In the High Court of Punjab and Haryana at Chandigarh Civil Revision No. 1084 of 2008 Date of decision: September 15, 2009 Gulzar Singh .. Petitioner Vs. M/s Vikas House Building Company and others .. Respondents Civil Revision No. 1691 of 2008 Paramjit Singh and another .. Petitioners Vs. M/s Vikas Housing Building Company and another .. Respondents Coram: Hon'ble Mr. Justice A.N. Jindal Present: Mr. G.S. Punia and Mr. C.S. Bakshi, Advocates for the petitioner. Mr. M.S. Sachdeva, Advocate for the respondent No.1. A.N. Jindal, J This judgment of mine shall dispose of two revision petitions one bearing No.1084 of 2008 filed by Gulzar Singh and second bearing No.1691 of 2008 filed by Paramjit Singh and another, against M/s Vikas House Building Company and other. The trial court vide its order dated 1.12.2007, had declined the application for temporary injunction. However, the plaintiff-respondent No.1 (herein referred as 'the plaintiff No.1') filed the appeal whereby the learned District Judge, Ludhiana vide order dated 14.2.2008, accepted the appeal and restrained the defendants- petitioners (herein referred as 'the petitioners') from alienating, dispossessing, mortgaging or in any manner creating charge over the suit land measuring 7 bighas 19 biswas 12 biswasi comprised in Khasra Nos. 33/2, 34, 37/1, Khewat No.1248, Khatauni No.1595 situated in village Baraewal Awana, Tehsil and District, Ludhiana. The factual background of the case is that the plaintiffs filed a Civil Revision No. 1084 of 2008 & Civil Revision No. 1691 of 2008 -2- suit for possession by way of specific performance of the agreement dated 15.2.1997 executed by the defendant No.1 in favour of the plaintiff company in respect of the land measuring 7 bighas 19 biswas and 12 biswasi as referred to above. As defendant No.1 had already executed a sale deed dated 6.11.2003 in respect of the land measuring 3 bighas 0 biswas 0 biswasi, therefore, the plaintiff company had also claimed mandatory injunction directing the defendant No.1 to execute and get the sale deed registered qua the land measuring 4 bighas 19 biswas 12 biswasi in favour of the plaintiff and also directing the defendants No.2 to 5 (subsequent vendees) from interfering in possession of the plaintiff or dispossessing the plaintiff illegally and forcibly or further alienating the suit property. It was averred that vide agreement dated 15.2.1997, the plaintiff company agreed to purchase aforesaid land @ Rs.23 lacs per acre from the defendant No.1. An earnest money of Rs.1 lac was given by the plaintiff to the defendant. The balance was to be paid later on. The possession of the land was handed over to the plaintiff company at the time of agreement. The defendant No.1 had also executed a special power of attorney in favour of the plaintiff company on 17.3.1997. After getting licence from the PUDA, the plaintiff company carved out the plots and agreed to sell the said property to the various customers. The plaintiff company made payment of Rs.1,73,28,250/- to the defendant during the period from 15.2.1997 to 6.11.2003. On 6.11.2003, the defendant No.1 at the instance of the plaintiff executed a sale deed in favour of Rakesh Mehta son of Baldev Raj Mehta resident of Phillaur, District Jalandhar and he remained owner of 4 bighas 19 biswas and 12 biswasi. Since the land had not been transferred by a formal deed, therefore, the title remained with the defendant No.1 and he had not executed the sale deed in favour of the plaintiff company. The defendant wanted that against the consideration to be paid by the plaintiff company he should be given plot of 7200 sq. yards, as such, the plaintiff transferred the aforesaid plot on 6.11.2003 to the defendant No.1 and this amount of Rs.72 lacs in lieu of the plot was to be adjusted by the defendant No.1 against the agreement. A sum of Rs.32 lacs was paid by Rakesh Mehta to defendant No.1 against the sale deed dated 6.11.2003, which was independent of the amount of Rs.32 lacs paid by the plaintiff company on Civil Revision No. 1084 of 2008 & Civil Revision No. 1691 of 2008 -3- the same day. The matter prolonged a bit and the defendant No.1 had already received the entire consideration but did not execute the sale deed. However, it was mutually settled that consideration was fixed at Rs.1,75,00,000/- instead of Rs.1,15,00,000/- and out of that amount the defendant had already received a sum of Rs.1,73,28,250/- regarding which the agreement was executed on 6.11.2003, whereby confirming the payment and declaring the balance of Rs.1,71,750/- against the plaintiff. It was also agreed that the plaintiff company could get the sale deed executed in its favour at any time after sending a notice for that purpose. Despite the telegraphic notice issued to the defendant to appear before the Sub Registrar on 20.4.2006 for getting the sale deed executed, the defendant did not put in appearance. The