*THE HONOURABLE SRI JUSTICE N.R.L.NAGESWARA RAO + APPEAL SUIT NOs.1471 & 1472 OF 2002 % 01-04-2011 # Vijayawada Municipal Corporation, Vijayawada rep. by its Commissioner, Vijayawada. ….Appellant Vs. $ Chagarlamudi Nageswara Rao and another …. Respondents !Counsel for the Appellant : Sri V.L.N.G.K.Murthy Counsel for the Respondents: Sri T.Subrahmanya Reddy <Gist : >Head Note: ? Cases referred: 1. (2011) 1 SCC 167 2. (2010) 5 SCC 104 3. (2003) 12 SCC 91 4. (2006) 13 SCC 599 5. (2002) 5 SCC 383 6. (2006) 5 SCC 353 7. AIR 2008 S.C.1771 8. AIR 1964 A.P. 360 9. AIR 1972 A.P 96 10. (2007) 10 SCC 448 THE HON’BLE SRI JUSTICE N.R.L.NAGESWARA RAO A.S.Nos.1471 and 1472 OF 2002 COMMON JUDGMENT: Both appeals arise out of the common judgment dated 15-07- 2002 in O.S.Nos.559 of 1994 and 78 of 2001 passed by the Principal Senior Civil Judge, Vijayawada. A.S.No.1471 of 2002 was filed against the judgment in O.S.No.559 of 1994 and A.S.No.1472 of 2002 was filed against the judgment in O.S.No.78 of 2001. The defendant in both the suits is the appellant herein. The brief facts of the case are as under:- Suit O.S.No.559 1994 was filed for sale proceedings held by the defendant is null and void and for possession of the suit schedule property. The schedule property is shown as Ac.0.30 cents of land equivalent to 1452 square yards situated in Block No.28, Ward No.14, R.S.NO.141/1, Mutyualampadu of Vijayawada town within specified boundaries. The allegations in the plaint goes to show that the father of the plaintiff has inherited the land in Sy.No.141/B and in the partition between the plaintiff, his father and his brother Ramakoteswara Rao, the plaintiff has got Ac.0.30 cents to his share and a registered partition deed was executed on 24-12-1974. The earlier partition deed between the father of the plaintiff and his brothers dated 07-06-1954 was also filed. The suit schedule property is behind the railway quarters at Satyanarayana Puram and an extent of Ac.0.50 cents was acquired by the Railways from out of AC.1.40 cents owned by the father of the plaintiff. It was further pleaded that after the partition, the property of Ac.0.90 cents was put for sale and in the year 1976 the defendant informed the plaintiff and his father and brother that AC.0.90 cents of land was marked as “P”(park) in the master plan of Vijayawada and further informed that the property should be sold only to the municipality and requested the plaintiff and his other sharers to sell the said land to the defendant. Accordingly the plaintiff, his father and other brothers wrote a joint letter on 14-12-1976 offering to sell the land to the defendant as the defendant has informed that there is no other option. The plaintiff and his other family member filed a statement under Section 6(1). In the letter dated 06-03-1977 the Director of Town Planning clearly stated that the dereservation of site for public space or acquisition of site by municipality is not agreeable to the Department of Town Planning. Thereafter, the defendant addressed a letter to the Government on 28-05-1977. The defendant suppressed so many facts and misled the Government by stating that the plaintiffs along with two others are willing to sell the same to the defendant alone. Thereafter, a letter was addressed to the Collector to fix the market value for sale of the site by private negotiations. In proceedings of the Special Officer and Competent Authority, Urban Land Ceiling (ULC) in its enquiry clearly stated that the father of the plaintiff will be a non-surplus landholder and order was accordingly passed on 09-11-1997 and the same was communicated on 15-11-1977 to the defendant even then the defendant never obliged for the request of the plaintiff to sell the property to outsiders at market value. The Collector fixed the market value @ 22/- per square yard and the defendant requested the plaintiff and others to give consent letters and to receive the amount of compensation of Rs.30,000/- and the balance will be paid only after getting the grant from the Government. Immediately sale deeds were drafted on 23-02-1979 on a non-judicial stamp papers. Meanwhile, the plaintiff requested the defendant when the site is not public purpose, the site may be deleted from the master plan and further requested that the plaintiff is unwilling to sell the land inevitably to the defendant for throw-away price and requested the Government to delete the schedule property from master plan. Accordingly GTOP 69/77 was issued and the land in R.S.No.141/B was deleted from the master plan and it was considered as a residential area. The land in Sy.No.141/P was also marked as “residential area” in G.O.Ms.No.523, dated 25-01-1982. The sale deeds were not registered accordingly in the year 1985. The defendant in the notices dated 23-11-1981, 09-09- 1985 requested the owners of the land to