Faqir Singh vs Sarwati Devi

N.C. Jain, J.—In order to determine the precise questions which arise for consideration before this Court, it is necessary to have a brief look at the facts of the instant case.

Plaintiff Smt. Sarwati Devi widow of Mansa Singh, respondent No. 1 before this Court, instituted a suit for declaration to the effect that she was ownerinpossession of the disputed land and the decree obtained by Jaswant Singh and other defendants was based upon fraud etc. and. therefore, not binding upon her. The trial Court decreed the suit vide judgment and decree dated 21.9.1987. On the same day another that suit filed by Jaswant Singh and other defendants to the suit of Smt. Sarwati Devi for permanent injunction restraining her from alienating the suit land was dismissed by the trial Court. Two appeals were filed by the aforesaid Jaswant Singh etc. Faqir Singh and other applicants who are appellants in these two appeals filed applications under Order 22 Rule 10 of the Code of Civil Procedure for being impleaded as parties in the aforesaidmentioned two appeals either in addition Sarwati Devi or by way of substituting her on the ground that she executed a registered sale deed dated 8.10.1987 in their favour. Plaintiffrespondent No. 1 Suit. Sarwati Devi denied the execution of the sale deed and contended that it was she who was in possession of the disputed land as owner. Both the applications were dismissed by the learned Additional District Judge with the following observations :

"I have considered the averments of both the parties. In reply the respondent clearly denied the execution of the sale deed and has further stated that the applicants have no right or title as the respondent is the owner of the property in suit and under that circumstances the applicants cannot be made the party, because they want to step into the shoes of Smt. Sarwati Devi when she herself is protecting her rights in the property and there is no ground to add the applicants as substituted in place of Smt. Sarwati Devi and the application dated 26.7.1990 is dismissed and the appeal is fixed for arguments on 7.10.1991."

The aforementioned observations would show that the mind of the learned Additional District Judge while dismissing the application was influenced by three factors, namely the denial of the execution of the sale deed, protection of the rights in the property by Sarwati Devi herself and that the assignees wanted to be substituted in place of Sarwati Devi.

In these two appeals filed before this Court, the counsel for the parties have addressed arguments at great length. Mr. Viney Mittal, learned counsel for the appellants, has argued that the reasoning advanced by the first appellate Court is untenable inasmuch as the appellants having acquired the ownership rights under a sale deed are entitled to protect their own title. It was further argued that Smt. Sarwati Devi may not collude with Jaswant Singh etc. and compromise the matter thus affecting their rights in the property in dispute. The learned counsel has further argued that in view of the denial of the execution of the sale deed, the Additional District Judge should have held some sort of inquiry, may be, a summary one in order to come to a prima facie conclusion, regarding the validity of the sale deed for judging whether the appellants deserve to be impleaded as parties. It has further been argued that even if the execution of the document is denied, the same is no ground for dismissing the applications.

On the other hand, Mr. R.K. Chhibbar, Senior Advocate, learned counsel for the respondents No. 2 to 9 and Mr. Somesh Ohja, learned counsel for respondent No. 1 have argued that once the very execution of the sale deed has been denied by the respondents, the Additional District Judge was perfectly correct in declining the applications. It had further been argued that the applications were filed by the appellants in the year 1991 claiming themselves to be assignees on the basis of sale deed dated 8.10.1987 and the applications having been filed after an inordinate delay, the same deserve to be dismissed. It has also been argued that there is no averment in the applications that there was any apprehension in the mind of the so called vendee that Smt. Sarwati Devi would compromise the case. The counsel for the parties in order to support their arguments have relied upon one or the other decided case. The following are the relevant decided cases, in my view, and no other ruling is necessary for deciding the precise questions to which reference would be made in the later part of the judgment :

(i) P. Wright Neville v. E.H. Freser, AIR (31) 1944 Nagpur 137;

(ii) Surendra Narain Deo v. Nityendra Narain, AIR 1926 Calcutta 173;

(iii) Lakhshmi Narain v. Babu, AIR (33) 1946 Lahore 33;

(iv) Kartar Singh v. Sanjhe Khan, AIR (33) 1946 Lahore 263;

(v) Laiq Ram v. Mithan Lal etc., 1959 PLR 8;

(vi) Bakhtawar Singh v. Nirmal Singh, AIR 1973 Punjab and Haryana 448; and

(vii) Smt. Pritam Kaur v. Chanan Singh, 1985 PLJ 488 : 1986 R.R.R. 119.

On these premises, as the case has been argued, the following questions of law do arise for determination :

Can the Court dismiss an application under Order 22 Rule 10 C.P.C. on the denial of execution of assignment deed or the assignees are entitled to be substituted despite denial on the basis of assignment deed or is it that under such circumstances the Court should hold some sort of inquiry for the purpose of granting or refusing the application of such assignees to be impleaded as parties ?

Whether a Court of law should dismiss the application for assignment on the ground of delay ?

Can the application of the alleged assignee be dismissed on the ground that assignor is protecting the rights of an assignee ?

To my mind, the aforesaid questions of law are the only questions which arise in the case and other points would be only ancillary thereof.

