List of Current Affairs

Source: Jharkhand High Court 

Why in News? 

Recently, the Jharkhand High Court in the matter of M/s City Alloys Private Limited & Ors vs M/s Hari Om & Co. has held that amendment to the affidavit under commercial suits for the purpose of incorporating statement of truth is not permissible. 

What was the Background of the M/s City Alloys Private Limited & Ors vs M/s Hari Om & Co. Case?    

• A commercial suit has been filed between M/s Hari Om & Co. (Plaintiff) and M/s City Alloys Private Limited & Others (Defendants). 
• M/s City Alloys Private Limited operates through: 
  • Vikash Kumar Gaddhyan (Managing Director), aged 50 years, based in Chirkunda, District Dhanbad. 
  • Narendra Gopal Singhal (Director), aged 56 years, based in Hanuman Charai, Barakar, District Bardman. 
• The opposing party, M/s Hari Om & Co., operates through its Proprietor Shri Ajay Kumar (son of late Ramjee Saw) and has its factory at B-2, Industrial Area, Adityapur, Jamshedpur 
• The plaintiff filed an application under Order VI Rule 17 of the Code of Civil Procedure, 1908 (CPC) seeking to incorporate the statement of truth under Order-VI, Rule-15A of the Commercial Court Act, 2015 (CC). 
• The defendants opposed this application by filing an objection/reply. 
• The case involves compliance with Rule-15A of CC Act which requires verification of pleadings in commercial disputes through an affidavit in a prescribed manner and form as per the schedule. 
• The original plaint in the Commercial Suit did not contain the verification of pleading as required under Rule-15A of the CC Act. 
• This forms the essential background of the legal dispute that led to the present Civil Miscellaneous Petition before the High Court of Jharkhand at Ranchi. 

What were the Observations of the Court? 

• The Jharkhand High Court observed that:  
  • Regarding Service of Notice: 
    • The court noted that the notice to the sole opposite party was received by his brother. 
    • This was deemed as sufficient service of notice. 
    • The court observed that no one appeared on behalf of the opposite party despite deemed service. 
  • On Amendment of Pleadings: 
    • The court observed that while amendments can be made in pleadings (which include plaint and written statement), there are limitations. 
    • The court noted that applications in any proceeding can also be amended as per settled propositions of law. 
  • On the Lower Court's Approach: 
    • The High Court observed that the lower court should have provided an opportunity to file the statement of truth (affidavit) in the prescribed form under Rule-15A of CC Act. 
    • This could have been done either in addition to or in place of the general affidavit annexed with the plaint. 
    • The court found that allowing amendment to the affidavit itself was not the correct approach. 
  • Critical Observation on Statement of Truth: 
    • The court emphasized that an affidavit does not come within the purview of pleading. 
    • If an affidavit was not properly filed as per Rule-15A of the CC Act, the only available option was to file a fresh statement of truth in the format prescribed in the Act's schedule. 
  • On Lower Court's Order: 
    • The High Court found that the order passed by the lower court was based on "perverse finding." 
    • The court observed that the amendment allowed by the lower court needed interference. 
• These observations led the High Court to conclude that the matter required correction and appropriate directions for compliance with the CC Act. 

What are Affidavits? 

About: 

• It is considered as a declaration of facts, made in writing sworn before a person having authority to administer oath.  
• Every affidavit should be drawn up in the first person and should contain only facts and not inferences.  
• Order XIX of CPC deals with the provision relating to affidavits. 

Essentials: 

• The essential elements of an affidavit are:  
  • It must be a declaration made by a person.  
  • It must relate to facts.  
  • It must be in writing.  
  • It must be in the first person.  
  • Must be sworn or affirmed before a Magistrate or any other authorized officer. 

Contents: 

• An affidavit should be confined to such facts as the deponent is able to prove to his personal knowledge.  
• Rule 3(1) of Order XIX of CPC states that the affidavits shall be confined to such facts as the deponent is able of his own knowledge to prove, except on interlocutory applications, on which statements of his belief may be admitted; provided that the grounds thereof are stated. 
• Rule 3(2) of Order XIX of CPC states that the costs of every affidavit which shall unnecessarily set forth matters of hearsay or argumentative matter, or copies of or extracts from documents, shall (unless the Court otherwise directs) be paid by the party filing the same. 

