IN THE HIGH COURT OF JUDICATURE AT MADRAS Dated : 27.07.2009 Coram : THE HONOURABLE MR.JUSTICE K.RAVIRAJA PANDIAN and THE HONOURABLE MR.JUSTICE P.P.S.JANARTHANA RAJA Original Side Appeals Nos.369 and 370 of 2007 Spencer Plaza Owners & Occupants Welfare Association, represented by its President Mr.Ibrahim Appellant in both the appeals v. 1. Southern Car Parkings Ltd., represented by its authorised signatory and Manager - Accounts S.Suresh. Respondent 1 in both the appeals 2. Mangal Tirth Estate Ltd., by its Director Vijay Sadrangani, 769 Anna Salai, Chennai 2. 3. Plaza Maintenance and Services Ltd., represented by its Manager Rahmatullah, 769, Anna Salai, Chennai 2. Respondents 2 & 3 in OSA No.369/2007 2. Mritunjaya Property Services Pvt. Ltd., represented by its Authorised Signatory Kesavan, Spencer Plaza, 769 Anna Salai, Chennai 2. Respondent 2 in OSA No.370 of 2007 Original Side Appeals under Order 36 Rule 11 of the Original Side Rules read with Clause 15 of the Letters Patent against the order dated 08.08.2007 made in O.A. No.306 of 2007 in C.S. No.228 of 2007 and against the order dated 07.09.2007 made in Tr. A. No.5734 of 2007 in C.S. No.228 of 2007. https://hcservices.ecourts.gov.in/hcservices/ For appellant : Mr.V.Raghavachari For respondent 1 : Mr. T.R.Rajagopal, Senior Counsel for M/s.Sampath For respondents 2 & 3 : Mr.G.Masilamani, Senior Counsel, for Mr.V.G.Suresh Kumar JUDGMENT These two appeals are filed by Spencer Plaza Owners & Occupants Welfare Association, the first defendant in the suit in C.S. No.228 of 2007. The appeal in OSA No.369 of 2007 is filed against the interim order granted in favour of the plaintiff, Southern Car Parkings Ltd., (the first respondent herein) restraining the defendant (the appellant herein) from interfering with the peaceful possession and enjoyment of the plaintiff's business of regulating and collecting car parking fees in respect of vehicles (two wheelers and four wheelers) coming to the Spencer Plaza and parked in the open space in the eastern side of the plaza, i.e., near the Oriental Bank of Commerce and in the northern side of the plaza. The appeal in OSA No.370 of 2007 is filed against the order dated 07.09.2007 made in Transfer Application dated 5734 of 2007 in C.S. No.228 of 2007 transferring OS No.2962 of 2007 from the file of the VII Assistant Judge of the City Civil Court, Chennai, to be heard along with C.S. No.228 of 2007. For the sake of convenience, the parties are referred to as arrayed in the plaint. 2. The brief facts, as culled out from the pleadings, are as follows : The plaintiff - Southern Car Parkings Ltd., is a company carrying on the business of managing the parking of cars, two wheelers and all such vehicles. It was awarded the contract of regulating the parking of vehicles both – four wheeler and two wheelers coming to Spencer Plaza. The plaintiff was providing car parking maintenance facilities by collecting necessary charges in respect of the basement portion ever since 01.04.2002 pursuant to an agreement with the second defendant Mangal Tirth Estate Ltd. In respect of eastern side and northern side open space area, the plaintiff was awarded the contract pursuant to an agreement dated 12.08.2006 from the third defendant – Plaza Maintenance and Services Ltd., for a particular sum. In respect of the ground floor referred to above, originally the car parking area was awarded to one Perfect Services. After the contract being awarded to the plaintiff, when the erstwhile contractor Perfect Services interfered with the right of the plaintiff, the plaintiff filed a suit in C.S. No.740 of 2006 and obtained an order of injunction in OA No.786 of 2006. While that being so, i.e., when the contracts granted in favour of the plaintiff are very much in currency and in existence, the first defendant, Spencer Plaza Owners & Occupants https://hcservices.ecourts.gov.in/hcservices/ Welfare Association, issued a circular dated 06.03.2007 proposing to collect charges in respect of areas in the Spencer Plaza. When this circular was brought to the notice of the third defendant, who awarded the contract in favour of the plaintiff and who was in charge of the maintenance of the entire Spencer Plaza consisting of three phases, including the car parking area, the third defendant informed the first defendant that as per the clause contained in the sale deed executed in favour of the purchaser, the entire car park space shall always remain under the control and use of the developer, the second defendant. The said clause of control over the car park area by the developer is in conformity with such covenant contained in the development agreement between the developer and the purchaser. In view of the clause contained in the development agreement as well as in the sale deed, the first defendant has no right in any manner whatsoever to interfere with the right of the plaintiff in maintaining, regulating and collecting parking charges in respect of the vehicles coming to the Spencer Plaza. Despite