Adverting to the cases cited at the Bar, this Court proposes to deal with, in the first instance, two decisions given by Nagpur High Court in C. Wright Neville''s case (supra) and the Calcutta High Court in Surendra Narain Deo''s case (supra). In C. Wright Neville''s case (supra), it has been held that the assignee is not bound to apply during pendency of suit and that the application at the stage of appeal is tenable and should be allowed. It has further been held that mere fact that the assignment is disputed is no ground to refuse leave and that the Court can inquire into the validity of the assignment. The Court can hold an inquiry, in the view of the Nagpur High Court. The very fact that the Court is clothed with jurisdiction to grant or refuse leave gives the Court the jurisdiction to hold inquiry, if the assignment is challenged.

In Surendra Narain Deo''s case (supra), it was held that the Court under the provisions of Order 22 Rule 10 C.P.C. has got power to decide the question about the validity of the assignment when an application for substitution is made. The aforesaid judicial pronouncements, in my view, fully apply to the facts of the case.

In Lakhshmi Narain''s case (supra), the Division Bench of the Lahore High court held that the assignee can be impleaded as party in the appeal even if the assignment has been made during the pendency of the suit. This ruling also applies to the facts of the present appeals.

In Kartar Singh''s case (supra), a Single Bench of the Lahore High Court had held that the question whether the plaintiff had assigned his rights during the pendency of the suit is a question of fact. This ruling also applies in the present case inasmuch as the question of fact can be determined only by holding some sort of inquiry and after recording some evidence.

A Division Bench of this Court in Laiq Ram''s case (supra) dismissed the application of Laiq Ram for being impleaded as assignee because he applied after the compromise was effected between the parties to the original litigation on the basis of assignment deed which was executed earlier. Despite the fact that the application of the assignee was dismissed, it was held that Laiq Ram could be brought on the record of the case only to continue the suit of the appeal but not after the same has been decided or disposed of by consent decree or after contest. If no application is made by the assignee, the suit, according to the view of this Court, would continue and disposed of between the parties on the record and the decision would bind the assignee. This case on facts has got no application because the application had admittedly been made in the present case during the pendency of the lis.

In Bahktawar Singh'' case (supra), it has been held that pendente lite transferee''s application could not be rejected on the basis of doctrine of his pendens. The application, it has been held, must be granted unless there is an exceptional ground for its rejection. No complications, according to the view of the learned Single Judge, would arise on impleading the assignee as a party because he could not raise any defence not open to his transferor. Rather he would be bound by all orders of transferor before his being impleaded.

In Pritam Kaur''s case (supra), B.S. Yadav, J. (as he then was) after reviewing the entire case law dismissed the revision petition of a party who challenged the order of the trial Court impleading the assignee as party. It as held that ordinarily application of a transferee should be granted. It was further held that it would not be correct to hold that the assignee has got no right to be impleaded in view of the application of doctrine of lis pendens.

Having given my thoughtful consideration to the entire matter including the various judicial pronouncements, this Court is of the considered view that under the provisions of Order 22 Rule 10 C.P.C. the Court has got wide powers to decide the question about the validity or otherwise of an assignment. A person who is claiming rights under a sale deed cannot be called stranger provided the sale is proved. The delay is no ground to nonsuit an assignee provided on account of delay the case has not been decided or compromised. This Court is further of the view that whenever an application by an assignee is filed before the Court, such an application cannot be thrown away on the ground that the execution of a sale deed is denied. If an application by an assignee filed on the basis of a sale deed is thrown away on the ground of denial of execution of a sale deed, it may cause irreparable loss in the sense that an assignor having been left with no interest may either not fight litigation effectively or may even compromise to the detriment of the interest of an assignee. Simply because no averment made in the application regarding the apprehension of the vendeeapplicants about the bona fides of Sarwati Devi, it would also be no ground to throwaway the application. Such an apprehension even if not pleaded is always there and can even be presumed because the chances of the assignor not taking interest in the litigation cannot be ruled out. On the other litigation hand, it is equally true that if an assignee has obtained the sale deed by practising fraud etc., the assignor cannot be compelled to fight against such an assignee who is guilty of commission of fraud. At the same time, it is equally true, as has been held in some decided cases to which reference has been made on page 4 of the judgment, that the application of an assignee for being impleaded as a party cannot be dismissed simply because the validity and the execution of a sale deed is denied. This Court under the circumstances is of the considered opinion that whenever the execution of an assignment deed and more particularly a sale deed is denied, the Court must hold an inquiry and come to a prima facie conclusion whether the alleged assignees arc entitled to be impleaded as parties either by way of substitution or by way of addition along with the assignor, leaving the parties to have final decision in a suit regarding the validity of assignment. In other words, decision taken by a Court under Order 22 Rule 10 C.P.C. would always be subject to the decision of a suit to be rendered in a properly instituted suit. Since such an inquiry was not held by the appellate Court, this Court is of the view that the appellate Court must hold summary inquiry for determining the validity of the assignment only for the purpose of deciding whether the applicants are entitled to be on the record of the case or not. After holding such an inquiry, the Additional District Judge would decide as to which of the decided cases apply to the facts of the instant case for coming to a final conclusion whether the assignees deserve to be impleaded as parties in the appeal.

For the reasons recorded above, these appeals are allowed, the impugned orders are quashed and the appellate Court is directed to decide the applications afresh in the light of the observations made above.

The parties through their counsel are directed to appear before the Additional District Judge, Sangrur on 21.9.1992.