2022 LiveLaw (SC) 802

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION
B.R. GAVAI; J., C.T. RAVIKUMAR; J.
CIVIL APPEAL NOS. 5755-5756 OF 2011; SEPTEMBER 27, 2022
MORESHAR YADAORAO MAHAJAN versus VYANKATESH SITARAM BHEDI (D) THR. LRS. AND OTHERS

Code of Civil Procedure, 1973; Order I Rule 9 - A "necessary party" is a person who
ought to have been joined as a party and in whose absence no effective decree
could be passed at all by the court. It has been held that if a "necessary party" is
not impleaded, the suit itself is liable to be dismissed - For being a necessary party,
the twin test has to be satisfied. The first one is that there must be a right to some
relief against such party in respect of the controversies involved in the
proceedings. The second one is that no effective decree can be passed in the
absence of such a party. (Para 17-20)
Specific Relief Act, 1963 - Suit for specific performance - When suit property was
jointly owned by the defendant along with his wife and three sons, an effective
decree could not have been passed affecting the rights of the defendant's wife and
three sons without impleading them. (Para 19)
For Appellant(s) Mr. Rahul Chitnis, Adv. Mr. Chander Shekhar Ashri, AOR
For Respondent(s) Mr. Harin P. Raval, Sr. Adv. Mr. Satyajit A. Desai, Adv. Mr. Satya Kam Sharma,
Adv. Mr. Abhinav K. Mutyalwar, Adv. Mr. Siddharth Gautam, Adv. Mr. Gajanan N. Tirthkar, Adv. Mr.
Deb Deepa Majumdar, Adv. Ms. Anagha S. Desai, AOR
JUDGMENT
B.R. GAVAI, J.
1. These appeals challenge the judgment dated 3rd July 2008 passed by the learned
Single Judge of the High Court of Judicature at Bombay in Second Appeal No. 264 of
1996, thereby allowing the appeal filed by the respondents challenging the judgment
dated 13th June 1996 passed by the 2nd Additional District Judge, Yavatmal (hereinafter
referred to as the “Appellate Court”) in Regular Civil Appeal No. 61 of 1990 vide which
the Appellate Court confirmed the judgment dated 28th March 1990 passed by the Civil
Judge (Senior Division), Yavatmal (hereinafter referred to as the “trial court”) in Special
Civil Suit No. 21 of 1985 filed by the appellant vide which the trial court had decreed the
suit for specific performance filed by the present appellant.
2. The parties hereto are referred to in accordance with their status as before the trial
court.
3. The plaintiff is a doctor who was working in a Government Hospital. The plaintiff
was also in private practice. The plaintiff, for starting his private practice, took on rent a
part of the house of the defendant. It is the case of the plaintiff that subsequently, the
defendant was in financial need for his agricultural cultivation and household expenses
and therefore, he suggested to the plaintiff that he should purchase the said part of the
house which the plaintiff was occupying, together with an added portion. The plaintiff
accepted the said suggestion and an agreement to sell was entered into on 24th July
1984. As per the terms of the said agreement to sell, the defendant agreed to sell and
the plaintiff agreed to purchase the suit property for Rs.50,000/-. The plaintiff paid an