plaintiff company also came to know that during the pendency of the suit, the defendant No.1 sold some property out of the suit land vide sale deed No.12772 dated 1.9.2006 in favour of defendant No.2, sale deed No.12774 dated 1.9.2006 in favour of defendant No.3, sale deed No.12776 dated 1.9.2006 in favour of defendant No.4, sale deed No.14939 dated 5.10.2006 in favour of defendants No.3 and 5. Thus, they being the subsequent vendees, during the pendency of the suit had no statutory right, as such, sale suffers from the principles of lis-pendens. Along with the suit, an application for temporary injunction has also been filed. Defendant No.1-appellant in his written statement on merits, admitted having executed the agreement dated 15.2.1997. However, he has taken a stand that the rate settled between the parties was not Rs.23 lacs per acre but it was Rs.1 crore per acre. However, Rs.23 lacs per acre was mentioned on the asking of the plaintiff company as it wanted to pay the remaining amount underhand (unaccountable money) He denied if actual, physical and cultivating possession of the land was given to the company. He also denied the power of attorney dated 17.3.1997 allegedly given to it stating that it was a result of fraud and misrepresentation. He also denied if the plaintiff company had carved out the plots. However, it was admitted that the defendant wanted that against the consideration to be paid by the plaintiff company, he should be given a plot measuring 7200 sq. yards, but it was denied if the rate per sq. yard was settled at Rs.1000/-. In fact, it was settled at Rs.600/- per sq. yard. He also denied if the plaintiff company Civil Revision No. 1084 of 2008 & Civil Revision No. 1691 of 2008 -4- transferred the property measuring 7200 sq. yards vide sale deed dated 6.11.2003 to him and that the payment of Rs.72 lacs was confirmed to have been adjusted. Neither any such plot was transferred in his name nor any sale deed has been executed in his favour. He also denied if Rs.30 lacs were paid by Rakesh Mehta to him against the sale deed dated 6.11.2003 which was in addition to the amount of Rs.32 lacs allegedly paid by the plaintiff company on the same day. He also denied if the amount as per the case set up by the plaintiff company has been received by him and the amount of Rs.1,71,750/- remained balance. He also challenged the alleged agreement dated 6.11.2003 being the result of fraud and forgery. Defendants No.2 to 5 also took the identical pleas stating that they are bonafide purchasers of the value without notice. After hearing the arguments, the trial court declined to grant injunction, whereas, the appellate court reversed the order. Now two petitions have been filed, one by the petitioners (subsequent vendees) who claimed themselves to be the bonafide purchasers and the other by the defendant No.1. Arguments heard. Record perused. The agreement to sell dated 15.2.1997 admittedly executed by Gulzar Singh defendant No.1 in favour of the plaintiff contained the condition that the plaintiff was to make full payment by October, 1998. The plaintiff could get the sale deed registered regarding that much land, price of which he could pay during that period. If the plaintiff could not comply with the terms of the agreement, then the agreement would be treated as cancelled and if the defendant refused to perform the contract, then the sale deed could be got registered by way of specific performance of the agreement. It was again reiterated in the agreement that if the terms of the agreement are not performed then the agreement shall stand cancelled. All this goes to show that the plaintiff was to make payment by October, 1998 and get the sale deed registered by that time and failing to make payment, the agreement would stand cancelled. There is no denying a fact that the plaintiff failed to make payment in terms of the agreement and his stand that he continued making payment up to 6.11.2003, but it does not prove his readiness or willingness to perform the agreement and this plea Civil Revision No. 1084 of 2008 & Civil Revision No. 1691 of 2008 -5- would also not bind the defendant to obey the agreement dated 15.2.1997. There is also no denying a fact that the plaintiff has even not made the payment of the total sale price by 6.11.2003 as is revealed from the writing dated 6.11.2003. Since the plaintiff has not come on the basis of the agreement dated 6.11.2003, the specific performance of the agreement dated 15.7.1997 could not be made within the time fixed by the parties, therefore, it could be prima facie inferred that the period of limitation from the date fixed for registration of the agreement i.e. October, 1998, stood expired when the suit was filed. As regards the agreement dated 6.11.2003, it may be observed that this agreement is not in continuation with the earlier agreement as it refers the another agreement dated 15.7.1997 but