( 1 ) IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION USJ NOTICE OF MOTION NO.1488 OF 2006 NOTICE OF MOTION NO.1488 OF 2006 NOTICE OF MOTION NO.1488 OF 2006 IN IN IN SUIT NO.1239 OF 2006 SUIT NO.1239 OF 2006 SUIT NO.1239 OF 2006 Babiben alias Bebiben Vasant Shah age about 50 years, Occ. Household, residing at Nandlal Manchharam Building, Room No.2, Bldg.No.40, 3rd Floor, 1st Sutar Gali, Mumbai - 400 004. ..Plaintiff V/s. 1. M/s. Rushi Construction, a partnership Firm having office at Patel House, M.G. Road, Vile Parle (E), Mumbai-400 057 2. Baggi Aswani, adult, Occ. Business, Residing at F/504, RNA Regency Park, M.G. Road, Kandivali (W),. Mumbai - 400 067. ..Defendants ...... Mr. V.L. Desai for plaintiff Mr. Rajiv Narula with Mr. P.Patel i/by J. Narula & Associates for defendant No.1 Mr. D.D. Mehta i/by D.M. Legal Associates for defendant No.2. ...... CORAM : R.Y. GANOO, J. CORAM : R.Y. GANOO, J. CORAM : R.Y. GANOO, J. DATED : 17th March, 2009 DATED : 17th March, 2009 DATED : 17th March, 2009 Judgment : Judgment : Judgment : 1. The plaintiff has instituted this suit for reliefs to have the agreement which is reflected in terms of letter of allotment dated 4.12.1993 specifically performed. The suit arrangement is between the plaintiff and defendant No.1. The defendant No.2 is joined as party defendant as at a specific stage plaintiff came to know that defendant ( 2 ) No.1 is likely to dispose of the suit flat i.e. Flat No.502, Rushivan, Kaju Pada, Borivali (E), Mumbai - 400 066 to defendant No.2. 2. The plaintiff has approached this Court with positive case that on 03.12.1993, defendant No.1 agreed to sell to plaintiff Flat No.502, Rushivan, Kaju Pada, Borivali (E), Mumbai - 400 066 (herein after referred to as the "suit flat") for a sum of Rs.3,74,325/-. According to plaintiff, a letter of allotment came to be issued by defendant No.1 to plaintiff on 4.12.1993. As per the letter of allotment, plaintiff has paid a sum of Rs.3,29,455/- which fact is admitted by defendant No.1 in the affidavit in reply. According to plaintiff, Rs.44,920/- were to be paid to defendant No.1 on delivery of the possession of the suit flat to him. According to plaintiff defendant No.1 has by letter dated 20.3.2006 terminated the agreement and allotment of suit flat. Plaintiff has also stated that he came to know that a letter of allotment dated 27.3.2006 has been issued in favour of the defendant No.2, which led to amending the plaint and joining defendant No.2 as party defendant. 3. The defendant No.1 sent a letter dated 18.7.2005 demanding Rs.1,49,100/- towards escalation ( 3 ) charges and Rs.78,780/- towards other charges as per list attached to the said letter. According to defendant No.1, the said amount was not paid by the plaintiff. According to defendant No.1 again a letter dated 19.8.2005 demanding the said amount was issued, however, plaintiff did not comply with the said demand. In substance, it has been the stand of the defendant No.1 that because plaintiff did not comply with requisitions contained in letters dated 18.7.2005 and 19.8.2005, defendant No.1 had no option but to terminate the booking and show willingness to refund the amount to plaintiff, which was paid by plaintiff to defendant No.1. Defendant No.2 has very little role to play except contending to that defendant No.2 was a purchaser of a suit flat as bonafide purchaser for consideration without notice of the earlier transaction. 4. By this motion, plaintiff wants an order of injunction restraining 1st defendant from creating third party rights and / or part with possession of suit flat. By prayer clause (b), plaintiff wants appointment of Court Receiver in regard to the suit flat. The plaintiff has shown willingness to deposit the balance consideration of Rs.44,920/-. The plaintiff also wants that flat should not be allotted to defendant No.2 pursuant to the letter of allotment ( 4 ) dated 27.3.2006. 5. With the aforesaid factual developments the hearing of the motion did take place. I have heard learned Counsel Mr. Desai appearing on behalf of the plaintiff and learned Counsel Mr. Rajiv Narula appearing on behalf of defendant No.1. I have also heard learned Counsel Mr. Mehta appearing on behalf of defendant No.2. 