informing the position to the first defendant, the first defendant is creating lot of problems and on that premise the suit in C.S. No.228 of 2007 has come to be filed seeking for the relief of grant of permanent injunction restraining the first defendant from interfering with the peaceful possession and enjoyment of the suit properties, i.e., carrying on the business of regulating and collecting parking fee in respect of two wheelers and four wheelers in the basement of the Spencer Plaza and in the open space on the eastern side of Oriental Bank of Commerce and in the parking space in front of the first phase of the first floor bearing No.769, Anna Salai, Chennai. To the same effect, the application No.306 of 2007 has been filed for injunction pending suit. 3. That application was defended by the first defendant, Spencer Plaza Owners & Occupants Welfare Association, that they are the owners of the Plaza. The second defendant being the builder, has no right whatsoever on the land and building after it is constructed and sold. It is true that in the sale deed a clause has been inserted about the maintenance and regulation of the entire mall including the car parking area by the third defendant, who is none other than the second defendant builder, but projecting as a separate entity. After coming into force of the Tamil Nadu Apartment Ownership Act, 1994, such a clause contained in the sale deed would not bind the first defendant association. The second defendant, being an association of Spencer Plaza owners formed as per the requirement of the Tamil Nadu Apartment Ownership Act, 1994, it is their obligation to maintain the entire building, such as open space, common space, electricity, water supply and drainage, including car park area. 4. It is the stand of the second defendant that as per the development agreement, the second defendant being the developer, is entitled to 40% of the built up area and the entire basement car parking area and proportionate undivided share in the land. The second defendant is retaining the same and enjoying it as the owner. It is not necessary that the builder's share of the joint https://hcservices.ecourts.gov.in/hcservices/ venture of the present nature has to be sold by the builder. As per the development agreement and sale deed, the second defendant is entitled to maintain the basement car park. 5. It is the case of the third defendant that pursuant to the development agreement and clause contained in the sale deed, the purchasers entered into agreement with the third defendant for maintenance of the entire plaza. The third defendant, pursuant to the agreement entered into with them, by the purchasers who claimed to be the members of the association, they are maintaining the entire Spencer Plaza consisting of three phases over and above 9000 sq. ft., and the car park maintenance has been given in an agreement to the plaintiff, which cannot be faulted by the first defendant. 6. The learned single Judge, after hearing the argument of the parties, having regard to the nature of the suit filed, which is one for permanent injunction and having found prima facie case in favour of the plaintiff, granted interim relief of injunction as prayed for in the application. In respect of the transfer application filed by the plaintiff, after hearing the parties, the learned single Judge observed that the suit in C.S. No.228 of 2005 was filed by Southern Car Parkings Ltd., claiming that the right to regulate car park and collect car parking charges in the basement area was awarded by Mangal Tirth Estate Ltd., to them and the first defendant association now sought to interfere with the right and on that basis the suit came to be filed in May 2007. The applicant in the transfer application claimed that the atrium area exclusively belongs to Mangal Tirth Estate and the applicant was given a right to carry out the promotional activities in all the atriums and that they have been permitted to do advertisements/hoarding in the plaza, besides the atrium area. When the first defendant association threatened to interfere with their right, they filed a suit in O.S. No.2962 of 2007 before the City Civil Court, Chennai and having regard to the totality of the facts and disputes between the parties, the learned single Judge passed orders transferring O.S. No.2962 of 2007 to be heard along with CS 228 of 2007 by this Court. 7. We heard the learned counsel on either side and perused the materials available on record. 8. With reference to the order made in Transfer Application, no argument was advanced, rather, it is accepted by the counsel appearing for the first defendant/appellant that the order cannot be disturbed. 