Bombay High Court
M/S. Bharti Infra, Thr. Its Prop. ... vs M/S. Aatmey Realtors Partnership ... on 14 November, 2017
Bench: Anuja Prabhudessai
AO 967-16
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
APPEAL FROM ORDER NO. 967 OF 2016
WITH
CIVIL APPLICATION NO. 1211 OF 2016
1. M/s. Bharti Infra
through its proprietor
Shri Hiten Kishan Lehru
Adult , Occ: Business
having its office at Ofice No.405,
Thakkar Tower, Plot No.86,
Sector 17, Vashi
Navi Mumbai
2. M/s. Shree Developers
Registered Partnership firm
through its partners
a) Ravindra Madhukar Patil
aged 52 years, Occ: Business
b) Smt. Sangeeta Mahendra Mhatre
Adul, Occ: Business
having office at Shop No. 06,
Yoganand Complex,
Plot No.E-103,
Sector 3, Kharghar,
Navi Mumbai .. Appellants
(Org. Plaintiffs)
v/s.
1) M/s. Aatmey Realtors,
Partnership firm
havingn office at Jasai,
Taluka Panvel, District Raigad.
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AO 967-16
2) Shri Ajinkya Anand Gharat,
Adult, Occ: Agriculturist,
3) Shri Anant Nathuram Gharat,
Adult, Occ: Agriculturist,
4) Shri Prabhakar Nathuram Gharat,
Adult, Occ: Agriculturist,
5) Shri Madhukar Nathuram Gharat,
Adult, Occ: Agriculturist,
6) Smt. Banubai Namdeo Patil,
Adult, Occ: Agriculturist.
7) Shri Chandrakant Balaram Mhatre,
Adult, Occ: Agriculturist,
8) Shri Mohan Balaram Mhatre,
Adult, Occ: Agriculturist,
9) Shri Dinkar Balaram Mhatre,
Adult, Occ: Agriculturist,
10) Smt. Hirabai Jairam Mhatre,
Adult, Occ: Agriculturist,
11) Smt. Champabai Pandurang Patil,
Adult, Occ: Agriculturist,
12) Smt. Nirmalabai Dhanaji Patil,
Adult, Occ: Agriculturist,
Nos.2 to 12 residing at Jasai,
Tal:Panvel, Dist: Raigad.
13) City & Industrial Development
Corporation,
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AO 967-16
Main Land & Survey Officer,
7th Floor, CIDCO Bhavan,
CBD Belapur, Navi Mumbai ..Respondents
Mr. S.M.Oak a/w. Mr. Sagar Joshi for the Appellant/Applicant.
Mr.P.S.Dani a/w. Ganesh Bhujbal for the Respondent Nos.1 to 5.
CORAM : SMT. ANUJA PRABHUDESSAI, J.
RESERVED ON : 16TH JUNE , 2017
PRONOUNCED ON : 14TH NOVEMBER, 2017.
JUDGMENT.
1. The appellants herein have challenged the Order dated 30 th
June, 2016 whereby the learned Civil Judge, Senior Division, Panvel
has dismissed the application for temporary injunction (Exhibit 5)
filed in Special Suit No. 46 of 2010.
2. The appellants herein were the plaintiffs and the respondents
were the defendants in the said suit and for the sake of convenience
they shall be referred to as the plaintiffs and defendants respectively.
3. The brief facts necessary to decide this appeal are as under:-
The defendant nos.3 to 6 and one Yamunabai Mhatre were the
pps 3 of 19
AO 967-16
owners of the property under Survey No. 305 Hissa No.19B, Survey
No.304 Hissa No.19C and Survey No.304 Hissa No. 21C situated at
Jassai, Panvel, District Raigad. The said property was acquired by
the defendant no.13. The defendant nos.3 to 6 and said Yamunabai,
being Project Affected Farmers were allotted the land bearing Plot
No. C-4 Sector 8 admeasuring 1149.73 sq.meters under the 12.5
Scheme. The said plot shall be hereinafter referred to as the suit
land. The defendant nos.3 to 6 and said Yamunabai had decided to
develop the suit land. The plaintiff no.2 had agreed to develop the
suit land and hence, on 22.10.2012 the plaintiff no.2 and the
defendant nos.3 to 6 and said Yamunabai entered into a development
agreement. In terms of the said agreement, the plaintiff no.2 had
agreed to give to the defendant nos.3 to 6 and Yamunabai 50%
construction of the proposed building and cash of Rs.2 Crores 7 lakhs
out of which Rs.44 lakhs were paid on the date of execution of the
said Development Agreement.
