IN THE HIGH COURT OF GUJARAT AT AHMEDABAD APPEAL FROM ORDER No 311 of 2003 WITH CIVIL APPLICATION No 6489 of 2003 CIVIL APPLICATION No 1212 of 2004 For Approval and Signature: HON'BLE MR.JUSTICE K.A.PUJ ============================================================ 1. Whether Reporters of Local Papers may be allowed : YES to see the judgements? 2. To be referred to the Reporter or not? : YES 3. Whether Their Lordships wish to see the fair copy : NO of the judgement? 4. Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? 5. Whether it is to be circulated to the concerned : NO Magistrate/Magistrates,Judge/Judges,Tribunal/Tribunals? -------------------------------------------------------------- MANOJBHAI RAVJIBHAI RADADIYA & ANOTHER Versus KESHAVLAL DAYARAM DHANANI & OTHERS -------------------------------------------------------------- Appearance: 1. Appeal from Order No. 311 of 2003 & C.A. 6489 OF 2003. MRS KETTY A MEHTA for Petitioner No. 1-2 MR KK TRIVEDI for Petitioner No. 1-2 MR DHAVAL D VYAS for Respondent No. 1 2. Civil Application No. 1212 of 2004 MR CG SHARMA with Mr. D.D. Vyas for Applicant. MR KK TRIVEDI WITH MRS. KETTY A MEHTA for Respondent No.1. -------------------------------------------------------------- CORAM : HON'BLE MR.JUSTICE K.A.PUJ Date of decision: 15/06/2004 CAV JUDGEMENT This Appeal From Order is filed by the present appellants - original defendant Nos.4 & 5 against the order passed by the 3rd Joint Civil Judge (S.D.), Surat on 28.08.2003 below an application Exh.78 in Special Civil Suit No. 217 of 1999 whereby the learned Trial Judge has granted the interim relief in favour of the present respondent No.1 - original plaintiff as prayed for in para 8 (1) of the injunction application Exh. 78, till the final disposal of the suit. The learned Trial Judge has restrained the respondent Nos. 4 & 5 from transferring suit scheme/property to any other person and prevented them from disturbing the possession of the respondent No.1 as found from the order passed below Exh. 5. 2. The brief facts giving rise to the present Appeal From Order are that Special Civil Suit No. 217 of 1999 was filed by the present respondent No.1 for specific performance of agreement of sale dated 28.04.1984. The said suit was filed by the respondent No.1 only against late Shri Baldev A. Parmar, Rajendrasinh A. Parmar and late Vikramsinh B. Parmar, the original defendant Nos.1,2,3. The agreement of sale dated 28.04.1984 was in respect of Revenue Survey No. 124/1 paiki 23,775 Sq. Mtrs. and Revenue Survey No.125-A paiki 10,522 Sq. Mtrs. in all 34,297 Sq. Mtrs. and the amount of Rs.45,000/- in cash and cheque of Rs.10,000/- were paid in the year 1984, as against the total consideration of Rs.6,17,348/- which was agreed to be paid as the price of 34,297 Sq. Mtrs. land. The possession of the suit land was also alleged to have been given to the present respondent No.1. It is stated that on 14.07.1998, original owners entered into an irrevocable Power of Attorney in favour of the present appellant No.1-original defendant No. 4 giving him full authority to enter into transactions and to carry out any action for permission regarding Survey No. 124/1 of village Dabholi, Tal. Choryasi, Dist. Surat which was the land admeasuring 23,775 Sq. Mtrs. The possession of the said land was said to have been handed over on the same day i.e. 14.07.1998. The present suit was filed by the present respondent No.1 against the original owners of Survey No. 124/1 without joining all the owners of the land. On 28.07.1999, the present appellants gave an application for development permission and paid deposit for such permission as power of attorney holder of the original owners of Survey No. 124/1 of village Dabholi. Thereafter, on 10.09.1999, the Regd. Sale Deed was entered into between the present appellants and the original owners of Survey No. 124/1. After the execution of the Sale Deed in favour of the present appellants, the present appellants paid development charges to the Surat Urban Development Authority to the extent of Rs. 2,48,860/- on 24.03.2000. The present appellants have also paid water deposit of Rs. 49,945/- and Rs. 40,675/- as security deposit on 01.04.2000. Pursuant to the application made by the present appellants for development permission, the Surat Municipal Corporation approved the development plan on 05.05.2000 in respect of the land bearing Revenue Survey No. 124/1 of village Dabholi. 