Gujarat High Court
Darpan (Ghatlodia) Cooperative ... vs Dahyabhai Maganbhai Rabari(Desai) @ ... on 31 March, 2022
Author: A. P. Thaker
Bench: A. P. Thaker
C/AO/306/2019 JUDGMENT DATED: 31/03/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/APPEAL FROM ORDER NO. 306 of 2019
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2019
In R/APPEAL FROM ORDER NO. 306 of 2019
FOR APPROVAL AND SIGNATURE:
HONOURABLE DR. JUSTICE A. P. THAKER
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1 Whether Reporters of Local Papers may be allowed No
to see the judgment ?
2 To be referred to the Reporter or not ? No
3 Whether their Lordships wish to see the fair copy No
of the judgment ?
4 Whether this case involves a substantial question No
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
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DARPAN (GHATLODIA) COOPERATIVE HOUSING SCOIETY LIMITED
THRU CHAIRMAN NARESH GANGARAM RATHOD
Versus
DAHYABHAI MAGANBHAI RABARI(DESAI) @ D.M.DESAI
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Appearance:
MS SEJAL K MANDAVIA(436) for the Appellant(s) No. 1
MR PATHIK M ACHARYA(3520) for the Respondent(s) No. 1
MS TRUSHA K PATEL(2434) for the Respondent(s) No. 2,3,4,5
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CORAM:HONOURABLE DR. JUSTICE A. P. THAKER
Date : 31/03/2022
ORAL JUDGMENT
1. Being aggrieved and dissatisfied with the order dated 8.3.2019 passed by learned 2nd Additional Senior Civil Judge, Ahmedabad (Rural) in Special Civil Suit No. 92 of Page 1 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 2018 below Exh-5 whereby the interim injunction filed by the present Appellant- plaintiff came to be rejected by the trial Court, the original plaintiff has preferred this Appeal from Order under Order 43 Rule 1(r) of the CPC.
2. For the brevity and convenience, the parties are referred to in this order as per the character assigned to them in the trial Court i.e. plaintiff and defendant.
3. The brief facts of the case of the plaintiff is that there was an agreement to sell between it and the defendant No.1 for the land bearing Khata No.883 paiki, Revenue Survey No. 157/1/1/ paiki- T.P. Scheme No.18 (Ghatlodiya), Final Plot No. 112, admeasuring 1059 sq. mtrs of land, which is an old tenure land. That there was an agreement to sell executed on 22.10.1997 and thereafter possession of the land was handed over to the plaintiff vide Notarised document dated 25.10.2004. According to the plaintiff, there was a condition to get the title cleared and then necessary registered sale deed was to be executed between the parties. It is the case of the plaintiff that as there was litigation regarding the title of the property, though part payment of the said transaction was paid to Page 2 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 the defendant and possession was handed over to the plaintiff by the defendant No.1, the defendant No.1 did not executed the sale-deed. That after clearance of title, instead of executing the sale-deed in favour of the plaintiff, the defendant No.1 has executed a registered sale deed in favour of respondent Nos. 2 to 5. In that view of the matter, the plaintiff has filed the aforesaid Special Civil Suit No. 92 of 2018 for specific performance of the Contract with an alternative prayer for compensation in terms of Rs. 3 Crore. Along with the plaint, the plaintiff has also filed an application at Exh-5 for interim injunction for restraining the defendant from creating any third party interest or dealing with the property or transferring to any other third party. The same came to be rejected by the trial Court by the impugned order.