obtain necessary clearance from U.L.C authorities. The Urban Land Ceiling Officer has rejected the applications. On 26-07-1985 a notice was issued by the Sub- Registrar stating that the document was kept aside for want of clearance from U.L.C authorities and not registered. According to the plaintiff, as the suit schedule property being deleted from the master plan, the proposed sale dated 23-02-1979 stood cancelled and not binding on the plaintiff. The defendant also never took steps for getting the document registered. There was no alienation in any manner and the plaintiff is the absolute owner of the property. It was further pleaded that the brother has sold his share to one Ramakoteswara Rao on 10-05-1987 under possessory agreement of sale and after the death of their father-Tataiah, the legal heirs executed the possessory sale agreement in favour of one Gopalarao on 10-08-1987. The plaintiff planned to construct apartments in the suit schedule property and the plaintiff was surprised to know that the defendant was making constructions in the schedule site and therefore in view of the urgency notice under Section 685 of the Hyderabad Municipal Corporation Act may be dispensed with. The plaintiff is ready and willing to pay back the compensation of Rs.30,000/- along with interest. Hence the suit for declaration and possession of the immovable property. The defendant has filed a written statement contending that the suit is bad for want of notice under Section 685 of the Act; the cause of action for filing of the suit is not valid and the suit is barred by limitation and hit under Section 58 of the Limitation Act. It was further pleaded in paras.6 and 7 of the counter-affidavit as under:- “It is submitted that the plaint schedule land was marked for the public purpose in the Master Plan sanctioned by the Government of Andhra Pradesh. As the plaintiff has no option, the plaintiff and Chagarlamudi Tataiah and Chagarlamudi Rama Koteswara Rao offered to sell the plaint schedule land to the defendant. The Government of Andhra Pradesh have accorded permission to the defendant to purchase Ac.0-90 cents of land in R.S.No.141/B. The plaint schedule property Ac.0-30 cents out of Ac.0-90 cents. The Collector, Krishna District has issued proceedings on 10.08.1978 according permission to the defendant to purchase the plaint schedule land at the rate of Rs.22/- per square yard. Accordingly, the value of the plaint schedule was fixed at Rs.31,944/-. The plaintiff agreed to receive Rs.30,000/- and remaining balance of Rs.1,944/- after the defendant receives grant from the Government of Andhra Pradesh. The defendant paid Rs.30,000/- to the plaintiff by way of cheque bearing No.D.640747, dated 21.02.1979 drawn on State Bank of India, Governorpet, Vijayawada-2. The plaintiff delivered vacant possession of the plaint schedule site on 16.02.1979. The plaintiff has signed the sale deed and same was presented for registration on 20.02.1979 in the office of the Sub-Registrar, Vijayawada. The Sub- Registrar kept the matter pending registration and requested the defendant by letter dated 26.07.1985 to furnish a clearance certificate from the urban land Ceiling Authorities. The defendant authorities have served a notice in R.C.G-5-44449/76 dated ……………….. necessary clearance certificate from urban land ceiling authority, Vijayawada and submit the same to the defendant within 15 days from the date of receipt of the notice so as to present in the office of the Sub-Registrar, Vijayawada. The plaintiff having acknowledged the said notice and in spite of subsequent requests, the plaintiff has failed to produce the Urban Land Ceiling Certificate from the competent Authority and thereby the sale transaction was pending in the Sub-Registrar’s office, Vijayawada. The defendant is in uninterrupted possession and enjoyment of the plaint schedule property from February, 1979. By the land and uninterrupted possession and enjoyment of the plaint schedule property from February, 1979 by the defendant, its title to plaint schedule property is preferred. As the defendant has paid Rs.30,000/- to the plaintiff out of the sale consideration and as the defendant is in uninterrupted possession and enjoyment of the plaint schedule property, the plaintiff is debarred from enforcing any right. The V.M.C. is its Council Resolution No.578, dated 07.06.1994 has resolved to construct Kalyan Mandapam in 551.11 sq.Mts. in park NO.1 in R.S.No.141/1B of Vijayawada Town. The respondent authority has called tenders on 15.03.1994 for construction of Kalyan Mandapam and the work has commenced in the month of August, 1994, an amount of Rs.20,00,000/- was already incurred for raising walls up to roof level and the stage of work is containing for the roof slab work is in progress.” The plaintiff has taken the sale consideration from the