'Lis Pendens' Under O. XXI Rule 102 CPC To Transfer After Suit's Dismissal - Executing Court Should Determine If Transfer Was Before Appeal : Supreme Court

The Supreme Court has held that for applicability of Rule 102 Order XXI of the Civil Procedure Code, 1908 (“CPC”), the Executing Court would have to determine upon evidence whether the transfer of immovable property which was made post dismissal of suit, was made after institution of appeal/further litigation or not in order to attract the principle of lis pendens.

A suit for declaration of title was filed by the Plaintiff and the same was dismissed. Post dismissal, the Defendant transferred the Suit Property to third parties. However, the Plaintiff went in appeal and the suit was restored and eventually decreed in her favour. In execution proceedings, the third parties filed objections claiming their right over the Suit Property. The Plaintiff took shelter of Rule 102 Order XXI of CPC and claimed that transfer of suit property made during pendency of litigation confers no right upon such transferee.

The Bench comprising of Justice A.S. Bopanna and Justice Dipankar Dutta, while adjudicating an appeal filed in Jini Dhanrajgir & Anr. v Shibu Mathew & Anr., has observed that Section 47 of CPC confers exclusive jurisdiction on the Executing Court to prevent unnecessary litigation and to achieve speedy disposal of the questions arising in relation to the execution, discharge or satisfaction of the decree.

BACKGROUND FACTS

In 1987, Mrs. Cherian filed a suit for declaration of title in respect of land situated in Kerala (“Suit Property”), and recovery of possession from Mr. Mathew and others. Mrs. Cherian contended that Mr. Mathew was the caretaker of the Suit Property and had taken steps to purchase the same. Since the consideration amount was not paid in full, the sale could not be concluded. Nonetheless, Mr. Mathew and his family erected construction on the Suit Property.

To the contrary, Mr. Mathew submitted that he was declared a cultivating tenant by the Land Tribunal in 1993 and thus entitled to protection under the Kerala Land Reform Act, 1963 (“KLR Act”). Since a Purchase Certificate was issued to him, he was entitled to fixity of tenure on the Suit Property. Mrs. Cherian being aware of such Purchase Certificate, did not object to the same. During the pendency of the suit filed by Mrs. Cherian, Mr. Mathew sold part of Suit Property to third parties (Respondents).

In 1989, the Trial Court dismissed the suit and in 1998 the High Court restored the same, while holding that Mr. Mathews was not entitled to fixity of tenure. On 21.10.2000 the Suit was decreed and Mr. Mathews (now his legal heirs) were directed to put Mrs. Cherian in possession of the Suit Property. In appeal the Supreme Court had upheld the decree with minor modifications.

The children of Mrs. Cherian (“Appellants”) filed an execution application under Section 47 read with Order XXI Rule 97 of the Civil Procedure Code, 1908 (“CPC”) seeking enforcement of decree dated 21.10.2000. The third parties (Respondents), to whom part of Suit Property was partly sold during pendency of suit, filed objections to the execution petition.

Rule 97 Order XXI of CPC empowers the decree holder to seek assistance of Court if he/she is resisted from executing a decree of possession of immovable property. Under Rule 98 Order XXI of CPC, the Court can pass directions for the applicant to be put in possession of a property, the possession of which was being obstructed by third parties without cause. Under Rule 100 Order XXI of CPC, the Court can pass an order for putting the applicant in possession if he/she has been dispossessed. Further, Rule 102 Order XXI of CPC renders Rules 98 and 100 inapplicable to a person to whom judgment-debtor has transferred the suit property during pendency of the suit and is attempting to obstruct the execution of decree passed in such suit.

On 29.06.2018, the Executing Court passed an interim order holding the objections filed by third parties (Respondents) to be maintainable. It was observed that it is necessary to adjudicate the objections on their own merits, after due recording of evidence.

The Appellants field an appeal before the Supreme Court against the order dated 29.06.2018.

SUPREME COURT VERDICT

Section 47 of CPC confers exclusive jurisdiction upon Executing Court to prevent unnecessary litigation

The Bench opined that Section 47 of CPC mandates the Executing Court to determine all questions arising between the parties (or their representatives) to the suit in relation to the execution, discharge, or satisfaction of the decree, so that such questions may not be adjudicated in a separate suit.

“What is intended by conferring exclusive jurisdiction on the executing court is to prevent needless and unnecessary litigation and to achieve speedy disposal of the questions arising for discussion in relation to the execution, discharge or satisfaction of the decree”, the Bench observed.

Further, if any resistance or obstruction is raised, which impedes the execution of a decree made by a court of competent jurisdiction, then the Rules 97, 101 and 98 of Order XXI of CPC enable the executing court to adjudicate the inter se claims of the decree-holder and the third parties in the execution proceedings themselves, in order to avoid prolongation of litigation by driving the parties to institute independent suits.

Rule 102: Executing Court to determine upon evidence if transfer which was made post dismissal of suit, was made subsequent to institution of appeal/further proceedings to attract principle of lis pendens

On the issue of applicability of Rule 102 Order XXI of CPC, the Bench held that the executing court would have to determine based upon evidence whether the transfer of suit property was made post dismissal of suit, when no litigation was pending, or otherwise. It has been held as under:

“If, indeed, there have been transfers post dismissal of the Suit during the time when there was no pending lis, it would be most appropriate for the Executing Court to determine the question as to whether any of the transfers made by Mr. Mathew to the Respondents would attract Rule 102. This would indeed involve an exercise of leading of evidence by the parties and merely because the Suit was ultimately decreed on 21^st October 2000 and ultimately was upheld by this Court with a minor modification of the amount of compensation, that would not be sufficient justification to throw out the objections raised by the Respondents as being devoid of merit.”

The Bench upheld the order of the Executing Court while holding that the objections warrant an enquiry. The appeal has been dismissed.

Case Title: Jini Dhanrajgir & Anr. v Shibu Mathew & Anr.

Citation: 2023 LiveLaw (SC) 450

Counsel for Appellant: Shri Shyam Divan (Sr. Adv.)

Counsel for Respondent: Shri Chitambaresh (Sr. Adv.)

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