HIGH COURT OF JUDICATURE AT ALLAHABAD A.F.R. Court No. - 19 Case :- MATTERS UNDER ARTICLE 227 No. - 8839 of 2017 Petitioner :- [ENTITY] And Another Respondent :- [ENTITY] And 12 Others Counsel for Petitioner :- [ENTITY],[ENTITY] Counsel for Respondent :- [ENTITY] Hon'ble [ENTITY],J.
The instant petition is directed against the order dated 11.10.2017 passed by District Judge, Jaunpur dismissing [CASE NUMBER] and the order dated 20.10.2016 passed by Additional Civil Judge (Senior Division), First, Jaunpur allowing an application 55 Ka filed by respondent no.13 seeking impleadment as a party defendant. The trial court has entered a specific finding in the impugned order that the suit property 113 Kha is minjumla number of plot no.113, which according to the revenue records is still joint. [ENTITY], who filed the application for impleadment, has purchased the share of [ENTITY], one of the defendants in the suit, by registered sale deed dated 3.9.2013. It has also been observed that in respect of house no.7, which lies over the disputed land, which the plaintiff-petitioners claim to be their property, name of [ENTITY] stands recorded vide Paper No.38 Ga. Having regard to these facts, the trial court has held that presence of [ENTITY] in the suit, wherein prohibitory injunction has been sought restraining the defendants from interfering in the right of the plaintiffs to raise construction over the suit property, would be necessary, as in her absence it would be difficult to determine the real matter in dispute in the suit. The order passed by the trial court has been affirmed by the revisional court.
Counsel for the petitioners submitted that the trial court is not invested with power to allow impleadment under [SECTION] [ACT]. According to him, in case a party has purchased suit property during pendency of the suit, the impleadment could be directed under [SECTION] [ACT] and not under [SECTION] [ACT]. In support of his contention, he has placed reliance on a judgment of this Court in [PRECEDENT].
Per contra, learned counsel for respondent No.13 [ENTITY] submitted that she being assignee of the interest of defendant during pendency of the suit was rightly allowed to be added as a party defendant. He submitted that the power could be exercised under [SECTION] [ACT] and also under [SECTION] [ACT]. It is further urged that even if the power to permit impleadment is vested under [SECTION] [ACT] but the court has referred to [SECTION] [ACT], it would not render the order illegal. He has placed reliance on the judgments of the Supreme Court in [PRECEDENT], [PRECEDENT] and [PRECEDENT].
I have considered the submissions made by learned counsel for the parties and perused the material on record.
Although the petitioner has pleaded that partition had taken place between the co-sharers in respect of the suit property, but the trial court in the impugned order, placing reliance on CH Form 41 and 45, has entered a specific finding that the holding as per revenue records is still joint. It is not disputed that [ENTITY], the vendor of [ENTITY] was a party defendant in the suit. He has transferred his entire interest in the holding in favour of [ENTITY] by registered sale deed dated 3.9.2013 i.e. during the pendency of the suit. The other crucial finding recorded by the trial court is that house no.7 built over it stands recorded in the name of [ENTITY] also as per Paper No.68 Ga. It is noteworthy that the plaintiff-petitioners themselves had purchased the suit property from the original plaintiff [ENTITY] by registered sale deed dated 25.10.2012 i.e. during the pendency of the suit and thereafter got themselves impleaded as plaintiffs.
In [PRECEDENT] (supra), the Supreme Court considered the issue as to whether an assignee of interest of defendant in a suit for specific performance is entitled to be substituted. In that case, the plaintiff opposed the impleadment of transferee lis pendens by placing reliance on [SECTION] of the [ACT] as well as [SECTION] of the [ACT]. Hon. [ENTITY] J. in the leading judgement, after examining these provisions, held that though a person purchasing interest of the defendant during pendency of the suit for specific performance cannot be held to be a bonafide purchaser without notice, but he is definitely a necessary party, by observing thus:-
"37. Taking into consideration all these facts, we have no hesitation in holding that the appellant entered into a clandestine transaction with the defendants [ENTITY] and got the property transferred in their favour. Hence the appellant M/s Thomson Press cannot be held to be a bona fide purchaser, without notice.
