Case: Rajwinder Kaur and Ors Vs. Oriental Bank of Commerce and Ors

2. Civil Suit No. 731 of 1995 instituted by the Appellants has been dismissed by three forums leading to the present appeal Under Article 136 of the Constitution of India. Ordinarily and in the normal course this Court would not have been inclined to examine the matter in view of the consistent findings recorded by three forums. However, having considered the facts we are of the view that the matter deserves a closer look for which we have heard the learned Counsels for the parties at length3. The Plaintiffs (Appellants herein) case in the Civil Suit No. 731 of 1995 is that the decree obtained by the Respondent Bank in Civil Suit No. 419 of 1994, which is one for recovery of a sum of Rs. 2,34,170/- along with interest thereon is void, illegal and inoperative in law. Accordingly, a declaration to the above effect was prayed for in the suit4. A few dates will require recapitulation at this stageThe father of the Appellant No. 1 had executed an agreement to purchase the suit property mortgaged in favour of the Bank which is the subject matter of Civil Suit No. 419 of 1994. The mortgage in favour of the Respondent Bank was in the year 1990 whereas the agreement and the suit for specific performance thereof was filed earlier to the date of mortgage i.e. in the year 1989. The said suit was decreed in the year 1992 and the sale deed in execution of the decree was executed in favour of the Plaintiffs in the year 1994, to be specific on 12th April, 1994. It is thereafter that the Civil Suit No. 419 of 1994 was filed by the Respondent Bank i.e. on 6th August, 1994 and that too without impleading the Plaintiffs who had by that time became owners of the suit property in respect of which the mortgage was created in favour of the Respondent-Bank.

Court's reasoning:
If the Plaintiffs were the owners of the suit property we do not see how the suit filed by the Respondent Bank could have proceeded at all in the absence of the Plaintiffs as a party to the said suit. The suit filed by the Respondent-Bank, therefore, clearly suffered from the defect of non-joinder of all necessary parties and the decree passed therein in favour of the Respondent Bank, therefore, was a nullity. That apart, the agreement to sell and the suit for specific performance being anterior to the date of creation of the mortgage, the civil suit filed by the Respondent-Bank for recovery of the mortgaged amount would be hit by the doctrine of lis pendens inasmuch as the suit for specific performance was decreed and the decree executed by execution of the sale deed. We, therefore, do not see how the decree passed in the suit filed by the Respondent-Bank for recovery of the mortgaged amount could be sustained. These are vital aspects of the case that were overlooked by the learned courts below including the fact that the agreement to sell the property in respect of which mortgage was created has already been entered into in favour of the Plaintiff father as far back as on 13th February, 1986 and girdawaris of the said property were changed/corrected in favour of the father of the Appellant No. 1 vide Rapat No. 177 dated 7th February, 1989 as per the order of the Tehsildar, Ajnala which is exhibited as Exhibit P7 in the case5. In the light of the above facts we hold that the findings of the learned courts below to the effect that the Plaintiffs suit (Civil Suit No. 731 of 1995) for setting the decree passed in Civil Suit No. 419 of 1994 (filed by the Respondent-Bank) was without any merit suffer from errors apparent on the face of the record and the said findings would partake the character of perverse findings in law warranting exercise of jurisdiction Under Section 100 of the Code of Civil Procedure, 1908. The High Court having failed to do so we correct the order of the High Court and allow this appeal and decree the Plaintiffs suit (Civil Suit No. 731 of 1995) and declare that the decree passed in Civil Suit No. 419 of 1994 (filed by the Respondent-Bank) is null, void and inoperative insofar as the Appellants are concerned.