1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION NOTICE OF MOTION NO.1190 OF 2009 IN SUIT NO.754 OF 2009 Rohit P. Shah and Anr. .. Plaintiffs Versus Devesh Narendra Jani & Ors. .. Defendants Mr.S.V.Doijode with Ms.Taruna Nagpal and Ms.Deeksha Kakar i/b. Doijode and Associates for plaintiffs. Mr.D.H.Mehta witth Usha Gadagkar i/b. Divya Shah Associates for defendant No.1. CORAM : S.C.DHARMADHIKARI, J. DATE : 27th August 2009. P.C.: 1] Plaintiff has filed this suit for a declaration that the Agreement and Allotment Letters (Exh.A to C) dated 19th July 2007 are valid, subsisting and binding upon the defendants and the purported termination thereof does not in any manner bind the plaintiff. 2] There are further declarations sought and prayer clauses (c) and (d) 2 of the plaint read thus:- “(c) That it be declared that the alleged Agreement dated 19th December 2007 (Exh.J) between the defendant Nos. 1 and 4 is sham, bogus and defendant No.4 has no right based on the same and/or the same is not binding upon the plaintiffs and is subject to the plaintiffs’ right under suit agreement and allotment letters all dated 9th July 2007 (Exh.A to C).” “(d) The defendant No.1 be ordered and decreed to specifically perform the Agreement and the allotment letters dated 9th July 2007 (Exh.A to C) and defendant Nos.2 to 4 jointly and severally be ordered and decreed to join Defendant no.1 in conveying and transferring the entire 5th floor premises of the said building in favour of the plaintiff.” 3] The motion has been moved for interim reliefs and more particularly that pending the hearing and final disposal of this suit, the first defendant shall not allow the defendant No.4 to occupy Flat No.502 3 and defendant No.4 be restrained by an order and injunction from taking over possession of the flat No.502 and/or occupying the same. The prayers that are reproduced above are only to emphasise the fact that on initial occasions when this matter was placed before the Court and even when the arguments concluded, defendant No.4 was present. His Advocate made a statement on instructions that defendant No.4 does not wish to contest the motion as also the suit. He will have no objection if any orders are made in this notice of motion and the suit in favour of the plaintiff. Being fully aware of the consequences of his statement that on the earlier occasion while concluding the arguments, I had passed an order recording the above. 4] The affidavit in support of the notice of motion sets out as to how the suit has been filed claiming the aforementioned declarations. The basis upon which the reliefs are claimed are that the plaintiffs are husband and wife. The first defendant is carrying on business as builder and developer. Second and third defendants were/ are the owners of a building more particularly mentioned in para 1 of the plaint. The fourth defendant is made party because he claims to have entered into an 4 agreement with the first defendant in respect of flat No.502. 5] It is common ground that the old building is now demolished and a new building is put up / has been put up by the owners. The prayer for specific performance is in relation to Flat No.501, 502 and 503 comprising the entire fifth floor. It is further common ground that plaintiff No.1 was a monthly tenant in respect of the premises admeasuring about 500 sft. Carpet on third floor of the old building. 6] Defendant Nos. 2 and 3 granted re-development rights in favour of defendant No.1 in respect of old building and conferred upon him further rights to negotiate and settle with the tenants and/or provide permanent alternate accommodation to them. The balance F.S.I. was to be exploited by the developer and he could dispose it off in the form of flats constructed in the new building. In para 6 of the plaint, it has been set out as to how the first defendant approached the plaintiff and represented that he had acquired aforesaid right. He was interested in developing the properly and selling the flats in the proposed building. He was obliged to provide permanent alternate accommodation to the plaintiffs of the same 5 area as was occupied by them in the old building. Initially, flat No.701 was offered but later on plaintiff was of the opinion that he should acquire the entire floor in the new building. Plaintiffs were informed that on each floor, there would be three flats and if the plaintiffs desire the first defendant would give entire fifth floor to them. After certain negotiations, consideration to be paid for other two flats was agreed. The first defendant, however, suggested to plaintiffs that since he was selling additional area to the plaintiffs, he would have to prepare some letters to show that certain reminders were sent and, thereafter, an agreement was executed. Thereafter, this correspondence preceding the impugned termination followed. In such circumstances, the agreement dated 9th July 2007 for providing permanent alternate accommodation along with one open car parking space was executed. This flat (502) admeasures 500 sft. and there is no dispute that this is the entitlement of the plaintiffs even otherwise. 7] However, two letters of allotment of flat Nos. 501 and 503 for the consideration mentioned in para 6(b) of the plaint have been executed in favour of plaintiffs. 