39. As discussed above, a decree for specific performance of a contract may be enforced against a person claimed who under the plaintiff (sic defendant), and title acquired subsequent to the contract. There is no dispute that such transfer made in favour of the subsequent purchaser is subject to the rider provided under [SECTION] of the [ACT] and the restraint order passed by the Court.
43. This Court again in the case of [PRECEDENT] subscribed to its earlier view and held that in a suit for specific performance against a person with notice of a prior agreement of sale is a necessary party.
44. Having regard to the law discussed hereinabove and in the facts and circumstances of the case and also for the ends of justice the appellant is to be added as party-defendant in the suit. The appeal is, accordingly, allowed and the impugned orders passed by the High Court are set aside."
Hon'ble [ENTITY], J. while concurring with the view of Hon. [ENTITY], J, in his separate judgment, observed thus:-
49. The second aspect which the proposed judgment succinctly deals with is the effect of a sale pendete lite. The legal position in this regard is also fairly well settled. A transfer pendete lite is not illegal ipso jure but remains subservient to the pending litigation. In [PRECEDENT] this Court while interpreting [SECTION] of the [ACT] observed:
"25 the words 'so as to affect the rights of any other party thereto under any decree or order which may be made therein', make it clear that the transfer is good except to the extent that it might conflict with rights decreed under the decree or order. It is in this view that transfers pendente lite have been held to be valid and operative as between the parties thereto."
50. To the same effect is the decision of this Court in [PRECEDENT] where this Court held that [SECTION] does not render transfers affected during the pendency of the suit void but only render such transfers subservient to the rights as may be eventually determined by the Court. The following passage in this regard is apposite:
"42. It is well settled that the doctrine of lis pendens does not annul the conveyance by a party to the suit, but only renders it subservient to the rights of the other parties to the litigation. [SECTION] will not therefore render a transaction relating to the suit property during the pendency of the suit void but render the transfer inoperative insofar as the other parties to the suit. Transfer of any right, title or interest in the suit property or the consequential acquisition of any right, title or interest, during the pendency of the suit will be subject to the decision in the suit."
51. The decision of this Court in [PRECEDENT] is a recent reminder of the principle of law enunciated in the earlier decisions. This Court in that case summed up the legal position thus:
"18 '12. The mere pendency of a suit does not prevent one of the parties from dealing with the property constituting the subject-matter of the suit. The section only postulates a condition that the alienation will in no manner affect the rights of the other party under any decree which may be passed in the suit unless the property was alienated with the permission of the court."
52. We may finally refer to the decision of this Court in [PRECEDENT] in which were extracted with approval observations made on the doctrine of lis pendens in "Commentaries on the Laws of Scotland, by [ENTITY]. This Court said:
"43 [ENTITY], in his commentaries on the Laws of Scotland said that it was grounded on the maxim: "Pendente lite nibil innovandum". He observed:
It is a general rule which seems to have been recognised in all regular systems of jurisprudence, that during the pendence of an action, of which the object is to vest the property or obtain the possession of real estate, a purchaser shall be held to take that estate as it stands in the person of the seller, and to be bound by the claims which shall ultimately be pronounced."
53. There is, therefore, little room for any doubt that the transfer of the suit property pendete lite is not void ab initio and that the purchaser of any such property takes the bargain subject to the rights of the plaintiff in the pending suit. Although the above decisions do not deal with a fact situation where the sale deed is executed in breach of an injunction issued by a competent Court, we do not see any reason why the breach of any such injunction should render the transfer whether by way of an absolute sale or otherwise ineffective. The party committing the breach may doubtless incur the liability to be punished for the breach committed by it but the sale by itself may remain valid as between the parties to the transaction subject only to any directions which the competent Court may issue in the suit against the vendor.
