Bombay High Court Reinstates Civil Suit, Overturns Plaint Rejection on Limitation Grounds.
09 July 2025
Civil Suits >> Civil & Consumer Law
In a significant ruling of Aniket Mahendra Mandhare and Another Vs Sukhdev Dattatray Waje And Another, the High Court of Judicature at Bombay, on July 15, 2025, partially allowed a Second Appeal, setting aside lower court orders that had rejected a civil suit under Order VII Rule 11 (a) and (d) of the Code of Civil Procedure, 1908 (CPC). The case centered on whether the plaintiff's suit for specific performance of a registered agreement and, in the alternative, for refund of earnest money and compensation, was barred by limitation and lacked a valid cause of action.
The appellant (original plaintiff) had filed a suit in 2022 for specific performance of a registered agreement dated June 12, 2015, also seeking possession and damages. Alternatively, the suit sought a refund of Rs. 35,00,000 with interest, compensation of Rs. 1,50,00,000, and recovery of construction expenses. The cause of action was pleaded to arise from a suit notice dated December 29, 2021 (document dated December 18, 2021), demanding execution of the sale deed, along with the notice reply dated January 18, 2022.
The trial court and the first appellate court had rejected the entire plaint, primarily on grounds of limitation, arguing that the cause of action arose much earlier in August 2016 when the respondents (original defendants) had issued notices seeking to cancel the agreement and Power of Attorney (POA).
However, the High Court carefully examined the pleadings. It noted the appellant's contention that after receiving the August 2016 notice, they were requested by the respondents to wait due to an impending family partition. Crucially, the Court observed that the respondent's reply in January 2022 to the appellant's December 2021 notice expressed readiness to refund Rs. 13,00,000 and requested the appellant to cancel the registered agreement and POA. This, the High Court reasoned, indicated that one of the joint promisors still treated the agreement as subsisting, casting doubt on the argument that the August 2016 notice constituted a conclusive refusal of performance.
Citing the Supreme Court's decision in Central Bank of India and Another vs. Prabha Jain And Others, the High Court reiterated that a plaint cannot be partially rejected under Order VII Rule 11 CPC. Even if one relief survives, the entire plaint cannot be thrown out. The Court found that the alternative prayers for refund, interest, and compensation, based on the registered agreement and the subsequent correspondence, could not be dismissed as time-barred without a full trial and evidence. It termed these "mixed questions of facts and law" that require a deeper examination.
The High Court distinguished the respondent's reliance on cases like Dahiben Vs. Arvindbhai Kalyanji Bhanusali and Nikhila Divyang Mehta & Anr. Vs. Hitesh P. Sanghvi & Ors., stating that the present case involved distinct prayers for refund and compensation not solely dependent on the success of specific performance. Furthermore, it clarified that judgments allowing partial rejection of a plaint against some defendants (e.g., in Chetana Shankar Manapure and Another Vs. Bandu s/o Tanaji Barapatre), were applicable in peculiar facts where some defendants were not signatories to the agreement, which was not the case here as both respondents had signed the agreement.
Consequently, the High Court quashed the lower courts' orders to the extent they rejected the plaint under Order VII Rule 11(a) and (d). However, it remanded the matter back to the trial court for fresh consideration on the grounds of improper valuation and insufficient stamping/court fees (Order VII Rule 11(b) and (c)), allowing the plaintiffs an opportunity to cure any defects.
The decision underscores that a plaint should not be rejected at a preliminary stage if a valid cause of action is pleaded and some reliefs may survive, particularly when the exact point of refusal of performance is debatable and requires evidentiary proof. The operation of this order, specifically its rejection of the Order VII Rule 11(a) and (d) application, has been stayed for four weeks at the request of the respondents' counsel.
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