Bombay High Court
Sony Pictures Networks India ... vs Ferani Developers And 8 Ors on 25 August, 2021
Bench: Nitin Jamdar, C.V. Bhadang
1-comap(l)-5736-21 & ors..doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
COMMERCIAL APPEAL (L) NO. 5736 OF 2021
IN
INTERIM APPLICATION (L) NO. 2545 OF 2021
IN
COMMERCIAL SUIT (L) NO. 2544 OF 2021
Sony Pictures Networks India Pvt. Ltd.
Company incorporated under the
Companies Act, 1956, and having its
registered office at 4th Floor, Interface
Building No.7, Off. Malad Link Road,
Malad (West), Mumbai - 400 064. ...Appellant/
Orig.Plaintiff
V/s.
1. Ferani Developers
(a division of Ferani Hotels Private Limited)
having its office at Construction House-B,
Second Floor, 623 Linking Road,
Opp. Khar Telephone Exchange,
Khar, Mumbai - 400 052.
2. K. Raheja Realty Private Limited
(Estate Manager of Defendant No.1)
having its office at Construction House-B,
Second Floor, 623 Linking Road,
Opp. Khar Telephone Exchange,
Khar, Mumbai - 400 052.
3. Rosette Leasing & Infotech Private Limited
having its office at Unit No.6, Ground
Floor, Kamath Industrial Estate,
Opp. Siddhi Vinayak Temple, Veer
Savarkar Road, Prabhadevi,
Mumbai - 400 025.
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4. Oak Leasing and Infotech Private Ltd.
having its office at Unit No.6, Ground
Floor, Kamath Industrial Estate,
Opp. Siddhi Vinayak Temple, Veer
Savarkar Road, Prabhadevi,
Mumbai - 400 025.
5. Upright Leasing & Infotech Private Limited
having its office at Unit No.6, Ground
Floor, Kamath Industrial Estate,
Opp. Siddhi Vinayak Temple, Veer
Savarkar Road, Prabhadevi,
Mumbai - 400 025.
6. Aditya Birla Finance Limited
R-Tech Park, Floor 10,
Nirlon Compound, Near Hub Mall,
Off. Western Express Highway,
Goregaon (East), Mumbai - 400 063.
7. Shyam Nandlal Wadhwani
Director of Defendant No.1.
304, Skylark, New Kantwadi Road,
Pali Hill, Bandra (West),
Mumbai - 400 050.
Email [email protected]
8. Durga Sandeep Raheja
Director of Defendant No.1.
Raheja Bay, Plot No.748,
Mount Mary Road, Bandra (West),
Mumbai - 400 050.
Email [email protected]
9. Mr. Sandeep Gopal Raheja
Director of Respondent No.1.
Raheja Bay, Plot No.748,
Mount Mary Road, Bandra (West),
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Mumbai - 400 050.
Email [email protected] ...Respondents/
Orig. Defendants
----
Mr. Rahul Narichania, Senior Advocate a/w. Mr. Anoshak Daver
a/w. Ms. Sapna Chaurasia a/w. Mr. Hamdan Wedon i/b. TMT
Law Practice, for the Appellant.
Mr. Karl Tamboly i/b. Ms. Madhu Hiraskar, for the Respondent
Nos.1, 2 and 7 to 9.
Mr. Shekhar Jagtap a/w. Ms. Sairuchita Chowdhary a/w. Mr.
Ninad Naik, for the Respondent Nos. 3 to 5.
Mr. Cyrus Ardeshir a/w. Ms. Nimisha Ghetla i/b. Katariya and
Associates, for Respondent No.6.
----
CORAM : NITIN JAMDAR AND
C. V. BHADANG, JJ.
DATE : 25 AUGUST 2021
JUDGMENT : (Per C. V. Bhadang, J.)
. By consent of parties, the Appeal is taken up for final
disposal.
2. By this Appeal under Section 13 of the Commercial Courts
Act, the Appellant (original Plaintiff) is challenging the order
dated 18 February 2021 passed by the learned Single Judge in
Interim Application (L) No.2545/2021 in Commercial Suit (L)
No.2544/2021. By the impugned order, the learned Single
Judge has directed restoration of the lift services to the demised
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premises subject to the Appellant paying a sum of
Rs.2,43,28,879/- to the first and the second Respondents. The
Appellant is aggrieved by the condition of deposit.