the original agreement entered into between the parties is dated 15.2.1997. Even otherwise, this agreement has been challenged by the defendants having been got procured as a result of fraud and misrepresentation. The trial court has wrongly observed if the plaintiff has prima facie case in his favour for grant of injunction. The suit is apparently time barred as having been filed on 18.4.2006, with regard to the agreement dated 15.2.1997 which was to be performed by 31.6.1998. The plaintiff could be said to have a prima facie case if suit was not barred by limitation. In this belated suit, the plaintiffs cannot come to contend that they have prima facie case for grant of injunction, as such, no injunction could be granted when the suit is apparently time barred. Similar observations were made in case M/s Prabha Construction (P) Ltd. and others vs. Smt. Shan Trilochan Singh and another AIR 1995 Delhi 79 wherein it was observed as under :- “......... In para 7 of the notice dated 5.6.90, it has clearly been stated that since the plaintiffs did not perform their part of the agreement to sell, the said agreement became null and void and stood cancelled and the amount paid by way of earnest money stood forfeited. From this it is clear that the plaintiffs had the notice on 10.6.1990 that performance was refused by the defendants. The suit of the plaintiff for specific Civil Revision No. 1084 of 2008 & Civil Revision No. 1691 of 2008 -6- performance of the contract had to be filed within three years of the date when they had notice that performance was refused as no date was fixed for the performance in the agreement to sell. But since the plaintiffs have not filed the present suit within three years from 10th June, 1990, the suit of the plaintiffs appears to be barred by limitation. This fact itself is sufficient for vacating the ex-parte injunction granted in favour of the plaintiffs on 9.9.1993. Accordingly IA No.10179/93 is allowed and IA No.7750/93 is dismissed and the interim injunction granted on 9.9.1993 with regard to the suit property stands vacated. The parties are, however, left to bear their own costs.” It is settled law that agreement to sell itself does not create any interest in the property to seek a relief under order 39 Rules 1 & 2 CPC as has been observed in case Nagar Mal vs. Ram Saran 2002 (3) RCR (Civil) 47. Similarly, it was observed in case Subhash Chander Ahuja and others vs. Ashok Kumar Ahuja and others, 2005 (2) RCR (Civil) 159 that final order under Order 39 Rules 1 & 2 cannot be issued in favour of the plaintiff if the plaint is filed with an inordinate delay and same shall be a sufficient reason to reject this prayer. In the instant case, the delay is not only of a few days or months, but there is delay of 8 years in filing the suit. The trial court has not dealt with the three essentials for grant of injunction i.e. prima facie case, balance of convenience and irreparable loss. Since the plaintiff himself was negligent in getting the sale deed registered within time and even according to him, he did not make total payment within stipulated time but continued making payment in installments within 6 years, then certainly the balance of convenience could not tilt in his favour and he did not perform the contract as per terms of the agreement at his own risk and costs. The Lower Appellate Court has not taken into consideration this aspect of the case while deciding the scales of balance of convenience. As regards the irreparable loss, the defendant No.1 being the owner of the property could alienate the same at his own risk and cost and Civil Revision No. 1084 of 2008 & Civil Revision No. 1691 of 2008 -7- the sale deeds effected if any would suffer from the principles of lis pendens and also that the vendee would step into the shoes of the defendant No.1, therefore, the plaintiff cannot claim himself to be at irreparable loss particularly when the suit is badly time barred. The order passed by the Lower Appellate Court does not sound to the reason. It did not elaborately discuss as to how the plaintiff discussed the three essential ingredients of injunction. Similar observations have been made by the Apex Court in case Ajendraprasadji Narendraprasadji Pandey vs. Swamy K. Narayandasji and others, 2005 (3) RCR (Civil) 386 wherein it was observed as under :- “12. It is needless to note that while deciding the issue of injunction the Courts have to consider the cumulative facts i.e. prima facie case, balance of convenience and irreparable loss. Definite findings have to be given on these aspects, on a prima facie basis. The impugned judgment of the High Court which forms the subject matter of appeal relating to SLP © NO.15386/2004 does not meet the requirements. Therefore, without expressing any opinion on the merits and the acceptability of the various issues, we deem it appropriate to remit the matter to the High Court for