Kash Foods Pvt. Ltd. And 3 Ors vs Omkar Realtors And Developers ...
2021 Latest Caselaw 226 Bom

          IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                ORDINARY ORIGINAL CIVIL JURISDICTION


               INTERIM APPLICATION (L) NO.3557 OF 2020
                            ALONG WITH
               INTERIM APPLICATION (L) NO.3559 OF 2020
                            ALONG WITH
                CHAMBER SUMMONS (L) NO.824 OF 2019
                                  IN
  COMMERCIAL EXECUTION APPLICATION (L)NO.1268 OF 2019


Kash Foods Pvt.Ltd. & Ors.              .. Applicants/Claimants
         Vs.
Omkar Realtors & Developers Pvt.Ltd.          .. Respondent


Mr. Haresh Jagtiani, Sr. Advocate, a/w Mr. Sharan Jagtiani, Sr.
Advocate, a/w Ms. Bhumika Chulani & Ms. Bhavi Vora i/b.
Siddhesh Bhole for the applicant.

Mr. Mayur Khandeparkar a/w Jamshed a/w H. Diamondwala
i/b. Diamondwala & Co. for the respondent.


                                  CORAM : A. K. MENON, J.

DATED : 6TH JANUARY, 2021.

P.C. :

1. The applicants are proceeding in execution of consent

award passed by a sole arbitrator. The applicants are the

claimants in arbitration. Three separate applications seek

Chsl-824-19 wadhwa the diverse reliefs against the sole respondent. In the

Chamber Summons of several reliefs, the applicants have

now restricted their claim to prayer clauses j (i) & (ii) and

prayer clause k(ii) restricted to unsold units in Tower C.

2. In application no.3557 of 2020, the applicant seeks a

temporary injunction restraining the respondent, its

servants and agents from alienating, creating third party

rights or transferring development rights granted to

respondent under a development agreement dated 13 th

April, 2013 without prior approval of the applicants. The

applicants also seek an order directing the respondent to

disclose (a) Minutes of Meetings held on 30 th August,

2020 between respondent and its lead investors and third

parties in relation to the project known as Omkar 1973

at Worli; (b) details and information about any

transaction entered into by the respondent and any third

party in relation to transfer of its development rights in

the project and (c) details and information entered into

between the respondent and third parties in relation to the

said project.

Chsl-824-19 wadhwa

3. In the third proceeding, Interim application no.3559 of

2019, the applicants seek an order directing the

respondent to pay a sum of Rs.71,09,820/- p.m. to the

applicants under clause 21 of the consent terms between

the parties till the applicants are handed over the agreed

and allocated constructed premises described as "Modified

Owners' Allocation."

4. According to the applicants, based on the respondent's

calculation in accordance with clause 21, monthly rent of

Rs.71,09,820/- is payable to the applicants. As of August

2020, the total outstanding is Rs.12,53,37,885/-. The

respondent is liable to pay the monthly sums under the

Award until the entire Modified Owners' Allocation is

handed over, monthly rent would have to be paid. Some

demand drafts were handed over in part payment of rent

but these were not encashed since the rent was not

tendered in full.

5. Pursuant to breaches of the development agreements, the

claimant/applicants had filed a petition under Section 9 of

Chsl-824-19 wadhwa the Arbitration and Conciliation Act which the Court

converted to one under Section 17 before the Arbitrator.

That application came to be allowed and the respondent

was restrained from parting with possession of any units

till handing over of the Owners' Allocation. The parties

thereafter entered into negotiations and consent terms

were arrived at thereby the restraint under Section 17 was

relaxed, partially vacated on the promise of timely

completion of Owners' Allocation and payment of certain

monetary consideration. Monetary consideration in a

substantial sum has been paid but the rent promised is

still outstanding.

6. On behalf of the applicants, Mr. Jagtiani submitted that

the applicant nos.1, 2 & 3 are owners of the land upon

which the project is being constructed and had entered

into a Development Agreement with the respondent. The

project contemplates construction of three towers A, B &

C. The applicant no.4 though not a party to the

development agreement, is a beneficiary under the

consent terms dated 3rd October, 2018 which led to the

Chsl-824-19 wadhwa passing of a consent award. The non-monetary

obligations of the respondent was to provide the

applicants all 5 flats on the 69 th floor of Tower A, one flat

on the 30th floor of Tower A, two duplex flats on 66 th and

67th floor of Tower B and flats no.4801, 4802, 4901 and

4902 in Tower B. These were required to be completed

and handed over in a time bound fashion. Mr. Jagtiani

submitted that the respondent had committed breach of

all the undertakings to hand over flats in question. He

relied upon a list of breaches. According to him the

respondents had committed breach of the Clauses 10(ii),

11(ii), 12, 13(ii) (iv) 14(i)(iv) and 21 of the consent

Award.