3. The brief facts necessary for the disposal of the Appeal,
which are mostly undisputed, are as under.
The first Respondent is the developer of Interface Building
No.7 (said building) situated at Malad (West), Mumbai. The
second Respondent is the Estate Manager of the first Respondent.
The Respondent Nos.3 to 5 are respectively the purchasers of
Unit No.201, 301 and 401 (demised premises) on the 2 nd, 3rd and
4th floor of the said building, under separate agreements of sale
dated 4 October 2005. The sixth Respondent is a Non Banking
Financial Company (NBFC) which has given financial assistance
to the Respondent Nos.3, 4 and 5. Respondent Nos.7 to 9 are
the Directors of the first Respondent.
4. The Appellant (Plaintiff) is a Company incorporated under
the Companies Act, 1956 and claims to be one of the leading
broadcasters in India and operates several channels including
Soni Max, Soni Max 2, Soni SAB amongst others. The Appellant
(formerly known as "Multi Screen Media Private Limited") has
obtained the demised premises on lease from the Respondent
Nos.3 to 5 under separate lease deeds dated 19 December 2014.
The Appellant has also entered into separate 'Amenity
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Agreements" of even date agreeing to pay the monthly amenity
charges in respect of the demised premises. The Appellant is
having its establishment in the demised premises, having several
employees working there. There are also visitors to the said
offices. The sixth Respondent had advanced loan to the
Defendant Nos.2, 3 and 5 under separate loan agreements dated
31 October 2014 alongwith three separate escrow agreements of
the even date. The demised premises are offered as security for
the said loan. Prior to the execution of the lease deeds, the
Respondent Nos.3 to 5 by their letter dated 19 November 2014
had asked the Appellant to deposit the lease rentals directly in the
Escrow Accounts.
5. It appears that proceedings were initiated against the
properties of the Respondent Nos.3 to 5, under the Prevention of
Money Laundering Act, 2002 and the demised premises came to
be attached as per the order passed by the Adjudicating
Authority. The sixth Respondent feeling aggrieved has
challenged the same before the Appellate Tribunal at New Delhi.
The Appellate Tribunal by order dated 27 July 2017 and 9
November 2017 had directed rentals from the Defendant Nos.3
and 4 to be deposited in separate accounts with DCB Bank Ltd.
Nariman Point Branch, Mumbai operated by the sixth
Respondent instead of the Escrow Accounts. The Appellate
Tribunal has also recorded an undertaking of the sixth
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Respondent to release the necessary amount towards the amenity
charges to the borrowers (Respondent Nos.3 to 5) from out of the
amount of EMI recovered. The sixth Respondent has also
undertaken before the Appellate Tribunal that in the event
Respondent is unable to succeed in the Appeal, it shall refund /
restitute all such amounts to the concerned authority.
6. The material dispute started when the Respondent Nos.3, 4
and 5 failed to pay the maintenance dues / amenity charges to the
first Respondent. The first Respondent by notice dated 10
December 2020 asked the Respondent Nos.3 to 5 to pay the
outstanding dues, failing which the essential services of the
demised premises would be discontinued. A copy of the said
notice was endorsed to the Appellant. The Appellant by their
notice dated 19 December 2020 called upon the Respondent
Nos.3 to 5 to forthwith pay the outstanding amount which did
not evoke any favourable response, as a result of which, the first
and the second respondent had discontinued the lift services of
the demised premises (only the 2nd , 3rd and 4th floor) on 29
December 2020.
7. The Plaintiff addressed a letter dated 30 December 2020 to
the first Respondent for restoration of the lift services and again
asked the Respondent Nos.3 to 5 to pay the maintenance /
amenity charges immediately. The first Respondent by their
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letter dated 31 December 2020 made it clear that the lift services
would be restored only upon receipt of the entire outstanding
amount of Rs.3.42 Crores.