3. Since the present respondent No.1 has filed injunction application Exh.5 in Special Civil Suit No. 217 of 1999, the same was heard and injunction was granted on 28.08.2000 against the original owners of the land bearing Survey No. 124/1 of village Dabholi who were the original defendant Nos.1 to 3 in the said suit. Even on that day, the fact that the present appellants have already purchased the land by Regd. Sale Deed and have also obtained development plan duly approved by the Surat Municipal Corporation for construction of a building over the land, was not declared before the Court. It is the say of the present appellants that they were not aware about any order passed below application Exh.5 as the original owners never informed the present appellants about the same and the present appellants as owners started further development of the land. For the purpose of development of land, the present appellants have levelled the land and roads were laid out on Survey No. 124/1, trees were also planted and payments were made on 14.10.2000. An application for supply of water to the local authority was made in October, 2000 and an application for obtaining non-agriculture permission for construction of building was also moved to the appropriate authority. The appellants have also paid amount for removing encumbrance over the land and Certificate by Deputy Collector of Agriculture was given to the appellants to this effect. The appellants have further paid conversion tax amounting to Rs. 2,55,965/- on 19.12.2000 and also paid Rs. 15,358/- for special assessment as per the demand of the District Collector made on 27.11.2000. 4. It is the case of the appellants that they have received notice on 05.01.2001 from the District Collector stating therein that objections regarding their application for non-agriculture use of the land bearing Survey No. 124/1 were filed by the respondent No.1 and hearing was kept on 15.01.2001. On that date, the appellants remained present and they were informed by the District Collector that one Mr. Amratlal Dhanani has filed a suit and obtained some orders against the original owners. The appellants on inquiry for the first time found that some order was obtained against the original owners after the Regd. Sale Deed was entered in favour of the present appellants. The order obtained against the original defendant Nos.1 to 3 was not effective since 10.09.1999. The original owners have no title on the land and were not in possession of the suit land. On 17.01.2001, the Circle Officer sent a report to the District Collector pertaining to the application of the present appellants for non-agricultural permission, stating therein that the appellants are in possession of the suit land. On 22.02.2001, the appellants were asked to pay Rs.1,00,000/- towards the laying down of pipeline by the Surat Municipal Corporation and the said amount was paid by the appellants. On 27.04.2001, the appellants found the papers of Special Civil Suit No. 217 of 1999 from the file of Civil Judge (S.D.), Surat and it was apprehended by the appellants that the original owners who were joined as defendant Nos. 1 to 3 might be in collusion with the original plaintiff as the original defendants did not point out the fact regarding Regd. Sale Deed with the appellant and also the formalities performed by the present appellants. 5. The appellants, therefore, preferred Civil Application No. 563 of 2001 for leave to file appeal an Appeal From Order Stamp Number 258 of 2001 before this Court against the original plaintiff and original defendant Nos.1 to 3, challenging the order of interim relief passed by the learned Civil Judge (S.D.), Surat below an application Exh.5 in Special Civil Suit No. 217 of 1999. The appellants have disclosed all the facts and contended that no injunction could have been granted against the original defendant Nos.1 to 3 who had lost title with effect from 10.09.1999 and who never disclosed the fact regarding the said Sale Deed till the interim relief was granted on 29.08.2000. In the said Appeal From Order, it was pointed out by the respondent No.1 that they filed application Exh.64 to join the present appellants as party - defendants and that they would apply for necessary order of injunction against them. The Appeal From Order preferred by the present appellants was, therefore, withdrawn with a view to appear before the lower Court in Special Civil Suit No. 217 of 1999 and to submit their case before the lower court. 