Bombay High Court

Niwara Co-Operative Housing ... vs Smt. Aasha Ramesh Chaurasiya on 16 March, 2017

Bench: Prasanna B. Varale

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                 THE HIGH COURT OF JUDICATURE AT BOMBAY
                        : NAGPUR BENCH : NAGPUR.

                             WRIT PETITION NO. 5339 OF 2015

Niwara Co-operative Housing Society 
Limited, Borgaon, Gittikhadan, 
Gorewada Road, Nagpur, through 
its President.                                                                                  ... Petitioner

             VERSUS

Smt. Aasha Ramesh Chaurasiya, 
Aged about 47 years, Occupation - Household, 
Resident of B-4, WCL Colony, 
Civil Lines, Nagpur 440 001.                                                                 ... Respondent
-------------------------------------------------------------------------------------------------
Shri H. S. Chitaley, Advocate for the petitioner 
Shri A. C. Khare, Advocate for the respondent
------------------------------------------------------------------------------------------------------------------------

                                                       CORAM :  PRASANNA B. VARALE, J.
                                                       DATED : 16/03/2017

JUDGMENT

Rule. Rule made returnable forthwith.

2. The petitioner by way of present petition challenges the

judgment and order passed by the learned Member, Maharashtra State

Co-operative Appellate Court (Mumbai) Bench, Nagpur dated 7-5-2015.

3. Brief facts giving rise to the present petition can be

summarized as follow.

(i)       The petitioner is a cooperative housing society.  The respondent,





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a member of the said society submitted a dispute before the Cooperative

Court, Nagpur. It was submitted in the dispute that the petitioner-

society had prepared a housing scheme and lay out plan for Kh. No. 24,

P.H. No. 7, Mouza Hajaripahad, Tahsil and District Nagpur. As the

respondent was in need of 3000 Sq. ft. plot for construction of house,

she had approached the society. It is the case of the respondent that as

the society was not having a plot of area of 3000 Sq. ft., the respondent

was suggested to take adjacent plots. The price of the said plots was

Rs. 1,05,000/-. The respondent entered into an agreement and as an

earnest amount paid Rs. 20,000/-. It was agreed that the remaining

amount shall be paid at the time of registry. It was further submitted in

the dispute that the petitioner-society agreed to convert the agricultural

land into non-agricultural land and further agreed to get the registry of

the plot done up to 31st January, 2005. It was submitted by the

respondent in the dispute that instead of performing the promise, the

society demanded certain extra amount. It was agreed between the

parties that the respondent would pay certain extra amount, as such, the

respondent served the notice to the petitioner-society. It was further

submitted that as per the terms agreed between the parties, the

respondent had paid total sum of Rs. 76,400/- by way of cheques in

installments. The respondent came across a public notice issued in the

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newspaper i.e. daily 'Lokmat' on 15-5-2005. It was stated in the notice

that the noticee and the society entered into an agreement of sale of 6

acres of land to the west side of P.H. No. 7, Mouza Hajaripahad. The

respondent was shocked and surprised to see the said public notice and

with some plot holders, they made an attempt to meet the President of

the society. The President of the society was not available in spite of

attempts made to contact the President of the society. As there was no

response, the respondent issued notice to the President of society. As

there was no positive response to the notice, the respondent approached

the learned Judge of the Co-operative Court, Nagpur by raising Dispute

No. 591/2005 with the prayers, namely :

a. It be declare that the disputant is entitle for a plot No. 47 & 48 of Khasra No. 24, P.H. No. 7, Mauza HajariPahad Tahsil District Nagpur, belonging to opponent society.

b. The disputant be put in possession of plot No. 47 & 48 of Khasra No. 24, P.H. No. 7, Mauza HajariPahad Tahsil District Nagpur, belonging to opponent society.

c. Direct the opponent society to execute sale deed in favour of disputant of plot No. 47 & 48 of Khasra No. 24, P.H. No. 7, Mauza HajariPahad Tahsil District Nagpur, belonging to the opponent society.

d. Any other relief that may deem necessary in the interest of justice may be granted.

