1 AOGJR-542.10 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION APPEAL FROM ORDER NO.542 OF 2010 M/s. Kachhi Properties, Satara, a partnership firm, through partner and Power of Attorney Salim Gaffar Kachhi, age 44, Business: Contractor & Builder, Resident of 20/21, Budhwar Peth, Satara, Satara  415 002. .... Appellant - Versus - 1. Ganpatrao Shankarao Kadam, Age 68, Business: Agriculturist 2. Uttam Dinkar Kada, Age: 58, Business: Agriculturist 3. Bhalerao Dinkar Kadam, Age 63, Business: Agriculturist All residents of At & Post: Khed, Chahur (Malvi), Taluka & Dist. Satara .... Respondents WITH APPEAL FROM ORDER NO.543 OF 2010 M/s. Kachhi Properties, Satara, a partnership 2 AOGJR-542.10 firm, through partner and Power of Attorney Salim Gaffar Kachhi, age 44, Business: Contractor & Builder, Resident of 20/21, Budhwar Peth, Satara, Satara  415 002. .... Appellant - Versus - 1. Mahendra Uttamrao Kadam, Age 27, Business: Agriculturist 2. Amit Uttamrao Kadam, Age: 20, Business: Agriculturist 3. Amol Bhalerao Kadam, Age 20, Business: Education/Agriculturist All residents of At & Post: Khed, Chahur (Malvi), Taluka & Dist. Satara .... Respondents APPEAL FROM ORDER NO.544 OF 2010 M/s. Kachhi Properties, Satara, a partnership firm, through partner and Power of Attorney Salim Gaffar Kachhi, age 44, Business: Contractor & Builder, Resident of 20/21, Budhwar Peth, Satara, Satara  415 002. .... Appellant - Versus - 3 AOGJR-542.10 Ganpatrao Shankarao Kadam, Age 68, Business: Agriculturist, resident of At & Post: Khed, Chahur (Malvi), Taluka & Dist. Satara .... Respondent AND APPEAL FROM ORDER NO.545 OF 2010 M/s. Kachhi Properties, Satara, a partnership firm, through partner and Power of Attorney Salim Gaffar Kachhi, age 44, Business: Contractor & Builder, Resident of 20/21, Budhwar Peth, Satara, Satara  415 002. .... Appellant - Versus - 1. Mahendra Uttamrao Kadam, Age 27, Business: Agriculturist 2. Amit Uttamrao Kadam, Age: 20, Business: Agriculturist 3. Amol Bhalerao Kadam, Age 20, Business: Education/Agriculturist All residents of At & Post: Khed, Chahur (Malvi), Taluka & Dist. Satara .... Respondents 4 AOGJR-542.10 S/Shri R.A. Thorat with Ravi Kadam for the Appellant in all above Appeals. Shri Nilesh Patil for the Respondents in all above Appeals. WITH APPEAL FROM ORDER NO.330 OF 2010 Ravindra Shivram Sarode, Age: 42 years, Occ: Business & Agriculture, r/o Shilapur, Tal. & Dist. Nashik. .... Appellant - Versus - Pandurang Shankar Gaikwad, Age: 48 years, Occ: Business & Agricutlure, r/o Shramik Nagar, Station Road, Ghoti, Taluka Igatpuri, District Nashik. .... Respondent Shri M.M. Sathaye for the Appellant. Ms Gauri Godse for the Respondent. AND APPEAL FROM ORDER NO.248 OF 2010 1. Suresh Janu Penkar, Age: 45 years, Occupation: Service 2. Chandrakant Janu Penkar, Age: adult, both residing at C/72, Room No.110, Pratiksha Nagar, Sion Koliwada, Mumbai-400 002. .... Appellants 5 AOGJR-542.10 - Versus - 1. Jitendra Namdev Pednekar, Age: Adult, residing at LM-02, Lotus Co-op.Hsg. Society, A-Wing, 6th Floor, Room No.606 Mhada Colony, Pratiksha Nagar, Sion-Koliwada, Mumbai-400 022. 2. Namdev Vishram Pednekar, Age: Adult, Gurudatta Printers, 228, Bazar Gate Street, in front of Parasi Agayari, Near Cosmos Bank, Fort, Mumbai-400 001. .... Respondents Ms Gauri Godse for the Appellants. Shri Dushyant Pagare for the Respondents. CORAM: R.C. CHAVAN, J. RESERVED ON: JULY 20, 2010 PRONOUNCED ON: AUGUST 3, 2010 JUDGMENT: 1. A common question about the necessity of granting a temporary injunction to restrain a defendant from creating third party interests/alienating the property pending suit, 6 AOGJR-542.10 in the face of provisions of Section 52 of the Transfer of Property Act, 1882 (hereafter referred to as "the TP Act") has been raised in these appeals. It was ably argued by learned counsel for the parties therein, unfolding various facets of the question. Before adverting to the factual aspects, it would be useful to first deal with this question. 2. It is common for plaintiffs in suits related to property to seek temporary injunction only to restrain defendant from alienating the property or creating third party interests, during the pendency of the suit. Such prayers are made mostly in suits for partition and separate possession of shares in joint family property, suits for specific performance of an agreement of sale, development agreement, suits by plaintiffs in possession of property, seeking to avoid a transfer either executed or to be executed, or suits by plaintiffs not in possession of the property transferred to them, where transferor repudiates the transfer, and the like. 3. In such cases, where the plaintiffs may have established a prima facie case, the question that would arise is whether in the 7 AOGJR-542.10 face of provisions of Section 52 of the TP Act, a plaintiff could complain that he would suffer irreparably if an injunction to restrain creation of third party interests is not issued, and could it be held that balance of convenience would lie in favour of granting such an injunction? 4. In the case of Sharad Jamnadharji Mor v. Arjun Yeshwant Dhanwatey & anr., reported in 2009 (4) Bom.C.R. 523, I had held that refusal of temporary injunction by the trial Court need not be interfered with, in view of protection statutorily provided by Section 52 of the TP Act. Arguments advanced in these appeals provided an opportunity to re-examine the question as also the correctness of the logic of judgment in Sharad Mor's case (supra). 