Madras High Court
K.Jayapal vs Brij Khandelwal on 2 June, 2025
2025:MHC:1298
CMA.Nos.989 and 990 of 2025
IN THE HIGH COURT OF JUDICATURE AT MADRAS
RESERVED ON : 29.04.2025
PRONOUNCED ON :02.06.2025
CORAM
THE HONOURABLE MR.JUSTICE S.SOUNTHAR
CMA.Nos.989 and 990 of 2025
and CMP.Nos.7921, 7926 and 7931 of 2025
CMA.No.989 of 2025:
K.Jayapal ... Appellant
Vs.
1.Brij Khandelwal
2.M/s.Star Square Feet Ventures LLP,
Rep. by its Managing Partner Mr.N.Sreedhar,
having office at No.57, Ormes Road, Kilpauk,
Chennai – 600 010.
... Respondents
Civil Miscellaneous Appeal filed under Order XLIII Rule 1 of CPC,
praying to allow the above CMA by setting aside the order and decreetal
order dated 12.11.2024 passed by the Sessions Judge, Mahila Court,
Chengalpattu, in I.A.No.4 of 2024 in I.A.No.3 of 2024 in O.S.No.209 of
2024.
For Appellant :Mr.N.Sivaprakash
For Respondents :Mr.T.P.Manoharan
Senior Advocate
for M/s.G.Bavithra Selia
1/22
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CMA.Nos.989 and 990 of 2025
CMA.No.990 of 2025:
K.Jayapal ... Appellant
Vs.
1.Brij Khandelwal
2.M/s.Star Square Feet Ventures LLP,
Rep. by its Managing Partner Mr.N.Sreedhar,
having office at No.57, Ormes Road, Kilpauk,
Chennai – 600 010.
... Respondents
Civil Miscellaneous Appeal filed under Order XLIII Rule 1 of CPC,
praying to allow the above CMA by setting aside the order and decreetal
order dated 12.11.2024 passed by the Sessions Judge, Mahila Court,
Chengalpattu, in I.A.No.3 of 2024 in O.S.No.209 of 2024.
For Appellant :Mr.N.Sivaprakash
For Respondents :Mr.T.P.Manoharan
Senior Advocate
for M/s.G.Bavithra Selia
JUDGMENT
These two appeals are filed challenging the fair and final order
passed by the Trial Court in I.A.Nos.3 and 4 of 2024 in O.S.No.209 of
2024, whereunder the trial Court allowed the application for vacating
interim injunction in I.A.No.4 of 2024 and dismissed the application
seeking interim injunction in I.A.No.3 of 2024.
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2. The appellant herein is the plaintiff in the main suit. He
filed a suit for specific performance of sale agreement dated 06.01.2024
against the respondents 1 and 2. According to the appellant/plaintiff, the
first respondent is the owner of the subject matter of the sale agreement.
The appellant entered into a sale agreement with first respondent on
06.01.2024 agreeing to purchase the agreement mentioned property for sale
consideration of Rs.1,82,00,000/-. It was pleaded that an amount of
Rs.5,00,000/- was paid by the appellant to first respondent by way of cash
on 30.12.2023. Further a sum of Rs.10,00,000/- was paid on 06.01.2024 to
first respondent by the appellant by way of money transfer to his account.
Again a further sum of Rs.5,00,000/- was paid by the appellant to first
respondent on 08.01.2024 by way of cash. Therefore, according to the
appellant a sum of Rs.15,00,000/- was paid to first respondent by way of
advance on two days i.e. 30.12.2023, 06.01.2024. It was agreed between
the parties that sale transaction should be completed by paying balance sale
consideration within six months from the date of execution of the sale
agreement (06.01.2024). It was also pleaded that pursuant to the suit sale
agreement, the appellant/plaintiff developed the property by spending
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Rs.5,00,000/-. It was further pleaded that the appellant requested his friend
and mother of his friend to deposit a sum of Rs.50,00,000/- to the account
of the first respondent/defendant in part performance of suit sale agreement.
