Gujarat High Court
Jagdishbhai Maganbhai Desai vs Rashmi Buildcon on 25 September, 2023
NEUTRAL CITATION
C/AO/91/2023 ORDER DATED: 25/09/2023
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/APPEAL FROM ORDER NO. 91 of 2023
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2023
In R/APPEAL FROM ORDER NO. 91 of 2023
With
R/APPEAL FROM ORDER NO. 122 of 2023
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2023
In R/APPEAL FROM ORDER NO. 122 of 2023
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JAGDISHBHAI MAGANBHAI DESAI & 6 other(s)
Versus
RASHMI BUILDCON
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Appearance:
MR BHARGAV BHATT, ADVOCATE with MR RUTVIJ S OZA(5594) for the
Appellant(s) No. 1,2,3,4,5,6,7
for the Respondent(s) No. 2.2,2.3,2.5
MR RASHESH SANJANWALA, SR ADVOCATE assisted by MR SUNIL S
JOSHI(2925) for the Respondent(s) No. 2,2.1
NOTICE SERVED for the Respondent(s) No. 1,2.4
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CORAM:HONOURABLE MS. JUSTICE S.V. PINTO
Date : 25/09/2023
ORAL ORDER
1. Appeal from Order No.91 of 2023 has been filed at the instance of the appellants herein original plaintiffs against the order passed by the learned Additional Senior Civil Judge, Ahmedabad (Rural) at Mirzapur on 23.3.2023 whereby the learned trial Judge was pleased to dismiss the applications at Exh.5 and Exh.27 filed by the appellants Page 1 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined herein original plaintiffs in Special Civil Suit No.449 of 2022, whereas Appeal from Order No.122 of 2023 has been filed at the instance of the appellants herein original defendant Nos.2.1 to 2.3 against a portion specifically paragraph No.8.5 and final order paragraph No.2 of the order passed by the learned Additional Senior Civil Judge, Ahmedabad (Rural) at Mirzapur on 23.3.2023 in Special Civil Suit No.449 of 2022.
2. The facts leading to the filing of these appeals may be summarized as follows: -
2.1 It is the case of the appellants - original plaintiffs that they have filed Special Civil Suit No.449 of 2022 along with interim injunction application at Exh.5 inter alia praying that land situated at District Sub-District Ahmedabad-7 (Odhav) Ta. Vatva (Old Taluka City) bearing survey No. 137 admeasuring 23647 Sq. Mtr., survey No. 138 admeasuring 10522 Sq Mtr., Survey No. 142 admeasuring 10927 Sq.Mtr., Survey No. 143 admeasuring 10825 Sq. Mtr., survey No. 183 admeasuring 20032 Sq. Page 2 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023
NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined Mtr, and survey No. 184 admeasuring 18008 Sq. Mtr., totaling 93988 Sq. Mtrs. which is included in final plot No.1 of Town Planning Scheme no.112 (Odhav) and as per the present F-form the measurement of the land is 56243 Sq.Mtrs., out of the aforesaid measurement, land admeasuring 21514.85 Sq. Mtrs. converted into industrial purpose may not be transferred, alienated or right, title or interest be created on the aforesaid land by the original defendants, their servants or agents in favour of any other person, company, firm, society or to any other entity and further prayed to direct that no mortgage, loan or any third party rights be created, the possession of the aforesaid land shall not be transferred or no development may be carried out on the aforesaid land till the final disposal of Special Civil Suit No.449 of 2022.
2.2 Upon receipt of the notice issued by the learned trial court, the original defendants Nos.2.1 to 2.3 and 2.5 have appeared through their advocates and filed written statement at Exhibit-15 to the plaint and reply to the Page 3 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined interim injunction application at Exh.5. Thereafter, the appellants - original plaintiffs have filed the affidavit-in- rejoinder at Exh.18 to the written statement filed by the respondents herein. The original defendant No.2.4 has chosen not to appear in the suit proceedings though notice was served and therefore, the learned Court has passed an order to proceed ex-parte qua him. The original plaintiffs- appellants herein have preferred an application at Exh.27 for granting status-quo till the Exh.5 application may not be decided.
