Citation : 2025 Latest Caselaw 5057 Guj
Judgement Date : 24 June, 2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/APPEAL FROM ORDER NO. 116 of 2025
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2025
In R/APPEAL FROM ORDER NO. 116 of 2025
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RASIKBHAI DHIRAJLAL AMBALIYA
Versus
PARIMALKUMAR NATWARLAL THAKAR & ORS.
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Appearance:
S M KIKANI(7596) for the Appellant(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE MAULIK J.SHELAT
Date : 24/06/2025
ORAL ORDER
1. Heard learned advocate Mr. S.M. Kikani for the
appellant.
2. The present appeal is filed under Order 43, Rule 1 of the
Civil Procedure Code, 1908 (hereinafter referred to as the
"CPC"), challenging the judgment and order dated 9th January
2025 passed by the Principal Senior Civil Judge, Kathor below
Exhibit 5 in Special Civil Suit No. 28 of 2023.
3. As far as possible, the parties will be referred to as per
their original positions before the Trial Court.
4. THE SHORT FACTS OF THE CASE
4.1. The appellant herein is the original plaintiff whereas
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the respondents herein are the original defendants. It is the
case of the plaintiff that he entered into an agreement to sell
(ATS) and a memorandum of understanding (MOU) with
Defendant No. 1, which was registered on 17th December
2015. The suit land has co-shares, wherein Defendant No. 1
holds ¼ share in the suit property, for which the aforesaid
agreements were executed between the plaintiff and defendant
No. 1.
4.2. It is further alleged by the plaintiff that between 2015
and 2018, Rs.31,00,000/- has been paid by the plaintiff to
Defendant No. 1 either through bank transfer or cash. Cash
receipts are duly signed and acknowledged by Defendant No.
4.3. As Defendant No. 1 did not act upon the terms of the
agreement to sell by having it converted into non-agricultural
land and divided for development as agreed between the
parties, a notice came to be issued by the plaintiff for the first
time on 25th October, 2021, whereby he called upon
Defendant No. 1 to act as per the agreements.
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4.4. It appears that such notice was responded to by
Defendant No. 1 through his lawyer on the 10th of November
2021, and he denied to act as per the agreement to sell by
contending, inter alia, that the memorandum of understanding
was to be acted upon once the land was divided and the same
ought to have been done once the final town planning comes
into play, whereby final plot number can be allotted for the
suit property. It further appears that Defendant No. 1 has also
filed a caveat in the court in year 2021 itself.
4.5. Thus, by way of the reply and the act of Defendant
No. 1, it can be safely said that Defendant No. 1 was not
ready and willing to perform his part of the contract. For
reasons best known to the plaintiff, he did not act upon and
waited for almost 1 year and 10 months from the issuance of
the notice and getting the reply from Defendant No. 1, but
filed the suit on 2nd August 2023 claiming various reliefs in
the suit, including seeking performance of the agreement to
sell as well as the memorandum of understanding executed
between the parties. Defendant No. 1 has appeared and filed
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two written statements whereby he denied the claim of the
plaintiff.
4.6. It further appears that the cause for filing the suit
seems accrued around year 2023 as for the fact of the matter
that suit land starts developed by Defendant No. 1, and its
brochure, submitted with the plaint, shows that Defendant No.
1 has an intention to develop the suit land independently and
or with someone else.
4.7. The plaintiff at the initial stage submitted and prayed
for an ad-interim injunction, which was refused by the Trial
Court and also by this Court. Thereafter, the plaintiff
proceeded with the injunction application filed below Exhibit 5
in the suit.
4.8. After hearing the respective parties and after
appreciating the facts and evidence on record, the Trial Court,
vide its impugned order, has rejected the injunction
application.
5. Thus, in view of the aforesaid facts and the order passed
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by the Trial Court, the present appeal has been filed at the
instance of the original plaintiff.
6. SUBMISSIONS OF THE APPELLANT-PLAINTIFF
6.1. Learned advocate Mr. S.N. Kikani would respectfully
submit that the Trial Court has not at all appreciated the facts
of the case and has made unwarranted observations as regards
the intention of the parties by ignoring the fact that an
agreement to sell was in fact executed between the plaintiff
and Defendant No. 1, which remains undisputed.
