Allegations Of Fraud Must Be Specifically Averred In Plaint, Otherwise Plaintiffs Will Try To Get Suit Within Limitation By Clever Drafting: Supreme Court

"Even the averments and allegations in the plaint with respect to fraud are not supported by any further averments and allegations how the fraud has been committed/played. Mere stating in the plaint that a fraud has been played is not enough and the allegations of fraud must be specifically averred in the plaint, otherwise merely by using the word "fraud", the plaintiffs would try to get the suits within the limitation, which otherwise may be barred by limitation", a Bench of Justices MR Shah and Krishna Murari explained.

The Court was hearing a petition challenging the order of the Trial Court and High Court which entertained a suit on cancellation of a sale deed, which was already barred by limitation.

The original plaintiffs had filed the respective suits before the Trial Court for cancellation of the sale deed executed by the plaintiffs in favour of the appellant – original defendant as null and void and to declare that the plaintiffs are the absolute owners of the suit schedule property.

According to the plaintiffs, by fraudulent misrepresentation of the character of the document, i.e., as if it is a Joint Development Project, the defendant got the sale deeds and the plaintiffs, without knowing the contents of the documents, had executed it. The claim was that the plaintiffs came to know about this aspect only in April, 2015 and immediately thereafter, they had filed the present suits.

In response, the original defendant – appellant filed applications to reject the respective plaints under Order VII Rule 11(d) of the CPC mainly on the ground that the suits were clearly barred by the law of limitation.

The Trial Court dismissed the applications under Order VII Rule 11 of the CPC, observing that the issue of limitation is a mixed question of law and facts. Therefore, the suit is not required to be rejected at this stage, it said. The Madras High Court also confirmed the order of the Trial Court and dismissed the revision petition of the Appellants. This urged them to move the Supreme Court.

The Top Court, after consideration of the facts and opposing arguments, noted that that most of the cause of actions alleged are much prior to the execution of the registered Sale Deeds.

The Court also opined that nothing was mentioned in the plaint regarding the knowledge of the plaintiffs that the document was obtained by fraud or misrepresentation. In this regard, the Bench said,

The Court also said that it did not understand how on visiting the suit property, the plaintiffs could have known the contents of the sale deed and/or the knowledge about the alleged fraudulent sale.

According to the Court, the plaintiffs had resorted to "clever drafting" in order to bring their suit within the period of limitation.

With these observations, the Court set aside orders of the High Court as well as the Trial Court rejecting the respective applications under Order VII Rule 11 CPC and allowed the appeals.