CUSTOM SEARCH

A SUIT AND ORIGINAL PETITION DISTINGUISHED 2012 SC

READ FULL JUDGMENT
Justice K.S. Radhakrishnan, and Justice Dipak Misra of Supreme Court of India, in the case of Sinnamani & Anr. vs G. Vettivel & Ors. Decided on 9 May, 2012 A suit can be instituted by presentation of a plaint and Order IV and VII C.P.C. deals with the presentation of the plaint and the contents of the plaint. Chapter I of the Civil Rules of Practice deals with the form of a plaint. When the statutory provision clearly says as to how the suit has to be instituted, it can be instituted only in that manner alone, and no other manner. The Trust Act contains 9 chapters. Chapter 6 deals with the rights and liabilities of the beneficiaries, which would indicate that the beneficiaries of trust have been given various rights and those rights are enforceable under the law. Section 59 of the Act confers a right upon the beneficiaries to sue for execution of the trust which would indicate that the beneficiaries may institute a suit for execution of the trust. Therefore, the above-mentioned provisions would show that in order to execute the trust, the right is only to file a suit and not any original petition. Under the Trust Act also for certain other purposes original petitions can be filed. Section 72 of the Trust Act provides for a trustee to apply to a principal civil court of original jurisdiction by way of petition to get himself discharged from his office. Similarly, Section 73 of the Act empowers the principal civil court of original jurisdiction to appoint new trustees. Few of the provisions of the Act permit for filing of original petitions. The above facts would clearly indicate that the Trust Act provides for filing of a suit then suit alone can be filed and when it provides for original petition then original petition alone can be filed and there is no question of conversion of original petition to that of a civil suit or vice-versa, especially in the absence of a statutory provision under the Trust Act. ........... Certain legislations specifically provide for conversion of original petition into a suit. Section 295 of the Indian Succession Act is such a provision. The Trust Act, however, contains no such enabling provision to convert the original petition into a suit.

A similar question came up for consideration before this Court in P.A. Ahmad Ibrahim v. Food Corporation of India ((1999) 7 SCC 39) wherein, while interpreting Section 20 C.P.C. the Court held as follows: “Further, before applying the provisions of Order VI Rule 17, there must be institution of the suit. Any application filed under the provisions of different statutes cannot be treated as a suit or plaint unless otherwise provided in the said Act. In any case, the amendment would introduce a totally new cause of action and change the nature of the suit. It would also introduce a totally different case which is inconsistent with the prayer made in the application for referring the dispute to the arbitrator. Prima facie, such amendment would cause serious prejudice to the contention of the appellant that the claim of the respondent to recover the alleged amount was barred by the period of limitation as it was pointed out that cause of action for recovery of the said amount arose in the year 1975 and the amendment application was filed on 30.3.1986. Lastly, it is to be stated that in such cases, there is no question of invoking the inherent jurisdiction of the Court under Section 151 of the C.P.C. as it would nullify the procedure prescribed under the Code.”

SPECIFIC PERFORMANCE SUIT - ESCALATION OF PRICE NO GROUND TO REFUSE - UNLESS PLEADED HARDSHIP AND UNDUE ADVANTAGE 2012 SC

READ FULL JUDGMENT
Justice G.S. Singhvi, and Justice Sudhansu Jyoti Mukhopadhaya of The Supreme Court of India in the case of Narinderjit Singh vs North Star Estate Promoters Ltd. Decided on 8 May, 2012

TRIAL COURT FINDINGS:- In this case, the trial Court declined the relief of specific performance by observing that the price of the land had considerably increased and it would be unfair to compel the appellant to execute the sale deed at the rate agreed to by the parties. For arriving at this conclusion, the trial Court relied upon the judgments of this Court in Sargunam (Dead) by L.R. v. Chidambaram (2005) 1 SCC 162 and Janardhanam Prasad v. Ramdas (2007) 15 SCC 174 and of the Division Bench of the Punjab and Haryana High Court in Mohan Singh v. Kulwinder Singh 2006 (2) P.L.J. 748 and of the Allahabad High Court in Ramawati Devi v. Idris Ahmad 2008 (2) Civil Court Cases 332. The trial Court finally held that the respondent is entitled to refund of the earnest money with interest at the rate of 12% per annum.

LOWER APPELLATE COURT FINDINGS:- The respondent challenged the judgment and decree of the trial Court by filing an appeal. The appellant and his father did not file appeal or cross objection to challenge the findings recorded by the trial Court on the issues of execution of the agreement and readiness and willingness on the respondent’s part to perform its part of the agreement. The lower appellate Court independently analysed the pleadings and evidence of the parties and agreed with the trial Court that the respondent had succeeded in proving execution of the agreement and its readiness and willingness to pay the balance amount and perform its part of the obligation. ..... The lower appellate Court disagreed with the trial Court that the respondent is not entitled to decree of specific performance because cost of the suit property had increased and observed that there was no justification to relieve the appellant of his obligation to execute the sale deed in terms of the agreement.