6.2. Learned advocate Mr. Kikani would further submit that
once the agreement to sell, which is a registered one, is not
disputed and payments are being made to Defendant No. 1, as
a corollary, an injunction ought to have been granted in a suit
for specific performance.
6.3. Learned advocate Mr. Kikani would further submit that
the terms of the Memorandum of Understanding would stand
on a different footing from the agreement to sell, and the
claim of the plaintiff on the strength of both these agreements
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stood on a different footing, for which an injunction as prayed
for cannot be denied.
6.4. Learned advocate Mr. Kikani would further submit that
if third-party rights are going to be created by Defendant No.
1, as he has an intention to develop the suit property
independently or with the help of some other third party, the
right of the plaintiff would be frustrated and there would be a
case of multiplicity of proceedings, which was unnoticed by
the Trial Court.
6.5. Learned advocate Mr. Kikani would further submit that
merely because the plaintiff has filed the suit after some
passage of time from the denial/refusal of Defendant No. 1 to
perform his part of the agreement would not disentitled the
plaintiff to secure the injunction as prayed for.
6.6. Learned advocate Mr. Kikani would submit that as per
the settled legal position of law, when an agreement to sell
and part performance do not remain in dispute, an injunction
would follow in a suit for specific performance.
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6.7. To buttress his argument, learned advocate Mr. Kikani
would rely upon a decision of the Honourable Supreme Court
in the case P.Ramasubbamma Vs. V. Vijaralakshmi reported in
(2002) 7 SCC 384.
6.8. Making the above submissions, learned advocate Mr.
Kikani would request this Court to allow the present
application.
7. No other and further submissions are made.
8. ANALYSIS
9. Before adverting to the issue germane in this appeal, at
the outset, I would like to refer few decisions of the Hon'ble
Apex Court, whereby it has defined the scope and ambit of
interference of this Court while exercising its appellate
jurisdiction under Order 43 of CPC .
10. First, I would like to rely upon the decision of the
Hon'ble Apex Court in the case of (I) Wonder Ltd. And another
vs. Antox India Pvt. Ltd., 1990 Supp1 SCC 727, the Hon'ble
Supreme Court in para-9 of the said decision, after considering
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the scope of Order 43 Rule 1 (r) of the Code in an appeal
wherein, the discretionary order passed by the learned trial
Court is under challenge, observed as under:-
"9. Usually, the prayer for grant of an interlocutory injunction is at a stage when the existence of the legal right asserted by the plaintiff and its alleged violation are both contested and uncertain and remain uncertain till they are established at the trial on evidence. The court, at this stage, acts on certain well settled principles of administration of this form of interlocutory remedy which is both temporary and discretionary. The object of the interlocutory injunction, it is stated "...is to protect the plaintiff against injury by violation of his rights for which he could not adequately be compensated in damages recoverable in the action if the uncertainty were resolved in his favour at the trial. The need for such protection must be weighed against the corresponding need of the defendant to be protected against injury resulting from his having been prevented from exercising his own legal rights for which he could not be adequately compensated. The court must weigh one need against another and determine where the "balance of convenience lies".
The interlocutory remedy is intended to preserve in status quo, the rights of parties which may appear on a prima facie. The court also, in restraining a defendant from exercising what he considers his legal right but what the plaintiff would like to be prevented, puts into the scales, as a relevant consideration whether the defendant has yet to commence his enterprise or whether he has already been doing so in which latter case considerations somewhat different from those that apply to a case where the defendant is yet to commence his enterprise, are attracted."
(Emphasis supplied)
11. Recently, in the case of Ramakant Ambalal Choksi V/s
Harish Ambalal Choksi, 2024 SCCOnline SC 3538, Hon'ble
Apex Court again reiterated aforesaid principle, albeit with
explaining what amounts to perversity in order having so
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observed as under which reads as under :-
"27. The principles of law explained by this Court in Wander's (supra) have been reiterated in a number of subsequent decisions of this Court. However, over a period of time the test laid down by this Court as regards the scope of interference has been made more stringent. The emphasis is now more on perversity rather than a mere error of fact or law in the order granting injunction pending the final adjudication of the suit.
