* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CS(OS) NO.319/2008
Date of Decision : 04.07.2011
PRAKASH KHATTAR ...... Plaintiff
Through: Mr.Rakesh Tiku, Sr.Adv.
with Mr.Prakash
Gautam, Adv.
Versus
SMT. SHANTA JINDAL & ORS. ...... Defendants
Through: Mr. Ved Prakash Sharma
and Ms. Amrit Kaur,
Advs.
CORAM :
HON'BLE MR. JUSTICE V.K. SHALI
1. Whether Reporters of local papers may be
allowed to see the judgment? YES
2. To be referred to the Reporter or not ? YES
3. Whether the judgment should be reported
in the Digest ? YES
V.K. SHALI, J.
IA No. 2156/2008 (U/O 39, Rule 1 & 2) & IA No.10200/2009 (u/O 39 Rule 4 CPC)
1. This order shall dispose of an application bearing IA No.2156/2008 under Order XXXIX Rules 1 and 2 CPC and CS(OS) no.319/2008 Page 1 of 31 an IA bearing no.10200/2009 u/O 39 Rule 4 CPC filed by the defendants for vacation of the ex parte ad interim stay granted on 18.2.2008.
2. Brief facts of the case are that the plaintiff has filed the present suit for specific performance against the defendant nos.1 to 5 in respect of an agreement to sell dated 16.4.2005. It is alleged in the plaint that the defendant nos. 1 to 5 are the legal heirs of one Sh.B.C.Mittal who had a perpetual sub-lease in respect of a plot of land measuring 190 sq. yds. bearing no.B-154, Shivalik Colony, Malviya Nagar, New Delhi in his favour.
3. Mr.B.C.Mittal, had expired on 31.5.99 and as a consequence of this, the defendant nos.1,2 and 5 being the daughters and the defendant nos.3 and 4 being the sons had inherited the estate of the said deceased. They had entered into an agreement to sell the aforesaid property in favour of the plaintiff vide agreement to sell dated 16.4.2005 for a total sale consideration of `1,35,00,000/-, out of which an amount of ` 15 lacs was paid by way of 5 pay orders dated 18.4.2005 drawn in favour of each of the CS(OS) no.319/2008 Page 2 of 31 five defendants for which they had issued necessary receipt. It is further alleged that a sum of `25,00,000/- was also paid to them in cash which was duly acknowledged by them. Thus, out of the total sum of `1,35,00,000/-, an amount of ` 40 lacs is alleged to have been paid to the defendants and the balance amount of ` 95,00,000/- was to be paid to the defendants at the time of execution of the sale deed in respect of the suit property which was to be done within 60 days from the date of conversion of the suit property from leasehold to freehold. It is also alleged that the agreement envisaged that in the event of the property being not converted into freehold for any reason, the said amount would be paid to the defendants within 60 days from the date of the execution of the receipt dated 18.4.2005 provided the defendants execute the other related documents like, General Power of Attorney, Special Power of Attorney, receipt coupled with the transfer of possession in respect of the suit property.
4. It is alleged by the plaintiff that on his asking, the defendants had applied to the L&DO for conversion of the CS(OS) no.319/2008 Page 3 of 31 leasehold rights in respect of the suit property into freehold which was being followed by the plaintiff. However, during this course, the plaintiff learnt that the conversion could not take place as certain deficiencies were pointed out by the L&DO. These deficiencies were that the share certificate and the NOC from the concerned society was not obtained and filed with the L&DO.
5. It has also been alleged by the plaintiff that it was learnt that actually Mr.B.C.Mittal, deceased had made only Mr.Vijay Mittal, defendant no.4 as the sole nominee of the suit property. Further, the original share certificate was not traceable, therefore, duplicate share certificate was required to be obtained by the defendants in the name of all the five defendants, who are purported to have executed the agreement to sell. It is alleged that the defendants had also lodged a report with the SHO P.S. Malviya Nagar on 29.8.2005 stating that they had lost the original share certificate. The plaintiff further states that from April, 2005 till the end of August, 2006, nothing happened and from September, 2006 for about one year, meetings took CS(OS) no.319/2008 Page 4 of 31 place between the plaintiff and the defendants to resolve the matter so that the transaction could be wound up but it also did not bring any fruitful result.