7. The respondent was required to get plans amended by

15th November, 2018 and register supplemental

agreements in relation to floor nos.66th and 67th which it

failed to do and thus defaulted in constructing /handing

over duplex flat on floor nos.66th and 67th along with

nine car parking spaces.

(ii) It breached clause 12 which required completion of

interior work and providing flat nos.B-4801, 4802, 4901,

Chsl-824-19 wadhwa 4902. These works were required to be completed by 31 st

January, 2019.

(iii) 5 flats which were permitted to be used by the

respondent had not been handed over back to the

applicant,

(iv) The lift installed was not upto floor 69.

(v) In respect of 5 flats on floor 69 th and the additional

flat on floor 30th of Tower A, agreements were to be

registered but agreements for only flat no.A-6901 and A-

3001 have been registered on 15 th July, 2019. The

registration in respect of other flats is pending because the

respondent now expects the applicant to pay stamp duty

and registration charges.

(vi) The respondent has defaulted on payment of rent and

in paying sum of Rs.20 crores against the adjustable

deposit.

8. In the Chamber Summons, the applicants have pressed for

relief in terms of prayer clause j(i) and j(ii) and prayer

clause k(ii). Mr. Jagtiani submitted that the respondent

was also bound to disclose (a) a list of unsold flats on the

Chsl-824-19 wadhwa part of the respondents allocation in Tower A, B & C; (b) a

list of assets held by the respondent over which the

respondent had power of disposal; (c) the stage of

approvals of duplex flats from SRA and MCGM supported

by copies of the plans and documents; (d) confirmation

that the respondent had not handed over possession of

flats on the 67th, 68th and 69th floor of Tower A excluding

flat nos.6701 and 6802 in Tower A of its purchasers.

9. Mr. Jagtiani submitted that under Order 21 Rule 32 a

decree for specific performance can be enforced by the

attachment of the property or with leave of the Court by

detaining Directors and Principal Officers of the

respondent in civil prison. According to him, it was

necessary to pass appropriate orders to enforce the decree

by directing detention as aforesaid. Under sub-rule (2) he

submitted that decree should be enforced by the

attachment of the property of the respondent in

complying with the award and would justify orders for

attachment and sale of property. He submitted that there

is willful default on the part of the respondent. Despite

giving undertakings each one has been violated. He,

Chsl-824-19 wadhwa however, admitted that a sum of Rs.230 crores has been

paid by the respondent as a pre-condition of the consent

terms but thereafter all other undertakings have been

breached willfully. He submitted that the respondent was

bound to obtain approval of plans by the SRA in respect of

duplex flats on the 66th and 67th floors of Tower A by 15 th

November, 2018 but had filed an application only after

December 2018.

10. It is contended that the respondent had benefited

immensely after being relieved of the injunction and

being permitted to handover possession of its allocation to

third parties and able to generate cash flows. He

therefore seeks attachment of unsold units of Tower C. He

referred to breach of clause 29 of the consent terms

relating to the insolvency proceedings and that an

attachment under Order 21 Rule 32(i) must extend to the

respondent's properties including unsold units. Despite

an order of this Court dated 27 th February 2020 directing

disclosure of unsold units he submitted that the disclosure

was selective and the respondent had not provided list of

unsold units but only stated that 6,70,000 sq. ft. had been

Chsl-824-19 wadhwa encumbered.

11. In relation to interim application no.3557 of 2020

in which the applicants seek an injunction restraining

transfer of development rights, Mr. Jagtiani submits that

in August 2020, the applicants came to learn that the

respondent had meetings with some investors thereby

leading the applicant to believe that the respondent was in

process of transferring development rights to a third party

without consent of the applicants. That such action is

breach of the development agreement. Mr. Jagtiani

submits that the applicants learnt of an order dated 7 th

August, 2020 passed in proceedings initiated against the

respondent by Shapoorji Pallonji Investment Advisors Pvt.

Ltd. It recorded that a board meeting of two lenders viz.

