Karnataka High Court
Sri A C Thirumalaraj vs M/S Aditya Birla Nuvo Ltd on 25 August, 2010
IN THE HIGH COURT OF KARNATAKA, BANGALORE
DATED THIS THE 25'" DAY OF AUGUST 2O}.OV.~=___
BEFORE
THE I-ION'BLE MR.JUs'rIc1: H.BILLm.§iaA é "
MFA.N0.4060/2010.{C,P__Q1 * d
BETWEEN:
Sri.A. C Thirumalaraj.
S/0.Sri.C.Kesav.
Aged about 81 years,
At Manohar Crest, No.175, V
Brigade Road, '_ V. _
Bangalore -- 560 001. ,"=.?--'A13pe11ant
(By Sri.Yoganarasimhé1, __Sr. . _
Sri.H.S.DWarkana_1'h)f. _.'
15% . V . . «.
1. M/s.Adi1;ya Birla'NuV(;..Ltd,','
Madura Cra1*mer1ts "D"N_isi'0.n;
Having its 'r,egiste1"ed?r)ffice at
Indjian Rayon'-Co'1npou'nd.
V¢;~r'a.va1'-- 362 268.; .....
.G1ijl1ré1f. H Q_
' Vvlis~regi{3r;ai~_0i'fi.ee at
"vRegenVt"Gateway", P101 No.58,
'-§)o'c1dana--I:;an'c11. KIADB Endl. Area.
1.*r,1P.L.VpQa'd.
V Bangaioredw 560 048.
Represented by its
., Power of Attorney Holder
" _ 'Srifxshish Dikshit,
Vs/o'.sri.Amamath Dikshit.
fkged about 41 years.
]x/.
la.)
2. M / s.Libe1-iy Agencies,
A Partnership Firm,
No.I91. Brigade Road,
Bangalore M 560 001.
3. Sri.A.'I'.Narer1drar1.
S/o.A.C.T11iruInalaraj.
Major, Partner,
M/s.Liberty Agencies, ..
No. 191, Brigade Road, I
Bangalore ~ 560 001.
4. Srnt-Arathi Narendran,
W/o.A.T. Narendran,
Major. Partner,
M / s.Li'oerty Agencies,
No.191, Brigade Road;
Bangalore -~ 560 001. B V
5. Msffejesvini. V I
D/o.Sri.A.T.Narender,
Major, Partn.er.. __ . I .
M/s.Libertj.'r Ag-é~nc'1'és., 0 B.
No.19}, Brigade Road, 3 ~-
Banga:o'ré'~e5Es,0 00:1"; "
6. Mr.Arjun;g = ..
S/o.Sri.A.T'.Narender,A=. V
Majo'r."P_artne1"; ., _ H V I
< M ,{':sL7Li'rJ.eriy Agencies, *
1' No.E91I Brigade Road.
' Ba'i1g&10rer 5 560_ 001 .
7. MB/h.s,rBesiauSellVers.Retail (India) Pvt. Ltd..
Afirivate .I.irnited Company
-- incorporated under the Companies Act. 1956
No. 191., Brigade Road.
" Bangalore -- 560 001.
its Director Mr.Naseer Ahmed. ...Respondeni.s
' V'V:g"(An1'end%ed vide Court Order dated 02.08.2010)
(By"Sri'.K.G.Ragha.van, Sr.Cour1se1 for
M'/;s.Rajesh 8: Rajesh or C/Rw2)
V.
(By Sri.Ash0k Haranahalli, AG for
P.S.Dinesh Kumar for R-7)
******
This M.F'.A. is filed under Order 43 Rule against the Order dated 24.04.2010 passed 0'
0.s.1533/2o10 on the file of the Addiftionai-'ItCity.'_jCi\ri1 0 Judge, Bangalore [CCH~ 8) aliowing Nt:)';e1..:'file€.i_0 t1n'derV:'O.rA(iier 39 Rules 1 and 2 R/w Sec.151 of sec ferfm. This M.F.A. coming on forivivflrders the Court delivered the following: _ _4 V JUhqM3NrQe< This appeal.-his-._ order dated 24»4»2010;"eeseiedv Afidiivtional City Civil Judge. Bangalore, on I.A.N0.1.
'By the " '-ir;}_p_1ggned order, the Trial Court has gi'anted injunction restraining the appellant and the vrespentients'i?§fte'e1= from leasing, sub--]easing, alienating or 01.0'eneumbe1~mg.t_the suit schedule property till. the disposal of
3. Aggrieved by that, the appellantwsecond defendant has filed this appeal.
4.(i) In brief, the facts are; The first respond_'e.rit_'w plaintiff has flied suit in O.S.No.1533/2010fi7or4.::'s'p'eeific performance of the agreement odated alternatively, for damages. The case tirst' plaintiff is that the first responde--nt*~i,s a in"
the marketing of garments and«"gar_rnent. accessories under the brand name and traderna_r'k"Va'n' 'Louis Philippe, Spiritus, Allen So.£};;t,:p Peter Frisco, Byford and Elements. first.'respo'ndent' has appointed the appellant and the respo'n.dents"2.l4to Sidaisdagent to conduct the business of the rcadyinade garments and accessories under the brand narne;'Louis Philippe' in the suit schedule premises. dd lV"l'h«%:'p:sLi:it'Vschedule property has been continuously used as 44a zflagshhlip store for the first respondent's brand 'Louis i'9h.ilipple"«..tpsince 1995 and the continued association has enhanced the persona}, professional and financial life of the appeliant and the respondents 2 to 6 and they have reaped huge benefits since 1995.
