LAW OF PROPERTY

CASE COMMENT
SUPREME GENERAL FILMS EXCHANGE LTD.
V.
MAHARAJA SIR BRIJNATH SINGH JI DEO

ACKNOWLEDGEMENT

 INDEX

TABLE OF CASES 1
CASE DETAILS 2
FACTS OF THE CASE 3
STATEMENT OF ISSUES 4
ARGUMENTS ADVANCED BY PETITIONER 5
ARGUMENTS ADVANCED BY RESPONDENT 6
JUDGEMENT 9
CONCLUSION 11
SOURCES CITED 12

 TABLE OF CASES

• Bai Shri Vaktuba v. Thakore Agarsinghji Rai-singhji

• Bishan Singh & Ors. v. Khazan Singh & Anr

• Deokali Koer v. Kedar Nath

• Jayaram Mudaliar v. Ayyaswami & Ors

• Sheoparsan Singh v. Ramnandan Singh

• Suriya Kumar Dhar v. Girish Chandra Ghose & Anr.

 CASE DETAILS

CASE NAME

SUPREME GENERAL FILMS EXCHANGE LTD.

V.

HIS HIGHNESS MAHARAJA SIR BRIJNATH SINGHJI DEO OF MAIHAR & OR

CITATION

1975 AIR 1810

1976 SCR (1) 237
1975 SCC (2) 530

CASE NUMBER

Civil Appeal No. 1041 of 1968

COURT NAME

Supreme Court of India

BENCH

Beg, M. Hameedullah; GUPTA, A.C

DATE OF JUDGEMENT

04/08/1975

FACTS OF THE CASE

The former owners of a theater, the Bhatias, had borrowed Rs. 2,50,000/- from the Plaintiff-
Respondent, a Maharaja, against the security of bales of cotton. On 29-12-1951, they
executed a registered mortgage deed in respect of the Plaza Theater in favour of the plaintiff
as the price of pledged goods was insufficient to satisfy the dues. The plaintiff, unable to
recover the amount due, had brought Civil Suit No. 15A of 1954 in which a compromise
decree was passed on 7-5-1960, in terms of an agreement between the parties that amounts
due will be realized by the sale of Plaza Theater.

The Central Bank of India, another creditor of Bhatias, had brought Civil Suit No. 3B of
1952 and obtained a decree for Rs. 1,24,000 on 29-4-1952. Rights under this decree were
assigned in favour of the plaintiff-respondent. The Plaza Theater, together with other
properties of Bhatias, was attached on 4-5-1955 in the course of execution of that
decree.The appellant company claimed to be a lessee in occupation of the theater where it
had carried on the business of running a Cinema under an unregistered lease obtained on
27-2-1940. The lease of 1940 had expired on 10-4-1946. The Company continued as a
tenant holding over until the impugned lease deed of 30-3-1956 was executed. If this was a
valid lease, it would have conferred upon the company the right to be a tenant of the
property under the lease for eight years, from 10-2-1956 to 10-2-1964, with an option for a
renewal until 10-2-1970. This lease was executed after the company had filed a suit No. 16A
of 1954) on 20-11-1954 for the specific performance of an agreement to lease contained in a
letter dated 19-7-1948. A compromise decree was passed on 24-3-1956 in the suit. The lease
deed of 30-3-1956 purported to carry out the terms of that compromise decree passed in a
suit in which the plaintiff was not impleaded at all.

The plaintiff's case was that the lease of 30-3-1956 was void as it was struck by three
statutory provisions, namely, section 52 of the Transfer of Property Act, Section 65A of the
Transfer of Property Act, and Section 64 of the Civil Procedure Code. The defendant-
appellant company, in addition to denying the alleged rights of the plaintiff to the benefits of
these provisions, pleaded that a suit of the nature filed by the plaintiff did not lie at all as it
fell outside the purview of Section 42 of the Specific Relief Act, 1877, altogether.

The Trial Court and the High Court, after having over-ruled the pleas of the defendant-
appellant, had decreed the plaintiff's suit. The defendant company obtained special leave to
appeal to Supreme Court under Article 136 of the Constitution.

STATEMENT OF ISSUES

1. Whether declaratory relief can be granted outside the ambit of Section 42 of the Specific
Relief Act, 1877?

2. Whether the lease is void under Section 52 and Section 65-A of the Transfer of Property
Act and Section 64 of the Civil Procedure Code?