6 8] It would be advantageous to refer to these letters of allotment, copies of which are annexed to the plaint as Annexure B page 77. The relevant portion of the same reads thus:- “I am pleased to allot to you a tentatively Flat No.501 on the 5th floor of the proposed building known as “SHYAM VIHAR” situated at Plot No.388, Shankar Mattham Road, Matunga, Mumbai 400 019 (hereinafter referred to as the “the said Proposed Building”), as per the proposed plan admeasuring approximate Carpet Area 351 sq.ft including enclosed balcony and planters/flower bed/service area/ornamental projection alongwith __ car parking space as per allotment done at my discretion in the said Proposed Building, for a total lump sum consideration of Rs.49,46,750/- which shall be paid by you as follows: Earnest Money Deposit - Rs.5,00,000.00/- 45% on receipt of IOD and on starting demolition of old building structure. 7 Balance in 15 equal installment of Rs. _____/- starting from ____” 9] Similar is the letter with regard to flat No.503. 10] It is stated that the first agreement (Annexure A) is duly registered which is in respect of accommodation (flat No.502) in lieu of the old tenanted flat. It is stated that necessary documents were executed in favour of the first defendant and subsequently the plaintiffs vacated flat No.11 on the third floor in the old building. According to plaintiffs, he has made payment of an aggregate sum of Rs.25 lakhs including earnest money of Rs.5 lakhs and further amounts in consideration of flat No.501. As far as flat No.503 is concerned, as against total consideration, plaintiff has paid Rs.6 lakhs as earnest money. 11] Plaintiffs state that they were ready with the funds and were awaiting the first defendant’s call for execution of agreement and payment of balance price in terms of the Letters of Allotment. However, when they discovered that the old building was demolished and 8 construction of the new building has commenced, they requested by a letter dated 30th April 2008 addressed to the first defendant for allotment of flats and enquired as to how much amount is to be paid. They further requested to furnish approved municipal plans of 5th floor. 12] It is alleged that in response to these letters, they were expecting clarifications from the first defendant but he alleged on 6th May 2008 that the plaintiffs have committed breaches of the basic terms of the letters of allotment. The first defendant pointed out that as per the modified plan Flat No.501 has now become flat No.301 which means that the plaintiffs would get a flat on the third floor. Thus, the plaintiffs found that all that they would be offered and were held to be allegedly entitled to is one flat in lieu of their earlier accommodation. The natural consequence of this means that the allotment letters in respect of other two flats are withdrawn. It is in such circumstances, that they further discovered that there is a modification of the plans for the fifth floor. They also obtained a copy of the agreement between the defendant Nos. 1 and 4. Thereafter, the Advocate’s correspondence followed and the instant suit has been filed. 9 13] Mr.Doijode appearing for plaintiffs invited my attention to the plaint averments and annexures and submitted that there is no question of any breach being committed by the plaintiffs, as admittedly, the agreements and letters of allotment have not been denied. The receipt of a sum of Rs.31 lakhs has also not been denied. If the entitlement of the plaintiffs is not denied, then, on what basis there is alteration of the situation from July 2007 till April/ May 2008, is not clear at all. All these allegations of breaches are an after thought and the first defendant has wriggled out of his obligations under the agreement in question. Prima facie a case is made out where the plaintiffs entitlement for the three flats cannot be held to be illegal. More so, when the plaintiffs are ready and willing to abide by the terms and conditions of the allotment letters and make payment of the balance consideration. 14] Mr.Doijode submits that the situation has undergone a change as the plaintiffs earlier argued for the interim relief so as to protect their entitlement. However, having found that defendant No.4 himself is not interested in any accommodation/ flat in terms of the purported 10 agreement between him and the defendants, then, the plaintiffs should be put in possession of the flats on the fifth floor. Plaintiffs would abide by all terms and conditions of the letter of allotment so also such other terms imposed by this Court. 15] He, therefore, prays for appropriate interim orders in favour of plaintiffs. 16] On the other hand, Mr.D.H.Mehta appearing for first defendant contended that there is a delay in approaching this Court. The plaintiffs were aware of the fact that the I.O.D., dated 11th April 2007 was issued, plans were sanctioned for construction of basement, stilt and eight upper floors. Each floor consists of two flats. Initially, on 17th April 2007 first defendant proposed to allot as and by way of permanent accommodation Flat NO.701 admeasuring about 453 sft., (carpet) on the 7th floor of the proposed new building. All these documents were duly furnished to the plaintiffs. Thereafter, the plaintiffs failed to enter into an agreement for permanent accommodation and to shift themselves from the old building. Therefore, once again a letter dated 10th May 2007 was addressed. 