4. Heard Ms. Sejal Mandavia, learned advocate for the appellant, Mr. Pathik M. Acharya, learned advocate for the defendant No.1 and Ms. Trusha Patel, learned advocate for the defendant Nos. 2 to 5 at length. Perused the material placed on record and decision cited at bar. Page 3 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022
5. Ms. Sejal Mandavia, learned advocate for the plaintiff-
appellant has vehemently submitted that there is no dispute regarding the execution of agreement to sale between the plaintiff and defendant No.1. She has submitted that at the relevant time part payment was paid to the defendant No.1 by the Society and after title clearance, the defendant No.1 had to execute the sale-deed in favour of the plaintiff. She has also submitted that in the year 2004, a document was executed before the Notary handing over the possession of the land in question to the plaintiff- Society. She has submitted that since title was not cleared, there was no execution of the sale-deed, but, as soon as order came to be passed by revenue authority, in a disputed case of revenue entry pertaining to the suit land, the defendant No.1, instead of executing the registered sale-deed in favour of the plaintiff, has executed the sale deed in favour of respondent Nos. 2 to 5. She has submitted that the defendant No.1 in written statement has only raised plea regarding limitation. However, according to Ms. Mandaliya, learned advocate for the plaintiff, since there is a transaction in respect of immovable property, time cannot be considered as essence Page 4 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 of the Contract. She has also submitted that since there was cloud over the title of the defendant No.1, the sale- deed could not be executed and, therefore, the condition of need to execute requisite sale deed in 9 months, must be read from the date of the title clearance of the defendant No.1.
5.1 Ms. Mandavia, learned advocate for the appellant has also vehemently submitted that when the possession was handed over to the plaintiff by the defendant No.1, even by executing sale deed in favour of the defendant Nos. 2 to 5, no title could be passed to the rest of the defendants. She has also submitted that since there is a breach of agreement to sell, and the same is in existence, the plaintiff had filed the Suit for Specific Performance of Contract and, therefore, interim injunction, if, not granted in favour of the plaintiff then there would be multiplicity of proceedings as in that case, the defendants may re-transfer it to somebody else or create any encumbrance upon the property. While referring to the impugned order of the trial Court, she has submitted that the trial Court has even not considered the entire documentary evidence on record and Page 5 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 in a cryptic manner passed the impugned order. She has also submitted that a Criminal Complaint has already been filed about the breach of trust against the defendant No.1. She has relied upon the following decisions and has prayed to set aside the impugned order and to pass interim injunction, restraining the defendants from dealing with the property till the final disposal of the Suit.
1. Narinderjit Singh v. North Star Estate promoters Limited, reported in (2012) 5 SCC 712;
2. Madina Begum and Another v. Shiv Murti Prasad Pandey and other, reported in (2016) 15 SCC 322.
6. Per contra, Ms. Trusha Patel, learned advocate for respondent Nos. 2 to 5, who are the purchasers of the land in question from defendant No.1, has vehemently argued that as per the agreement to sell only Rs. 1 Lakh has been paid to the defendant No.1 and as per Condition No.1 thereof, there was a specific period agreed between the parties to execute registered sale deed and that period was fixed as 9 months. She has submitted that 9 months have expired on 6.4.2010. According to her submission, since the agreement to sell is dated 6.3.2009, cause of action has Page 6 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 already started from that date and Suit ought to have been filed within the period of limitation. By referring to the Condition No.6, she has submitted that even possession was to be handed over only at the time of execution of registered sale-deed and, therefore, the version of the plaintiff that possession was handed over by Notarised document cannot be believed. She has submitted that the original owner has sold the property to the defendant Nos. 2 to 5 after 8 years and the sale consideration is almost Rs. 70 Lakh. She has also submitted that as per the agreement the land is an old tenure and even as per the order of the High Court dated 15.10.2001 land was held to be old tenure land. Therefore, even in the year 2001, it was known to the plaintiff that title of the defendant was clear and the plaintiff ought to have got the registered sale deed in its favour. She has also submitted that Society has even not applied for appropriate permission under Section 53 of the Societies Act. She has submitted that the defendant Nos. 2 to 5 are bonafide purchaser for value paid and suit is time barred and, therefore, no injunction could be passed in the matter. She has also submitted that considering the alternative prayer for compensation, there is no need of Page 7 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 passing any order of injunction. She has also submitted that even there is no pleading in the plaint as to readiness and willingness to perform its part of the contract by the plaintiff. She has relied upon the following decisions and has prayed to dismiss the present appeal and submitted that the trial Court has not committed any error of facts and law in rejecting the application for interim injunction.
