Bombay High Court
Ambaji Developers And 4 Ors vs Mukundrai D. Sanghavi And Anr on 19 June, 2019
Author: B.P. Colabawalla
Bench: B. P. Colabawalla
Ladda RS
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
Digitally
signed by
Radhakishan
Radhakishan S. Ladda
S. Ladda Date:
2019.06.24
15:01:52
+0530
NOTICE OF MOTION No.1397 of 2018
IN
SUIT No. 1648 of 2012
Mukundrai Dipchand Sanghavi ] .. Applicant
of Mumbai Indian inhabitant ] (Original Defendant No.1)
In the matter between :-
Ambaji Developers, a Partnership ]
Firm and (4) Ors ] .. Plaintiffs.
Vs
Mukundrai Dipchand Sanghavi ]
and (1) Anr ] .. Defendants.
______
Mr. Vijendra Kumar Rai, Advocate for the Plaintiffs.
Mr. Anush Sequeira I/by Pravin Mehta & Mithi & Co. for defendant
No.1/Applicant to the Notice of Motion.
Mr. Vasim A. Shaikh for Defendant No.2.
_____
CORAM : B. P. COLABAWALLA, J.
DATED :- 19th June, 2019.
1/23
8-nms-1397-18-s-1648-12.docx
ORAL JUDGMENT :
1. This Notice of Motion has been filed seeking a dismissal of the suit under Order VII Rule 11 of the Code of Civil Procedure, 1908. The ground, on which dismissal of the suit is sought, is that it discloses no cause of action. The other prayer that is sought in this Notice of Motion is that this Court be pleased to direct the plaintiff to execute and register a Deed of Cancellation of the lis pendens within such time and period, as this Hon'ble Court may deem fit and proper.
2. As far as prayer (b) is concerned, the learned Advocate appearing on behalf of defendant No.1 submitted that the actual relief that he seeks is that defendant No.1 be entitled to deal with the suit property as it may deem fit without the same being subjected to the operation of lis pendens under Section 52 of the Transfer of Property Act, 1882 subject to whatever terms this Court may deem fit to impose in its discretion.
3. As far as the prayer for rejection of the plaint is concerned, I am unable to agree with the learned Advocate appearing on behalf of defendant No.1 that no cause of action has 2/23 8-nms-1397-18-s-1648-12.docx been set out in the plaint which would enable me to reject it. The relief sought in the suit is for specific performance of the Agreement/Minutes of the Meeting dated 8th February, 2011 entered into between the plaintiffs and defendant No.1 for assignment/ transfer of the plot of land situated at 28A, K.A. Subramanium Road, Matunga, Mumbai-400 019 and admeasuring about 650 square yards, with the building of ground plus two upper floors along with part third floor formerly known as "Ashwin House" and now known as "Sumati" (for short "the suit property"). In Paragraph 17 of the plaint, it is averred by the plaintiffs that under the Agreement/Minutes of Meeting dated 8th February, 2011, all the vital terms of the concluded contract in respect of the re- development of the suit property were agreed upon between the parties and their respective Advocates and Solicitors. It was also agreed that pursuant to the discussion held in the meeting dated 8th February, 2011, the terms agreed therein would be forwarded by the plaintiff's Advocate to defendant no.1's Advocate for necessary action. It is therefore pleaded that only a formality of preparing a formal agreement incorporating all the vital terms and conditions of a contract which were agreed upon and recorded in the Minutes of Meeting/Agreement dated 8th February, 2011 remained to be done. 3/23 8-nms-1397-18-s-1648-12.docx Accordingly, the Minutes of Meeting dated 8th February, 2011 were sent by an e-mail by plaintiff No.1's Advocate to defendant No.1's Advocate. In substance, it is the case of the plaintiffs that there was an oral agreement for development of the suit property that was entered into between the plaintiffs and defendant No.1. Looking at the averments in the plaint as a whole, I do not think that I would be entitled or correct in rejecting the plaint under Order VII Rule 11 at this stage. The plaintiffs must be given an opportunity, however weak their case may be, to lead evidence at trial to prove their case. In these circumstances, as far as prayer clause (a) of the Notice of Motion is concerned, the same is rejected.