It is not in dispute that though said amount of Rs.50,00,000/- was paid to
the account of first defendant in two instalments on 22.02.2024 and
29.02.2024, the said amount was returned by the first defendant on the
ground that he did not have any transaction with persons who transferred
the money to his account. Subsequently, violating the terms of the
agreement, the first defendant attempted to alienate the property to third
parties. He also appointed the second respondent herein as his power agent
to deal with his property on 28.02.2024 by way of registered power deed for
consideration. Since the first respondent attempted to wriggle out of
contract, the instant suit for specific performance was filed. Along with the
plaint, the appellant herein filed I.A.No.3 of 2024 seeking temporary
injunction restraining the respondents 1 and 2/defendants 1 and 2 from
alienating or encumbering the agreement mentioned property pending
disposal of the suit. Initially, the Trial Court granted temporary injunction
and thereafter, the first respondent herein filed I.A.No.4 of 2024 seeking
vacation of the interim order. Both the interlocutory applications were
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heard together and the application filed by the first respondent seeking
vacation of the interim order was allowed and the interlocutory application
filed by the appellant seeking temporary injunction was dismissed after
vacating the order. Aggrieved by the said order, these two appeals are filed
by the appellant.
3. The learned counsel appearing for the appellant contended
that the trial Court dismissed the petition for temporary injunction mainly
on the ground that suit agreement was an unregistered agreement and hence
it was not valid one for granting specific performance. The learned counsel
by relying on the judgment of the Apex Court in R.Hemalatha Vs.
Kashthuri reported in AIR 2023 SC 1895 submitted that unregistered sale
agreements can be admitted in evidence in a suit for specific performance
and hence the impugned order passed by the trial Court is liable to be set
aside. The learned counsel further submitted that the first respondent
executed a power of attorney in favour of second respondent empowering
him to sell the subject property with third parties and therefore, the intention
of the first respondent to alienate the property is very well established. In
these circumstances, according to him, the trial Court ought not have
vacated the interim order already granted.
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4. The learned Senior Counsel appearing for the respondents
would submit that the appellant/plaintiff failed to establish that he had
sufficient money in his hands on the date of filing of the suit to complete
the transaction and therefore, the readiness and willingness of the plaintiff
was not at all proved. The learned counsel also submitted that the suit
agreement was dated 06.01.2024 and the stamp papers used in the suit
agreements were dated 21.02.2023 and it creates a suspicion with regard to
the genuineness of the sale transaction. It was vehemently contended by
him that the suit sale agreement was a forged document and therefore, the
plaintiff was not entitled to any interim order. The learned senior counsel
further submitted that the payments of money by the plaintiff's friend and
his mother dated 22.02.2024 and 29.02.2024 were not at all intimated to the
first defendant and hence the same was returned.
5. It is the specific contention of the learned senior counsel for
the respondents/defendants that the plaintiff is only interested in blocking
the suit property and hence the trial Court rightly vacated the interim order
and allowed the vacate injunction petition.
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6. In support of the contention, the learned senior counsel
relied on the following judgments:
(i) P.Ravindranath and another Vs. Sasikala and others
reported in 2024 SCC OnLine SC 1749;
(ii) A.Nawab John and others Vs. V.N.Subramaniyam reported
in (2012) 7 SCC 738;
(iii) Ambalal Sarabhai Enterprise Limited Vs. K.S.Infraspace
LLP Limited and another reported in (2020) 5 SCC 410;
(iv) Thomson Press (India) Limited Vs. Nanak builders and
Investors Private Limited and others reported in (2013) 5 SCC 397;
(v) Usha Sinha Vs. Dina Ram and others reported in (2008) 7
SCC 144.
7. A perusal of the impugned order passed by the Trial Court
would indicate that it has given three reasons for dismissing the petition for
temporary injunction.
(i) Though six months time was fixed in the agreement for
completion of the sale transaction, the suit was filed by the
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appellant/plaintiff even before expiry of the terms fixed in the agreement
and hence the suit was prematured one;
(ii) The suit sale agreement was unregistered one and hence it
was not valid in eye of law;
(iii) The plaintiff failed to establish the readiness and
willingness to perform his part of the contract.
8. A perusal of the pleadings of the parties and the document
relied on by them would establish that the suit sale agreement was entered
into on 06.01.2024 and it was agreed that sale transaction should be
completed within six months. Therefore, the time for performance expires
on 05.06.2024. However, the suit had been filed even before expiry of the
time limit on 08.04.2024.
9. It is seen form the pleadings and also Ex.R10 dated
28.02.2024, the first respondent herein appointed the second respondent as
his power agent empowering him to sell the suit property to the third parties.
