Relief of Declaration Not Mandatory Where Fraud Is Alleged : Bombay High Court Allows Partition Suit Despite Unchallenged Gift Deed

“When fraud is pleaded, the limitation begins to run only from the date of its discovery. The plaintiff cannot be shut out at the threshold merely for not seeking declaratory relief.” - Bombay High Court (Aurangabad Bench) dismissed an appeal challenging the maintainability of a partition suit filed without expressly seeking a declaration to set aside a registered gift deed. Justice Shailesh P. Brahme, while affirming the decision of the lower appellate court, held that allegations of fraud and misrepresentation can sustain a cause of action for partition, even if the impugned deed is not immediately challenged through declaratory relief.

The judgment is significant in its reaffirmation of the principle that Order 7 Rule 11 of the CPC cannot be invoked to reject a plaint merely because the suit appears weak or the plaintiff may ultimately fail, particularly when issues of fraud and limitation involve disputed facts.

The parties — Deelipkumar and Ramavtar Saboo, real brothers — had jointly purchased a property in Aurangabad on 10 June 2008. On 2 December 2014, Ramavtar executed a registered gift deed in favour of Deelipkumar, which was later followed by a correction deed. The plaintiff alleged that the deed was executed under misrepresentation, believing the transfer was nominal, to enable the appellant to raise a bank loan.

Crucially, a Memorandum of Understanding (MoU) was executed between the parties on 10 November 2017, whereby the appellant assured to re-transfer the property. When this assurance was not honoured and the plaintiff’s title was denied on 28 March 2019, Ramavtar filed Special Civil Suit No. 109 of 2019, seeking partition, possession, and injunction — without seeking declaratory relief to set aside the gift deed.

The Trial Court had rejected the plaint under Order 7 Rule 11(a) CPC, citing absence of cause of action, but declined to reject it under Order 7 Rule 11(d) on limitation grounds. The lower appellate court reversed the rejection and restored the suit. This led to the appeal before the High Court.

Whether a partition suit is maintainable without challenging a registered gift deed allegedly obtained by fraud?

Justice Brahme held that the plaint, when read meaningfully and in entirety, discloses a cause of action rooted in allegations of fraud, misrepresentation, and breach of trust.

“It has been categorically averred in the plaint that there was a foul play on the part of the appellant, a fraud was practised… At this juncture, it cannot be said that there is absolutely no cause of action.”

The Court emphasized that fraud vitiates all solemn acts, and where fraud is pleaded with particulars, the issue must go to trial.

The appellant’s argument that declaratory relief was mandatory before seeking partition was rejected:

“The transaction needs to be examined in the wake of Section 121 of the Transfer of Property Act. The claim is that it is void ab initio. Therefore... respondent is not required to solicit relief of declaration in respect of gift deed.”

Accordingly, the failure to include a prayer for declaration was not fatal to the maintainability of the suit at the preliminary stage.

Whether the suit was barred by limitation under Article 59 of the Limitation Act, 1963?

The appellant contended that the suit, filed in 2019, was barred as the gift deed was executed in 2014. However, the Court held that the issue of limitation was a mixed question of law and fact, particularly when fraud is alleged.

“Going by the plaint, on the said date [02.12.2014], even the respondent was not aware that it was a gift deed… the limitation would not commence immediately.”

The MoU of 2017 was pivotal in this analysis. The Court reasoned that the assurance of re-transfer indicated that the plaintiff continued to believe the arrangement was temporary:

“In my considered view, the memorandum of understanding corroborates the respondent’s theory that there was a cause of action and suit is within limitation.”

Thus, rejection under Order 7 Rule 11(d) for being time-barred was not justified.

The High Court comprehensively addressed the appellant’s reliance on various Supreme Court precedents, including Dahiben v. Arvindbhai, Rajendra Bajoria v. Hemant Kumar Jalan, K. Akbar Ali v. K. Umar Khan, and Ramisetty Venkatanna v. Nasyam Jamal Saheb. While acknowledging the legal propositions therein, the Court distinguished the present case on facts:

“The facts are distinguishable… This judgment will not help the appellant because the case at hand discloses that it's not a sham litigation and a full-fledged trial is required.”

Regarding Civil Revision Application No. 45/2020 involving the same parties in a parallel suit, Justice Brahme declined to treat it as binding precedent:

“Dismissal of Special Leave Petition without assigning specific reasons would not amount to confirmation… I independently conducted scrutiny and examined whether the plaint is liable to be rejected or not.”

Ultimately, the Court affirmed the findings of the lower appellate court and dismissed the appeal.

This judgment reinforces the view that technical grounds under Order 7 Rule 11 CPC cannot defeat a plausible claim based on allegations of fraud without a full trial. The Court made it clear that plaintiffs are not always required to seek declaratory relief at the threshold, especially when facts are disputed and demand evidentiary examination.

“The respondent may or may not succeed in the suit… but that cannot be a parameter to reject the plaint.”

The case sets a valuable precedent for plaintiffs alleging fraud in property transactions and underscores the nuanced application of Article 59 of the Limitation Act in such matters.

Date of Decision: 04 October 2025