5. Before proceeding to consider several judgments cited, it would be useful to quote for ready reference the provisions of Section 52 of the TP Act amended by Bombay Act XIV of 1939. "52. Transfer of property pending suit relating thereto.- (1) During the pendency in any Court having authority within the limits of India excluding the State of Jammu and Kashmir 8 AOGJR-542.10 established beyond such limits by the Central Government, of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, if a notice of the pendency of such suit or proceeding is registered under section 18 of the Indian Registration Act, 1908, the property after the notice is so registered cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein, except under the authority of the court and on such terms as it may impose. (2) Every notice of pendency of a suit or proceeding referred to in sub- section (1) shall contain the following particulars, namely:- (a) the name and address of the owner of immovable property or other person whose right to the immovable property is in question; (b) the description of the immovable property the right to which is in question; (c) the Court in which the suit or proceeding is pending; (d) the nature and title of the suit or proceeding; and (e) the date on which the suit or proceeding was instituted. 9 AOGJR-542.10 Explanation.- For the purposes of this section, the pendency of a suit or proceeding shall be deemed to commence from the date of the presentation of the plaint or the institution of the proceedings in a Court of competent jurisdiction, and to continue until the suit or proceeding has been disposed of by a final decree or order and complete satisfaction or discharge of such decree or order has been obtained, or has become unobtainable by reason of the expiration of any period of limitation prescribed for the execution thereof by any law for the time being in force." (amended portion shown in bold/italics) Section 2 of the Amending Act provides that the Act shall apply to properties situated wholly or partly in the City of Bombay (now Mumbai) from the date of notification in the official gazette (which has been issued) and provides for similar notification extending applicability of the Amending Act to other areas to be issued (which is not shown to have been issued). Thus the amended provisions apply to properties in Mumbai and the unamended section applies to rest of the State. Simultaneously Section 18 of the Registration Act was amended to provide for registration of notices of pending suits. 10 AOGJR-542.10 6. Shri Thorat, learned senior counsel who appeared for the appellants in Appeal From Order No.542 of 2010, not only painstakingly caused all the judgments relevant for deciding the issue being researched and placed for my consideration, he also eruditely elaborated on the pros & cons of holding that a temporary injunction may not be granted in such cases. Additionally, he submitted that if such a proposition has not been laid down for over a hundred years, in spite of the fact that Section 52 of the TP Act is on the statute book since 1882 and Order XXXIX of the Code of Civil Procedure since 1908, there may be no warrant for so holding now. With this preface the cases cited may now be looked into. 7. Advocate Ms Gauri Godse, appearing for the appellants in Appeal From Order No.248 of 2010 cited judgment of a Division Bench of this Court in Nathaji Anandrav Patil v. Nana Sarjerao Patil, reported in 1907 Vol.IX BLR 1173. In that case, the question was not of grant of temporary injunction. One Nathaji had filed a suit against Balubai in 1885 to recover possession of Survey Nos.161 and 162 on the allegation that he was adopted son of Balubai. The suit was dismissed by the Sub-Judge on 11 AOGJR-542.10 22-2-1886 but on appeal, the District Court reversed the judgment and decreed the suit in 1890 and the High Court confirmed the decree on 14-1-1892 but claim of Balubai to Survey Nos. 161 and 162 was expressly excepted and reserved . When the appeal before the District Court was pending, on 14-4-1886 Balubai sold Survey No.161 to Hajarimal. Balubai and Nana filed Suit in 1895 against Nathaji for possession of the land. The trial Court decreed the suit. On appeal, in the District Court, a consent decree was passed in 1898 whereby Survey No.162 went to Balubai and Nana, while Survey No.161 went to Nathaji. In 1905 Hajarimal filed a suit claiming possession of Survey No.161 from Nathaji. The trial Court dismissed Hajarimal's suit holding that purchase by him on 4-1-1886 from Balubai, when an appeal was pending in the District Court was hit by doctrine of lis pendens. On appeal the District Court held that consent decree was not an order in a contentious proceeding so as to extend the doctrine of lis pendens. The High Court framed an issue as to whether Balubai (the vendor of Hajarimal) was the owner of the property on 14-4-1886, when Hajarimal purchased it, and remanded the suit. While doing so on the principle of lis pendens the Court observed 12 AOGJR-542.10 as under: "See Turner L.J.'s judgment in Bellamy v. Sabine [(1857) 1 De G.