Therefore, it is clear that even before expiry of the time limit fixed for
performance of the suit sale agreement, the first respondent attempted to
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alienate the subject matter of the agreement by appointing the second
respondent as his power agent that too for a consideration. The execution
of power deed by the first respondent in favour of the second respondent
indicates the intention of the first respondent to wriggle out of contract and
alienate the property to the third party. Therefore, immediately after
acquiring knowledge about the intention of the first respondent to alienate
the property to the third parties, the present suit has been filed by the
appellant. When one of the party to the contract had taken steps to violate
the terms of contract by attempting alienation, the other party need not wait
for expiry of the time limit fixed in the agreement and therefore, the
observation made by the trial Court, as if, the present suit filed by the
appellant before expiry of the terms fixed in the agreement is a prematured
one is not acceptable to this Court. The attempt made by the first
respondent to alienate the property to the third parties by appointing the
power agent compelled the appellant to file a suit seeking specific
performance even before expiry of the term fixed in the agreement. Hence,
the said reasoning given by the trial Court is not a sound one.
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10. The trial Court also recorded a finding that the suit sale
agreement is an unregistered one and hence invalid in the eye of law. The
Apex Court in R.Hemalatha Vs.Kashthuri reported in
Manu/SC/0344/2023:AIR 2023 SC 1895 by relying on proviso to Section
49 of the Registration Act, held that unregistered agreement can very well
be admitted in evidence in a suit for specific performance. The relevant
observation of the Apex Court reads as follows:
“13. Under the circumstances, as per proviso to Section
49 of the Registration Act, an unregistered document affecting
immovable property and required by Registration Act or
the Transfer of Property Act to be registered, may be received
as evidence of a contract in a suit for specific performance
under ChapterII of the Specific Relief Act, 1877, or as
evidence of any collateral transaction not required to be
effected by registered instrument, however, subject to Section
17(1A) of the Registration Act. It is not the case on behalf of
either of the parties that the document/ Agreement to Sell in
question would fall under the category of document as
per Section 17(1A) of the Registration Act. Therefore, in the
facts and circumstances of the case, the High Court has rightly
observed and held relying upon proviso to Section 49 of the
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Registration Act that the unregistered document in question
namely unregistered Agreement to Sell in question shall be
admissible in evidence in a suit for specific performance and
the proviso is exception to the first part of Section 49.”
11. The very same view was taken by the Division Bench of
this Court in R.Ananda Padmanabhan and others Vs. R.Vadivel Gounder
and others reported in MANU/TN/3059/2019 and K.Manoharan and
others Vs. T.Janaki ammal and others reported in MANU/TN/1502/2012.
12. In K.Manoharan and others Vs. T.Janaki ammal and
others cited supra, a Division Bench of this Court held that an unregistered
agreement could be relied on for the purpose of granting relief of injunction
against alienation. The relevant observation reads as follows:
“37. It is not as if all the agreements for sale
referring to instance of delivery of possession shall be
compulsorily registered u/s 17(1-A) of Indian Registration
Act. Only when the Agreement for Sale which speaks about
delivery of possession is filed to claim benefit of "part
performance" as contemplated u/s 53-A of Transfer of
Property Act, Court will have to find out whether the
document was registered or not. If such document was not
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registered, then the benefit of Section 53-A of Transfer of
Property Act cannot be claimed by the prospective purchaser
of the property. [Vide R. Palanisubramanian Vs. Trans
Medica (India) Ltd. and Another, MANU/TN/1598/2009 : AIR
2009 Mad 110]. We fully endorse the said views of the
learned Single Judge.
38. In the case on hand, Plaintiff is not seeking
for protection or claiming benefit u/s 53-A of Transfer of
Property Act. Plaintiff has only sought for permanent
injunction restraining the Defendants 1 to 3 from in any way
alienating the property. Such relief sought for is an
independent of the clause of handing over possession to the
Plaintiff. That being so, there is no embargo for the Plaintiff
to rely upon Ex. A1-Agreement of Sale. Trial Court must
construe the provisions of Section 17(1-A) of Indian
Registration Act.”
It is also pertinent to mention that as per suit sale agreement,
possession was not handed over to the purchaser on the date of agreement
and it was agreed that possession would be delivered only on the date of
registration of sale deed.
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13. In view of the law settled by the Apex Court that
unregistered sale agreement can be relied on as evidence of agreement of
sale in a suit for specific performance, the findings rendered by the trial
Court that the suit sale agreement is invalid for want of registration is
untenable in law.