4. The plaintiff no.2 was unable to develop the said land on his
own due to financial constraints. Hence, he decided to develop the
pps 4 of 19
AO 967-16
suit land along with the plaintiff no.1. Accordingly, the plaintiff no.2
entered into a tripartite agreement dated 16.3.2013 with the plaintiff
no.1 and the defendant nos. 3 to 6 and Yamunabai. In terms of the
said Agreement, the plaintiffs paid to the defendant nos.3 to 6 and
said Yamunabai a sum of Rs.10 lakhs. The plaintiffs claim that in
addition to the said amount, they had also paid a sum of
Rs.28,50,000/- to the defendant nos.3 to 6 and Yamunabai. The
plaintiffs thus claim that they had paid total consideration of
Rs.82,50,000/-.
5. It is the case of the plaintiffs that they had taken all requisite
steps for allotment of the suit land in favour of the respondent nos.3
to 6 and Yamunabai Mhatre. They had also paid amount of
Rs.43,67,000/- towards the premium and other expenses. In the
meantime, said Yamunabai expired. The defendant nos.3 to 6 and
the defendant nos.7 to 13 who are the legal representatives of
Yamunabai started avoiding them. Sometime in the month of
October 2015 these defendants told them that the defendant no.13
had alloted the suit land to them by virtue of the Lease Deed dated
pps 5 of 19
AO 967-16
21.5.2014 and that they had given the suit land to the respondent
no.1 for development.
6. The plaintiffs claim that the defendant nos.3 to 12 could not
have entered into an agreement with the defendant no.1 during the
subsistence of the agreement dated 12.10.2012 and 16.3.2013. The
plaintiff, therefore filed a suit for specific performance and for
damages. During the pendency of the suit, the plaintiffs filed an
application for injunction seeking to restrain the defendants from
creating third party right in respect of the suit land.
7. The defendant nos. 3 to 6 have admitted having entered into an
agreement dated 12.10.2012 and 16.3.2013. The defendants have
also admitted having received total sum of Rs.54,00,000/- as part
consideration. The defendants have however denied having received
the amount of Rs.28,50,000/- at the time of execution of the
agreement dated 16.3.2013.
8. The defendants further claim that in terms of condition no.5 of
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AO 967-16
the agreement dated 12.10.2012 the plaintiff no.2 was required to
obtain a letter of allotment, to carry out actual measurement and
obtain the possession of the suit land from CIDCO. The defendants
claim that they had handed over to the plaintiffs all the documents
for complying with the said condition. However, the plaintiff no.2
avoided performing his part of the contract as stipulated in clause
no.5. The plaintiff no.2 told the defendant no.3 to engage his own
person for obtaining the letter of allotment. The plaintiffs further
agreed to bear the total expenses incurred in obtaining the letter of
allotment.
9. The defendants claim that with the assistance of one Sudhir
Shinde, they completed all the formalities of allotment of the suit
land on 25.3.2013. The Lease deed came to be executed on
21.5.2013. The said lease deed was registered on 19.9.2014. The
defendants claim that in addition to the amount of Rs.52 lakhs which
was paid at the time of execution of the said agreement the plaintiffs
were required to pay to them a sum of Rs.1,03,50,000/- as on the
date of the execution of the lease deed. The plaintiffs failed to pay
pps 7 of 19
AO 967-16
the said amount, furthermore, the cheques which were issued by the
plaintiff towards expenses of Sudhir Shinde were also dishonoured.
The defendants therefore decided to develop the said property on
their own and informed the plaintiffs accordingly. Those defendants
thereafter entered into an agreement dated 5.11.2014 with the
defendant nos.1 and 2 for developing the suit land. The defendants
further claim that the plans were sanctioned and necessary
permission for construction was granted by CIDCO on 17.2.2015. On
obtaining the said permission, they commenced the construction and
incurred expenses to the tune of Rs.1,75,00,000/-. The defendants
also claim that they have already sold the flats to various persons
whose names are disclosed in paragraph 6 of the written statement.
10. The defendants claim that the plaintiffs are not entitled for
interim relief as they had failed and neglected to perform their part
of the agreement. Further, they had approached the Court after
considerable delay. The defendants have stated that without
prejudice to the right to claim the damages they are willing to refund
to the plaintiffs or deposit in the Court the amount of Rs.24,00,000/-
pps 8 of 19
AO 967-16
with prevailing bank rates.
11. While dismissing the application for temporary injunction, the
learned Judge has held that the suit is barred by Section 69(2) of the
Indian Partnership Act.