6. It is stated that further meetings took place in September, 2007 which did not bring any resolution as in the meantime, on account of considerable increase in the prices of real estate, the defendants turned dishonest and tried to wriggle out of the transaction compelling the plaintiff to file the present suit for specific performance in respect of the suit property and alternatively claiming a recovery of `1,35,00,000/- against the defendants along with an interest @18% being the sale price of the suit property. Along with the suit the plaintiff had filed the abovementioned IA under Order XXXIX Rule 1 and 2 CPC for allowing an ex-parte ad interim injunction.
7. On 18.2.2008, the defendants were restrained by way of an ex parte ad interim order from parting with the possession of the suit property or in any manner creating any third party interest.
CS(OS) no.319/2008 Page 5 of 31
8. The defendants filed their common written statement and the reply to the application under Order 39 Rules 1 and 2 CPC and did not dispute the execution of the agreement dated 16.4.2005 by the defendant no.1 for himself and by defendant no.2 for his own self as well as defendant nos.3 to 5. However, it was the stand of the defendants that as the said document dated 16.4.2005 was neither properly stamped nor duly registered, therefore, the same was inadmissible in law and could not be relied upon. It is further contended that even if the said document is taken into consideration, it would clearly show that according to clauses 5,6 & 7 time was the essence of the contract. The first party, namely the defendants at the instance of the second party that is the plaintiff was to apply to the L&DO for conversion of the leasehold rights to freehold and the entire charges of conversion and the responsibility of getting the property converted into freehold rested with the plaintiff. It is alleged that the plaintiff failed to discharge his obligation in a reasonable and efficient manner as a consequence of which, the property could not be converted CS(OS) no.319/2008 Page 6 of 31 from leasehold to freehold within the stipulated period as envisaged under the agreement.
9. It has also been stated that the plea of the plaintiff that the defendants have misplaced the original share certificate and consequently, conversion of the suit property to freehold could not be done, is only a ploy to come out of the transaction by the plaintiff. It is stated that the plaintiff did not have requisite funds available with him. It is stated that the defendants had obtained a duplicate copy of the share certificate in the year 2006 that is a reasonable time given to the plaintiff. In any case, it is contended by the defendants that the agreement which was signed between the parties clearly envisaged that in the event of the property not being converted into freehold within 60 days, the plaintiff was still to make the balance payment of `95,00,000/- to the defendants and the defendants were liable to execute the documents like power of attorney, agreement to sell, Will and transfer the possession of the suit property in favour of the plaintiff. It is stated that the CS(OS) no.319/2008 Page 7 of 31 defendants have approached the plaintiff for making the balance payment of ` 95 lacs in terms of the said clause of the agreement so that the transaction could be completed but the plaintiff for the reasons best known to him neither got the said documents executed nor did he make the requisite payment of `95,00,000/- in favour of the defendants. It is stated by them that time being the essence of the contract and the plaintiff having failed to make the balance payment of `95,00,000/- to the defendants, the defendants had forfeited the said amount of `40 lacs given to them as an advance at the time of signing of the agreement. It is also alleged by the defendants that the plaintiff has not come to the Court with clean hands and as a matter of fact, he is a speculator, inasmuch as they were approached by one Rajinder claiming himself to be the real estate agent operating in Malviya Nagar, Delhi sometime in December, 2007/ January, 2008 and he claimed that he has purchased the rights of the plaintiff under the agreement dated 16.04.2005 from the plaintiff, and accordingly, he CS(OS) no.319/2008 Page 8 of 31 wanted to complete the transaction even though it entails the payment of certain escalating charges to the defendants on account of increase in the prices of land as claimed by the defendant. It is further alleged to have been stated by the said gentleman that the plaintiff had suffered huge losses in his business of running a show room in electronic goods and therefore, was not in a position to go ahead with the transaction. Thus, the defendants have submitted that there was no prima facie case in favour of the plaintiff warranting the continuance of the ex parte ad interim stay granted to them on 18.2.2008.
10. The plaintiff filed his replication and controverted the averments made in the written statement and reiterated the averments made in the plaint.