1. Laxminagar Co-operative Housing Society Thro.
Organisor v. Mamlatdar and Agricultural Land Tribunal, reported in 2005 (3) GLR 2083;
2. Shaileshbhai Naranbhai Patel v. Nimeshbhai Prahladbhai Patel (Bhagat), reported in 2015 JX (Guj) 351;
3. Order dated 16.9.2019 passed by the Coordinate Bench in Appeal From Order No. 205 of 2014 and allied matters, in the case of Hitesh Ramanlal Patel v. Sentinel Properties Pvt. Ltd. & 1 Others;
4. Judgment of Division Bench of this Court dated 28.11.2017 passed in First Appeal No. 2566 of 2017 in the case of Vallabhbhai Kalyanji Prajapati v. Durlabhbhai Lallubhai Halpati & 9;
5. Best Sellers Retail (India) Pvt. Ltd v. Aditya Birla Nuvo Page 8 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 Limited, reported in AIR 2012 SC 2448;
6. Kanshi Ram v. Om Prakash Jawal and Others, reported in AIR 1996 SC 2150;
7. Nandkishore Lalbhai Mehta v. New Era Fabrics Private Limited, reported in 2015 (9) SCC 755;
8. Gunvantlal Ratanchand V. Rameshbhai P. Patel, reported in 2001 (1) GCD 1518;
9. Ashwinkumar Manilal Shah v. Chhotabhai Jethabhai Patel, reported in AIR 2001 Guj 90;
10. Kanubhai Sankalchand Patel v. Nayankunj Co-
operative Housing Society Limited, reported in 1978 GLR 1920;
11. Abdul Khader Rowther v. P.K. Sara Bai, reported in AIR 1990 SC 682;
12. Order dated 31.8.2010 passed by Division Bench of this court in Letters Patent Appeal No. 932 of 2000 in Special Civil Application No. 1491 of 1999 in the case of State of Gujarat & 2 v. Prathmesh Farms Pvt. Ltd & 1;
13. Veetrag Holding Co. Ltd. v. Gujarat State Textile Corporation Ltd, reported in 1996 (3) GLR 536;
14. K.S. Vidyanadam & Ors v. Vairavan, reported in 1997 Page 9 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 (2) SC 597;
15. Suryagandhi v. Lourduswamy, reported in AIR 2004 MADRAS 8;
16. Sameer Suresh Gupta Through Pa Holder V. Rahul Kumar Agarwal, reported in (2013) 9 SCC 374.
7. Mr. Pathik Acharya, learned advocate for the original owner i.e. defendant No.1 has adopted the arguments of Ms. Trusha Patel, learned advocate for the defendant Nos. 2 to 5 and in addition to that he has submitted that time was essence of the Contract as per the Condition No.1 and no possession was handed over to the plaintiff in the past as alleged by the Plaintiff. He has also submitted that consideration was to be paid within 9 months from the date of agreement to sell, however, entire consideration has not been paid to the defendant No.1. He has also submitted that the Suit is barred by law of limitation. He has supported the impugned order of the trial Court and prayed to dismiss the present Appeal from Order. He has relied upon the following decisions:
1. Ambalal Sarabhai Enterprise Limited v. K.S. Infraspace LLP Limited and Another, reported in (2020) 5 SCC Page 10 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 410.
8. In rejoinder, Ms. Sejal Mandavia for the plaintiff has submitted that all the conditions of the agreement to sell needs to be taken into consideration and since there was no title clearance got by the original owner, execution of the sale-deed could not be possible. She has also submitted that during the pendency of the Suit, the defendant has also moved an Application under Order 7 Rule 11 which came to be rejected by the trial Court. She has also submitted that the Suit is within time as title was cleared in the year 2017 only and there was litigation pending before this High Court as well as before Revenue Authority in respect of the land in question. She has submitted that the case is at the evidence stage but if no interim injunction is granted, then, there might be further sale or encumbrances created by the defendant Nos. 2 to 5 upon the land in question. She has prayed to allow the present appeal .
9. Now it is well settled that grant of relief in a Suit for Specific performance is discretionary remedy and the plaintiff seeking temporary injunction will have to establish a prima-facie case on the basis of undisputed facts. The Page 11 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 various authorities relied upon by both the sides deals with the Principles of granting or refusing the interim relief and the power of the Appellate court in interfering with the discretionary order passed by the trial Court.
