can civil court hear case?
kulwinder singh
(Querist) 16 December 2012
This query is : Resolved
Mr A has agreed to buy agricultural land from Mr B. An agreement to sell contract is entered into between Mr A (purchaser) and Mr B (seller). On day of registration Sub-Registrar refuses to register agreement to sell contract on grounds that it is against Foreign Exchange Management Act as Mr A is an NRI and cannot buy agricultural land. Now Mr A has filed suit for specific performance in Civil Court against Mr B but still doesn't have permission from Reserve Bank of India for purchasing said agricultural land. Under section 34 FEMA act does Civil Court have authority to hear said case? Would Mr A need to get permission from Reserve Bank of India for purchasing said agricultural land before filing said suit for specific performance? Thank you for your assistance.
ajay sethi
(Expert) 16 December 2012
in the present case contract is incapable of performance . it is against law . you were ready and willing to perform your contactual obligations however sale agreement could not be regd as purchaser is NRI .
fightt he case on merits .
take the plea that no permission from RBi has been obtained for purchase of agricultural land
kulwinder singh
(Querist) 16 December 2012
Sir under section 34 FEMA act is it correct that Civil Court cannot entertain said suit for specific performance wherein Appellate Tribunal for Foreign Exchange has authority? Also under section 35 FEMA act?
Raj Kumar Makkad
(Expert) 16 December 2012
Yes. Civil court cannot hear the matters related with FEMA Act under its section 34 and only specific tribunal has got power to hear it under section 35.
File an application under Order 7 Rule 11 of CPC at the initial stage and get the suit cancelled/rejected
Nadeem Qureshi
(Expert) 16 December 2012
yes it is correct
34. Civil court not to have jurisdiction -
No civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which an Adjudicating Authority or the Appellate Tribunal or the Special Director (Appeals) is empowered by or under this Act to determine and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act.
Feel Free To Call
prabhakar singh
(Expert) 16 December 2012
Dear Author!
What I find that your view about section 34 and 35 of the FEMA Act is totally misplaced as the same applies to penal proceedings initiated under the Act by Adjudicating Authority or Appellate Tribunal can not be challenged in civil court and no injunction would granted in those cases against any order so passed under provisions of that act.
Your case is on a different footing and you do have a very valid and sound defense to suit.
However since the suit is for specific performance of an agreement to sale,such suit lies in civil court and civil court is vested with jurisdiction.
Yet you can use the advise of Ld. Makkad for moving application u/o 7 rule 11 (d)of C.P.C showing the court the land law of the state that bars an NRI from buying agricultural land in that state.Considering this aspect, the very agreement is illegal and void ab initio .
prabhakar singh
(Expert) 16 December 2012
Many of us are ignoring these words used in the section despite producing them "in respect of any matter which an Adjudicating Authority or the Appellate Tribunal or the Special Director (Appeals) is empowered by or under this Act "
prabhakar singh
(Expert) 16 December 2012
Let us ask a question to our self ?
Are in respect of any matter which an Adjudicating Authority or the Appellate Tribunal or the Special Director (Appeals) is empowered by or under this FEMA Act empowered to entertain specific performance suit if the case relate to an NRI?
Raj Kumar Makkad
(Expert) 16 December 2012
Mr. Singh has raised many vlauable suggestions meant for all of we experts.
kulwinder singh
(Querist) 16 December 2012
Sir because the petitioner did not get permission from Reserve Bank of India does his suit not go against Sections 35 and 34 of the Foreign Exchange Management Act? Aswell as sections 23,32,55,56 of Indian Contract Act?
Raj Kumar Makkad
(Expert) 16 December 2012
I do agree hence I have advised you to move an application under 7 Rule 11 of CPC.
kulwinder singh
(Querist) 16 December 2012
Sir if NRI petitioner does not have permission from Reserve Bank of India to buy agricultural land how can he file suit for specific performance?
Raj Kumar Makkad
(Expert) 16 December 2012
He cannot file hence the above noted application is required to be moved so that his case may be got rejected at the very initial stage.
kulwinder singh
(Querist) 16 December 2012
Thank you Sirs. I appreciate all of your assistance.