defendant’s authorities in the year 1979 and failed to obtain the clearance certificate and the defendant has been in absolute possession and enjoyment of the property and it has been put to public use. The intention of the plaintiff is only to stall the proceedings and therefore the suit is liable to be dismissed. On the basis of the pleadings, the following issues were framed for trial:- 1. Whether the plaintiff is entitled for declaration as prayed for? 2. Whether the suit is not maintainable for want of notice under section 685 of Hyderabad Municipal Corporation Act? 3. Whether the suit claim is barred by time? 4. To what relief? A.S.NO.1472 of 2002 When the above suit O.S.No.559 of 1994 was pending, O.S.No.78 of 2001 was filed by the plaintiff in O.S.No.559 of 1994 and also his brother Ramakoteswara Rao for permanent injunction with regard to an extent of Ac.0.60 cents of land restraining the defendant from interfering with the peaceful possession and enjoyment of the suit schedule property. The allegations about the title to the property are repetition of the plaint allegations in O.S.No.559 of 1994. It was pleaded that the defendant’s officials are intending to grab suit schedule property of Ac.0.60 cents and on 09-02-2001 and 12-02- 2001 when they were personally attending the suit schedule property, the officials of the defendant demanded for possession of the suit schedule property. As the defendant is bent upon encroaching the property and also cause interference with possession and enjoyment the suit was filed. The defendant filed a written statement repeating the allegations in O.S.No.559 of 1994 mostly. Further facts were pleaded disclosing that it is the plaintiffs 1 and 2 that have submitted letters on 14-12- 1976, 18-04-1977 and on 17-08-1977 requesting the defendant to take over the property by paying the value of the same as they are in need of money and wanted to come out of financial crisis. Accordingly after correspondence, the Government has permitted and the market value was fixed by the Collector. Subsequently, there was a change in the master plan and the property was deleted from the public purpose and converted into “residential purpose” vide GTP No.6979. Infact by letter dated 13-09-1978 the defendant informed the plaintiffs that they are not willing to purchase their property in view of the above modification. The plaintiffs have submitted a representation to the Minister for Municipal Administration complaining that the defendant has refused to acquire the land in view of the change of the user and requested the Government to consider their case on “humanitarian grounds” and pursue the defendant to acquire the land for the value fixed by the District Collector. The said representation was given by the Minister to the defendant on 22-10-1978 for remarks. Further more another representation was given to the District Collector on 15-09-1978 requesting to persuade the defendant to purchase their land as they are in financial crisis to discharge the loans to a tune of Rs.55,000/-. That representation was also forwarded to the defendant for remarks. Therefore, it is the plaintiffs that have been consistently requesting the defendant to purchase the land and on the basis of those representations the Government by G.O.Ms.No.139 (M.A) dated 28-07- 1978 permitted to acquire the Ac.0.90 cents of land at the rate fixed by the District Collector. The Municipal Council has also accepted for the proposals. The plaintiffs and their father have given the consent letters and received Rs.30,000/- each towards consideration and signed the sale deeds and presented to the Sub-Registrar which were kept pending for want of “Urban Land Ceiling Clearance”. The defendant has also requested the plaintiffs to obtain the “U.L.C” clearance. The plaintiffs have delivered the possession of the property and through the sale deeds the defendant has been in possession and enjoyment of the property. The defendant developed park and maintaining it since 1992. The defendant also constructed watchmen quarters at the northern corner of the park and a compound wall was also constructed on the eastern side and fencing on the remaining three sides to the total extent of Ac.0.90 cents. The defendant started construction of a “Kalyana Mandapam” in the part of the remaining site and at that time when the construction has reached roof level the second plaintiff has filed O.S.No.559 of 1994 and obtained orders of injunction. Meanwhile, the second plaintiff has submitted a representation dated 25-06-1992 with two proposals viz., (1) that the second plaintiff and the first plaintiff are willing to surrender the land in which part the construction was already done by the defendant subject to the condition that “Kalyana Mandapam” should be named after their father-Tataiah; (2) They are agreeing to