Even after holding that transfer of suit property pendente lite is not void ab initio but the purchaser takes the property subject to rights of the transferor in the pending suit, His Lordship proceeded to examine whether the transferee is entitled to be impleaded under [SECTION], [SECTION] [ACT]. After examining various judgements on the point, it was held that a transferee pendente lite is not entitled to be impleaded under [SECTION], [SECTION] [ACT], in a suit for specific performance, but he could be impleaded under [SECTION], [SECTION] [ACT], being assignee of the interest of the defendant. It was held thus :-
"54. The third dimension which arises for consideration is about the right of a transferee pendete lite to seek addition as a party-defendant to the suit under [SECTION], [SECTION] [ACT]. I have no hesitation in concurring with the view that no one other than parties to an agreement to sell is a necessary and proper party to a suit. The decisions of this Court have elaborated that aspect sufficiently making any further elucidation unnecessary. The High Court has understood and applied the legal propositions correctly while dismissing the application of the appellant under [SECTION], [SECTION] [ACT]. What must all the same be addressed is whether the prayer made by the appellant could be allowed under [SECTION] [ACT], which is as under:
"10. Procedure in case of assignment before final order in suit. - (1) In other cases of an assignment, creation or devolution of any interest during the pendency of a suit, the suit may, by leave of the court, be continued by or against the person to or upon whom such interest has come or devolved.
(2) The attachment of a decree pending an appeal therefrom shall be deemed to be an interest entitling the person who procured such attachment to the benefit of [SECTION]."
A simple reading of the above provision would show that in cases of assignment, creation or devolution of any interest during the pendency of a suit, the suit may, by leave of the Court, be continued by or against the person to or upon whom such interest has come or devolved. What has troubled us is whether independent of [SECTION] [ACT] the prayer for addition made by the appellant could be considered in the light of the above provisions and, if so, whether the appellant could be added as a party-defendant to the suit. Our answer is in the affirmative. It is true that the application which the appellant made was only under [SECTION] [ACT] but the enabling provision of [SECTION] [ACT] could always be invoked if the fact situation so demanded. It was in any case not urged by counsel for the respondents that [SECTION] could not be called in aid with a view to justifying addition of the appellant as a party-defendant. Such being the position all that is required to be examined is whether a transferee pendete lite could in a suit for specific performance be added as a party defendant and, if so, on what terms.
55. We are not on virgin ground in so far as that question is concerned. Decisions of this Court have dealt with similar situations and held that a transferee pendete lite can be added as a party to the suit lest the transferee suffered prejudice on account of the transferor losing interest in the litigation post transfer. In [PRECEDENT], this Court held that:
"6. The position of a person on whom any interest has devolved on account of a transfer during the pendency of a suit or a proceeding is somewhat similar to the position of an heir or a legatee of a party who dies during the pendency of a suit or a proceeding "
Any such heir, legatee or transferee cannot be turned away when she applies for being added as a party to the suit. The following passage in this regard is apposite:
"6. [SECTION] of the [ACT] no doubt lays down that a transferee pendente lite of an interest in an immovable property which is the subject matter of a suit from any of the parties to the suit will be bound in so far as that interest is concerned by the proceedings in the suit. Such a transferee is a representative in interest of the party from whom he has acquired that interest. [SECTION] of the [ACT] clearly recognises the right of a transferee to be impleaded as a party to the proceedings, and to be heard before any order is made. It may be that if he does not apply to be impleaded, he may suffer by default on account of any order passed in the proceedings. But if he applies to be impleaded as a party and to be heard, he has got to be so impleaded and heard. He can also prefer an appeal against an order made in the said proceedings but with the leave of the appellate court where he is not already brought on record. The position of a person on whom any interest has devolved on account of a transfer during the pendency of any suit or a proceeding is somewhat similar to the position of an heir or a legatee of a party who dies during the pendency of a suit or a proceeding, or an official receiver who takes over the assets of such a party on his insolvency. An heir or a legatee or an official receiver or a transferee can participate in the execution proceedings even though their names may not have been shown in the decree, preliminary or final. If they apply to the court to be impleaded as parties they cannot be turned out."
