintiff left free to present the plaint before the court of competent jurisdiction.