Piramal and Yes Bank was scheduled to be held on 30 th

August, 2020. In another proceedings in Commercial Suit

No.78 of 2016 also the Advocate contend that they were

awaiting lenders response to restructuring proposal that

the respondent cannot part with development rights

without the applicants prior approval and all the

Chsl-824-19 wadhwa aforesaid meetings indicated the intention of respondent

to part with development rights.

12. In Interim Application No.3559 of 2020 in which

the applicants seek recovery of rent pursuant to clause 21

of the consent terms. Mr. Jagtiani submitted that the

default in payment of rent is admitted and in the affidavit

of the respondent, it has undertaken to pay 4% rent as per

clause 21 of the consent terms. In a subsequent additional

affidavit dated 8th September, 2020 the respondent has

undertaken to pay the rent, but they are in default of

payment of Rs.12,53,37,885/- upto August 2020 and

further amounts of Rs.71,09,820/- p.m. till the Modified

Owners' Allocation is handed over. He submitted that the

applicants would give credit sum of Rs.50 lakhs to the

respondents since the applicants have encashed the

demand drafts amounting to Rs.50 lakhs sent to them on

28th August, 2019. As a matter of protest, some demand

drafts of Rs.24,81,285/- had not been deposited since rent

payable upto December 2019 was not being paid in full

and as of 31st October, 2020 Mr. Jagtiani contended that a

Chsl-824-19 wadhwa total sum of Rs.13,45,57525/- was overdue.

13. According to Mr. Jagtiani, vide clause 28 of the

consent terms, the respondent had agreed that all

obligations to the extent that they had not been modified

under the consent terms would continue to bind the

respondent and in such circumstances, the development

rights cannot be dealt with. The respondent was therefore

bound not to create third party rights. According to the

respondent however clause 19 and 28 of the consent

terms, the requirements under clause 26 of the

development agreement is no longer binding and

therefore the respondent does not require clearance from

the applicants for development of Tower C which

according to the respondent can be dealt with and

without reference to the applicants, the respondent's

contention being that certain bank guarantees had been

provided against which the applicants agreed to give up

securities for the top most three floors of Tower C.

According to Mr. Jagtiani the clause is not omnibus clause

allowing the respondent to transfer the development

Chsl-824-19 wadhwa rights of the project itself but only permits the respondent

to construct and deal with by way of sale, flats in Tower C.

He therefore submitted that transfer of all development

rights is not permissible without the prior approval of the

applicant.

14. As far as the Reserved Area B is concerned, Mr.

Jagtiani submitted that the respondent's contentions are

misleading that the monetary value of Reserved Area

consisting of six flats in Tower B can be equated only with

part of the Modified Owners' Allocation i.e. 5 flats on the

69th floor of tower A. He submitted that Reserved Area B is

insufficient. Secondly, the respondent's contention that it

has not been able to construct the apartments since

permissions are awaited is unacceptable because they

applied for approval only in December 2018 by which

time they should have obtained approvals as evident from

the additional affidavit of Kamal Gupta. The respondent

was not therefore diligently pursuing the permissions and

had not followed up with the authorities to obtain

approvals.

Chsl-824-19 wadhwa

15. As far as the interior work of flats for B-4801,

4802, 4901 and 4902 is concerned, the respondent has

contended that certain material had to be ordered from

abroad. To this, Mr. Jagtiani submitted that the

respondent was to complete interior work by 31 st January,

2019 yet none of the interiors were completed and the

reasons given were unacceptable. It is difficult to believe

that material imports were delayed by more than a year.

He also submitted that the other reason for non-payment

of rent is due to the pandemic which is once again not

believable.

16. On behalf of the respondent, Mr. Khandeparkar

contended that the applicants were the original owners of

a non-slum plot. Respondent as a developer is also a co-

owner in implementation of the project Omkar 1973 on

an adjoining plot. Joint Development was proposed of

several other plots. The SRA scheme were sought to be

combined by amalgamation and was intended to be

developed as a single plot. The applicants plot being land

locked could not be developed independently and hence

Chsl-824-19 wadhwa the applicants entered into the development agreement

dated 13th April, 2013. Disputes thereafter arose which

were resolved vide the consent terms. He submitted that

Rs.230 crores had already been paid over pursuant to

which the applicant consented with 27% share in the

applicants plot. This payment was made in October 2018

thus the respondent claims to be co-owner with the

applicant in relation to the applicants plot. He submitted

that the claim of Rs.20 crores under clause 10(ii) of the

consent terms has already been paid by adjustment as

already set out in its affidavit dated 25 th July, 2019 in the

Chamber Summons. This need not detain us since Mr.