12. Mr. Oak, the learned Counsel for the plaintiff has submitted
that the learned trial Judge has mis-interpreted and mis-construed
the provisions of Section 69(2) of the Indian Partnership Act. It may
be mentioned here that sub-section (2) of Section 69 provides that no
suit to enforce the right arisen from the contract shall be instituted in
any court by and on behalf of any persons against the third party
unless the firm is registered, and the person sueing are shown in the
Register of Firms as partners in the firm. In the instant case, the
learned trial Judge in paragraph 20 of the impugned order has
observed that the partnership firm was registered before filing of the
suit. The learned trial Judge has held that the suit is not
maintainable by virtue of Section 69(2) of the Partnership Act mainly
because the Development Agreement dated 12.10.2012 was executed
pps 9 of 19
AO 967-16
before the registration of the partnership firm.
13. As stated earlier, sub-section (2) of Section 69 only imposes a
bar on institution of suit by an unregistered firm. This section does
not create any bar for entering into a contract by an unregistered
firm. It is not in dispute that the partnership firm was registered
even before the accrual of cause of action and since the suit was filed
by a registered partnership, the bar under Section 69(2) is not
applicable.
14. The learned Judge has also held that the plaintiffs are not
entitled for interim relief as they failed to perform their part of
agreement as stipulated in clause 5 of the agreement dated
12.10.2012.
15. The learned Counsel for the plaintiff has submitted that the
defendants have admitted having entered into agreements dated
12.10.2012 and 16.3.2013, and also having received part
consideration in respect of the said agreements. He submitted that
pps 10 of 19
AO 967-16
the plaintiffs had paid to the defendant nos.3 to 12 total amount of
Rs.82,50,000/- as part consideration. The plaintiffs were always
ready and willing to perform their part of the contract, despite which
the defendant no.3 and his son, defendant no.2 formed a partnership
firm (defendant no.1) and the defendants entered into a
development agreement dated 5.11.2014 with the defendant no.1
with an intention of avoiding the performance of their part of
contract.
16. Mr.Dani, the learned Counsel for the defendants has submitted
that the plaintiff had not taken any steps to get the land allotted from
CIDCO, and having failed to perform their part of the contract under
clause 5, the plaintiffs were not entitled to seek specific performance
of the contract. The learned Counsel for the defendant has further
submitted that there is no prima facie material on record as regards
payment of Rs.28,50,000/-.
17. The learned Counsel for the defendant has submitted that the
plaintiff no.2 was present in the office of CIDCO on the date of
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AO 967-16
execution of the agreement dated 5.11.2014. The plaintiffs were
aware of the execution of the agreement despite which they did not
seek any prompt action and filed the suit only after the construction
had reached the plinth level and after the defendant had already
created third party interest in respect of the flats proposed to be
constructed in the suit land. The learned Counsel for the defendant
submits that the conduct of the plaintiffs as well as the delay in
approaching the Court does not justify grant of discretionary reliefs.
18. It is not in dispute that the defendant nos.3 to 6 and one
Yamunabai were the project affected farmers and the defendant
no.13 had decided to allot the suit land to the defendant nos.3 to 6
and Yamunabai in terms of 12.5 Scheme. The plaintiff no.2 and the
defendant nos.3 to 6 and Yamunabai had entered into an agreement
dated 12.10.2012 in respect of the suit land. In terms of the said
agreement, the plaintiff no.2 was to develop the said suit land and as
consideration thereof he had agreed to give 50% of the building
proposed to be constructed in the suit land, in addition to sum of
Rs.1,07,00,000/-. It was also agreed that the defendant nos.3 to 6
pps 12 of 19
AO 967-16
and said Yamunabai would obtain allotment letter, get the plot
demarcated and obtain the possession of the suit land within three
months from the date of execution of the said agreement. The
expenses towards the demarcation, measurements and obtaining
allotment letter were to be paid by the plaintiff no.2.
19. It is not in dispute that at the time of execution of the said
agreement, the plaintiff no.2 had paid to defendant nos.3 to 6 and
said Yamunabai, an amount of Rs.44 lakhs. It is also not in dispute
that the plot was not measured, demarcated or allotted within three
months from the date of execution of the said agreement.
Nevertheless, the plaintiff no.2 with consent of the defendant nos.3
to 6 and said Yamunabai decided to develop the suit land along with
the plaintiff no.1 and accordingly entered into a tripartite agreement
dated 16.3.2013. In the said agreement the parties had agreed that
there would be no change in consideration. However, it was agreed
that out of total cash consideration of Rs. 2 Crores 7 lakhs, in
addition to the amount of Rs.44 lakhs which was received at the time
of execution of agreement dated 12.10.2012, the plaintiff no.1 would
pps 13 of 19
AO 967-16
pay to the defendant nos.3 to 6 and Yamunabai a sum of Rs.10 lakhs
at the time of execution of the agreement dated 16.3.2013. The
plaintiff was also required to pay an amount of Rs.1,03,50,000/- at
the time of execution of the lease agreement with CIDCO and after
obtaining the possession and letter of allotment of the suit land, and
executing the tri-parte agreement. The balance amount of
Rs.51,75,000/- was to be paid on obtaining the construction
permission from CIDCO.
