Specific Performance, Forum, Amendment and Parallel Proceedings
On 14 January 2023, A, a resident of Nizamabad, and B, a resident of Hyderabad, sign an agreement at Warangal for the sale of a plot at Karimnagar for ₹60 lakh. B pays ₹10 lakh as advance. The sale deed is to be executed by 30 June 2023. A does not execute it. On 1 August 2023, B files a suit for specific performance in the City Civil Court at Hyderabad. A applies under Order VII Rule 11(a) read with Section 9 CPC, contending that the Hyderabad court has no territorial jurisdiction. B then applies under Order VI Rule 17 to amend the plaint to add a declaration that A’s registered sale deed dated 5 July 2023 in favour of C is void. Issues were framed on 10 January 2024, and B’s evidence has begun. A also applies under Section 10 CPC to stay B’s suit because A had filed a suit for permanent injunction against B on 20 July 2023 in Karimnagar concerning the same plot.
1. Is the objection to the territorial jurisdiction of the Hyderabad court sustainable? What order should the court pass on the plaint?
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Under Section 16(c) CPC, a suit for specific performance of a contract relating to immovable property must be instituted in the court within whose local limits the property is situate. The plot is at Karimnagar; the Hyderabad court therefore lacks territorial jurisdiction. The place of execution at Warangal and B’s residence at Hyderabad do not confer jurisdiction for this relief. The objection is sustainable. Strictly, Order VII Rule 11(a) deals with absence of a cause of action, not territorial jurisdiction; the proper course is to treat the application as one under Order VII Rule 10 and return the plaint for presentation before the competent court at Karimnagar. The court should not dismiss the suit on merits. If the plaint is returned, the amendment and stay applications do not survive in the Hyderabad court.
2. Should B’s application for amendment be allowed at this stage?
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Order VI Rule 17 permits amendment at any stage, but the proviso bars an amendment after trial has commenced unless the court concludes that, despite due diligence, the party could not have raised the matter before commencement of trial. B knew of the sale deed dated 5 July 2023 before filing the suit on 1 August 2023. The declaration sought is not a subsequent event; it was available when the plaint was drafted. B has not shown due diligence. The amendment would also widen the scope of the suit and may prejudice A. The court should refuse leave. B is not without remedy: he may seek the declaration in a separate suit, subject to limitation and court fees. If the court treats the application as one for amendment to avoid multiplicity, it must still record reasons for bypassing the proviso; on these facts, refusal is the correct judgment call.
3. Is A entitled to stay under Section 10 CPC?
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Section 10 CPC requires that the matter in issue in the subsequent suit is directly and substantially in issue in a previously instituted suit between the same parties, and that the previous suit is pending in a court competent to try the subsequent suit. A’s Karimnagar suit for permanent injunction and B’s Hyderabad suit for specific performance do not have the same matter in issue. The former concerns possession and threatened dispossession; the latter concerns execution of a sale deed. The mere fact that both concern the same plot and the 2023 agreement is not enough. Moreover, the Hyderabad suit is in a court lacking territorial jurisdiction, so Section 10 cannot be used to retain it. The application for stay should be rejected; the plaint should be returned under Order VII Rule 10.