4. That now only leaves me to deal with the secondary prayer, namely, whether defendant No.1 should be allowed to deal with the suit property as it may deem fit without the same being subjected to the operation of lis pendens under Section 52 of the Transfer of Property Act, 1882. It is not in dispute that a lis pendens with reference to the above suit property was registered on 17th August, 2012. The learned Advocate appearing on behalf of defendant No.1 submitted that prima facie the plaintiffs have no case for specific performance of the agreement for development of 4/23 8-nms-1397-18-s-1648-12.docx the suit property and in the facts of this case there is no case even for protecting the plaintiffs in respect of any alleged charge in respect thereof. In fact, no such charge has even been prayed for in the suit. The learned Advocate placed reliance on the ad-interim order passed by this Court dated 31st July, 2012, wherein this Court prima facie found that the entire communication placed on record would reveal that the matter was only at the stage of negotiations and no final agreement had been arrived at between the parties. Even the claim of the plaintiffs that it had paid Rs. 40 lakhs in cash was disbelieved by this Court. This Court held that it was difficult to believe that such a huge amount would be paid by cash and that too without any receipt from the defendants.
5. Over and above these observations, the learned Advocate appearing on behalf of defendant No.1 also placed reliance on a public notice dated 26th March, 2012 which was given by the plaintiff, which states that the plaintiff has negotiated to acquire and purchase from defendant No.1 the suit property. This public notice can be found at page 8 to the written statement filed by defendant no.1. The learned Advocate submitted that even according to the plaintiff, and as per this notice it was clear that the transaction in 5/23 8-nms-1397-18-s-1648-12.docx question were under negotiations and at least prima facie there was no concluded contract. Thereafter, reliance is also placed on Exhibit "J" to the plaint which is Minutes of the Meeting dated NIL February, 2011. The learned Advocate appearing for defendant No.1 took me through the Minutes of the Meeting in great detail and contended that on a holistic reading of these Minutes it was quite clear that there was no concluded contract and in fact these Minutes have not even been signed by either of the parties. He submitted that looking to the facts and circumstances of the present case, it was abundantly clear this suit was not bona fide and was instituted only to somehow block defendant No.1 from re-developing the suit property. It is in these circumstances that the learned Advocate submitted that defendant No.1 be allowed to deal with the suit property as it may deem fit without the same being subjected to the operation of lis pendens under Section 52 of the Transfer of Property Act, 1882.
6. In support of this proposition, the learned Advocate relied upon a decision of the learned Single Judge of this Court (Shri S.C. Gupte, J) in the case of Hilton Builders & Textiles Pvt. Ltd. vs. Special Paints Limited & Anr [( 2014) 1 Bom CR 458 : 2013 6/23 8-nms-1397-18-s-1648-12.docx SCC OnLine Bom 1939]. Relying upon this decision, the learned Advocate brought to my attention that the facts of this case, as also the ones before me, were very similar and this Court exercised its discretion in allowing defendant No.1 in that case to deal with the suit property without the same being subjected to the operation of lis pendens. The learned Advocate submitted that looking at the facts and the circumstances of the present case, a similar discretion ought to be exercised by me.
7. On the other hand, the learned Advocate appearing on behalf of the plaintiff submitted that there was no merit in the contentions canvassed by defendant No.1. He submitted that on a holistic reading of the plaint and the correspondence annexed thereto, it was clear that there was a concluded contract between the parties of which a specific performance was sought. Over and above this, the plaintiff had also sought a prayer for damages in the sum of Rs.10 crores. Apart from this, the plaintiff had also made payment of Rs.40 lakhs in cash to defendant No.1 as well as an amount of Rs.11,36,000/- to defendant No.2 who was the Architect appointed for development of the suit property. In these circumstances, the learned Advocate submitted that if the prayer as 7/23 8-nms-1397-18-s-1648-12.docx sought for by defendant No.1 is granted, the entire suit would virtually become infructuous. In these circumstances, it was submitted that the Notice of Motion be dismissed with costs.
8. I have heard the learned Counsel for the parties at length and have perused the papers and proceedings in the suit as well as in the Notice of Motion along with their affidavits. As far as the rejection of the plaint is concerned, I have already held that the plaint cannot be rejected at this stage. This now only leaves me to deal with the second prayer, namely, whether defendant No.1 ought to be allowed to deal with the suit property without the same being subjected to the operation of lis pendens under Section 52 of the Transfer of Property Act, 1882. In this regard, and before I advert to the facts, it would be apposite to set out the provisions of Section 52 as amended in the State of Maharashtra, and which read thus:-
"Transfer of Property pending suit relating thereof....
