Shri Sunil Aggarwal vs Shri M.C. Sharma And Others
2008 Latest Caselaw 1941 Del

     *IN THE HIGH COURT OF DELHI AT NEW DELHI

+I.As. No. 9811/2005, 2375/2006, 2376/2006, 2377/2006,
          1060/2007, 1209/2007 and 965/2008
                in CS (OS) No. 1653/2005

%                                                 Date of decision :                     04.11.2008

SHRI SUNIL AGGARWAL                                                                          ....Plaintiff

                                            Through: Mr. Pankaj Vivek, Advocate


                                                  Versus

SHRI M.C. SHARMA AND OTHERS                                                              ....Defendants

                                             Through: Mr. G.D. Chopra, Advocate for the
                                                      Defendant No. 1
                                                      Mr. B.P. Gupta, Advocate for the
                                                      Defendants No. 2 and 6
                                                      Mr. N.K. Sharma, Advocate for the
                                                      Defendants No. 3 and 5
                                                      Mr. Ajay Jain, Advocate for the
                                                      Defendant no. 7
                                                      Mr. R.K. Sinha, Advocate for the
                                                      Defendants No. 8 and 9

CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

1.       Whether reporters of Local papers may
         be allowed to see the judgment?       Yes

2.       To be referred to the reporter or not?                              Yes

3.       Whether the judgment should be reported
         in the Digest?                        Yes


RAJIV SAHAI ENDLAW, J.

1. This order in a suit for specific performance of Agreement of

sale of immovable property and in the alternative for damages shall

dispose of I.A. No. 9811/2005 of the Plaintiff under Order 39 Rules 1

and 2 CPC, I.A. No. 2375/2006 of the Defendants No. 8 and 9 under

Order 39 Rule 4 CPC for vacation of the ex parte ad interim order

dated 5th December, 2005 and I.A. No. 2376/2006, also of the

Defendants No. 8 and 9 under Order 7 Rule 11 CPC.

2. The Plaintiff claims that the Defendants No. 1 to 3 through the

property broker/Defendant No. 4 offered for sale to the Plaintiff, the

entire proposed construction of ground, 1st, 2nd and 3rd floor on

adjoining plots of land bearing nos. C-2/15 and C-2/16, Sector 15,

Rohini, Delhi-110085. It is further the case in the plaint that the

Defendant No. 1 posed himself as a builder, the Defendant No. 2

posed himself as the owner of plot no. C-2/15 and the Defendant No.

3 as the owner of plot no. C-2/16; that it was represented that the

Defendant No. 1 had been authorised to construct and sell the house

to be built on the aforesaid 2 plots of land. The Plaintiff claims that 4

Agreements to Sell for each of the aforesaid 4 floors respectively

were executed by the Defendant No. 1 only in favour of the Plaintiff

on 20th and 23rd April, 2001 for a total sale consideration of Rs.

38,75,000/- out of which the Plaintiff paid Rs. 12 lacs and the balance

sale consideration of Rs. 26,75,000/- was agreed to be adjusted with

respect to two other properties owned by the Plaintiff and his mother

Smt. Angoori Devi, respectively and with respect to which two

properties, documents of transfer were executed by the Plaintiff and

his mother in favour of the Defendant No. 2, though possession

thereof remained with the Plaintiff, to be delivered upon completion

of construction on the aforesaid 2 plots of land and delivery of

possession thereof to the Plaintiff. It is further the case in the plaint

that construction on the said 2 plots was commenced by the

Defendants No. 1 to 3 in July, 2001 but the work of construction was

abandoned after a few days only and not resumed despite repeated

requests of the Plaintiff. The Plaintiff claims to have subsequently

learnt that the aforesaid 2 plots of land were not owned by the

Defendant No. 1 and that the Defendant No. 1 alongwith the

Defendants No. 2 to 4 had committed a fraud on the Plaintiff. The

Plaintiff on 19th November, 2001 made a complaint to the police of

the fraud and cheating committed by the Defendants No. 1 to 4. It is

further pleaded that the Plaintiff in the circumstances had no option

but to presume that the Defendants No. 1 to 4 were resiling from the

deal with respect to the said 2 plots of land and therefore, the

Plaintiff and his mother on 29th November, 2002 cancelled the

documents executed with respect to the other two properties against

the price/value whereof the balance sale consideration of Rs.

26,75,000/- was adjusted. FIR No. 668/2002 dated 10th November,

2002 of police station Prashant Vihar, Delhi is also stated to have

been registered against the Defendants No. 1 to 4. The Plaintiff

during the investigation claims to have learnt that plot no. C-2/16

was owned by the Defendant No. 5 who is the brother of the

Defendant No. 3; that the Defendant No. 5 has sold the said plot to

the Defendant No. 7 who is stated to have purchased the same with

the knowledge of the prior Agreement in favour of the Plaintiff. The

Defendant No. 7 is stated to have transferred the plot no. C-2/16 to

the Defendant No. 8. The Defendant No. 9 is the husband of the

Defendant No. 8.

