- 1 - VPH IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION NOTICE OF MOTION No. 1446 OF 2007 IN SUIT No. 1044 OF 2007 Munna R. Puthalappa ... Plaintiff Vs. Ramesh Harilal Mehta & Anr. ... Defendants *** Mr. M. V. Holmagi, for the Plaintiff. Mr. A. S. Tungare, for the Defendants. *** CORAM : S. J. VAZIFDAR, J. DATE : OCTOBER 6, 2009. PC :- 1. The suit is filed for specific performance of an agreement dated 18th March 2005. 2. By this agreement the plaintiff had agreed to sell to defendant No.1 the immovable property, admeasuring 1416 sq. mt. It appears that the property has been developed pursuant thereto under an internal arrangement between defendant Nos. 1 and 2. The recitals in the agreement as well as the operative clause thereof indicate that the plaintiff had represented that he was in possession of the property and that he was the absolute owner thereof, having acquired the same from the previous owners. - 2 - . Under this agreement the plaintiff granted defendant No.1 the development rights with a clear and marketable title free from all encumbrances. In consideration thereof the plaintiff was to be given a sum of Rs.10,00,000/-, 8 shops admeasuring in the aggregate 3073 sq. ft. along with basement thereunder admeasuring 2997 sq. ft. and two flats admeasuring in the aggregate 1837 sq. ft. . On the execution of the agreement a sum of Rs.5,00,000/- was paid by defendant No.1 to the plaintiff. The development is now complete. The premises agreed to be handed over to the plaintiff are ready for occupation. The execution of the agreement is not denied, That the possession of the property was obtained by the defendants from the plaintiff is not denied. 3. This Notice of Motion seeking the appointment of the Court Receiver, injunction and other interim reliefs, is opposed only on the ground that the plaintiff had failed to make out a marketable title and that the defendants had as a consequence thereof faced several claims and objections from third parties. It is contended that the defendants were compelled therefore, in the interest of their project, to settle these claims. It is further contended that the defendants were required to pay a sum of about Rs.1,20,00,000/-. However, from the documents referred to and relied upon in the pleadings, the defendants were able to show such alleged expenditure only to the extent of about Rs.91,00,000/-. 4. I will assume for the purpose of this Notice of Motion - 3 - that the plaintiffs have not yet made out a marketable title. I cannot presume however, that the plaintiff will fail to do so for all times. The fact of the matter is that the defendants have taken benefit under the said agreement inter alia by taking possession of the property from the plaintiff. It is in fact admitted that the property or at least a part thereof was surrendered towards set back area. This in fact indicates that the defendants have taken advantage under the agreement. Even assuming that the defendants have paid a sum of about Rs.90,00,000/- towards settling the claims of third parties as aforesaid, there is no justification for allowing them to continue in occupation of the entire constructed portion to be handed over to the plaintiffs without imposing any terms and conditions. According to the plaintiff, the value of the property is about Rs.4,000/- per sq. ft. for residential premises. According to the defendants, it is not less than Rs.8,000/- per sq. ft. for residential premises. Thus, even accepting the defendants’ valuation to be correct for residential premises, their interest would be adequately protected at least to the extent of the liabilities they have already been allegedly exposed to by permitting them to occupy the residential premises without payment of royalty and security. The residential premises as stated above admeasures 1837 sq. ft. There is no justification for their continuing to occupy the commercial premises without any conditions. 5. In the circumstances, the Notice of Motion is disposed of by the following order: - 4 - ORDER (i) The Court Receiver is appointed receiver of the two flats, 8 shops and the basement thereunder. (ii) The defendants shall be entitled to be appointed as the agents of the Court Receiver in respect of the residential flats without payment of security or royalty but subject to payment of all outgoings and expenses connected with the maintenance thereof. (iii) The defendants shall be entitled to be appointed as the agents of the Court Receiver in respect of the eight shops and the basement thereunder subject to payment of royalty to be determined on the basis of the market rate for leave & license agreements of similar premises. (iv) In the event of the defendants not agreeing to accept the agency of the Court Receiver for any of the premises, the Court Receiver shall appoint any third party to be the agent for the said premises after inviting the bids for the same. Liberty to the parties to bid for the agency of the Court Receiver. (v) Liberty to the plaintiff to apply for withdrawal of the amounts or a part thereof by a separate Notice of Motion. All contentions of the parties are kept open.