Bombay High Court
Addon Realty Pvt Ltd vs Shivalik Ventures Pvt Ltd And 6 Ors on 25 January, 2023
Author: R.I. Chagla
Bench: R.I. Chagla
10-IA (L) 31785.2022 in CHSCD 955.2019 with IA 4465.2022 in COMEX 48.2021.doc
K.S. Jadhav
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
INTERIM APPLICATION (L) NO.31785 OF 2022
IN
CHAMBER SUMMONS NO.955 OF 2019
WITH
INTERIM APPLICATION NO.4465 OF 2022
IN
COMMERCIAL EXECUTION APPLICATION NO.48 OF 2021
Shivalik Ventures Private Limited ...Applicant/Original
Respondent No.1
In the matter between
Addon Realty Private Limited ...Original Applicant
Versus
Shivalik Ventures Private Limited & Ors., ...Respondents
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Mr. Armin Wandrewala a/w Mr. Yadmath Chaudhari a/w Mr.
Jasbinder Chaudhary i/b Mr. Hassan Khan, Advocate for
Applicant/Original Respondent No.1.
Mr. Abhinav Chandrachud, Counsel a/w Mr. Samarth J. i/b Sanjay
Udheshi & Co., Advocate for Original Applicant.
Mr. Cyrus Ardedshir a/w Mr. Chinmaya Acharya a/w Mr. Ashwin
Sawlani a/w Mr. Viraj Jadhav i/b Jaswandi Khatu, Advocates for
Respondent Nos.2 to 5.
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CORAM : R.I. CHAGLA J.
DATE : 25TH JANUARY, 2023.
ORDER :
1. By this Interim Application, the Applicant/Respondent No.1 1/12 ::: Uploaded on - 31/01/2023 ::: Downloaded on - 31/05/2023 13:16:34 ::: 10-IA (L) 31785.2022 in CHSCD 955.2019 with IA 4465.2022 in COMEX 48.2021.doc has sought permission to sell the Flats/Shops in the subject project on the condition that the part of the proceeds of the Flats/Shops shall be deposited in this Court and balance proceeds thereof to be deposited in the RERA Bank Account.
2. The present Interim Application has accordingly sought a variation / modification of the order dated 8 th January, 2020 passed in Chamber Summons No.955 of 2019 on account of what is stated as changed circumstances. In the Application at Paragraph 4 onwards, certain facts and circumstances have been set out with regard to the subject project. There is a brief background given prior to the Consent Terms which had been entered into by the Applicant with the Judgment Creditor. There are, in fact, two Consent Terms filed in both the Suits on 2nd May, 2017. Various undertakings have been given by the Applicant in the Consent Terms which were accepted as undertakings to this Court. Under the Consent Terms, a mechanism was provided whereby the Respondent No.1 would release flats from the Security Flats held by it, as payment was made to it by the Applicant. There were defaults on the part of the Applicant in the Consent Terms to pay subsequent installments to the Respondent No.1 and for which the Contempt Petition had been filed. Vide order 2/12 ::: Uploaded on - 31/01/2023 ::: Downloaded on - 31/05/2023 13:16:34 ::: 10-IA (L) 31785.2022 in CHSCD 955.2019 with IA 4465.2022 in COMEX 48.2021.doc dated 17th July, 2018 passed by this Court in Contempt Petition No.55 of 2018 and Commercial Petition (L) No.21 of 2018 a fresh schedule was set out for payment to be made by the Applicant and the two Contempt Petitions were disposed off.
3. The Applicant was once again unable to make payment as per the Schedule. Two more Contempt Petitions being Contempt Petition No.15 of 2019 and 17 of 2019 were filed by Respondent No.1 which also resulted in Consent Terms dated 23rd May, 2019 being taken on record by order dated 3rd June, 2019. The said two Contempt Petitioners were disposed off by the said order. By these Consent Terms, the Applicant had promised to repay the Judgment Creditor within the payment Schedule as per the said Consent Terms dated 23rd May, 2019. The Applicant failed to adhere to the payment schedule.