fresh consideration.” In this case since all the three ingredients have been elaborately discussed, which do not find favour with the plaintiff, therefore, this court is within its power to examine whether the plaintiff has satisfied all the aforesaid three essentials, as such, the question of granting injunction does not arise. The Lower Appellate Court while accepting the application for grant of injunction did not record the finding that the findings returned by the trial court are perverse or against the settled principles of law without recording any such findings, the appellate court proceeded to contradict the conclusion recorded by the trial court. In my opinion this course adopted by the appellate court had the effect referring the order as patently illegal and occasioned failure of justice. The extent and scope of jurisdiction of the Lower Appellate Court to interfere with the order passed by the trial court in Civil Revision No. 1084 of 2008 & Civil Revision No. 1691 of 2008 -8- exercise of its discretion under Order 39 Rules 1 & 2 CPC has been discussed in case Smt. Vimla Devi vs. Jang Bahadur, AIR 1977 Rajesthan 196 wherein the legal position was summarised as under :- “The order refusing the temporary injunction is a discretionary character. Ordinarily the court of appeal will not interfere with the exercise of the discretion by the trial court and substitute for it its own discretion. The interference with the discretionary order, however, may be justified if the lower court acts arbitrarily, perversely, capriciously or in disregard of a sound legal principles or without considering all the relevant records. The mere possibility of the Appellate Court coming to a different conclusion on the same facts and evidence will also not justify interference.” Similar view was taken in case Guru Nanak Education Trust vs. Balbir Singh 1995 (2) PLR 625. Since the Lower Appellate Court has not properly appreciated the well established principles of law and having given a definite findings that the order passed by the trial court in any way is apparently perverse, capricious, arbitrary, unreasoned or in disregard to the sound legal principles, therefore, the same deserves to be set aside. It may further be observed that the Apex Court while delivering the judgment in case Wander Ltd. And another vs. Antox India Pvt. Ltd. 1990 (Supp) SCC 727 went to the extent that the appellate court would not interfere with the exercise of discretion of the court at the first instance and substitute its own discretion except where the discretion has been shown to have been exercised arbitrarily or capriciously or perversely or where the Court had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. But, the appellate court has not made any such conclusion while reversing the orders. As such, it was not proper, reasonable and justifiable for the appellate court to interfere with the discretion exercised by the trial court in declining the application for grant of injunction. Civil Revision No. 1084 of 2008 & Civil Revision No. 1691 of 2008 -9- As regards, the possession, the respondents have placed reliance on the recitals in the agreement to sell dated 15.2.1997, letter issued by the Engineer PUDA (R-7), licence for development of the property (R8), photographs of the property in dispute (R9/A to R9/E), FIR registered against the petitioners i.e. Gulzar Singh etc. (R-11), report of Tehsildar (R13) and report of the SDM (West), Ludhiana (R17). To the contrary, the petitioners have placed reliance on the copies of the khasra girdawries and jamabandies up to date wherein the petitioners-defendant No.1 is in possession of the suit property. As regards, the agreement to sell it may be observed that the same is hardly sufficient to prove the actual possession but only symbolical possession. Recitals in the agreement regarding the transfer of possession normally are taken as recorded symbolic possession. As regards the other evidence, the same could relate to the portion of the property which has been already transferred by the defendant No.1 in favour of the plaintiff. The evidence in the shape of letters or reports made by Tehsildar is hardly sufficient to determine the actual possession of the plaintiff. However, in order to further safeguard the rights of the parties, it would be better if the status quo with regard to possession is ordered to be maintained. While summarising, it may be observed that the impugned order passed by the Lower Appellate Authority does not sound well and is not well reasoned rather the same could be said to be perverse deserving interference by this Court. Resultantly, I accept both the revision petitions, set aside the impugned order dated 14.2.2008 and restore the order dated 1.12.2007 passed by the trial court. This order shall also dispose of all the civil miscellaneous applications. September 15, 2009 (A.N. Jindal) deepak Judge