 ARGUMENTS ADVANCED BY PETITIONER

• Learned Counsel for the appellant company submitted that the plaintiff had neither a legal
character nor any such present right in any property for which a declaration could be
granted under Section 42 of the Specific Relief Act 1877 (re-enacted as Section 34 of the
Specific Relief Act of 1963). Furthermore, he contended that the defendant-company had
never denied any of the rights of the plaintiff.

• Finally, he submitted that, ill any case, no declaration at all was needed by the plaintiff if
the lease of 1956, executed by the former owners of the theatre in favour of the defendant-
appellant, was void. These arguments rest on the assumption that no declaratory relief can
be granted outside the ambit of Section 42 of The Specific Relief Act, 1877 which read as
follows:
"42. Discretion of Court as to declarations of status or right.. Any person entitled to any
legal character, or to any right as to any property, may institute a suit against any person
denying, or interested to deny, his title to such character or right, and the Court may in its
discretion make therein a declaration that he is so entitled, and the plaintiff need not in such
suit ask for any further relief: Bar to such declaration.. Provided that no Court shall make
any such declaration where the plaintiff, being able to seek further relief than a mere
declaration of title, omits to do so.

• Learned Counsel for the appellant sought to support his arguments by citing: Deokali
Koer v. Kedar Nath1; Sheoparsan Singh & ors. v. Ramnandan Singh2 (since deceased);
Bai Shri Vaktuba v. Thakore Agarsinghji Raisinghji; Kishori Lal v. Beg Raj & ors.3

1 ILR 1912 39 Cal 704

2 43 IA 91
3 ILR 34 Bom 676, 680
5

ARGUMENTS ADVANCED BY RESPONDENT

1. The declaratory relief can be granted outside the ambit of Section 42 of the Specific
Relief Act, 1877

• The circumstances in which a declaratory decree under Section 42 should be awarded is a

matter of the discretion depending upon the facts of each case. In the present case the
respondent had not only the rights of a mortgagee decree-holder with regard to the
property involved, but he was also the assignee of the rights of the Bank which had got
the property in question attached in execution of its decree.

• From connected special leave petitions against orders under Order 21, Rule 95, Civil
Procedure Code it is found that the respondent’s wife became the auction purchaser of this
property during the pendency of the litigation now before the court. At the time when he
filed the suit the respondent may have been looking forward to purchasing the property.
Therefore, the respondent possessed sufficient legal interest in the theatre, as a mortgagee
as well as an assignee of a decree holder who had got the property attached before he filed
his suit, so as to enable him to sue for the declarations he sought. He was not seeking a
merely whimsical or eccentric or an unreasonable declaration of a right in property with
no enforceable legal claims over it which could remain unaffected by the appellant’s
claims as a lessee.

• In a case law of Deokali Koer v. Kedar Nath4 it was held that the section does not
sanction every form of declaration, but only a declaration of any legal character or to any
right as to any property’; it is the disregard of this that accounts for the multiform and, at
times, eccentric declarations which find a place in Indian plaints. This was reiterated again
in Sheoparsan Singh v. Ramnandan Singh5 .

• In another case law of Bai Shri Vaktuba v. Thakore Agarsinghji Rai-singhji6 , it was held
by the court that the limit imposed by Section 42 is on decrees which are merely
declaratory and does not expressly extend to decrees in which relief is administered, and
declarations are embodied as introductory to that relief. For such declarations legislative
sanction is not required: they rest on long established practice. But for all that the Court
should be circumspect and even chary as to the declarations it makes: it is ordinarily
enough that relief should be granted without the declaration.

4 ILR 1912 39 Cal 704

5 43IA91
6 ILR 34 Bom 676, 680
6

• In Veruareddi Ramaraghava Reddy v. Konduru Seshu Reddy7 SC held that Section 42

of the Specific Relief Act is not exhaustive of the cases in which a declaratory decree may
be made and the courts have power to grant such a decree independently of the
requirements of the section. It follows, therefore, in the present case that the suit for a
declaration that the compromise decree is not binding on the deity is maintainable as
falling outside the purview of Section 42 of the Specific Relief Act.

