R.S. Arya vs T.R. Dewan
1996 Latest Caselaw 248 Del

JUDGMENT

S.K. Mahajan, J.

(1) The plaintiff filed this suit for specific performance of an agreement to sell dated August 26, 1995 whereby the defendant had agreed to sell plot No.63-D, Dilshad Garden-1, Delhi - 110 095 for a total sum of Rs.7,95,000.00 . A receipt dated August 26, 1995 was executed by the defendant acknowledging a sum of Rs.20,000.00 in cash and Rs.75,000.00 by means of a cheque towards sale consideration of the said plot. In terms of the said receipt, last date for registration of the sale deed was October 15, 1995 and it is also stated that thereafter the agreement would be invalid. On October 12, 1995 the plaintiff handed over two cheques for Rs.3,22,500.00 and Rs.3,77,500.00 towards the balance sale consideration of Rs.7,00,000.00 . One of the said cheques, however, for Rs.3,77,500.00 when presented to the bank was dishonoured. The case of the plaintiff is that after the said cheque had been dishonoured, he went to the residence of the defendant on October 15, 1995 and offered a. sum of Rs.3,77,500.00 in cash to the defendant and further requested him to execute the sale deed in his favour, however, the defendant showed his inability to execute the sale deed on Monday on the ground that he would not be able to obtain income-tax clearance certificate by that time. It is alleged that on the request of the defendant to extend the time for execution of sale deed upto October 18, 1995 by which time the defendant was likely to obtain the income-tax certificate, the plaintiff agreed to the alleged request of the defendant. The plaintiff is alleged to have got a bank draft prepared on October 17, 1995 and the defendant promised to come to the office of the Sub-Registrar on October 18, 1995. It is alleged that the plaintiff came to know on October 19, 1995 that the defendant was negotiating for the sale of the property to some other person and the present suit was, therefore, filed by. the plaintiff for specific performance of the agreement to sale and for an injunction restraining the defendant from dispossessing the plaintiff from the suit property. One of the allegations made in the plaint are that on October 12, 1995 when the plaintiff had handed over two cheques to the defendant for a total sum of Rs.7,00,000.00 , possession of the suit property was handed over to the plaintiff by the defendant. It was on these allegations that this Court vide an ex parte order of injunction restrained the defendant on October 27, 1995 from transferring, alienating or creating any third party interest or dispossessing the plaintiff from the property in suit.

(2) Defendant, after being served, has filed written statement as well as an application under Order 39 Rule 4 Civil Procedure Code for vacation of the ex parte stay. The case of the defendant is that time was essence of the contract and as the plaintiff had failed to make entire payment by October 15, 1995, the agreement came to an end and the same cannot be specifically performed. The defendant has also denied that possession of the property was delivered by him to the plaintiff on October 12, 1995 or on any other date. It is alleged that unless entire consideration was paid to the defendant, there was no question of the defendant handing over possession of the plot to the plaintiff. On a request of the defendant, a local commissioner was appointed on November 23, 1995 to go to the spot and give his report about the state of affairs existing therein.

(3) The local commissioner after visiting the spot on November 24, 1995 has submitted his report stating that one Mr.R.K.Srivastava had met him at site who informed the local commissioner that he had been awarded the work of digging and filling the foundation in the plot in question by Mr. Sanjay Gupta and Mr. Mukesh Gupta. On being asked as to when did he start the work, the local commissioner was informed that the work had started the same day i.e. 24th November, 1995. On making enquiries from residents of the adjacent plot, the local commissioner was informed that a week earlier a man had come to the spot and had fixed a board bearing the particulars "owner of the plot D-63, Dilshad Extension, Mr.R.S.Arya, Branch Manager, Lic of India, contact Ph.2208337". On being asked by the neighbourers from the said person who was fixing the board as to who he was and on whose behalf he was fixing the board, the man replied that defendant was the owner of the plot in question and that man had purchased the same from him. When commission proceedings were continuing, Mr.Mukesh Gupta and Mr.Sanjay Gupta also came to the plot in question with one Mr.Khanna, however, they refused to sign the proceedings.

