NAME:AAYAT ARSHAD SHAH

ROLL NO:05
SECTION A

TOPIC: Interpleader suit

Meaning and definition

‘To interplead‘ means to litigate with each other to settle a point concerning a third
party.

When the plaintiff on behalf of the claimant filed a suit for choosing the actual owner of the property
then it is called an interpleader suit. When a Plaintiff is not in the direct possession of the property or
thing, he files a suit. Petitioner has the indirect possession of the property. There is more than one
defendant in this suit. Because in this suit more than one defendant can file the suit for the claim of
property. When the actual owner of the property dies without transferring the property to anyone then
the property transfer becomes the interpleader suit. Other than that the plaintiff may file a suit for the
movable or immovable property to deliver the property to the defendant because more than one
person has filed a suit for the claim of property. Debt is required in this suit or some amount of
money for the dispute which is between two defendants. Defendants can claim some debt from
another defendant of the property. Only the plaintiff is the one who cannot claim any cost and is also
ready to deliver the property to the defendants. Interpleader is defined in Section 88 of the Civil
Procedure Court.
Difference between
Interpleader suit Impleader suit

In an impleader, suit defendant files a

lawsuit and brings the third party in his
1. The person who makes the interplea.
lawsuit who is not a part of the liability.

2. There is a chance for a third party to enter into a lawsuit Third-party is liable for the plaintiff’s claim
as their interest. against the defendant in the lawsuit.

3. Examples: A and B claim the property of her husband with Example: A is the person who slips and falls
C. C can sue A and B according to the interpleader suit in the in the owner’s house and caused an injury
court. A and B will litigate in court who owns the property. and then he sues the owner for his injury.
Interpleader suit in CPC
The main controversy or dispute in an interpleader suit is between the defendants who inter-plead
against each other, rather than between the plaintiff and the defendant of a case. An interpleader suit
is characterized by the fact that the plaintiff of the case is not especially involved in the subject
matter of the case. The primary and most important purpose of an interpleader suit is to have rival
defendants’ claims adjudicated, since there must be some debt, capital, or other property in dispute
between the defendants only. It basically means that an interpleader suit is initiated against each
other to settle a point regarding a third party.

In an interpleader suit, the plaintiff must be in a position of impartiality and non-arbitrariness. For
example: ‘A’ has a total of Rs. 10,000 in his hands, which is being claimed by ‘B’ and ‘C’ in
opposition to each other. ‘B’ and ‘C’ are sued by A in an interpleader suit. At the hearing, it was
discovered that ‘A’ had agreed with ‘B’ before the suit was filed that if ‘B’ won the suit, he would
accept only Rs. 9,000 from ‘A’ in complete fulfilment of his argument. Since ‘A’ has an interest in
the subject matter of the suit because of the arrangement, he is not entitled to file an interpleader suit.
The complaint should be dismissed.

Legal Provisions related to Interpleader Suits

Section 88 and Order XXXV of the Code of Civil Procedure, 1908 deals with the provisions related
to Interpleader suits.

Section 88 states the guidelines related to where an interpleader suit may be instituted, stating the
following ingredients of an interpleader suit:

1. There may be a similar mortgage, sum of money, or other movable or immovable property.

2. When two or more parties make claims against each other,

3. The person who is claiming the property must have no interest in it except for charges or
expenses and must be able to pay or deliver it to the rightful claimant.

4. A person who is claiming property may file an interpleader action against all claimants to
decide who will receive payment or delivery and to obtain indemnity for himself.
The Hon’ble Calcutta High Court held in Asan v. Saroda[1] that a suit is not interpleader if the
defendants do not complain adversely to each other, and the plaintiff does not admit the title of one
of the defendants or is willing to pay or deliver the property to him.

The proviso to section 88 further states, “Provided that no

such suit of interpleader shall be instituted where any suit is
pending in which the interests of both parties can properly be
decided.”
Order XXXV Rule 1 – Plaint in an interpleader suit

This rule requires the interpleader to state in his plaint that the plaintiff has no interest in the suit’s
subject matter or the defendants’ allegations individually. The interpleader must also claim
unequivocally that there is no conspiracy between the complainants and any of the defendants
throughout the case. The interpleader must list all the defendants’ arguments in the plaint, as well as
his willingness to put the property (if it is moveable) before the court. The Hon’ble Bombay High
Court held in Mangal Bhikaji Nagpase vs State of Maharashtra[2] that the plaintiff must affirm in
support of Rule 1 that he has no interest in the subject matter in dispute other than for charges or
costs.

