Bombay High Court
33 vs Mahadeo Bandu Sonawane on 18 November, 2011
Bench: R. M. Borde
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IN THE HIGH COURT OF JUDICATURE OF BOMBAY
CIVIL APPELLATE JURISDICTION.
Appeal from Order No. 1117 of 2011
WITH
Civil Application No.1490 of 2011 in AO No. 1117 of 2011
M/s. Buildtech Engineers
33, Jai Jawan Co-op. Hsg. Soc.,
Sector 17, Vashi, New Mumbai. ....Appellant
v/s.
Mahadeo Bandu Sonawane
2. Shalini Shivling Jawle
3A. Smt. Suman Madhav Ayare
3B. Shri Hemant Madhav Ayare
3C. Shri Sharad Madhav Ayare
3D. Smt. Phularani Madhav Ayare
r/at: Room No.1, Sahakar Chawl. D'Melo Compound,
Vakola Bridge, Santacruz (E), Mumbai 500 055.
3E. Smt. Pushpa Gautam Gavli
r/at: B/12, Tetachers Staff Quarters,
Bombay University, Vidyanagri,
Kalina Santacuz, Mumbai 400 098.
4. Kisan Jiwanrao Jadhav
5. Smt. Subhadrabai Krishnath Sonawane
6. Smt. Malanbai Rambhau Khatik
7. Laxman Dhondiba Gade
8A. Mr. Narendra Shobha Ahire
Having address at 136/4582
Nehru Nagar, Kurla (E), Mumbai.
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9. Goraknath Baburao Kamble
10. Ganesh Yadav Kalkhair
11. Vaijnath Nagoji Jagatkar
12. Laxman Nathu Londe
13A. Smt. Arabai Bhaurao Borade
13B. Sunil Bhaurao Borade
13C. Mr. Suresh Bhaurao Borade
13D. Vimal Ashok Borade
all of them r/at Flat No. 504,
Building No. 84, Nehru Nagar
13E. Nanda Raju Kharde
r/at Room No. 103, 1st floor,
B-Wing, L-12, Pratiksha Nagar,
MHADA Vasahat Vignahart Society,
Sion, Mumbai.
14. Smt. Shesharabai Parshuram Waghmare
15A. Ashok Rajaram Borade
15B. Mr. Gautam Rajaram Borade
15C. Mr. Bhagwan Rajaram Borade
r/at: 6/14, Soniya Colony,
Khadegolvari, Vitthalwadi(E),
Dist. Thane.
16. Smt.Kanta Dashrath Kamble
17. Mrs. Jalsabai Gulab Gaikwad
18. Sopan Chatrabhuj Gaikwad
19. Vishwanath Rupaji Vadmare
all of them claiming to be members of Harijan
Marathwada Vijay Co-operative Housing Society
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Ltd.
Near Lal Dongar, Sion-Trombay Road,
Chembur, Mumbai 400 071. ....Respondents-
Orig. Defendants
Mr. Vijay Thorat with Ravi Kadam i/b. S.S. Pandey for the appellant.
Mr. Pravin Samdhani i/b. Mamta Sharma for respondents 5-7.
Mr. Sanjay Jain i/b. C.P. Mishra for respondents 15(c) and 16.
Mr. Narendra Walavalkar, Sr. Counsel i/b. Lalit V. Jain for respondents 18 and
19.
CORAM: R.M. BORDE, J.
18th November, 2011
JUDGMENT:
This Appeal from Order is presented by the original plaintiff taking
exception to the order passed in Notice of Motion No. 1328/2007 decided by
the Judge, City Civil Court, Greater Mumbai on 17th September, 2011. The
plaintiff has presented Notice of Motion claiming an order of temporary
injunction restraining the defendants, their agents, servants or their officers
from dispossessing the plaintiff from the suit property i.e. an area of 14918.50
sq. ft. together with available FSI of 17080 sq. ft. on City Survey No. 342/1 to
82 for construction of building KAVERI situated at Little Malbar Hill, Sion-
Trombay Road, Near Poonam Petrol Pump, Chembur, Mumbai without
following due process of law on the grounds set out in the plaint.
The plaintiff in the plaint has made following substantial prayers:-
" (a) That it be declared that the Suit Agreement
executed between the plaintiff and the defendants on 1st
October, 2003 and the second suit agreement between
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plaintiff and defendant no. 18 and 19, on 25th June, 2004
vis-a-vis a suit property i.e. Area admeasuring 14918.50 sq.
ft. together with the available FSI of 17080 sq. ft. on C.T.S.