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          e.       Cost   of   the   proceeding   be   saddled   on   the   opponent
          society. 


(ii)     A   heavy   reliance   was   placed   by   the   respondent-disputant   on   a

document, named and styled as 'Sauda Chitthi'. The petitioner-society

filed written statement to the dispute and raised preliminary objections.

The respondent-disputant led evidence on affidavit. The petitioner-

society except filing written statement and objections failed to appear

before the learned Judge of the Co-operative Court. The learned

Judge of the Co-operative Court, Nagpur by judgment and order dated

17-9-2014 directed the petitioner-society to refund the amount to the

disputant deposited by her for the plots in question.

(iii) The respondent feeling aggrieved by the judgment and order

passed by the learned Judge, Co-operative Court, Nagpur preferred the

appeal before the Maharashtra State Co-operative Appellate Court,

Bench at Nagpur i.e. Appeal No. 47/2014. The learned Member,

Maharashtra State Co-operative Appellate Court (Mumbai), Bench,

Nagpur allowed the appeal on the terms namely :

2] The Judgment and award dated 17/09/2014 passed by Ld. Judge, Co-operative Court, Nagpur in dispute bearing No. 591/2005 is hereby set aside, and substituted as under:

          i]       Dispute   bearing   No.   591/2005   filed   by   disputant   is





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          hereby allowed. 

          ii]      It is hereby declared that the disputant is entitled for

plot No's 47 & 48 of Khasra No. 24, p.h. No. 7, Mauza Hajaripahad Tehsil District Nagpur, belonging to opponent society.

iii] The opponent society is hereby directed to execute sale deed in respect of plot No's 47 & 48 in favour of the disputant within 2 months from this order and hand over possession of the said plot's to the disputant.

iv] The disputant is hereby directed to pay the remaining amount out of the total amount of the plots in question to the society as well as to bear the registration charges of the sale deed at the time of execution of the sale deed.

v] On failure on the part of the opponent society to execute the sale deed within the period as per clause 2 of this order, the disputant is at liberty to get execute the sale deed through the process of law.

vi] The opponent society is hereby directed to pay the cost of the dispute to the disputant and should bear its own cost.

vii] R & P of Trial court be sent to the trial court immediately.

4. Shri H. S. Chitaley, learned counsel for the petitioner

vehemently submitted that the judgment and order passed by the

appellate court is clearly unsustainable on more than one ground.

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Shri Chitaley, learned counsel submitted that the learned appellate court

failed to appreciate the prayers made in the appeal by the respondent

and also failed to appreciate the material placed on record. It was also

the submission of Shri Chitaley, learned counsel that the learned

appellate court while allowing the appeal granted the reliefs to the

respondent which were not even claimed by the respondent. Learned

counsel for the petitioner submitted that the respondent heavily relied

on a document, named and styled as 'Sauda Chitthi' for putting forth her

claim before the learned Judge, Co-operative Court. It was the

submission of Shri Chitaley, learned counsel that as the said document

was not a registered document, no reliance could have been placed on

such a document to substantiate the claim of the respondent. He further

submitted that though the respondent-disputant referred to the

document i.e. agreement to sale and the said document was not placed

on record by the respondent along with the dispute filed by her, the

same was placed subsequently on record. Shri Chitaley, learned counsel

submitted that the petitioner-society in the written statement filed

before learned Judge, Co-operative Court raised the ground of objection

that the dispute itself was not maintainable. Shri Chitaley, learned

counsel submitted that the society purchased the property, namely,

agriculture land and decided to convert the said agriculture land into

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non-agricultural land. He further submitted that the petitioner-society