4. It is necessary to note that in the order dated 8 th January, 2020, this Court had considered the Execution proceedings instituted by the Judgment Creditor and held that the Execution Proceeding was very well maintainable against the Original Respondent Nos. 2 & 3. This Court had also considered that by prior order dated 17 th December, 2019 it was observed that if the Applicant/Original Respondent No.1 3/12 ::: Uploaded on - 31/01/2023 ::: Downloaded on - 31/05/2023 13:16:34 ::: 10-IA (L) 31785.2022 in CHSCD 955.2019 with IA 4465.2022 in COMEX 48.2021.doc intended to sell any Flat in the subject project, it shall give 72 hours prior notice to the Original Applicant. This Court considered that in the facts and circumstances urged before the Court, it will not be desirable to continue the directions, particularly, when the Applicant/ Original Respondent No.1 would be selling flats in a building of which consideration is yet to commence. Accordingly, till the adjourned date of hearing, this Court ordered the Applicant/Original Respondent No.1 shall stay its hands and not to sell flats in the subject project, except for the three purchasers to whom the three flats are intended to be sold as informed by the learned Counsel for the Applicant/Original Respondent No.1, details of which was to be provided during the course of that day.
5. In the present application, it is stated that on 2nd June, 2022 further Commencement Certificate to Wings D,E and F of Gulmohar Avenue Project has been granted. Further, on 2 nd August, 2022, the part Occupation Certificates were issued to Prabhat Darshan (Composite Building No.60) in the S.R. Scheme on the land bearing C.T.S. Nos. 255, 256 & 257 of Village Bandra (E), known as Prabhat Darshan at Golibar, Santacruz (E) in H/East Ward, Mumbai - 400 055 for Pragati Mandal CHS Ltd. and 50 other societies. The 4/12 ::: Uploaded on - 31/01/2023 ::: Downloaded on - 31/05/2023 13:16:34 ::: 10-IA (L) 31785.2022 in CHSCD 955.2019 with IA 4465.2022 in COMEX 48.2021.doc Applicant has commitments under the Slum Rehabilitation Scheme to the Slum Dwellers. The total eligible Slum Dwellers are approximately 6063 out of which 3988 Slum Dwellers have been vacated by the Applicant till date and 2101 Slum Dwellers have already been provided permanent alternative accommodation. Thus, 1887 Slum Dwellers who are already vacated and 2075 Slum Dwellers who are yet to be vacated making a total of 3962 are required to be provided permanent alternative accommodation urgently.
6. The Applicant has further stated that till date, the Applicant has paid to Respondent No.1/Judgment Creditor a sum of Rs.122.65 crores, leaving a principal balance of Rs.64.85 crores. The Applicant is also required to pay BMC lease rent, outstanding rents payable to Slum Dwellers, Property Tax & Land Under Construction Tax.
7. The particulars of the project with regard to the Slum Rehabilitation Scheme have been highlighted in Paragraph 28 of the Interim Application. The various flats which are to be sold in the Free Sale Project and expected revenue have also been highlighted. There are total 1168 tenements in the free sale in the two sale projects. The expected revenue from the sale of the Flats in the two 5/12 ::: Uploaded on - 31/01/2023 ::: Downloaded on - 31/05/2023 13:16:34 ::: 10-IA (L) 31785.2022 in CHSCD 955.2019 with IA 4465.2022 in COMEX 48.2021.doc free sale projects is about Rs.930 crores. It is further stated that the present scheme is registered under RERA and as such 70% of the sale revenue is required to be deposited in the RERA account. There is further statement made in Paragraph 28 (i) that the Applicant can repay the entire balance amount in next 36 months if the Applicant is permitted to sell the Flats by protecting the rights of the Respondent No.1. Thus, the present application proceeds on the premise that in the event the Applicant is permitted to construct the flats of Plot Nos. S-6 and S-7, the same can be released for sale on the condition that 20% of the revenue from these flats will be deposited in this Court and allowed to be withdrawn by the Original Applicant/Judgment Creditor. The Application also proceeds on the premise that in the event there is a sale of the flats on Plot Nos. S-6 and S-7, it would generate the revenue to implement the scheme of Slum Rehabilitation or otherwise several Slum Dwellers, whose houses have been demolished will suffer, if the scheme is not permitted to be proceeded with. The Applicant has thus stated that unless the sale is permitted, the Applicant cannot generate the revenue for construction.