(iii) It is stated, the first respondent was make certain changes in the agreed terms and the fresh agreement dated 2~3~»2005.V.:
[iv] It is stated, the appeliant 6 agreed to seli the first respo_nfdent's.V' prod.iiC_tV"at""i'\To.19 Brigade Road, Banga1ore§5(§0 001"; to 's'hift"Ethe piace of business.
(V) is "a;ppei'1ant and the respondents 12 to 6 representeddthhe first that the premises is owned vybypthe and th'ej,7.jy_o1r1,1d keep possession of the premises till the" _exp_i'1y'«.ofv agreement period i.e., 12 years and the :77a/__agreementuvhas signed by the appeilant and the hrespondentsishand 4.
It is stated, the commission payable was per month and it was enhanced to 39,62,500/-- 6 as per letter dated 1m7~2008 and thereafter, it was redu___ced to ?.8,25,000/~ as per letter dated 26-1 120065.
(vii) Further it is stated, the appe.1l.a_n;t.VV respondents 2 to 6 have obtained respondent to the tune of ?.6.G.Q_O,OC')VO_/_'--"' as dated 23/M2008.
(viii) It is stated, notified the breach of terms ao.nCl..e'_onditi0ns.'ionAstfireraldlpjoeeasions but, the appellant and not set them right.
(ix) first respondent has been put to mental agony and Further it is stated, the appellant. and the " respondents 2 to 6 have been trying to er.eate"--thir.d'party interest in the suit schedule property to Id"i..__defeatothie the first respondent under the agreement l»,,,__dated and to make unlawfui gain. It is also stated. first'-..respondent has issued legal notice dated 6m2m20l0 V" upon the appellant and the respondents 2 to 6 to V htlomply math the terms of the agreement. It is stated, the first 1"
respondent has not committed any breach and has made all payments to the appellant and the respondents 2 to 6. (X) It is stated, on 27-2-20l0, the appel1antV:a:n:dp:"the respondents 2 to 6 tried to remove the the stock of the first respondent b respondent has lodged the Compplaint'.vv:1th police.
[Xi] It is stated, thefirstwrespopndent received letter dated 26-2-2010, on M2010. it.:_:isvAA.'.jstated in the said letter that tehe"ffilrr'd has been Changed and it is in violation of the'.l..the agreement which provides that the (2-onstitt'1tior1»o'f th-ellfilrrri shall not be changed and the €sh'al.1 not be Areloeated.
it is stated, the first respondent _ «,___understands. appellant and the respondents 2 to 6 ~»intendin,g~ to cheat the first respondent by letting out the preinisesito the third parties and deprive the first respondent. .its__legitimate right over the suit schedule property. [/2
(xiii). Further it is stated, in the letter dated 26-2-2010, it is stated that the premises is owned by Thirumalrajt--and it is leased to the firm which amounts to misrepresentatioiifi'-It is stated, the appellant and the respondents represented that they are the owners' o'f«th--e premises and have continued to represe,I1t_1ike that'til1'~
(xiv). It is stated, the appellantand 2 to' 6 have committed not to. i*eEoca_telllltl'1e;'businessto"any other place. It is stated, the evictionproceeclingsqrnentioned in the letter are not \x7ith;inl'i1h;e kn1oWledge"0:f respondent and the evictior1.'proceedif1g:sihafiebeen initiated with the oblique motive of defeating of the first respondent and the suit iscizgllusive. It"--Vis_, ____ therefore, the first respondent has pra_yed"'for-,_vspeeifiC_ performance of the agreement dated " Vv2~3-2Oil).E3Vl and lait.er"native1y, for damages.
5. 2' ..'l;'l*ie.l4iirst respondent has filed application for injunction under Order XXXIX Rules 1 and 2 of 9
6. The appellant has filed his written statement and objections to the IA contending as follows:--
[i) That the suit is not rnaintainable.
respondent is a franchise agreement holder and~.__r1ot'rall1esis.ee V' or a mortgagee or a owner or the licensee' of t--he-:suit'.SCheduie premises. The appellant is the solrell'-ownerjj schedule property. The appellantvtias resigned froh} firm' during December 2009. connection with the firm and the first ifespozlildleirit:hasl.fno.'-~locus standi to question the act ofappellazif. =
(ii) a ~l the first respondent is a franchise agreernevntl' the appellant is the owner and therefore, questionwof first respondent being offered by the oth--e_r respondents to do the business as agents does not varise.'-:l.I*t~'is'V the second respondent and its partners have tallienlgthe suit schedule property on lease from the ahd they were doing business and the first re's'pondent is in no way connected with the suit schedule ' f L A 10
(iii) It is stated, the appellant issued notice dated 30--9~2009 to retire from the firm and the partners acvcelppted it and the firm has been reconstituted on 17» 12--200'.§f' ' pp.
(iv) Further it is stated, the avppel1ant"--«go.t notice to the partners of the second respondentlv_to"vacat.e'->:he, premises and the demand was l"no"tl.met the appellant filed suit in lfor_ejecti"on"and it has been decreed and the second' to vacate the premises by 5--3--§30li{0§'Therefore, respondent has issued letter 'the first respondent intimatingl:AaboutlV and shifting of the stock to another locatiorri _
- It is ..stated;Wthe appellant took vacant possession and cannot claim any daniages as the first respon_dent?'has not suffered any loss.