HIGH COURT SECOND APPELLATE COURT :- The second appeal filed by the appellant was dismissed by the learned Single Judge of the Punjab and Haryana High Court who concurred with the lower appellate Court that the trial Court was not justified in invoking the provisions of Section 20 (2) (c) of the Specific Relief Act, 1963 (for short, ‘the Act’) for the purpose of declining substantive relief to the respondent. The learned Single Judge relied upon the judgments of this Court in K. Narendra v. Riviera Apartments (P) Ltd. (1999) 5 SCC 77, Sargunam (Dead) by LRs. v. Chidambaram (supra) 1 SCC 162 and Gobind Ram v. Gian Chand 2000 (7) SCC 548, and held that inadequacy of consideration or the fact that the contract is onerous to the defendant is not sufficient to deny the relief of specific performance.

Supreme Court held: The question whether the respondent was ready and willing to perform its part of the agreement is required to be decided in the light of the pleadings of the parties, evidence produced by them and their conduct........ The thrust of the case set up by the appellant was that his father had neither executed the agreement nor received the earnest money. According to him, the agreement was an end product of criminal conspiracy hatched by the respondent with the help of Col. Harjit Singh and Vijay Bhardwaj for defrauding him. The appellant also pleaded that the agreement relied upon by the respondent was a fake and fabricated document. In reply to the averments contained in para 5 of the plaint that the respondent was always ready and willing and is still ready and willing to perform its part of the contract, the following statement was made in the written statement: “5. Para no.5 of the plaint is wrong and therefore denied. The question of readiness and willingness on the part of the defendants does not arise at all. Question of receiving of Rs. nine lac also does not arise at all.” ..............

The trial Court comprehensively analysed the pleadings and evidence of the parties and held that the respondent has succeeded in proving execution of the agreement by the appellant’s father and receipt of Rs.1,00,000/- by him. The trial Court then considered the question whether the respondent was ready and willing to pay the balance price and observed: ........... The defendants are also estopped from taking the plea that plaintiff was not ready and willing to perform his part of the contract and that the plaintiff did not have the capacity to make the payment when the defendants have denied the very execution of the agreement in question. .......... After Finger Prints and Handwriting Expert, who has specifically stated on oath before the Court .......... So, the agreement in question ...............duly stands proved in accordance with provisions of law. It stands sufficiently proved on record that defendants ................. had executed an agreement to sell in favour of the plaintiff after receiving earnest amount of Rs.one lacs from the plaintiff in the presence of marginal witnesses.”.......... The appellant did not question the aforesaid findings of the trial Court by filing an appeal. Not only this, he did not file cross-objection in the appeal filed by the respondent. Therefore, the lower appellate Court was not required to consider whether execution of the agreement for sale has been proved and whether respondent was ready and willing to perform its part of the agreement, but it considered both the questions ..............

On the other hand, the defendants/respondents have denied the agreement in question and it is not their plea that appellant/plaintiff was not ready and willing to perform its contract. Under these circumstances, the evidence produced by the appellant/plaintiff to prove their readiness and willingness to perform their part of contract can be accepted without any hesitation and in this regard I find support from the judgment of Hon'ble Punjab and Haryana High Court in Santa Singh Vs. Binder Singh and Ors 2006(4) Civil Court Cases-608 wherein it was held as under:- "Since the case of the defendant is that of one of denial, therefore, the statement of the plaintiff that he was ready and willing to perform his part of the contract is sufficient to infer that plaintiffs were ready and willing to perform their part of contract. It was a meager amount of Rs.2000/- alone which was required to be paid at the time of registration of the sale deed. The substantial amount was paid at the time of execution of the agreement. More than Rs.12000/- was kept for payment to the mortgagee. Therefore, the argument raised by the learned counsel for the appellant that the plaintiffs have led evidence to prove his ready and willingness to perform the contract is not tenable.”