11. From the respective pleadings of the parties, the following facts emerge:
(i) It is not in dispute that on 16.4.2005, an agreement to sell was executed between the defendants as the first party and the plaintiff as the second party. CS(OS) no.319/2008 Page 9 of 31
(ii) The defendants had admittedly received a sum of ` 40 lacs out of which a sum of ` 15 lacs was received by way of five pay orders of `3 lacs each in the name of the five defendants and the balance payment of ` 25 lacs was received by way of cash.
(iii) The property being a leasehold property was to be converted into freehold and for this purpose, the defendants had executed the necessary documents like indemnity bonds etc. and applied to L&DO and the plaintiff was to take up the matter for conversion of the leasehold rights into freehold in favour of the defendants and pay the necessary conversion charges. It was the responsibility of the plaintiff to ensure that the conversion of the leasehold rights takes place within 60 days from the date of execution of the receipt cum agreement dated 16.4.2005. The sale deed was to be executed within that period and the balance sale consideration was to be paid.
(iv) In the event of the leasehold rights not being converted into freehold within the stipulated period of CS(OS) no.319/2008 Page 10 of 31 60 days still the payment of ` 95 lacs was to be made by the plaintiff to the defendants within the period of 60 days and the defendants were under an obligation to execute the necessary documents like agreement to sell, receipt, Will, Power of Attorney, etc. coupled with the transfer of possession of the suit property in favour of the plaintiff.
12. It is the case of the plaintiff that the defendants have defaulted in carrying out their obligation in terms of the agreement for want of original share certificate and the nomination of defendant no.4 in the records of the society created problems as the conversion could not be carried out. It is also the case of the plaintiff that the property prices having escalated, the defendants on being approached on different dates engaged the plaintiff in futile talks which ultimately did not yield any result. This compelled the plaintiff to file the present suit for specific performance in which this Court had issued an ex parte ad interim stay on the very first date i.e. 18.2.2008. CS(OS) no.319/2008 Page 11 of 31
13. As against this, the defendant has taken the plea that the plaintiff did not discharge his obligation within the stipulated period of 60 days from the date of signing of agreement to sell. It is urged that the time was the essence of the contract and in the absence of the property being converted into freehold, the plaintiff could not absolve himself from making the balance payment of ` 95 lacs to the defendant as it was envisaged in the agreement itself that in the event of conversion not being carried out by the L&DO, the plaintiff had to make the balance payment of `95 lacs and perfect his title by obtaining the possession and getting all other requisite documents like agreement to sell, Power of Attorney, receipt, etc. executed in his favour.
14. In the light of the aforesaid factual matrix, the question which arises for consideration is as to whether the time was the essence of the contract or not and if the time was the essence of the contract, whether the plaintiff had defaulted in performing his part of the obligation in terms of such time frame stipulated in the agreement. For this purpose, clauses 3, 4, 5, 6 and 8 of the agreement dated CS(OS) no.319/2008 Page 12 of 31 16.4.2005 become important. The said relevant clauses 3,4,5,6 and 8 read as under:-
3) That the second party has seen and satisfied himself with regard to title deeds existing in favour of Late Shri B.C.Mittal and has also seen and satisfied himself with regard to mutation, carried out by MCD. Affidavit, Indemnity Bond that the first party has executed for effecting mutation of the property in their favour in the office of Land and Development, New Delhi. At the request of the second party, the first party will also apply in the office of Land and Development along with the mutation, for conversion of lease hold rights into the freehold rights. The Second party has agreed to pay the conversion charges as may be applicable in terms of policy, guidelines and rules framed by Land and Development office and get mutation and conversion done at his expense from the Land and Development office. The party of the First party shall cooperate and provide any document that may be required by the Second party for the purpose of mutation in the office of Land and Development and also for the purpose of effecting conversion from lease hold to freehold."
"4) That the First party has assured the Second Party that the property does not suffer from any defect of title.