2.3 The learned Additional Senior Civil Judge, Ahmedabad (Rural) at Mirzapur after hearing learned advocates for the parties vide order dated 23.03.2023 decided the interim injunction application in Special Civil Suit No.449 of 2022 and rejected the applications at Exh.5 and Exh. 27 and further directed the original defendant Nos.1 and 2 to file an undertaking under Section 144 of the Code of Civil Procedure as per paragraph 8.5 in respect of the suit property within 15 days from the date of order Page 4 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined dated 23.03.2023 and further, observed that in the event of third party rights being created in the suit property, then in the document of that transaction it should be mentioned that the said transaction will be subject to outcome of the aforesaid suit as the suit is pending before the learned trial Court. The learned trial court further observed in the operative portion of the order that any development or construction on the suit property or transfer shall be subject to the ultimate decision of the suit. 2.4 After the impugned order dated 23.03.2023, the original defendant Nos.2.1 to 2.3 have preferred an application under Section 151 of the Code of Civil Procedure, 1908 praying for partial recall of the aforesaid order passed below Exh.5 and Exh.27 in the suit along with the application for interim stay of the operation of the part of the order dated 23.03.2023 and thereafter, original plaintiffs have filed objection to the aforesaid application dated 05.04.2023 for recall. After that, an application for Page 5 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined extension of time to comply with the directions issued by the learned Trial Court was preferred on 07.04.2023. 2.5 Being aggrieved and dissatisfied with the impugned order dated 23.03.2023 passed below the applications at Exh.5 and Exh.27 in Special Civil Suit No.449 of 2022, the appellants - original plaintiffs have preferred the present Appeal from Order under Order 43 Rule 1 of the Code of Civil Procedure, 1908.
3. Learned advocate Mr.Bhargav Bhatt appearing for learned advocate Mr.Rutvij Oza for the appellants - original plaintiffs submits that the sale deed was executed between the appellants - original plaintiffs and respondents with specified consideration mentioned in the sale deed for the portion of land from FP-1 Odhav, TP Scheme [the amount which was deposited in the year 2015 as deposit through RTGS and for the rest of amounts different numbers of cheques were given with an understanding to deposit requisite TDS in each appellants account]. Mr.Bhatt has Page 6 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined further submitted that the sale deed neither expressly nor impliedly suggests that the amount of consideration stated at paragraph 5 of sale deed or the promise on the part of respondents is not to be paid at all or to be paid in future event and not stated about such understanding in the written statement and therefore, the respondents have purchased the suit land with the agreed price and paid the consideration agreed in paragraph 5 of the sale deed by tendering 21 cheques and have further agreed to deposit amount of TDS in favour of each seller.
3.1 Mr.Bhatt has further submitted that the respondents have requested not to deposit the cheques as the land had become subject to a litigation between the erstwhile owners i.e. the land owners and tenants as referred in the written statement filed by the defendants - respondents after execution of the sale deed and the respondents have deferred the payments of cheques mentioned in the sale deed and upon expiry of six months, the appellants have returned the cheques for giving fresh as Page 7 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined per terms mentioned in the sale deed and the respondents have not executed fresh cheques in lieu of the expired cheques, and therefore have failed to honour the part of their promise to make the contract of sale complete. Mr.Bhatt has further submitted that the appellants - original plaintiffs had not given possession nor opted for development permission from AMC for sub-division of plots until the defendants have not asked him to do so and on 13.09.2021, the plaintiffs have paid the requisite tax to Ahmedabad Municipality for unpaid tax in respect of FP-1 Odhav TP Scheme, and thereafter sought permission to develop by subdivision of plots and in other words, the plaintiffs have initiated process to complete the sale and thereby made their promise good so as to make the contract of sale meaningful upon the expectation that the defendants
- respondents will complete their part of promise and make the sale complete as they have represented to give balance consideration at the time of development of property.
Page 8 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined 3.2 Mr.Bhatt has further submitted that the plaintiff
No.5 was shocked, when he has found that the defendants have applied for RERA permission, without disclosing the factum of unpaid considerations over the portion of land they are holding from FP-1 Odhav TP Scheme and without disclosing factum of pendency of tenancy proceedings and therefore raised objections and later on after having complete details from the plaintiff no.3, all plaintiffs have issued notice as well as raised objections and the factum of charge contemplated under section 55 [4] of the Transfer of Property Act is admitted by the defendants in their reply before the RERA. Mr.Bhatt has further submitted that the defendants had raised a plea that at the time of execution of the sale deed, it was agreed between the parties that the balance consideration is to be paid upon the termination of tenancy proceedings but such defense is untenable in light of express provision of Section 92 of Evidence Act and at the same time, the arrangements made upon the intervention of the third parties as mentioned in the plaint with affidavit in support is having admissibility in light of section proviso [4] Page 9 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined as the same being distinct subsequent oral agreement and in any way, the defence of the defendants and non-payment of remaining consideration is neither genuine nor having any legal bases. Mr.Bhatt has further submitted that therefore, the plaintiffs have prayed for recovery of charge - unpaid consideration together with interest and in the alternate setting aside of the sale deed on the ground of misrepresentation defined under section 18 of the Contract Act, which renders the sale voidable at the option of party. 3.3 Mr.Bhatt has further submitted that during the pendency of hearing of Ex.5 application, the objections were raised before the RERA that developers have not disclosed the charge amounting to encumbrance in violation of Section 4[l][A] and thereby committed an offense under Section 60 of the Act and the developer had materially suppressed the title report and last two pages of the same are deliberately not produce before the RERA. Mr.Bhatt has further submitted that the RERA has completely ignored the submissions and without dealing with it and without Page 10 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined informing the appellants, the RERA had granted registration of project in favour of defendants which is challenged by way of filing Special Civil Application No.912 of 2023 and the same is pending for adjudication. Mr.Bhatt has further submitted that the impugned order suffers from infirmities, surmises and conjectures and hence the same deserves to be quashed and set aside. It is pertinent to note that though the learned trial Court has recorded that it is an admitted fact that the total amount of consideration is not paid to the original plaintiffs and the same is clear from the record. The learned trial Court has failed to appreciate the fact that equity is in favour of the original plaintiffs when the fact is clearly emerging that the total consideration amount is not paid by the original defendants. Further, the learned trial Court ought not to have come to the conclusion that the prayer of the original plaintiffs to cancel the sale deed is not required to be granted as from the record, it prima facie appears that the original plaintiffs are not entitled to get relief while it was clearly believed by the learned trial Court that total consideration amount is not Page 11 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined paid to the original plaintiffs and when in the prayer clause, it was specifically mentioned by the original plaintiffs that they are ready and willing to return the amount of part consideration with 10% interest and hence, the impugned order is in total ignorance of principle embodied in section 10 to 19 of the Contract Act dealing with void and voidable contracts.