Jagtiani has restricted his reliefs in the Chamber Summons

to prayer clause (j) (i) and (ii) and K(ii).

17. Mr. Khandeparkar submitted that in Tower A and

he has already disclosed that 64 flats are unsold and are

encumbered and in Tower C, 6,70,000 sq. ft. of unsold

area has been mortgaged. He admitted to liquidity

problems but reiterated that in the process of

restructuring the respondent will honour its obligations to

Chsl-824-19 wadhwa the applicant in respect of the 5 flats 6901 to 6905

applicants had taken possession and permitted the

respondent to use the units to complete the construction

of the higher floors and to complete the amenities cost of

which is about Rs.4 crores. He submitted that occupation

certificates for the said flats have been already obtained.

In respect of duplex flats on floor 66 th and 67th in Tower

approval of the modified floor plan layout is to be

obtained from SRA. Regularization has been sought but

the issues are still not resolved on account of lack of

clarity in implementing DCPR-2034. The respondent is

ready to execute agreements upon approvals being

granted.

18. As far as flat nos.B-4801, 4802, 4901 and 4902 are

concerned, Occupation Certificates have been already

handed over along with possession to the applicants and

the relevant agreements have been executed and

registered. He submitted that in respect of flat nos. 6901

to 6905 and 3001 the respondent is ready and willing to

share draft agreements and later enter into supplemental

agreements, copies of which have been shared.

Chsl-824-19 wadhwa

19. According to Mr. Khandeparkar the respondent has

complied with 93% of all obligations under the consent

terms and is making efforts to willfully comply with the

rest. Rent of Rs.13 crores is admittedly outstanding and

the cost of interior work to be carried out in flats 6901 to

6905 is about 4 crores whereas the applicant is secured to

the extent of Rs.129.29 crores. The liquidity issues

prevent them from undertaking interior work and the

respondent has suggested that the Reserved Area can be

sold and funds from those sales could be used for funding

the interior work in terms of the consent terms. The

monetary claim being entirely secured with a minimum

value of Rs.129.29 crores of 6 flats constituting the

Reserved Area and therefore no relief should be granted in

the Chamber Summons.

20. As far as the interim application no.3557 of 2020 is

concerned, Mr. Khandeparkar submitted that two floors

remained to be constructed in Tower A. Tower B has been

partly completed upto 69th floor. Occupation Certificates

Chsl-824-19 wadhwa are awaited only for floors 61 to 69. As far as tower C is

concerned, it is partly constructed upto the slab of 48 th

floor. According to him, the applicants have no right over

Tower C and no consent is required. Applicant no.3 is

said to have already sold 27% share to the respondent and

cannot seek such injunctions. The consent terms he

submitted provides in clause 28 that in any event of any

conflict between the development agreement and the

consent terms, the consent terms would prevail. This

Court as an Executing Court cannot go behind the decree

and grant relief contrary to the decree. The attempt of the

applicants is to seek injunction to pressurize the

respondent. Mr. Khandeparkar submitted that there has

been in-principle agreement for restructuring the debts of

the respondent and the respondent is awaiting the final

term sheet from the lenders.

21. In Interim Application no.3559 of 2020 the prayer

merely seeks a direction to pay the amount. No such relief

can be granted in execution proceedings since the

respondent has already admitted liability. The award is

being executed and no further orders are required to be

Chsl-824-19 wadhwa passed. According to Mr. Khandeparkar the applicants

are completely secured by clause 23(a) read with

Annexure VI of the consent terms and six flats having

market value of Rs.129 crores have been reserved for the

benefit of the applicants. A proposal made to the

respondent to sell these flats to recover monies has been

declined. It is further contended that the Execution

Application having been filed for recovery of only an

amount of Rs.77,56,984/- which Rs.74,81,285/- was

already been paid over. He therefore submitted that the

contents of the applicants cannot be accepted.

