Sanjay Tandon vs Sarabjit Singh
1997 Latest Caselaw 431 Del

JUDGMENT

K.S. Gupta, J.

(1) This appeal by Sanjay Tandon, plaintiff-appellant, is directed against the order dated November 21, 1996 of learned Single Judge whereby No. 879/96 filed by him under Order Xxxix Rules 1 & 2 read with Section 151 Civil Procedure Code was dismissed.

(2) Suit has been filed by the appellant, inter alia, alleging that Sarabjit Singh, defendant respondent No. 1, is the owner of the property bearing No. A-196, defense Colony, New Delhi and he was interested to dispose of the property. As respondent No. 1 is residing in Usa, by executing a Special Power of Attorney dated September 30, 1995, he appointed Bhupinder Singh defendant-respondent No. 2, as his attorney. It is alleged that respondent No. 2 entered into an agreement to sell dated October 25, 1995, with the appellant. Under this agreement to sell the aforesaid property A-196 was agreed to be sold for a consideration of Rs. 45 lacs, out of which a sum of Rs. 5 lacs was paid by the appellant as earnest money through Pay Order No. 186395 dated October 24, 1995, in favour of respondent No. 1 which was duly encashed by him. It is further alleged that towards the balance sale consideration Rs. 17,50,000.00 were to be paid by the appellant to respondent No. 1 on or before November 24, 1995 and the remaining sum of Rs. 22,50,000.00 was to be received by respondent No. 1 from the appellant at the time of registration of sale deed before the Sub-Registrar, New Delhi on or before January 31, 1996. It is stated that appellant handed over a cheque bearing No. 116818 dated November 18, 1995, in the sum of Rs. 17,50,000.00 drawn on Punjab National Bank, Maharani Bagh, New Delhi, favouring respondent No. 1 to respondent No. 2. Initially respondent No. 2 accepted the cheque but returned it to the appellant with a covering letter dated November 20, 1995 on the ground that respondent No. 1 himself was coming to Delhi on or around 2nd week of January 1996 and he would get the entire amount of sale consideration himself from the appellant. It is further stated that respondent No. 1 reached India on or about 2nd week of January 1996 and since then the appellant has been requesting him to accept the second instalment of Rs. 17,50,000.00 and also to intimate the date when the balance payment is to be made by him against the execution of the sale-deed by respondent No. 1. However, No. 1 for reasons best known to him neither accepted the said amount, nor intimated the appellant as to when he would execute the sale deed of the aforesaid property in favour of the appellant and accept the balance sale consideration. Appellant has been ready and willing throughout to perform his part of the obligation under the agreement to sell dated October 25, 1995. It was prayed that a decree for specific performance be passed directing respondent No. 1 to execute sale deed in regard aforesaid property No. A-196, defense Colony, in favour of the appellant.

(3) In the suit Ia No. 879/96 was also filed by the appellant and on January 29, 1996, an ex-parte ad-interim order of injunction was passed by learned Single Judge against respondent No. 1 from taking any further steps to sell the suit property to any third party till further orders.

(4) Respondent No. 1 contested the suit by filing written statement. It is not denied that respondent No. 1 is the owner of property No. A-196, defense Colony, New Delhi and that he wanted to sell it. However, it is alleged that respondent No. 2 who is related to respondent No. 1, represented that he could get suitable offers from persons, who may be genuinely interested in buying the said property. In this background respondent No. 1 executed Special Power of Attorney dated September 30, 1995, in U.S.A. in favour of respondent No. 2. Under this Special Power of Attorney respondent No. 2 was authorised only to negotiate and to facilitate the sale of the property. It is stated that the alleged agreement to sell dated October 25, 1995, is a collusive document and respondent No. 2 in collusion with the appellant arranged to deposit Rs. 5 lacs in the account of respondent No. 1 with the Punjab & Sind Bank, New Delhi. It is denied that respondent No. 1 had knowledge of any transaction of Rs. 17,50,000.00 . It is alleged that if the transaction was genuine the said amount could also have been deposited in respondent No. 1's bank account which the plaintiff knew. It is stated that no communication either from the appellant or respondent No. 2 was ever received by respondent No. 1 about the alleged agreement to sell till January 1996 when respondent No. 1 arrived in India. For the first time respondent No. 1 received a copy of the agreement to sell in question alongwith the plaint. It is denied that any money towards balance sale consideration was offered by the appellant to respondent No. 1 as alleged.

(5) Ia No.879/96 was contested by respondent No. 1 by filing a reply on the pleas identical to those taken in the written statement.

(6) Respondent No. 2 in his written statement, inter alia, pleaded that the agreement to sell in question was well within the knowledge of respondent No. 1 and the same was executed by him on specific authorisation and instructions received from respondent No. 1. It is further alleged that the father-in-law of respondent No. 1 also accompanied him to deposit the amount of earnest money in the bank account of respondent No. 1. After retaining the copy, original pay-in-slip was handed over by respondent No. 2 to the father-in-law of respondent No. 1 who informed him that the same had been sent to respondent No. 1 through courier.

(7) By the impugned order dated November 21, 1996 the ex-parte order dated January 29, 1996 was vacated and Ia No.879/96 was dismissed by learned Single Judge. The appeal is against this order.