No. 342/1 to 82 for construction work of building Kaveri
situated at Little Malbar Hill, Sion-Trombay Road, Near
Poonam Petrol Pump, Chembur, Mumbai 400 071 is still
legal, valid, subsisting and enforceable;
(b) That the Defendants their servants, their
agents, their officers and their constituents be restrained by
an order of permanent injunction from dispossessing the
plaintiffs from the suit property i.e. Area admeasuring
14918.50 sq. ft. together with the available FSI of 17080 sq.
ft. on C.T.S. No. 342/1 to 82 for construction work of
building Kaveri situated at Little Malbar Hill, Sion-
Trombay Road, Near Poonam Petrol Pump, Chembur,
Mumbai 400 071, without following due process of law;"
2. According to the plaintiff by a letter of allotment dated 23rd December,
1960, Government has allotted a plot of land having an area of 72 ½ gunthas
at Chembur to M/s. Harijan Vijay Co-operative Housing Society Ltd. Due to
some dispute between the members of Harijan Vijay Co-operative Hsg. Society
and defendants herein, the defendants presented a writ petition bearing No.
3400/2002 in the High Court which was ultimately disposed of in view of the
consent terms placed on record on 22nd October, 2002. As per the consent terms
M/s. Harijan Vijay Co-operative Housing Society agreed to hand over an area
admeasuring 14918.50 sq. ft. together with the available FSI for construction of
building Kaveri to the defendants. It is not disputed that Co-operative Housing
Society has constructed three buildings on the suit property and handed over
flats to the members. The defendants with a view to construct a building for
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the members entered into a development agreement with the plaintiff in respect
of suit property on 1st October, 2003. Pursuant to the said consent terms one
Mrs. Gandhari Soma Jadhav and defendants nos. 18 and 19 were appointed as
promoters and have entered into a separate development agreement with the
plaintiff on 25th June, 2004. Thus, the defendants have entrusted the work of
construction of building to the plaintiff and also handed over the physical
possession of the suit property to the plaintiff. It is submitted by the plaintiff
that by virtue of development agreement the plaintiff is entitled to sale
additional flats to the prospective buyers other than the members of the Society.
The Society is also entitled to utilize and consume FSI and also can purchase
TDR and utilize the same while constructing building on the disputed property.
The plaintiffs states that after taking possession of the property, he has taken
certain steps by carrying out the construction over the property handed over to
him by the defendants such as construction of cabin securing electricity
connection and submission of the plans etc. According to plaintiff by virtue of
the development agreement rights are created in his favour in relation to the
suit property and the plaintiff has right and interest in the property. Despite
this the defendants have attempted to dispossess the plaintiffs from the suit
property. Hence the suit seeking a decree of perpetual injunction and
restraining the defendants from interfering in the possession of the plaintiffs
over the suit property.
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3. The defendants appeared and resisted the suit by filing written-statement.
According to defendants inspite of execution of agreement with the plaintiff in
the year 2003, he has not commenced construction of the building. It is stated
that plaintiff has suppressed material facts from the Court as regards
termination of the agreement and as such he is not entitled to claim equitable
relief from the Court. As the plaintiff did not commence the work of
construction, defendants were constrained to terminate the agreement. The
plaintiff was aware of the termination of agreement, however, he withheld the
material fact from the Court. The plaintiff has not presented suit claiming
specific performance of agreement but has presented the suit claiming
simplicitor injunction. It is contended that the plaintiff is appointed merely a
contractor to develop the property and hand over the constructed portion to the
members of the Society at the prescribed rate. It is specifically contended that
no interest is created in the land and property in favour of the plaintiffs and as
such he is not entitled to claim a prohibitory order of injunction. Thus, it is
prayed that application seeking temporary injunction be rejected.
4. On presentation of the application for injunction, an ad-interim order was
passed in favour of the plaintiff which according to the plaintiff was operative
till the decision of the notice of motion. The interim order passed during the
pendency of the suit was also continued for certain period after disposal of
notice of motion. It is thus contended that the interim order passed by the
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Courts below during the pendency of notice of motion shall be continued until
disposal of the suit.
5. My attention is invited to consent terms arrived at between the parties in
Writ Petition No. 3400/2002 and more particularly para no. 4 of the consent
terms states thus:-
" The petitioner shall construct the Building Kaveri as per
BMC Rules on the land by themselves and comply with all
the terms and conditions of amended layout plan. That the
Committee of three Petitioners being Petitioner No. 1, 3 and
10 will be promoters who will complete the construction
within 2 years of getting the possession of the land and form
a separate Co-operative Housing Society, if permitted by law."
