Case Note & Summary
The petitioners, M/s Bamco Tech Pvt. Ltd. and M/s S.M. Computers Pvt. Ltd., filed a writ petition challenging the rejection of their application under Order 7 Rule 11 of the Code of Civil Procedure, 1908 (CPC) by the Civil Judge, Senior Division, Pune. The respondent No.1, Ramdas Ranoji Bhakre, had filed a suit for specific performance of an agreement to sell immovable property against the petitioners and other respondents. The respondent No.1 claimed to be a guarantor who had paid the entire consideration and was in possession of the property. The petitioners argued that the suit was not maintainable as the guarantor had no right to sue for specific performance. The court examined the provisions of Section 15(b) of the Specific Relief Act, 1963, which allows a person who has paid the consideration on behalf of the purchaser to enforce the contract. The court held that the guarantor, having paid the consideration and being in possession, falls within this category and thus the suit is maintainable. The court also noted that the plaint disclosed a cause of action and could not be rejected under Order 7 Rule 11 CPC. The writ petition was dismissed, and the trial court was directed to proceed with the suit in accordance with law.
Headnote
A) Specific Relief Act, 1963 - Section 15(b) - Guarantor's Right to Sue - Maintainability of Suit - A guarantor who has paid the consideration and is in possession of the property under an agreement to sell is a person who has paid the consideration on behalf of the purchaser and is entitled to enforce the contract for specific performance. The suit by the guarantor is maintainable as he falls within the category of persons who may obtain specific performance under Section 15(b) of the Specific Relief Act, 1963. (Paras 4-6) B) Civil Procedure Code, 1908 - Order 7 Rule 11 - Rejection of Plaint - The court held that the plaint cannot be rejected under Order 7 Rule 11 CPC as the suit is not barred by law. The guarantor's suit for specific performance is maintainable and the plaint discloses a cause of action. (Para 6) C) Contract Act, 1872 - Section 126 - Guarantee - The guarantor, having paid the consideration and being in possession, has a sufficient interest in the property and can enforce the agreement. The relationship of guarantor does not preclude him from seeking specific performance. (Para 5)
Issue of Consideration
Whether a guarantor who has paid the consideration and is in possession of the property under an agreement to sell can maintain a suit for specific performance of the agreement against the vendor and other joint venture members.
Final Decision
The writ petition was dismissed. The court held that the suit by the guarantor for specific performance is maintainable and the plaint cannot be rejected under Order 7 Rule 11 CPC. The trial court was directed to proceed with the suit in accordance with law.
Law Points
- Guarantor's right to sue for specific performance
- Maintainability of suit by guarantor
- Section 15(b) Specific Relief Act
- 1963
- Agreement to sell immovable property
- Joint venture agreement
- Payment of consideration by guarantor
- Possession of property
- Right to enforce contract