(1) During the pendency in any Court having authority within the limits of India excluding the State of Jammu and Kashmir or established beyond such limits by the Central Government of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, if a notice of the pendency of such a suit or proceeding is registered under section 18 of the Indian Registration Act, 1908, the property after the notice is so registered cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the right of any other party thereof under the decree or order which may be 8/23 8-nms-1397-18-s-1648-12.docx made therein; except under the authority of the Court and on such terms as it may impose."
(emphasis supplied)
9. What Section 52 (1) (as applicable to the State of Maharashtra) inter alia provides is that during the pendency in any Court of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, if a notice of the pendency of such a suit or proceeding is registered under Section 18 of the Indian Registration Act, 1908, the property after the notice is so registered, cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the right of any other party thereof under the decree or order which may be passed therein, except under the authority of the Court and on such terms as it may impose. On a plain reading of Section 52 it is clear that it confers a discretion on the Court as a result of which the operation of the doctrine of lis pendens can be lifted on such terms and conditions as the Court may think fit to impose. The doctrine of lis pendens does not annul or invalidate a dealing by a party to the suit but renders it subordinate to the rights of the other party to a litigation. The Court has a discretion, which like all other discretion in law, has to be exercised on judicious considerations. Whether a party should be relieved from the 9/23 8-nms-1397-18-s-1648-12.docx operation of lis pendens is a matter of discretion. If the Court choses to exercise that discretion, it is also vested with the power to prescribe the terms and conditions which would sub-serve the interests of justice. Whether to exercise the discretion or otherwise, the Court must necessarily have regard to all the facts and circumstances of the case, including the merits, though the view of the Court may be only prima facie. To hold that the merits should be completely excluded from consideration would be to put a restriction on Section 52 which has not been statutorily imposed. Though the operation of lis pendens is as a matter of law, the very same law recognizes that the doctrine confers on the Court a discretion to relieve a party from the operation of lis pendens. The law confers such a discretion in recognition of the fact that in a given case, the doctrine will result in serious inequity.
10. In the view that I take, I am supported by a decision of a learned Single Judge (Shri S.C. Gupte, J) in the case of Hilton Builders & Textiles Pvt. Ltd. (supra). The learned Judge considered the law on the subject which can be found in Paragraphs 9 to 16 thereof (the SCC OnLine report), and read as under:-
9. Section 52(1) of T.P. Act, as amended in State of Maharashtra, reads as under;10/23
8-nms-1397-18-s-1648-12.docx "Transfer of Property pending suit relating thereof.......... (1) During the pendency in any Court having authority within the limits of Indian excluding the State of Jammu and Kashmir or established beyond such limits by the Central Government of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, if a notice of the pendency of such a suit or proceeding is registered under section 18 of the Indian Registration Act, 1808, the property after the notice is so registered cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the right of any other party thereof under the decree or order which may be made therein; except under the authority of the Court and on such terms as it may impose"
10. The applicability of section 52 was considered by Privy Council in case of Gouri Dutt Maharaj (supra). After considering the broad purpose of section 52, Privy Council held as follows;
"The broad purpose of section 52 is to maintain the status quo unaffected by the act of any party to the litigation pending its determination. The applicability of the section cannot depend on matters of proof or the strength or weakness of the case on one side or the other in bona fide proceedings. To apply any such test is to misconceive the object of the enactment".
11. The principle that the doctrine of lis pendens applies irrespective of strength or weakness of the case on one side or the other was confirmed by the Supreme Court in the case of Kedarnath v. Sheonarain (supra). In that case, the Supreme Court held as follows;
"....... the doctrine of lis pendens applies irrespective of the strength or weakness of the case on one side or other. See Gouri Dutt Maharaj v. Sukur Mohammed, 75 Ind App 165 : A.I.R. 1948 P.C. 147. There is, however, one condition that the proceedings must be bona fide"
12. It is no doubt true, having regard to the law enunciated by the Privy Council and the Supreme Court in the cases noted 11/23 8-nms-1397-18-s-1648-12.docx above, that the doctrine of lis pendens as contained in section 52 of T.P. Act applies irrespective of the weakness or strength of the plaintiff's case, the only caveat being that the proceedings filed by the plaintiff must be bona fide. What this means is that in a proceeding filed bona fide the doctrine applies, if the conditions laid down therein are satisfied, namely, (i) that the suit or proceeding must be pending, (2) that such suit or proceeding must not be collusive, (3) that the suit or proceeding must be one in which the right to immovable property is directly and substantially in question, and (4) a notice of pendency of the suit is registered (applicable under the Maharashtra Amendment). Once these conditions are satisfied, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect any rights of the other party under any decree or order which may be passed therein. But we are not concerned here with the applicability of section 52 of T.P. Act. Section 52 surely applies in our case. But section 52 itself provides for the Court granting relief from lis pendens by authorizing a party to transfer the property on such terms as it may deem fit to impose. What we are concerned with is what are the circumstances in which, and the terms on which, the Court can in an appropriate case grant such relief.
