Specific Performance and Third-Party Rights: Supreme Court's Ruling on Impleadment in Contract Disputes

The case of Gurmit Singh Bhatia v. Kiran Kant Robinson & Ors. concerns a dispute over the impleadment of a third party in a suit for specific performance of a contract. The Supreme Court had to decide whether a third party who purchased the suit property during the pendency of a case could be added as a defendant in a suit for specific performance.

Background of the Case

The original plaintiffs, Kiran Kant Robinson and another, filed a suit for specific performance of an agreement to sell, executed on 03.05.2005, by the original defendant (respondent no.1). While the suit was pending, despite an injunction restraining the sale of the property, the defendant executed a sale deed in favor of the appellant, Gurmit Singh Bhatia, on 10.07.2008.

The appellant (subsequent purchaser) then filed an application under Order 1 Rule 10 of the Civil Procedure Code (CPC) to be impleaded as a defendant in the suit, claiming that he had purchased the suit property and had a direct interest in the litigation. The trial court allowed the application, but the High Court set aside this order, holding that the appellant was neither a necessary nor a proper party in the suit.

Aggrieved by this decision, the appellant approached the Supreme Court.

Petitioner’s Arguments

The appellant, Gurmit Singh Bhatia, argued that:

He had purchased the suit property from the same vendor and had an interest in the proceedings.
The trial court correctly held that he was a necessary and proper party.
The principle of lis pendens (pendency of litigation) did not prevent him from being impleaded as a defendant.
The High Court erred in setting aside the trial court’s order without considering the implications of his purchase.

Respondent’s Arguments

The respondents (original plaintiffs) countered that:

The appellant purchased the suit property during the pendency of the case in violation of the injunction order.
The prior agreement to sell, upon which the appellant relied, was fabricated and forged.
Since the appellant was not a party to the original contract, he could not be added as a defendant.
As per the doctrine of dominus litis, the plaintiff has the right to choose whom to sue, and the appellant’s impleadment would alter the nature of the suit.

Supreme Court’s Observations

The Supreme Court examined whether the appellant could be added as a defendant in the suit for specific performance. The key findings were:

The appellant was not a party to the agreement to sell, which was the subject of the specific performance suit.
The concept of dominus litis (control over litigation) grants the plaintiff the discretion to sue the parties against whom relief is sought.
The principles laid down in Kasturi v. Iyyamperumal (2005) 6 SCC 733 apply, which state that a stranger to a contract cannot be added to a suit for specific performance.
The addition of the appellant would convert a simple suit for specific performance into a suit for title and possession, which is legally impermissible.
The appellant had no right to demand impleadment, as no relief was sought against him in the suit.

The Supreme Court observed:

“The plaintiff is the dominus litis and cannot be forced to add parties against whom he does not seek relief, unless the law compels such an addition.”

Final Judgment

The Supreme Court upheld the High Court’s decision and ruled that:

The appellant could not be impleaded as a defendant in the suit for specific performance.
The trial court had erred in allowing the impleadment application.
The original plaintiffs had the right to exclude the appellant from the suit.

Impact of the Judgment

This judgment has important implications for property disputes:

Confirms that a subsequent purchaser cannot interfere in a suit for specific performance.
Reinforces the principle of dominus litis in contract enforcement cases.
Prevents the enlargement of specific performance suits into title and possession disputes.
Establishes that an injunction against property transfer must be strictly followed.

Conclusion

The Supreme Court’s ruling clarifies the rights of parties in property disputes and strengthens the legal framework surrounding specific performance suits. By denying impleadment to a third party who purchased the property during litigation, the Court ensures that the plaintiff’s rights are preserved and the litigation process is not unnecessarily complicated.

Petitioner Name: Gurmit Singh Bhatia.
Respondent Name: Kiran Kant Robinson & Ors..
Judgment By: Justice D.Y. Chandrachud, Justice M.R. Shah.
Place Of Incident: Bilaspur, Chhattisgarh.
Judgment Date: 17-07-2019.

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