In R.C. Chandiok v. Chuni Lal Sabharwal (1970) 3 SCC 140, this Court observed that “readiness and willingness cannot be treated as a straitjacket formula and the issue has to be decided keeping in view the facts and circumstances relevant to the intention and conduct of the party concerned”. The same view was reiterated in D'Souza v. Shondrilo Naidu, (2004) 6 SCC 649. In N.P. Thirugnanam v. R. Jagan Mohan Rao (Dr) (1995) 5 SCC 115, the Court found that the appellant was dabbling in real estate transaction without means to purchase the property and observed: “Section 16(c) of the Act envisages that plaintiff must plead and prove that he had performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than those terms the performance of which has been prevented or waived by the defendant. The continuous readiness and willingness on the part of the plaintiff is a condition precedent to grant the relief of specific performance. This circumstance is material and relevant and is required to be considered by the court while granting or refusing to grant the relief. If the plaintiff fails to either aver or prove the same, he must fail. To adjudge whether the plaintiff is ready and willing to perform his part of the contract, the court must take into consideration the conduct of the plaintiff prior and subsequent to the filing of the suit along with other attending circumstances. The amount of consideration which he has to pay to the defendant must of necessity be proved to be available. Right from the date of the execution till date of the decree he must prove that he is ready and has always been willing to perform his part of the contract. As stated, the factum of his readiness and willingness to perform his part of the contract is to be adjudged with reference to the conduct of the party and the attending circumstances. The court may infer from the facts and circumstances whether the plaintiff was ready and was always ready and willing to perform his part of the contract.”

We are also inclined to agree with the lower appellate Court that escalation in the price of the land cannot, by itself, be a ground for denying relief of specific performance. In K. Narendra v. Riviera Apartments (P) Ltd. ((1999) 5 SCC 77), this Court interpreted Section 20 of the Act and laid down the following propositions: “Section 20 of the Specific Relief Act, 1963 provides that the jurisdiction to decree specific performance is discretionary and the court is not bound to grant such relief merely because it is lawful to do so; the discretion of the court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal. Performance of the contract involving some hardship on the defendant which he did not foresee while non-performance involving no such hardship on the plaintiff, is one of the circumstances in which the court may properly exercise discretion not to decree specific performance. The doctrine of comparative hardship has been thus statutorily recognized in India. However, mere inadequacy of consideration or the mere fact that the contract is onerous to the defendant or improvident in its nature, shall not constitute an unfair advantage to the plaintiff over the defendant or unforeseeable hardship on the defendant.”

In the present case, the appellant had neither pleaded hardship nor produced any evidence to show that it will be inequitable to order specific performance of the agreement.