11 Defendant No.1 also entered into the agreement with the other defendants and shifted them to the transit accommodation. Despite reasons best known to the plaintiffs and even after receipt of reminders, the plaintiffs failed to enter into an agreement and that is how the letter dated 25th June 2007 was addressed. Thus, the first defendant had to take recourse to section 95A of the MHADA Act on account of non cooperation and the obstructive attitude of the plaintiffs. It is in such circumstances the agreement for permanent alternate accommodation was entered on 9th July 2007. Thus, the only entitlement is under this agreement and it is nobody’s case that Flat No.502 on the fifth floor was not offered. Mr.Mehta invites my attention to clause 12 of the permanent alternate accommodation agreement and contended that everything is tentative. Modifications were agreed and all that was contemplated through out is no deprivation of permanent alternate accommodation. As far as the location is concerned, there is no right conferred in favour of the plaintiffs. The plaintiffs cannot insist upon a particular flat on third floor being provided to them, after they are signatories to this agreement and the terms and conditions being made known to them so also the relevant documents furnished. 12 17] Mr.Mehta, therefore, contends that shifting of flat from 5th floor to 3rd floor does not mean that the plaintiffs can urge that there is a breach on the part of the first defendant. With reference to the purported letters of allotment, he urges that the same are also tentative. The terms of these letters of allotment by themselves are not enforceable in law. He invites my attention to certain blanks in the letters of allotment and submits that on crucial and relevant aspects there is no agreement reached between the parties. The letter itself is not a concluded contract which can be said to be enforceable in law. No relief of specific performance could be claimed on that basis. 18] With regard to the other allotment letter also it is urged that the plaintiffs were required to deposit a sum of Rs.6 lakhs but they have failed and neglected to pay 45% of the total consideration as per the agreement and instalments stipulated. Thus, the right under this agreement stands forfeited. In these circumstances, the first defendant was right in forfeiting the amounts which have been paid. It is contended that the I.O.D., was already forwarded and it is false to urge that the copy 13 of the I.O.D., dated 11th April 2007 was not made available. 19] Such being the circumstances, no case of interim relief is made out and, therefore, the motion be dismissed. 20] When the matter was placed before this Court for ad-interim reliefs on 24th November 2008, this Court after hearing both sides had recorded a statement that the construction of second floor of the building was in progress. It was recorded that as per the modified sanctioned plan, 5th floor will have only two flats viz., 501 and 502 and these two flats have been amalgamated and allotted to fourth defendant. This Court after taking into account all these aspects directed that the first and fourth defendants shall not create any third party rights, interest in respect of premises on the fifth floor of the building under construction. This order dated 24th November 2008 followed the prior order dated 24th October 2008. The motion was thereafter placed before me for hearing and final disposal. I have heard both the learned Counsel. I have also perused the affidavits filed on record. 14 21] There is substance in the contention of Mr.Doijode that after the fourth defendant appeared before this Court and has clarified his position, the circumstances have indeed changed. The fourth defendant is not interested in acquiring the flats which were offered to him on the fifth floor. He has unconditionally made the aforerecorded statements, firstly through his Advocates and, thereafter, reiterated them, appearing in person. There is, therefore, no subsisting claim of the fourth defendant atleast prima facie. Once the fourth defendant is aware of the fact that he may lose his entitlement but despite such awareness and knowing the consequences flowing from the statements made, he confirmed and reiterated them. Thus, the flat viz., Flat No.502 which was meant for defendant No.4 has not been allotted to him nor is it in possession of any third party. The said flat is stated to be vacant. 22] When the Court expressed the opinion that if this flat is vacant, then, why does not the first defendant offer the flats on the fifth floor in their entirety to the plaintiffs so that the plaintiffs take them in lieu of their entitlement to the third floor of the new building, at that stage, for the first time, it was disclosed that flat No.501 which is situate on 5th floor 15 is already allotted to a third party under an agreement dated 31st July 2008 and thus the entire fifth floor is not vacant or unallotted. On a further query from the court as to why this agreement dated 31st July 2008 has not been disclosed in any of the affidavits nor during the course of arguments, it was stated that the agreement is a registered agreement and there was no occasion to deprive the third party of any claim. The person concerned (third party) was a tenant of old building. 