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Thomas Press (India) Ltd v. Nanak Builders (2013)
«30-Jan-2025
Introduction
- This is a landmark judgment relating to transfer pedente under Transfer of Property Act, 1882 and impleadment proceedings under Civil Procedure Code, 1908.
- The Judgment was delivered by a 2-judge bench consisting of Justice TS Thakur and Justice MY Eqbal.
Facts
- The case concerns a property known as "Ojha House"/"Sawhney Mansion" in Connaught Place, New Delhi, originally owned by the Sawhneys (Mrs. Lakhbir Sawhney and Mr. H.S. Sawhney).
- Following is the timeline of the main events that lead to the genesis of the dispute at hand:
- 29th May 1986: Nanak Builders (plaintiff) entered into an agreement with Sawhneys to purchase 4000 sq.ft. on the 1st Floor for Rs. 50 lakhs, paying Rs. 1 lakh as advance.
- 1988: Living Media India Limited (LMI) offered to lease the same premises.
- September 1990: LMI filed a suit against Sawhneys for injunction.
- 8th April 1991: LMI's suit was compromised, and the property was leased to them.
- 1st November 1991: Nanak Builders filed suit for specific performance of the 1986 agreement.
- 14th October 1998: Vijaya Bank's loan recovery suit was decreed.
- January-April 2001: Sawhneys executed five sale deeds in favor of Thomson Press India Limited.
- Thomson Press has filed an application for impleadment as defendants in the specific performance suit filed by Nanak Builders.
- The Delhi High Court (both Single Judge and Division Bench) rejected Thomson Press's impleadment petition.
- The current appeal is against this rejection order.
Issues Involved
- Whether Thomas Press India Ltd (transferee pendente lite) should be impleaded as a defendant under Order I Rule 10 of Civil Procedure Code, 1908 (CPC)?
Observation
- The Court first of all discussed the doctrine of lis pendens which is embodied in Section 52 of Transfer of Property Act, 1882 (TPA).
- The law on Section 52 of TPA was discussed in the case of Rajender Singh v. Santa Singh (1973) where it was laid down:
- The whole object of the doctrine of lis pendens is to subject parties to the litigation as well as others, who seek to acquire rights in immovable property which are the subject matter of a litigation, to the power and jurisdiction of the Court so as to prevent the object of a pending action from being defeated.
- The doctrine of lis pendens was intended to strike at attempts by parties to a litigation to circumvent the jurisdiction of a court, in which a dispute on rights or interests in immovable property is pending.
- The Court also cited the broad principles laid down for impleadment of parties under CPC:
- The Court can, at any stage of the proceedings, either on an application made by the parties or otherwise, direct impleadment of any person as party, who ought to have been joined as Plaintiff or Defendant or whose presence before the Court is necessary for effective and complete adjudication of the issues involved in the Suit.
- A necessary party is the person who ought to be joined as party to the Suit and in whose absence an effective decree cannot be passed by the Court
- A proper party is a person whose presence would enable the Court to completely, effectively and properly adjudicate upon all matters and issues, though he may not be a person in favour of or against whom a decree is to be made.
- If a person is not found to be a proper or necessary party, the Court does not have the jurisdiction to order his impleadment against the wishes of the Plaintiff.
- In a Suit for specific performance, the Court can order impleadment of a purchaser whose conduct is above board, and who files Application for being joined as party within reasonable time of his acquiring knowledge about the pending litigation. However, if the applicant is beneficiary of a clandestine transaction the Court will be justified in declining the prayer for impleadment.
- The Court observed that in the present facts it cannot be denied that the appellant entered into a clandestine transaction with the defendants and got the property transferred in their favour.
- Hence, it cannot be said that Thomas Press is a bonafide purchaser.
- However, the Court in the present facts held that with regard to the ends of justice and considering the facts and circumstances of the case the appellant should be added as defendant.
Conclusion
- This is the landmark judgment which talks about impleadment of a transferee pendente lite