14. The Trial Court also observed that the plaintiff failed to
prove his readiness and willingness to perform his part of the agreement. It
is settled law that in a suit for specific performance, the plaintiff has to
establish his readiness and willingness from the inception of agreement till
the date of decree. In fact, the learned senior counsel for the respondents
relied on various decisions in support of his contention that the plaintiff
failed to establish his readiness and willingness. With regard to the
proposition of law that the plaintiff must establish his readiness and
willingness in a suit for specific performance is concerned, it is very well
settled and nobody can have any quarrel with that proposition. The
readiness and willingness of the plaintiff is a question of fact which can be
established only during full trial in a suit for specific performance. At this
stage, this Court is only concerned with prima facie case, balance of
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convenience and irreparable injury to the plaintiff, in case of refusal of
interim prayer. It may not be appropriate to expect the plaintiff to prove his
readiness and willingness even at the stage of considering the interlocutory
application. The points raised by the learned Senior Counsel for the
respondents with regard to the readiness and willingness can very well be
agitated by him at the time of final disposal of the suit.
15. It is the specific case of the respondents that the suit sale
agreement was a forged one. It is also stated that already the first
respondent has filed an application seeking comparison of the signature
found in the sale agreement with his admitted signature. Whether the suit
sale agreement is a forged one or not is also a disputed question of fact
which can be established only at the time of final disposal of the suit. In
the case on hand, the suit sale agreement has been produced by the plaintiff
and the same was marked as Ex.R1 in vacate interim injunction petition.
Ex.R4 is the statement of accounts relating to bank account of the plaintiff.
16. A perusal of the same would indicate that a sum of
Rs.10,00,000/- was transferred to the bank account of the first respondent
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on 06.01.2024. The payment of Rs.10,00,000/- by the plaintiff on the date
of agreement to the first respondent was also admitted by the first
respondent. However, it was explained that the appellant was involved in
real estate business and as per the prevailing practice in real estate
business, at the time of handing over xerox copies of the title document to
the appellant to enable him to procure prospective purchaser, a sum of
Rs.10,00,000/- was collected by the first defendant from the appellant.
Therefore, it is clear that on the date of suit sale agreement, the appellant
paid a sum of Rs.10,00,000/- to the first respondent by bank transfer.
Whether it was paid as part of the advance towards the suit sale agreement
or as a token amount for the purpose of getting xerox copies of the title
documents as contented by the first respondent is again a disputed question
of fact which can be determined only at the time of final disposal of the suit.
Ex.R1, suit sale agreement r/w Ex.R4 statement of bank accounts would
establish that there was a transaction between the appellant and the first
respondent with regard to the subject matter of the agreement. The
appellant contends that he entered into a sale agreement under Ex.R1. The
first respondent contends that he received a sum of Rs.10,00,000/- as a
token amount at the time of handing over copies of title document to the
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appellant to enable him to procure prospective purchaser. The disputed
question of facts arising for consideration in this case regarding the alleged
forgery of the suit sale agreement, true nature of the transaction between the
appellant and the first respondent and the readiness and willingness of
appellant/plaintiff etc., can be decided only at the time of final disposal.
The documentary evidence available on record namely Exs.R1 and R4
prima facie establish the case of the plaintiff regarding suit sale agreement.
Ex.R10 certified copy of General Power of Attorney executed by the first
respondent in favour of second respondent on 28.02.2024 would establish
that even before expiry of the time fixed in the suit sale agreement, the first
respondent attempted to alienate the property by appointing a power of
attorney. It clearly establishes the intention of the first respondent to
alienate the subject matter of the agreement to the third parties. If
injunction is not granted and the first respondent is allowed to encumber the
subject matter of the agreement, unnecessarily the third party rights will be
created and alienation of the agreement mentioned property pending suit
for specific performance will unnecessarily bring the third party to the
litigation and complicate the issue and also lengthen the litigation.
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17. It was vehemently contented by the learned senior counsel
appearing for the respondents that doctrine of lis pendens as enshrined
under Section 52 of Transfer of Property Act, will take care of the
appellant/plaintiff and hence the first respondent need not be injuncted from
alienating the subject property to the third properties.
18. In this regard, it would be appropriate to refer to the recent
judgment of the Apex Court in Ramakant Ambalal Choksi Vs.Harish
Ambalal Choksi and others reported in 2024 INSC 913. The relevant
observation of the Apex Court reads as follows:
“45.Quite often, in these types of litigations, it is
sought to be argued that an injunction restraining the
defendant from transferring the suit property was absolutely
unnecessary as no post-suit transfer by the defendant can
adversely affect the result of the suit because of the
provisions of Section 52 of the T. P. Act whereunder all such
transfers cannot but abide by the result of the suit. It is true
that the doctrine of lis pendens as enunciated in Section 52
of the T. P. Act takes care of all pendente lite transfers; but
it may not always be good enough to take fullest care of the
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plaintiffs interest vis-a-vis such a transfer. We may give one
appropriate illustration of a suit for specific performance of
contract based on an agreement of sale. In a suit wherein
the plaintiff prays for specific performance and if the
defendant is not restrained from selling the property to a
third party and accordingly a third party purchases the
same bona fide for value without any notice of the pending
litigation and spends a huge sum for the improvement
thereof or for construction thereon, the equity in his favour
may intervene to persuade the Court to decline, in the
exercise of its discretion, the equitable relief of specific
performance to the plaintiff at the trial and to award
damages only in favour of the plaintiff. It must be noted that
Rule 1 of Order 39 of the Code clearly provides for interim
injunction restraining the alienation or sale of the suit
property and if the doctrine of lis pendens as enacted in
Section 52 of the T. P. Act was regarded to have provided
all the panacea against pendente lite transfers, the
Legislature would not have provided in Rule 1 for interim!