28. In Neon Laboratories Ltd. v. Medical Technologies Ltd., 2016 2 SCC 672 this Court held that the Appellate Court should not flimsily, whimsically or lightly interfere in the exercise of discretion by a subordinate court unless such exercise is palpably perverse. Perversity can pertain to the understanding of law or the appreciation of pleadings or evidence. In other words, the Court took the view that to interfere against an order granting or declining to grant a temporary injunction, perversity has to be demonstrated in the finding of the trial court.
29. In Mohd. Mehtab Khan v. Khushnuma Ibrahim Khan, 2013 9 SCC 221 this Court emphasised on the principles laid down in Wander (supra) and observed that while the view taken by the appellate court may be an equally possible view, the mere possibility of taking such a view must not form the basis for setting aside the decision arrived at by the trial court in exercise of its discretion under Order 39 of the CPC. The basis for substituting the view of the trial court should be malafides, capriciousness, arbitrariness or perversity in the order of the trial court. The relevant observations are extracted below:
"20. In a situation where the learned trial court on a consideration of the respective cases of the parties and the documents laid before it was of the view that the entitlement of the plaintiffs to an order of interim mandatory injunction was in serious doubt, the Appellate Court could not have interfered with the exercise of discretion by the learned Trial Judge unless such exercise was found to be palpably incorrect or untenable. The reasons that weighed with the learned Trial Judge, as already noticed, according to us, do not indicate that the view taken is not a possible view. The Appellate Court, therefore, should not have substituted its views in the matter merely on the ground that in its opinion the facts of the case call for a different conclusion. Such an exercise is not the correct parameter for exercise of jurisdiction while hearing an appeal against a discretionary order. While
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we must not be understood to have said that the Appellate Court was wrong in its conclusions what is sought to be emphasized is that as long as the view of the trial court was a possible view the Appellate Court should not have interfered with the same following the virtually settled principles of law in this regard as laid down by this Court in Wander Ltd. v.Antox India (P) Ltd."
32. The appellate court in an appeal from an interlocutory order granting or declining to grant interim injunction is only required to adjudicate the validity of such order applying the well settled principles governing the scope of jurisdiction of appellate court under Order 43 of the CPC which have been reiterated in various other decisions of this Court. The appellate court should not assume unlimited jurisdiction and should guide its powers within the contours laid down in the Wander (supra) case".
(emphasis supplied)
12. The facts, which are noted hereinabove, are not in
dispute. The agreement to sell (ATS) and the MoU were both
executed in the year 2015, whereas for the first time, at least
on record, the plaintiff issued a notice calling upon Defendant
No. 1 to perform his part of the contract on 25th October
2021, which was refused by Defendant No. 1 vide his reply
dated the 10th of November 2021. The caveat of Defendant
No. 1, filed in the Court in the year 2021, itself shows that he
is not ready and willing to perform his part of the contract.
No plausible explanation is forthcoming from the side of the
plaintiff for not filing the suit for performance until after about
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1 year and 10 months from the issuance of such notice and
reply.
13. This fact would clearly show that the plaintiff remained
quiet for a long time, and considering the fact that the
agreement to sell/MoU was executed in 2015, the last payment
as per the case of the plaintiff was made in 2018, and the
notice was issued in the year, 2021, and the suit came to be
filed in the year 2023, when viewed together, lead to one
conclusion: that due to delay and laches on the part of the
plaintiff, he was rightly denied the injunction as prayed for.
14. Now, the law on the issue germane to the present appeal
as regards delay and laches as a ground for refusing an
injunction in favour of the plaintiff is no longer res integra,
having been decided by the Honourable Supreme Court of
India and this Court, which are as follows:-
14.1. It would be apt to refer and rely upon the decision of
Hon'ble Apex Court in a case of in the case of Mandali
Ranganna vs. T. Ramachandra, 2008 11 SCC 1, wherein
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Hon'ble Apex Court held as under:-
"[21] While considering an application for grant of injunction, the court will not only take into consideration the basic elements in relation thereto, viz., existence of a prima facie case, balance of convenience and irreparable injury, it must also take into consideration the conduct of the parties.
[22]. Grant of injunction is an equitable relief. A person who had kept quiet for a long time and allowed another to deal with the properties exclusively, ordinarily would not be entitled to an order of injunction. The court will not interfere only because the property is a very valuable one. We are not however, oblivious of the fact that grant or refusal of injunction has serious consequence depending upon the nature thereof. The courts dealing with such matters must make all endeavours to protect the interest of the parties. For the said purpose, application of mind on the part of the courts is imperative. Contentions raised by the parties must be determined objectively."
