AJN 1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION APPEAL NO.365 OF 2008 IN NOTICE OF MOTION NO.416 OF 2007 IN NOTICE OF MOTION NO.1697 OF 2007 IN SUIT NO.770 OF 2006 Ashok Kumar Mishrilal Jain. .... Appellant (Orig. Defendant) Vs. Padmini Hiralal Jain & Anr. .... Respondents (Orig. Plaintiffs) And Pepibai Mishrimal Jain & Ors. .... Respondents (Orig. Applicants) Mr. K.D. Jha for the appellant. Mr. Biren Saraf with Mr. S. Kanojiya and Ms. Neeta Solanki i/b Kiran Jain for the respondents (orig. applicants). Mr. A.S. Khandeparkar i/b D. Brijesh for the respondents (orig. plaintiffs). Mr. K.L. Vyas, Court Receiver, present in the court. AJN 2 ALONG WITH APPEAL (L) NO.527 OF 2008 IN NOTICE OF MOTION NO.1697 OF 2007 IN NOTICE OF MOTION NO.416 OF 2007 IN SUIT NO.770 OF 2006 Pepibai Mishrimal Jain & Ors. .... Appellants Vs. Padmini Hiralal Jain & Anr. .... Respondents Mr. Biren Saraf with Mr. S. Kanojiya and Ms. Neeta Solanki i/b Kiran Jain for the appellants. Mr. A.S. Khandeparkar i/b D. Brijesh for respondents 1 and 2. Mr. K.L. Vyas, Court Receiver, present in the court. CORAM : SMT. RANJANA DESAI & K.K. TATED, JJ. DATED : 1ST OCTOBER, 2008. P.C. 1. These two appeals can be disposed of by a common order AJN 3 because in both the appeals order dated 14/12/2007 passed by learned Single Judge disposing of Notice of Motion No.416 of 2007 and Notice of Motion No.1697 of 2007 in Notice of Motion No.416 of 2007 in Suit No.770 of 2006 is under challenge. 2. Notice of Motion No.416 of 2007 is taken out by the plaintiffs and Notice of Motion No.1697 of 2007 is taken out by the relatives of the original defendant. 3. The instant suit has been filed by the plaintiffs, inter alia, for a declaration that agreement dated 28/1/2005 between the plaintiffs and the defendant is valid and subsisting and the defendant is bound to specifically perform his part of the said agreement. The plaintiffs have also prayed for a declaration that the plaintiffs are the owners of the suit premises viz. Shop No.F/S/M-3-2/19, situated at ground floor, Parel Mahatma Co-operative Housing Society Limited, Jerbai Wadia Road, Bhoiwada, Parel, Mumbai – 400 012. AJN 4 4. The case of the plaintiffs is that by agreement for sale dated 28/1/2005, the defendant had agreed to transfer the suit premises to the plaintiffs for Rs.10 lakhs. It is the further case of the plaintiffs that on receipt of the said amount, the defendant put the plaintiffs in exclusive possession of the suit premises. However, the defendant requested the plaintiffs that he may be put in possession of the suit premises as he wanted to recover amounts from his customers. Accordingly, an agreement of leave and licence dated 1/2/2005 came to be executed between them. According to the plaintiffs, after expiry of the leave and licence agreement, the defendant failed and neglected to hand over the possession of the suit premises to the plaintiffs. Hence, the suit came to be filed for the reliefs mentioned hereinabove. 5. On 20/3/2007, the Court Receiver, High Court, Bombay came to be appointed in respect of the suit premises and the Court Receiver was directed to take symbolic possession of the suit premises. The Court Receiver was further directed to proceed with the determination of the terms and conditions on which the AJN 5 defendant would continue to occupy the premises as agent of the Court Receiver. This order came to be passed on Notice of Motion No.416 of 2007. 6. The appellants in Appeal (Lodging) No.527 of 2008, who have taken out Notice of Motion No.1697 of 2007 contend that they are the co-owners of the suit premises. According to them, the order appointing the Court Receiver is causing great prejudice to them. Their prayer in Notice of Motion No.1697 of 2007 is, inter alia, for setting aside the order passed by this court appointing the Court Receiver. By the impugned judgment and order, learned Single Judge directed that the appointment of the Court Receiver in respect of the suit premises made by order dated 20/3/2003 shall be continued during the continuance of the suit. Learned Single Judge appointed the defendant as agent of the Court Receiver and fixed the ad-hoc royalty at Rs.5,000/-. The defendant was directed to pay the royalty amount to the Court Receiver. Learned Single Judge made it clear that the plaintiffs shall be entitled to withdraw the same on furnishing security to the satisfaction of the Court AJN 6 Receiver in respect of the withdrawal of the royalty. The said order is under challenge before us. 7. The Parel Mahatma Co-operative Housing Society Limited in whose premises the suit premises are situated