(emphasis supplied)
56. To the same effect is the decision of this Court in [PRECEDENT] wherein this Court held that a transferor pendente lite may not even defend the title properly as he has no interest in the same or may collude with the plaintiff in which case the interest of the purchaser pendente lite will be ignored. To avoid such situations the transferee pendente lite can be added as a party defendant to the case provided his interest is substantial and not just peripheral. This is particularly so where the transferee pendente lite acquires interest in the entire estate that forms the subject matter of the dispute. This Court observed:
"16 The doctrine of lis pendens applies only where the lis is pending before a court. Further pending the suit, the transferee is not entitled as of right to be made a party to the suit, though the court has a discretion to make him a party. But the transferee pendente lite can be added as a proper party if his interest in the subject-matter of the suit is substantial and not just peripheral. A transferee pendente lite to the extent he has acquired interest from the defendant is vitally interested in the litigation, where the transfer is of the entire interest of the defendant; the latter having no more interest in the property may not properly defend the suit. He may collude with the plaintiff. Hence, though the plaintiff is under no obligation to make a lis pendens transferee a party, under [SECTION] an alienee pendente lite may be joined as party. As already noticed, the court has discretion in the matter which must be judicially exercised and an alienee would ordinarily be joined as a party to enable him to protect his interests. The Court has held that a transferee pendente lite of an interest in immovable property is a representative-in-interest of the party from whom he has acquired that interest. He is entitled to be impleaded in the suit or other proceedings where his predecessor-in-interest is made a party to the litigation; he is entitled to be heard in the matter on the merits of the case"
In the concluding paragraph of the judgement, the conclusions were summed up, thus :-
"57. To sum up:
57.1 The appellant is not a bona fide purchaser and is, therefore, not protected against specific performance of the contract between the plaintiffs and the defendant owners in the suit.
57.2 The transfer in favour of the appellant pendente lite is effective in transferring title to the appellant but such title shall remain subservient to the rights of the plaintiff in the suit and subject to any direction which the Court may eventually pass therein.
57.3 Since the appellant has purchased the entire estate that forms the subject matter of the suit, the appellant is entitled to be added as a party-defendant to the suit.
57.4 The appellant shall as a result of his addition raise and pursue only such defences as were available and taken by the original defendants and none other."
It has thus been authoritatively laid down by the Supreme Court that while an assignee of the interest of defendant in a suit for specific performance cannot seek impleadment under [SECTION] [ACT], but he is entitled to be added as a party defendant to the suit subject to the rider that he would pursue only such defence as was available and taken by the original defendant and none other. In other words, he would step into the shoes of the original defendant from whom he has purchased the property, but would not be entitled to raise pleas inconsistent with the defence taken by his vendor. Infact, this Court in [PRECEDENT] (supra), the judgement relied upon by learned counsel for the respondents, has taken the same view, placing reliance on a Full Bench judgement of this Court in (Smt.) [PRECEDENT] by observing thus :
'27. Thus, since it was [SECTION], which was applicable in the case in hand, the application under [SECTION], [SECTION], in my view, has rightly been rejected in view of Full Bench judgement in (Smt.) [PRECEDENT], where a question was considered whether [SECTION], [SECTION] would apply to a matter governed by [SECTION]. The Court said, when a specific procedure has been prescribed in [SECTION] would have no application.
28. In the present case, the plaintiff-respondent, admittedly, has transferred his rights during the pendency of appeal. Therefore, it was always open to subsequent transferee to seek leave of the Court to prosecute the matter by moving an application under [SECTION], [ACT]."