could not have sold the agriculture land to its members and it could

have only sold the land after its conversion from agricultural to non-

agricultural and for such conversion of land, certain procedure is

required to be done. He submitted that the competent authority for

grant of conversion is the Collector and the Collector through his agents

on perusal of the agricultural land and on satisfaction of necessary

compliance of the norms prescribed under the law grants permission for

the conversion of land. Shri Chitaley, learned counsel submitted that

there is also requirement for the petitioner-society to submit the

tentative map before the competent authority, namely, the Nagpur

Improvement Trust and Nagpur Municipal Corporation which are

autonomous bodies and after approval of these authorities, the

petitioner-society receives the sanction for lay outs. It was the

submission of Shri Chitaley, learned counsel that none of such

requisites, approval and permission was granted by the authorities, as

such, the petitioner-society was unable to sell the plot to the respondent-

disputant. He submitted that in the written statement, this procedural

aspect was submitted in detail. He further submitted that the petitioner-

society could not have been carved plots from the said agricultural land

without the necessary sanction and permission of the competent

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authority and, as such, the so called 'Sauda Chitthi' wherein the

respondent-disputant herself referred to the plot numbers is of no

consequence for establishing any right in favour of the respondent-

disputant. Shri Chitaley, learned counsel then submitted that the

learned Judge of the Co-operative Court framed the issues for

consideration and findings to issue nos. 6 and 7 are negative and these

findings support the case of the petitioner. Shri Chitaley, learned

counsel then submitted that the respondent by filing the appeal before

the Maharashtra State Co-operative Appellate Court only prayed for

grant of compensation at the market rate of plot with interest at the rate

of 24% per annum along with the costs. He submitted that though the

respondent failed to pray the relief in nature of the execution of sale

deed, the appellate court erroneously while allowing the appeal

held that the respondent is entitled for plot Nos. 47 and 48 and

further directed society to execute sale deed within stipulated period.

Shri Chitaley, learned counsel submitted that the appellate court even

though had not framed the point for consideration in respect of

execution of sale deed, allowed the appeal and granted the relief which

was not prayed for. Shri Chitaley, learned counsel by inviting my

attention to certain provisions of the Specific Relief Act, 1963 submitted

that the learned appellate court could not have exercised its discretion

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by issuing directions to execute sale deed while the learned Co-operative

Court already by exercising its discretion directed the petitioner-society

to refund the amount deposited by her for the plot in question.

Shri Chitaley, learned counsel further submitted that though assuming

that the appellate court could have exercised its own discretion as an

appeal being the continuation of the proceedings, the appellate court

could not have travelled beyond the scope of award of compensation as

it was the only prayer made by the appellant. Thus, Shri Chitaley,

learned counsel prays for quashing and setting aside the judgment and

order passed by the Maharashtra State Co-operative Appellate Court. In

the alternative, Shri Chitaley, learned counsel submits that as the

learned Co-operative Court failed to consider the issues raised by the

petitioner, the matter be remitted back to the appellate court for

decision afresh.

5. Shri Khare, learned counsel for the respondent supports the

order passed by the appellate court. It was the submission of Shri Khare

that the respondent had already made a prayer in the dispute in respect

of the execution of sale deed and the appeal being the continuation of

the proceeding, it was not necessary for the respondent to make such a

prayer. Shri Khare, learned counsel then submitted that by way of

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pursis, Exhibit No. 37, the respondent prayed for alternate relief.

Shri Khare, learned counsel then submitted that the petitioner-society

was unable to place any material either before the learned Co-operative

Court or before the Maharashtra State Co-operative Appellate Court and

even before this Court to show that the petitioner-society had

approached the competent authority for the necessary sanction and

approval for conversion of the land.

6. Before proceeding further, it will be necessary to state here

that during the pendency of the petition, this Court was of the opinion

that exploring the possibility of settlement of dispute through mediation

process may be helpful for the parties, accordingly, the matter was

referred to the learned Mediator. The report submitted to this Court

showed that the mediation process failed. It will also be not out of place

to state that in view of the submissions of the learned counsel for the

petitioner, namely, that in the prayer clauses before the Maharashtra

State Co-operative Appellate Court, there was no prayer for allotment of

plot nos. 47 and 48 and in spite of this, the appellate court allowed the

dispute by allotting the plot nos. 47 and 48 to the respondent and

directed the petitioner-society to execute sale deed, this Court issued

notice and ad-interim relief was granted in favour of the petitioner. As

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the backdrop of the dispute is already referred to, it may not be

necessary to repeat the same.