8. On 6 January 2021 the parties came to an understanding,
under which the maintenance / amenity charges in respect of the
fourth floor (Unit No.401) belonging to Respondent No.5 was to
be paid by the Appellant to the first Respondent so that the lift
services could be restored. Said arrangement was recorded in an
Email dated 6 January 2021. Pursuant to this arrangement, the
Appellant transferred an amount of Rs.28,86,222/- to the
account of the first Respondent towards amenity charges for the
fourth floor unit. In pursuance thereof, the first and the second
Respondent restored the lift services on 12 January 2021. On 13
January 2021, the Appellant proposed a draft agreement with the
first Respondent for payment of dues which did not materialise
into a concluded agreement. On account of this, the lift services
were finally discontinued on 22 January 2021.
9. It is in these circumstances that the Appellant has filed the
aforesaid suit against the Respondents interalia for a direction to
the first and the second Respondent to restore the lift services and
further restraining them from discontinuance thereof.
10. The Respondent Nos.1, 2 and 7 to 9 have contended that
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the Appellant has no locus standi to file the suit as there is no
privity of contract between the Appellant and these Respondents.
It is contended that under separate Agreements for Sale dated 4
October 2005 between the first Respondent and the Respondent
Nos.3 to 5 in respect of the demised premises, the Respondent
Nos.3 to 5 have agreed to pay the amount of amenity charges on
monthly basis. It is pointed out that as per Clause 56(B) of the
said agreement, the first Respondent is entitled to withhold the
essential services in the event of a default in the matter of
payment of amenity charges continuously for three months. It is
contended that the Appellant as a Lessee of the Respondent
Nos.3 to 5 cannot have a higher superior right or privilege than
their Lessors. It is contended that admittedly the amenity charges
have not been paid by the Respondent Nos.3 to 5 and therefore,
no exception can be taken to the action of the Respondent Nos.1
and 2 in discontinuing the services.
11. It was also contended that the Appellant had filed a
complaint with the Inspector of Lifts, Government of
Maharashtra and Municipal Corporation of Greater Mumbai on
13 January 2021, alleging contravention of Section 10 of the
Maharashtra Lifts, Escalators and Moving Walks Act, 2017 and
therefore the suit is not maintainable as per Section 34 of the said
Act.
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12. It is necessary to note at this stage that before the learned
Single Judge the Appellant and the Respondent Nos. 1 to 9
(except Respondent No.6) had tendered Consent Terms agreeing
to settle the entire dispute as per the terms contained therein.
However, on account of the objection raised by the sixth
Respondent to Clause 4.2 of the Consent Terms, the Consent
Terms could not be acted upon.
13. The learned Single Judge has noticed that the Appellant is
not in default in either paying the lease rent or the amenity
charges for and on behalf of the Respondent Nos.3 to 5. The
learned Single Judge has also found that indisputably the
Respondent Nos.3 to 5 have 'grossly defaulted' in making
payment of the bills raised by the first Respondent towards the
amenity charges and the services provided to the demised
premises. Learned Single Judge has found and that it is in this
narrow compass that the issue arises as to whether the Appellant
is entitled to any ad-interim relief and if so on what terms and
conditions.
14. The learned Single Judge has found that there is no privity
of contract between the Appellant and the Respondent Nos.1 and
2 and the Appellant cannot claim any higher right than the
Respondent Nos.3 to 5 as the Appellant is only a Lessee of the
demised premises of which Respondent Nos.3 to 5 are the
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owners / Lessors. Learned Single Judge has accepted that under
the provisions of Maharashtra Ownership Flats (Regulation of the
Promotion of Construction, Sale, Management and Transfer) Act,
1963 (MOFA) as well as the Maharashtra Rent Control Act,
1999, lift services are a part of an essential service. Learned
Single Judge as then relied upon Clause 56(B) of the agreement
between the first Respondent and the Respondent Nos.3 to 5 to
find that default in the matter of payment of the outgoings, taxes,
amounts and/or other payments was to be deemed to be just and
reasonable cause for the first Respondent (Builder) under Section
12-A of the MOFA to cut off or withhold supply of essential
services enjoyed by the purchasers, till such time the entire
payment is made alongwith interest.
15. The learned Single Judge has also negatived the contention
on behalf of the Appellant that it is for the Court to decide as to
what is just and sufficient cause and not something for the parties
to agree upon.