6. The terms of allotment letter if perused in totality, it is clear that defendant No.1 had agreed to sell the suit flat to the plaintiff for a total consideration of Rs.3,74,325/-. No doubt, in the last portion of the letter of allotment, a clause is added by which it is sought to be conveyed that till such time the regular agreement of Sale is not executed, the money as paid by the plaintiff would be treated as a loan transaction. The relevant clause is as under:- "Regular agreement of sale will be executed only on receipt of full and final consideration from you till that the amount paid by you will be considered as a loan to our firm, as also after the details particulars sought for are furnished by you". 8. It was contended by defendant No.1 that the letter of allotment goes to indicate that the transaction is a loan transaction, which cannot be accepted. In fact, if one peruses the text of the ( 5 ) letters of allotment dated 4.12.1993 and two aforesaid letters dated 19.8.2005 and 20.3.2006, it is clear that the intention of the defendant No.1 was to sell the suit flat. If defendant No.1 was not to sell suit flat, defendant No.1 would not have called upon the plaintiff to pay the various charges set out in letter dated 18.7.2005, which are normally required to be paid by a flat purchaser. Hence, the argument that the transaction was a loan agreement is rejected. 9. It was sought to be argued by learned Counsel for defendant No.1 that there was no regular agreement was executed between the plaintiff and defendant No.1 and the suit is filed on the strength of the letter of allotment and therefore, the institution of the suit is not proper in the absence of a formal agreement and therefore interim relief should not be granted. I am not inclined to accept this argument because the agreement was required to be executed by defendant No.1 as a developer with the plaintiff and it is clear that the parties had chosen to govern themselves by the letter of allotment till the regular agreement of sale was executed. Defendant No.1 seems to be in the habit of issuing letters of allotment instead of executing regular Agreement of Sale. I am saying this on the strength of a letter of allotment which was issued in favour of defendant No.2 on 27.3.2006 the ( 6 ) terms of which are similar to the letter of allotment issued in favour of the plaintiff. Certainly defendant No.1 now cannot say that he had not executed any agreement with defendant No.1 to sell the suit flat. To that extent, the contention of the defendant No.1 that the suit is not maintainable on the strength of the bare letter of allotment cannot be accepted. 10. My attention was drawn to the letter dated 18.7.2005 which is annexed to the affidavit in reply filed by defendant No.1. According to defendant No.1, the said letter was duly served upon the plaintiff and monies were not paid as per demand and therefore, the plaintiff was in breach of the terms of the arrangement and therefore, plaintiff’s arrangement was required to be terminated. My attention was drawn to clause 34 reproduced in letter dated 18.7.2005 on the strength of the escalation charges were sought to be demanded. In reply to the Courts query, as to where is that agreement said to even executed between the plaintiff and defendant No.1, in which clause 34 appears, learned Counsel for defendant No.1 had to reply that no agreement has been entered into between the plaintiff and defendant No.1. If this be so, the stand taken by defendant No.1 in the letter dated 18.7.2005 making plaintiff liable to pay escalation charges of Rs.1,49,100/-, cannot be accepted. Once, ( 7 ) it is noted that the plaintiff was not liable to pay escalation charges, no further action could have been taken by defendant No.1 for non-payment of the said escalation charges. Insofar as the other charges as legal fees, development charges and 12 months maintenance deposit etc. are concerned, it is required to be noted that in the letter of allotment there are no specific amounts mentioned as regards charges which are to be paid towards registration, legal charges etc. and therefore, non-payment of said charges by the plaintiff cannot be considered as a default because no agreement said to have been produced before the Court by defendant No.1 whereby the plaintiff had agreed to pay quantified amount towards the various charges. Argument was advanced by learned Counsel Mr. Desai that the letter dated 18.7.2005 was sent at a different address than where the plaintiff was residing or having his office and the said fact is required to be accepted because the letter dated 18.7.2005 is sent at 171, Trimbak Parshuram Street, Kumbharwada, 6th Lane, Mumbai - 400 004. whereas the letter of allotment was sent at different address and it is not the case of defendant No.1 that the plaintiff had communicated to defendant No.1 new address where the communication should be addressed. With this, even if defendant No.1 has been able to produce some acknowledgment of courier that by ( 8 ) itself does not show that the letter dated 18.7.2005 was duly served upon the plaintiff. In any event, in the absence of a regular agreement between the defendant No.1 and the plaintiff, there was no question of paying escalation charges and various charges. Till execution of a detailed agreement, defendant No.1 could expect from the plaintiff last instalment of Rs.44,920/-. 