10. Now, in this regard, the latest decision of the Apex Court in the case of Ambalal Sarabhai Enterprise Limited v. K.S. Infraspace LLP Limited and Another (Supra), needs to be referred to herein wherein Paras-15, 16 and 19 the following observations are made:
"15. Chapter VII, Section 36 of the Specific Relief Act, 1963 (hereinafter referred to as 'the Act') provides for grant of preventive relief. Section 37 provides that temporary injunction in a suit shall be regulated by the Code of Civil Procedure. The grant of relief in a suit for specific performance is itself a discretionary remedy. A plaintiff seeking temporary injunction in a suit for specific performance will therefore have to establish a strong prima- facie case on basis of undisputed facts. The conduct of the plaintiff will also be a very relevant consideration for purposes of injunction. The discretion at this stage has to be exercised judiciously and not arbitrarily."
"16. The cardinal principles for grant of temporary injunction were considered in Dalpat Kumar vs. Prahlad Singh, (1992) 1 SCC 719, observing as follows :
"5...Satisfaction that there is a prima facie case by itself is not sufficient to grant injunction. The Court further has to satisfy Page 12 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 that non-interference by the Court would result in "irreparable injury" to the party seeking relief and that there is no other remedy available to the party except one to grant injunction and he needs protection from the consequences of apprehended injury or dispossession. Irreparable injury, however, does not mean that there must be no physical possibility of repairing the injury, but means only that the injury must be a material one, namely one that cannot be adequately compensated by way of damages. The third condition also is that "the balance of convenience" must be in favour of granting injunction. The Court while granting or refusing to grant injunction should exercise sound judicial discretion to find the amount of substantial mischief or injury which is likely to be caused to the parties, if the injunction is refused and compare it with that which is likely to be caused to the other side if the injunction is granted. If on weighing competing possibilities or probabilities of likelihood of injury and if the Court considers that pending the suit, the subject matter should be maintained in status quo, an injunction would be issued. Thus the Court has to exercise its sound judicial discretion in granting or refusing the relief of ad interim injunction pending the suit."
"19. In a matter concerning grant of injunction, apart from the existence of a prima facie case, balance of convenience, irreparable injury, the conduct of the party seeking the equitable relief of injunction is also very essential to be considered as observed in Motilal Jain (supra) holding as follows :
"6. The first ground which the High Court took note of is the delay in filing the suit. It may be apt to bear in mind the following aspects of delay which are relevant in a case of specific performance of contract for sale of immovable property:
Page 13 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022
C/AO/306/2019 JUDGMENT DATED: 31/03/2022
(i) delay running beyond the period prescribed under the Limitation Act;
(ii) delay in cases where though the suit is within the period of limitation, yet:
(a) due to delay the third parties have acquired rights in the subject-matter of the suit;
(b) in the facts and circumstances of the case, delay may give rise to plea of waiver or otherwise it will be inequitable to grant a discretionary relief."
11. It is also well settled law that the Appellate Court may not interfere with the exercise of discretion of the Court of first instance and substitute its own discretion except where the discretion has been shown to have been exercised arbitrarily, or capriciously or perversely or where the Court had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. An appeal against exercise of discretion is said to be an appeal on principle. The Appellate Court will not reassess the material and seek to reach a conclusion different from the one reached by the Court below if the one reached by the court was reasonably possible on the material. The appellate Court would normally not be justified in interfering with the exercise of discretion under appeal solely on the ground that if it had Page 14 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 considered the matter at the trial stage it would have come to a contrary conclusion.
12. Now, it is also well settled Principle that in case of sale of immovable property, time is never regarded as essence of the Contract. Of course, by conduct or special condition, in an agreement to sell, specified period of time for execution of furhter sale-deed may be enumerated by the parties through mutual consent.