• Therefore it is submitted that Section 42 merely gives statutory recognition to a well-

recognised type of declaratory relief and subjects it to a limitation, but it cannot be
deemed to exhaust every kind of declaratory relief or to circumscribe the jurisdiction of
courts to give declarations of right in appropriate cases falling outside Section 42.

2. The lease is void under Section 52 and Section 65-A of the Transfer of Property Act
and Section 64 of the Civil Procedure Code.

• The case fell outside the purview of Section 52 of the Transfer of Property Act as the
lease was executed in purported satisfaction of an antecedent claim rests upon the terms of
an agreement of 1948, embodied in a letter, on the strength of which the appellant had
filed his suit for specific performance. It was found that the terms of the compromise
decree in that suit and lease deed of 1956 purported to confer appellant new rights.
Indeed, there are good grounds for suspecting that the compromise in the suit for specific
performance was adopted as a device to get round legal difficulties in the execution of the
lease of 1956 in favour of the appellant company.

• In the case law of Bishan Singh v. Khazan Singh8 it was held that the lease was merely
an enforcement of an antecedent or pre-existing right. Therefore, it purported to create
entirely new rights pendente lite. It was, therefore, struck by the doctrine of lis pendens, as
explained by this Court in Jayaram Mudaliar v. Ayyaswami9 embodied in Section 52 of
the Transfer of Property Act.

• A case falling within Section 65A(2)(e) of the Transfer of Property Act, confining the
duration of a lease by a mortgagor to three years, being a special provision, is in
consonance with the provisions of Section 52 of the Transfer of Property Act and
therefore it vanishes the suit ultimately. As the special doctrine of lis pendens is applicable
here, the purported lease of 1956 was invalid from the outset. In this view of the matter, it
is necessary to consider the applicability of Section 65A(2)(e).

7 AIR 1967 SC 436

8 AIR 1958 SC 838
9 1972 2 SCC 200
7

 • As regards the applicability of Section 64, Civil Procedure Code, the attachment made by
the Central Bank on 20-4-1955, in execution of the decree of which the respondent was
the assignee, existed on the date the impugned lease of 30-3-1956. The order of the high
Court, passed on 30-4- 1960, in the same suit shows that a compromise had been arrived
at between the decree holder and the judgment debtor under which the decree holder had
agreed to lift attachment of property except with regard to Plaza Talkies which was to
continue. On these findings, the lease of 1956 was certainly struck by the provisions of
Section 64 Civil procedure Code also. Section 64, Civil Procedure Code, in fact,
constitutes an application of the doctrine of lis pendent in the circumstance specified
there.

JUDGEMENT

In Deokali's case, the learned Chief Justice pointed out that one declaration sought by the
plaintiff there seemed designed to get round the need to set aside a decree on grounds of
fraud and collusion. He held two other declarations sought to be vague. He, however,
explained : "I would only add this that the limit imposed by Section 42 is on decrees which
are merely declaratory, and does not expressly extend to decrees in which relief is
administered. and declarations are embodied as introductory to that relief. For such
declarations legislative sanction is not required: they rest on long established practice. But
for all that the Court should be circumspect and even chary as to the declarations it makes:
it is ordinarily enough that relief should be granted without the declaration".

It was held that the circumstances in which a declaratory decree under Section 42 should be
awarded is a matter of discretion depending upon the facts of each case. No doubt a
complete stranger whose interest is not affected by another's legal character or who has no
interest in another's property could not get a declaration under Section 42 Specific Relief
Act with reference to the legal character or the property involved. Such, however, was not
the case before the court.

The plaintiff-respondent, had not only the rights of a mortgagee decree-holder with regard
to the property involved, but he was also the assignee of the rights of the Bank which had
got the property in question attached in execution of its decree. It was found that, from
connected special leave petitions against orders under Order 21, Rule 95, Civil Procedure
Code that the plaintiff's wife became the auction purchaser of this property during the
pendency of the litigation now before us. At the time when he filed the suit the plaintiff may
have been looking forward to purchasing the property. Although, the mere possibility of
future rights of an intending purchaser could not, by itself, be enough to entitle him to get a
declaration relating to a purported lease affecting the right to possess and enjoy the property,
and that the plaintiff possessed sufficient legal interest in the theatre, as a mortgagee as well
as an assignee of a decree holder who had got the property attached before he filed his suit,
so as to enable him to sue for the declarations he sought. He was not seeking a merely
whimsical or eccentric or all unreasonable declaration of a right in property with no
enforceable legal claims over it which could remain unaffected by the defendant-appellant's
claims as a lessee.