7. On going through the material placed on record and on

going through the record of the Courts below which was called by this

Court, I find considerable merit in the submissions of Shri Chitaley,

learned counsel for the petitioner. The submission of the petitioner-

society before the learned Judge of the Co-operative Court in the written

statement and the objection raised was specific on the aspect of inability

of the petitioner-society to convert the agricultural land into non-

agricultural land without having any sanction or approval from the

appropriate and competent authority. The learned Co-operative Court

resultantly found inability to execute the sale deed. The learned Co-

operative Court framed the issues on the backdrop of the submissions,

namely, issue nos. 6 and 7 as :

6. Is disputant entitled for execution of sale deed of suit plots as sought ?

7. Is disputant entitled for recovery of possession of suit plots ?

The learned Co-operative Court recorded its findings in negative to

these issues. The reasoning given by the learned Co-operative

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Court reads thus :

23. The disputant by way of the present dispute has sought the declaration that, she is entitled for the plots in dispute and for direction to the opponent society to execute sale deed and deliver possession of plots to her. Whereas, the opponent society has came a specific case that, the society can not execute the sale deed unless and until the lay-out plan of opponent society is sanctioned by the Nagpur Improvement Trust. The disputant at Exh. 37 has filed the pursis thereby stated that, the Nagpur Improvement Trust has not sanctioned the plots in question. Therefore, once the condition precedent for execution of sale deed has not been complied with no question of giving direction to the opponent society to execute the sale deed in favor of disputant arises at all. At the same time the disputant would not be entitled for recovery of possession of suit plots as claimed by her in the dispute because the pursis filed by disputant at Exh. 37 dis- entitled the disputant from claiming such relief and in fact the said relief does not survive the moment the N.I.T. has not sanctioned the lay-out map of opponent society which is condition precedent of execution of sale deed and to claim possession over suit plots.

The respondent had filed a pursis before the learned Co-operative Court,

Exhibit 37. The learned Co-operative Court observed thus on the aspect

of pursis, Exhibit 37 that :

24. In the pursis at Exh. 37 the disputant has prayed that, the amount deposited by disputant for the plots that may be refunded alongwith interest to the disputant and a portion of market value of plot be granted as compensation. From the documents at Exh. 27/C and 13 it appears that the disputant at the time of executing Souda Chitthi Exh. 27/C has paid Rs. 20,000/- and there after also deposited certain amounts towards the plots in question with the opponent society vide Exh. 13 receipts. Therefore, in such circumstances when the

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transaction involved in dispute has failed due to non- compliance of legal formalities which are the condition precedent I am of the considered view that, it would be just, legal and proper to direct the opponent society to refund the amount deposited by the disputant for the plots in question. So far as the prayer of disputant regarding refund of amount with interest and a portion of market value of plot as compensation is concern the same can not be considered because there was no such agreement at all in between disputant and opponent society.

8. The record of the Courts below was called for. Contents of

Pursis, Exhibit 37 reads thus :

"The disputant states that the plot in question is not sanctioned by the NIT (Nagpur Improvement Trust), the documents in that regard has been presented to this hon'ble Court. Hence this hon'ble Court may be kind enough to grant relief in terms of alternative relief by refund of money along with interest and a portion of market value of the plot as compensation.

Hence the Pursis."

Perusal of the pursis clearly shows that the respondent admitted the fact

that there was no sanction granted by the Nagpur Improvement Trust

and prayed for alternative relief by refund of money along with interest

and a portion of market value of the plot as compensation. The learned

Co-operative Appellate Court failed to consider this material aspect.

The learned Co-operative Appellate Court placed heavy reliance on the

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'Sauda Chitthi'. It is not in dispute that the said document is not a

registered document and the document which could have been looked

into for the purpose of the controversy involved in the proceeding was

the agreement to sale between the parties. The learned appellate court

on the ground that the petitioner-society failed to enter into the witness

box before the trial Court and also before the appellate court recorded

certain negative findings without considering the relevant aspects,

namely, whether the relief which was not prayed by the appellant could

have been granted to it ?