22. In conclusion, Mr. Khandeparkar submits that these

obligations under the consent terms clause 11(ii), 13(i),

13(ii) and 13(iv) are being complied, SRA approvals are

awaited on amended plans, interior works are yet to be

completed for reasons already set out and the

supplemental agreement remained to be signed. As far as

clause 12 of the consent terms is concerned, all

occupation certificates for flat B-4801, 4802, 4901 and

4902 along with 18 car parking spaces, possession have

been handed over but interior works remain to be

Chsl-824-19 wadhwa completed. Amenities and finishing work in flat nos.A-

6901 to 6905 were pending. Supplemental agreements

have to be registered in respect of one flat 6901. Interior

work of all 5 flats is yet to be completed and agreements

for four flats have been delivered for signature and

registration is to be completed. With reference to clause

14(ii) of the consent terms, flat no.A-3001 has already

been handed over within time and the supplemental

agreement is to be registered. As far as requirement of

obtaining NOC from mortgagees is concerned, for flats A-

3001, A-6901, B-4801, B-4802, B-4903 and 4902

NOCs have been furnished, NOCs for flats A-6902, 6903

and 6904 are in the process of being obtained. Clause 18

of the consent terms has been complied with. Clause 21

remains to be complied. As far as clause 23(a) is

concerned, flat nos.B-3702, 1801, 1703, 1803, 2203 and

2303 are reserved for the applicants and will be

maintained so till possession of all flats are completed.

Since the flats are already reserved, the obligations under

clause 23 have been complied. Mr. Khandeparkar

submitted that any transaction dealing with immovable

Chsl-824-19 wadhwa property would have the effect of extinguish title

possession or the right to possess, such property to deal

with which would have to dealings with to business and

the expression "deal with" would mean the right to enter

into any kind of transaction. He therefore submitted that

the respondent was entitled to sell, dispose of flats without

reference to the applicants.

23. Mr. Jagtiani submitted in rejoinder that the

opposition during submissions to payment of rent despite

a clear undertaking to pay the rent is obviously an

afterthought. He submitted that the Reserved Area B is not

sufficient to meet the liability under the consent terms.

The respondent had calculated the amount of rent payable

and was bound to honor the same. The obligation to pay

rent was independent and unconditional and was binding

till handover of the modified Owners' Allocation under

the consent terms. Reserved Area B was only to be held as

security till possession of the entire Owners Allocation is

handed over. He made reference to clause 22 of the

development agreement in support of his contentions and

Chsl-824-19 wadhwa submitted that there is no question of sale of that area. The

Reserved Area what to be retained till possession of the

flats to be provided to the applicants are handed over.

Therefore the Reserved Area cannot be sold. He submitted

that in relation to duplex 466 and 467 of tower B the

respondent had contended that Occupation Certificate

had been received upto 60th floors. Part Occupation

Certificate was obtained only upto 60 floors. According to

Mr. Jagtiani the obligation to procure approvals of plans

for construction of duplex on floor 66 and 67 had not

been complied with. As regards the contention that the

Reserved Area B covers the amount sought to be recovered

under execution, it is contended that a total of 50,396 sq.

ft. across 12 units was to be handed over of which 47760

sq.ft. still remains to be delivered. Although possession

letters for four flats two each on 4801, 4802, 4901 and

4902 possession had not been handed over because

interior work was not completed. There is admitted

default in delivering possession an area of 47.750 sq.ft.

owners reserved area is admeasuring 23.389 sq. fts all of

which are on lower floors. Mr. Jagtiani denied that the

Chsl-824-19 wadhwa value of the Reserved Area is 129.29 crores and denied

that the value of the applicants entitlement is above 275

crores and therefore the Reserved Area is not adequate

security. Moreover, the Reserved Area has to be

maintained since no Occupation Certificate has been

issued for the duplex flat and the other units are not ready

for possession since interior work remains to be carried

out. In view of continuing of a breach of the decree which

is for first specific performance, the reliefs for injunction

are liable to be allowed.

24. I have heard learned counsel at length. In reply to

the Chamber Summons, an affidavit dated 25 th July, 2019

of one Paras Pathak and an additional affidavits of

Bhanupratap Singh and one Kamal K. Gupta dated 19 th

September, 2020 on behalf of the respondent are on

record.

25. In the affidavit of Paras Pathak dated 25 th July 2020,

the deponent has denied the applicants contentions and

reiterates that the consent terms have been acted upon.

Non-monetary elements setting out the stages of

Chsl-824-19 wadhwa completion of work with reference to the approvals by

MCGM and SRA have been complied with and that

Occupation Certificates have been obtained in respect of

flats mentioned therein. Completion of pending interior

work and other obligations is underway. In the

meantime, respondent is willing to pay additional rent at

4% p.a. till the date of handing over the flats. The

respondent has not denied liability to pay rent at any time

and are willing to pay rent. A flat-wise breakup was also

provided.