16. The learned Single Judge has then went upon 'balancing
the equities' by recalculating the outstanding amount by applying
interest at the rate of 10% per annum instead of 21% per annum,
from July 2019. The learned Single Judge has arrived at a figure
of Rs.2,43,28,879/- (which was not disputed by the Respondent
Nos.1 and 2). In the face of these findings the learned Single
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Judge has directed restoration of the lift services, subject to
payment of the said amount to the Respondent Nos.1 and 2. In
so far as future rentals and amenty charges are concerned, the
same are directed to be deposited in the accounts with the DCB
Bank Ltd. operated by the Respondent No.6 ( in respect of Unit
No.201 and 301) and the Respondent No.6 is directed to forward
the amenity charges directly to the Respondent Nos.1 and 2. In
so far as Unit No.401 (which is not subject matter of the PMLA
proceedings) is concerned, they have been directed to be paid to
the Respondent Nos.1 nd 2 for and on behalf of the Respondent
No.5.
17. We have heard the learned counsel for the parties. The
parties have also filed written submissions. We have gone
through the same.
18. Mr. Narichania, learned Senior Advocate for the Appellant
has submitted that the Appellant has been making timely
payment under the indentures of lease and also the amenity
agreements and despite this, has suffered on account of the lapse
of the Respondent Nos.3 to 5 in making the payment to the first
Respondent. It is submitted that conditional order as passed by
the learned Single Judge takes care of the interest of all the
parties, except the Appellant, which is required to pay the amount
twice. It is submitted that the impugned order is in the nature of
granting a decree of recovery in favour of the first Respondent. It
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is submitted that the lift services are essential services within the
meaning of Section 29 of the Rent Act, and the landlord is under
obligation not to cut off or withhold the essential supply or
services. It is submitted that Explanation (b) to Section 29 would
show that any acts or omissions attributable to the landlord which
result into the discontinuance of the essential supply are well
within the meaning of Section 29. It is submitted that although
the Rent Act may not directly apply to the Appellant, the spirit of
Section 29 and the intention of the legislature in relation to
essential services is clear that such essential services cannot be
curtailed without just and sufficient cause. It is submitted that no
reliance can be placed on Clause 56(B) of the Agreement dated 4
October 2005 to hold that there was just and reasonable cause for
such discontinuance. It is submitted that equally the first
Respondent ought to be aware of Clause 8(D) and 9(A) of the
Indentures of lease under which the Lessor was liable to pay the
outgoings to the building society, failing which the Appellant /
Lessee was entitled to pay such amount on behalf of the Lessor to
the building society. It is submitted that the balance of
convenience lies in favour of the Appellant in as much as the
claim of the Appellant for restoration of an essential services is
pitted against the monetary claim of the Respondent Nos.1 and 2
against Respondent Nos.3 to 5.
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19. Reliance is placed on behalf of the Appellant on Section 10
of the Act of 2017 which reads thus-
Additions or alterations to life or escalator or
moving walk installation - No additions or
alterations, which cause any change in the
characteristics of lift or escalator or moving walk
like change in passenger capacity, speed, stops, steps
etc. or other than those required to be made under
Section 21, shall be made to any lift or escalator or
moving walk installation except with the prior
permission in writing of an Electrical Inspector
(Lifts).
It is thus submitted that Section 10 prohibits any addition
or alteration being made which includes 'stops' of the lift services
except with the prior permission in writing, of the Electrical
Inspector which is a statutory obligation on the Respondent
Nos.1 and 2 which would override any contractual terms.
20. On behalf of the Appellant, reliance is placed on the
decision of this Court in (i) J. Satyavrata and Anr. Vs.
Mohamedbhai Abdulhussein Sadiq Bahreinwalla and Ors. 1 (ii)
Kanaiyalal Chandulal Monim Vs. Indumati T. Potdar and Anr. 2
(iii) Balkrishna Dwivedi Vs. Municipal Corporation of Gr.
