Bombay High Court Dismisses Suit Against Defendants, Citing Limitation and Lack of Contractual Privity
Plaintiff's Claim Against Defendants Nos. 2 to 9 Rejected Under Order VII Rule 11 of CPC, Deemed Barred by Limitation
In a significant ruling, the Bombay High Court has dismissed a suit filed by Shree Construction Company against Bagwe Housing Private Ltd. and other defendants, citing lack of privity of contract and expiration of the statutory limitation period. The decision was rendered on September 29, 2025, by Justice Kamal Khata in Interim Application No. 3262 of 2024.
The case revolved around Shree Construction Company's challenge to two Deeds of Surrender dated February 13, 2006, involving property development rights originally granted by Defendant Nos. 2 to 8 to Defendant No. 1, who subsequently engaged the plaintiff for construction activities. The plaintiff argued that these deeds, which revoked certain powers and conveyed segments of the property to Defendant No. 9, were invalid and claimed contractual rights against all defendants.
However, the court found that the plaintiff had knowledge of the deeds by December 21, 2009, as evidenced by a letter from the plaintiff's advocates. Consequently, any legal action should have been initiated by December 21, 2012, in accordance with Article 58 of the Limitation Act, 1963. The suit, filed on August 20, 2016, was deemed time-barred.
Justice Khata emphasized that the plaintiff failed to establish any contractual relationship with Defendant Nos. 2 to 9, noting that mere awareness of the deeds did not constitute privity of contract. The court further underscored that the plaintiff's cause of action lay solely against Defendant No. 1, with whom a contractual agreement existed.
The court reiterated the principles governing the rejection of a plaint under Order VII Rule 11 of the Code of Civil Procedure, 1908, emphasizing the need to dismiss frivolous litigation at the threshold to prevent unnecessary legal proceedings. The decision also referenced several Supreme Court judgments supporting the grounds for dismissal, including the necessity to avoid the prolongation of sham litigation.
The plaintiff's argument that the limitation period was deferred due to Defendant No. 1's obligation to obtain a Commencement Certificate was deemed untenable. The court concluded that no enforceable rights arose against Defendant Nos. 2 to 9 and dismissed the suit against them.
In light of the dismissal, a related Miscellaneous Civil Application seeking the transfer of another suit was also declared infructuous and dismissed. The court declined a request by the plaintiff's advocate for a stay on the decision.
Bottom Line:
Rejection of plaint under Order VII Rule 11 of the Code of Civil Procedure, 1908, due to lack of privity of contract and barred by limitation.
Statutory provision(s): Code of Civil Procedure, 1908 - Order VII Rule 11, Limitation Act, 1963 - Article 58
Amey Realty and Construction LLP, (Bombay) : Law Finder Doc Id # 2786260