Verification: 

• An affidavit should be verified.  
• The importance of verification is to test the genuineness and authenticity of the of the averments and allegations made by the deponent.  

Power to Prove: 

• Rule 1 of Order XIX of CPC deals with the power to order any point to be proved by affidavit. 
• It states that any Court may at any time for sufficient reason order that any particular fact or facts may be proved by affidavit, or that the affidavit of any witness may be read at the hearing, on such conditions as the Court thinks reasonable.  
• Provided that where it appears to the Court that either party bona fide desires the production of a witness for cross-examination, and that such witness can be produced, an order shall not be made authorizing the evidence of such witness to be given by affidavit.  

Evidence on Affidavit: 

• A Court may order that the any fact may be proved by affidavit.  
• If the affidavits are not properly verified and are in conformity with the rules, they will be rejected by the Court.  
• Rule 2 of Order XIX of CPC deals with the power to order attendance of deponent for cross-examination. It states that-  

(1) Upon any application evidence may be given by affidavit, but the Court may, at the instance of either party, order the attendance for cross-examination of the deponent.  

(2) Such attendance shall be in Court, unless the deponent is exempted from personal appearance in Court, or the Court otherwise directs.

False Affidavit:

• Swearing of false affidavit is an offence of perjury which is punishable 
• It is a grave and serious matter, and a lenient view is not warranted.

What is Order VI, Rule 15-A of the CC Act?

• Rule 15 A of Order VI, states the Rules regarding verification of Pleadings in Commercial Disputes as: 
  • Every pleading in commercial disputes must be verified by affidavit. 
  • This requirement overrides Rule 15. 
  • Must follow manner and form prescribed in Schedule Appendix. 
  • Authorized Signatories: 
    • Party to the proceedings. 
    • One of the parties to the proceedings. 
    • Any other authorized person who: 
      • Is acquainted with case facts. 
      • Can prove such acquaintance to court's satisfaction. 
      • Has proper authorization from party/parties. 
  • Amendment Verification: 
    • All amendments must be verified in the same form/manner as the original. 
    • Exception: Court orders otherwise. 
  • Evidentiary Consequences: 
    • Party cannot rely on unverified pleading as evidence. 
    • Matters set out in unverified pleading cannot be used as evidence. 
  • Court's Powers 
    • Court may strike out any pleading. 
    • Grounds for striking out: Not verified by Statement of Truth. 
    • Statement of Truth refers to affidavit in Schedule Appendix.

Source: Supreme Court 

Why in News? 

A bench of Justice JB Pardiwala and Justice R Mahadevan laid down the conditions requisite for invoking Section 53A of Transfer of Property Act, 1882.               

• The Supreme Court held this in the case of Giriyappa & Anr v. Kamalamma & Ors. (2024). 

What was the Background of Giriyappa & Anr v. Kamalamma & Ors. Case?  

• The respondents instituted a suit seeking declaration of title and recovery of possession of the suit-scheduled property. 
• The Trial Court decreed the suit in favor of the respondents. 
• The petitioners filed a Regular First Appeal, which was dismissed. They then filed a Regular Second Appeal which was also dismissed by the High Court. 
• The High Court framed a key legal question regarding whether the defendants could claim protection under Section 53A of the Transfer of Property Act, 1882 (TPA) based on an unregistered sale agreement. 
• The High Court observed the following: 
  • The petitioners failed to prove the existence and execution of the alleged sale agreement. 
  • The property in question was shown to be in the lawful possession of the respondents. 
  • The findings of the lower courts were consistent with the evidence presented. 
• The petitioners (original defendants) filed this Special Leave Petition (SLP) challenging the dismissal of their Second Appeal by the High Court of Karnataka. 

What were the Court’s Observations?  