23] Thus, the position is that the third floor of the new building so also flat No.502 are vacant. Mr.Doijode submits that this Court should not proceed on the basis that the agreement dated 31st July 2008 (till date not disclosed) finally determines the rights of plaintiffs or the third party. He would take such steps including impleading the third party by amending the plaint and according to him, it is not correct to urge that flat No.501 is not available for allotment to the plaintiffs. He, therefore, seeks liberty to raise appropriate pleas with regard to this agreement and the flat after the plaint is amended. 24] After this, once again when a query was made as to whether the 16 plaintiff can be put in vacant and peaceful possession of a flat on the third floor so also flat No.502, meant for fourth defendant, it is stated that the letter of allotment in favour of plaintiffs has been duly terminated. The plaintiffs have not paid any amount save and except Rs.6 lakhs in respect of this flat. Therefore, the first defendant is not obliged to put the plaintiffs in vacant possession of this flat at the interlocutory stage. The correctness of the rival contentions is yet to be adjudicated upon and, according to first defendant, no interim orders be made. 25] When I informed Mr.Mehta that I was inclined to continue the ad- interim order in respect of flat No.502 and when the fourth defendant is not interested in any allotment, then, net result would be that the said flat would be vacant and of nobody’s use till the suit is heard and disposed of. Mr.Mehta sought time to take instructions and make a appropriate statement. The matter was thus, kept back at his request till 3.00 p.m. 26] Considering that the 4th defendant has given up his claim Mr.Mehta submits on instructions that Flat No.502 can be offered to the plaintiff but he is not entitled to anything beyond his entitlement of a 17 permanent accommodation in lieu of his tenancy in the old building. As far as Flat No.501 is concerned, Mr.Mehta submits that the agreement with third party is of 31st July 2008 and the suit is instituted much thereafter. Therefore, it is not as if the agreement is executed on the eve of institution of the suit or much less during its pendency. 27] In my view, considering the aforementioned facts and circumstances, interest of justice would be sub-serve if at this prima facie stage, plaintiff is put in possession of Flat No.502, which is on the fifth floor of the new building, with all amenities as are stipulated in the agreement for permanent accommodation together with parking spaces that are reserved for this flat. This arrangement is made in the light of the statement made by 4th defendant and that his claim has been given up by him voluntarily. Such being the case, I see no substance in the apprehension of the first defendant that the 4th defendant may raise any claim in future and that is why this arrangement cannot be made at an interlocutory stage. The 4th defendant has appeared at an interlocutory stage and has made statements which are recorded above. Therefore, the apprehension, if any, is without any basis. Needless therefore, to state 18 that if the plaintiff is put in possession of flat No.502, he shall have to forgo his claim with regard to the Flat No.302 on the third floor but all this would be without prejudice to his rights and contentions in the suit. 28] In these peculiar facts and circumstances, I accede to the submissions of Mr.Doijode and as far as Flat No.501 is concerned, I make no interim orders but leave the controversy open. After the plaintiff takes necessary steps to amend the plaint, the plaintiff would be at liberty to renew the request of interim reliefs on the basis of his entitlement to Flat No.501. All contentions of both sides in that behalf are kept open. 29] The motion is made absolute by directing first defendant to put plaintiff in possession of Flat No.502 within a period of four weeks from the date the occupation certificate (O.C) is granted in respect of the said building. 30] Needless to state that plaintiff would be informed about the grant of O.C., within a period of one week from its receipt by the first defendant and the plaintiff should pay the balance sum quantified under the 19 agreement, if any, and only thereupon, he should be put in vacant and peaceful possession of Flat No.502. However, this flat is in lieu of Flat No.301. It may not be necessary for the plaintiffs to pay any further sums. This is the permanent alternate accommodation in lieu of old tenancy and not an additional flat. This order is made on the basis that Flat No.502 is vacant and not allotted to any third party. 31] Ad-interim order to continue until the plaintiff is put in possession in terms of this order. Hence, notice of motion is made absolute by directing that in lieu of flat No.301, plaintiffs should be put in possession of flat No.502 (5th floor) of the new building within the period specified above. All pleas as regards flat No.501 are kept open. There will be no order as to costs. (S.C.DHARMADHIKARI, J)