(emphasis supplied)
14.2. At this stage, it is also apposite to refer to the
decision of this Court (Hon'ble Mr. Justice H.L. Gokhale, as
His Lordships then was) in the case of Veetrag Holding Co.
Ltd. Vs. Gujarat State Textile Corporation Ltd., 1996 3 GLR
536, more particularly in Para-8, which reads as under :-
"8. Even so, in any case, inasmuch as this contract was terminated on 6th December 1993, it was expected of the appellant to move for specific performance at the earliest, if they were serious about the same. The appellants certainly cannot be non-suited on the ground of limitation inasmuch as their suit is within time. However, when it comes to grant of equitable relief when the suit is filed after such a lapse of time, it cannot be said that the remedy of interim injunction was the necessary remedy and there was no other remedy available to the party concerned in this behalf. Shri Gupta relied upon the Apex Court judgment rendered in Dalpat Kumar and Anr. v. Prahlad Singh and Ors. thereof the Courts are cautioned and required to exercise sound judicial discretion. They are required to find out that no other remedy is available to the party concerned and then as stated by the
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Honourable Supreme Court (and again relied upon by Shri Gupta) in para 20 of the judgment of the Apex Court rendered in State of Maharashtra v. Digambar; for approaching a Court of equity, the blameworthy conduct of a person approaching a Court of equity, for obtaining discretionary relief disentitles him for grant of such relief. Para 20 of the above judgment reads as under:
Laches or undue delay, the blameworthy conduct of a person in approaching a Court of equity in England for obtaining discretionary relief which disentitled him for grant of such relief was explained succinctly by Sir Barnes Peacock, long ago, in Lindsay Petroleum Co. v. Hurd, thus:
Now the doctrine of laches in Courts of Equity is not an arbitrary or a technical doctrine. Where it would be practically unjust to give a remedy, either because the party has, by his conduct, done that which might fairly be regarded as equivalent to a waiver of it, or where by his conduct and neglect he has, though perhaps not waiving that remedy, yet put the other party in a situation, in which it would not be reasonable to place him if the remedy were afterwards to be asserted, in either of these cases, lapse of time and delay are most material. But in every case, if an argument against relief, which otherwise would be just, is founded upon mere delay, that delay of course not amounting to a bar by any statute or limitations, the validity of that defence must be tried upon principles substantially equitable. Two circumstances, always important in such cases, are, the length of the delay and the nature of the acts done during the interval, which might affect either party and cause a balance of justice or injustice in taking the one course or the other, so far as it relates to the remedy."
(emphasis supplied)
14.3. Recently also, Hon'ble Apex Court in the case of
Ambalal Sarabhai Enterprise Limited vs. K.S.Infraspace LLP Ltd.
and another, 2020 5 SCC 410, wherein held as under :-
"19. In a matter concerning grant of injunction, apart from the existence of a prima facie case, balance of convenience, irreparable injury, the conduct of the party seeking the equitable relief of injunction is also very essential to be considered as observed in Motilal Jain (supra) holding as follows :
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"6. The first ground which the High Court took note of is the delay in filing the suit. It may be apt to bear in mind the following aspects of delay which are relevant in a case of specific performance of contract for sale of immovable property:
(i) delay running beyond the period prescribed under the Limitation Act;
(ii) delay in cases where though the suit is within the period of limitation, yet:
(a) due to delay the third parties have acquired rights in the subject matter of the suit;
(b) in the facts and circumstances of the case, delay may give rise to plea of waiver or otherwise it will be inequitable to grant a discretionary relief."
22. In M.P.Mathur vs. DTC, 2006 13 SCC 706, this Court observed :
"14. The present suit is based on equity In the present case, the plaintiffs have sought a remedy which is discretionary. They have instituted the suit under Section 34 of the 1963 Act. The discretion which the court has to exercise is a judicial discretion. That discretion has to be exercised on well-settled principles. Therefore, the court has to consider the nature of obligation in respect of which performance is sought, circumstances under which the decision came to be made, the conduct of the parties and the effect of the court granting the decree. In such cases, the court has to look at the contract. The court has to ascertain whether there exists an element of mutuality in the contract. If there is absence of mutuality the court will not exercise discretion in favour of the plaintiffs. Even if, want of mutuality is regarded as discretionary and not as an absolute bar to specific performance, the court has to consider the entire conduct of the parties in relation to the subject-matter and in case of any disqualifying circumstances the court will not grant the relief prayed for (Snell's Equity, 31st Edn., p.366)...."