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amount of Rs.24,000/- on the date of the agreement and the defendant executed an
earnest note in favour of the plaintiff. As per the terms of the agreement to sell, the sale
deed was to be executed before 31st March 1985. It is the case of the plaintiff that on 31st
July 1984, the defendant again requested for money and on such request, the plaintiff
paid him an amount of Rs.6,000/-. It is also the case of the plaintiff that pursuant to the
aforesaid payment, he was put in possession of the suit property on 31st July 1984.
4. It is further the case of the plaintiff that he was always ready and willing to perform
his part of the agreement and therefore, he informed the defendant by registered letter
that he was willing to complete his part of the transaction before 31st March 1985.
However, the defendant replied to the said notice by alleging that the transaction was of
money lending and denied the execution of the sale deed. In this background, the plaintiff
filed a suit for specific performance before the trial court. The trial court, vide judgment
and decree dated 28th March 1990, decreed the suit and directed the defendant to
execute the sale deed by accepting the balance sale consideration as per the terms of
the agreement to sell. It further directed that if the defendant failed to execute the sale
deed, the same should be executed through the court. Being aggrieved thereby, the
defendant preferred an appeal before the Appellate Court which was also dismissed vide
judgment dated 13th June 1996.
5. The defendant thereafter preferred a second appeal before the High Court which
came to be partly allowed vide the impugned judgment. Though the High Court denied
the specific performance, it directed the defendant to refund the amount of Rs.30,000/-
along with an interest at the rate of 9% per annum from the date of the institution of the
suit till its realization. Hence, the present appeal is at the instance of the plaintiff.
6. We have heard Shri Rahul Chitnis, learned counsel appearing on behalf of the
appellant and Shri Harin P. Raval, learned Senior Counsel appearing on behalf of the
respondents.
7. Shri Chitnis submitted that a perusal of the agreement to sell would reveal that the
defendant had agreed to sell the property since he needed money for farming and
household expenses. He submitted that the suit property exclusively belonged to the
defendant and as such, the finding of the High Court that the suit property belonged to
the joint family of the defendant i.e., his wife and three sons, is untenable. He submitted
that, in any case, the sale deed was for meeting the legal necessities of the family and
as such, the High Court ought not to have interfered with the concurrent findings of fact.
8. Shri Chitnis further submitted that the trial court had held that, after partition, the
house had come to the share of the defendant. He submitted that both the trial court and
the Appellate Court have concurrently held that the transaction in question was for the
payment of antecedent debt and as such, it was not necessary to join other members of
the family or other co-owners or other co-parceners as party defendants. He submitted
that the concurrent findings ought not to have been interfered with by the High Court in
second appeal. Relying on the judgment of this Court in the case of Kasturi v.
Iyyamperumal and Others1, he submitted that it is only the parties to a contract who are
necessary parties. He further submitted that since the contract was between the plaintiff
and the defendant, it was not at all necessary to implead the defendant’s wife or sons as

1 (2005) 6 SCC 733

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party defendants. He therefore submitted that the High Court has erred in taking this
aspect into consideration while partly allowing the second appeal.
9. Shri Raval, on the contrary, submitted that the suit property was a property jointly
owned by the defendant, his wife and three sons. He therefore submitted that the suit
itself was not maintainable on account of non-joinder of other owners of the suit property.
10. Shri Raval further submitted that the learned Single Judge of the High Court has
rightly held that a mere agreement to alienate cannot be enforced against a son on the
ground that the agreement was effected by the father for a consideration which was
formed by his own antecedent debts. Shri Raval further submitted that a perusal of the
plaint itself would reveal that the plaintiff himself has admitted that the suit property was
owned by the defendant, his wife and three sons. The learned Senior Counsel submitted
that in view of this admission, the suit filed by the plaintiff was itself not tenable. He further
submitted that the Appellate Court, after having held that the trial court has erred in
holding that the suit property was the exclusive property of the defendant but was in fact
a joint property of the defendant, his wife and his three sons, has erred in dismissing the
appeal filed by the defendant. He too relies on the judgment of this Court in the case of
Kasturi (supra) to argue that it was not possible for the trial court to pass an effective
decree in the absence of necessary parties. Relying on the judgment of this Court in the
case of Mumbai International Airport Private Limited v. Regency Convention Centre
and Hotels Private Limited and Others2, he reiterated his submission that since the
wife and sons of the defendant were necessary parties, in their absence, an effective
decree could not have been passed. He also relies on the judgment of this Court in the
case of Poonam v. State of Uttar Pradesh and Others3.
11. A perusal of the plaint would reveal that the plaintiff himself, in paragraph (2), has
stated thus:
“2. That the defendant and his sons viz. (i) Laxman; (ii) Vivek and (iii) Jayant together with
defendant’s wife Sou. Saralabai constitutes a joint Hindu family governed by Bombay School of
Hindu Mitaksharia Law. (The defendant is the Karta of the family. The family inter-alia owns
residential premises within the limits of at Wani……”
12. The plaintiff has further averred in the plaint that in the month of July 1984, the
defendant got into financial difficulties and that he had no money to carry on his large
cultivation. The defendant also required money for his household expenses. It is further
averred that besides this, the defendant also had to pay some debts as there was no
prospect for the defendant to borrow money from the creditor.
13. It is the specific case of the defendant that initially, he had taken an amount of
Rs.24,000/- and thereafter, Rs.6,000/- from the plaintiff by way of loan for his personal
purposes. The defendant, in his written statement, has specifically stated that each of his
sons are managing their own properties and the defendant was not required to look after
their properties. The defendant has submitted that the other members of the family, i.e.,
his wife and sons had nothing to do with the amount borrowed by him from the plaintiff.
The defendant has stated that the borrowed amount was spent by him for himself. The
defendant has denied that the said transaction was binding upon other members of his
family. It is specifically averred by him that the said transaction was of money lending