Mumbai & Ors.3 (iv) Tayawa Vs. Gurshidappa & Ors.4 and (v)
the decision of Supreme Court in Jabbar Sahib Vs. V. R. Renu
1AIR 1982 Bom 50
2AIR 1958 SC 444
32014 (4) Mh.L.J. 189
41990 SCC Online Bom 23
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alias Venugopal Naicker5
21. Mr. Tamboly, learned counsel for the Respondent Nos.1
and 2 has supported the impugned order. It is submitted that
there is no direction as such by the learned Single Judge to pay
the amount. Thus, the impugned order cannot be read as a
decree for recovery of the amount of the amenity charges in
favour of the Respondent Nos.1 and 2. Learned counsel pointed
out that the payment is a condition for restoration of the lift
services. It is submitted that there is no privity of contract
between the Appellant and the Respondent Nos.1 and 2. On
behalf of the Respondents, reliance is placed on Clause 41(a),
56(A) and 56(B) of the agreement of the year 2005 in order to
submit that in terms of the said agreement, the Appellant is
entitled to discontinue the essential services, in as much as the
default in the payment of the outgoings by the Respondent Nos.3
to 5 is deemed to be just and reasonable cause for the builders
under Section 12(A) of the MOFA to cut off or withhold any
essential supply or services. It is submitted that the Appellant as
Lessees and claiming through the Respondent Nos.3 to 5 cannot
have a higher right or privilege than their Lessors. That Section
12 of the MOFA also takes into its ambit an occupier. It is
submitted that the Appellant cannot claim relief, contrary to the
terms of contract, which in the submission of the learned counsel
would amount to rewriting of the contract between the parties. It
51963 SCC Online Mad 361
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is submitted that the Appellant has not sought any relief or
direction against Respondent Nos.3 to 5 to pay the amount. It is
submitted that the Appellant is seeking a mandatory relief at the
interim stage, which cannot be granted in the circumstances of
the case. It is submitted that there is no challenge to Clause (D)
of the operative order and there is no claim for adjustment of the
amount of Rs.28 Lakhs and odd. It is submitted that the
impugned order adequately takes care of the interest of the
parties. It is submitted that the pre-condition of payment of part
of the maintenance amount cannot cause any irreparable loss to
the Appellant, in as much as the Appellant can pursue its claim
for recovery of the said amount / damages against the Respondent
Nos.3, 4 and 5. Reliance is placed on the decision of the
Supreme Court in Best Sellers Retail (India) Private Limited Vs.
Aditya Birla Nuvo Limited and Ors. 6 in order to submit that any
loss which can be compensatory in terms of money is not an
irreparable loss. It is submitted that the parties had entered into
Consent Terms which could not be acted upon on account of the
objection by the Respondent No.6.
22. It is submitted that the Appellant has misused the interim
order dated 1 April 2021 in as much as there is a subsequent
default in the matter of payment of the amenity charges for the
month of April, May and June 2021. It is submitted that the
learned Single Judge has properly exercised the discretion by
6 (2012) 6 SCC 792
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balancing the rights and equities between the parties and in the
absence of the discretion being shown to be arbitrary no
interference is called for.
23. We have carefully considered the rival circumstances and
the submissions made. Notwithstanding the extensive narration
of facts and the rival submissions, the issue is essential about
restoration of an essential service as against the monetary claim
by the Respondent Nos.1 and 2 towards the amenity charges.
24. At the outset, it is necessary to note that the learned Single
Judge has also found that admittedly the Appellant was not in
default in either paying the lease rental or the amenity charges
and it is the Respondent Nos.3 to 5 who have 'grossly defaulted'
in making the payment of said amount to the Respondent Nos.1
and 2. Under the provisions of MOFA as well as the Rent Act,
lift services are part of the essential services. The learned Single
Judge has essentially relied upon Clause 56(B) of the agreement
of the year 2005, in holding that the non payment of the
outgoings, constitute just and reasonable cause for
discontinuance.
25. It is submitted on behalf of the Respondent Nos.1 and 2
that the Appellant ought to be aware of the terms and conditions
of the agreement of the year 2005 in as much as it is a registered
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agreement. On the contrary, it is submitted on behalf of the
Appellant that even the lease deeds of the year 2014 are registered
documents and therefore equally the Respondent Nos.1 and 2
ought to be aware of the terms of the lease deeds.