23. Wander Ltd. (supra) prescribes a rule of prudence only. Much will depend on the facts of a case. It fell for consideration again in Gujarat Bottling Co. Ltd. vs. Coca Cola Co., 1995 5 SCC 545, observing as follows :
"47....Under Order 39 of the Code of Civil Procedure,
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jurisdiction of the Court to interfere with an order of interlocutory or temporary injunction is purely equitable and, therefore, the Court, on being approached, will, apart from other considerations, also look to the conduct of the party invoking the jurisdiction of the Court, and may refuse to interfere unless his conduct was free from blame. Since the relief is wholly equitable in nature, the party invoking the jurisdiction of the Court has to show that he himself was not at fault and that he himself was not responsible for bringing about the state of things complained of and that he was not unfair or inequitable in his dealings with the party against whom he was seeking relief. His conduct should be fair and honest...."
(emphasis supplied)
15. Thus, in view of the aforesaid, the plaintiff is not entitled
to an injunction as prayed for as its suffers from delay/laches
on part of plaintiff note acted upon in reasonable time.
16. Furthermore, it is also on record that Defendant No. 1
has started developing the suit land, and a brochure of the
same was submitted to that effect by the plaintiff on the
record of the suit. Nothing further has been clarified from the
side of the plaintiff as to when such development took place.
17. Be that as it may, once Defendant No. 1 has started
developing the land and third-party rights might have already
been created, and at this stage, the plaintiff wakes up from
slumber and approaches the Trial Court with a prayer to grant
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an injunction, which is a discretionary relief, according to my
view, considering the aforesaid peculiar facts and circumstances
of the case, the injunction so refused by the Trial Court cannot
be said to be erroneous, perverse or arbitrary.
18. This Court has limited power to interfere with impugned
order while exercising its appellate power under Order 43,
Rule 1 of the CPC. At last, the scope an ambit of the present
appeal is well defined by the Hon'ble Supreme Court of India
in the case of Wander Ltd. (supra) and Ramakant Ambalal
Chokshi (supra) wherein it has been clearly held that unless
reasons assigned by Trial Court while granting and or refusing
injunction are erroneous, perverse, arbitrary and contrary to
provision of law, Appellant Court while exercising its power
under order 43, Rule 1 of CPC should not interfere with such
order. Even otherwise, merely a second view is possible to be
taken, would not be a ground to interfere with the impugned
order.
19. So far as the other aspect of the matter, as to what is
the real intention between the parties while entered into
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agreements is concern, as on the one hand the plaintiff entered
into an agreement to sell and on the same day, entered into a
memorandum of understanding, it is to be gone into by the
Trial Court once the trial has commenced.
20. It may be true that the real intention of the plaintiff was
not to obtain the ownership of the land but to develop the
property with the help of Defendant No. 1, who has an
undivided share in the suit property. There are other co-
owners of the property, i.e., Defendants No. 2 to 4.
21. To perform such the agreement, the consent of all other
co-owners would have been required, this fact was in
knowledge of the plaintiff as he was quite aware about it
when he executed the said agreement to sell and/or
memorandum of understanding.
22. At this stage, it would be apt to rely upon the decision
of the Honourable Supreme Court in the case of Pemmada
Prabhakar and others vs. Youngmen's Vysya Association and
others reported in (2015) 5 SCC 355:-
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"28. It is an undisputed fact that the suit schedule property is self-
acquired property by late Pemmada Venkateswara Rao as he had purchased the said property vide sale deed Document No. 5174 of 1970 dated 24-11-1970 from his vendors. It is also an undisputed fact that the said property is intestate property. He is survived by his wife, three sons and three daughters. The said property devolved upon them in view of Section 8 of Chapter II of the Hindu Succession Act as the defendants are Class I legal heirs in the suit schedule property. Undisputedly, the agreement of sale, Ext. A- 1 is executed only by Defendants 1 and 2. The third son, mother and three sisters who have got equal shares in the property have not executed the agreement of sale. In view of the matter, the agreement of sale executed by Defendants 1 and 2 who have no absolute right to property in question cannot confer any right whatsoever upon the plaintiffs for grant of decree of specific performance of agreement of sale in their favour. The said agreement is not enforceable in law in view of Section 17 of the Specific Relief Act in view of the right accrued in favour of Defendants 3 to 6 under Section 8 of the Hindu Succession Act.