6. The application to join the present appellants was filed on 29.06.2002 and the present appellants filed their reply along with list Exh.74 producing several documents on record of the trial court. The present appellants have also produced Commissioner's report in R.C.S. No. 121 of 2002 filed by the present appellants against the present respondents in which the possession of the present appellants was clearly shown. The present appellants have also produced schedule with Exh. 105 which was a reply to the amended plaint showing 134 plot holders who were already allotted plots and who have already built their tenaments over the said plots. Despite the above facts, the learned Trial Judge has given a finding regarding possession of the lands in question with the present respondent No.1 and the impugned order below an application Exh.78 was passed by the learned Trial Judge granting interim injunction in terms of para 8 (1) of the said application till final disposal of the suit. 7. Being aggrieved by the said order, the present Appeal From Order is filed before this Court. 8. Mrs. Ketty A. Mehta with Mr. K.K. Trivedi, learned advocates appear for the appellants and Mr. Dhaval D. Vyas with Mr. D.D. Vyas, learned Senior advocate appear on caveat on behalf of the respondent No.1. After hearing the parties, the Court has passed an order on 15.09.2003 directing the parties to maintain status-quo as on that day qua the possession and title of the land in question. The Court has clarified on 10.10.2003 that the ad-interim relief granted to maintain status-quo was binding to both the parties and both the parties were directed to maintain status-quo qua possession and title of the property and should not make any attempt to execute the order under challenge in any manner whatsoever. The said interim relief was thereafter continued from time to time till the matter was heard and kept for order. 9. During the pendency of this Appeal, the present respondent No.1 - original plaintiff has moved Civil Application No. 1212 of 2004 for initiation of contempt proceedings against the opponents for having disobeyed the order of the Trial Court as well as of this Court. The respondent No.1 has also prayed for in the said application to adequately punish the opponents for any one or more of them who are found guilty of disobedience of the order of the learned Trial Judge as well as of this Court. A prayer was also made for appointment of the Court Commissioner with a direction to prepare a Panchnama showing the position of construction on the site under Police protection and to submit a detailed report to this Court in that behalf. By way of interim injunction, the respondent No.1 has prayed that the opponents be restrained from putting up any construction whatsoever or from completing the work on the site in question and also from transferring any of the units constructed or to be constructed on the suit land and from completing the transactions of transfer, if any and handing over possession of the units constructed on the said land to the persons to whom they are already transferred in the meanwhile or from creating any interest of the third party on the suit land or any part thereof during the pendency of the suit before the Trial Court. 10. This Court (Coram :- D.A. Mehta, J.) has issued rule in the said application on 23.02.2004. Mrs. Ketty.A. Mehta, learned advocate has waived service of rule on behalf of opponent Nos. 4 & 5. D.S. was prayed for qua opponent Nos. 1 to 3. The Opponent Nos.1 to 3 were not served till this date and the said application was ordered to be heard along with this appeal. 11. As far as A.O. No. 311 of 2003 is concerned, Mrs. Ketty A. Mehta, learned advocate appearing for the appellants has submitted that the Regd. Sale Deed was executed in favour of the present appellants much prior to the order of the Trial Court issuing injunction against the original owners on 29.08.2000 and, therefore, the said order could not have been relied upon for the purpose of binding the appellants by the said order. Inspite of the registration of Sale-deed, the present appellants were neither joined as defendants nor any interim relief was obtained against them till the order dated 28.08.2003 was passed by the Trial Court below an application Exh.78. She has further submitted that even on 28.08.2003 when the impugned order was passed by the learned Trial Judge, 134 plot holders were in possession of various plots of Survey No. 124/1 and these 134 plot holders have put up construction over the said plots. The present appellants were not aware at all about filing of the Special Civil Suit No. 217 of 1999, till in the proceedings before the Collector for permission for non-agriculture use, it was pointed out that the objections were filed and one Amratlal Dhanani, as Power of Attorney Holder of Keshav Dhanani had filed the suit. She has further submitted that though the objections were filed before the Collector by and on behalf of the present respondent No.1 in January, 2001, no steps were taken to join the present appellants in the said suit till the application Exh.64 was filed in June, 2002 and no injunction was obtained against the present appellants till 28.08.2003. The appellants had, in the meanwhile, completed all the formalities with the Surat Municipal Corporation and got their plans sanctioned, allotted plots to 134 persons whose names were disclosed in the present suit and construction was also carried out. As against the agreement of sale dated 28.04.1984 in favour of the present respondent No.1 which was not acted upon till 1999, the present appellants have become owners and the persons in possession of the suit land by virtue of the Regd. Sale Deed dated 10.09.1999 which has prima facie proved the title of the present appellants to the suit property. 