5) That it is agreed that the Second party shall pay to the First party the balance sale consideration within 60 days from the execution of this receipt cum Agreement and the First party shall execute the sale deed in favour of the Second party simultaneously.CS(OS) no.319/2008 Page 13 of 31
6) That the Second party has further agreed that in the event of mutation and/or conversion from leasehold to freehold for any reason not being sanctioned/carried out by the Land & Development Office within the stipulated period of 60 days as aforesaid, in that event the Second party shall pay to the First party the balance sale consideration of ` 95,00,000/- (Rupees Ninety Five Lakhs) within the said stipulated period of 60 days from the date of this agreement and the First party shall execute in favour of the Second party a registered Agreement to Sell and attendant documents such as General Power of Attorney, Receipt, Will in respect of the property and affidavit of delivery of possession and shall also deliver actual, vacant and physical possession of the property to the Second party simultaneously.
8) That the Second party agrees that in the event of his failing to pay the balance sale consideration and complete the sale transaction, as stipulated in clause 5 and 6 above, within 60 days from the date of execution of this receipt cum agreement, the advance earnest money paid to the First party by way of this agreement shall stand forfeited. The Second party has entered this Agreement for buying the said property and if the First party fails to complete this agreement, the Second party will enforce the specific performance of this agreement."CS(OS) no.319/2008 Page 14 of 31
15. I have heard Mr. Rakesh Tiku, learned senior counsel for the plaintiff and Mr. Ved Prakash Sharma, learned counsel for the defendants.
16. It was contended by Mr. Tiku, learned senior counsel on behalf of the plaintiff that at the outset, the ex parte ad interim stay was granted on 18.02.2008 in favour of the plaintiff and since the case is at the stage of recording of evidence, therefore, it will be just and proper in case the stay which is granted in favour of the plaintiff, is confirmed till the disposal of the suit as it would otherwise cause serious prejudice to the plaintiff.
17. Secondly, it was contended by the learned senior counsel that even on merits, a perusal of the agreement would show that the defendants had to apply to the L&DO for conversion of leasehold rights into freehold and the sale deed was to be executed within a period of 60 days from 16.04.2005 when the part payment amounting to Rs. 40 lakhs was made to the defendants. It is contended that no doubt under the terms and conditions of the agreement, CS(OS) no.319/2008 Page 15 of 31 the defendants had applied but that application could not be considered to be a valid application because it was pointed out by the L&DO that there were deficiencies as it did not have the share certificate and no objection certificate of the society. It was stated that the plaintiff in terms of the obligation deposited the necessary charges and was following up the same with the said department. It was contended by Mr. Tiku, that these deficiencies were essentially two-fold. Firstly, the original share certificate was not filed by the defendants and they had subsequently on 03.12.2005 lodged a report with the police and till the time the duplicate certificate was issued by the society, the necessary conversion could not have taken place. Secondly, it was stated that the conversion could not be carried out by the L&DO on account of the fact that the records of the society showed that late Shri B.C. Mittal, the father of the defendants had made defendant no. 4 as the sole nominee and, therefore, the record of the society had to be got corrected in this regard because the sale of the suit property was being effected by all the five defendants. CS(OS) no.319/2008 Page 16 of 31 It is contended that on account of these deficiencies, the plaintiff could not obtain conversion of leasehold rights to freehold and consequently the occasion for the plaintiff to pay the balance amount of sale consideration to the defendants did not arise as the time in itself ceased to be the essence of the contract.
18. So far as the second condition in clause 6 of the agreement is concerned, which envisaged that in the event of the conversion not taking place within a period of 60 days from the date of execution of the agreement, i.e., 16.04.2005, the plaintiff was still under an obligation to pay the balance sale consideration within a period of 60 days from the said date of execution of the agreement and the defendants were under an obligation to execute the necessary documents in favour of the plaintiff, this eventuality did not come into operation as the defendants did not have original share certificate and also did not get the issue of nominee sorted out. It was further contended that although originally the defendants were willing to CS(OS) no.319/2008 Page 17 of 31 execute the document and transfer the possession of the suit property but later on they backed out and consequently the plaintiff could not be blamed for not completing the transaction within a period of 60 days. It is further contended by Mr.Tiku that the defendants deliberately kept the plaintiff engaged in futile talks and in the meantime, as the prices of the immovable property had escalated beyond expectations, the defendants tried to wriggle out of the agreement.