9. There was also merit in the submission of Shri Chitaley,

learned counsel for the petitioner that in view of the provisions of

Specific Relief Act, the discretion was already exercised by the Co-

operative Court and the appellate court could not have directed the

petitioner-society to execute sale deed. Shri Chitaley, learned counsel

draw support by referring to Section 14(1)(a) and the same reads thus :

14. Contracts not specifically enforceable. - (1) The following contracts cannot be specifically enforced, namely :-

(a) a contract for the non-performance of which compensation in money is an adequate relief ; .....

It was the submission of Shri Chitaley, learned counsel that in view of

the submission of the petitioner-society though it was unable to perform

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the contract, as such, the award compensation was adequate relief

granted by the learned Co-operative Court. Shri Chitaley, learned

counsel further submitted that due to the impediments, such as,

receiving necessary approval and sanction from the competent

authorities, the case of the petitioner-society was falling under the

category of the cases wherein the specific performance of contract was

unforceable. He also heavily relied on the provision of said Act, namely,

Section 20(1) and Section 20(3) on the aspect of discretion exercised by

the Co-operative Court. The same reads thus :

20. Discretion as to decreeing specific performance. - (1) The jurisdiction to decree specific performance is discretionary, and the Court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the Court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a Court of appeal.

(2) ......

(3) The Court may properly exercise discretion to decree specific performance in any case where the plaintiff has done substantial acts or suffered losses in consequence of a contract capable of specific performance.

(4) .....

10. Shri Chitaley, learned counsel for the petitioner placed

reliance on the judgment of the Apex Court in the case of Bal Krishna

and anr. Vs. Bhagwan Das (Dead) by L.Rs. and ors. reported in AIR

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2008 SC 1786. It will be useful to refer the observations of the Apex

Court in the said judgment.

8. Section 16 of the Specific Relief Act, 1963 (hereinafter referred to as "the Act") corresponds with Section 24 of the old Act of 1877 which lays down that the person seeking specific performance of the contract, must file a suit wherein he must allege and prove that he has performed or has been ready and willing to perform the essential terms of the contract, which are to be performed by him. The specific performance of the contract cannot be enforced in favour of the person who fails to aver and prove his readiness and willingness to perform essential terms of the contract. Explanation (ii) to clause (c) of Section 16 further makes it clear that plaintiff must aver performance of, or readiness and willingness to perform, the contract according to its true construction. The compliance of the requirement of Section 16(c) is mandatory and in the absence of proof of the same that the plaintiff has been ready and willing to perform his part of the contract suit cannot succeed. The first requirement is that he must aver in plaint and thereafter prove those averments made in the plaint. The plaintiffs readiness and willingness must be in accordance with the terms of the agreement. The readiness and willingness of the plaintiff to perform the essential part of the contract would be required to be demonstrated by him from the institution of the suit till it is culminated into decree of the court. It is also settled by various decisions of this Court that by virtue of Section 20 of the Act, the relief for specific performance lies in the discretion of the court and the court is not bound to grant such relief merely because it is lawful to do so. The exercise of the discretion to order specific performance would require the court to satisfy itself that the circumstances are such that it is equitable to grant decree for specific performance of the contract. While exercising the discretion, the court would take into consideration the circumstances of the case, the conduct of parties, and their respective interests under the contract. No specific performance of a contract, though it is not vitiated by fraud or misrepresentation, can be granted if

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it would give an unfair advantage to the plaintiff and where the performance of the contract would involve some hardship on the defendant, which he did not foresee. In other words, the courts discretion to grant specific performance is not exercised if the contract is not equal and fair, although the contract is not void.

11. Considering all the above aspects, I am of the opinion that

the learned Cooperative Appellate Court failed to consider the relevant

and material aspects raised by the petitioner and, as such, erred in

allowing the appeal and issuing the directions. The judgment and order

passed by the learned Cooperative Appellate Court is thus unsustainable

as the appellate court failed to consider these aspects. It would be

necessary to remand the matter back to the Cooperative Appellate Court

for its fresh decision.

12. Writ petition is partly allowed and the order passed by the

learned Maharashtra State Cooperative Appellate Court is quashed and

set aside.

13. Learned Maharashtra State Cooperative Appellate Court is