Order XXXV Rule 2 – Payment of the thing claimed into court

This rule talks about the situation where the thing claimed is capable of being paid into court or
placed in the custody of the court, the plaintiff may be obliged to do so before he can be entitled to
any order in the suit. The Hon’ble Patna High Court held in Syed Shamshul Haque v. Sitaram Singh
& Ors.[3] That the court has discretion to make certain orders as to the subject matter in dispute, and
that the party in question must follow the order before seeking relief from the court.

Order XXXV Rule 3 – Procedure where Defendant is suing the Plaintiff

This rule provides that if either of the defendants in an interpleader suit is suing the plaintiff in
respect of the subject-matter of such suit, the court in which the suit against the plaintiff is pending
must, upon being informed by the court in which the interpleader-suit has been instituted, stay the
proceedings as against him; and his costs in the suit so stayed must be provided for in such suit.

Order XXXV Rule 4 – Procedure at first hearing

This rule empowers the court to rule that the plaintiff is released from all liabilities at the first
hearing, and as a necessary consequence, the court will grant the plaintiff his costs and dismiss the
case. If the court believes that all parties to the suit must be retained for the sake of justice, propriety,
and convenience, the plaintiff will not be discharged until the suit is finally resolved. If the court
deems it appropriate, it may order that any other issues be framed and tried concurrently with the
suit, and that any complainant (that is, the defendant in the interpleader suit) be made a plaintiff
instead of or in addition to the original plaintiff.

Order XXXV Rule 5 – Who cannot file Interpleader suit?

In the case of Jugal Kishore & Anr. V. Bhagwan Das[4], the court held that an agent cannot sue his
principal, and a tenant cannot sue his landlord for the purpose of forcing those principals/landlords to
interplead with persons other than those claiming through them.

Order XXXV Rule 6 – Charge of Plaintiff’s cost

This last rule of this order states that when an interpleader suit is properly initiated, the court will
compensate for the original plaintiff’s costs to be charged either by charging him a fee for the item
alleged by the defendants or claimants, or by some other similarly successful process.
Landmark case Laws

• Neeraj Sharma v. The District Sangpur Khadi Gram [5]

The Punjab and Haryana High court stated that agents and tenants are not allowed to file interpleader
suits against the principal and landlords, according to Order XXXV Rule 5 of Code of Civil
Procedure, 1908. A tenant cannot sue his landlord for pressuring him to interplead with someone
other than those who have filed a claim through him. If the other person is claiming the property
through the previous landlord and then demanding rent from the tenant, the tenant can file an
interpleader suit to resolve such disparate claims by two or more parties. But, if the other person is
claiming the right and interest in the property without any reference to the previous landlord and
demanding rent from the tenant, the tenant can file an interpleader suit to resolve such disparate
claims are not maintainable.

• Hanumanth vajhula Jagannadha v. Vajhula Annapurna Rajesswaramma [6]

Excess execution questions occur when property not included in or protected by the decree is
delivered in execution of the decree, a condition known as “action in excess of the decree” in law. In
such circumstances, an appeal under Section 47 of the Code of Civil Procedure, rather than a
separate action, is the appropriate recourse for the judgement debtor to reclaim the property delivered
more than the decree.

• Interpleader suit by agents

An Agent cannot file an interpleader suit against his owner or the party. He cannot even claim
anything from the tenant and landlord.