GUIDELINES ON MODE OF PLEADINGS AND DOCUMENTS TO BE PRODUCED FOR CLAIMING POSSESSION RE-STRESSED 2012 SC

FULL JUDGMENT
JUSTICE Dalveer Bhandari, & JUSTICE Dipak Misra of Supreme court of India in the case of A.Shanmugam vs Ariya, Decided on 27 April 2012, has held that This case demonstrates widely prevalent state of affairs where litigants raise disputes and cause litigation and then obstruct the progress of the case only because they stand to gain by doing so. It is a matter of common experience that the Court’s otherwise scarce resources are spent in dealing with non-deserving cases and unfortunately those who were waiting in the queue for justice in genuine cases usually suffer. This case is a typical example of delayed administration of civil justice in our Courts. A small suit, where the appellant was directed to be evicted from the premises in 1994, took 17 years before the matter was decided by the High Court. Unscrupulous litigants are encouraged to file frivolous cases to take undue advantage of the judicial system. ..... The question often arises as to how we can solve this menace within the frame work of law. ........ The court further observed that "We reiterate the immense importance and relevance of purity of pleadings. The pleadings need to be critically examined by the judicial officers or judges both before issuing the ad interim injunction and/or framing of issues. ....... The entire journey of a judge is to discern the truth from the pleadings, documents and arguments of the parties. Truth is the basis of justice delivery system. This Court in Dalip Singh v. State of U.P. and Others (2010) 2 SCC 114 observed that truth constitutes an integral part of the justice delivery system which was in vogue in pre-independence era and the people used to feel proud to tell truth in the courts irrespective of the consequences. However, post-independence period has seen drastic changes in our value system. ........... As stated in the preceding paragraphs, the pleadings are foundation of litigation but experience reveals that sufficient attention is not paid to the pleadings and documents by the judicial officers before dealing with the case. It is the bounden duty and obligation of the parties to investigate and satisfy themselves as to the correctness and the authenticity of the matter pleaded................ The pleadings must set-forth sufficient factual details to the extent that it reduces the ability to put forward a false or exaggerated claim or defence. The pleadings must inspire confidence and credibility. If false averments, evasive denials or false denials are introduced, then the Court must carefully look into it while deciding a case and insist that those who approach the Court must approach it with clean hands.................. It is imperative that judges must have complete grip of the facts before they start dealing with the case. That would avoid unnecessary delay in disposal of the cases. ................... Ensuring discovery and production of documents and a proper admission/denial is imperative for deciding civil cases in a proper perspective. In relevant cases, the Courts should encourage interrogatories to be administered. ........ If issues are properly framed, the controversy in the case can be clearly focused and documents can be properly appreciated in that light. The relevant evidence can also be carefully examined. Careful framing of issues also helps in proper examination and cross-examination of witnesses and final arguments in the case. .......... The appellant is also guilty of introducing untenable pleas. The plea of adverse possession which has no foundation or basis in the facts and circumstances of the case was introduced to gain undue benefit. The Court must be cautious in granting relief to a party guilty of deliberately introducing irrelevant and untenable pleas responsible for creating unnecessary confusion by introducing such documents and pleas. These factors must be taken into consideration while granting relief and/or imposing the costs................ False averments of facts and untenable contentions are serious problems faced by our courts. The other problem is that litigants deliberately create confusion by introducing irrelevant and minimally relevant facts and documents. The court cannot reject such claims, defences and pleas at the first look. It may take quite sometime, at times years, before the court is able to see through, discern and reach to the truth. More often than not, they appear attractive at first blush and only on a deeper examination the irrelevance and hollowness of those pleadings and documents come to light. ................... Our courts are usually short of time because of huge pendency of cases and at times the courts arrive at an erroneous conclusion because of false pleas, claims, defences and irrelevant facts. A litigant could deviate from the facts which are liable for all the conclusions. In the journey of discovering the truth, at times, this Court, on later stage, but once discovered, it is the duty of the Court to take appropriate remedial and preventive steps so that no one should derive benefits or advantages by abusing the process of law. The court must effectively discourage fraudulent and dishonest litigants. A serious endeavour has been made as to how the present system can be improved to a large extent. In the case of Maria Margarida Sequeria Fernandes and Others v. Erasmo Jack de Sequeria (Dead) through L.Rs. (2012) 3 SCALE 550 , this Court had laid stress on purity of pleadings in civil cases. We deem it appropriate to set out paras 61 to 79 of that judgment dealing with broad guidelines provided by the Court which are equally relevant in this case:- “61. In civil cases, pleadings are extremely important for ascertaining the title and possession of the property in question. 62. Possession is an incidence of ownership and can be transferred by the owner of an immovable property to another such as in a mortgage or lease. A licensee holds possession on behalf of the owner. 63. Possession is important when there are no title documents and other relevant records before the Court, but, once the documents and records of title come before the Court, it is the title which has to be looked at first and due weightage be given to it. Possession cannot be considered in vacuum. 64. There is a presumption that possession of a person, other than the owner, if at all it is to be called possession, is permissive on behalf of the title-holder. Further, possession of the past is one thing, and the right to remain or continue in future is another thing. It is the latter which is usually more in controversy than the former, and it is the latter which has seen much abuse and misuse before the Courts. 65. A suit can be filed by the title holder for recovery of possession or it can be one for ejectment of an ex-lessee or for mandatory injunction requiring a person to remove himself or it can be a suit under Section 6 of the Specific Relief Act to recover possession. 66. A title suit for possession has two parts – first, adjudication of title, and second, adjudication of possession. If the title dispute is removed and the title is established in one or the other, then, in effect, it becomes a suit for ejectment where the defendant must plead and prove why he must not be ejected. 67. In an action for recovery of possession of immovable property, or for protecting possession thereof, upon the legal title to the property being established, the possession or occupation of the property by a person other than the holder of the legal title will be presumed to have been under and in subordination to the legal title, and it will be for the person resisting a claim for recovery of possession or claiming a right to continue in possession, to establish that he has such a right. To put it differently, wherever pleadings and documents establish title to a particular property and possession is in question, it will be for the person in possession to give sufficiently detailed pleadings, particulars and documents to support his claim in order to continue in possession. 68. In order to do justice, it is necessary to direct the parties to give all details of pleadings with particulars. Once the title is prima facie established, it is for the person who is resisting the title holder’s claim to possession to plead with sufficient particularity on the basis of his claim to remain in possession and place before the Court all such documents as in the ordinary course of human affairs are expected to be there. Only if the pleadings are sufficient, would an issue be struck and the matter sent to trial, where the onus will be on him to prove the averred facts and documents. 69. The person averring a right to continue in possession shall, as far as possible, give a detailed particularized specific pleading along with documents to support his claim and details of subsequent conduct which establish his possession. 70. It would be imperative that one who claims possession must give all such details as enumerated hereunder. They are only illustrative and not exhaustive. a) who is or are the owner or owners of the property; b) title of the property; c) who is in possession of the title documents d) identity of the claimant or claimants to possession; e) the date of entry into possession; f) how he came into possession - whether he purchased the property or inherited or got the same in gift or by any other method; g) in case he purchased the property, what is the consideration; if he has taken it on rent, how much is the rent, license fee or lease amount; h) if taken on rent, license fee or lease - then insist on rent deed, license deed or lease deed; i) who are the persons in possession/occupation or otherwise living with him, in what capacity; as family members, friends or servants etc.; j) subsequent conduct, i.e., any event which might have extinguished his entitlement to possession or caused shift therein; and k) basis of his claim that not to deliver possession but continue in possession. 71. Apart from these pleadings, the Court must insist on documentary proof in support of the pleadings. All those documents would be relevant which come into existence after the transfer of title or possession or the encumbrance as is claimed. While dealing with the civil suits, at the threshold, the Court must carefully and critically examine pleadings and documents. 72. The Court will examine the pleadings for specificity as also the supporting material for sufficiency and then pass appropriate orders. 73. Discovery and production of documents and answers to interrogatories, together with an approach of considering what in ordinary course of human affairs is more likely to have been the probability, will prevent many a false claims or defences from sailing beyond the stage for issues. 74. If the pleadings do not give sufficient details, they will not raise an issue, and the Court can reject the claim or pass a decree on admission. 75. On vague pleadings, no issue arises. Only when he so establishes, does the question of framing an issue arise. Framing of issues is an extremely important stage in a civil trial. Judges are expected to carefully examine the pleadings and documents before framing of issues in a given case. 76. In pleadings, whenever a person claims right to continue in possession of another property, it becomes necessary for him to plead with specificity about who was the owner, on what date did he enter into possession, in what capacity and in what manner did he conduct his relationship with the owner over the years till the date of suit. He must also give details on what basis he is claiming a right to continue in possession. Until the pleadings raise a sufficient case, they will not constitute sufficient claim of defence. 77. XXXX XXXX XXXX 78. The Court must ensure that pleadings of a case must contain sufficient particulars. Insistence on details reduces the ability to put forward a non-existent or false claim or defence. 79. In dealing with a civil case, pleadings, title documents and relevant records play a vital role and that would ordinarily decide the fate of the case.”