It is clear from the above discussion that the contention of learned counsel for the petitioners that impleadment of respondent no.13 was permissible under [SECTION], [SECTION] [ACT] and not under [SECTION] [ACT] has got considerable force and is to be accepted, but that would not render the impugned orders illegal. It is noteworthy that in the application filed by respondent no.13 seeking impleadment, the provision of law under which the application was filed, has not been mentioned. The respondent no.13, after narrating facts relating to purchase of the entire interest of defendant no.1 [ENTITY] by registered sale deed during the pendency of the suit, prayed for her impleadment. The application filed by her discloses all the necessary ingredients which are required to be established for seeking permission of the court to be added as party under [SECTION], [SECTION] [ACT]. It is well settled that if the court has power to pass particular kind of order, the mere fact that a wrong provision of law has been mentioned by the court while allowing the application, will not ipso facto result in the order being rendered invalid.
In [PRECEDENT] (supra) an application for substitution filed under [SECTION] was dismissed as not maintainable for the reason that defendant no.4 in the said suit had died even before the institution of the suit. The Supreme Court however found the heirs of the defendant to be necessary and proper party and therefore, held that even if [SECTION] was not applicable, the court should have exercised power vested in it under [SECTION] [ACT]. It was observed that mere mention of a wrong provision of law will not be impediment in the way of court in allowing impleadment if such power is vested under some other provision of law. The relevant observations made in this regard are as under:-
"7. In the matter on hand, the sale was made in favour of defendant no. 7, and the validity of the sale deed was the subject matter of the suit. The purchaser of the property, i.e. defendant no.7, though dead at the time of filing the suit, was made one of the defendants erroneously. The persons who are now sought to be impleaded under [SECTION] of the Code are the legal representatives of the deceased defendant no. 7. Therefore, there cannot be any dispute that the presence of the legal representatives of the deceased is necessary in order to enable the Court to effectively and completely adjudicate upon and settle all the questions in the suit. Their presence is necessary in the suit for the determination of the real matter in dispute. Therefore, they are needed to be brought on record, of course, subject to the law of limitation, as contended under [SECTION] of the [ACT].
8. Merely because the earlier application filed by the appellant under [SECTION] of the Code was dismissed on 09.09.2009 as not maintainable, it will not prohibit the plaintiff from filing another application, which is maintainable in law. There was no adjudication of the application to bring legal representatives on record on merits by virtue of the order dated 09.09.2009. On the other hand, the earlier application filed under [SECTION] of the Code was dismissed by the trial Court as not maintainable, inasmuch as defendant no. 7 had died prior to the filing of the suit and that [SECTION] of the Code comes into the picture only when a party dies during the pendency of the suit. The only course open to the appellant in law was to file an application for impleadment to bring on record the legal representatives of deceased defendant no. 7 under [SECTION] of the Code. Hence, the order passed by the trial Court on the application filed under [SECTION] of the Code, dated 09.09.2009, will not act as res-judicata.
9. [SECTION] of the Code enables the Court to add any person as a party at any stage of the proceedings, if the person whose presence in Court is necessary in order to enable the Court to effectively and completely adjudicate upon and settle all the questions involved in the suit. Avoidance of multiplicity of proceedings is also one of the objects of the said provision. [SECTION] of the Code empowers the Court to substitute a party in the suit who is a wrong person with a right person. If the Court is satisfied that the suit has been instituted through a bona fide mistake, and also that it is necessary for the determination of the real matter in controversy to substitute a party in the suit, it may direct it to be done. When the Court finds that in the absence of the persons sought to be impleaded as a party to the suit, the controversy raised in the suit cannot be effectively and completely settled, the Court would do justice by impleading such persons. [SECTION] of the Code gives wide discretion to the Court to deal with such a situation which may result in prejudicing the interests of the affected party if not impleaded in the suit, and where the impleadment of the said party is necessary and vital for the decision of the suit.