13. This question was considered by our Court in two cases, which will be presently noted. In the case of B.J. Patel (supra), a learned Single Judge of this Court considered the principles applicable to granting of relief from lis pendens in the following words:
"4. The principles applicable to granting of relief from lis pendens are not available in any reported case nor are they given in the section. This being free from any reported case I have to form my own view as to what are the principles which are to be applied. Though, there cannot be an exhaustive enumeration of principles one thing is clear that this is a discretionary order and lis pendens is a rule and relief is an exception and strong grounds must be made out to deprive the plaintiff of the fruits of litigation.
5. This being a discretionary relief, it must depend on the several circumstances which inter alia, can be, the nature of the plaintiff's case and the defence, the nature of property market and the circumstances of 12/23 8-nms-1397-18-s-1648-12.docx the defendants. If the Court is convinced on the affidavits and the pleadings that even if all the evidence was led by the parties there is a very strong probability that the plaintiff will lose the matter, it will be a very important factor, possibly conclusive for granting relief. The Court will also have to consider the inconvenience and injustice that is likely to be caused to the defendants if the relief is not granted and balance it with the inconvenience and injustice that is likely to be caused to the plaintiff if the relief from lis pendens is granted"
14. In the case of Shantilal J. Khona (supra), a learned Single Judge of this Court considered various aspects which are required to be borne in mind when the Court considers an application for relief from lis pendens. The learned Judge spelt out these aspects as follows:
"While considering the issue to my mind this Court must pose to itself, atleast the following questions which are not exhaustive:
(i) Is it a requirement of the section that a Party can be relieved of lis pendensonly on a Court imposing conditions. Is imposition of condition a pre- requisite?
(ii) Whether on the facts as pleaded will the plaintiff prima facie, be entitled to the relief of specific performance of the contract.
(iii) If the Court comes to the conclusion that specific relief cannot be granted, then whether considering the alternative relief of damages which the plaintiff in the suit for specific performance is entitled to, whether the plaintiff should be secured.
(iv) If to be secured should it only be the market value of the property on the date of the suit at time when the suit is filed be considered"
15. In a recent judgment, the Supreme Court in the case of Vinod Seth v. Devinder Bajaj (supra) held as follows:
"The principle underlying section 52 of T.P. Act is based on justice and equity. The operation of the bar under section 52 is however subject to the power of the Court to exempt the suit property from the operation of section 52 subject to such conditions it may impose. That means that the Court in which the 13/23 8-nms-1397-18-s-1648-12.docx suit is pending, has the power, in appropriate cases, to permit a party to transfer the property which is the subject-matter of the suit without being subjected to the rights of any party to the suit, by imposing such terms as it deems fit".
16. The doctrine of lis pendens confers on the plaintiff a valuable statutory right. If the conditions of applicability of the doctrine are satisfied, the subsequent transfers of property are not binding on him and he can enforce his rights in the suit against all sub sequent transferees without initiating any proceedings against the subsequent transferees. This statutory right is, however, subject to the power of the Court to exempt the suit property from the operation of the doctrine in an appropriate case on such terms and conditions as the Court may deem fit and proper. This essentially means that the matter of relief from lis pendens is within the discretion of the Court and in an appropriate case, the Court may authorize the defendant to deal with the suit property without being affected with the plaintiffs' statutory right under the doctrine of lis pendens."