(4) Though, the contention of learned counsel for the defendant is that time was essence of the contract and after October 15, 1995 the contract became invalid, however, I am unable to agree to this contention of learned counsel for the defendant. Prima facie, in the case of sale of an immoveable property, time is not the essence of the contract. However, the question is whether the plaintiff had been given possession of the plot and as to whether the plaintiff is entitled to the grant of an injunction restraining the defendant from selling, transferring or alienating the plot in favour of any other person. Ex parte injunction was granted to the plaintiff on the basis of the allegations made in the plaint that he was in possession of the same. There is nothing on record to show as to when the possession was delivered by the defendant to the plaintiff. It is the case of the plaintiff that no writing was executed by the defendant at the time of delivering vacant possession of the plot of land to the plaintiff. At one place in the plaint it is stated that on October 15, 1996 when plaintiff allegedly visited the house of the defendant, he wanted the defendant to execute the sale deed on Monday to which the defendant replied that it would not be possible for him to execute the sale deed on Monday as by that time he would not be able to obtain income-tax certificate. First Monday after October 15, 1995 fell on October 21, 1995. If that was the stand of the defendant on October 15, 1995, it is not understood as to how the defendant agreed to execute the sale deed on October 18, 1995 and reach the office of the Sub-Registrar on that day. Stand of the plaintiff is self-contradictory. I am also unable to agree to the contention of the plaintiff that possession was handed over to him on October 12, 1995. Neither there is any writing nor there is any other thing to prove that possession was handed over to him on that day. In case, possession had been handed over to the plaintiff by the defendant on October 12, 1995 when the cheques are alleged to have been delivered by the plaintiff to the defendant, there was no occasion for the plaintiff to fix the board stating the plaintiff was the owner of the plot in question, on or about a week earlier then 24th November, 1995. An ex parte injunction was granted to the plaintiff on 27th October, 1995 and it appears that after grant of an order of injunction by this Court, the plaintiff went to the spot and started fixing his board. There cannot be any other explanation as to why the board showing that plaintiff was the owner of the plot in question was fixed a week earlier than 24th November, 1995 as is evident from the report of the local commissioner. Report of the local commissioner has not been challenged by the plaintiff. The digging in the plot was also started only on 24th November, 1995 i.e. one day after the date when the local commissioner was appointed to visit the spot. It clearly shows that the plaintiff was creating some evidence to prove his possession. On the basis of the material on record, I am, prima facie, of the opinion that possession of the plot was not with the plaintiff.

(5) A substantial part of the sale consideration has been paid by the plaintiff to the defendant and I, therefore, feel that with a view to protect the interest of the plaintiff it will be necessary to restrain the defendant from transferring or alienating the property to any other person till the disposal of the suit. However, till such time the suit is decided, in my opinion, defendant cannot be restrained from raising any construction thereon in accordance with the municipal bye laws. In case, the plot is allowed to remain in the present condition, no useful purpose will be served and no party to the suit will be able to get benefit out of the said plot. With the increase in the cost of construction, it may also not be beneficial for either of the parties to have the plot in the same condition as it is existing presently. In case, the defendant is permitted to raise the construction and enjoy the property, in my opinion, no prejudice will be caused to the plaintiff. In case, the plaintiff ultimately succeeds, he will be entitled to get possession of the plot and the defendant will be bound by the principles of lis pen dense and he may not be entitled to claim either the value of the construction which may be raised by him and he may even have to demolish the structure which may be constructed by him on the plot in question.

(6) In Jiwan Dass Rawal Vs. Narain Dass and Ors., Air 1981 Delhi 291, it was held that till the decree for specific performance was obtained, the vendor or a purchaser from him was entitled to full enjoyment of the property. It was further held that temporary injunction cannot be issued at the instance of the person in whose favour agreement to sale was executed to prevent the transferee under the sale deed from enjoying. the possession of the plot under transfer and get the sale mutated in his favour. Mr.Lao, learned counsel for the defendant has placed reliance upon this judgment in support of his contention that no restriction can even be placed upon the right of the defendant to transfer the property in favour of a third party. I am afraid, I do not agree with the arguments of Mr.Lao. While there cannot be any restraint to the enjoyment of the property by the defendant in any manner he likes, even by constructing a building on the plot, however, till such time the matter is decided, in my opinion, it will not be proper to allow the defendant to sell or transfer the property in favour of a third party. It is not a case where the plaintiff has paid only a small amount of consideration. More than half the consideration amount has been paid by the plaintiff to the defendant and the plaintiff was prepared to pay even the balance consideration, two days after the last date mentioned in the agreement, however, defendant had refused to accept this amount solely on the ground that as the time was essence of the contract and no money having been paid by 15th October, 1995, he 'will not accept the money offered to him by the plaintiff on October 17, 1995.

(7) Taking all these facts into consideration, I am, prima facie, of the opinion that plaintiff is entitled to the grant of an injunction restraining the defendant from transferring or alienating the property to a third party till the matter is finally decided by the Court.

(8) In view .of the foregoing, while I hold that possession of the plot was not delivered by the defendant to the plaintiff, I restrain the defendant from transferring or alienating the said property to any other person till the disposal of the suit. This order will, however, not come in the way of the defendant to raise any construction on the plot of land in accordance with the municipal by laws.

(9) With these observations, both the applications stands disposed of.