A Further it is stated, the first respondent opened it more shops in the Brigade road and therefore, the 1/ il business of the second respondent coliapsed. it is stated, the first respondent has violated the spirit. of the agreement.
(vii) Further it is stated, the second responde'11t:'vv_asV a tenant and the suit has been decreed and second respondent has shifted the 1'11-';1t»€:1"i4alS_'l No.i78, Manohar Crest. Above Health "C}lo;\7:r,l"
Brigade road, Banga1ore~56O is stat.ed:,._:"t}*1e"j suite scheduie property is in thepcusto-dy.. 'the appellant and the appellant has leased ont --..in favour of M/s.Bestseller indial and has received advance an1_ou--n't ; 4
(viii) Theealplropertyll to the appellant and the second respondent been evicted and it is the prerogative ofdeal with the property as he likes.
H is stated, the first respondent without claimingll interest, in the property is claiming the relief «which is not permissible in law.
L 1') ;..
(X) it is stated, the first respondent can remove the interiors by 3-4-2010 and if the interiors are not removed, the appellant would remove the same.
(xi) It is therefore, the appellant dismissal of the suit and the LA.
'7. The defendant No.4 i.e:;.,4 t;'aef herein has filed her written statement clontendinig *
(a) The first respondent m,_1ml.)"er.l_oi° showrooms across the country and and the second respondent landrttlrte haitelentered into an agreement dated respondent and the commission payable was inere_ased-- to*?l.9.;l62,500/-- from ?.'?,50,000/- per I-inoiith ..arealiXfaslVinereased to 2505 sq.ft. from 2000 sql'ft.'lland' of ?.60,00,000/-- was given for interiors it wasv_ .1'e<_:oivAerab1e from the commission payable to the 0' " it respondent.
L E3
(b) it is stated. the second respondent is ready to give the material and the premises is no longer with the's_'eeo--nd respondent.
[c] Further it is stated, the:=.A'second not committed any breach and the."
because of three more shops es_tablis]'i_ed Brigade Road.
(d) Further"i_tVg:is statedifthedlisyecovnd'respondent is not trying to create" and the premises belonged theseeond respondent was the tenant for ejection and it was decreed therefore, possession had to be delivered to lllfhirwgnialaraj and thereifore, the second respondent shifted the'--- No.i78, Manohar Crest, Above Adllllviiealth 8;" ,n5(A}low, First Floor, Brigade Road, or i.".j53f1§&lore. +560 001.
l;(e) it is stated, the suit schedule property is in the ciistody of Thirurnalaraj i.e., the appellant herein and he has 1/ 14 let out the premises to M/s.Bestseller Retail India Private Limited and has received the advance amount of ?.50,00,000/--.
(fl Further it is stated. the second addressed a letter dated 26~2--2010_to_the _.fi'rst--i:iies'p:oi'2.de.nt' informing that the property belongs 1*-to has evicted the second responden_t';*~
(g) It is stated, Hthe'11on~_'availabVilitylpof premises is not due to second respondent respondent is ready to
(h) Further' the first respondent has not paid the» commisspionil' for the months of December 2009, lF.ebruarvllll201O and the amount payable is (lit)-~..__ stated, the agreement dated 2-3-2005 was into: between the first respondent and the second and it provided that the second respondent shall 1% rassed» 1.5 ret.ain possession of the premises No.19], Brigade Road, Bangalore~560 001 and sell the product of the first respondent and the second respondent shall guarantee of ?.50,00,000/~ and the first the minimum assured income of ?.7,5O,QQO/V' it was increased to 39,62,500/~ and temporarily it was reduced tc;lsV%;sp,25,'ooo/3 firsts' respondent is liable to pay surn,o--f [j] It is stated, Thirurnalaraj retired from the respondent was the tenant under him arid-.Tliirnrnalaraj filed suit for ejection and the second respondent agreed» for ejection and order has been » {K} .It'«is>sltated, the second respondent had no option and Hthherieforefjrrenioved the articles to premises No.178, 'la._&.Ma,noharl Crnstlllabove Health and Glow, I floor, Brigade Road, ~d60 001 and informed the first respondent. L/at I6 (1) Further it is stated. the first respondent has invoked the Bank guarantees for ?.50,00,000/~ and it is without authority of law. It is also stated, respondent has committed default and allowed.-:three,i'p:'-moire' shops to come up in the Brigade Road_,...on_e at_--'Res'idency "
and three at Garuda Mall and therefore. Was'~irriplossib'l~el'i1or the second respondent to do the0b_usinesAs'. _ .
(m) It is stated, the 'first yr-e-sponldent has-_,n0t'§ paid the amount for the months January and February 2010 andfgthe ii'rstl'respondent were shifted oniy --.onIt '0 is also stated, the first respondent has" not electricity charges for the months_~ lD'1eeember .2__0_Q9, January and February 2010 and trouser"alterat.io.n"c_harges from May 2008 to February 2010.
t..__'I'herefor'c; t1ae0l--tf;;uu3:th respondent has claimed ?'.1,09,05,926/m {nil .. stated, the second respondent informed the respondent that the contract stood terminated. It is also stated;, the first respondent had given loan of ?.60,00,000/»-- 17 for renovation and it had to be repaid in sixty monthly installments. It is stated, the second respondentglvrlepaid substantial amount and the interiors were made§'_Ti:o'tl___1e _ business of the first respondent and the secondi:i*es'p:orident' has no objection for the first responiderit to "~rernoife.g "t1.'r_i'e interiors. It is also stated. second hasf requested the appellant to keepg,t.hVe'v.prernises'intact and the appellant has obliged interiors till 3-4-2010.