• The Court first of all discussed the conditions to be fulfilled for invoking the remedy of part performance under Section 53 A of TPA. 
• The Court observed that Section 53A has been added to act as a shield for the prospective transferee who is holding possession of the property under the contract of sale. 
• The main question to be determined here was whether the relief of part performance can be granted or not. 
• The Court observed that the plaintiff has failed to show that the respondent has executed a sale agreement in it’s favor and would not entitle him to claim part performance of the contract. 
• Thus, the petition was dismissed in this case.

What is Section 53A of TPA?

• Section 53A of TPA provides for part performance of contract. 
• The purpose for introducing Section 53 A in TPA is to partly set right the conflict of views in this country. 
• Principally, it was inserted however for the protection of ignorant transferees who take possession of or spend money on improvements relying on documents which are ineffective as transfers or on contracts which cannot be proved for want of registration.  
• The effect of this section is to relax the strict provisions of the Transfer of Property Act and the Registration Act in favor of transferees in order to allow the defense of part performance to be established. 
• Section 53-A is an exception to the provisions which require a contract to be in writing and registered and which bar proof of such contract by any other evidence. 
• The exception must therefore be strictly construed.

What are the Conditions Requisite for Invoking Section 53A of TPA? 

• The conditions requisite for invoking Section 53 A of TPA are as follows: 
  • There is a contract in writing by the transferor for transfer for consideration of any immovable property signed by him or on his behalf, from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty. 
  • The transferee has, in part-performance of the contract, taken possession of the property or any part thereof, or the transferee, being already in possession, continues in possession in part performance of the contract. 
  • The transferee has done some act in furtherance of the contract and has performed or is willing to perform his part of the contract. 
• Thus, the elements of Section 53 A of TPA: 
  • Existence of an Agreement: 
    • There must be a valid agreement between the parties for the transfer of property, even if it is not in writing or registered. 
  • Payment of Consideration: 
    • The transferee must have paid or agreed to pay the consideration, either fully or in part, as per the terms of the agreement. 
  • Taking Possession or Making Improvements: 
    • The transferee must have taken possession of the property or performed substantial acts of improvement on it based on the agreement.

What are the Case Laws on Section 53A of TPA?

• Probodh Kumar Das v. Dantra Tea Company Limited & Others (1939): 
  • The Privy Council in this case laid down the law that Section 53 A of Transfer of property Act, 1882 (TPA) does not confer any right of action on a transferee in possession. 
  • The Court was in agreement with the view that the right conferred by Section 53 A is a right available only to the defendant to protect his possession. 
  • It does not confer any active title on the transferee.
• Arun Kumar Tandon v. M/s Akash Telecom Private Limited (2010): 
  • The Supreme Court in this case held that in order to give benefits of Section 53 A of TPA the document relied upon must be a registered document.  
  • Any unregistered document cannot be relied upon or taken into evidence in view of Sections 17 (1A) read with Section 49 of the Registration Act. 
  • Thus, the benefit of Section 53 A of TPA can be given if and only if the alleged agreement to sell is registered and it satisfies the requirements of Section 17 (1A) of Registration Act, 1908.
• Shrimant Shamrao Suryavanshi And Another v. Pralhad Bhairoba Suryavanshi (d) by LR’s And Ors. (2002): 
  • In this case the issue to be determined by the Court was whether the plaintiff was entitled to protect their possession in pursuance of part performance under Section 53 A of TPA when the suit for specific performance of contract is barred by limitation. 
  • It is to be that Section 53 A nowhere prohibits the party from taking this plea of defence. 
  • The necessary conditions for the purpose of applicability of Section 53 A are: 
    • There must a contract to transfer for consideration any immovable property. 
    • The contract must be in writing signed by the transferor. 
    • The writing must be in words from which terms necessary to construe transfer can be ascertained. 
    • The transferee must in part performance take possession of the property, or any part thereof. 
    • The transferee must have done something in furtherance of the contract. 
    • The transferee must have performed or be willing to perform his part of the contract. 
  • The Court therefore held that if the conditions above are fulfilled the law of limitation does not come in way of a defendant taking the plea under Section 53 A of TPA.  
  • Further, the Court held that the law of limitation is not applicable to the plea taken in defense unless there is an express provision in the statute. The law of limitation applies to suits and applications, and it does not apply to defence taken in suits.