8. The present Interim Application was heard on the previous 6/12 ::: Uploaded on - 31/01/2023 ::: Downloaded on - 31/05/2023 13:16:34 ::: 10-IA (L) 31785.2022 in CHSCD 955.2019 with IA 4465.2022 in COMEX 48.2021.doc date. This Court had indicated that the parties shall attempt to work out a suitable arrangement considering that the Slum Rehabilitation Scheme was required to be proceeded with in view of what has been stated in the present Application with regard to the Slum Dwellers, in view of their houses having been demolished, were suffering with the Scheme not being permitted to be proceeded with.
9. An Affidavit dated 24th January, 2023 has been filed by Applicant. It is relevant to note what has been stated in Paragraph 2 of the said Affidavit. The Applicant has stated that there are 367 unsold flats available for sale in the proposed building viz. Bandra, Gulmohar Avenue on Plot S-6. The market value of each unsold flat is approximately Rs.70 Lakhs. There is potential to construct 496 number of Flats in Plot No.S-7. All these Flats are unsold. The expected value of each Flat is approximately Rs.80 Lakhs. The SRA has sanctioned the plans and further instructions are expected to be granted in a short period of time. In Paragraph 3 of the said Affidavit, reference shall be made to the said order dated 8th January, 2020 by which this Court had prohibited the Applicant from selling the Composite Flats other than the three Flats mentioned therein. The Applicant has in Paragraph 4 of the said Affidavit sought 7/12 ::: Uploaded on - 31/01/2023 ::: Downloaded on - 31/05/2023 13:16:34 ::: 10-IA (L) 31785.2022 in CHSCD 955.2019 with IA 4465.2022 in COMEX 48.2021.doc permission of this Court to sell the unsold Flats against advance payments of Rs.35 Lakhs on each sale of Flat to the Decree Holder till the entire claim of the Decree Holder is satisfied. It is now orally stated that advance payment of 50% of the price at which the Flats are ultimately sold will be paid to the Original Applicant. The Applicant has stated in Paragraph 5 of the said Affidavit that it is ready to pay an amount of Rs.1.05 Crores to the Original Applicant/Decree Holder via Pay Order bearing No.019458 dated 16th January, 2023 drawn on Axis Bank Limited. This is towards the sale of three Flats in the said Scheme/Project for which permission is sought.
10. There have been various submissions made by Dr. Abhinav Chandrachud, as to why equitable relief should not be granted to the Applicant who has violated the Consent Terms in which undertakings were given to this Court to adhere to the payment schedules. There have been repeated breaches of orders passed by this Court by the Applicant and its Directors who are habitual and repeated contemnors. He has submitted that though warrant of attachment was issued by the Prothonotary and Senior Master of this Court against the Applicant on 22nd April, 2022, the Applicant has failed to 8/12 ::: Uploaded on - 31/01/2023 ::: Downloaded on - 31/05/2023 13:16:34 ::: 10-IA (L) 31785.2022 in CHSCD 955.2019 with IA 4465.2022 in COMEX 48.2021.doc co-operate with Bailiff & attachment has not been executed. Thus, the Applicant is obstructing the execution of the decree. Considering these submission weighed against the present Application, which seeks to address the plight of the Slum Dwellers who will continue to be dis-housed, if the project remains at a standstill, the present Application requires to be given due consideration.