3.4 Mr.Bhatt has further submitted that the learned trial Court ought to have appreciated the provisions of Sections 54 and 55 of the Transfer of Properties Act as the said provisions are very much clear that if the consideration amount for the suit property is in pursuance of the sale deed, then the said document will be null and void. The learned trial Court has failed to appreciate the aforesaid provisions of law when the learned trial Court has come to the conclusion that total consideration amount is not paid to the appellants herein by the respondents and hence, the impugned order is required to be quashed and set aside in the interest of justice. The learned trial Court has failed in Page 12 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined appreciating the fact that the respondents have made false claims and took false defenses to drag the appellants into unscrupulous litigation with a view to grab the land without paying the total consideration amount. The learned trial Court had failed to appreciate the provisions of Section 55 of the Transfer of Property Act, which categorically states that the unpaid amount of sale consideration is "charge" over the property and conduct of the defendants clearly suggests that the defendants are intending to transfer the property to third party, without satisfying "charge". 3.5 Mr.Bhatt has further submitted that the learned trial Court has not appreciated the overall facts and the documents produced on record, which clearly reveals that there is no such consensus arrived between the parties to the sale deed that the original defendant will have to pay the remaining consideration amount only after termination of the litigation. The said defense is not in writing and original defendants are taking a sham and bogus defense for not paying a total consideration amount. The defense raised is Page 13 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined also hit by express provisions of Sections 91 and 92 of the Indian Evidence Act, 1872. Otherwise also the learned trial Court had failed to appreciate the judgment passed in the case of Rushabh Gayaprasad, which is binding precedent upon the learned trial court and the decision in the aforesaid case is also confirmed by the Hon'ble Apex court, in as much as the petition against the judgment and order passed in the case of Rushabh Gayaprasad is failed at admission stage before the Hon'ble Apex Court. 3.6 Mr.Bhatt has further submitted that the conduct of the parties can be gathered by the defense and pleading of the parties. The sale deed was executed on 12.04.2016 and passing of possession as well as application for development permission in the year 2021, was made upon the misrepresentation of facts, which renders the sale voidable at the option of parties as defined under the Indian Contract Act. However, without applying judicious consideration, the learned trial court had rejected the injunction application. The defense of the original Page 14 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined defendants that there exists understanding between the parties to Sale of suit property to defer the part payments till conclusion of all the proceedings initiated by the erstwhile owners and therefore the original plaintiffs are not entitled to recover the remaining sale consideration is not only dishonest but difficult to comprehend by any man having reasonable prudence. The original defendant's further plea to the effect that they are entitled to sell the suit property to third party with defective title and realize the gain out of suit property, without satisfying the charge over the property clearly reveals the ill-intention of the original defendants to cause wrongful loss to the present appellants and at the same time to derive wrongful gain from the purchasers of shades.
3.7 Mr.Bhatt has further submitted that there was no certificate granted by the RERA in favour of original defendants at the time of institution of suit, and same was granted only on 4.11.2022, without passing an order on the objections raised by original plaintiffs and without Page 15 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined communicating disposal of the objections to the appellants. The appellants have challenged the aforesaid certificate dated 4.11.2022 by way of a writ petition being Special Civil Application No.912 of 2023 before this Court and in spite of appraising the learned trial Court about all these salient facts in details branding the defendants wrong doer, the learned trial Court has rejected the injunction applications. Mr.Bhatt has further submitted that though the learned trial Court had arrived at the finding at paragraph 8.1 to the effect that in light of averments made by original defendants in their reply dated 06.08.2022 before the RERA at paragraph 8[D], the amount stated in the sale deed is not paid to the original plaintiffs - appellants and it is apparent from the admission on the part of original defendants that the defense taken by them is sham and bogus with an intention to not pay the total consideration amount and hence, the defense taken by the original defendants as argued earlier is in contravention of Section 92 of the Evidence Act.