Suriya Kumar Dhar v. Girish Chandra Ghose & Anr.10, was cited to contend that the
declaration sought by the plaintiff was unnecessary if the lease of the defendant-appellant
was void. The court held that from the pleadings in the case that the defendant-appellant had
actually denied the plaintiff's rights as a mortgagee and also the validity of the compromise
decree in suit No. 15A of 1954.

10 Appeal no. 477 of 1943

9

No doubt the plaintiff had not sought a decree for possession as that could not be granted at
the time when the suit was filed. Nevertheless, he had reasonable grounds to apprehend that
the defendant-appellant company will rely upon its alleged lease, as it did, in the course of
execution proceedings, to resist delivery of actual possession to an auction purchaser. The
existence of lessee rights would certainly affect the price an auction purchaser would be
prepared to pay for the property, or, in other words, what a mortgagee or one who had got
the property attached could realize for the property to satisfy his dues. Thus, the plaintiff
needed the declaration; and, in the circumstances of the case, the declarations sought for
could not be reasonably denied to him.

The contention that the case fell outside the purview of Section 52 of the Transfer of
Property Act as the lease was executed in purported satisfaction of an antecedent claim rests
upon the terms of an agreement of 1948, embodied in a letter, on the strength of which the
defendant-appellant had filed his suit for specific performance. The terms of the
compromise decree in that suit and lease-deed of 1956 purported to confer upon the
defendant-appellant new rights. Indeed, there are good grounds for suspecting that the
compromise in the suit for specific performance was adopted as a device to get round legal
difficulties in the execution of the lease of 1956 in favour of the defendant-company. The
court refused to accept the argument, sought to be supported by the citation of Bishan
Singh & Ors. v. Khazan Singh & Anr.11, that the lease was merely an enforcement of an
antecedent or pre-existing right. The court found that it purported to create entirely new
rights pendente lite. It was, therefore, struck by the doctrine of lis-pendens, as explained by
the Court in Jayaram Mudaliar v. Ayyaswami & Ors.12, embodied in Section 52 of the
Transfer of Property Act.

In consequence, the lease of 1956 was struck by the provisions of Section 64 Civil
procedure Code. Hence the appeal was dismissed.

11 1958 AIR 838

12 AIR 1973 SC 569
10

CONCLUSION

Relief from lis pendens being a discretionary relief, it will depend on several circumstances
such as the nature of the plaintiff’s case and the defense, the nature of property, and the
circumstances of the defendants. The right contemplated under Section 52 can be used,
undoubtedly, as a sword as well as a shield. This depends on the following factors - who is
the affected party, what right or interest is to be transferred and how is such transfer likely to
affect any party to the lis pendens.

The principle underlying this doctrine is that during the pendency of any suit regarding title
of a particular property, no new interest should be created in respect of that property.
Creation of a new interest or a title counts as a transfer of property. Hence, the doctrine of
lis pendens prohibits the transfer of property which has pending litigation.

The plaintiff's case was that the lease of March 30, 1956 was void as it was struck by three
statutory provisions, namely, Section 52 of the Transfer of Property Act, Section 65-A of the
Transfer of Property Act, and Section 64 of the Civil Procedure Code. The trial court and the
High Court, after having overruled the pleas of the defendant-appellant, had decreed the
plaintiff's suit.

Learned Counsel for the appellant Company tried to persuade the court to hold that the
plaintiff had neither a legal character nor any such present right in any property for which a
declaration could be granted under Section 42 of the Specific Relief Act 1877 (re-enacted as
Section 34 of the Specific Relief Act of 1963).

The lease of 1956 was certainly struck by the provisions of Section 64 Civil Procedure Code
also. Therefore the special leave petition was dismissed by the court.

11

SOURCES CITED

Virtual sources referred:-

https://indiankanoon.org/doc/1228368/

https://www.lawyerservices.in/Supreme-General-Films-Exchange-Limited-Versus-His-Highness-
Maharaja-Sir-Brijnath-Singhji-Deo-of-Maihar-and-R-1975-08-04

https://www.casemine.com/judgement/in/5609aba8e4b014971140d052

Statutes referred:-

Transfer of Property Act,1882

Specific Relief Act, 1877

12