11. I must mention that this decision of the learned Single Judge was subjected to an appeal being Appeal (L) No. 397/2013 in Notice of Motion No. 2508/2011 in Suit No. 426/2007 (decided on 9th October, 2013). The Division Bench of this Court (Dr. D.Y. Chandrachud and M.S. Sonak, JJ), after a detailed discussion on the subject, dismissed the appeal. The relevant Paragraphs of this decision read thus :-
"9. Section 52 of the Transfer of Property Act, 1882 has been amended in relation to the State of Maharashtra by Act VI of 1939. The Statement of Objects and Reasons accompanying the introduction of the bill for the amendment provides that there was no provision in Section 52 as enacted, providing for compulsory registration or giving notice of a pending suit or 14/23 8-nms-1397-18-s-1648-12.docx action by a party claiming benefit under the section. The result was that bona fide purchasers for valuable consideration may suffer loss for want of notice, that the properties purchased by them had been included in a pending action. The amendment of Section 52 was intended to supplement the provisions and to make registration of the lis pendens a condition precedent to the operation of the provisions. Section 52 as amended in relation to this State, provides as follows:-
"Transfer of property pending suit relating thereof .....(1) During the pendency in any Court having authority within the limits of India excluding the State of Jammu and Kashmir or established beyond such limits by the Central Government of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, if a notice of the pendency of such a suit or proceeding is registered under section 18 of the Indian Registration Act, 1808, the property after the notice is so registered cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the right of any other party thereof under the decree or order which may be made therein; except under the authority of the Court and on such terms as it may impose."
10. Now, it is a well settled principle of law ever since the decision of the Privy Council in Gouri Dutt Maharaj vs. Sukur Mohammed, [AIR (35) 1948 PC 147] that the purpose of Section 52 is to maintain status quo in effect by any act of a party to the litigation pending its determination. Similarly, it is well settled that the operation of the doctrine of lis pendens does not depend upon the strength or weakness of the case of the Plaintiff or, as the case may be, of the Defendant, in bona fide proceedings. This principle has been recognised in the judgment of the Supreme Court in Kedarnath vs. Sheonarain [AIR 1970 SC 1717]. Consequently, the doctrine of lis pendens operates as a matter of law subject only to the condition that the proceedings which have been instituted by the Plaintiff must be bona fide. What Section 52 postulates is that: (i) A suit or proceeding must be pending; (ii) The suit or proceeding must not be collusive; (iii) A right to immovable property must be directly and specifically in question; and
(iv) A notice of the pendency of the suit or proceeding must be 15/23 8-nms-1397-18-s-1648-12.docx registered under Section 18 of the Indian Registration Act, 1908 (this last requirement being the amendment applicable to the State of Maharashtra). Once these requirements are satisfied, the property, after a notice is so registered, cannot be transferred or dealt with by any party to a suit or proceeding, so as to affect a right of any other party under a decree or order which may be made therein except under the authority of the Court and on such terms and conditions as the Court may deem fit to impose. The doctrine of lis pendens in other words does not annul or invalidate a dealing by a party to the suit but renders it subordinate to the rights of the other party to a litigation.
11. Section 52 confers a wholesome discretion on the Court as a result of which the operation of the doctrine of lis pendens can be lifted on such terms and conditions as the Court thinks fit to impose. The Court has a discretion, which like all other discretion in law, has to be exercised on judicious considerations. Whether a party should be relieved from the operation of lis pendens is a matter of discretion. Similarly, if the Court were to decide to relieve a party of the operation of the doctrine, it has been vested with the discretion to prescribe the terms and conditions which would sub-serve the interests of justice. In considering the interests of justice for the purpose of determining as to whether a party should be relieved from the operation of lis pendens, the Court must necessarily have regard to all the facts and circumstances of the case. The facts and circumstances of the case must undoubtedly include the merits prima facie. To hold that the merits should be completely excluded from consideration while assessing whether the discretion should be exercised would be to read a restriction which Section 52 has not statutorily imposed. On the contrary, where the statute allows the Court under its authority and on such terms and conditions as it may impose to relieve a party of the embargo which is imposed by the provision, the court should not read restrictions which would substantially dilute the efficacy of the provision. The operation of lis pendens is as a matter of law. But the same law which recognises the doctrine confers on the Court a discretion to relieve a party of the operation of lis pendens. The law confers such a discretion in recognition of the fact that in the facts of a given case, the doctrine will 16/23 8-nms-1397-18-s-1648-12.docx result in serious inequity.