Page 16 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined 3.8 Mr.Bhatt has further submitted that the
impugned order is unjust, illegal and perverse because mere undertaking in terms of Section 144 of the Code, neither guarantees nor ensures the payment of balance considerations, when the defendants are creating third party interests and allowing to pass the possession of the property in favour of third party and hence the learned trial Court ought to have directed the original defendants to deposit sufficient security. Mr.Bhatt has further submitted that the defendants have not paid price in full and by paying about 40% of price, they have started developing the suit land referred in the sale deed and the 60% land for which consideration is not paid, the defendants have no right or authority to develop the same nor derive gain out of it by transferring the same to any third party. The act of nonpaying the agreed sale consideration and developing the same against the wish of plaintiffs renders the status of the defendants as "wrong doer". In other words, the defendants being wrong doers, deriving profit out of subject land which they are not entitled to and therefore fruits they derive out Page 17 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined of the subject land is required to be returned to the plaintiffs on the basis of principle of unjust enrichment. In support of his submission, Mr.Bhatt has placed reliance upon paragraph-29 of the decision in the case of Rameshwar & Ors. Vs. State of Haryana & others, reported in (2018) 6 SCC 215 which reads as under.
"29 The decisions referred in the preceding paragraphs were delivered in the context of exercise of power under the provisions of the Act. In addition, there are few other decisions which were rendered in other fields but considered the issues regarding "fraud on power"; notable amongst them being: S. Pratap Singh v. The State of Punjab, (1964) 4 SCR 733, Express Newspapers Pvt. Ltd. and others v. Union of India and others, (1986)1 SCC 133 and observations by R.M. Sahai J in Shrisht Dhawan (Smt) v. Shaw Bros., (1992) 1 SCC 534, at page 553. The issue concerning unjust enrichment was dealt with by this Court very succinctly in Indian Council for Enviro-Legal Action v. Union of India, (2011) 8 SCC 161, at page 234 as under :
"151. Unjust enrichment has been defined as: "Unjust enrichment.-A benefit obtained from another, not intended as a gift and not legally justifiable, for which the beneficiary must make restitution or recompense."
See Black's Law Dictionary, 8th Edn. (Bryan A. Garner) at p. 1573. A claim for unjust enrichment arises where there has been an "unjust retention of a benefit to the loss of another, or the retention Page 18 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined of money or property of another against the fundamental principles of justice or equity and good conscience".
152. "Unjust enrichment" has been defined by the court as the unjust retention of a benefit to the loss of another, or the retention of money or property of another against the fundamental principles of justice or equity and good conscience. A person is enriched if he has received a benefit, and he is unjustly enriched if retention of the benefit would be unjust. Unjust enrichment of a person occurs when he has and retains money or benefits which in justice and equity belong to another.
153. Unjust enrichment is "the unjust retention of a benefit to the loss of another, or the retention of money or property of another against the fundamental principles of justice or equity and good conscience". A defendant may be liable "even when the defendant retaining the benefit is not a wrongdoer" and "even though he may have received [it] honestly in the first instance". (Schock v. Nash, 732 A 2d 2017 (Delaware 1999), A 2d, 232-33.)
154. Unjust enrichment occurs when the defendant wrongfully secures a benefit or passively receives a benefit which would be unconscionable to retain. In the leading case of Fibrosa Spolka Akcyjna v. Fairbairn Lawson Combe Barbour Ltd., 1943 AC 32, Lord Wright stated the principle thus: (AC p. 61) "... Any civilised system of law is bound to provide remedies for cases of what has been called unjust enrichment or unjust benefit that is to prevent a man from retaining the money of or some benefit derived from another which it is against conscience that he should keep. Such remedies in English law are generically different from Page 19 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined remedies in contract or in tort, and are now recognised to fall within a third category of the common law which has been called quasi-contract or restitution."
155. Lord Denning also stated in Nelson v. Larholt, (1948) 1 KB 339 as under: (KB p. 343) "... It is no longer appropriate, however, to draw a distinction between law and equity. Principles have now to be stated in the light of their combined effect. Nor is it necessary to canvass the niceties of the old forms of action. Remedies now depend on the substance of the right, not on whether they can be fitted into a particular framework. The right here is not peculiar to equity or contract or tort, but falls naturally within the important category of cases where the court orders restitution, if the justice of the case so requires."