19. On the basis of the aforesaid submissions, it was contended by the learned senior counsel that the plaintiff has got a prima facie good case and that the balance of convenience is also in favour of the plaintiff and that the plaintiff will suffer an irreparable loss in case the ex parte ad interim injunction granted on 18.02.2008 is not confirmed during the pendency of the suit.
20. As against this, Mr. Sharma, learned counsel for the defendants has contended that the plaintiff prima facie has not come to the Court with clean hands and any person CS(OS) no.319/2008 Page 18 of 31 who does not come to the Court with clean hands is not entitled to get the discretionary relief of specific performance much less the ad interim relief of injunction under Order 39 Rule 1 and 2 CPC. The question of the plaintiff having not come to the Court with clean hands is sought to be shown by the learned counsel for the defendants by urging that clauses 6 to 8 of the agreement which form the backbone of the entire agreement would show that the time was the essence of the contract which was fixed as 60 days from the date of the execution of the agreement, irrespective of the fact that whether the conversion of the leasehold rights into freehold has been done by the L&DO or not, the transaction ought to have been completed within a period of 60 days. As against this, the plaintiff knowing fully well that the lessor, namely, L&DO had failed to complete the process of conversion of leasehold rights into freehold within a stipulated period of 60 days, still did not pay the balance amount of Rs. 95 lakhs to the defendants and neither took the possession of the suit property. This clearly shows that the plaintiff did CS(OS) no.319/2008 Page 19 of 31 not have sufficient finance and he was only speculating in the property by blocking the sale/disposal of the suit property.
21. It has also been contended by the learned counsel for the defendants that the defendants have specifically stated in para 8 of the preliminary objections that they were approached by one Rajinder, a property dealer, who had purportedly purchased the rights under the agreement dated 16.04.2005 from the plaintiff and that he was even prepared to pay a reasonable escalation in the price of the suit property to the defendants and this fact has not been disputed by the plaintiff in the replication. This clearly show that the plaintiff did not possess sufficient means or funds to complete the transaction and also defaulted in paying the balance amount of sale consideration amounting to Rs. 95 lakhs within a period of 60 days from the date of the execution of the agreement de hors as to whether the conversion was carried out by the L&DO or not.
CS(OS) no.319/2008 Page 20 of 31
22. So far as the conversion of the suit property from leasehold to freehold is concerned, it is contended by Mr. Sharma that conversion of the property from leasehold to freehold was essentially the responsibility of the plaintiff and the defendants had already given all necessary documents duly completed along with their affidavits to the plaintiff himself for the purpose of filing the same to the L&DO. The plaintiff has failed to complete the transaction in terms of the agreement and accordingly the defendants were constrained to forfeit the entire amount paid to them by the plaintiff on account of having not come forward to perfect his title.
23. Learned counsel for the defendants has also relied upon the following judgments :-
(i) Abdul Hamid & Anr. Vs. Nur Mohammad AIR 1976
Delhi 328
(ii) UOI Vs. M/s Jashan Mul & Co. Fruit and
Vegetable Merchanta, Subzimandi, Delhi AIR 1976 Delhi 335
(iii) K.L.Sethi Vs. S.Kishan Singh 159 (2009) DLT 464
(iv) Parwati Devi & Ors. Vs. DDA 159 (2009) DLT 467
(v) Sanjeev Narang Vs. Prism Buildcon Pvt. Ltd. 154 (2008) DLT 508 (DB) CS(OS) no.319/2008 Page 21 of 31
(vi) Durga Periwal Vs. Punjab National Bank & Ors.
154(2008) DLT 514 (DB)
(vii) Man Kaur (Dead) by LRs. Vs. Hartar Singh Sangha (2010) 10 SCC 512
(viii) Vallayati Ram Mittal Pvt. Ltd. Vs. UOI & Anr.
(2010) 10 SCC 532
24. I have carefully considered the respective submissions of the parties and gone through the record.
25. The first question to be considered is as to whether the time was the essence of the contract or not, because that factor is very important and crucial so far as the execution of the documents in pursuance of the agreement in question is concerned.