RESTITUTION, MESNE PROFITS, COSTS, FALSE CLAIMS, COMPENSATORY COSTS RE-EXPLAINED WITH CITATIONS 2012 SC

READ FULL JUDGMENT
JUSTICE Dalveer Bhandari, & JUSTICE Dipak Misra of Supreme court of India in the case of A.Shanmugam vs Ariya, Decided on 27 April 2012, has held as follows:- Experience reveals that a large number of cases are filed on false claims or evasive pleas are introduced by the defendant to cause delay in the administration of justice and this can be sufficiently taken care of if the Courts adopt realistic approach granting restitution. ................. Unless wrongdoers are denied profit or undue benefit from frivolous litigations, it would be difficult to control frivolous and uncalled for litigations. Experience also reveals that our Courts have been very reluctant to grant the actual or realistic costs. We would like to explain this by giving this illustration. When a litigant is compelled to spend Rs.1 lac on a frivolous litigation there is hardly any justification in awarding Rs. 1,000/- as costs unless there are special circumstances of that case. We need to decide cases while keeping pragmatic realities in view. We have to ensure that unscrupulous litigant is not permitted to derive any benefit by abusing the judicial process. ......................

This Court in the case of Ramrameshwari Devi v. Nirmala Devi (2011) 8 SCC 249 in paragraph 52 (C, D and G) of the judgment dealt with the aspect of imposition of actual or realistic costs which are equally relevant for this case reads as under:- “C. Imposition of actual, realistic or proper costs and or ordering prosecution would go a long way in controlling the tendency of introducing false pleadings and forged and fabricated documents by the litigants. Imposition of heavy costs would also control unnecessary adjournments by the parties. In appropriate cases the courts may consider ordering prosecution otherwise it may not be possible to maintain purity and sanctity of judicial proceedings. D. The Court must adopt realistic and pragmatic approach in granting mesne profits. The Court must carefully keep in view the ground realities while granting mesne profits. G. The principle of restitution be fully applied in a pragmatic manner in order to do real and substantial justice.”

This Court in another important case in Indian Council for Enviro- Legal Action v. Union of India and Others (2011) 8 SCC 161 (of which one of us, Bhandari, J. was the author of the judgment) had an occasion to deal with the concept of restitution. The relevant paragraphs of that judgment dealing with relevant judgments are reproduced hereunder:-

193. This Court in Grindlays Bank Limited v. Income Tax Officer, Calcutta (1980) 2 SCC 191 observed as under :- “…When passing such orders the High Court draws on its inherent power to make all such orders as are necessary for doing complete justice between the parties. The interests of justice require that any undeserved or unfair advantage gained by a party invoking the jurisdiction of the court, by the mere circumstance that it has initiated a proceeding in the court, must be neutralised. The simple fact of the institution of litigation by itself should not be permitted to confer an advantage on the party responsible for it. …”