(o) It therefore, fourth; respondent has prayed for dismissal of
8. ..'1Thetu'Trial.'TCourt":has allowed I.A.No.1 and has 'Vgrar1f,e§=1,.,"injunction restraining the appellant and the from leasing, sub--leasing, alienating or AlVf'e:ncumb«erinvg' suit schedule property in any manner till .. i,".fneg."disposal---- of the suit. Therefore, this appeal. 15/, 18
9. The learned counsel for the appellant has .__urged and also has filed written submissions. eonter1jdi.:f1_'§l'~»--as follows: ~ (1) That the first respondentvhas.4nofulrightiltolllenforeeldif the agreement as there is no privity 'of Zcoriltraet__l:aetwee_n«._the appellant and the first respondent;
(ii) There is no on Show that the first respondent 3I1d'.thC IndianjRayon "industries Limited are one and the4.sa.m=fj}'d__._»_ ~ 1
(iii) the firm was not the owner of the appellant who is the owner of the premises)"
' ;(iv]V respondent has invoked bank guarantee and therefore. by conduct, the first respondentlhasdl opted for the damages. The first respondent cannot compel the agent to if property in a particular way.
L/i 19
(vi) The suit filed by the appellant has been decreed and the firm has been ejected.
{vii} The agent could not have either.V__p'erfo;5rnedd obligation or kept the property, in viety of '
(viii) The agent can renouince the__ ageijcyfandj the'? remedy is by way of damages.
(ix) The contract is of movable properties and therefore, terminab_1e=in' nattire. (X) rnaintainable and specific performance in View of section 14(a) (b) and (d) of-the Specific. Reiiet for specific performance of agency 'V'z__agreei"nent andej-iswale of movable properties is not perrnissibie _ law. Reliiance was placed on MHU /WE /O E 40 / 1994. When loss could be ascertained, the suit for T s_p'ecific performance is not maintainable. L/ 20
(xiii) Sec 41(1)(e) of the Specific Reiief Act and section 38(3) of the Specific Relief Act read with section 10 (a), (13) and
(d) of the Specific Re1iefAct bars the suit of this natuzfet
(xiv) When maintainability of the suit injunction cannot be granted. Re1iar1'ce.wa,-a 2001 Karnataka page 212.
(xv) The agreement is not 1"e\gistere'd'and. no existed in the immovable prope1'?tjf~..and:ther.efore.,._ no «injunction can be granted and the agreernent't" looked into. Reliance uf=sLs"ttp1a;gr¢¢;1 MASH/ac7'%679/2008 and 1975 (1) Kb} page '- Vt 'V Z 2 (xfi). The suit'-Vi.sV__not for enforcing the negative covenant a11_d';th~.<=: H_1a~j_n.._A"1'e_1ief cannot be granted and therefore, Vinjunc.ti"on earn;-ofe1=he granted. (xxrii). em 39 Ruie 2 of ore is not applicable. 1/.
71 (Xviii) There is no prima facie case or balance of convenience or irreparable injury to the first respondent and therefore. injunction cannot be granted. (xix) The Court shouid look into the both the parties and pass appropriate_ord_e1'S.j' it " 'id' » {xx} For termination of agency', not c'ontract..is and it is a matter of law.
[xxi) There can be, no specific'<.perfo1'Inanc.é suit to enforce the agency agreement' a'»con'tract for personal service. AIR 1976 SC page 888, MANU/MH/0345[2V0O'2V,'. -- it 5}.ection"w..:§t§(3)'tc} of Specific Relief Act prohibits intvunctiori _if=1o'ss'*--can be ascertained and section 14(1](a) and V lO[a}fian.d specific performance being granted when Ios::.c"an be ascertained.
L/,.
Ix.) l\) [xx1'ii) The order of the Trial Court is perverse, capricious and iliegal and therefore, cannot be susts.i_i1ed._in law.
10. The learned counsel for...th_e contended as follows:
a) That the property is of they suit and no interest is cr6,9.-"r°€~ffi1 i"y.~th€/i"v'1..3l'o}?'~6-
(1)) The agent can .%;nd the remedy is by way of Contract Act.
(C) The the respondent No.7 is in possession amount of ?.1,56.00,000/--
and the respondent VNo.a'17'._isVie::iu..'cb4ona fide third party. 0 it - {d};i'h»e:re's.ponden'fNo.7 has received goods and they are delivered' Road and the respondent No.7 is doing "business.
00 {em of ?.50.00,000/-- has been paid much prior to hsiiitwdon 10-12-2009 and the respondent No.7 has been . A put in possession. L
(f) Huge amount has been paid and keeping the premises vacant will not help anybody. {g} The respondent No.7' has imported invested huge amount and therefore, inju11'ctio11,dCarn.not be granted .
[h] When there is no rights_..in:'"th'e..__property, Vginjunction cannot be granted.
{1} The :3~cor:1venien_ce"'lies in favour of the respondent No:'Z, 7. V U} "by the respondent No.7 show that the responddcnt' imported goods and decorative :'material' and the invoices are in the name of the mother corrrpany,dl s1;rbvsid.ii~ary companies and respondent No.7' and ltherefore. the-respondent No.7' cannot be prevented from business and injunction may be vacated. ill. The learned counsel for the first respondent it ~. _ccntended as follows;
1/ 2.4 (1) The appeilant is the father of the respondent No.3, father--in--Iaw of the respondent No.4 and the grand father of the respondents 5 and 6.