injunction restraining the transfer of suit property. Rule 1 of
Order 39, in our view, clearly demonstrates that,
notwithstanding the Rule of lis pendens in Section 52 of the
T. P. Act, there can be occasion for the grant of injunction
restraining pendente lite transfers in a fit and proper case.
(See: Sm. Muktakesi Dawn and Ors. v. Haripada Mazumdar
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and Anr. reported in AIR 1988 Cal 25). (emphasis supplied
by this Court)
46.In the aforesaid context, we may refer to one old
decision of the Calcutta High Court in Promotha Nath Roy
v. Jagannath Kisore Lal Singh Deo reported in (1912) 17
Cal LJ 427 where it has been observed that a Court will in
many cases interfere and preserve property in status quo
during the pendency of a suit in which the rights to it are to
be decided and though the purchaser pendente lite would
not gain title, the Court will prevent by injunction the
embarrassment that would be caused to the original
purchaser in his suit against the vendor. And it has been
ruled there on the authority of Turner, LJ in Hadley v.
London Bank of Scotland, reported in (1865) 3 De GJ & S
63 at 70 that if there is a clear valid contract for transfer,
the Court will not permit the transferor afterwards to
transfer the legal estate to third person, although such third
person would be affected by lis pendens. Mr. Muhkerjee has
drawn our attention to Dr. S. C. Banerji's Tagore Law
Lectures on Specific Relief (2nd Edition, page 592) where
the decision in Promotha Nath (supra) has been
approvingly referred to and also to Fry's Treatise on
Specific Performance (6th Edition) where the same Rule has
been enunciated as a general principle on the authority of
Turner, L.J., in Hadley (supra).
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47.Today, all that we say is that having regard to the
nature of dispute between the parties and the materials on
record, the property should not change hands any further.”
19. Therefore, it is clear that notwithstanding the doctrine of
lis pendens, in appropriate case, the Court can grant an order of injunction
against alienation, in order to maintain the status-quo and to prevent
unnecessary complication in the litigation by creation of third party interest
which will unduly lengthen the life of litigation.
20. In the case on hand, Ex.R1-suit sale agreement, R4-
statement of bank accounts relating to bank account of plaintiff and
Ex.R10-General Power of Attorney executed by the first respondent in
favour of second respondent clearly establish the prima facie case in favour
of the appellant. The General Power of Attorney executed by the first
respondent just prior to filing of the suit establish his intention of alienating
the properties to the third parties, even before expiry of the terms fixed in
the suit sale agreement. Hence, the balance of convenience is also in
favour of the appellant. If the property is allowed to be alienated, the third
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party purchaser will file an impleading application in the pending litigation
which will unnecessarily lengthen the litigation and cause injury to the
plaintiff.
21. In view of the discussions made earlier, the reasonings
given by the trial Court for vacating the interim injunction already granted
are not acceptable to this Court.
22. Accordingly, the impugned fair and final order passed by
the trial Court are set aside. I.A.No.4 of 2024 filed by the first respondent
seeking vacation of the interim injunction stands dismissed. I.A.No.3 of
2024 filed by the appellant seeking interim injunction stands allowed and
the respondents 1 and 2 are injuncted from alienating the subject matter of
the suit sale agreement to third parties pending disposal of the suit.
23. Accordingly, both the appeals stand allowed.
Consequently, connected miscellaneous petitions are closed. No costs.
02.06.2025
Index : Yes/No
Speaking order:Yes/No
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Neutral Citation:Yes/No
ub
S.SOUNTHAR, J.
ub
To
1. The Sessions Judge,
Mahila Court, Chengalpattu
2. The Section Officer
VR Section, High Court, Madras.
Pre-delivery Judgment made in
CMA.Nos.989 and 990 of 2025
02.06.2025
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