Calcutta High Court
Shree Balaji Sarees Private ... vs Shristi Infrastructure ... on 8 February, 2022
IN THE HIGH COURT AT CALCUTTA
Ordinary Original Civil Jurisdiction
Original Side
Present:
The Hon'ble Justice Shekhar B. Saraf
I.A. G.A. NO. 1 of 2021
in
C.S. NO. 132 of 2021
SHREE BALAJI SAREES PRIVATE LIMITED
Versus
SHRISTI INFRASTRUCTURE DEVELOPMENT CORPORATION LIMITED
For the Plaintiff/Petitioner : Mr. Jishnu Chowdhury, Advocate
Mr. Ratul Das, Advocate
Mr. Anirudha Agarwalla, Advocate
Ms. Debashri Mukherji, Advocate
For the Defendant/Respondent : Mr. Swatarup Banerjee, Advocate
Heard on : January 03, 2022, January 27, 2022, February 02, 2022, February 03,
2022 and February 08, 2022
Judgment pronounced in open Court on : February 08, 2022
Shekhar B. Saraf, J.:
1. In the present case, the petitioner/plaintiff is seeking an Order of
injunction restraining the respondent from dealing with the assets and
properties to the extent of Rs. 3,33,82.680/-.
2. The relevant facts of the case are as follows:
a) The petitioner had obtained an allotment in respect of a Real Estate
Project at New Town (hereinafter referred to as the "said project").
Provisional Letter of Allotment was issued in favour of the petitioner
by the respondent in respect of a flat on the 18th floor of the said
project on October 15, 2010, the petitioner made payment of a sum
of Rs. 3,04,01,764/- for the same. Thereafter, the respondent failed
to deliver the project to the petitioner within the designated time or
deliver possession of the said flat, as per the agreement between
the parties. The petitioner waited from second quarter of 2013 till
September, 2018. Thereafter, the petitioner issued the notice of
demand dated October 30, 2018.
b) Ultimately, the petitioner as a home buyer filed a petition as a
Financial Creditor before the National Company Law Tribunal
Bench (in short "NCLT"). During the pendency of such proceeding,
the respondent admitted that a sum of Rs. 4,44,01,764/- would be
paid and had offered to pay the same in instalments between
October 18, 2019 to March 25, 2020 and the same was recorded in
a Settlement Agreement executed by and between the petitioner
and the respondent on October 18, 2019. On this basis, the
company petition was disposed of by an order dated 1st November,
2019.
c) The respondent made payment for a sum of Rs.1,48,00,000/- but
thereafter failed to make payment and defaulted in payment of
instalments. The petitioner approached the NCLT but the Company
Petition has been dismissed on technical grounds, by an order
dated April 9, 2021. The petitioner has thereafter filed the present
suit. In the suit, the petitioner has filed the instant application for
injunction and attachment before judgment.
3. Mr. Jishnu Chowdhury, Counsel appearing for the petitioner, made the
following submissions:
a) The conduct of the respondent is extremely bad as between the
period from October, 2010 till September, 2018 the respondent has
failed to make over the allotted flat to the petitioner. Moreover, it
kept changing the petitioner's allotment.
b) The respondent defrauded the petitioner by entering into the
settlement agreement to ward off an order of admission in corporate
insolvency resolution process.
c) The respondent is not making a commitment to make payment to
the petitioner though the admitted amount is due.
d) The contract between the parties is not an infrastructure or a
construction contract and the petitioner is not a builder or a
contractor nor is the contract with the respondent is entered for
any such purpose. Therefore, Section 2(1)(c)(vi) of the Commercial
Courts Act, 2015 (hereinafter referred to as "the Act") does not
apply.
e) The contract between the parties does not fall under the ambit of
Section 2(1)(c)(vii) of the Act as well. He places reliance on Ambalal
Sarabhai Enterprises Limited v. K.S. Infraspace LLP & Anr.
reported in (2020) 15 SCC 585.
4. Mr. Swatarup Banerjee, Counsel appearing for the respondent, made
the following submissions:
a) The instant suit and the connected applications therein should be
taken up in the Commercial Division of this Hon'ble Court as the
transaction between the parties is covered under Section 2(1)(c)(vi)
of the Act.
b) The allotment of the petitioner is in the nature of a service
apartment which the plaintiff/petitioner was entitled to under the
construction agreement dated October 15, 2010. The said flat is not
a residential flat, therefore, it is apparent that Section 2(1)(c)(vi) of
the Act will apply in the present case.
c) The ratio decidendi in the judgement relied on by the petitioner has
been wrongly interpreted by the plaintiff/petitioner which will apply
to flats and buildings in trade and commerce.
5. I have heard the Counsels appearing for both the parties. In my view,
the present dispute is not hit by Section 2(1)(c) of the Act. Firstly,
Section 2(1)(c)(vi) of the Act refers to construction/development
contracts entered between two parties for development of a particular
property or infrastructure. In the present case, the relationship between
the parties is not of that nature. Hence, the petitioner is not hit by
Section 2(1)(c)(vi) of the Act. Secondly, the scope of Section 2(1)(c)(vii) of
the Act has been clearly discussed and decided by the Hon'ble Supreme
Court in Ambalal Sarabhai (supra) wherein it was held that merely
because the property is likely to be used in relation to trade and
commerce, the same cannot be a ground to attract jurisdiction of
Commercial Court. The words "used" in Section 2(1)(c)(vii) denotes
"actually used" and not "ready for use", "likely to be used" or "to be
used". In the present case the contract between the parties is with
regard to allotment of the flats as per the agreement. At the time of
allotment agreement, the property was not being used for trade and
commerce. Hence, the petitioner is not hit by the above clause of Section
2(1)(c)(vii) of the Act as well.
6. Further, the present suit is for enforcing a right that fructifies from a
settlement agreement dated October 18, 2019 entered into between the
parties. It was on the basis of this settlement agreement that National
Company Law Tribunal disposed of the matter filed before the same. It is
to be further noted that the parties acted in terms of the settlement
agreement and the respondent made payment of the first two
instalments to the tune of Rs. 1 Crore 48 Lakhs. The present suit is for
enforcement of the terms of settlement and it is therefore not covered
under Section 2 (1) (c) of the Commercial Courts Act, 2015. As the
respondent has already acted upon the settlement agreement he cannot
be allowed to blow hot and cold and is hit by the doctrine of approbate
and reprobate.
7. In light of the same, I am of the view, a prima facie case has been made
out by the petitioner and the respondent should be directed to secure
the petitioner. Mr. Swatarup Banerjee, Counsel appearing for the
respondent, offered two flats as security. In light of the same, till the
disposal of this application, for Flat no. 24A and 25A there shall be an
order of injunction restraining the respondent from dealing with and/or
disposing of and/or alienating and/or transferring and/or encumbering
the same.
8. Accordingly, let affidavit-in-opposition be filed within four weeks from
date; reply thereto, if any, within two weeks thereafter. Liberty is
granted to the parties to mention for listing.
9. Urgent Photostat certified copy of this order, if applied for, should be
made available to the parties upon compliance with the requisite
formalities.
(Shekhar B. Saraf, J.)
R.Bhar