took out Notice of Motion No.906 of 2008 praying that the Court Receiver be directed to hand over possession of the suit premises to them for redevelopment of the suit premises. By order dated 10/6/2008, learned Single Judge disposed of the said motion. Learned Single Judge recorded the contentions made by learned counsel for the plaintiffs and the defendant that the rights of the parties in the suit premises will be kept intact to be decided in the suit and made the Notice of Motion absolute in terms of prayer clause (a). Thus, the defendant was directed to hand over possession of the suit premises to the Court Receiver within two weeks from the date of the said order. The Court Receiver, in turn, was directed to handover to the Society possession of the suit premises. Learned Single Judge permitted the Society to proceed to develop the suit premises and further directed that the constructed Shop No.28 AJN 7 shall be handed over by the Society to the Court Receiver within one week from the date of issuance of occupation certificate. The Court Receiver was directed, subject to the orders of this court and without prejudice to the rights and contentions of the plaintiffs, to hand over possession of the suit premises to the defendant as the agent of Court Receiver. 8. We have heard, Mr. Jha, learned counsel appearing for the appellants in Appeal No.365 of 2008. At the outset, Mr. Jha submitted that he has no objection to the appointment of the Court Receiver. His objection is to the payment of royalty. He submitted that the agreement for sale dated 28/1/2005, the leave and licence agreement dated 1/2/2005 are fabricated documents. He pointed out that the plaintiffs have adopted parallel proceedings in the Small Causes Court for eviction of the defendant and, hence, the instant suit is not tenable. Learned counsel further submitted that the plaintiffs claim an amount of Rs.10 lakhs. He submitted that the defendant is prepared to settle the claim by making payment of Rs.10 lakhs. He requested that, therefore, appropriate orders be AJN 8 passed. 9. Mr. Saraf, learned counsel appearing for the applicants in Notice of Motion No.1697 of 2007 submitted that the appointment of the Court Receiver is causing great prejudice to the applicants. He submitted that the suit premises stand in the name of the husband of applicant 1 and the father of other applicants. He submitted that applicant 4 is carrying on business in the suit premises. He submitted that therefore, the applicants cannot be dispossessed. He submitted that under Order XL, Rule 1, Sub-rule 2, such an application is perfectly maintainable in law. 10. So far as the defendant is concerned, in our opinion, since admittedly the defendant has not paid the ad-hoc royalty fixed by this court, he cannot even be heard. When the court asked for an explanation, learned counsel Mr. Jha, submitted that the royalty amount was not paid because the defendant wanted to challenge the impugned order. Default in payment of ad-hoc royalty amount as directed by the court cannot be justified on the ground that the AJN 9 defendant wanted to challenge the order. It was incumbent upon the defendant to first pay the royalty and then challenge the order. 11. Besides looking to the nature of the agreement for sale and the leave and licence agreement, around which the controversy revolves and considering the fact that the applicants in Notice of Motion No.1697 of 2007 are also staking their claim to the suit premises, in our opinion, the appointment of the Court Receiver cannot be faulted. It is true that the defendant has submitted a proposal for settlement of the suit. However, that proposal is not acceptable to the plaintiffs and, this court cannot force the plaintiffs to settle the matter. The defendant's case that the leave and licence agreement and the agreement for sale dated 28/1/2005 are fabricated can only be examined at the trial of the suit. For the present, in our opinion, appointment of the Court Receiver must be continued. Admittedly, the defendant is in arrears of royalty amount. Mr. Jha, learned counsel for the defendant, on instructions from his client, states that the arrears of royalty amount will be deposited. This statement is accepted. The defendant may AJN 10 do so. In view of this statement, at this stage, no order is necessary directing change in the agency. So far as Appeal (Lodging) No.527 is concerned, the appellants therein are not even parties to the suit and in the circumstances, they are not entitled to any relief. 12. In the circumstances, both the appeals are dismissed. [SMT. RANJANA DESAI, J.] [K.K. TATED, J.]