3. The Plaintiff claims to have further learnt that plot no. C-2/15

was got registered by the Defendants No. 1 and 2 in favour of the

Defendant No. 6 on 9th May, 2001 i.e. after the Agreement to Sell in

favour of the Plaintiff. In para 19 of the plaint it is stated -

"19. Thus the defendant nos. 5, 6, 7 & 8 are subsequent purchasers of property who are liable to deliver the suit property to the plaintiff when a decree is passed against the other defendant. However these all are being impleaded herein as all are necessary and proper parties

and their presence is necessary to avoid multiplicity of suits."

4. The plaint further states that in September - October, 2005,

the Plaintiff and his mother were served with copies of the suits filed

by the Defendant No. 2 for specific performance and possession of

the other two properties which were agreed to be transferred by the

Plaintiff and his mother in favour of the Defendant No. 2 towards

balance sale consideration of Rs. 26,75,000/- payable by the Plaintiff

with respect to the 2 plots of land and construction thereon to be

transferred in favour of the Plaintiff.

5. Para 22 of the plaint is pivotal for the present and is set out

hereinbelow.

"22. That in these facts and circumstances the plaintiff also has no option but to file the present suit for specific performance as the suit property is bonafidely required by the plaintiff for his self use and there is no other similar property available in the locality........................."

6. The plaint of course has the averments of the readiness and

willingness of the Plaintiff. The Plaintiff has further stated that even

though he was forced to get the documents with respect to the

other two properties cancelled but he is ready and willing to pay the

balance sale consideration of Rs. 26,75,000/- if the built-up property

on the said 2 plots of land is delivered to him and minus the cost of

construction assessed at Rs. 15 lacs if the plots as existing today

with minimal construction thereon and photographs of which are on

the file, are handed over. The Plaintiff in the alternative has claimed

damages in the sum of Rs. 24 lacs with interest till institution of the

suit of Rs. 12,60,000/- and future interest from the Defendants

jointly and severally.

7. On the application of the Plaintiff for interim relief of

restraining the Defendant from constructing, selling, altering or

parting with possession of the aforesaid 2 plots of land vide ex parte

order dated 5th December, 2005 as aforesaid, this court directed the

defendants to maintain status quo in regard to possession and title

as of then. The said order continues to be in force and for vacation

whereof, the Defendants No. 8 and 9 have applied. The Defendants

No. 8 and 9 also seek rejection of the plaint qua them for the reason

of the plaint not disclosing any cause of action against the

Defendants No. 8 and 9 and further for the reason of the plaint being

full of falsehood and being vexatious.

8. The Defendant No. 1 in his written statement filed after the

hearing of arguments and in terms of the order made on that date,

has denied the transactions with the Plaintiff or having any rights

with respect to the 2 plots of land, subject matter of the suit.

9. Similarly, the Defendant No. 3 in his written statement has

also denied the transaction. The Defendants No. 2 and 6 in their

joint written statement have also denied any transaction with the

Plaintiff with respect to the 2 plots of land, subject matter of the

present suit and have referred to the suits filed by the Defendant No.

2 against the Plaintiff and his mother for specific performance and

pending before the district courts; It is denied that the transaction,

subject matter of the other suits was part and parcel of the

transaction with respect to the plot no. C-2/15 of which the

Defendant No. 2 admits to be the owner and with respect to which

he claims to have entered into an Agreement to Sell with the

Defendant No. 6 on 21st May, 2001. The stand of the Defendants No.

8 and 9 relevant for the present purposes has already been noted

above. The Defendant No. 4 i.e. the property broker has also denied

being a broker to the transaction with respect to the 2 plots,

between the Plaintiff and the Defendants No. 1 to 3.

10. In the aforesaid scenario, it has to be decided whether during

the pendency of the suit, the interim order restraining construction,

alienation and parting with possession of the 2 plots of land

aforesaid, is to be granted / continued. Even though the ex parte

order was for maintenance of status quo qua title and possession

only but it is the stand of the Defendants No. 8 and 9 that they have

in deference to the same, not raised any construction also on the

property.

11. Vis-a-vis the ingredient of prima facie case, I do not find the

Plaintiff entitled to the relief of specific performance of Agreement

to Sell. For the Plaintiff to be entitled to the relief of specific

performance, the Plaintiff has to plead and prove his readiness and

willingness all throughout to perform his part of the Agreement.

Though lip service to the said effect has been paid in the plaint but

on the averments in the plaint itself, I do not find the Plaintiff to

have been ready and willing to perform his part of the Agreement.