13. Now, considering the averments made on behalf of both the sides coupled with the material placed on record, it is undisputed fact that there is agreement to sell executed between the complainant and defendant No.1 in the year 2009 and defendant No.1 has also received consideration of Rs. 1 Lakh through Cheque. It also emerges from the record that defendant No.1 has not executed sale deed in favour of the plaintiff and has now soled the property in question to defendant Nos. 2 to 5 by registered sale deed. On perusal of the pleadings of the parties before the trial Court, it emerges that the only question raised by the original owner i.e. defendant No.1 is relating to the period of limitation relying upon the Condition No.1 in the Page 15 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 Agreement to Sell wherein the period is shown to be 9 months, whereas the defence taken by the defendant Nos. 2 to 5 i.e. new purchaser is that of bonafide purchaser with value paid and also on the ground of delay. Now on perusal of the material placed on record, it clearly reveals that there was litigation pending before this Court as well as before the revenue authority regarding the title clearance of the land. It also appears from the agreement to sell that there are many other conditions enumerated in the agreement to sell, one of which is obtaining on the part of the seller i.e. defendant No.1 to get it cleared and thereafter registered sale-deed was to be executed in favour of the plaintiff. Now, as revealed from the record, there was cloud over the title of the defendant No.1 till the year 2016-17. Under the circumstances, till the title of the defendant is not clear, there cannot be ground for plaintiff to insist for registered sale-deed. Considering the facts of the present case, it prima facie reveals that the point of limitation raised by the defendants' side is a mixed question of facts and law and, therefore, it needs a trial.
14. In view of the fact that there is no cancellation of Page 16 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 agreement to sell made by the defendant No.1 and the fact that the title came to be cleared in the year 2016-17, he ought to first inform the plaintiff for execution of the sale deed on the basis of earlier agreement to sell. However, in the present case no such course has been adopted and the defendant No.1 has sold the property in question to the defendant Nos. 2 to 5. Thus, propriety right of the plaintiff is at stake. If, during the pendency of the Suit, further transaction is carried out by the defendant's side then it may affect the right of the plaintiff and there will be multiplicity of proceedings. Now, so far as the alternative prayer of compensation is concerned, it needs to be observed that under Specific Relief Act, the alternative prayer may be asked by the plaintiff in case of Specific Performance to Contract. If in a given case, it is found by the Court that specific performance of the Contract is not possible, then in view thereof, the Court may pass an appropriate Order for awarding compensation thereof. Now, in the present case, the question raised by the defendant's side regarding the Tenancy Act is concerned, it pales into insignificance, in view of the fact that the title has been now got cleared by the defendant No.1 and he has Page 17 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 already sold the property to the rest of the defendants. Under the facts and circumstances of this case, it clearly transpires that all the three ingredients of the granting interim injuction i.e. prima-facie case, irreparable injury and balance of convenience are in favour of the plaintiff. At this juncture, it is pertinent to note that the trial Court has even not considered documentary evidence and the pleading before it in proper perspective. The order of the trial Court is cryptic one. Under this circumstances, since the trial Court has not considered the documentary evidence in its proper perspective and has materially erred in rejecting the application though the order of trial Court is discretionary one, it needs to be interfered with by this Court.
15. In view of the aforesaid discussion, present Appeal from Order needs to be allowed and hence it is allowed. The impugned order dated 8.3.2019 passed by learned 2nd Additional Senior Civil Judge, Ahmedabad (Rural) in Special Civil Suit No. 92 of 2018 below Exh-5 is hereby quashed and set-aside. The defendants are hereby restrained to sell, transfer, assign, gift, mortgage, and/ or to create any kind of third party interest in any manner, in the suit property till Page 18 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022 C/AO/306/2019 JUDGMENT DATED: 31/03/2022 the final disposal of the Suit. Considering the facts that Suit is of the year 2018 and it is at evidence stage, the trial Court is hereby directed to ensure earlier disposal of the Suit, as early as possible, preferably within a period of 3 months from the date of receipt of this order. The parties are directed to co-operate the trial Court for earlier disposal of the Suit.
No order as to costs.
In view of the above, the Civil Application also stands disposed of accordingly.
(DR. A. P. THAKER, J) SAJ GEORGE FURTHER ORDER After pronouncement of the judgment, learned advocate Ms. Trusha Patel for the defendant Nos. 2 to 5 submitted that this order be stayed.
However, considering the facts and circumstances of the case, the same is declined.
(DR. A. P. THAKER, J) SAJ GEORGE Page 19 of 19 Downloaded on : Thu Mar 31 21:43:52 IST 2022