12. The reason why the Court has been vested with a discretion to relieve a party of the operation of lis pendens is that the pendency of a suit and the registration of a lis pendens (as required in Maharashtra) substantially restricts the freedom of a party to secure a buyer at a fair market value. The Supreme Court has recognised that the mere filing of a suit may be an ingenious way to create a cloud over the title of a party. The suit may remain pending over a long period of time. This has been recognized in the decision of the Supreme Court in Vinod Seth vs. Devinder Bajaj, [(2010) 8 SCC 1] in the following observations:-
"We also agree with the High Court that having regard to the doctrine of lis pendens embodied in section 52 of the Transfer of Property Act, 1882 ('TP Act' for short), the pendency of the suit by the appellant shackled the suit property, affected the valuable right of the second defendant to deal with the property in the manner she deems fit, and restricted her freedom to sell the property and secure a fair market price from a buyer of her choice.
When a suit for specific performance is filed alleging an oral agreement without seeking any interim relief, the defendant will not even have an opportunity to seek a prima facie finding on the validity of the claim. Filing such a suit is an ingenious way of creating a cloud over the title to the suit property. Such a suit, filed in the Delhi High Court, is likely to be pending for a decade or more. Even if a defendant owner asserts that his property is not subject to any agreement and the said assertion is ultimately found to be true, his freedom to deal with the property as he likes or to realize its true market value by sale or transfer is adversely affected during the pendency of the suit. The ground reality is that no third party would deal with a property in regard to which a suit for specific performance is pending. This enables an unscrupulous plaintiff to cajole and persuade a defendant to sell/give the property on plaintiff's terms, or force the defendant to agree for some kind of settlement."
Again while emphasizing that the principle underlying Section 17/23 8-nms-1397-18-s-1648-12.docx 52 is based on justice and equity, the Supreme Court held as follows : -
"The principle underlying section 52 of the TP Act is based on justice and equity. The operation of the bar under Section 52 is however subject to the power of the court to exempt the suit property from the operation of section 52 subject to such conditions it may impose. That means that the court in which the suit is pending, has the power, in appropriate cases, to permit a party to transfer the property which is the subject matter of the suit without being subjected to the rights of any party to the suit, by imposing such terms as it deems fit. Having regard to the facts and circumstances, we are of the view that this is a fit case where the suit property should be exempted from the operation of Section 52 of the TP Act, subject to a condition relating to reasonable security, so that the defendants will have the liberty to deal with the property in any manner they may deem fit, in spite of the pendency of the suit."
13. A learned Single Judge of this Court in B.J.Patel vs. Vadilal Dolatram and Sons, (AIR 1982 Bombay 66) had occasion to consider the principles on the basis of which the discretion under Section 52 is to be exercised. Justice Mody sitting singly held as follows :-
"Though, there cannot be an exhaustive enumeration of principles one thing is clear that this is a discretionary order and lis pendens is a rule and relief is an exception and strong grounds must be made out to deprive the plaintiff of the fruits of litigation.
This being a discretionary relief, it will depend on the several circumstances which inter alia, can be, the nature of the plaintiff's case and the defence, the nature of property market and the circumstances of the defendants. If the Court is convinced on the affidavits and the pleadings that even if all the evidence was led by the parties there is a very strong probability that the plaintiff will lose the matter, it will be a very important factor, possibly conclusive for granting relief. The Court will also have to consider the inconvenience and injustice that is likely to be caused to the defendants if the relief is not granted and balance it with the inconvenience and injustice that is likely to be caused to the plaintiff if the relief from lis pendens is 18/23 8-nms-1397-18-s-1648-12.docx granted."
The earlier decision was considered in a subsequent judgment of Mr.Justice F.I.Rebello (as the Learned Judge then was) in Shantilal Jethabai Khona vs. Anandrai Shivlal Dave. [(2002 (3) Bom.C.R. 346] The learned Judge referred to some of the considerations which must be borne in mind, clarifying that these were not intended to be exhaustive:-
"While considering the issue to my mind this Court must pose to itself, at least the following questions which are not exhaustive:-
(i) Is it a requirement of the section that a party can be relieved of lis pendens only on a Court imposing conditions.
Is imposition of condition a prerequisite?
(ii) Whether on the facts as pleaded will the plaintiff prima facie, be entitled to the relief of specific performance of the contract.
(iii) If the Court comes to the conclusion that specific relief cannot be granted, then whether considering the alternative relief of damages which the plaintiff in the suit for specific performance is entitled to, whether the plaintiff should be secured.