Smt. Mohan Devi V. SH. Gokal Chand And Anr

Facts of the case:

The tenant filed a case against the landlord in court under an interpleader suit for threatening them to
pay the rent of the house. But according to the tenant, he is paying the rent according to the date and
time. Defendant 1 claimed that he lowers the rent as the rent is 250/- per month but he lowers the rent
to 200/- per month. But after the relevant fact, it has been noticed that defendants tried to threaten the
tenant to pay the rent. When the written statement is given by the defendant he admitted that tenant is
paying 250/- per month. But according to order 33, rule 5 of CPC the suit is not maintainable. The
RC and E officer observed that the tenant did not give any evidence related to his shop and it is
clearly mentioned in the evidence that the tenant is not the owner of the shop and had let it out to one
Alladia. He accordingly declared that the shop was vacant.

•
• Interpleader suit by Railway Company
Railway company can file a suit against agent and third party under order 35 of rule 5.

Case law:
 1. Chhaganlal Himatlal vs. the Bombay, Baroda and Central India Railway
Facts of the case:

The railway company has filed a suit in the interpleader suit against the agent and third party
claiming consignor that the company is not an agent of the consignor. According to the provisions of
the railway act, the company is in direct contract with the consignor for the carriage of goods. So the
railway company has claimed that the company is not an agent of the consignor but they are in
contract with the consignor for the carriage of goods. The court gives the decision that in virtue of
Order XXXV, Rule 5 of the Civil Procedure Code, railway company is not competent to constitute
an interpleader suit as it was an agent of the consignors.

• Interpleader suit by tenants

No agents can sue their principles and no tenants can sue their landlords in the interpleader suit for
compelling him to interplead with other person makes a claim related to the tenants through the
landlord. If the other person is claiming the property with the old landlord who has no direct
possession of the property and tried to ask for the rent with the tenant. Then tenant can file an
interpleader suit.

Case law

Neeraj Sharma vs. The District Sangpur Gram

Facts of the case:

Shanti Devi who died in the year 1922 is the owner of the premises. After the death of the owner of
the premises the petitioner, Neeraj Sharma claimed that he is the owner of the premises. The
respondent takes the premises in dispute from Smt. Shanti Devi who is already dead. Then the
petitioner filed a petition for the application for ejectment of the respondent society on the ground of
non-payment of rent. After that, the petitioner filed a second petition based on the same ground. In
judgment, the provisions of Order 35 Rule 5 of C.P.C are not applicable to the case because the
plaintiff does not pointed out to anyone defendant to be his landlord.

• Charge for plaintiff cost

Where the thing claimed is capable of being paid into court or placed in the custody of the court, the
plaintiff may be required to pay or place it before he can be entitled to any order in the suit.

Interpleader suitcases
Rajan Sharma And Others vs Labh Singh And Others 6th may 2011

Facts of the case

The court finds no merit in the appeals. According to Order 35, Rule 5 of the Code of Civil
Procedure, which prohibits the tenant to file a suit against his landlord for the purpose of compelling
him to interplead with any person other than making claim through such landlord.

Car and Universal Finance Company Limited v. Caldwell

Facts of the cases:

The respondent is the owner of the Jaguar car. The third person has forced Mr. Caldwell to sell the
car for a cheque amount of 965 dollars and a deposit of 10 dollars. Respondent agrees to sell the car
and he sold the car and got the cheque and when he tried to convert the cheque into cash. The
cheques got dishonoured. The respondent goes to the police about the whole incident and also
informed this incident to the Automobile Association. The respondent told that Mr. Norris has sold
the car to different dealers. The judgment is given by the high court. The court said that the contract
was validly rescinded. It was so without communication, but through an unequivocal act of election,
demonstrating Caldwell no longer wishes to be bound.

• N.M.N. Duraiswami Chettiar v. Dindigul Urban Co-operative Bank Ltd

Facts of the case

The first has deposited the money of Rs 2000 in the bank in his savings account. After that, he
fulfilled the form of the bank to recover the amount of money he deposited in the bank in his savings
account. But his brother the second defendant has given notice to the bank that the money should not
be recovered of the 1st defendant because that money is the share of the family members also. Then
the suit has been filed by the bank against the defendant’s related to the debt. The council dismissed
the petition saying that Interpleader Suit is not maintainable and the second ground for dismissal of
petition is in regard to this deposit the relationship between the bank and the first defendant was that
of principal and agent.