26. It is contended that the application is a pressure

tactic and that the consent terms upon bank guarantees

being provided, the claimants were to relinquish their

rights in the top three floors of Tower C and the

respondent was giving their absolute discretion. The bank

guarantees are reportedly handed over and therefore the

applicants cannot claim any relief as against Tower C.

The deponent admits that respondent has been facing a

liquidity crunch due to poor performance of the realty

sector, however, they have held various discussions with

their lenders in order to restructure their outstanding

Chsl-824-19 wadhwa loans and once the restructuring of debts is finalized, the

respondent will be able to honour its commitment to the

claimant. As of 19th September, 2020, the respondent has

not relinquished control over the project to any third

party and the respondent is awaiting the final term sheets

and offer letter from the lenders. As regards Towers A &

B are concerned, Occupation Certificates upto the 69 th

and 60th floor were obtained and therefore the question of

relinquishing the control of the said project to a third

party does not arise.

27. According to the respondent, the applicants are

adequately protected and the balance of convenience

favours them. According to the deponent, consent terms

provide for retention of an area described as 'Reserved

Area B' as security and temporary injunctions cannot be

sought in execution proceedings. The premises mentioned

in Reserved Area B adequately covers the amount sought

to be recovered and if any restraint order is passed, it will

cause great prejudice to the respondent. It is further

stated that unsold inventory in Tower A, B & C has been

mortgaged to various lenders and therefore third party

Chsl-824-19 wadhwa rights have already been created. It is also stated that the

disclosures sought are confidential and are not required to

be provided.

28. The respondent admits that by reason of default,

rent is payable under the consent Award and reaffirms

that the respondent is making all efforts to restructure

their loans and make payments. The respondent has

offered to sell flats acquired in the reserved area and

recover the amounts due to the applicants but the

applicants have refused to agree. In the additional

affidavit all particulars have been disclosed by the

respondent as directed by the Court and therefore, the

applicants are sufficiently protected. The balance of

convenience is not in favour of the applicants. Substantial

compliance with the consent terms and the Reserved Area

B under the consent terms offers sufficient security.

29. In a rejoinder affidavit filed by applicant no.2 dated

2nd August, 2019 it is contended that the respondent has

violated consent terms since they have admitted that

compliance with non-monetary obligations is delayed.

Chsl-824-19 wadhwa The contentions of the respondent are denied. The

obligation under Clause 21 is reiterated in paragraph 2 of

the application and it is reiterated that the applicants are

entitled to default rent as per clause 21 of the consent

terms.

30. An additional affidavit has been filed on behalf of

the applicants vide dated 29 th January, 2020 disclosing

that several proceedings have been filed against the

respondent in NCLT Mumbai. These have not been

disclosed in prior proceedings in Arbitration despite

clause 21 of the award providing that the respondent and

its Director would inform the applicants in writing about

the pendency of liquidation or winding up proceedings

under the Insolvency and Bankruptcy Code. In the

additional affidavit of one Bhanupratap Singh dated 26 th

February, 2020 the deponent has disclosed proceedings

before the NCLT. It is in this background that the

aforesaid applications have to be considered.

31. Out of three applications that have been urged, I

am of the view that there is no merit in interim

Chsl-824-19 wadhwa application no.3559 of 2020. Clause 21 of the consent

terms reads as follows;

"Clause 21 - In the event the construction of the Owners' Allocation (as set out in Annexure-II hereto) is not completed or Occupation Certificate(s) in respect thereof from SRA/MCGM is not received within the Completion Period mentioned herein in that event the respondent shall pay to the respective claimants and the respective claimants shall be entitled to receive from the respondent, a further sum equivalent to ongoing market rental of the flats in question, from the scheduled date of completion thereof mentioned herein till the actual date of completion and handover to respective claimant with Occupation Certificate, water, electricity along with amenities as stipulated herein whereby the claimants in turn are able to fulfill their obligations towards purchasers of premises from them, subject to and without prejudice to the other rights and remedies which may be available to the claimants. The ongoing market rental shall be computed at 4% p.a. of Ready Reckoner value of flats as per ASR and which shall be payable every month."