6. It is further provided that the petitioner shall construct the building
KAVERI as per the BMC Rules on the land by themselves and comply with all
the terms and conditions of amended lay out plan. The Committee of the three
petitioners being petitioner (in Writ Petition) nos. 1, 3 and 10 will be promoters
who will complete the construction within three years of getting possession of
the land and form the separate co-operative housing society, if permitted by
law. It is not matter of dispute that 24 petitioners before the High Court in
Writ Petition No. 3400/2002 were erstwhile members of the Harijan Vijay Co-
op. Hsg. Society and separate society is registered in the name and style as
Marathwad Vijay Co-operative Housing Society Ltd. In pursuance to placing
on record the terms of settlement the High Court has disposed of Writ Petition
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No. 3400/2002. Thus as per the terms of settlement, a group of 24 members
was required to construct the building and make allotment of flats amongst
themselves and this exercise was required to be done within a period of two
years from the date of allotment of possession of the land to the petitioners. In
pursuance to the settlement arrived at in the writ petition referred to above, all
the 24 members of the separately formed society in their individual capacity
and collectively alongwith cooperative society entered into an agreement with
the plaintiff on 1st October, 2003. It is stated in Paragraph 6 of the agreement
that an area to the extent of 14.5 gunthas has been allotted to group 'B'
members in pursuance to the settlement for development purpose. The
members of group 'B' decided to construct 30 flats for 30 members over a plot
area admeasuring 14.5 gunthas. Paragraph 9 recites that possession of the area
ad measuring 14.5 gunthas together with available FSI is being handed over to
the developer on consideration of the price noted in the agreement. Paragraph
11 of the agreement recites that the developer would secure the sanction of
plan and complete the construction of the building within a period of one year.
Paragraph 12(1) recites that the possession of the plot ad measuring 14.5
gunthas is handed over to the developer at the time of entering into the
agreement. Paragraph 12(3) recites that the developer shall commence the
construction and complete the same within one month from the date of receipt
of possession. However, on account of escalation caused in steel and cement
and other construction material, if some further time is required, the same can
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be allowed with the consent of the architect. The developer was supposed to
raise construction with his own cost as per sub-para 4 of para 12 of the
agreement. Sub-para 8 recites that if any individual member makes a demand
of constructed area beyond 500 sq. ft., he will be charged Rs.1000 per sq. ft.
for an area to the extent of 150 sq. ft. beyond 350 sq. ft.. If the member
desires to purchase the area more than 500 sq. ft., the developer would be
entitled to charge rate beyond 500 sq. ft. as per the prevailing market rate.
Sub-para 11 of the para 12 recites that, if any member outside the 30 members
of the Society purchases a flat, the developer shall charge at the rate of ---- per
sq. meter. The rate has not been mentioned in the column and is kept blank.
It is also recited in the same clause that the amount derived shall be utilized for
construction of the building. Paragraph no. 12(12) of the agreement recites
that the developer shall enter into a separate agreement with the prospective
purchasers and may recover the price thereof. It is recited in Paragraph 14 of
the agreement, that the developer would admit the purchasers as the members
of the Society and would allot the flats to them. It is further recited that the
developer would recover Rs. ...... per sq. ft. and enter into an agreement and
would recover amount in terms of the fresh agreement. The amount that could
be charged by the developer is kept blank in column no. 14.
7. There is an another agreement entered into between the 3 promoter
members and the contractor. The developer is referred to as a contractor in the
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subsequent agreement dated 25th June, 2004. Paragraph no. 5 of the agreement
recites that the contractor shall charge Rs. 600/- per sq. ft. towards the
construction charges for an area of 300 sq. ft. and if any member intends to
have an area beyond 300 sq. ft., the contractor is entitled to charge Rs. 1000/-
per sq. ft. for additional 100 sq. ft. area and at the rate of Rs. 2000/- per sq. ft.
beyond 400 sq. ft. area. Paragraph No. 14 of the agreement recites that if any
member of the Society is not desirous of purchasing a flat, the
developer/contractor shall pay Rs. 2 lakhs to such member. It was left to the
discretion of the contractor to secure resignation of the members who do not
desire to purchase flat and he is also entitled to enroll new members and allot
flats to them. It was the responsibility of the administrative committee of the
society to enroll such person as a member of the Society and allot shares.