(ii) The respondent No.2 is the firm and and the respondents 3 to 6 are the partners. 22
(iii) The agreement dated 2--3--2'OO§5:_'has the appellant and the respondentspjtfiand.4.__ '
(iv) O.S.No.804/2Q;-IQ haps-"bVeen"'fi1ed by"theV§appe11ant for ejection on 25-1-20 Called on 1E">-2--2O1O:';.._A The to 4 have appeared before the Court voluntarily The case has been Vadj'ourne:dVt_o 22~2¥201_Q_and from 22-2-2010, the case has been 30--8--2010. From 30w3w2010, the Case has s._w_been'preponedV'tjtop'2?t-2w201O and the matter has been referred Adaiat and before the Lok Adaiat the matter has been and the respondents 2 to 4 have agreed to vacate the to _prerrr1gses by 5-32010.
L/t 25 (V) The affidavit tiled by the respondent No.7 shows that possession was delivered on l0--12--2009 but, Thirumaiaraj could not have delivered possessilo'rt_l'~._on 10~12--2009.
(vi) The letter dated 26»-2-2O1OV goods"
were in the premises till 24--2--2010. 1 [vii] The respondent NO.?lV'I1.aS liedxto A{Co_11Hrtl3 therefore, not entitled for any equVitl3'V/V'}-
(viii) Except 10» 'no dated is mentioned when possessioii the respondent No.7.
(ix) Theauobeetvetien.idler the Trial Court that there is nothing.» show thdatpossession was taken is correct.
i _Hug'e.arnot__1_nt has been paid without even a scrap of it ..li1.t.he written statement filed by the appellant on there is only mention of ?.50,00,00()/-- and there 1%"
26
is no mention of ?.70.00,000/~ or delivery of possession on 10-12-2009.
(xii) The payment of ?.70,00,000/- and ?.36,QO-,.QGQ/« is pendente lite and bona fides cannot be pleaded l ~. -I~
(xiii) That on 26--2~20l(). notice; has be_en"iss_ue'd tiopthfie"
Best Sellers and it has not been replied. ~ ll
(xiv) The documents produced are not authenticated doe1,imentsp._....l:' ' (Xv) by the respondent No.4 shows thatlthue premises till 31-3-2010. ()§vii:]. suit the appellant is collusive and it is to of the agreement to the first respondent. counsel who has appeared for the lflppnrespondentvlll in the trial Court, has appeared for the 5 = ant in the appeal.
1/ (x.viii} The agreement dated 02.03.2005 is not terminated and no notice of termination has been issu.ed,d"._V {xix} The LA. filed on 3l~3--2010 indicategs interiors were in the premises till 31~.3'd-20i'0. .y l [XX] There is no material o101__re(;ord0to sh.ovr._the'exis--tence. V "
of lease between the appellant and.,.th'e_respondent (xxi) It is inconceivabplfi.ihatp'fifbrés.l{.of.'V_'if1§.pees have been paid without ar1Y ' [Xxii}:fI'he has been antedated to create eviderioe'; _ r bVLu1Si1'1..¢_S.S' has been carried on even during Ilebrualiy behalf of the first respondent.
[)Q:iv}rT;he plea of equity cannot be entertained. V{XX\:f} The dispute is in relation to the premises and the to the first respondent is in relation to the premises. L//.
28 (xxvi) Injunction can be granted to enforce the negative covenant and section 42 of the Specific Relief Act is an exception to section -/~i1(1)(e) and injunction can be granted, (Xxvii} There is no clause in the agreement can terminate the agreement.
{xxviii} The first respondent to the appellant and the respondents 2 to» . _ if {xxixl There is no g__revocati:onV__or_p renounciniig of the agreement dated 02.03.2005fandphtleiereioretlfsection 204 of the Contract Act is 'not'ua't'tractede,gA*2. T (xxx) he first is ready to perform its ololigatiorfa'. " F. 89 of CPC has been abused.
sitiiation is created by the respondent No.7 defeat thehfrights of the first respondent under the ffa;§}ree*me.r;t dated 2~3«»2oo5.
L//.
[xxxiii) Piacing reliance on the decision of the Hon'bie Supreme Court reported in 1990 (Suppiement) SCC he submitted that the Appeilate Court would interfere with the discretion of the .T4riaT.f"A.Vth'e,"
discretion has been exercised reaso'i1pab.'iy"'anci.in..'&1pju'd\iciai 1'i'lE11'1I'l€T. [xxxiv] Piacing reliance decision "reported in (2005) 6 sec page :49, he...sub1nitted'°t'hatV..'the fraud vitiates every soiemn act Vaniounts to fraud.
decision reported in ILR 1994 Karnatapkapp page submitted that the retiring partner does cease' to be iiabie and the iiability is ivdisdchargedd 't}1em"ag'reen1e11t exists between the third partjr, and the partners of the reconstituted iirm.
nurther piacing reiiance on the decision reported 19935395 SCC page 545, he submitted that when a contract co1'rrp1'ises an affirmative agreement to do certain act, coupied Li.