26. It is significant to note that the Respondent Nos.1 and 2
were indeed aware of the fact that the Appellant has obtained the
demised premises on lease and that is why a copy of the notice
dated 10 December 2020 was endorsed to the Appellant. On
behalf of the Appellant, reliance is placed on Clauses 8D and 9A
of the lease deeds. In order to appreciate the rival contentions, it
is necessary to reproduce the relevant clauses of the agreement of
the year 2005 and the lease deeds of the year 2014 as under.
Lease Deed dated 19 December 2014
8D - If the Lessor fails in its obligations to pay
municipal taxes to the Municipal Corporation of
Greater Mumbai ("MCGM") and/or the outgoings
to the Building Society, and if the Lessee has
received a notice of attachment or other
proceedings with respect to the Demised Premises
from MCGM due to such non payment of
municipal taxes and the Lessee reasonably
apprehends that as a result the Lessee may be
unable to enjoy free, unhindered and
unencumbered use and occupation of the Demised
Premises, the Lessee shall intimate the Lessor in
writing about such non payment of municipal taxes
or other proceedings and/or the outgoings to
MCGM or the Building Society as the case may be,
or specify the breach committed by the Lessor and
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shall give to the Lessor a thirty (30) day notice in
writing calling upon the Lessor to take corrective
steps to remedy the breach complained of in the
said notice. In the event that at the expiry of fifteen
(15) days after the receipt of such notice, the Lessor
fails to take corrective steps to rectify the breach
complained of in the said notice, then and in that
event (and or otherwise) the Lessee shall be entitled
to pay such amounts on behalf of the Lessor to
MCGM and/or the Building Society and/or to do
such acts as may be essential for enabling the Lessee
to use the said benefits as the case may be and to
deduct the amounts so expended by the Lessee on
behalf of the Lessor from the Rent payable by the
Lessee under this Lease Deed ; PROVIDED,
HOWEVER THAT before deducting such
amounts from the Rent the Lessee shall give proof
of such payments made by the Lessee to MCGM
and/or the Building Society and/or the amounts
expended by the Lessee for enabling the Lessee to
make use of the said benefits, as the case may be.
Without prejudice to the above, the Lessee may at
its option choose not to make such payments to the
MCGM or the Building Society and to terminate
this Lease Deed by giving thirty (30) days prior
written notice to the Lessor of its intention to
terminate the Lease and upon the expiry of such
thirty (30) days the Lease Deed shall ipso facto
automatically, shall stand revoked and determined
and the consequences of termination as stated in
Clauses 23A(a), (b), (c), (d) and (e), 24(a), (b), (c),
(d) and (e) and 25(a) and (b) herein shall follow,
Save and except in the eventualities expressly
provided herein, the Lessor shall not be entitled to
terminate this Lease Deed during the Term.
9A - Property and related taxes ("Property
Taxes") payable to MCGM and the outgoings
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payable to the Building Society in respect of the
Demised Premises shall be borne and paid by the
Lessor.
Agreement dated 4 October 2015
Clause 41(a)- The Purchaser shall from the date
hereof regularly pay to the Builders or pay every
month to the BMC / concerned authority, as the
case may be his/her/their/its proportionate monthly
share of property taxes, charges and rates or any
other local taxes, etc. in relation to the said Premises
Building No.16/Segment -1/ said property / larger
property as determined by the Builders on an ad-
hoc basis till such time as the taxes, charges and
rates are specifically known and thereafter as
determined by the Builders on the basis of the
actual taxes etc. being levied by the said
BMC/concerned authority from time to time. The
Purchaser in addition to the above further agrees
and binds himself / herself / themselves / itself to
pay regularly to the Builders until the Document/s
of Transfer in respect of the said Building No.7 /
Segment-1 / property / larger property is/are
executed as herein stated and thereafter to the Co-
operative Society / Limited / Company /
Organisation his/her/their/ its ad-hoc proportionate
monthly share towards outgoings for the
maintenance and management of the common
amenities, common lights/ electricity charges, water
charges and other outgoings such as administrative
charges, bill collection charges, charges for clerks,
watchmen, sweepers, gardeners and maintenance of
accounts, incurred / to be incurred in connection
with the said Building No.7/Segment -1/said
property and also in connection with the said larger
property (i.e. the common infrastructure services /
facilities / amenities etc. and the property taxes,
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charges and rates or any other local taxes etc.