156. The above principle has been accepted in India. This Court in several cases has applied the doctrine of unjust enrichment.
........
159. Unjust enrichment is basic to the subject of restitution, and is indeed approached as a fundamental principle thereof. They are usually linked together, and restitution is frequently based upon the theory of unjust enrichment. However, although unjust enrichment is often referred to or regarded as a ground for restitution, it is perhaps more accurate to regard it as a prerequisite, for usually there can be no restitution without unjust enrichment. It is defined as the unjust retention of a benefit to the loss of another or the retention of money or property of another against the fundamental principles of justice or equity and good conscience. A person is enriched if he has received a benefit, and he is unjustly enriched if Page 20 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined retention of the benefit would be unjust. Unjust enrichment of a person occurs when he has and retains money or benefits which in justice and equity belong to another.
160. While the term "restitution" was considered by the Supreme Court in South Eastern Coalfields Ltd. v. State of M.P., (2003) 8 SCC 648 and other cases excerpted later, the term "unjust enrichment"
came to be considered in Sahakari Khand Udyog Mandal Ltd. v. CCE & Customs, (2005) 3 SCC 738. This Court said: (Sahakari Khand case, SCC p. 748, para 31) "31. ... `unjust enrichment' means retention of a benefit by a person that is unjust or inequitable. `Unjust enrichment' occurs when a person retains money or benefits which in justice, equity and good conscience, belong to someone else."
161. The terms "unjust enrichment" and "restitution" are like the two shades of green-one leaning towards yellow and the other towards blue. With restitution, so long as the deprivation of the other has not been fully compensated for, injustice to that extent remains. Which label is appropriate under which circumstances would depend on the facts of the particular case before the court. The courts have wide powers to grant restitution, and more so where it relates to misuse or non-compliance with court orders."
3.9 Mr.Bhatt has lastly urged to allow the appeal by setting aside the impugned order and to grant the injunction as prayed for in the injunction application at Page 21 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined Exh.5.
4. On the other-hand, learned senior advocate Mr.R.S.Sanjanwala appearing for the defendant Nos.2.1 to 2.3 has vehemently opposed the present appeal by contending that the sale deed contains a stipulation to the effect that all the cheques of the total sale consideration of Rs.17,45,45,000/- are handed over to the appellants by the respondents and it has been stated therein that in any event, if the vendee i.e. the appellants herein do not present the cheques for encashment within limitation or for any other reason, the amount of consideration is not received by the appellants, the appellants would only be entitled to the issuance of new cheques by the respondents herein. Mr.Sanjanwala has drawn the attention of this Court towards para 6 of the said sale deed to contend that the possession of the suit land is handed over to the respondents herein and in para 7 thereof, the appellants have undertaken to indemnify the respondents for any loss or damage on account of any litigation or dispute, etc. in Page 22 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined respect of the suit land. Mr.Sanjanwala has further submitted that the sale deed came to be executed on 12.4.2016 and for a long period of about 6 years, the appellants/plaintiffs never demanded the outstanding sale consideration only on account of the understanding reached between the parties as aforesaid. Mr.Sanjanwala has also drawn the attention of this Court that a number of litigation are contested jointly by the appellants and the respondents herein before the various forums including this Court as well as the Hon'ble Supreme Court in respect of the suit lands under the Tenancy Act, taken at the instance of the original owners of the said lands and in none of the proceedings, the appellants had never contended that such an amount of consideration is due and payable. 4.1 Mr.Sanjanwala has further submitted that even recently, in the year 2021, as the parties wanted to develop the suit lands, a requisite application was moved by the parties before the Ahmedabad Municipal Corporation for sanction of such development and sub-division of the suit Page 23 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined lands. The said application was opposed by one of the heirs of the tenants and a detailed hearing took place before the Assistant Municipal Commissioner (East Zone), AMC and the said authority by an order dated 31.8.2021 overruled such objections and forwarded the said request of sub- division to the concerned department of the AMC and in the course of hearing of the said objections also, the appellants never raised any grievance with regard to the so-called unpaid sale consideration. Mr.Sanjanwala has further submitted that on 02.10.2021, the AMC has granted the development permission in respect of the said land and pursuant to such permission, the respondents started developing the suit land and substantially carried out the same and thereafter applied for requisite permission under RERA Act in respect of the project proposed by the respondents viz. Rashmi Growth Hub. Mr.Sanjanwala has further submitted that on 21.5.2022, the appellants herein have submitted written objections before the RERA Authority to the issuance of such certificate in favour of the respondents herein, for the first time, raising a ground that Page 24 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined the respondent-firm has not paid the balance sale consideration to the appellants/plaintiffs. It is pertinent to note that in the said written objections, the appellants have stated that the cheque of remaining sale consideration of Rs.10,45,45,000/- is not handed over to the appellants by the respondents, whereas the sale deed clearly stipulates that all the cheques have been handed over to the appellants. The RERA Authority after considering the explanation/reply given by the respondents herein granted such permission, leaving the appellants herein to ventilate their grievance before the competent Civil Court. 4.2 Mr.Sanjanwala has further submitted that various stipulations in the sale deed as well as conduct on the part of the appellants and the attending circumstances as narrated above clearly go to show that an understanding was reached between the parties that the remaining sale consideration would be payable only on termination of the litigation initiated by the original owners under the Tenancy Act and the same is evidenced from the conduct of the Page 25 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined parties that the appellants never demanded the remaining sale consideration from the execution of the sale deed i.e. in the year 2016 till 2022 and it is only when the respondents herein started developing the land, the appellants resiled from the said understanding and raised the untimely demand of the balance sale consideration in spite of the fact that the litigation in respect of the said land under the Tenancy Act is still pending before the Gujarat Revenue Tribunal. Mr.Sanjanwala has further submitted that the appellants have relied upon the provisions of Section 55(4)