29. The provisions of Section 17 of the Specific Relief Act in categorical terms expressly state that a contract to sell or let any immovable property cannot be specifically enforced in favour of a vendor or lessor who does not have an absolute title and right upon the property. It is worthwhile to extract Section 17 of the Specific Relief Act, 1963 here:
"17.Contract to sell or let property by one who has no title, not specifically enforceable.--(1) A contract to sell or let any immovable property cannot be specifically enforced in favour of a vendor or lessor--
(a) who, knowing not to have any title to the property, has contracted to sell or let the property;
(b) who, though he entered into the contract believing that he had a good title to the property, cannot at the time fixed by the parties or by the court for the completion of the sale or letting, give the purchaser or lessee a title free from reasonable doubt."
In view of the aforesaid provisions of the Specific Relief Act, the agreement of sale entered into between the plaintiffs and some of the co-sharers who do not have the absolute title to the suit schedule property is not enforceable in law. This aspect of the matter has not been properly
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appreciated and considered by both the first appellate court and the second appellate court. Therefore, the impugned judgment is vitiated in law.
30. Even assuming for the sake of argument that the agreement is valid, the names of three sons are mentioned in the agreement of sale, out of whom the agreement is executed by Defendants 1 and 2 and they assured that they would get the signatures of the third brother, namely, Srinivasa Rao and also of the remaining three sisters. At the time of execution of this agreement signatures were not obtained. Therefore, the agreement is not executed by all the co-sharers of the property which fact is evident from the recitals of the document itself. Hence, the plaintiffs are not entitled for specific performance decree. This vital factual and legal aspect has been ignored by both the first appellate court and the second appellate court. Therefore, the impugned judgment is vitiated both on facts and law. Accordingly, Point (i) is answered in favour of the defendants."
(Emphasis supplied)
23. Prima facie, in view of the aforesaid ratio of the
Honourable Apex Court, if applied to the facts of the present
case, when undisputedly, Defendant No. 1 has a ¼ share in
the suit property and there are other co-sharers, i.e.,
Defendants No. 2 to 4, who are not party to any of such
agreements, i.e., the agreement to sell and/or memorandum of
understanding, the plaintiff may not be able to get the relief of
specific performance of the agreements. This would also be one
of the factors to be considered while not entertaining the
injunction application of the plaintiff by this Court.
24. So far as the decision in the case of P. Ramasubbamma
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(Supra) relied upon by learned advocate Mr. Kikani is
concerned, it would not be applicable to the issue germane to
the present appeal, in as much as after a full-fledged trial, the
matter went up to the Supreme Court and in light of the facts
of that case, the Supreme Court answered the issue
accordingly. As far as the present appeal is concerned, it is
confined only to granting an injunction in favour of the
plaintiff at the preliminary stage of the suit proceedings.
25. At this stage, learned advocate Mr. Kikani requests this
Court that the Trial Court may not be influenced by the order
passed by this Court while deciding the suit in question.
26. It goes without saying that the reasons recorded either by
the Trial Court or by this Court while deciding the injunction
application and the appeal will not affect any of the parties to
the suit proceedings. The Trial Court is required to decide the
lis between the parties as per the evidence that comes forth on
the record of the suit.
27. CONCLUSION
27.1. Thus, in view of the aforesaid facts and circumstances
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of the case and applying the ratio of the above-referred
decisions of the Honourable Supreme Court to the present case,
I do not find any reason to interfere with the order impugned
in the present appeal, having not found it to be either
erroneous, perverse or arbitrary.
27.2. The appeal lacks merits and is required to be
dismissed, which is hereby DISMISSED. No order as to costs.
The Civil Application is also disposed of accordingly.
(MAULIK J.SHELAT,J) MOHD MONIS
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