30 with negative agreement not to do certain act, the Court can grant injunction to enforce the negative covenant. {xxXvii) Placing reliance on the decision re§:--o:rtledV.' 1987' Karnataka page 57. he submitted. that rheer¢5::£ra¢tivVw-as not based on personal volition and thlereforej can be enforoeidi. [x:<xviii) Placing reliance onivgéthe decision Hon'ble-it Supreme Court reported, pva..g.ev:§ 796, he submitted that the payinentsh'liavei'beenvtrngade subsequent to the suit and therefore;-.cari'not oflany c'oi'i«sequenoe. on the decision reported in AIR 1994 submitted that a person whose grease is»*'l9ased on "falsehood, has no right to approach the Co_u'r.tlan.d be thrown out summarily. Furtlhierillplacing reliance on the decision reported in {6} page 285, he submitted that section 32(2) prrov.Aide_sjlA.l."that liability of retiring partner can be discharged there is an agreement between the retiring partner, 1?//_ 31 third party and the partner of the reconstituted firm and in the absence of that, the Eiability of the retiring partner is not discharged.
(Edi) Piacing reliance on the decision reported 2000 so page 3272, he submitted that the iieeteeipeeseei the previous proceedings is co11usive"Car1_ be raisedgin proceedings.
(xiii) Placing relianceuon rt1a"'iii98t5_ SCfi'pagg_.i?1156, he submitted that the expressions out of, in respect igniirflelvation to, in consequence of, concerniiigfi, " widest ampiitude. (x1iii}. Hediiéthereforedslihmitted that the impugned order "ig2u.' it cttrefully considered the submissions made the 1e_arfl.ed1c't3nnsei for the parties. AA 13. ii The point that arises for consideration is, A 'H./'he2tf1er the impugned order calls for interference?
14. It is relevant to note, the suit is for specific performance of the agreement dated 2-3w20'(15:e»».4:":'a,nd alternatively, for damages. The first respondent _ appellant and the respondents 2 to 6 haxfe ag1'eedi:tog 'carry = the business of the first respondent, a:g'ent, in the bearing N0.191, Brigade Road,_v"BangaloVre:56fl tori period of 12 years and not to shgiftvthe'place'oflousiness and the appellant and the respo'n:de.ntsv that the premises belongs to .__the:""firrnl; would retain possession of agreement period, but, the 2 to 6 are trying to create thirdpartiz the first respondent has filedisuit for specifielperlformance of the agreement dated "2_--3-"2.QOE~ and alternatively, for damages. 'l'h.efj_'V..appe1lant contends, the suit schedule .,l_l,i'_:«...pro_perty belongs to him and he is the owner of the suit property and he has retired from the firm and he . filed suit for ejection against the firm and its partners .and it has been decreed and in terms of the decree, the 33 appellant has taken possession and leased out the premises to M/s.Best Sellers i.e.. the respondent No.7 and respondent cannot question the act of the appellant of the suit schedule property.
16. The appellant and therespondents»"l2'VVAto agreed to carry on the business.:o'f.l_th.e\ first ._li'espondent, as agent, in the premises Brigade Road.
Bangalore --~ 1 for a,V.period"-of. ill to shift the place of business:, a:greed"":that the premises belongs to the firm and the firm would retain ' expiry of the agreement period. The la«p_ppellan_tl'andifthe respondents 3 and 4 have signed ,_*tl3.ei__agreen1'ent.. ..... .271' he respondents 5 and 6 are the mi-nlors'; _ 2 172 .".i'he:'appellant has filed suit in 0.S.No.804/2010 eje(;tiori"¢on 25--~01~2010 and it has been called on The respondents 2 to 4 have appeared ttoliintarily and the case has been adjourned to 22.02.2010. L/0 34 On 22.02.2010, the case has been adjourned to 30.03.2010 and from 30.03.2010, the case has been preponed to 24.02.2010 and the matter has been referred to Adalat. Before the Lok Adalat the matter has been respondents 2 to 4 have agreed to Vacate 05.03.2010 and the compromise Thereafter, the stock of the.»il1"-i._1_jst lrcspondent}:
relocated and the first respondentihas beenliniolvrlmelei through the letter dated 26.02.2010 _At'ha'§t}_g' vvtheljvvvpregmises has been vacated and possession has'-bieen' the appellant and the ontllthe premises to M/s.Best Sellers i.e.,l7the- herein. The appellant and the respondents" haveagreed that the premises belongs the 1-.but';..theyh'ai.?e obtained decree representing that thetlenant which is contrary to the terms of the n""V'agreeme.1__1t. ' A A18. " The Hon'ble Supreme Court in the case of STATE PRADESH AND ANOTHER vs T.SURYA RAO reported in (2005)6 SCC page 149, has 35 held, fraud Vitiates every solemn act and misrepresentation amounts to fraud. A collusion or conspiracy with a View to deprive the right of others in relation to a property_:"w_d_ould render the transaction void.
19. In GRAM PANCHAYAT, it UJAGAR SINGH reported in AIR zcjooiéiise Hon'ble Supreme Court has held_,' thehplea passed in the earlier proceedings collusive 'clangbe raised in the later proceedings. V
20. presentr.l.:l.'caseiuWthe appellant and the respondents' to' ,6':.lhaV*e:"represented that the property belongs firm" have obtained decree representing that the the which is contrary to the terms of liiiriina facie, the decree has been obtained to Awldefeat the of the first respondent under the agreement 2:3.2'0t)5 and to create third party interest. Therefore, V it-cannot: be said, the suit is not maintainable and a case for 36
21. The iearned counsel for the appellant contended that the first respondent has no right to eniore'e.Vp:"the agreement as there is no privity of contract-:ftietv.?eeen'i appeflant and the first respondent ar;.~d"ti1ere is on 9 record to show that the first respondent theirldian and Industries Limited are one 'arrdpthe There is no merit in this contention, 'for thetappellant is a party to the agreement and has i'siEgiied:_:itheegreement dated 2.3.2005 .and tiicfiVpi1'doc1gm{eetsr«..A';jriod1;;§V;:d by the first respondent shofiv Industries Limited has changehdeuits" iéiirlya Nuvo Ltd. Therefore, there is no nr;1er'itViri eonte'r1tion that there is no privity of contract between and the first respondent and iaee'ordirr;,g{1y;-."iet i"s..rejectedr counsel for the appellant contended the eras not the owner of the premises and the 5_"-appe}lVari't._is the owner of the premises. There is no merit in eontention. In the agreement dated 26-2005, it is .agreed that the firm was the owner of the premises and the 1/ 37 appellant has signed the agreement and has carried business for years. Therefore, it cannot be contended that the not the owner of the premises.