(iv) If to be secured should it only be the market value of the property on the date of the suit at time when the suit is filed be considered."
12. It is on the touchstone of these principles that I now have to decide whether defendant No.1 would be entitled to the relief of relieving him from the doctrine of lis pendens under Section 52 of the Transfer of Property Act, 1882. In the present case, the suit is filed seeking specific performance of the Minutes of the Meeting dated NIL February, 2011. These Minutes can be found at Exhibit- 19/23 8-nms-1397-18-s-1648-12.docx "J" to the plaint. On going through these Minutes, at least prima facie, it appears that there was no concluded contract between the plaintiff and defendant No.1. There are several blanks in the Minutes of the Meeting including the date. Further there are several notes in the Minutes of the Meeting such as in Paragraph 6 which states that if the period of lease granted by the Municipal Corporation of Greater Mumbai would be for 30 years, then, the commercial repercussions would have to be considered. Even the stamp duty and registration charges and who was to pay the same was under consideration. Further these alleged Minutes have not been signed by either the plaintiff or by defendant No.1. On a holistic reading of these minutes, prima facie I am not convinced that there is any concluded contract between the parties. In fact, when I enquired from the Advocate of the plaintiff that according to the plaintiff on what date the contract was concluded, he was unable to give any exact date. Prima facie, it appears that these Minutes, at the highest, only record the negotiations that were going on between the parties and which did not fructify into any concluded contract. In fact, this is also the finding of another learned Single Judge (as he then was) [B. R. Gavai J.] in this very suit when Notice of Motion No.1794/2012 was pressed for ad-interim reliefs. Paragraph 4 of 20/23 8-nms-1397-18-s-1648-12.docx this order reads thus:-
"4. The perusal of the material on record would reveal that claim of the plaintiffs is basically on the basis of the so called minutes of the meeting, which according to the plaintiffs reduce the terms and conditions of the agreement between them in writing. The perusal of the said minutes would show that they are signed by none of the parties. Apart from that the entire communication placed on record would reveal that the matter was only at the stage of negotiations and no final agreement had been arrived at between the parties. It can thus clearly be seen that there was no privity of contract between the plaintiff and defendant No.1. Insofar as payment of Rs.40,00,000/- is concerned, it is the case of the plaintiff that the said amount is paid by cash. It is difficult to believe that such huge amount would be paid by cash and that too without receipt to the defendant. One more fact that needs to be noted is that in the public notice published by the plaintiffs on 26th March, 2012, the plaintiffs themselves have referred to the transaction between the plaintiffs and the defendant No.1 to be at the stage of negotiations."
13. I must mention that subsequently Notice of Motion No. 1794 of 2012 was unconditionally withdrawn by the plaintiff on 22nd January, 2015. Even as far as the alleged payment of Rs.40 lakhs by the plaintiffs to defendant No.1 is concerned, there is nothing on record to show that in fact such a payment was made. No receipts have been produced in respect thereof. In fact, defendant No.1 in its written statement has categorically denied the receipt of the 21/23 8-nms-1397-18-s-1648-12.docx aforesaid amount. As far as the payment of Rs. 11,36,000/- made to defendant No.2 is concerned, it is the case of defendant No.2 that this was payment towards professional services rendered to the plaintiff and in fact the plaintiff has not even claimed a refund of this amount in the suit, even as an alternative prayer.
14. Looking to the totality of the facts of the case and considering that I have come to a prima facie finding that there was no concluded contract, it would be highly inequitable to continue the cloud on the title of the suit property, which is, admittedly, owned by defendant No.1. I am of the prima facie view that in the facts of the present case, even after the plaintiff is allowed to lead evidence, his chances of success on the present suit are dismal to say the least.
15. In the light of the foregoing discussion, I find that it would be in the interest of justice if the following order is passed:-
Defendant No.1 shall be entitled to deal with the suit property as he may deem fit, without the same being subjected to the operation of lis pendens under Section 52 of the Transfer of Property Act, 1882.
16. The Notice of Motion is accordingly disposed of. 22/23 8-nms-1397-18-s-1648-12.docx There shall be no order as to costs.
17. Place the suit on board for framing issues on 3rd July, 2019.
(B.P. COLABAWALLA, J.) 23/23 8-nms-1397-18-s-1648-12.docx