9. Much was argued as to the right of the owners association in respect of the open space, common space, car park area and its obligations to maintain the same with reference to the provisions of the 1994 Act. But, it is an admitted fact that the Tamil Nadu Apartment Ownership Act, 1994, came into force on and from 04.07.1997, whereas the development agreement for development of the plaza and sale deeds executed in favour of the purchasers were https://hcservices.ecourts.gov.in/hcservices/ all well prior to that date, which indisputably contained clauses as to the maintenance of the building and the agreement to be entered into with the third defendant. It is also an undisputed fact that such agreement was entered into with the third defendant for maintaining the plaza by the purchasers who are stated to be the members of the owners association. Pursuant to the agreement, the third defendant granted the right to maintain the car park under dispute to the plaintiff which is still in currency. In the above said facts and circumstances of the case, the only consideration for granting the interim relief is whether the plaintiff is having a prima facie case for grant of interim relief. 10. It is an indisputable fact that the plaintiff has come forward with the suit seeking for an injunction against the first defendant based on the agreement entered into by it with defendants 2 and 3 for the purpose of regulating, maintaining the car parking area - one in the basement and in the ground floor area. It is also not disputed that the agreements are still in existence. 11. The grant of an interlocutory injunction during the pendency of legal proceedings is a matter requiring the exercise of discretion of the Court. While exercising the discretion, the Court has to apply the following tests – (i) whether the plaintiff has a prima facie case; (ii) whether the balance of convenience is in favour of the plaintiff; and (iii) whether the plaintiff would suffer an irreparable injury if his prayer for interlocutory injunction is disallowed. The decision whether or not to grant an interlocutory injunction has to be taken at a time when the existence of the legal right assailed by the plaintiff and its alleged violation are both contested and uncertain and remain uncertain till they are established at the trial on evidence. Relief by way of interlocutory injunction is granted to mitigate the risk of injustice to the plaintiff during the period before that uncertainty could be resolved. The object of the interlocutory injunction is to protect the plaintiff against injury by violation of his right for which he could not be adequately compensated in damages recoverable in the action if the uncertainty were resolved in his favour at the trial. The need for such protection has, however to be weighed against the corresponding need of the defendant to be protected against injury resulting from his having been prevented from exercising his own legal rights for which he could not be adequately compensated. The Court must weigh one need against another and determine where the 'balance of convenience' lies. In order to protect the defendant while granting an interlocutory injunction in his favour the Court can require the plaintiff to furnish an undertaking so that the defendant can be adequately compensated, if the uncertainty were resolved in his favour at the trial. Under Order 39 of the Code of Civil Procedure, jurisdiction of the Court to interfere with an order of interlocutory or temporary injunction is purely equitable and, therefore, the Court, on being approached, will, apart from other considerations, also look to the conduct of the party invoking the jurisdiction of the Court, and may refused to https://hcservices.ecourts.gov.in/hcservices/ interfere unless his conduct was free from blame. Since the relief is wholly equitable in nature, the party invoking the jurisdiction of the Court, has to show that he himself was not at fault and that he himself was not responsible for bringing about the state of things complained of and that he was not unfair or inequitable in his dealings with the party against whom he was seeking relief. His conduct should be fair and honest. These considerations will arise not only in respect of the person who seeks an order of injunction under Order 39 Rule 1 or 2 of the Code of Civil Procedure, but also in respect of the party approaching the Court for vacating the ad interim or temporary injunction order already granted in the pending suit or proceedings. (See Gujarat Bottling Co. Ltd. v. Coca Cola Co., (1995) 5 SCC 545). 12. In this case, the suit is for a bare injunction. It is an admitted fact that as on today, the plaintiffs are regulating the car parking under the subsisting contract entered into by them. Considering the nature of the relief with reference to the facts narrated above, we are of the view that the plaintiff has made out a prima facie case and we are also further of the view that in order to see whether the grant of an interim injunction pending suit is correct or not, it is not necessary for us to go into the correctness, enforceability or otherwise of the clause contained in the development agreement and the sale deed, which requires the purchaser to enter into an agreement with the third defendant for the purpose of maintenance of the plaza or as to whether such clause can be validly enforced with reference to the provisions contained in the Act, particularly when such clause has been faithfully obeyed by the first defendant's members by entering into an agreement with the third defendant. 