(b) of the Transfer of Property Act in contending that they are the unpaid seller and therefore have charge over the suit land. It is respectfully submitted that the creation of charge of unpaid seller is not absolute because a bare reading of Section 55(4)(b) of the Transfer of Property Act goes to show that the creation of such charge arises only in the absence of a contract to the contrary. In the present case, as stated above, there exists a contract to the contrary as there was an understanding reached between the parties that the remaining sale consideration was to be paid by the Page 26 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined respondents to the appellants only after the finality of the litigation under the Tenancy Laws.
4.3 Mr.Sanjanwala has further submitted that assuming without admitting that the provisions of Section 54(4)(b) of the Transfer of Property Act are attracted in the instant case, still however, the suit filed by the plaintiffs is in relation to recovery of balance sale consideration. It is respectfully submitted that one of the important ingredients / factors in granting the interim injunction is causing of irreparable loss to the parties seeking such relief. In the present case, as the suit is for recovery of money, no irreparable loss is going to be caused to the appellants/original defendants, in the event of refusal of prayer of interim injunction made by the appellants. Mr.Sanjanwala has further submitted that within the knowledge of the plaintiffs, who are the owners of an adjoining land to the suit land, the construction over the suit land was commenced by the respondents herein after 02.10.2021 i.e. grant of development permission and by the Page 27 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined time, the suit came to be filed in October-2022, substantial construction was over and by the time, the application for interim injunction, i.e. Exh.5 came to be heard and decided, the construction was already completed and in respect of number of units, the third party rights came to be created and that the details thereof were given by the defendants before the learned Trial Judge. Further, in the course of hearing of application Exh. 5, the respondents herein gave a purshis before the learned Trial Judge that the respondents herein have completed 100% construction and spent Rs.18,27,58,179/- in the said construction and put up 303 units on the said land and have executed registered agreements to sell in relation to 35 units in favour of third parties and have received bookings of 115 units. In the course of hearing of an application Exh. 5 filed before the learned Trial Judge, the respondents herein had stated at bar that the respondents herein are ready and willing to incorporate a clause in the sale deeds disclosing the pendency of the present civil suit in all the sale deeds which the respondents would henceforth execute. Thus, the Page 28 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined original plaintiffs are guilty of delay and laches and the principles of acquiescence and therefore not entitled to any equitable prayer for interim injunction. Mr.Sanjanwala has drawn the attention of this Court towards the decision of the Hon'ble Apex Court reported in (2009) 11 SCC 229 to contend that conduct of party is very much relevant in deciding any application filed under Order 39 Rule 1 and 2 of CPC. Mr.Sanjanwala has also drawn the attention of this Court towards the decision of the Hon'ble Apex Court reported in (2008) 11 SCC 1 to contend that conduct of parties is also a relevant factor in deciding equitable relief of injunction and a person seeking injunction after long lapse of time by allowing the other party to deal with the property exclusively is ordinarily not entitled to injunction. Mr.Sanjanwala has further submitted that the relief for cancellation of sale deed cannot be granted in favour of the appellants / original plaintiffs in as much as the Hon'ble Apex Court in (2020) 7 SCC 366 in the case of Dahiben vs. Arvindbhai and others in paras 29.8, 29.9, 29.16 and 29.17 has laid down the principles that the non-payment of part of Page 29 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined sale price would not affect the validity of the sale and sale could not be invalidated on this ground. 4.4 Mr.Sanjanwala has further submitted that the judgment of this Court reported in 2022 (0) AIJEL-HC- 24117 in the case of Rushabhbhai Gayaprasad Jain vs. Rameshbhai Bhimjibhai Koladiya relied upon by the appellants herein has no application to the facts of the present matter in as much as the same does not take into consideration the binding decision of the Hon'ble Apex Court reported in (2020) 7 SCC 366 and therefore, the same cannot be relied upon. It is submitted that this Court in the judgment rendered in Appeal from Order No.51 of 2021 dated 18.2.2022, after taking into consideration the judgment of the Hon'ble Apex Court in the case of Dahiben (supra), has refused to grant injunction on the ground of non-payment of sale consideration as well as creation of charge under Section 55(4)(b) of the Transfer of Property Act. Mr.Sanjanwala has further submitted that the Hon'ble Calcutta High Court in the judgment reported in 1932 SCC Page 30 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined Online Cal 52 has laid down the principles that under proviso 3 to Section 92 of the Evidence Act notwithstanding an admission in the sale deed that the consideration has been received, it is open to the vendor to prove that no consideration has actually been paid and it was no infringement of Section 92 for a court to accept proof that by a collateral agreement between the vendor and the purchaser, the consideration money remained with the purchaser for the purposes and the conditions agreed upon between the parties. So far as the contention on the part of the appellants as regards the principles of undue enrichment is concerned, it is respectfully submitted that as the said principles have no application at all and especially in view of the contract to the contrary/understanding between the parties, as narrated above, the said principles has no application. Lastly, Mr.Sanjanwala has urged this Court to dismiss the appeal.