• Satyanarain v. District Judge, Tonk & Ors

Facts of the case

The petitioner has filed a suit against the respondent. But the case gets dismissed by the civil judge.
Then the third petitioner has filed a case against petitioner to recover the rent along with the profit He
filed an interpleader suit. In the judgment of this case the judge dismissed the application of the
petitioner under Order 35 Rule 5 of CPC.

• Neeraj Sharma vs The District Sangpur Khadi Gram

Facts of the case

The respondent has filed a suit against the petitioner than again petitioner has filed an interpleader
suit against the respondent. Shanti Devi who died in the year 1922 is the owner of the premises. After
the death of the owner of the premises the petitioner, Neeraj Sharma claimed that he is the owner of
the premises. The respondent takes the premises in dispute from Smt. Shanti Devi who is already
dead. Then the petitioner filed a petition for the application for ejectment of the respondent society
on the ground of non-payment of rent. After that, the petitioner filed a second petition based on the
same ground. The Provisions of Order 35 Rule 5 C.P.C is not applicable in the case.

• Ashok Leyland v. State of Tamil Nadu

Facts of the case:

This is related to tax. The petitioner has the factory in which he manufactures the vehicles in the state
of Maharashtra and the state of Rajasthan. The petitioner claimed that he has regional offices where
his vehicles all governmental works are done related to tax and many more. The tax law came into
question. The judgment held that:

1. Section 6A does not create conclusive presumption as contended on behalf of the

assessee.

2. The order of assessing authority is accepting form F and passed during the assessment at
any point.

3. Its amenability to the power of reopening and revision depends upon the provisions of the
concerned sales tax enactments by virtue of the operation of section 9(2) of the Central
Act.

4. It is not possible to accept that an order under Section 6A(2) has an independent
existence.

5. An order refusing to accept Form F may or may not be applicable independently

depending upon the provisions of the sales tax enactments, but it is certainly capable of
being questioned if an appeal is preferred against the order of assessment.

6. If orders accepting Form F are sought to be reopened, it can be done as part of the
reopening of assessment or may be done independently, which would depend upon the
language of the relevant provisions of the concerned State Acts
Interpleader suit format

In the court of
Civil Judge at Delhi

Suit no. …………../19 …………

1. Rajan Sharma
New Delhi, Janakpuri …………………….. Plaintiff

2. Labh Singh
New Delhi, Saket …………………. Respondent

3. Labh Singh
New Delhi, ……………………..Respondent

Plaint under Order 35 Rule 1

The plaintiff respectfully states as follows;

(Matter of Rent Restriction)

1. Petitioner is the tenant of the shop

2. Respondents 1 and 2 are the owner of the shop

(Facts constituting a cause of action)

3. Respondent 1 and 2 have submitted that the interpleader suit filed by the petitioner is not
maintainable.

4. Filed a petition for ejectment on the ground of personal necessity.

5. Petitioner agreed to deposit the rent to the court.

6. The respondent no 1 and 2 have accepted this demand of petitioner of giving rent to the court.
According to Order 35, rule 5

7. The tenant has the right to file a suit against all the owners of the shop.
 8. The respondent’s suit is maintainable and has action.

9. Counsel for the petitioner is not applicable.

10. The suit is against the owner of the shop.

11. The tenant cannot file a suit against the landlord.

Jurisdiction

Tenant is not applicable to the suit.

The tenant cannot file a suit against landlord according to rule 35

The relief claimed: the plaintiff prays that

No relief claimed because this case gets dismissed because the tenant cannot file a suit against the landlord.

Place: ……………………….. Signature of the plaintiff

Plaintiff Advocate for

Verification

I,………….., verify that content from 1 to the last para is valid and correct according to my knowledge and belief
and is concealed there.

Signature

Plaintif
 The law enshrined in Section 88 and Order XXXV is one of the most relevant civil laws in
the country. This clause is intended to shield a person who has acted in good faith from potential
condemnation because he did not fulfil his duty, or in other words, it protects a person’s right to legal
costs who claims no interest in property or who is the complainant and to decide the correct argument
over the property or debt. If the courts do not protect or ignore such rights, an appeal can be filed
with the appellate court under Order XLIII Rule 1 of the Code of Civil Procedure, 1908.