relating thereto). The Builders may at their
discretion, even prior to the Document/s of
Transfer in respect of the said Building No.7/
Segment -1/ said property/ said larger property
being executed as stated herein, direct the Purchaser
(and other persons who purchase units and premises
in the said Building No.7) to pay to the said Co-
operative Society Limited Company /Organisation
the said contributions pertaining to the said
Building No.7 / property / Segment-1 which would
otherwise be payable to the Builders, in which event
the said Co-operative Society/ Limited Company /
Organisation shall be liable to bear the expenses
pertaining to the said purposes related to the said
Building No.7 / Segment -1/ said property.
Clause 56 (A) - Without prejudice to the liability of
the Purchaser to pay to the Builders interest on the
outstanding payment/s at the rate of 1.5% per
month for the delayed period, the Purchaser shall
cease to be entitled to the use (and Builders will in
such event be entitled to take appropriate steps to
stop the Purchaser from using) of the common areas
/ services / facilities / amenities till such time as
he/she / they / it makes payments of the said
amounts and deposits together with interest
thereon.
56(B) - In the event of the Purchaser making any
default in the payment of the outgoings, taxes,
amounts and/or other payments payable under the
terms and conditions of this Agreement for three
months and in the event of the default continuing
even after the Builders giving fifteen days notice in
writing to the Purchaser, calling for the payments to
be made by the Purchaser, should default, shall be
deemed to be just and reasonable cause for the
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Builders under Section 12A of the Maharashtra
Ownership Flats (Regulation of the Promotion of
Construction, Sale, Management and Transfer) Act,
1963 to cut off or withhold any essential supply of
service enjoyed by the Purchaser in respect of the
said premises, till such time as he/she/ they/it makes
payments of the said amounts together with interest
thereon.
27. It can thus be seen that as per Clause 9A the outgoings
payable to the building society in respect of the demised premises
were to be borne by the Respondent Nos.3 to 5 (the Lessors). As
per Clause 8D if the Lessors failed in their obligation to pay the
outgoings to the building society, the Appellant as Lessee are
entitled to pay such amounts on behalf of the Lessors to the
building society and/or to do such acts as may be essential for
enabling the Lessee to use the said benefits and to deduct the
amounts so expended from the rent payable.
28. As per Clause 56(A), the Respondent Nos.1 and 2 apart
from being entitled to interest on the outstanding payments at
the rate of 1.5% per month for the delayed period were also
entitled to take appropriate steps to stop the "Purchasers"
(Respondent Nos.3 to 5) from using the common areas /
services / facilities / amenity till such time that the payment is
made alongwith interest. As per Clause 56(B), such a default in
the matter of payment of the outgoings by the 'Purchaser' shall be
deemed to be just and reasonable cause for the Builders under
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Section 12A of the MOFA to cut off or withhold any essential
supply of service enjoyed by the 'Purchaser' in respect of the said
premises, till such time that the payment is made alongwith
interest.
29. It is submitted on behalf of the Appellant that had the
Respondent Nos.1 and 2 immediately taken action for the default
the Appellant could have paid the amenity charges after
deducting the same from the rental amount as agreed in Clause
8D of the lease agreement of the year 2014. It is submitted that
however the Respondent Nos.1 and 2 did not take action
immediately and allowed the interest to mount. Learned Senior
counsel for the Appellant has referred to the annexures to the
letter dated 10 December 2020 in order to point out the
difference in the amount which is now claimed by the
Respondent Nos.1 and 2 on account of the accrual of the interest.
For instance, in respect of the Unit No.201, the amount claimed
is shown to be approximately nine times while in respect of Unit
No.301 it is thirteen times of the amount due and in respect of
401, it is approximately ten times the amount due. It is
submitted that the Respondent Nos.1 and 2 were happy earning
interest at the rate of 18% per annum on the amount of the
arrears of the amenity charges.