&J. 585]. "No case, so far as I am aware, has yet occurred in which the doctrine has been applied so as to affect the title of the alienee of a defendant by virtue of a claim not interfering with the title of the plaintiff in the pending litigation." It will of course be remembered that the doctrine of lis pendens is not based on the equitable doctrine of notice but on the ground that it is necessary to the administration of justice that the decision of the Court in a suit should be binding not only on the litigant parties but on those who derived title from them pendente lite whether with notice of the suit or not - see Bellamy v. Sabine [(1857) 1 De. G.&J. 566]. This being so no question of priority can arise to defeat the plaintiff's claim herein "pending litigation." The authorities are clear that the conveyance to the plaintiff herein pendente lite cannot be said to be void ab initio. If that had been intended s.52 must have been differently worded, whereas the section expressly says that the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein. The effect of the 13 AOGJR-542.10 doctrine is not to annul the conveyance but only to render it subservient to the rights of the parties to the litigation. Thus, the Master of the Rolls said in The Bishop of Winchester v. Paine [(1805) 11 Ves. 197] "Ordinarily, it is true, the decree of the Court binds only the parties to the suit. But he, who purchases during the pendency of the suit, is bound by the decree, that may be made against the person, from whom he derives title. The litigating parties are exempted from the necessity of taking any notice of a title, so acquired. As to them it is as if no such title existed. Otherwise suits would be indeterminable: or which would be the same in effect, it would be in the pleasure of one party, at what period the suit should be determined." And the Vice-Chancellor in Metcalfe v. Pulvertoft, [(1813) 2 Ves.&B. 204] says:- "The effect of the maxim pendente lite nihil innovetur," understood as making the conveyance wholly inoperative, not only in the suit depending but absolutely to all purposes in all future suits and all future time, is founded in error." In Landon v. Morris [(1832) 5 Sim. 263] it is said: "The principle of the decision in The Bishop of Winchester v. Paine is admitted, that a purchaser pendente lite, is bound by the decree made against the person from whom he purchases." And it must be remembered that Cranworth L.C. in Bellamy v. Sabine [(1857) 1 De.G.&J. 580} says "pendente lite neither party 14 AOGJR-542.10 to the litigation can alienate the property in suit so as to affect his opponent." (emphasis supplied) 8. In Pramatha Nath Roy v. Jagannath Kishore Lal Singh Deo, reported in 16 Indian Cases 359, decided on 7-5-1912 (relied on by a Division Bench of Calcutta High Court in AIR 1988 Calcutta 25 discussed later), the question was squarely one of refusal of temporary injunction by a trial Court during the pendency of suit for specific performance of agreement to lease. Section 52 of the TP Act was not noticed. The observations of the Court in para 2 show that it followed English judgments holding that doctrine of lis pendens was quite a new doctrine and the Court eventually directed that an injunction may be granted or plaintiff may furnish security in the sum of Rs.1000/- and an undertaking by the plaintiff to compensate the defendant in the event of dismissal of suit. 9. The learned counsel supporting grant of injunction therefore claimed that in spite of `lis pendens', an injunction could and ought to be issued on the basis of this judgment. After having considered the judgment in the 15 AOGJR-542.10 light of these arguments, it cannot be held that the judgment is an authority for such a proposition; first because it takes no note of Section 52 of the TP Act and proceeds on an English judgment (based on common law which evolved from precedent to precedent) observing that the doctrine was `new', though the Court also noticed judgment of Court of Appeal to the contrary. Thus the judgment is based on reluctance to apply the doctrine of lis pendens, and without noticing that it was a part of Indian Statute Law and therefore cannot prevail in the face of the judgment of the Division Bench of this Court in Nathaji Anandrav Patil s case (supra). 10. In Nagubai Ammal and others v. B. Shama Rao and others, reported in AIR 1956 SC 593, the question was not of granting temporary injunction, but as to when the lis commences for the purpose of Section 52 of the TP Act and also of the distinction between collusive and fraudulent proceedings for the purpose of Section 52. In this regard the Court held that a collusive proceeding is where two persons agree that one should institute a suit against the other in order to obtain a decision from Court for some sinister purpose; while in a 16 AOGJR-542.10 fraudulent proceeding the claim is untrue and by practising fraud upon the Court it is intended to injure the opponent. The Court also considered the position of a transferee pendente lite and held that as between the transferor and transferee the sale is valid but is of no effect against the decree holder. Thus the judgment does not have a direct bearing on the issue involved. 