12. The Agreement as per the Plaintiff's own showing was for

payment of the sale consideration of Rs. 26,75,000/- by transfer by

the Plaintiff and his mother of two other properties in favour of the

Defendant No. 2 and with respect to which the documents were

admittedly executed by the Plaintiff and his mother in favour of the

Defendant No. 2. The Plaintiff himself has in the plaint stated that

in October - November, 2002, he realised that the Defendants No. 1

to 4 had cheated him and the Defendant No. 1 had entered into an

Agreement to Sell with the Plaintiff without having any authority to

do so. Though the Plaintiff has in the plaint also stated that the

Defendant No. 1 was having authority and photocopies of some

documents to which effect have also been filed but the Plaintiff in

November, 2002 chose to treat the deal of sale of the said 2 plots

with construction thereon in his favour to have come to an end and

accordingly cancelled and made his mother cancel the documents

executed with respect to the other two properties. There is thus an

express admission of the Plaintiff having treated the transaction to

have come to an end and having acted accordingly. The Plaintiff

having done so is not entitled to change his mind and sue for specific

performance. The Plaintiff having once elected to have treated the

sellers to have resiled from the Agreement to Sell in his favour,

would prima facie not be entitled to the relief of specific

performance. The Division Bench of this court in Gopal Devi v

Kanta Bhatia (AIR 1994 Delhi 349) referring to (1) Adeshir M.

Mama v. Flora Sassoon (AIR 1928 PC 208); (2) Sundarramayyar

V K. Jagdeeshan and Anr (AIR 1965 Mad 85) and (3) Ayissabi Vs.

Gopala Konar (AIR 1989 KER 134) held that where plaintiff had

prior to institution of suit for specific performance issued notice

claiming double the amount of earnest money, the plaintiff is not

entitled to the relief of specific performance. The action of the

plaintiff in the present case of cancelling the documents of transfer

of other two properties, agreed to be transferred in payment of part

sale consideration for suit property, is akin to the plaintiff in the

present case claiming, if not receiving refund of part sale

consideration. The plaintiff having done so, is prima facie not

entitled to the relief of specific performance.

13. The Plaintiff at that time did not elect to sue for specific

performance and in fact has expressly admitted to have instituted

the present suit having been left with no option upon institution of

the suits for specific performance by the Defendant No. 2 against the

Plaintiff and his mother. Further when the Plaintiff himself claims

that the Defendants No. 1 to 4 who had allegedly entered into the

Agreement to Sell with the Plaintiff had committed fraud by being

not entitled to do so, the question of the Plaintiff being entitled to the

relief of specific performance prima facie does not arise.

14. There is yet another interesting aspect of the case. The

Agreements of Sale relied upon by the Plaintiff are executed by the

Defendant No. 1 only and which disclose the Defendant No. 1 only to

be the owner of the two plots of land. The Plaintiff only subsequently

under a list of documents dated 21st July, 2006 i.e. after the

institution of the suit has filed photocopies of documents evidencing

the Agreement to Sell in favour of the Defendant No. 1 with respect

to the plots of land. This shows that the Plaintiff, till the institution

of the suit was not even aware of any title or right in favour of the

Defendant No. 1 to execute the Agreement to Sell in favour of the

Plaintiff. It is for this reason only that FIR was lodged by the

Plaintiff against the Defendants No. 1 to 4.

15. The Plaintiff being prima facie not entitled to the relief of

specific performance of Agreement to Sell, no purpose would be

served in restraining construction on the property or restraining

alienation of the same by the Defendant No. 6 and the Defendant No.

8 who now claim to be entitled to the two plots respectively and

whose predecessors also, admittedly have not executed any

Agreement/document in favour of the Plaintiff.

16. The Plaintiff has in the plaint also not stated that in the event

of specific performance he is willing to transfer the other two

properties in favour of the Defendant No. 2 and which as per the

Plaintiff himself was the Agreement. The Plaintiff and his mother

appear to be contesting the suits for specific performance and

possession instituted by the Defendant No. 2. Though the written

statements filed by the Plaintiff and his mother in those two suits

have not been filed before this court, it is nowhere the case of the

Plaintiff that the defence of the Plaintiff and his mother in those two

suits is that they are willing to transfer those two properties subject

to the suit property being transferred in favour of the Plaintiff. On

the contrary, the Plaintiff has pleaded that he is willing to pay Rs.

26,75,000/- to the Defendants. However, that was not the

Agreement as per the Plaintiff himself. Thus, the Plaintiff while

seeking specific performance has in the plaint itself not offered to

perform his part by transfer of the aforesaid two properties but has

attempted to change the Agreement and which is not permissible

and which plea also prima facie would disentitle the plaintiff to the

relief of specific performance.

17. I also do not to find a prima face case for specific performance

in favour of the Plaintiff for the reason that the agreement of which

specific performance is sought is of transfer of built-up property

which admittedly does not exist and the coming into existence

whereof is also unlikely.