32. The respondent has not and indeed cannot dispute

their obligation to make payments since it is not the case

of the respondents that the construction of the Owners'

Allocation has been completed or that Occupation

Chsl-824-19 wadhwa Certificate has been obtained from SRA/MCGM within the

completion period. The respondent is in my view, bound

to comply with the Award and make payments of the

amounts computed in terms of clause 21. The obligations

of the respondent under clause 21 remained to be

complied with as evident from the affidavit of Paras

Pathak dated 25th July, 2019 filed in reply to the Chamber

Summons. The question is when compliance will be

complete. In the event of non-compliance, the overdue

amounts claimed under clause 21 may attract interest. In

that view of the matter, no further relief is called for and

in view of the order that I propose to pass in the Chamber

Summons and the obligation to pay rent being admitted,

there is no warrant to grant any reliefs in Interim

Application no.3559 of 2020.

33. As far as the Interim Application no.3557 of 2020

is concerned, the restraint that is sought would be

premature inasmuch as to grant an injunction restraining

the respondent from entering into any agreement to

alienate, transfer or to create third party rights and

Chsl-824-19 wadhwa development rights, being the main relief, I find that the

applicants are also seeking certain disclosures from the

respondent in relation to the negotiations the respondent

is said to be engaged in with some investors.

34. Clause 26 of the development agreement does

contain a bar against assignment and transfer. It is not in

dispute that the Chamber Summons has come up for

hearing on several occasions and orders have been passed

therein as to the deposit of rentals. The applicants have

since brought to the attention of the Court that in separate

proceedings pending in this Court, the respondent has

admitted to being in negotiations on a restructuring

proposal. It appears that thereafter applicants' Advocates

have sought disclosures in respect to the unsold units in

Towers A, B and C. Under clause 28 of the consent award,

parties agreed that except for changes in amendment in

the consent terms, all other terms and conditions of the

development agreement would prevail, except in the event

of some repugnancy between the development agreement

and the consent terms, the consent terms have to prevail.

Chsl-824-19 wadhwa The intention of the parties is therefore clear viz. the

development agreement continues to govern the

relationship between the parties except as modified by the

consent terms and to the extent of such modification if

there is any repugnancy, the provisions of the consent

award would prevail. The respondent has not disputed

this aspect except that in regard to Tower C the

respondent is said to have full liberty to deal with Tower

by virtue of clause 19 of the consent terms. Clause 19

does not render provisions of clause 26 of the

development agreement nugatory.

35. I am of the view that there is no warrant for

directing the respondent to make the disclosure sought in

Interim Application no.3557 of 2020. However, the

respondent is obliged to comply with its obligation under

the consent award. However, that having been said, I am

of the view that it is not for the executing court to

consider grant of reliefs in terms of injunction sought

since that is an aspect which pertains to the parties

obligation under the development agreement which even

Chsl-824-19 wadhwa according to the applicants are not modified by the

consent award and remained unaffected and is by any

repugnancy contemplated under clause 28 of the consent

award. The relief sought may be available to the

applicants in appropriate proceedings but not in

execution of the consent award. Interim Application

no.3557 of 2020 must fail. That leaves us with the reliefs

sought in the Chamber Summons.

36. The amounts payable towards rent remain to be

paid and the applicants are admittedly entitled to receive

the same. The respondent's plea of being faced with the

liquidity crunch does not absolve the respondent of the

obligation to comply with the award and in execution

proceedings the decree holder is entitled to apply for

attachment. Under Rule 42 of Order XXI where the

decree is for rent, property of the judgment debtor may be

attached even before the amount due from judgment

debtor is ascertained. In the instant case, the respondent

claims to have furnished certain details along with

additional affidavit of September 2020 furnishing details

of 64 flats. The respondent admittedly has liquidity issues

Chsl-824-19 wadhwa but that alone will not prevent from steps being taken in

execution. In my view, considering the admitted liability

which is only escalating, the plaintiffs will be entitled to

further disclosures. The vague disclosure to the effect that

6.7 lakhs sq.fts remained unsold and have also been

mortgaged is of no consequence. In my view, the

respondent is liable to be ordered to disclose in all

particulars the flats/units unsold along with particulars of

the mortgage. The rights of the mortgagee is only to the

extent of the mortgaged debt and the security created any

amounts and overflow would be liable for attachment and

in the face of the admitted liquidity crunch, a disclosure is

thus warranted.