26. A bare perusal of the clauses 5, 6 and 8 of the agreement, the contents of which are reproduced hereinbefore, clearly shows that it was intended between the plaintiff and the defendants that time would be the essence of the agreement. This time was only two months, i.e., 60 days from the date of the execution of the agreement which is also not in dispute. The date of execution of the agreement is 16.04.2005. Admittedly, the plaintiff has paid a sum of CS(OS) no.319/2008 Page 22 of 31 Rs. 40 lakhs which has not been disputed by the defendants but in terms of the agreement and the aforesaid clauses, the entire transaction had to be completed within a period of 60 days from the date of the signing of the agreement. The case of the plaintiff is that the defendants could not get the property converted from leasehold to freehold within the said stipulated period of 60 days. Even if it is assumed that the defendants were not able to get the suit property converted from leasehold to freehold within a period of 60 days as envisaged, time was the essence of the contract as it was envisaged in the next clause categorically that in the event of conversion not taking place within a period of 60 days, the plaintiff was still under an obligation to pay the balance sale consideration of Rs. 95 lakhs and get necessary documents executed from the defendants including the transfer of possession of the suit property. The plaintiff cannot be permitted to rely on clause (5) of the agreement for conversion of leasehold rights into freehold and then contend as the same was not done on account of certain deficiencies, the other portion of CS(OS) no.319/2008 Page 23 of 31 the agreement which envisage that the transaction had to be completed within a period of 60 days from the date of signing of the agreement, does not come into operation.
27. I feel that even if it is assumed that for reasons justified or unjustified, attributable to the defendants or not, the L&DO either intentionally or unintentionally did not complete the process of conversion of leasehold rights into freehold, still the balance payment of Rs. 95 lakhs had to be necessarily made to the defendants and the defendants were under an obligation to have transferred the possession and necessary documents to the plaintiff. This was not done by the plaintiff. On the contrary, the plaintiff kept on sleeping over the matter for almost three years till the month of February/March 2008 when he filed the present suit for specific performance and alternatively claimed the damages to the tune of Rs. 1.30 crores. This delay of nearly three years is sought to be explained by the plaintiff by contending that he had approached the defendant in the year 2006, 2007 and even in 2008 and as CS(OS) no.319/2008 Page 24 of 31 the defendants were not trying to work out a solution to the problem, therefore, he was left with no other alternative but to file the suit for specific performance. The plaintiff is stated to be a property broker by the defendants in the written statement. This fact is not denied by the plaintiff. They have disputed the financial capacity of the plaintiff to be able to complete the sale transaction. The defendants have also stated in the written statement that they were approached by a gentleman by the name of Rajinder in the month of December, 2007/January, 2008 who represented to them that he had purchased the rights of the plaintiff under the agreement dated 16.04.2005 and he was prepared to go ahead with the transaction of purchase of the suit property even though it entails the payment of certain escalation charges on account of an increase in the land rates. The replication filed by the plaintiff to this averment of the defendants is curiously enough, silent which clearly makes the Court to assume prima facie that an averment which is made in the pleadings and has gone un-rebutted, is deemed to have been admitted by the CS(OS) no.319/2008 Page 25 of 31 plaintiff. Therefore, this clearly shows that even at the time when the agreement was entered into, the plaintiff was not in possession of sufficient means to go ahead with the transaction although this is my prima facie view but the plaintiff can always dislodge this fact by producing evidence during the course of trial. But this is certainly a factor to be taken into consideration coupled with the delay in coming to the Court at the fag end of the limitation so far as the prima facie case is concerned.
28. Mr. Tiku, learned senior counsel for the plaintiff has stated that there are judgments of the Apex Court to the effect that the financial capacity of the plaintiff for completing the transaction has to be seen during the course of trial and it is not necessary that the party who is seeking relief of specific performance must be in possession of liquid cash so as to complete the transaction. I agree with this submission of the learned senior counsel for the plaintiff but nevertheless at the same time, one cannot ignore the fact that the plaintiff kept sleeping over the matter for a CS(OS) no.319/2008 Page 26 of 31 period of about three years and choose file the matter towards fag end of the three years of the limitation which clearly indicates that he did not prima facie have the funds available with him so as to make the balance payment of Rs. 95 lakhs which was being repeatedly claimed by the defendants.