23. The learned counsel for the' lappellantjzvcontended that the first respondent cannotgeornpelp the agentfio property in a particular way. This not compelling the agent to usethe a particular way.
The agent i.e., the appellant 2 to 6 have agreed to carry "i;ot"a:pe1°i9.diéof 12 years and to retain possession~;not.:'p1ace of business and it is their obligation a'nc1»iygtl1e'lfirst. respondent is/\cornpelling the agent to use the.Vpr.operty_inaparticular way. . learnedmcousnel for the appellant contended that" the agency and the remedy is by yvay of"'"dan_jiage'si In the present case, the agent has not the agency. The letter dated 262-2010 indicates that"'._VVth'e second respondent has requested the first T fesponderit to secure alternative show room, if the first 1_/ 38 respondent requires the firm to continue the business. Therefore, it cannot be said, the agent has rounce.ci"r.the agency. The stand is changed subsequently thought.
25. The learned counsel _for appellant"contended, that the contract is of agency a11'd=.:sa1e of rnovab-11ev"p:ropertiesVV and specific perfornlancei virtue of section 14.«(a], {b} and (d} of Act and there can be no specific" "of"ag:encyr..agreement as it is a contract for personal Reliance was placed on MAU/WB/1140/..1976 sc page 888.
26.:.~--.Ir1 it has been held, the 2,/to seil moyiable property through an agent can ney'-er enforced. In AIR 1976 SC page 888, M has been a contract for personal service cannot be i,",e1aforcet1. 'In. MANU/MH/0345/ 2002, it has been held. there it -no specific performance suit to enforce the agency
-agreernent as it is a contract for personal service. 1'/,.
39 27'. Section 14(a), (b) and (d) of the Specific Relief Act provides that contract. for which compensation in n1'o.n'ey~'--is the adequate relief, the contract which runs into.--'4'r%1inu'te's----i ~ numerous details and the contract.' xyhichfyé involves 2' performance of continuous duty _ supervise cannot be enforced spec--1_fically;." .
28. In the present the;V--corit1'act.yis to carry on the business as agent for a periodihof 1'2years suit schedule premises. The the respondents 2 to 6 have agreed to carry on period of 12 years and to retain possession and-~not"t2o""re'iocate the business but they have deviated;~.._VhThereiore,~.:_'the first respondent intends to :_.e"nforce_';t'heE _2obligatiAo11.o_f_ the appellant and the respondents 2 to the business for a period of 12 years and to 2 V'-,-retainr V 'possessjioh and not to relocate the business.
-. Therefore;~ it 'cannot be said, the suit is not maintainable, and 4: it a. :rr1a«tter for trial.
40
29. it is contended that section 4l(l)[e). 38(._'3)__ and lO(a)[b) of the Specific Relief Act bars the suit 38(3) of the Specific Relief Act prohibits injunctiori if be ascertained and section 14{l][a) and" section of the S Specific Reiief Act prohibits vspecificl".lperforinance if granted when loss can be ascertained,.
30. Section 41(1)(e):'of .. provides that injunction cannot be breach of a contract the peri":._')rrlix'j$;':-tlliiipcel-.of be specifically enforced.
31. V3'8{A3)_'of Specific Relief Act provides when Court 3239 2 Section "1.flfa) and (b) of Specific Relief Act provides specific» _perfor1nance can be enforced when there exists no ' stand-ard'ofVascertaining damages for non--perforrnance of the agreed act or nvvhen the act agreed to be done is such that confipfehsation for money for its non»~perforInance would not S" _p'roviLie adequate relief.
L/e
33. Section 42 of the Specific Relief Act provides. When. a contract comprises an affirmative agreerrient;.__to. do certain acts, coupled with a negative agreernent,f""notj_~ certain acts, if the Court is unablempto co_n'1pel:~.a'~sp«ecific~.. performance. it can grant injunction '-._to perform' the riegatifge agreement.