194. In Ram Krishna Verma and Others v. State of U.P. and Others (1992) 2 SCC 620 this Court observed as under :- “The 50 operators including the appellants/ private operators have been running their stage carriages by blatant abuse of the process of the court by delaying the hearing as directed in Jeevan Nath Bahl’s case and the High Court earlier thereto. As a fact, on the expiry of the initial period of grant after Sept. 29, 1959 they lost the right to obtain renewal or to ply their vehicles, as this Court declared the scheme to be operative. However, by sheer abuse of the process of law they are continuing to ply their vehicles pending hearing of the objections. This Court in Grindlays Bank Ltd. vs Income-tax Officer - [1990] 2 SCC 191 held that the High Court while exercising its power under Article 226 the interest of justice requires that any undeserved or unfair advantage gained by a party invoking the jurisdiction of the court must be neutralised. It was further held that the institution of the litigation by it should not be permitted to confer an unfair advantage on the party responsible for it. In the light of that law and in view of the power under Article 142(1) of the Constitution this Court, while exercising its jurisdiction would do complete justice and neutralise the unfair advantage gained by the 50 operators including the appellants in dragging the litigation to run the stage carriages on the approved route or area or portion thereof and forfeited their right to hearing of the objections filed by them to the draft scheme dated Feb. 26, 1959. …”

195. This Court in Kavita Trehan vs Balsara Hygiene Products (1994) 5 SCC 380 observed as under :-
“The jurisdiction to make restitution is inherent in every court and will be exercised whenever the justice of the case demands. It will be exercised under inherent powers where the case did not strictly fall within the ambit of Section 144. Section 144 opens with the words “Where and in so far as a decree or an order is varied or reversed in any appeal, revision or other proceeding or is set aside or modified in any suit instituted for the purpose, ...”. The instant case may not strictly fall within the terms of Section 144; but the aggrieved party in such a case can appeal to the larger and general powers of restitution inherent in every court.”

196. This Court in Marshall Sons & Co. (I) Ltd. v. Sahi Oretrans (P) Ltd. and Another (1999) 2 SCC 325 observed as under :-
“From the narration of the facts, though it appears to us, prima facie, that a decree in favour of the appellant is not being executed for some reason or the other, we do not think it proper at this stage to direct the respondent to deliver the possession to the appellant since the suit filed by the respondent is still pending. It is true that proceedings are dragged for a long time on one count or the other and on occasion become highly technical accompanied by unending prolixity, at every stage providing a legal trap to the unwary. Because of the delay unscrupulous parties to the proceedings take undue advantage and person who is in wrongful possession draws delight in delay in disposal of the cases by taking undue advantage of procedural complications. It is also known fact that after obtaining a decree for possession of immovable property, its execution takes long time. In such a situation for protecting the interest of judgment creditor, it is necessary to pass appropriate order so that reasonable mesne profit which may be equivalent to the market rent is paid by a person who is holding over the property. In appropriate cases, Court may appoint Receiver and direct the person who is holding over the property to act as an agent of the Receiver with a direction to deposit the royalty amount fixed by the Receiver or pass such other order which may meet the interest of justice. This may prevent further injury to the plaintiff in whose favour decree is passed and to protect the property including further alienation.”

197. In Padmawati v. Harijan Sewak Sangh - CM (Main) No.449 of 2002 decided by the Delhi high Court on 6.11.2008, the court held as under:-
“The case at hand shows that frivolous defences and frivolous litigation is a calculated venture involving no risks situation. You have only to engage professionals to prolong the litigation so as to deprive the rights of a person and enjoy the fruits of illegalities. I consider that in such cases where Court finds that using the Courts as a tool, a litigant has perpetuated illegalities or has perpetuated an illegal possession, the Court must impose costs on such litigants which should be equal to the benefits derived by the litigant and harm and deprivation suffered by the rightful person so as to check the frivolous litigation and prevent the people from reaping a rich harvest of illegal acts through the Court. One of the aims of every judicial system has to be to discourage unjust enrichment using Courts as a tool. The costs imposed by the Courts must in all cases should be the real costs equal to deprivation suffered by the rightful person.”