2 (2010) 7 SCC 417

3 (2016) 2 SCC 779

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and the agreement was entered into only as a security towards the loan. The defendant
has subsequently stated thus:
“It is submitted that the defendant’s sons and wife are necessary parties to this suit and their non-
joinder is fettled to the suit. The suit is liable to be dismissed for non-joinder of necessary parties. It
is denied that the defendant’s sons must be deemed to have given their approval to the transactions.
It is submitted that deeming is always fictions and no suit can be decreed on fictions.”
14. It is to be noted that in spite of this specific objection, the plaintiff did not implead
the defendant’s wife and sons as party defendants.
15. Though the trial court framed the issue as to whether the suit was bad in law for
non-joinder of necessary parties, it answered the same against the defendant by holding
that the defendant was the absolute owner of the suit property and therefore, there was
no question of joinder of his wife and three sons.
16. The Appellate Court, vide its judgment, held that the observation of the trial court
that the suit property was the exclusive property of the defendant was not correct. It held
that though the property was partitioned, the property remained as joint with the
defendant, his wife and three sons. It further held that since the defendant represents the
entire family and since the transaction in question was for payment of an antecedent
debt, it was not necessary to join other members of the family or other co-owners or other
coparceners.
17. This Court, in the case of Mumbai International Airport Private Limited (supra),
has observed thus:
“15. A “necessary party” is a person who ought to have been joined as a party and in whose absence
no effective decree could be passed at all by the court. If a “necessary party” is not impleaded, the
suit itself is liable to be dismissed. A “proper party” is a party who, though not a necessary party, is
a person whose presence would enable the court to completely, effectively and adequately
adjudicate upon all matters in dispute in the suit, though he need not be a person in favour of or
against whom the decree is to be made. If a person is not found to be a proper or necessary party,
the court has no jurisdiction to implead him, against the wishes of the plaintiff. The fact that a person
is likely to secure a right/interest in a suit property, after the suit is decided against the plaintiff, will
not make such person a necessary party or a proper party to the suit for specific performance.”
18. It could thus be seen that a “necessary party” is a person who ought to have been
joined as a party and in whose absence no effective decree could be passed at all by the
court. It has been held that if a “necessary party” is not impleaded, the suit itself is liable
to be dismissed.
19. As already discussed hereinabove, the plaintiff himself has admitted in the plaint
that the suit property is jointly owned by the defendant, his wife and three sons. A specific
objection was also taken by the defendant in his written statement with regard to non-
joinder of necessary parties. Since the suit property was jointly owned by the defendant
along with his wife and three sons, an effective decree could not have been passed
affecting the rights of the defendant’s wife and three sons without impleading them. Even
in spite of the defendant taking an objection in that regard, the plaintiff has chosen not to
implead the defendant’s wife and three sons as party defendants. Insofar as the reliance
placed by Shri Chitnis on the judgment of this Court in the case of Kasturi (supra) is
concerned, the question therein was as to whether a person who claims independent title
and possession adversely to the title of a vendor could be a necessary party or not. In
this context, this Court held thus:
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“7. …….From the above, it is now clear that two tests are to be satisfied for determining the question
who is a necessary party. Tests are — (1) there must be a right to some relief against such party in
respect of the controversies involved in the proceedings; (2) no effective decree can be passed in
the absence of such party.”
20. It can thus be seen that what has been held by this Court is that for being a
necessary party, the twin test has to be satisfied. The first one is that there must be a
right to some relief against such party in respect of the controversies involved in the
proceedings. The second one is that no effective decree can be passed in the absence
of such a party.
21. In view of the plaintiff’s own admission that the suit property was jointly owned by
the defendant, his wife and three sons, no effective decree could have been passed in
their absence.
22. In that view of the matter, we find that no error can be noticed in the judgment of
the High Court. The appeals are therefore liable to be dismissed.
23. In any case, the High Court, in order to balance the equities, has partly decreed
the suit and directed the defendant to refund an amount of Rs.30,000/- with an interest
at the rate of 9% per annum from the date of institution of the suit till its realization. We
affirm this direction of the High Court.
24. In the result, the appeals are dismissed. Pending application(s), if any, shall stand
disposed of in the above terms. No order as to costs.

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