1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION NOTICE OF MOTION NO.659 OF 2007 IN SUIT NO.119 OF 2007 Prasad Gujar ....Plaintiff V/s. Jaganath V. Shiveshwar & Anr. ....Defendants Mr.Chirag Balsara i/b Divya Shah Associates for the Plaintiff. Mr.Mehul Shah i/b Mr.Bharat Joshi for Defendant No.1. CORAM : S.J. VAZIFDAR, J. DATE : 4TH SEPTEMBER, 2009. P.C. :- 1. The suit is filed for specific performance of an agreement to sell a flat on the terms and conditions contained in an agreement in writing dated 3.4.2006 for a consideration of Rs.24,50,000/- between the Plaintiff and the original Defendant. The original Defendant having expired, his son, the present Defendant was brought on record. The Notice of Motion is for the usual reliefs for the appointment of a Court Receiver and for an injunction in such a suit. 2. On the execution of the agreement, a part payment of Rs. 4,50,000/- was made by the Plaintiff to the original Defendant. The balance consideration of Rs.20,00,000/- was to be paid against the delivery of vacant and peaceful possession of the flat by the Defendant to the Plaintiff. Clauses 3 and 6(e) of the agreement read as under :- 2 “3. Since time is the essence of the contract, it is agreed that in the event of any delay or default by the Purchaser in making payment of the balance consideration on the due date, this Agreement shall stand terminated and the Vendor shall be entitled to forfeit the earnest money of Rs.4,50,000/- (Rupees Four Lakh Fifty Thousand only) paid by the Purchaser on the execution hereof and the Purchaser shall have no right, title, interest, claim, or lien of any sort on the said Flat and the Vendor shall be at liberty to sell the said Flat to any other prospective buyer. 6(e). that the Vendor shall obtain the necessary No Objection Certificate from the said Society for transfer, sale of the interest of the Vendor in the said Society, as well as the right, title and interest of the Vendor in the said Flat as herein contained to the Purchaser and also to the admission of the Purchaser to the membership of the said Society in place and instead of the Vendor when the sale herein is completed by delivering the vacant and peaceful possession of the said flat to the Purchaser.” 3. Admittedly, the payment was not tendered on or before 5.5.2006. The question is whether the Defendant rightly terminated the agreement by a letter dated 25.5.2006. 4. It is necessary before referring to the facts to construe clause 6(e) of the agreement. On behalf of the Defendant, it was contended that the Defendant was bound and liable to furnish the N.O.C. only after the Plaintiff made the payment of the balance consideration of Rs.20,00,000/-. According to the Defendant, upon the payment of the said sum of Rs. 3 20,00,000/-, the Defendant was bound and liable only to put the Plaintiff in possession of the said flat and was liable to furnish the N.O.C. of the society only thereafter. 5. I am unable to agree with the construction placed on clause 6(e) on behalf of the Defendant. This clause does not state that the N.O.C. is to be obtained only after the payment of the entire amount and the Plaintiff being put in possession. The word used is “when” and not “after”. It is in fact understandable and only reasonable that simultaneously with the payment of the entire consideration, the Plaintiff’s title is perfected. Without the N.O.C. of the society, the Plaintiff’s title would not be perfect. Indeed it would not even stated on behalf of the Defendant that the original Defendant was entitled to put any party including the Plaintiff in possession without the N.O.C. of the society. The least that must be said is that the Plaintiff’s case is more than just an arguable one. 6. The society addressed a letter dated 12.5.2006 to the I.C.I.C.I. Bank Limited informing the bank that the said flat exclusively stood in the name of the present Defendant but that on 9.2.2008, it was transferred in the name of the original Defendant. The society confirmed that the original Defendant was the only and absolute owner of the flat. Strictly speaking this is not an N.O.C. entitling the purchaser to all the rights including the right of occupation of the flat as far as the society is concerned. It was submitted that the Plaintiff however construed the letter to be the N.O.C. 7. Even assuming that to be so, it would make no difference. Admittedly, even this letter was after the date for performance viz. 4 5.5.2006. Thus one of the objections which was to have been complied with by the Defendant by 5.5.2006 viz. obtaining N.O.C. was in fact complied with after the date of performance. Thus the time in any event ceased to be of the essence of the contract. 8. Admittedly again no notice was served by the Defendant making time of the essence of the contract thereafter. The Defendant, without making time of the essence, issued a notice dated 25.5.2006 terminating the agreement on the ground that the time was of the essence of the contract and the Plaintiff not having made the balance payment on or before 5.5.2006, the original Defendant was entitled to terminate the same. Mr.Balsara submitted that the letter was in fact posted on 16.6.2006 and was received on 20.6.2006. 9. It is true that the Plaintiff by his letter dated 21.7.2006 inter-alia stated that the Defendant in addition to not having obtained the N.O.C., had also not obtained a deed of indemnity from the present Defendant which was apparently asked for by the bank. The letter however does not indicate in any manner that the Plaintiff had refused to perform his obligations if the indemnity was not furnished. It is in fact to the contrary. Paragraph 4 of the letter indicates the Plaintiff’s willingness to perform his obligation, even if the indemnity was not executed. 10. Mr.Balsara submitted that in these circumstances, the Plaintiff ought to be put in possession at the interlocutory stage itself subject only to the Plaintiff depositing the balance purchase price. I am not inclined to pass such an interim order. 11. In the facts and circumstances of this case, the ends of justice 5 would be satisfied by the following order :- i). Pending the hearing and final disposal of the suit, the Defendant is restrained by an order of injunction from disposing of, alienating, encumbering, parting with possession of or creating any third party right, title and/or interest in, to, upon or in respect of the said flat. This order shall also binding on Defendant No.2. The Plaintiff is at liberty to furnish a copy of this order to the society to ensure that the society also does not record any transfer of the said flat. 12. The Notice of Motion is accordingly disposed of.