compensate/repay the amount incurred by the defendant for construction of the building including the sum of Rs.90,000/- received by them. It was further informed that if any one of the above proposals is acceptable, they are ready to withdraw the suit O.S.No.559 of 1994. The defendant did not accept those proposals and was rejected by a letter dated 06-09-1999. The second plaintiff has again submitted a detailed representation. The second plaintiff has also submitted the same representation to the Chief Minister and it was forwarded from the office of the Chief Minister to the defendant by a letter dated 09-08- 2002 for processing and submitting a detailed report. The defendant has sent a report to the Government as to the rejection of the request earlier in the letter dated 25-06-1999 and the circumstances. The defendant pleaded that the defendant has been in continuous possession and enjoyment of the property since 1979. The allegation of un-lawful interference and the illegal attempts to take possession of the property are all false. The plaintiffs have approached the court suppressing the real facts. The defendant has provided civic amenities and the value of the land has increased and with a mala fide and bad intention the plaintiffs are trying to get back their land; there is no cause of action to file the suit and the suit is liable to be dismissed. On the basis of the above pleadings, the following issues have been framed for trial. 1. Whether the plaintiff is entitled for permanent injunction as prayed for? 2. To what relief? On behalf of the plaintiffs PWs.1 to 3 were examined and marked Exs.A-1 to A18 and on behalf of the defendant DWs.1 to 3 were examined and marked Exs.B-1 to B-22. After considering the material evidence on record, the learned Senior Civil Judge has passed the following decrees:- “The suit(O.S.No.559 of 1994) is decreed declaring that the sale proceedings held by the defendant is null and void. The defendant is directed to deliver the vacant possession of the schedule property to the plaintiff within one month from the date of this judgment. The suit (O.S.No.78 of 2001) is decreed directing the defendants not to interfere with the peaceful possession and enjoyment of the plaintiffs over the plaint schedule property on the plaintiffs depositing the advance amount received from the defendant under the original of Exs.B-12 to B14 with interest @ 12% p.a. from the date of Ex.A-18 i.e., 05-03-1982.” Aggrieved by the said common judgment, the present appeals are filed. Heard Sri V.L.N.G.K.Murthy, the learned Senior Counsel for the appellant and Sri T.Subrahmany Reddy, the learned Senior Counsel for the respondents. Now the points that arise for consideration are:- (1) Whether the declaration about the sale transaction given by the lower court is legal? (2) Whether the direction given by the lower court for refund of the money paid towards consideration is legal? (3) Whether the relief of permanent injunction granted by the lower court is legal? (4) Whether there is any fraud or misrepresentation of any fact played by the defendant in inducing the plaintiffs to sell their property? POINTS:- The learned Senior Counsel Sri V.L.N.G.K.Murthy representing the appellants contends that the whole approach of the lower court in dealing with the case is against the pleadings, evidence, law, the principles of equity and the estoppel. According to him, the suit is hopelessly barred by time and the remedy of the plaintiffs is not known to law and there is neither inducement nor misrepresentation or fraudulent act on the part of the defendant and the lower court has consciously avoided to look into several correspondence of the parties whereunder it was the plaintiffs that forced the sale transaction on the defendant. Since the value of the property has gone up, the speculative suit has been resorted to even when the Government has also not accepted the request of the plaintiffs and unfortunately the lower court made out a case which was not pleaded or established by the plaintiffs. His contention is that having obtained the “ULC” exemption on the basis that the property was reserved for “park” and consequently having made the defendant to acquire the same, the plaintiffs cannot turn round and say that the plaintiffs were mislead by the subsequent events of dereserving the area and making it as a residential area. On the other hand, Sri T.Subrahmanya Reddy, the learned Senior Counsel on behalf of the plaintiffs repeated the contentions before the lower court and according to him but for the representation that the land was earmarked for “park” in the master plan and that it was not alienable to others and for the defendant alone it can be sold, the plaintiffs would not have entered into the sale transaction and consequently the sale is vitiated. According to him the