30. In our considered view, the action of the discontinuance of
the lift services is in the nature of a penal action and we find it to
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be highly unjust as against the Appellant particularly when the
Appellant has been found to have paid the amenity charges and it
is the Respondent Nos.3 to 5 who had defaulted in the matter of
payment of said charges to the Respondent Nos. 1 and 2. We
find that the Appellant cannot be made to pay the amount twice
at the pain of the discontinuance of the essential services. In our
considered view, the Appellant cannot be coerced to make the
payment twice or else to suffer the discontinuance of the essential
services. It is significant to note that the Respondent Nos.1 and 2
had not taken any action against Respondent Nos.3 to 5 for
recovery of the amenity charges. Having regard to the fact that
the Appellant had already paid the amount of amenity charges to
the Lessors, we find that there is a strong prima facie case in
favour of the Appellant for grant of the relief of restoration of the
lift services. We also note that prima facie Section 10 of the Act
of 2017 would show that the lift services could not be tinkered
with, including change of the stops, without the permission in
writing of the electrical inspector, which is to ensure the safety of
all the users of the lift. In so far as balance of convenience is
concerned, we find that the lift services to the said building are in
operation and all that Respondent Nos.1 and 2 have done is to
discontinue the stops on second, third and fourth floor of the said
building. Thus, the contention on behalf of the Respondent
Nos.1 and 2 that they cannot be made to incur expenses for
operating the lift when they have not been paid the amenity
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charges to our mind cannot be accepted, in as much as no
additional expenses need to be incurred for merely allowing the
stops of the lift on the three floors. As noticed earlier, essentially
the claim of the Respondent Nos.1 and 2 is a monetary claim,
against the Respondent Nos.3 to 5 for recovery of the amenity
charges. Thus, the Respondents cannot be said to suffer any
irreparable loss by restoration of the lift services (see the decision
of the Supreme Court in Best Seller ). It is necessary to note
that in a Metropolis like Mumbai people travel long distances and
unavailability of lift services to a multi storeyed building or a part
thereof particularly in the wake of the Pandemic conditions
would result into severe prejudice and inconvenience which
cannot be assessed or compensated in terms of money. The issue
is about the health and safety of the occupants and the visitors to
the demised premises.
31. Thus, even on the consideration of irreparable loss and
balance of convenience the Appellant is entitled to restoration of
the lift services without being bound by the condition of the
payment of the amenity charges all over again. We also find that
no reliance can be placed on the Consent Terms (as has been
done in Clause 'E' of the impugned order) when the Consent
Terms have not been acted upon on account of the objection
taken by the sixth Respondent.
7 (2012) 6 SCC 792
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32. We had directed the restoration of the lift services by order
dated 1 April 2021. We find that the Appellant can be directed
to deposit the amenity charges on and from 1 April 2021 before
this Court, which can be permitted to be withdrawn by the
Respondent Nos.1 and 2.
33. In the result, the following order is passed.
ORDER
1. The Appeal is partly allowed.
2. The part of the impugned order requiring
the Appellant to pay the amount of
Rs.2,43,28,879/-, to the Respondent Nos. 1and 2,
as a condition for restoration of the lift services, is
hereby set aside.
3. The Respondent Nos.1 and 2 or anybody
acting on their behalf, are hereby restrained from
discontinuing the lift services to the demised
premises, pending the disposal of the suit, subject to
the Appellant depositing the amenity charges for the
Unit No.201, 301 and 401 before this Court from 1
April 2021.
4. The arrears of the charges from April 2021
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to August 2021, shall be deposited on or before 30
August 2021.
5. The amenity charges from September 2021
shall be deposited every month on or before 10 th of
each English Calender month.
6. The Respondent Nos.1 and 2 would be
entitled to withdraw the amount so deposited before
this Court.
7. As the amenity charges are to be deposited
before this Court, it is open to the sixth Respondent,
to rely on this order, in case any grievance is made
that it has breached its undertaking furnished before
the Appellate Tribunal / PMLA regarding releasing
the amenity charges to the Respondent Nos.3 to 5.
8. The Appeal is disposed of in the aforesaid
terms.
(C. V. BHADANG, J.) (NITIN JAMDAR, J.)
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