37. In view of the contention that the unsold premises

are said to be mortgaged and the possibility after

foreclosure of no overflow being available, it will be

necessary to secure the applicants entitlement. The

contention that 93% obligations under the consent terms

have been complied is of no avail. The security of

Reserved Area said to be valued at a sum of Rs.129.29

crores by the respondent is not acceptable to the applicant

Chsl-824-19 wadhwa and indeed as on date, there is no value agreed between

the parties so as to ascertain whether the Reserved Area is

sufficient security to meet all liabilities of the respondent

including the non-monetary obligation. In that view of

the matter, further disclosure would be justified and till

such disclosure is completed, in my view, it will be

appropriate that the respondent be restrained from

alienating, dealing with, selling, transfer of further

encumbering or parting with possession of any of the

unsold units forming part of the respondents allocation in

Tower C as sought by the applicants.

38. As far as the other aspects pertaining to the

approval of plans in respect of the duplex flats on the 66 th

and 67th floor, it is not in dispute that the respondent is

behind schedule. That amended plans have been

submitted for approval and approvals are awaited,

interior work is also not completed. The respondent has

sought further time. In my view, reasonable time will be

required since grant of approvals will not entirely be in

the hands of the respondent. No doubt, there are

Chsl-824-19 wadhwa allegations that there have been delays in seeking

approvals but that alone would not entitled to justify any

further order in execution at this stage. Likewise,

obligations under clause 12 of the consent award 14(i),

14(iii), 14(iv) of the consent award are said to be awaiting

compliance. These are the non-monetary aspects in

respect of which no further reliefs are sought at this stage.

39. The respondent has contended that possession of flat

A-3001 has already been handed over and the agreement

in respect thereof has been registered and hence no

occasion to seek any relief in this respect. The respondent

has also stated that No Objection Certificates (NOCs) in

respect of flat nos.A-6902, A-6903 and 6904 are awaited.

This is also an aspect that requires some time. Although

the breach is alleged of clause 18 of the consent terms, it

is the contention of the respondent that possession of the 5

flats on the 69th floor and one flat on 30th floor has already

been handed over to applicant no.4 and hence that

obligation has been complied. The respondent has also

confirmed that the Reserved Area B will be maintained till

possession of all flats complete in all respect has handed

Chsl-824-19 wadhwa over. The Reserved Area is intended to be security for

completion of all obligations and not merely for the rent

in relation to the payment of rent. The respondent has

already undertaken to pay rent as aforesaid and in

affidavit in reply to the Chamber Summons admitted that

they are willing to pay the additional rent at 4% p.a. upto

the date of handing over the possession.

40. The respondent has also sought from the claimant

flat-wise breakup / bifurcation of the amount claimed

towards rent. In the additional affidavit of 8 th September,

2020 the respondent has admitted that it has disclosed

details of outstanding rent payable and has reiterated its

resolve to make payment. The contention that the

Reserved Area provides sufficient security is not an

answer. The respondents suggestion that the Reserved

Area be sold and the monies be applied towards carrying

out internal works is also not acceptable. Therefore to

suggest that the Reserved Area is security to meet all the

pending obligations is not correct, for the parties have

agreed to and/or are bound by Clauses 22 and 23 of the

consent award which sets out the reason for providing the

Chsl-824-19 wadhwa Reserved Area viz. to ensure the respondents handing over

to the claimants the flats complete in all respects with

amenities specified in the annexures free from all

encumbrances not limited to allotment, sale of mortgage.

The contention that the Reserved Area secures the amount

of overdue rent and cost of interior works cannot be

accepted. There is substance in the applicants contentions

that, prima facie, a total of 47,760 sq. fts is yet to be

handed over complete in all respects since some of the

initial work is yet to be completed apparently for want of

funds. The Reserved Area is said to be only 22,389 sq. fts

and hence will clearly not cover the flats remaining to be

handed over completed in all respects as contemplated in

the Award. In my view, the applicants have made out a

case for further reliefs of disclosure prayed for in

Chamber Summons and for a temporary restraint. Upon

disclosures being made the applicants are at liberty to

proceed further to seek attachment in execution.

41. In view of the above I pass the following order;

(i) Chamber Summons is made absolute in terms of prayer

Chsl-824-19 wadhwa clauses j(i) and J(ii). Chamber Summons is also made

absolute in terms of prayer clause k(ii) restricted to

unsold units/flats in Tower C.

(ii) Interim Application nos.3557 of 2020 and 3559 of

2020 are dismissed.

(iii) No orders as to costs.

(A.K. MENON, J.)

Digitally signed by Sandhya Sandhya Wadhwa Wadhwa Date:

2021.01.12 10:21:52 +0530

Chsl-824-19 wadhwa