11. Dr. Abhinav Chandrachud has further submitted that the proposal now made on behalf of the Applicant is contrary to the Applicant's own Interim Application. However, in my view, the oral offer/proposal made of advance payment to the Original Applicant of 50% of the price of the Flats sold is better than the offer made in the Interim Application. In that view of the matter, the Judgment Creditor will not in any way be prejudiced if the relief is granted to the Applicant in such modified terms and "safeguards" provided. Thus, there requires to be a modification of the prior order dated 8 th January, 2020 in so far as permission to sell the Flats in Plot Nos. S-6 and S-7 are concerned. This being conditional upon the advance payment of 50% of the sale price at which the Flats are agreed to be sold being paid to the Judgment Creditor and in the event of any default in such payment, the sale of the subject Flat will not go 9/12 ::: Uploaded on - 31/01/2023 ::: Downloaded on - 31/05/2023 13:16:34 ::: 10-IA (L) 31785.2022 in CHSCD 955.2019 with IA 4465.2022 in COMEX 48.2021.doc forward. Thus, I can see no manner in which the Original Applicant/ Decree Holder at all can have any grievance with regard to the modification of the said order in these Terms.
12. The Judgment Creditor undoubtedly shall proceed with the execution of the decree for which the aforementioned submissions of Dr. Abhinav Chandrachud require consideration and further directions are issued by this Court herein below. Hence, the following order is passed :
i) The Applicant is permitted to sell the unsold Flats in Plot S-6 & S-7 subject to the advance payment to the Original Applicant/Decree Holder of 50% of the sale price at which these Flats are agreed to be sold as per the Agreements for Sale entered into with the purchasers and for which details will be furnished within five working days from the execution and registration of the Agreements.
ii) In the event, the advance payment of 50% of the sale price of the Flats in S-6 & S-7 are not made to the Original Applicant/Decree Holder, the sale of the subject Flats shall not go through.
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10-IA (L) 31785.2022 in CHSCD 955.2019 with IA 4465.2022 in COMEX 48.2021.doc
iii) The balance 50% of the sale price shall be deposited by the Applicant in the RERA Bank Account.
iv) This order is further subject to the Applicant and its Directors i.e. Respondent Nos. 2 and 3 filing further Affidavits of Disclosure disclosing their upto-date assets, both movable and immovable as well as value thereof. Further, full particulars of the loans and advances which have been referred to in Item 5 annexed to the Affidavit of Disclosure filed on behalf of the Applicant shall be disclosed. This shall include when the loans and advances of the Applicant are repayable as well as the Agreements which have been entered into for that purpose.
v) It is clarified that further Affidavit of Disclosure made by Respondent Nos. 2 and 3 through Directors of the Applicant shall be enclosed in a sealed cover and filed in this Court.
vi) The issue as to whether the Respondent Nos. 2 and 3 as Directors of the Applicant are liable for satisfaction of the decree, shall be considered on the next date.
vii) The Affidavit of Disclosure will be filed by the Applicant as well as by Respondent Nos. 2 and 3 within a period of three 11/12 ::: Uploaded on - 31/01/2023 ::: Downloaded on - 31/05/2023 13:16:34 ::: 10-IA (L) 31785.2022 in CHSCD 955.2019 with IA 4465.2022 in COMEX 48.2021.doc weeks from the date of this order.
viii) The Interim Application is accordingly disposed of.
ix) It is clarified that once the Affidavits of Disclosure are filed by the Applicant and Respondent Nos. 1 to 3, they shall hand over the Pay Orders which is mentioned in the Affidavit dated 24th January, 2023 being in the sum of Rs.1.05 Crores to the Original Applicant/Decree Holder via Pay Order bearing No.019458 dated 16th January, 2023 drawn on Axis Bank Limited and upon the payment being made, three Flats in the subject project shall be permitted to be sold.
x) The order dated 8th January, 2020 passed by this Court is modified only to the above extent.
xi) The rest of the matters shall be placed on 15 th February, 2023, High on Board.
xii) Liberty is granted to the parties to apply for an earlier date.
[R.I. CHAGLA J.] 12/12 ::: Uploaded on - 31/01/2023 ::: Downloaded on - 31/05/2023 13:16:34 :::