14. In the matter on hand, though the trial court had rightly dismissed the application under [SECTION] of the Code as not maintainable at an earlier point of time, in our considered opinion, it needs to be mentioned that the trial Court at that point of time itself could have treated the said application filed under [SECTION] of the Code as one filed under [SECTION] of the [ACT], in order to do justice between the parties. Merely because of the nonmentioning of the correct provision as [SECTION] of the Code at the initial stage by the advocate for the plaintiff, the parties should not be made to suffer. It is by now well settled that a mere wrong mention of the provision in the application would not prohibit a party to the litigation from getting justice. Ultimately, the Courts are meant to do justice and not to decide the applications based on technicalities. The provision under [SECTION] [ACT] speaks about judicial discretion of the Court to strike out or add parties at any stage of the suit. It can strike out any party who is improperly joined, it can add any one as a plaintiff or defendant if it finds that such person is a necessary or proper party. The Court under [SECTION] of the Code will of course act according to reason and fair play and not according to whims and caprice. The expression "to settle all questions involved" used in [SECTION] of the Code is susceptive to a liberal and wide interpretation, so as to adjudicate all the questions pertaining to the subject matter thereof. The Parliament in its wisdom while framing this rule must be held to have thought that all material questions common to the parties to the suit and to the third parties should be tried once for all. The Court is clothed with the power to secure the aforesaid result with judicious discretion to add parties, including third parties. There cannot be any dispute that the party impleaded must have a direct interest in the subject matter of litigation. In a suit seeking cancellation of sale deed, as mentioned supra, a person who has purchased the property and whose rights are likely to be affected pursuant to the judgment in the suit is a necessary party, and he has to be added. If such purchaser has expired, his legal representatives are necessary parties. In the matter on hand, since the purchaser of the suit property, i.e., defendant no.7 has expired prior to the filing of the suit, his legal representatives ought to have been arrayed as parties in the suit while presenting the plaint. As such impleadment was not made at the time of filing of the plaint in view of the fact that the plaintiff did not know about the death of the purchaser, he cannot be non-suited merely because of his ignorance of the said fact. To do justice between the parties and as the legal representatives of the purchaser of the suit property are necessary parties, they have to be impleaded under [SECTION] of the Code, inasmuch as the application under [SECTION] of the Code was not maintainable.
As mentioned supra, it is only if a defendant dies during the pendency of the suit that the provisions of [SECTION] of the Code can be invoked. Since one of the defendants i.e. defendant No.7 has expired prior to the filing of the suit, there is no legal impediment in impleading the legal representatives of the deceased defendant No.7 under [SECTION] of the Code, for the simple reason that the plaintiff in any case could have instituted a fresh suit against these legal representatives on the date he moved an application for making them parties, subject of course to the law of limitation. Normally, if the plaintiff had known about the death of one of the defendants at the time of institution of the suit, he would have filed a suit in the first instance against his heirs or legal representatives. The difficulty that the High Court experienced in granting the application filed by the plaintiff under [SECTION] of the Code discloses, with great respect, a hyper-technical approach which may result in the miscarriage of justice. As the heirs of the deceased defendant no.7 were the persons with vital interest in the outcome of the suit, such applications have to be approached keeping in mind that the Courts are meant to do substantial justice between the parties and that technical rules or procedures should not be given precedence over doing substantial justice. Undoubtedly, justice according to the law does not merely mean technical justice but means that law is to be administered to advance justice."
Having regard to the foregoing discussion, this Court is of the opinion that the courts below were fully justified in permitting impleadment of respondent No.13 as a party defendant to the suit. Since, however, the impleadment should have been permitted under [SECTION], [SECTION] [ACT] and not under [SECTION], [SECTION] [ACT], therefore it is hereby provided that respondent no.13 shall not be entitled to set up any new defence but shall be permitted to continue the proceedings from the stage it stood when her impleadment application was allowed.
Subject to the aforesaid clarification, the petition stands dismissed.
Order Date :- 24.1.2018 SL ([ENTITY], J.)