Case Note & Summary
The petitioners, original plaintiffs, filed a Special Civil Suit for specific performance of an agreement to sell dated 01.08.2011. The respondent/defendant filed an application under Order 7 Rule 11 of the Code of Civil Procedure, 1908 (CPC) seeking rejection of the plaint on the ground that the agreement to sell was not duly stamped as required under the Maharashtra Stamp Act, 1958. The trial court allowed the application and rejected the plaint. The petitioners challenged this order by way of a writ petition before the Bombay High Court. The High Court examined the scope of Order 7 Rule 11 CPC and held that the grounds for rejection of plaint under that provision are limited to cases where the plaint does not disclose a cause of action, where the relief claimed is undervalued, where the plaint is insufficiently stamped, or where the suit appears to be barred by law. The court noted that the question of whether the agreement is duly stamped is not a ground for rejection of plaint under Order 7 Rule 11 CPC. Instead, it is a preliminary issue that can be decided under Order 14 Rule 2 CPC. The court further observed that even if the agreement is unstamped, the proper course is to impound the document and collect the requisite stamp duty and penalty, as provided under Section 34 of the Maharashtra Stamp Act, 1958. The court set aside the trial court's order and directed that the plaint be restored and the suit be proceeded with in accordance with law. The writ petition was allowed.
Headnote
A) Civil Procedure - Rejection of Plaint - Order 7 Rule 11 CPC - Suit for Specific Performance - Unstamped Agreement - The court considered whether a plaint can be rejected under Order 7 Rule 11 CPC on the ground that the agreement to sell is unstamped. Held that the question of stamp duty is a preliminary issue to be decided under Order 14 Rule 2 CPC and not a ground for rejection of plaint under Order 7 Rule 11 CPC. The trial court's order rejecting the plaint was set aside. (Paras 1-10) B) Stamp Act - Suit for Specific Performance - Section 34 of Maharashtra Stamp Act, 1958 - Section 35 of Indian Stamp Act, 1899 - The court held that an unstamped agreement to sell does not render the suit for specific performance non-maintainable. The proper course is to impound the document and collect stamp duty and penalty, not to reject the plaint. (Paras 5-10)
Issue of Consideration
Whether a suit for specific performance based on an unstamped agreement to sell is maintainable and whether the plaint can be rejected under Order 7 Rule 11 of the Code of Civil Procedure, 1908 on the ground that the agreement is not duly stamped.
Final Decision
The writ petition is allowed. The impugned order dated 30.01.2019 passed by the Civil Judge, Senior Division, Aurangabad in Special Civil Suit No. 330/2017 is set aside. The plaint is restored to its original number. The trial court is directed to proceed with the suit in accordance with law. Rule is made absolute accordingly.
Law Points
- Rejection of plaint under Order 7 Rule 11 CPC
- Suit for specific performance
- Unstamped agreement to sell
- Section 34 of Maharashtra Stamp Act
- 1958
- Section 35 of Indian Stamp Act
- 1899
- Maintainability of suit
- Preliminary issue under Order 14 Rule 2 CPC