Paragraph No. 19 of the agreement stipulates that after construction of the
building and allotment of flats to the members, if any further FSI becomes
available, the contractor would be entitled to utilize the said additional FSI and
construct another building for additional flats and the administrative
committee would not take any objection thereto. Paragraph No. 20 of the
agreement prescribes that if the developer/contractor desires to purchase any
additional TDR, the Society would cooperate in tendering necessary
applications. However, the cost of TDR would be borne by the
contractor/developer. As per Clause 21 of the agreement the contractor had an
option to sell out additional flats to prospective purchasers who are entitled to
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be enrolled as members and it was the responsibility of the contractor to secure
appropriate permission from the Collector and Social Welfare Department and
to bear the expenses for that purpose.
8. The Counsel appearing for the appellant vehemently contended that on
reading the terms of agreement it is evident that interest in land is created in
favour of the developer and he is not merely a contractor appointed for
constructing the building and for handing over the constructed portion to the
members of the society.
Reliance is placed on the judgment in the matter of
Chheda Housing Development Corporation v/s. Bibijan Shaikh Farid & ors.
(2007(3) Mh. L.J.) and it is contended that agreement entered into between the
members of the Society and the developer shall fall within the ambit of clause
(b) of para 12A of the Judgment and, therefore, specific performance of the
agreement is permissible. In para 12A of the Judgment it is recorded by the
Division Bench thus:
"12A. In our opinion, from a conspectus of these judgments,
what is relevant would be the facts of each case and the
agreement under consideration. Agreements considering what
is discussed, amongst others, could be:-
(a) An agreement only entrusting construction work to
a party for consideration;
(b) An agreement for entrusting the work of
development to a party with added rights to sell the
constructed portion to flat purchasers, who would be forming
a Co-operative Housing Society to which society, the owner
of the land, is obliged to convey the constructed portion as
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also the land beneath construction on account of statutory
requirements.
(c) A normal agreement for sale of an immovable
property.
An agreement of the first type normally is not
enforceable as compensation in money is an adequate
remedy. An agreement of the third type would normally be
specifically enforceable unless the contrary is proved. A
mere agreement for development, which creates no interest in
the land would not be specifically enforced."
9. My attention is also invited to paragraph 16 of the Judgment and it is
contended that as the developer is permitted to use additional FSI in terms of
the agreement, prima-facie agreement can be specifically enforced and in such
circumstances irreparable loss and injury would be caused to the appellants, if
the injunction is not granted.
10. I have considered the submissions advanced by learned Senior Counsel
for the appellant. It is to be noted that as per the consent terms as recorded in
writ petition No. 3400/2002, it was the responsibility of the promoters to
complete the construction of building, after getting possession of plot and form
separate co-operative Society. In the instant matter, though the agreement is
entered into on 1st October, 2003 and inspite of agreement for raising
construction of the building with the developer, work of construction has not
yet commenced. The first agreement dated 1st October, 2003 stipulates entering
into a further agreement and 2nd agreement was entered into on 25th June, 2004.
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In terms of agreement dated 25th June, 2004, the plaintiff is referred to as a
contractor and has been assigned the work of constructing a building at the rate
of Rs. 600/- per sq. ft. for first 300 sq. ft. area and at the rate of Rs. 1000/- sq.
ft. for additional 100 sq. ft. area and at the rate of Rs. 2000/- per sq. ft. for any
additional area beyond 400 sq. ft.. It is true that Paragraph No. 19 of the
Agreement refers to utilization of additional FSI by builder for constructing
additional building and additional flats and for disposing of the same and for
appropriation of the amount. Pursuance to the subsequent agreement entered
into between parties plans were still not drawn and it was not ascertained as to
whether the additional FSI would be available and how much it would be.
According to Counsel appearing for appellant, the plaintiff is entitled to
specifically enforce the agreement. In view of the terms of agreement, if read
harmoniously, would come within the ambit of clause (b) of para 12A of the
Judgment recorded in Chheda Housing Development Corporation's matter
(supra). Even if assuming that the terms contained in agreement entitle
plaintiff to claim specific performance of agreement, however, the plaintiff is
not claiming specific performance of the agreement. The plaintiff has come to
the Court merely complaining about the interference by the defendants and is
seeking a decree simplicitor for injunction.