question of the application of Urban Land Ceiling Act does not arise as the plaintiffs were declared as non-surplus land owners and the material suppression of the fact was de-notification of the acquired land to residential purpose by the time the sale transaction has taken place. According to him the lower court has considered the case in right perspective and there is no possession of the defendant over the suit schedule property and consequently the decree is legal. In view of the rival contentions of both parties, it is useful at the outset to see as to on what grounds the lower court has accepted the claim of the plaintiffs. Infact the lower court itself felt that the pleadings are vague and the evidence let in by both the parties are not strictly in accordance with each other and relying on a decision reported in AIR 1987 SC 1242 proceeded to decide about the validity of the sale transaction. Having found that the pleadings are not clear, the lower court has definitely placed much of the burden on the defendant rather than the plaintiffs. Infact some of the findings of the lower court deserves to be extracted below. In page.11 of the judgment the lower court found as follows:- “Since the land is demarcated in the master plan for public purpose as rightly put by the defendant in the written statement, the plaintiff has no option but to offer the land for sale to the defendant. There is long correspondence on this aspect. Initially the defendant did not agree to purchase this land. But some how and as rightly being put by the learned counsel for the defendant on the pressure of the plaintiff and his family members, ultimately the defendants agreed to purchase this property.” Further in continuation of the same, in page.12 it was found as under:- “The situation as it stands now is that the title of the schedule property is not transferred in the name of the defendant. No attempts are made by the defendant authorities to get the sale deed executed in their favour in respect of the schedule property.” At page 16 the learned Senior Civil Judge found that there is no free consent and the object is not lawful as the plaintiffs intended to sell the property only because it is marked for public purpose in the master plan, which is with an intention to avoid and circumvent the law. Therefore, the contract is not valid. The lower court during further course of discussion in page.17 found that the defendant has not taken any steps to get the sale deeds obtained inspite of notice by the Sub- Registrar. Sofar as the possession is concerned, the learned Senior Civil Judge found that the recitals in the sale deeds would not disclose that the plaintiff and his family members delivered possession of the property. The learned Senior Civil Judge in page.18 also found that the sale deeds refer to the purpose of sale being for residential quarters and the element of mischief and misrepresentation made by the defendant and his authorities is evident. The lower court also took into consideration that from the evidence of DW.1 the defendant had informed the plaintiffs that the land was converted into “park” to “residential” use and the plaintiffs can apply for a lay-out. Therefore, this shows that there is no delivery of possession. Before considering the tenability of the judgment of the learned Senior Civil Judge, it is to be mentioned that no declaration was sought about the sale transaction with regard to AC.0.60 cents of land except Ac.0.30 cents of land involved in O.S.No.559 of 1994. Further more any declaration about the cancellation of a document or instrument including a contract of sale or a sale agreement is covered by the provisions of Section 31 of the Specific Relief Act which deals with void and voidable contracts. There can be no dispute about the fact that a void contract need not be set aside; whereas a voidable contract has to be set aside. It is useful to refer to Section 31 of the Specific Relief Act as under:- Section 31: When cancellation may be ordered:- (1) Any person against whom a written instrument is void or voidable, and who has reasonable apprehension that such instrument, if left outstanding may cause him serious injury, may sue to have it adjudged void or voidable; and the court may, in its discretion, so adjudge it and order it to be delivered up and cancelled. Therefore, granting of a declaration under Section 31 is discretionary and such a declaration is necessary only if there is any cloud or threat to the title of the person. But such declarations may not arise in cases where the party has received the consideration and executed the agreement or sale deed though not registered since there is nothing as a cloud on the title of the individual. The law with regard to avoidance of a contract being void or voidable is well settled. The party who seeks to challenge