Supreme Court Quashes Counterclaim In Specific Performance Suit; Orders That A Counterclaim Cannot Be Filed Against Co-Defendants Under Order VIII Rule 6A CPC
Kiran Raj
The Supreme Court Division Bench of Justice K. Vinod Chandran and Justice N. V. Anjaria set aside the lower courts’ orders that had allowed two defendants to pursue a counterclaim against a co-defendant in a suit for specific performance. The Bench held that such a counterclaim was not maintainable, clarifying that a counterclaim must be directed only against the plaintiff and must stem from a cause of action that is incidental or related to that of the plaintiff’s suit. The Court further permitted the defendants to remain as parties to enable the Trial Court to decide on issues concerning possession.
The appellant, plaintiff in a civil suit, sought specific performance of an alleged oral agreement dated 2 December 2002 for the sale of 0.93 acres of land by the first defendant. The plaintiff claimed that the entire sale consideration was paid through three demand drafts on 3 December 2002 and that possession of the property was delivered, upon which a boundary wall was constructed. The first defendant, in his written statement, stated that two other individuals were in possession of part of the land and that the suit was defective for non-joinder of necessary parties. He further contended that on 1 December 2002, a separate agreement had been made to sell 50 decimals of the same land to those two individuals for ₹2,95,000, partly paid by deposit.
Subsequently, the two individuals were impleaded as defendants and filed a written statement asserting an agreement to purchase the entire land for ₹5,50,000, alleging fraudulent alteration of figures in the plaintiff’s receipt. They raised a counterclaim seeking conveyance of the land from the first defendant. The Trial Court allowed the counterclaim, which the High Court upheld. The appellant challenged these orders, arguing that a counterclaim could not be maintained against co-defendants under Order VIII Rule 6A of the Code of Civil Procedure, 1908.
The Court observed that “even if the allegation of an agreement of sale with the 2nd and 3rd defendants is accepted, there is no contention that the amount agreed upon was paid to the 1st defendant or that they were always ready and willing to pay the balance sale consideration.” It noted that “in the written statement filed, the 2nd and 3rd defendants concede that 43 decimals of land was purchased by plaintiff’s father and their agreement was confined to purchase of 50 decimals of land.”
Examining precedent, the Bench referred to Rohit Singh v. State of Bihar, where it was stated that “a counter claim though can be based on different cause of action than that are put forth in the suit, it should be one incidental or connected with that cause of action and it has necessarily to be directed against the plaintiff and cannot be directed against the co-defendant.” The Court also cited Rajul Mano Shah v. Kiranbhai Shakrabhai Patel, noting that “the claim of specific performance is independent of the claim of partition,” and a counterclaim against the plaintiff could arise only after the establishment of a right against the original defendant.
The Court recorded that “the counter claim against the co-defendant cannot survive and the same has to be rejected.” It stated that “the 2nd and 3rd defendants… are found to have no concrete claim against the property,” and further observed that the impleadment was filed in 2006, beyond the limitation period for specific performance. The Bench clarified that the impleadment would remain valid solely to resolve possession issues in the pending suit.
The Court ordered: “the counter claim against the co-defendant cannot survive and the same has to be rejected. Impleadment of the 2nd and 3rd defendants though voluntarily made by themselves, saves the suit from the defect of non-joinder of necessary parties. We have not held on merits regarding the possession as such and it would be for the Trial Court to determine the same and if necessary, grant recovery of possession, if that is sought for by the plaintiff appropriately in the suit. The Civil Appeal is hence allowed, and the parties are left to agitate their cause before the Trial Court, leaving open all contentions except – that of the counter claim of the defendants 2 & 3, which stands set aside.”
Advocates Representing the Parties
For the Petitioner: Mr. Shikhil Suri, Sr. Adv. Mr. Ram Lal Roy, AOR
For the Respondents: Mr. Narender Hooda, Sr. Adv. Mr. Yuvraj Nandal, Adv. Mr. Shiv Bhatnagar, Adv. Ms. Pallvi Hooda, Adv. Ms. Kavya Manuja, Adv. Ms. Tannu, Adv. Dr. Surender Singh Hooda, AOR Mr. Sriram Parakkat, Adv. Mr. Sriram P., AOR Mr. Neha Kumari, Adv. Ms. Maneesha Sunil Kumar, Adv. Mr. Bajinder Singh, Adv.
Case Title: Sanjay Tiwari v. Yugal Kishore Prasad Sao & Others
Neutral Citation: 2025 INSC 1310
Case Number: Civil Appeal arising out of SLP(C) No.11050 of 2025
Bench: Justice K. Vinod Chandran, Justice N. V. Anjaria