198. We approve the findings of the High Court of Delhi in the aforementioned case.

199. The Court also stated “Before parting with this case, we consider it necessary to observe that one of the main reasons for over- flowing of court dockets is the frivolous litigation in which the Courts are engaged by the litigants and which is dragged as long as possible. Even if these litigants ultimately loose the lis, they become the real victors and have the last laugh. This class of people who perpetuate illegal acts by obtaining stays and injunctions from the Courts must be made to pay the sufferer not only the entire illegal gains made by them as costs to the person deprived of his right and also must be burdened with exemplary costs. Faith of people in judiciary can only be sustained if the persons on the right side of the law do not feel that even if they keep fighting for justice in the Court and ultimately win, they would turn out to be a fool since winning a case after 20 or 30 years would make wrongdoer as real gainer, who had reaped the benefits for all those years. Thus, it becomes the duty of the Courts to see that such wrongdoers are discouraged at every step and even if they succeed in prolonging the litigation due to their money power, ultimately they must suffer the costs of all these years long litigation. Despite settled legal positions, the obvious wrong doers, use one after another tier of judicial review mechanism as a gamble, knowing fully well that dice is always loaded in their favour, since even if they lose, the time gained is the real gain. This situation must be redeemed by the Courts”. ................


208. In Marshall sons and Company (I) Limited v. Sahi Oretrans (P) Limited and Another (1999) 2 SCC 325 this Court in para 4 of the judgment observed as under:
“…It is true that proceedings are dragged for a long time on one count or the other and, on occasion, become highly technical accompanied by unending prolixity at every stage providing a legal trap to the unwary. Because of the delay, unscrupulous parties to the proceedings take undue advantage and a person who is in wrongful possession draws delight in delay in disposal of the cases by taking undue advantage of procedural complications. It is also a known fact that after obtaining a decree for possession of immovable property, its execution takes a long time. In such a situation, for protecting the interest of the judgment-creditor, it is necessary to pass appropriate orders so that reasonable mesne profit which may be equivalent to the market rent is paid by a person who is holding over the property. In appropriate cases, the court may appoint a Receiver and direct the person who is holding over the property to act as an agent of the Receiver with a direction to deposit the royalty amount fixed by the Receiver or pass such other order which may meet the interest of justice. This may prevent further injury to the plaintiff in whose favour the decree is passed and to protect the property including further alienation. …”

209. In Ouseph Mathai and Others v. M. Abdul Khadir (2002) 1 SCC 319 this Court reiterated the legal position that the stay granted by the Court does not confer a right upon a party and it is granted always subject to the final result of the matter in the Court and at the risk and costs of the party obtaining the stay. After the dismissal, of the lis, the party concerned is relegated to the position which existed prior to the filing of the petition in the Court which had granted the stay. Grant of stay does not automatically amount to extension of a statutory protection.

210. This Court in South Eastern Coalfields Limited v. State of M.P. and others (2003) 8 SCC 648 on examining the principle of restitution in para 26 of the judgment observed as under: “In our opinion, the principle of restitution takes care of this submission. The word “restitution” in its etymological sense means restoring to a party on the modification, variation or reversal of a decree or order, what has been lost to him in execution of decree or order of the court or in direct consequence of a decree or order (see Zafar Khan v. Board of Revenue, U.P - (1984) Supp SCC 505) In law, the term “restitution” is used in three senses: (i) return or restoration of some specific thing to its rightful owner or status; (ii) compensation for benefits derived from a wrong done to another; and (iii) compensation or reparation for the loss caused to another.”

211. The Court in para 28 of the aforesaid judgment very carefully mentioned that the litigation should not turn into a fruitful industry and observed as under:
“… … …Litigation may turn into a fruitful industry. Though litigation is not gambling yet there is an element of chance in every litigation. Unscrupulous litigants may feel encouraged to approach the courts, persuading the court to pass interlocutory orders favourable to them by making out a prima facie case when the issues are yet to be heard and determined on merits and if the concept of restitution is excluded from application to interim orders, then the litigant would stand to gain by swallowing the benefits yielding out of the interim order even though the battle has been lost at the end. This cannot be countenanced. We are, therefore, of the opinion that the successful party finally held entitled to a relief assessable in terms of money at the end of the litigation, is entitled to be compensated by award of interest at a suitable reasonable rate for the period for which the interim order of the court withholding the release of money had remained in operation.”

212. The Court in the aforesaid judgment also observed that once the doctrine of restitution is attracted, the interest is often a normal relief given in restitution. Such interest is not controlled by the provisions of the Interest Act of 1839 or 1978.