20. The defendants have not disputed having received
Rs.44,00,000/- at the time of execution of the first agreement and
an amount of Rs.10,00,000/- at the time of execution of the
agreement dated 16.3.2013. Though the plaintiffs have claimed that
in addition they have paid Rs.28,00,000/-, there is no prima facie
material to substantiate the said claim.
21. Be that as it may, both these agreements were executed even
before the suit land was measured, demarcated and allotted to the
defendant nos.3 to 6 and Yamaunabai. It is thus evident that on the
pps 14 of 19
AO 967-16
date of execution of these two agreements, the defendant nos.3 to 6
and Yamunabai had no right, title and interest in respect of the suit
land. One of the conditions as stipulated in clause 5 of the
agreement was that the defendants were to take all necessary steps
for getting the plot measured, demarcated and allotted in their
favour within three months from the date of execution of the
agreement and the expenses towards the same were to be borne by
the plaintiffs.
22. The material on record prima facie reveals that the defendants
had taken assistance of one Sudhir Shinde to get the plot measured,
demarcated and allotted. It is not in dispute that the cheque issued
by the plaintiff towards the expenses incurred by said Sudhir Shinde
were dishonoured. Thus, there was no compliance of clause 5 of the
agreement dated 12.10.2012, which as stated earlier stipulated that
the plaintiff would incur all expenses in respect of the measurement
demarcation and allotment of the said plot.
23. The records reveal that the plot was measured and demarcated
pps 15 of 19
AO 967-16
on 18.4.2013 and a lease agreement in respect of the suit land was
executed between the defendant nos.3 to 12 and 13 on 21.5.2014.
As stated earlier, in terms of agreement dated 16.3.2013, the
plaintiffs were required to pay to the defendant nos.3 to 12 an
amount of Rs.1,03,50,000/- as on the date of execution of the lease
deed with CIDCO. It is not in dispute that the plaintiffs had not paid
the said amount and the plaintiffs had therefore failed to comply
with clause ( c) of the agreement dated 16.3.2013.
24. The defendants had averred that on account of inaction of the
plaintiff, they had decided to allow the defendant nos.1 and 2 to
develop the said property. It was further averred that the public
notice dated 28.9.2014 was issued calling for objections. However,
the plaintiffs had not raised any objection as regards the said decision
of the defendant nos.3 to 12 to allow the defendant nos.1 and 2 to
develop the suit land. Subsequently, the defendant nos.1 and 2 and
the defendant nos.3 to 12 and the defendant no 13 entered into a
tripartite agreement dated 5.11.2014 in respect of the suit land. The
defendants had specifically averred that the plaintiff was present in
pps 16 of 19
AO 967-16
the office of CIDCO on the date of execution of the said tripartite
agreement and that he had submitted his objection before the CIDCO
regarding the execution of the said tripartite agreement. These
averments which are not specifically denied, prima facie reveal that
the plaintiffs were aware about the execution of the lease deed dated
21.5.2014 and the execution of the tripartite agreement dated
5.11.2014, despite which the plaintiff had not taken prompt action
against the defendants.
25. It is also to be noted that the plans were approved and
permission was granted by CIDCO on 7.10.2015. Upon obtaining
the said permission, the defendant started construction on the suit
land. It is stated that the construction has reached the plinth level
and the defendants have already entered into agreement with regard
to the flats which are to be constructed in the said land. There is no
specific denial of these averments. The records thus prima faice
indicate that the plaintiffs had approached the Court after
considerable delay. The learned Judge was therefore justified in
holding that the delay in approaching the Court as well as the
pps 17 of 19
AO 967-16
conduct of the plaintiffs would not justify grant of discretionary and
equitable relief.
26. At this stage it would be advantageous to refer to the decision
of the Apex Court in Wander Ltd. And Anr. vs Antox India P. Ltd
1990 SUPP (1)SCC 727 wherein the Apex Court has observed that
" 9. ....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 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
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AO 967-16
fact that the appellate court would have taken a different
view may not justify interference with the trial court's
exercise of discretion."
27. In the light of the above settled principles and considering the
facts and circumstances of the case, in my considered view, the
impugned order does not warrant any interference and hence the
appeal from order is hereby dismissed. However, in the light of the
statement made by the defendants nos.1 to 12, they are directed to
pay to the plaintiff or deposit before the trial court an amount of
Rs.54 lakhs with interest at the rate of 9% per annum from the date
of receipt of the amount till the date of deposit, which would be
without prejudice to the right to claim damages.
28. In view of disposal of the appeal, civil Application No. 967 of
2016 does not survive and the same is accordingly disposed of.
(ANUJA PRABHUDESSAI, J.)
pps 19 of 19