(8) It was contended by Shri Mukul Rohtagi appearing for the appellant that clauses 5 & 6 of the Special Power of Attorney dated September 30, 1995 executed by respondent No. 1 in respondent No. 2's favour authorise the latter to negotiate with a buyer regarding the sale price, accept the earnest money and also to execute agreement to sell on behalf of the former. As a part of this submission it was further argued by him that the averments made particularly in paragraph 13 of the written statement filed by respondent No. 1 that no communication from respondent No. 2 regarding execution of the agreement to sell in question was received by him till January 19, 1996 when he arrived at Delhi, are totally false. After the execution of the agreement to sell in question, respondent No. 1 agreed to sell the aforesaid property under another agreement to sell dated October 30, 1995 in favour of J.K.Malhan for a higher sale consideration of Rs. 48 lacs. IN this regard our attention was drawn to para 7 of the notice dated October 31, 1996 got sent by respondent No. 1 through his counsel to the appellant and respondent No. 2 and also to the photostat copy of the agreement to sell dated October 30, 1995 filed alongwith Ia No.7240/96 under Order I Rule 10 Rule 10 Civil Procedure Code by J.K.Malhan and Surinder Singh Sahlot for their impleadment in the suit. On the other hand, contention advanced by Shri S.N.Kumar appearing for respondent No. 1 was that the Special Power of Attorney dated September 30, 1995 does not authorise respondent No. 2 to enter into agreement to sell dated October 25, 1995 with the appellant and the same is a collusive document. In support of the plea of said agreement to sell being collusive he drew out attention to the order dated September 19, 1996 according to which Shri Vinod Kumar, Advocate, appearing for the appellant, informed the learned Single Judge that the written statement had been filed that day by respondent No. 2. It was emphatically denied that the alleged agreement to sell dated October 30, 1995 was executed by respondent No. 1 in favour of J.K.Malhan, as alleged.

(9) Execution of the Special Power of Attorney dated September 30, 1995 in favour of respondent No. 2 is admitted by respondent No. 1. Thus, the controversy between the parties mainly centres around the interpretation particularly of clauses 5 & 6 thereof. Before adverting to both these clauses we would like to deal with the latter limb of the argument, referred to above, advanced on behalf of the appellant. The suit came up for the first time before the Court on January 29, 1996 and the order sheet of that date goes to show that Shri M.S.Vohra with Ms.Amrit Kaur put in appearance on behalf of respondent No. 1 on that date itself. Complete set of plaint and documents was ordered to be supplied to them within three days by the appellant's counsel. Obviously, notice dated October 31, 1996 was got served by respondent No. 1 through counsel on respondent No. 2 and also on the appellant after the copies of the plaint and the documents filed therewith were made available to respondent No. 1's counsel. Needless to say that the plea taken in para 13 of the written statement by respondent No. 1 is that no communication either from the appellant or respondent No. 2 was ever received by respondent No. 1 about the alleged agreement to sell dated October 25, 1995 till January 19, 1996 when respondent No. 1 arrived at Delhi and for the first time copy of the agreement to sell was sent to respondent No. 1 alongwith the plaint. Para 7 of the aforesaid notice dated October 31, 1996 which is relevant runs as under: "THAT you addressee No. 1, informed our client in the first week of November 1995 that one Shri Sanjay Tandon has agreed to pay a sum of Rs. 75 lacs for the property of our client in the present position of the property and to show his genuineness he has deposited Rs. 5 lacs in our client's account."

(10) A bare perusal of said para 7 of the notice prima facie falsifies the stand taken in para 13 of the written statement that respondent No. 1 was not aware till January 19, 1996 about the agreement to sell dated October 25, 1995 and deposit of Rs. 5 lacs by way of earnest money in his bank account. Further, the order dated August 9, 1996 indicates that Ia No.7240/96 filed by J.K.Malhan and Surinder Singh Sahlot for impleadment as defendants on the ground of respondent No. 1 having agreed to sell the said property to them under an agreement to sell dated October 30, 1995 for a sum of Rs. 48 lacs was dismissed, they being neither necessary nor proper parties, by the learned Single Judge.

(11) Clauses 5 & 6 of the Special Power of Attorney dated September 30, 1995, which are relevant read thus: @SUBPARA = Whereas to facilitate the preliminary negotiations with a buyer regarding the sale price, acceptance of earnest money, execution of a sales agreement, and to do other acts necessary to enter into negotiations, etc. I hereby appoint, nominate and constitute Sardar S.Bhupinder Singh, M.A., LL.B.Advocate, High Court of I/8, Lajpat Nagar-III, Near Gurdwara, New Delhi-24, India, and that I execute the Specific Power of Attorney in his favour with the express stipulation and understanding that the sale contract will be singed by me Sarabjit Singh in person and also the Registration of the Property shall also be signed subsequently by me in person before and in presence of Registrar .... ...."

(12) A combined reading of both the said clauses prima facie shows that respondent no. 2 was not only authorised to facilitate the deal for sale of the aforesaid property No. A-196, defense Colony, but also to accept earnest money and execute the agreement to sell with the buyer on behalf of respondent No. 1. Admittedly Rs. 5 lacs stand deposited by the appellant in respondent's bank account by way of earnest money. this deposit was brought to the notice of respondent No. 1 by respondent No. 2 in the first week of November 1995 as admitted in para 7 of the aforementioned notice dated October 31, 1996. That being so, the appellant atleast has been able to make out a fairly good arguable case to seek an order restraining respondent No. 1 from selling, transferring possession and/or creating any charge on the aforesaid property No. A-196 by respondent No. 1 during the pendency of the suit. Non grant of interim relief is likely to cause such injury, which it will not be possible to compensate by awarding damages. Balance of convenience also lies in the grant of junction prayed for. Learned Single Judge thus, acted erroneously in dismissing Ia No.879/96 in terms of the impugned order.

(13) For the foregoing discussion the appeal is accepted. The impugned order is set aside. Ia No. 879/96 is allowed and pending suit respondent No. 1 is restrained from selling, transferring possession and/or creating charge on the aforesaid property No. A-196, defense Colony. In the circumstances, no order is made as to costs.