12. She has further submitted that Special Civil Suit No. 217 of 1999 filed by the present respondent No.1 is hopelessly time barred as it was filed after the period of 15 years and no actions were taken during the said period. This fact itself shows that there was no intention on the part of the respondent No.1 to comply with the said agreement of sale. Even after the execution of Regd. Sale Deed on 10.09.1999, the present appellants were not joined as parties and no relief was claimed against them for more than three years and, therefore, the relief claimed against the present appellants was also barred by the doctrine of delay and laches. The learned Trial Judge should not have granted any interim relief in the suit which is barred by limitation. She has further submitted that the balance of convenience was not in favour of the respondent No.1 original plaintiff. On the contrary, it was in favour of the appellants as between the period from 10.09.1999 to 20.08.2003, the present appellants had obtained all permissions from the local authority and they had made several payments for conversion tax, special assessment charges for water connection, payment to local authority for laying down of pipelines and they have already handed over plots to various individuals who have built up their houses on the said land. As per the settled legal position in law, after a long time, no relief for specific performance of contract can be granted and the plaintiff will be entitled only to the compensation claimed by him. In the case where third parties' rights are created before any injunction is obtained, no relief of specific performance can be granted in favour of the plaintiff. 13. With regard to her contention that the suit filed by the plaintiff is hopelessly barred by limitation, she relied on the decision of the Hon'ble Supreme Court in the case of K.S. VIDYANADAM AND OTHERS V/S. VAIRAVAN, AIR 1997 S.C. 1751 wherein it is held that "The rigour of the rule evolved by courts that time is not of the essence of the contract in the case of immovable properties - evolved in times when prices and values were stable and inflation was unknown - requires to be relaxed, if not modified, particularly in the case of urban immovable properties. While exercising its discretion, the Court should also bear in mind that when the parties prescribe certain time limits for taking steps by one or the other party, it must have some significance and that the said time limits cannot be ignored altogether on the ground that time has not been made the essence of the contract (relating to immovable properties.) 14. She has further relied on the decision of the Hon'ble Supreme Court in the case of NIRMALA ANAND V/S. ADVENT CORPORATION PRIVATE LIMITED AND OTHERS, 2002 (8) S.C.C. 146 wherein it is held that ordinarily, the plaintiff should not be denied the relief of specific performance only on account of the phenomenal increase of price during the pendency of litigation. That may be, in a given case, one of the considerations besides many others be taken into account for refusing the decree of specific performance. As a general rule, it cannot be held that ordinarily the plaintiff cannot be allowed to have, for her alone, the entire benefit of phenomenal increase of the value of the property during the pendency of the litigation. While balancing the equities, one of the considerations to be kept in view is as to who is the defaulting party. It is also to be borne in mind whether a party is trying to take undue advantage over the other as also the hardship that may be caused to the defendant by directing specific performance. There may be other circumstances on which parties may not have any control. The totality of the circumstances is required to be seen. 15. She relied on the decision of this Court in the case of LALUBHAI HIRABHAI PATEL AND ANOTHER V/S. INDO-JAPAN INDUSTRIES AND OTHERS, 2001 (1) G.L.H. 77 wherein the Court has taken the view that in view of Article 54 of the Limitation Act, the suit for specific performance of contract after 11 years from the date of issuance of notice regarding refusal of performance by the defendant and where no date of performance fixed in the agreement, the suit is barred by limitation and in such a suit, the Trial Court should not have granted any interim injunction. 