29. The question that it is only during the course of the trial that the plaintiff will be required to show to the Court that he had sufficient means, in my opinion, has to be decided in the facts of the present case where there are specific allegations that the plaintiff being a speculator/property broker was not in possession of sufficient funds so as to go ahead with the transaction. This clearly, in my view, shows that the plaintiff does not have any prima facie case. The balance of convenience also cannot be said to be in favour of the plaintiff inasmuch as the property rates are sky-rocketing and there is no point in keeping the property of the defendants blocked under litigation on the assumption that the plaintiff will adduce evidence to prove CS(OS) no.319/2008 Page 27 of 31 his case as well as sufficiency of funds to make the payment. I, therefore, feel that both the question of prima facie case as well as the balance of convenience not being in favour of the plaintiff, the whole thing must be against the plaintiff for the aforesaid reasons.
30. The last part which the plaintiff has to satisfy is that the plaintiff will suffer an irreparable loss. I do not feel that if the order of injunction is vacated, the plaintiff will suffer an irreparable loss. Section 52 of the Transfer of Property Act deals with the doctrine of lis pendens as has been discussed above clearly lays down that any property which is subject matter of a suit or a litigation, cannot be permitted to be transacted without the permission of the Court and would be transacted subject to the outcome of the decision in the matter. This fact is also reiterated by the Division Bench of our own High Court in case titled Sanjeev Narang Vs. Prism Buildcon Pvt. Ltd. 154(2008) DLT 508 (DB), where it has been observed as under:-
"11. We are conscious of the fact that under Section 52 of the Transfer of Property Act, 1882, CS(OS) no.319/2008 Page 28 of 31 in case of pending suit in which right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein except under the authority of the Court and on such terms as it may impose. Therefore, in order to strike a balance between the parties, the respondent is directed to inform the purchaser about the litigation pending between the parties in case the respondent wishes to dispose of the property during the pendency of the suit so that innocent purchaser may be aware about the pending litigation of the parties.
12. In view of the above, we are left with no option but to affirm the order passed by the learned Single Judge vacating the interim injunction.
13. We make it clear that any observation made herein shall be treated as tentative in nature and shall not constitute any expression of final opinion on the issues involved in Appellant's suit and shall have no bearing on the final merit of case and submissions of the parties in the suit."
31. The argument of the learned senior counsel is that since the case is at the stage of recording of evidence, therefore, he may be permitted to prove sufficiency of funds during the course of trial. No doubt, there are judgments of the CS(OS) no.319/2008 Page 29 of 31 Apex Court that a person need not have liquid cash available with him all the time or till the time of filing of the suit as this is a question to be decided on merits, nevertheless, the facts of the case are such which clearly show that prima facie there is no document on record to show that after having paid a sum of Rs. 40 lakhs to the defendants, the plaintiff had ever offered to pay the balance amount of Rs. 95 lakhs in terms of the Clause 6 of the agreement to complete the transaction and that he possessed sufficient liquidity to that extent.
32. Therefore, in all the three parameters, I feel that the plaintiff has not been able to make out a prima facie case in his favour. The balance of convenience is also not in favour of the plaintiff and that the plaintiff will not suffer an irreparable loss in case the ex parte ad interim injunction granted on 18.02.2008 is vacated. I am not impressed by the argument that merely because the ex parte ad interim injunction granted on 18.02.2008 has CS(OS) no.319/2008 Page 30 of 31 continued for almost three years, as a matter of course and automatically the injunction deserves to be confirmed.
33. For the abovementioned reasons, I am of the considered opinion that the injunction granted on 18.02.2008 deserves to be vacated. The application bearing IA no.2156/2008 under Order 39 Rules 1 & 2 CPC is accordingly dismissed and the corresponding application bearing IA No.10200/2009 under Order 39 Rule 4 CPC stands allowed.
34. It is hereby made clear that expression of any opinion hereinbefore shall not be deemed to be an expression on the merits of the case.
V.K. SHALI, J.
July 04, 2011 RN/MA CS(OS) no.319/2008 Page 31 of 31