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Order VII Rule 11(d) CPC: Plaint Can Either Be Rejected As A Whole Or Not At All

IN CIVIL APPEAL OF 2019, Madhav Prasad Aggarwal vs Axis Bank Ltd., the respondent bank gave loan facility to builder against a projec against mortgage of project property. The appellants had purchased flat in the said project and have been paying instalments and were in possession of letter of allotments and other correspondences but not registered deeds. The plaintiffs on becoming aware of the loan facility, filed a suit to force the builder to complete the project, reject the loan etc. and arrayed the respondent bank as a defendant. The respondent No.1­bank (defendant No.15) appeared in
the concerned suit and filed a notice of motion to reject the plaint against the bank, in exercise of powers under Order 7 Rule 11(d) of CPC on the ground that the suit(s) against the said respondent would be barred by provisions of Section 34 of SARFAESI Act. The bank's application was rejected by the Single Judge of the High Court holding that the facts of the present case clearly indicate that the cause of action and the reliefs claimed by the concerned plaintiff(s) fell within the excepted category and the bar under Section 34 read with Section 17 of SARFAESI Act would be no impediment in adjudicating the subject matter of the concerned suit. The Single Judge also rejected the argument/objection raised by the appellant(s) that it is impermissible to reject the plaint only against one of the defendant(s), in exercise of power under Order 7 Rule 11(d) of CPC by relying on the decision of the Division Bench of the same High Court in M.V. “Sea Success I” Vs. Liverpool and London Steamship Protection and Indemnity Association Ltd. and Ors. The bank's appeal against the order of the Single Judge was allowed by the Divisional Bench.

On appeal, the Supreme Court accepted the argument of the plaintiff and their reliance on the judgment in Sejal Glass Limited Vs. Navilan Merchants Private Limited, that the plaint cannot be rejected only against one of the defendant(s) but it could be rejected as a whole.

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