213. In a relatively recent judgment of this Court in Amarjeet Singh and Others v. Devi Ratan and Others (2010) 1 SCC 417 the Court in para 17 of the judgment observed as under:
“No litigant can derive any benefit from mere pendency of case in a court of law, as the interim order always merges in the final order to be passed in the case and if the writ petition is ultimately dismissed, the interim order stands nullified automatically. A party cannot be allowed to take any benefit of its own wrongs by getting an interim order and thereafter blame the court. The fact that the writ is found, ultimately, devoid of any merit, shows that a frivolous writ petition had been filed. The maxim actus curiae neminem gravabit, which means that the act of the court shall prejudice no one, becomes applicable in such a case. In such a fact situation the court is under an obligation to undo the wrong done to a party by the act of the court. Thus, any undeserved or unfair advantage gained by a party invoking the jurisdiction of the court must be neutralised, as the institution of litigation cannot be permitted to confer any advantage on a suitor from delayed action by the act of the court. … …”

215. In consonance with the concept of restitution, it was observed that courts should be careful and pass an order neutralizing the effect of all consequential orders passed in pursuance of the interim orders passed by the court. Such express directions may be necessary to check the rising trend among the litigants to secure the relief as an interim measure and then avoid adjudication on merits.

216. In consonance with the principle of equity, justice and good conscience judges should ensure that the legal process is not abused by the litigants in any manner. The court should never permit a litigant to perpetuate illegality by abusing the legal process. It is the bounden duty of the court to ensure that dishonesty and any attempt to abuse the legal process must be effectively curbed and the court must ensure that there is no wrongful, unauthorized or unjust gain for anyone by the abuse of the process of the court. One way to curb this tendency is to impose realistic costs, which the respondent or the defendant has in fact incurred in order to defend himself in the legal proceedings. The courts would be fully justified even imposing punitive costs where legal process has been abused. No one should be permitted to use the judicial process for earning undeserved gains or unjust profits. The court must effectively discourage fraudulent, unscrupulous and dishonest litigation.

217. The court’s constant endeavour must be to ensure that everyone gets just and fair treatment. The court while rendering justice must adopt a pragmatic approach and in appropriate cases realistic costs and compensation be ordered in order to discourage dishonest litigation. The object and true meaning of the concept of restitution cannot be achieved or accomplished unless the courts adopt a pragmatic approach in dealing with the cases.

218. This Court in a very recent case Ramrameshwari Devi and Others v. Nirmala Devi and Others 2011(6) Scale 677 had an occasion to deal with similar questions of law regarding imposition of realistic costs and restitution. One of us (Bhandari, J.) was the author of the judgment. It was observed in that case as under:
“While imposing costs we have to take into consideration pragmatic realities and be realistic what the defendants or the respondents had to actually incur in contesting the litigation before different courts. We have to also broadly take into consideration the prevalent fee structure of the lawyers and other miscellaneous expenses which have to be incurred towards drafting and filing of the counter affidavit, miscellaneous charges towards typing, photocopying, court fee etc.
The other factor which should not be forgotten while imposing costs is for how long the defendants or respondents were compelled to contest and defend the litigation in various courts. The appellants in the instant case have harassed the respondents to the hilt for four decades in a totally frivolous and dishonest litigation in various courts. The appellants have also wasted judicial time of the various courts for the last 40 years.”

PRINCIPLES OF LAW RESTATED BY SUPREME COURT FOR THE GUIDANCE OF COURTS IN HANDLING FRIVOLOUS LITIGATIONS 2012 SC

READ FULL JUDGMENT
JUSTICE Dalveer Bhandari, & JUSTICE Dipak Misra of Supreme court of India in the case of A.Shanmugam vs Ariya, Decided on 27 April 2012, has given broad principles of law as a guidance to courts.
1. It is the bounden duty of the Court to uphold the truth and do justice.
2. Every litigant is expected to state truth before the law court whether it is pleadings, affidavits or evidence. Dishonest and unscrupulous litigants have no place in law courts.
3. The ultimate object of the judicial proceedings is to discern the truth and do justice. It is imperative that pleadings and all other presentations before the court should be truthful.
4. Once the court discovers falsehood, concealment, distortion, obstruction or confusion in pleadings and documents, the court should in addition to full restitution impose appropriate costs. The court must ensure that there is no incentive for wrong doer in the temple of justice. Truth is the foundation of justice and it has to be the common endeavour of all to uphold the truth and no one should be permitted to pollute the stream of justice.
5. It is the bounden obligation of the Court to neutralize any unjust and/or undeserved benefit or advantage obtained by abusing the judicial process.
6. Watchman, caretaker or a servant employed to look after the property can never acquire interest in the property irrespective of his long possession. The watchman, caretaker or a servant is under an obligation to hand over the possession forthwith on demand. According to the principles of justice, equity and good conscience, Courts are not justified in protecting the possession of a watchman, caretaker or servant who was only allowed to live into the premises to look after the same.
7. The watchman, caretaker or agent holds the property of the principal only on behalf the principal. He acquires no right or interest whatsoever in such property irrespective of his long stay or possession.
8. The protection of the Court can be granted or extended to the person who has valid subsisting rent agreement, lease agreement or licence agreement in his favour.

KARNATAKA LAND LAWS

CASE LAW ON LAND LAWS