“The remedy under Order 7, Rule 11 is an independent and special remedy. In Azhar Hussain v. Rajiv Gandhi, 1986 Supp. SCC 315 this Court held that the whole purpose of conferment of powers under this provision is to ensure that a litigation which is meaningless, and bound to prove abortive, should not be permitted to waste judicial time of the Court. The power conferred on the Court to terminate a civil action is, however, a drastic one, and the conditions enumerated in Order 7, Rule 11 are required to be strictly adhered to.
A duty is cast on the Court to determine whether the plaint discloses a cause of action by scrutinizing the averments in the plaint, read in conjunction with the documents relied upon, or whether the suit is barred by any law. When a document referred to in the plaint, forms the basis of the plaint, it should be treated as a part of the plaint. The Court would determine if the assertions made in the plaint are contrary to statutory law, or judicial dicta, for deciding whether a case for rejecting the plaint at the threshold is made out. At this stage, the pleas in the written statement and application for rejection of the plaint on the merits would be irrelevant, and cannot be adverted to or taken into consideration.
In Hardesh Ores (P.) Ltd. v. Hede & Co., (2007) 5 SCC 614 the Court further held that it is not permissible to cull out a sentence or a passage, and to read it in isolation. It is the substance, and not merely the form, which has to be looked into. The plaint has to be construed as it stands, without addition or subtraction of words. If the allegations in the plaint prima facie show a cause of action, the Court cannot embark upon an enquiry whether the allegations are true in fact. If on a meaningful reading of the plaint, it is found that the suit is manifestly vexatious and without any merit, and does not disclose a right to sue, the Court would be justified in exercising the power under Order 7, Rule 11.
The power under Order 7, Rule 11 may be exercised by the Court at any stage of the suit, either before registering the plaint, or after issuing summons, or before conclusion of the trial, as held by this Court in Saleem Bhai v. State of Maharashtra, (2003) 1 SCC 557. The plea that once issues are framed, the matter must necessarily go to trial was repelled by this Court in Azhar Hussain.
The provision of Order 7, Rule 11 is mandatory in nature. It states that the plaint ‘shall’ be rejected if any of the grounds specified in clause (a) to (e) are made out. If the Court finds that the plaint does not disclose a cause of action, or that the suit is barred by any law, the Court has no option, but to reject the plaint.
The Court must be vigilant against any camouflage or suppression, and determine whether the litigation is utterly vexatious, and an abuse of the process of the Court.”
– Hon’ble Justice Indu Malhotra, Dahiben v. Arvindbhai Kalyanji Bhanusali, [Civil Appeal No. 9519 of 2019].