11. It was sought to be argued by Counsel for defendant No.1 that the suit is instituted beyond the period of limitation. Insofar as this aspect is concerned, it is very clear that the parties had not fixed the dated for the purposes of completing the transaction and, therefore, the period of limitation commenced from the day when the plaintiff had noticed that the performance is being refused. This is so in view of Article 54 which governs the suit transaction. It is required to be mentioned that the booking came to be cancelled by defendant No.1 specifically in terms of letter dated 20.3.2006. This will mean that for the first time, plaintiff came to know that the arrangement between plaintiff and defendant No.1 got terminated in terms of letter dated 20.3.2006. The suit is instituted in the year 2006 itself and hence stand of defendant No.1 that the suit is instituted beyond the period of limitation cannot be accepted. ( 9 ) It may be true that the letter of allotment was issued in the year 1993 however, no positive steps were taken by defendant No.1 to take the said arrangement any further and it is only in the year 2005, 2006 correspondence in terms of letters dated 18.7.2005, 19.8.2005 and 20.3.2006 was extended. If this is the position, certainly the plaintiff cannot be blamed for not putting forthwith his case before the Court prior to 20.3.2006. 12. Defendant No.2 is undoubtedly claiming through defendant No.1. It may be that a letter of allotment is issued in favour of defendant No.2 however, that will be done subject to letter of allotment issued in favour of defendant No.1 Considering all the aspects which are discussed above, it is clear that the letter cancelling the booking dated 20.3.2006 cannot be accepted and the case of the plaintiff that he is ready and willing to perform his part of the contract will have to be accepted because defendant No.1 has not been able to show any circumstance by which it can be said that the plaintiff is not ready and willing to perform his part of the contract. In fact, a prayer in the Notice of Motion that the plaintiff be directed to deposit in this Court a sum of Rs.44,920/- is sufficient to say that the plaintiff is interested in performing his part of the contract. In view of the ( 10 ) above, I am inclined to observe that the plaintiff has made out a prima facie case for grant of Specific Performance of the suit arrangement in terms of the letter of allotment. 13. Next question is whether the interest of justice would be sufficient if injunction granted against defendant No.1 thereby restraining defendant No.1 from creating any third party interest and / or part with possession or Receiver should be appointed and plaintiff should be appointed as an agent of the Receiver. In so far as this aspect is concerned, the plaintiff has already paid to defendant No.1 a sum of Rs.3,29,455/-. The plaintiff has shown his willingness to pay defendant consideration to the tune of Rs.44,920/-. It is required to be stated that defendant No.1 in an unjustified manner raised the stand of escalation charges without entering into the formal agreement. Defendant No.1 also raised the demand towards various charges to the tune of Rs.30,000/- and odd for various items which are mentioned in the earlier part of the order. Defendant No.1 knowing fully well that plaintiff has been allotted the suit flat, proceeded to allot the suit flat to defendant No.1. In my view, with this conduct of defendant No.1 grant of injunction simplicitor is not sufficient and in my view this is a fit case where ( 11 ) Receiver, High Court Bombay is required to be appointed. 