5. Whereas the Appeal from Order No.122 of 2023 is filed being aggrieved by the observations made in paragraph Page 31 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined No.8.5 and final order paragraph No.2 of the impugned order.
6. This Court in Jivraj Tea Limited Vs Dayalji Vanravan Kotecha, reported in 2022(0)AIJEL-HC 244893 in paragraph 10 observed thus :
"10. It is well settled principles of law that in an Appeal against exercise of 'discretion' by the Court of first instance, the power of appellate Court to interfere with the exercise of discretion is restrictive. Merely because on facts, the appellate Court would have concluded differently from that of the Court below, that would not, by itself, provide justification for appellate Court to interfere. To justify interference, the appellant would have to demonstrate that the discretion has been shown to have been exercised arbitrarily or capriciously or perversely or where the Court had ignored the settled principles of law Page 32 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined regulating grant or refusal of interlocutory injunction. An appeal against the exercise of discretion is an appeal on principle.........."
7. In Wander Limited and another Vs Antox India P.Ltd, reported in 1990 (Supp) Supreme Court Cases 727, the Honourable Apex Court in paragraph 14 observed thus :
"14. The appeals before the Division Bench were against the exercise of discretion by the Single Judge. In such appeals, the appellate court will not interfere with the exercise of discretion of the court of first instance and substitute its own discretion except where the discretion has been shown to have been exercised arbitrarily, or capriciously or perversely or where the court had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. An appeal against exercise of discretion is said to be Page 33 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined an appeal on principle. Appellate Court will not reassess the material and seek to reach a conclusion different from the one reached by the court below if the one reached by the court was reasonably possible on the material. The appellate court would normally not be justified in interfering with the exercise of discretion under appeal solely on the ground that if it had considered the matter at the trial stage it would have come to a contrary conclusion. If the discretion has been exercised by the Trial Court reasonably and in a judicial manner the fact that the appellate court would have taken a different view may not justify interference with the trial court's exercise of discretion. After referring to these principles Gajendragadkar, J. in Printers (Mysore) Private Ltd. v. Pothan Joseph: (SCR 721) "...These principles are well established, but as has been observed by Viscount Simon in Charles Osention & Co. v. Johnston ....the law as to the reversal by a court of appeal of an order made by a judge below in the exercise of his discretion is well established, and any difficulty that arises is Page 34 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined due only to the application of well settled principles in an individual case."
The appellate judgment does not seem to defer to this principle."
8. In view of the above settled principles of law, this Court has very limited power to interfere with the order passed by the learned trial Court and only in exceptional circumstances, the Appellate Court can interfere with the discretionary order passed by the learned trial Court. The Appellate Court cannot reevaluate the entire evidence and arrive at a conclusion contrary to the conclusion arrived at by the learned trial Court unless the said order is found to be invalid, illegal, arbitrary, perverse or contrary to the settled principles of law. Keeping in mind the above principles, this Court has only to see as to whether the learned trial Court has committed any error in passing the impugned order. At the same time, this Court is also required to see whether the cardinal principles of law governing the injunction i.e. prima facie case, balance of Page 35 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined convenience and irreparable loss are satisfied or not in passing the order or not ?
