Saturday, 16 June 2018

When court should reject prayer of addition of parties in suit for specific performance of contract?

In a suit for specific performance, application for impleadment must be filed within a reasonable time. Considering the question of impleadment of party in a suit for specific performance after referring to various judgments, in Vidur Impex and Traders Private Limited and Ors. v. Tosh Apartments Private Limited and Ors. MANU/SC/0663/2012 : (2012) 8 SCC 384 summarized the principles as under:

41. Though there is apparent conflict in the observations made in some of the aforementioned judgments, the broad principles which should govern disposal of an application for impleadment are:

41.1. 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.

41.2. 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.

41.3. 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.

41.4. 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.

41.5. 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.

41.6. However, if the applicant is guilty of contumacious conduct or is beneficiary of a clandestine transaction or a transaction made by the owner of the suit property in violation of the restraint order passed by the court or the application is unduly delayed then the court will be fully justified in declining the prayer for impleadment.

In light of the above principles, considering the case in hand, in our view, the application filed for impleading Respondent No. 3 as Plaintiff No. 3 was not filed within reasonable time. No explanation is offered for such an inordinate delay of 27 years, which was not kept in view by the High Court.

IN THE SUPREME COURT OF INDIA

Civil Appeal No. 16964 of 2017 (Arising out of SLP (C) No. 614 of 2015)

Decided On: 24.10.2017

 Life Insurance Corporation of India Vs. Sanjeev Builders Pvt. Ltd. and Ors.


Hon'ble Judges/Coram:
Kurian Joseph and R. Banumathi, JJ.
Citation: (2018) 11 SCC 722.
Read full judgment here: Click here



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