16. She has further relied on the decision of this Court in the case of VEETRAG HOLDINGS PVT. LTD. V/S. GUJARAT STATE TEXTILE CORPORATION LIMITED, 1996 (1) G.L.H. 179 wherein it is held that even if the plaintiff cannot be non-suited on the ground of limitation, inasmuch as their suit is within time. However, when it comes to grant of equitable relief when the suit is filed after such a lapse of time, it cannot be said that the remedy of interim injunction was the necessary remedy and there was no remedy available to the party concerned in this behalf. 17. She has further relied on the decision of the Hon'ble Supreme Court in the case of MANJUNATH ANANDAPPA URF SHIVAPPA V/S. TAMMANASA AND OTHERS, 2003 (10) S.C.C. 390 wherein the plaintiff filed the suit almost after six years from the date of entering into agreement of sale. He did not bring any material on record to show that he had ever asked the defendant, the owner of the property, to execute a deed of sale. He filed the suit only after he came to know that the suit land had already been sold by him in favour of the appellant. Further more, it was obligatory on the part of the plaintiff for obtaining a discretionary relief having regard to Section 20 of the Act to approach the Court within a reasonable time. The Court held that having regard to this conduct, the plaintiff was not entitled to the discretionary relief. 18. She has further relied on the decision of the Hon'ble Supreme Court in the case of VEERAYEE AMMAL V/S. SEENT AMMAL, AIR 2001 SUPREME COURT 2920 wherein after referring to the Constitution bench decision of the Hon'ble Supreme Court in the case of CHAND RANI (SMT.) (DEAD) V/S. KAMAL RANI (SMT.) (DEAD) BY LRS., 1993 (1) S.C.C. 519, the Hon'ble Supreme Court has held that in case of sale of immovable property there is no presumption as to time being the essence of the contract. Even if it is not of the essence of contract, the Court may infer that it is to be performed in a reasonable time if the conditions are (i) from the express terms of the contract; (ii) from the nature of the property; and (iii) from the surrounding circumstances, for example, the object of making the contract. For the purposes of granting relief, the reasonable time has to be ascertained from all the facts and circumstances of the case. 19. Mrs. Ketty A. Mehta, learned advocate appearing for the appellants has further submitted that the suit was not registered with the registering authority and hence, the doctrine of lis pendence is not applicable. Section 18 of the Registration Act, 1908 deals with documents of which registration is optional. In its application to the State of Maharashtra, in Section 18, clause (ee) was inserted by Bombay Act, 14 of 1939 read with 35 of 1956. Clause (ee) states that notices of pending suit or proceedings referred to in Section 52 of Transfer of Property Act, 1988. Section 2 of Bombay Act, 14 of 1939 as amended by Bombay Act, 17 of 1945 states that this Act shall apply to notices in respect of suits or proceedings which relate to immovable properties situated wholly or partly in the Greater Bombay with effect from such date as may be directed by the State Government in this behalf by Notification in the Official Gazette. The State Government, however, by similar Notification may direct that the Provisions of this Act shall apply to such notices relating to immovable properties situated wholly or partly in such other area as may be specified in the said Notification. By virtue of the Transfer of Property (Bombay Provisions for Uniformity and Amendment) Act, 1959, the provisions of the Transfer of Property and the Indian Registration (Bombay Amendment) Act, 1939 which amended the Trnasfer of Property Act, 1882, in its application to the pre-organisation State of Bombay, are extended to and remained in force in that part of the State of Bombay to which they did not extend immediately before the commencement of the said Act, and, now, the Transfer of Property Act, 1882 is deemed to be amended accordingly also in that part of the State. On the basis of the changes made in this statutory provision, Mrs. Mehta has submitted that the doctrine of lis pendens has no application to the facts of the present case as even after bifurcation of the state of Bombay, if the property is situated in the State of Gujarat and filing of the suit in respect of that property is not registered with