11. The argument advanced by the respondent/defendant that the plaintiff has
suppressed material facts regarding the termination of the agreement is also
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required to be considered. My attention is invited to the letter issued by the
Advocate for the defendants on 6th October, 2006 wherein in Paragraph No. 6 is
specifically recorded that, 'if you do not respond in a week's time, the
agreements with my clients shall stand terminated (The agreements already
stand terminated, but indulgence was given on your approaching the
undersigned and making oral promise of carrying out obligations as per the
agreement)'. Thus, termination of agreement is communicated by letter dated
6th October, 2006, however, at sametime a week's time is given to the contractor
to comply with certain terms.
ig It is recorded in paragraph 5 of the said letter
thus:-
"5. (i) To give in writing that you will provide cost free flats
to 24 members, as provided in the agreement signed by you
through Mr. Shukla. Though it is desirable that a better
worded fresh agreement be drawn and executed dispelling the
confusion/contradiction in earlier writings.
(ii) To give undertaking that you will complete the
building, as per the I.O.D. Being processed, within one year
and give possession of flats to 24 members of the Society and
to none else (you Mr. Shukla had asked the members present
on 1st October, 2006 meeting, if they will accept money, in lieu
- which shows you are driving a wedge).
(iii) To give indemnity/ Bank guarantee that you will
complete the Building and not leave it half way."
12. There is another letter dated 8th January, 2007 wherein a final call has
been given to the plaintiff-promoter to comply with the conditions. It is also
recorded in Paragraph No. 8 of the letter that he is also called upon to enter into
a supplementary agreement copy of which was sent to him. It is recorded in
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Paragraph No. 8 of the letter that if it is not acceptable and if the
contractor/developer fails to respond within 14 days of the receipt of letter, it
would be open for the defendants to get the building constructed from a third
builder. Thus, there appears to be termination of agreement by virtue of letter
dated 6th October, 2006 and 8th January, 2007. It is vehemently contended by
the appellant that considering the tenure of the letters quoted above, it cannot
be construed as termination of the agreement. The fact, however, remains that
there is absolutely no reference to aforesaid two letters in the plaint. Thus, the
contention raised by the defendants that there is suppression of material facts
by the plaintiff bear some substance. My attention is invited to the Judgment
in the matter of S.P. Chengalvaraya Naidu (dead) by Lrs vs. Jagannath
(dead)by LRs (AIR 1994 Supreme Court 853) wherein the Apex Court has
observed thus:
" The courts of law are meant for imparting justice
between the parties. One who comes to the court, must
come with clean hands. It can be said without hesitation that
a person whose case is based on falsehood has no right to
approach the Court. He can be summarily thrown out at any
stage of the litigation. A litigant, who approaches the court,
is bound to produce all the documents executed by him
which are relevant to the litigation. If he withholds a vital
document in order to gain advantage on the other side then he
would be guilty of playing fraud on the court as well as on
the opposite party."
13. Considering the fact that plaintiff has suppressed material facts from the
Court I am of the view that plaintiff is not entitled to discretionary relief of
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injunction. The question of balance of convenience also needs to be looked
into in its proper perspective. As per the terms of settlement the promoters
were required to get the building constructed in two years. The defendants
have entered into agreement with the Contractor on 1st October, 2003 and 2nd
agreement is dated 25th June, 2004. However, inspite of executing the
agreement way back in 2003 and 2004, the contractor has not commenced the
work of construction of the buildings. It is to be noted that the 24 members of
the Society belong to backward community and their interest does not appear to
have been looked after by the builder/developer/plaintiff. Thus the balance of
convenience does not lie in favour of the plaintiff. It is also argued by the
respondent-original defendants that though the subsequent agreement was
entered into between the promoters on behalf of the society, in the instant suit
the Society is not made party. The plaintiff has also not claimed specific
performance of the agreement neither the Society is made party.
14. For the reasons recorded above, I am of the view that prima-facie case as
well as balance of convenience does not lie in favour of the plaintiff. The trial
Court was justified in refusing to grant injunction in the matter. It is not a case
for the Appellate Court to cause interference. Exercise of discretion by the
trial Court cannot be said to be perverse or fanciful. There is no reason to cause
interference in the order passed by the trial Court. Appeal from Order stands
dismissed.
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15. In view of the dismissal of Appeal from Order, civil application does not
survive and stands disposed of.
16. The Counsel for the appellant prays for continuation of interim-relief for
further period with a view to avail of the appellate remedy by the plaintiff-
appellant herein. This Court by order dated 20th October, 2011 directed the
parties to maintain status-quo. The order of status-quo passed by this Court
shall remain operative for a further period of six weeks from today.
(R.M.BORDE, J)