34. in the present respondent"intends to enforce the agreement dated provides that the appellant and" Vv6_..sh0u1d act as agent of the first linisiness for a period of 12 years ir1_th~e' suit'sehedtilepremises and retain possession and the location changed. The appellant and vvthe res_p€1Ild_ents 't--e_€>____h21ve agreed to carry on the business in__th.e'"suit__vsch.edule premises for a period of 12 years and :'l"i..Ap_V_retairi. and not to shift the place of business but, l=..._tl'1e.y have de.viated. Therefore. the first respondent intends to :enf_"orVce'*--..the agreement which contains both positive and jlegaiiive covenants. Therefore. it cannot be said, the suit is maintainable and it is a matter for trial. L, 42
35. It is contended, when the maintainabi1ity_.o_f the suit is doubtful, injunction cannot be granted. placed on AIR 2001 Karnataka page 212. Karnataka page 212, it has been:'hAeld,.\fl2vhen." 9 prima facie case, injunction cVannoVt:__b'"e, grant_ed.». = ln"--~the,V present case. there is prima facilevacase. 'Fhei"ef"ore;1.pit"cannotV be said, the injunction cannot
36. It is contended, 2 of CPC is not applicable. I dofnfot contention, for the reason, provides that in a suit restraining', the committing breach of contract or othe_rhin}'1njVVof kind, whether compensation is claimedor not. the C--ou__1ft, can grant injunction. Rule Me} of CPC provides, if the 'Ln,,.,__defendanrt' to disposes the plaintiff or otherwise ;x._,__cauVse injtirlyi the plaintiff in relation to a property in in the suit, the Court can grant injunction. Therefore, i" clear, the Court can grant injunction to prevent breach of L/ 43 contract or injury to the plaintiff. The Court can also grant injunction when there is threat of injury to the in relation to a property in the suit. In the present respondent alleges breach of contract__a.nd__ 'injury' '_1_felati'o.n to "
the property and therefore, injunction ibedgrandt-ad ..u--njEi1-er Order 39 Rule 1(c) and Rule 2 lierefore. no'-it merit in the contention that injunc--ti.o'n ca_nnotd'be.Ag1ja§r1ted and accordingly, it is rejected.
38. Further cwontendec-'1,l._the1'e"'is no prima facie case, balance ofV..co~n'i;reniu€r1ced'tor. irrdepdarable injury to the first respondent}, I*do wnvot'fflnd».,aiiyhrierit in this contention, for the reason, the app-eldiant' and respondents 2 to 6 have agreed Vto.carr1;"5un: business «asagent in the suit schedule premises for, period years and to retain possession and not to .'u"s.____._shift business but, they have deviated. The ..d_2ji'_f.j.app_e1lant filed suit for ejection contending that he is the owner' suit schedule property and the firm is the tenant . is contrary to the terms of the agreement. The V'R'»»a4}.3°pel1ant. and the respondents 2 to 6 have obtained decree it/i-
44 contrary to the terms of the agreement. The stock of the first respondent has been relocated to some other place. The first respondent has filed suit for specific performance"-offlthe agreement da.ted 02.03.2005. If the premises isjlet; first respondent will be put to hardshipwandptijie elaiimed will be frustrated. Therefore, it is prop_¢f--.to grant inj T he Trial Court has rightly granted the' appellant a.nd the respondents 2:to' ._a1iena'tiHg, leasing, sub-leasing or encumberinglthel0prope.rty"the disposal of the suit.
39. lvliiioiveverl; '0 counsel for the appellant submitted thaitgthe oo.nifenie_nce of both the pa.rties must be :_1ool:ed,_iriItoE_iévhile gran.ti_ng injunction. I find force in it. If injiirietion the appellant and the respondents 3 to Cannot' premises till the disposal of the suit. .l_0pi'_:«.f!§fh'e_rel'ore,it is proper to direct the first respondent to give an that it will compensate the ioss to the appellant H the respondents 2 to 6 for not using the property, in case first respondent fails in the suit .
L/.0
40. The respondent No.7 claims that it hasitlalgpien possession on 10.12.2009. There is no documenft;"e\}id~enei.;n_g« _ lease or taking possession on lO.12.2QQ9. T has». stated that he is custody of the propert3f'9tnd"rahas property in favour of M/s.Bes'i':_Sellers'-,iie.,V tliie t.rrespV§)1,cident:":r. No.7. The appellant has filed for ejection. It has been It fs agreed that possession has top" be The respondent No.54' contending that the firm ebruary 2010 and the articles of relocated after the decree. The firm has Vltil.ehdv.applicatio:r1 for removal of the interiors on OE.__lAfI'h,Verefore,..it. cannot be said, the respondent No.7 has on 10.12.2009. The respondent No.7 'l"»..,.».has pi*o'diiced'V'Vlsjori1e documents. The certificates show that has been credited to the account of the but, the certificates do not show that possession . taken on 10.12.2009. The documents produced by the V"v.j_:"'respondent No.7, except few, relate to M/s.Best United Life L"
46
Style i7'vt. Ltd., and the premises is shown as No.1.91_/193. The documents produced by the respondent No.7 do not that possession was taken on 10.12.2009.
41. This Court has granted irgjungtignll'ofi._1's.o.7»,..Qo...iti restraining the respondent N0.7iro.rn canfyling cr.n"'bfu.s_ine_ss in the suit schedule premises 'l':'he order passed by the Trial Court The appellant and the respondent4s:3_to from leasing, sub-leasing, suit schedule property. Ther5fi0rfé'* cannot be permitted to do the schedule property and the request of the is rejected.
l has rightly granted injunction and thercfore,,lAit~do,es hct call for interference. There is no merit in this appeal and «therefore, it is liable to be dismissed. Accordingly, the appeal is dismissed. However, . first respondent is directed to give an undertaking to the 'Trail Court, that in case the first respondent fails in the suit, 47 it will compensate t.he loss to appellant and the respondent 2 to 6 for nobusing property i.e.. the suit schedule Having regard to the Circumstances of the cage", Court is directed to dispose of the mat--t'eI-as e7_ar1§_fao '4pose_gib1'e., on merits, without being influenced observations"
in the course of this order.
The application byte Mis.Cv1.No. 12036 / 20 1 0 for vacating interith o1'd'e_r rejected.
a i Judge _