13. As regards the second test of balance of convenience, it could be seen that as per the agreement between the plaintiff and defendants 2 and 3, the plaintiff is maintaining the car park by investing substantial amount for manpower and other infrastructure. The agreement is also in currency. Whether the agreement is legally sustainable or not is a point in issue to be decided in the suit. It is also not in dispute that for the past several years, the present state of affairs was followed in respect of maintaining the car park, the first defendant did not maintain the car park. Even assuming that the first defendant is entitled to maintain, it is going to be given to the third party. The first defendant itself is not going to do the exercise of maintaining the car park, which is a mammoth exercise. Hence, we are of the view that the balance of convenience is also more in favour of the plaintiff. 14. As far as the third test is concerned, if the injunction is not granted, having regard to the agreement entered into by the plaintiff and the amount expended by him, definitely that would cause prejudice to the plaintiff. Even the interest of the defendant has also been protected by an order of this Court, which https://hcservices.ecourts.gov.in/hcservices/ directed the plaintiff to deposit the amount collected for the car park after defraying the expenses, into the bank. There cannot be any prejudice to the defendant in granting the prayer in favour of the plaintiff. The right of the first defendant regarding the open space and parking slot and who is to maintain the same has to be considered in the suit. Likewise, the right of the second defendant, the promoter who claims 40% of the built up area along with undivided share is still with them and he is the owner of that portion of the property and he can exploit the property as per his convenience is also a question to be decided in the suit. So, is the correctness and validity of the agreement entered into by the owners of the premises of the Spencer Plaza with the third defendant for maintenance of the entire premises. 15. Much was concentrated by the counsel on behalf of the plaintiff as to the validity of the clause contained in the development agreement and sale deed vis-a-vis the provisions contained in the Act. We are conscious of the fact that we cannot enter into the arena of that issue at this stage and any discussion, if made on that issue, would definitely have a bearing in the proceedings between the parties before the trial Court. Hence, we refrain from entering into that arena of discussion. We are equally conscious of the fact that what is tested before us is is the correctness of the order of the learned single Judge granting interim injunction in favour of the plaintiff with which we agree. 16. For the foregoing reasons and the discussions made, we are of the view that the appeals deserve to be rejected. The appeals are dismissed. No costs. 27.07.2009 Today, after pronouncing the judgment in these appeals, learned counsel for defendants 2 and 3 submits that this Court, by order dated 21.04.2008 directed the respondents 1 to 3 collectively to deposit the collection from the car park area, which is the subject matter of the appeals, once in a month to the credit of OSAs. Nos.369 and 370 of 2007 and also directed to maintain and file true and proper account for the charges collected and the expenses incurred. That interim order further directed the Registrar General of the Madras High Court to redeposit the same in the Indian Bank, High Court Branch for a period of two months. That order may be vacated. While passing the orders on these appeals, we have taken note of the earlier direction of this Court dated 21.04.2008 and we regarded that such direction would protect the interest of the first defendant in granting the interim order against it. So, the direction, if at all, could be varied by directing the respondents https://hcservices.ecourts.gov.in/hcservices/ themselves to deposit the collections from the car park area in a separate interest bearing bank account after defraying the expenses incurred by them for the purpose of maintaining the car park once in a month. However, the direction given in respect of maintaining and filing true and proper accounts, no variation is made. mf Sd/- Asst.Registrar /True Copy/ Sub.Asst.Registrar To 1. The Sub Assistant Registrar Original side High court, Madras. 2. The Section Officer, Accounts Section, High court Madras (for necessary action) + 1 cc to Mr. V. Raghavachari, Advocate Sr.34475. + 2 cc to Mr. M.S. Sampath Advocate, SR.32591. + 1 cc to Mr. V.G. Suresh Kumar SR.35081. Judgment in OSAs Nos.369 and 370 of 2007 KA(CO) EU 24.8.2009. https://hcservices.ecourts.gov.in/hcservices/