18. The Plaintiff himself has in the plaint proposed adjustment of

Rs. 15 lacs towards cost of construction out of the balance sale

consideration of Rs. 26,75,000/-. This would again entail the court

redrafting the Agreement and which will be replete with difficulties.

19. I have at this stage refrained from commenting on the prima

facie with respect to the interlinking of the transaction with respect

to the suit property and the other two properties lest the same

affects the decision of the suits for specific performance pending

before the district court.

20. There is also on record a certified copy of a judgment dated

31st August, 2006 in Suit No. 222/2005 of the court of Shri P.K.

Saxena, Additional District Judge, Delhi in a suit filed by the Plaintiff

and his mother against the Defendants No. 1 to 4 herein. The

Plaintiff and his mother had instituted the said suit for declaration

that the documents executed by them in favour of the Defendant No.

2 herein with respect to the other two properties are null and void

and stand cancelled and for direction to the Defendant No. 2 herein

to deliver the original documents. The preliminary issue qua

limitation was framed in the said suit which was adjudicated by the

said judgment. A reading of the said judgment also shows that the

stand of the Plaintiff in that suit also was of the documents with

respect to the other two properties have become null and void for

the reason of the sale with respect to the suit property being not

possible in favour of the Plaintiff.

21. Besides the ingredient of prima facie case, I do not find the

ingredients of irreparable loss and balance of convenience also in

favour of the Plaintiff. The Plaintiff had as far back as in the year

2002 formed an opinion that he is not entitled to the said 2 plots or

construction thereon and acted accordingly. The Plaintiff thus will

not suffer any irreparable injury if the said plots are constructed

upon or dealt by the persons who now claim to have right to the

same. The plots have been lying unconstructed for the last over 7

years and there would be no justification for depriving the said

persons of enjoyment thereof any further. If the Plaintiff ultimately

fails, there would be way to compensate the said persons for the loss

occasioned to them and attributable to the Plaintiff.

Notwithstanding the said position, I may add that the provisions of

Section 52 of the Transfer of Property Act would in any case still be

applicable and it is common knowledge that people hesitate to

buy/invest in properties under litigation. The said persons would

thus in any case, even in the absence of an injunction order, suffer if

the Plaintiff ultimately fails.

22. Thus, the application of the Plaintiff for interim relief is

dismissed and the application of the Defendants No. 8 and 9 for

vacation of the ex parte order is allowed. The ex parte order shall

stand vacated w.e.f 30 days of the date of this order.

23. As far as the application of the Defendants No. 8 and 9 for

rejection of the plaint qua them is concerned, the plea of the

averments in the plaint being false is no ground for rejection. The

plea of the plaint not disclosing any cause of action against the

Defendants No. 8 and 9 is also misconceived. The Plaintiff has in the

plaint stated that the Defendants No. 5 to 8 are subsequent

purchasers. Under Section 19 of the Specific Relief Act, a person

who derives title to the property subsequent to the Agreement to Sell

in favour of the Plaintiff is a necessary and proper party in a suit for

specific performance and specific performance can be ordered

against such person. As far as the other preliminary objections

raised by the Defendants No. 8 and 9 in their written statement as

also by the other Defendants particularly qua limitation, the same

will be dealt at an appropriate stage. The application of the

Defendants No. 8 and 9 under Order 7 Rule 11 CPC is thus

dismissed.

24. Nothing contained herein shall be deemed to be an expression

on merits of the case.

25. Besides the aforesaid applications, I also find the following

applications pending and though arguments were not expressly

heard thereon, I find that in the light of the discussion above, the

same can also be disposed of and need not remain pending.

I.A. No. 2377/2006 (of the Defendants No. 8 and 9 under Section 340 of the Cr.P.C.

26. The plea of the Defendants that the Plaintiff has falsely verified

the plaint, cannot be adjudicated at this stage. The request of the

Defendants No. 8 and 9 for prosecution of the Plaintiff shall be

considered at the time of final judgment in the suit. The application

is disposed of.

I.A. No. 1060/2007 (of the Defendants No. 8 and 9 for clarification of the interim order)

27. The Defendants No. 8 and 9 sought clarification that as per the

ex parte order, they are entitled to raise construction on their plot of

land. In view of the said ex parte order being vacated, this

application does not survive and is dismissed as infructuous.

I.A. No. 1209/2007 (of the Defendant No. 1 for placing the documents on record)

28. Since issues have not been framed in the suit as yet, the

documents filed are taken on record and the application is disposed

of.

I.A. No. 965/2008 (of the Defendants No. 8 and 9 for early hearing of the applications for interim relief)

29. In the wake of the applications for interim relief being disposed

of, this application does not survive and is disposed of as infructuous.

RAJIV SAHAI ENDLAW (JUDGE) November 4 , 2008 smp