11. In Jayaram Mudaliar v. Ayyaswami and others, reported in (1972) 2 SCC 200, on 23-6-1956 Ayyaswami filed a suit against Muniswami Mudaliar and others for partition of family properties. On 7-7-1958, Muniswami and his four sons executed sale deed in respect of some properties which were subject-matter of the suit. On 15-7-1960, Jayaram purchased some other properties in the suit at public auction held for recovery of arrears for a pump-set purchased by Muniswami. Jayaram got himself impleaded as defendant. The plaintiff amended the plaint and alleged that both the sales were hit by rule of lis pendens and that the public auction was collusive and fraudulent. The trial Court held that both the sales were hit by rule of lis pendens. The District Court confirmed the decree. The High Court held that auction 17 AOGJR-542.10 sale would not be hit by the rule of lis pendens to the extent loans were taken for the improvement of suit properties and asked the trial Court to decide this aspect in final decree proceedings. In a separate but concurring judgment, S.M. Sikri, C.J., held that the principle of lis pendens does not affect a valid charge or mortgage on the property already existing when a suit is filed. M.H. Beg and A.N. Ray, JJ., after considering the provisions of Section 52 of the TP Act held in para 47 of the judgment as under: "47. It is evident that the doctrine, as stated in Section 52, applies not merely to actual transfers or rights which are subject-matter of litigation but to other dealings with it "by any party to the suit or proceeding, so as to affect the right of any other party thereto". Hence, it could be urged that where it is not a party to the litigation but an outside agency, such as the tax collecting authorities of the Government, which proceeds against the subject-matter of litigation, without anything done by a litigating party, the resulting transaction will not be hit by Section 52. Again, where all the parties which could be affected by a pending litigation are themselves parties to a transfer or dealings with property in such a way that they cannot resile from or disown the transaction impugned before the Court dealing with 18 AOGJR-542.10 the litigation, the Court may bind them to their own acts. All these are matters which the Court could have properly considered. The purpose of Section 52 of the Transfer of Property Act is not to defeat any just and equitable claim but only to subject them to the authority of the Court which is dealing with the property to which claims are put forward." 12. In Rajendra Singh and others v. Santa Singh and others, reported in (1973) 2 SCC 705, again the question was not one of grant of temporary injunction, but whether the rule of lis pendens arrests the running of period of limitation during the pendency of suits. While dealing with this question, the Court observed as under in para 15 of the judgment: "15. The doctrine of lis pendens was intended to strike at attempts by parties to a litigation to circumvent the jurisdiction of a court, in which a dispute on rights or interests in immovable property is pending, by private dealings which may remove the subject-matter of litigation from the ambit of the Court's power to decide a pending dispute or frustrate its decree. Alienees acquiring any immovable property during a litigation over it are held to be bound, by an application of the doctrine, by the decree passed in the suit even though they may not have been impleaded in it. The whole 19 AOGJR-542.10 object of the doctrine of lis pendens is to subject parties to the litigation as well as others, who seek to acquire rights in immovable property, which are the subject- matter of a litigation, to the power and jurisdiction of the Court so as to prevent the object of a pending action from being defeated." 13. The only judgment which directly deals with question of grant of temporary injunctions in cases where plaintiff could have protection of Section 52 of the TP Act is one of a Division Bench of the Calcutta High Court in Smt. Muktakesi Dawn and others v. Haripada Mazumdar and another, reported in AIR 1988 Calcutta 25. Paragraphs 4 and 5 of the judgment which deal with the question may be usefully reproduced as under: "4. Mr. Roy Chowdhury has secondly urged 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 S. 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 S.52 of the T.P. Act takes care of all pendente lite transfers; but it may not always be 20 AOGJR-542.10 good enough to take fullest care of the plaintiff's interest vis-a-vis such a transfer. The suit giving rise to the impugned order is one for specific performance of sale in respect of the suit property 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 R.1 of O.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 S.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 R.1 for interim injunction restraining the transfer of suit property. R.1 of O.39, in our view, clearly demonstrates that, notwithstanding the Rule of lis pendens in S.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. 5. Mr. Mukherjee, appearing for 21 AOGJR-542.10 the respondents has drawn our attention to an old Division Bench decision of this Court in Promotha Nath v. Jagannath, (1913) 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, (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