9. From the record and submissions of the learned advocates for the respective parties, the case of the plaintiff mainly based on the sale deed executed between the appellants - original plaintiffs and respondents with specified consideration mentioned in the sale deed for the portion of land from FP-1 Odhav, TP Scheme. It appears that that the sale deed contains a stipulation to the effect that all the cheques of the total sale consideration of Rs.17,45,45,000/- are handed over to the appellants by the respondents. It also appears that the possession of the suit land is handed over to the respondents herein and the appellants have undertaken to indemnify the respondents for any loss or damage on account of any litigation or dispute, etc. in respect of the suit land. It is pertinent to note that the sale deed came to be executed on 12.4.2016 and for a long period of about 6 years, the appellants/plaintiffs never demanded the outstanding sale Page 36 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined consideration only on account of the understanding reached between the parties. It is the contention of learned senior advocate Mr.Sanjanwala that a number of litigations are contested jointly by the appellants and the respondents herein before the various forums including this Court as well as the Hon'ble Supreme Court in respect of the suit lands under the Tenancy Act initiated at the instance of the original owners of the said lands and in none of the proceedings, the appellants had never contended that such an amount of consideration is due and payable. It also appears that in the year 2021, as the parties wanted to develop the suit lands, a requisite application was moved by the parties before the Ahmedabad Municipal Corporation for sanction of such development and sub-division of the suit lands and the same was opposed by one of the heirs of the tenants and a detailed hearing took place before the Assistant Municipal Commissioner (East Zone), AMC and the said authority by an order dated 31.8.2021 overruled such objections and forwarded the said request of sub- division to the concerned department of the AMC and in the Page 37 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined course of hearing of the said objections also, the appellants never raised any grievance with regard to the so-called unpaid sale consideration and on 02.10.2021, the AMC has granted the development permission in respect of the said land and pursuant to such permission, the respondents started developing the suit land and substantially carried out the same and thereafter applied for requisite permission under RERA Act in respect of the project proposed by the respondents viz. Rashmi Growth Hub. It appears that on 21.5.2022, the appellants submitted written objections before the RERA Authority to the issuance of such certificate in favour of the respondents herein raising a ground that the respondent-firm has not paid the balance sale consideration to the appellants/plaintiffs but the sale deed clearly stipulates that all the cheques have been handed over to the appellants. It appears that the RERA Authority after considering the explanation/reply given by the respondents herein granted such permission.
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10. In the facts and circumstances of the case, the learned trial Court has prima facie appreciated all the evidence in its proper perspective and all the ingredients of prima facie case, balance of convenience and irreparable loss have been considered in detail. Therefore, in the considered opinion of this Court the impugned order passed by the learned trial Court is found to be just and proper and no illegality or perversity is committed by the learned trial Court while passing the impugned order. It is pertinent to note that Section 144 of CPC would not be applicable to the facts of the present case as the main suit is pending for adjudication before the learned trial Court. The principle of doctrine of restitution is that on the reversal of a decree, the law imposes an obligation on the party to the suit who received the benefit of the decree to make restitution to the other party for what he has lost. In the present case, the final decree is yet to be passed as the main suit itself is pending for adjudication before the learned trial Court.
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11. Under the circumstances, the present Appeal from Order fails and the same is hereby dismissed. The order dated 23.3.2023 passed below Exhs.5 and 27 in Special Civil Suit No.449 of 2022 by the learned Additional Senior Civil Judge, Ahmedabad (Rural) is hereby confirmed.
12. Appeal from Order No.122 of 2023 stands allowed. The portion i.e. paragraph No.8.5 and final paragraph No.2 of the impugned order dated 23.3.2023 passed below Exhs.5 and 27 in Special Civil Suit No.449 of 2022 by the learned Additional Senior Civil Judge, Ahmedabad (Rural) is hereby quashed and set aside.
13. While parting with the order, it is clarified that this Court has examined the impugned order passed by the learned trial Judge within the limited scope of Order 43, Rule 1(r) of the Code of Civil Procedure whereas the main controversy involved in the suit is at large before the trial Court to be adjudicated through full fledged trial. Therefore, the learned trial Judge shall not be influenced by any Page 40 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023 NEUTRAL CITATION C/AO/91/2023 ORDER DATED: 25/09/2023 undefined observations recorded by this Court herein above while deciding the suit at the end of trial. The findings recorded by this Court are tentative in nature and the learned trial Judge shall decide the case on merits as per the evidence led by the parties during the course of trial and decide the suit in accordance with law.
14. In view of the above, the Civil Applications do not survive and the same stands disposed of accordingly.
At this stage, learned advocate Mr.Bhargav Bhatt prays for stay of this order for a period of six weeks. The said request for stay of this order is opposed by learned advocate Mr.Sunil Joshi appearing for the respondent Nos.2 and 2.1. Considering the facts of the present case, the request made by learned advocate Mr.Bhargav Bhatt for stay of this order is rejected.
(S. V. PINTO,J) H.M. PATHAN Page 41 of 41 Downloaded on : Tue Sep 26 20:45:20 IST 2023