14. Now the question is whether the plaintiff should be appointed as agent of Court Receiver. In my view, this question is required to be answered in the affirmative. Here is a case where a person who is interested in purchasing the flat has paid practically 80% of the total consideration to the developer and waited to get possession of the suit flat. Plaintiff was deprived of the benefit of possession and the money which had been paid by him to defendant No.1 towards purchase of suit flat. Since the plaintiff has shown willingness to pay balance consideration i.e. last instalment, it is clear that the plaintiff wants possession of the suit flat. In my view, this is a fit case where the plaintiff should be appointed as an agent of the Court Receiver on depositing the balance consideration of Rs.44,920/-. The plaintiff ofcourse will have to pay the usual outgoings, which are being paid by the other flat purchaser for the same area. That will have to be deposited with the Receiver and that the Receiver shall in turn pay it to the defendant No.1. In my view, once this arrangement is arrived at, there is no need to pass an order of injunction as set out in the prayer clauses except that till such time, the Receiver takes formal ( 12 ) possession of the suit flat the order of injunction is required to be granted against defendant No.1 so as to see that third party right are not created or new person is not inducted in suit flat. 15. In my view, for the reasons mentioned aforesaid, the plaintiff has made out prima facie case for grant a relief as aforesaid. Since the plaintiff is being directed to deposit a sum of Rs.44,920/- and since the said amount being ordered to pay defendant No.1, no prejudice will be caused to defendant No.1. For the reasons mentioned aforesaid, I pass following order. ORDER ORDER ORDER . Receiver, High Court Bombay is hereby appointed in respect of the suit flat more particularly set out in prayer clause (a) of the plaint. . Plaintiff shall deposit in this Court a sum of Rs.44,920/- on or before 15th April, 2009. Upon plaintiff depositing the aforesaid amount in this Court, Receiver shall handover the possession of the suit flat to the plaintiff as his agent and shall execute ( 13 ) necessary agency agreement. There is no need for the plaintiff to furnish security to the satisfaction of the Receiver. The plaintiff however, shall pay to the Receiver, the maintenance charges which are being paid by similar flat purchaser and that amount shall be in turn paid to defendant No.1. Rs.44,920/- which will be deposited by the plaintiff in this Court be paid to defendant No.1 towards the payment of the consideration as set out in the letter of allotment dated 4.12.1993 and receipt of the same by defendant No.1 shall be without prejudice to the rights of defendant No.1. Till such time, the Receiver takes possession of the suit flat pursuant to this order there shall be an order of injunction restraining defendant No.1, his agents and servants from creating third party rights and / or parting with possession in regard to the suit flat. It is required to be noted that defendant No.1 has not stated before this Court in the course of hearing of this motion that suit flat is in possession of some other person. If the Receiver finds that some other person i.e. other than representative of defendant No.1 in possession of the suit flat, the Receiver shall arrange ( 14 ) to take possession of the suit flat even with the help of Police assistance. If the representative of defendant No.1 is in possession of the suit flat, the said representative will handover the possession to the Receiver so as to comply with this order. . Notice of Motion stands disposed of in the above terms with no order as to costs. . After the aforesaid order is passed learned advocates for defendant Nos. 1 and 2 respectively prayed for stay of the operation of this order. Counsel for plaintiff opposed the request. In my view, the order as regards the appointment of Court Receiver can be stayed for sometime. The order by which defendant No.1 is restrained from transferring the suit flat and / or creating third party rights and / or parting with possession cannot be stayed as otherwise, there is every chance that in the absence of order defendant No.1 would transfer suit flat in favour of defendant No.2 or any one else. In view of this, till 8.5.2009 operation of this order about Receiver is stayed, however, it is ordered that till 8.5.2009 there shall be an ( 15 ) order of injunction against defendant No.1 restraining it from creating third party rights, transferring or parting with possession of suit flat to anybody else. It is noted that this order is passed in the presence of Counsels for defendant Nos. 1 and 2 respectively. . Suit is expedited as plaintiff is a female litigant. Office to place it in expedited list accordingly. (R.Y. GANOO, J.) (R.Y. GANOO, J.) (R.Y. GANOO, J.)