Civil Revision No.1561 of 2009(O&M) [ 1 ] IN THE HIGH COURT FOR THE STATES OF PUNJAB & HARYANA AT CHANDIGARH ... Civil Revision No.1561 of 2009 (O&M) Decided on : August 25, 2009 Smt.Paramjit Panag and others ... Petitioners VERSUS Mansa Land Developers and another ... Respondents CORAM : HON'BLE MR.JUSTICE A.N.JINDAL Present: Mr.Arun Palli, Senior Advocate assisted by Mr.KVS Kang, Advocate for the petitioners. Mr.Yogesh Goyal, Advocate for the respondents. A.N.JINDAL, J.- This revision petition is directed against the order dated 2.1.2009 passed by District Judge, Patiala, reversing the order dated 2.2.2008 passed by Additional Civil Judge (Senior Division), Patiala, refusing to grant temporary injunction restraining the defendants – petitioners (herein referred as the defendants) from alienating the suit land during the pendency of the suit. Some admitted facts are that Smt.Paramjit Panag, Smt.Satwant Boparai, Smt.Iqbal Sidhu and Smt.Jaswinder Kaur were the owners of the land measuring 19 Killas and 4 Bighas situated in village Kishanpura, Tehsil Dera Bassi, District SAS Nagar, Mohali and vide agreement dated Civil Revision No.1561 of 2009(O&M) [ 2 ] 4.4.2005, they agreed to sell the aforesaid land at the rate of Rs.50,50,000/- per acre (four bighas) in favour of the plaintiff. Vide the said agreement, they received a sum of Rs.one crore through four different cheques and the date for registration of the sale-deed was agreed as 4.7.2005. It was further termed in the agreement that in case the defendants refuse to get the sale-deed registered, then the buyers after depositing the remaining amount would be entitled to get the sale-deed registered and to claim the expenses through Court. If the plaintiffs resile from the agreement, then their amount of earnest money shall be forfeited and the deal will be cancelled. It was also averred that much prior to the stipulated date i.e. 27.5.2005, with the mutual understanding of the parties, the date for registration of sale- deed was extended from 4.7.2005 to 15.7.2005 vide document Annexure P-4. It is further averred that the plaintiff always remained ready to execute the sale-deed, but the defendants No.1 to 4 did not turn up. A notice on the counsel of defendants No.1 to 4 was served, but to no response. On the stipulated date i.e. 24.3.2006, the plaintiff remained present before the office of Sub-Registrar throughout the day, but the defendants did not turn up and they constructed a false story regarding the non-presence of the plaintiff on 15.7.2005 and 15.9.2005, but no such date was ever fixed by the plaintiff for getting the sale-deed registered. Thus, the plaintiff had to file the suit for specific performance of the contract along with an application under Order 39 Rule 1 and 2 of the Code of Civil Procedure for restraining the defendants from interfering in the suit land. Civil Revision No.1561 of 2009(O&M) [ 3 ] The suit as well as the application were contested by the defendants, wherein, they while admitting the execution of the agreement and receipt of the amount of Rs.one crore, further averred that it were not defendants, but it was the plaintiff, who was at fault and was never ready to execute the sale-deed. The time was the essence of contract in the present case as they while issuing a specific notice to the plaintiff, ensured that if he did not get the sale-deed executed by 15.9.2005, then the earnest money would stand forfeited and the agreement would be cancelled. However, on the stipulated date as well as the extended date, the plaintiff did not turn up to perform the agreement. While reproducing the circumstances, it was reiterated that the sale-deed was to be executed on 4.7.2005 after payment of the remaining sale-consideration, but the plaintiff kept on putting off the matter and the defendants acceded to its requests. After the persistent efforts made by the defendants, the plaintiff agreed to get the sale-deed executed on or before 15.9.2005. To ensure this promise and on insistence of the defendants, Tajinder Singh and Rajiv Gabba representing the plaintiff gave in writing promising that sale-deed would be executed on 15.9.2005. Vide endorsement Rajiv Gabba also accepted the non-fulfillment of the commitment by the plaintiff and further agreed to pay interest @ 18% per annum on the total amount for the intervening period i.e. 15.7.2005 to 15.9.2005. The other averments made by the defendants are that despite a legal notice served upon the plaintiff firm that it should get the sale-deed registered after making the payment of the balance sale-consideration by 15.9.2005, failing which the agreement shall stand cancelled and the earnest Civil Revision No.1561 of 2009(O&M) [ 4 ] money shall stand forfeited, but it failed to comply with the terms of the agreement till the extended date, as fixed by the parties. As such, now the plaintiff has no right to compel the defendants to enforce the contract and no prima facie case is made out in his favour for grant of injunction. The Trial Court dismissed the application for grant of injunction on the following grounds:- (i)The plaintiff has malafidely and intentionally have denied the writing dated 16.8.2005 and also the receipt of the notice sent by the defendants to the plaintiff. The plaintiff is trying to play hot and cold in the same breath and his stand in this regard cannot be relied upon. Since, Tejinder Singh and Rajiv Gabba, the representatives of the firm had executed the writing dated 16.8.2005, therefore, the plaintiff firm was bound to get it registered on 15.9.2005 and the fact with regard to the non-availability of the C.L.U. (Change of Land Use) is very clear from this writing, which was endorsed by Rajiv Gabba on 19.8.2005, clarifying that the delay in execution of the sale-deed was on the part of the plaintiff. The denial of this document goes a long way to prove the shabby conduct of the plaintiff. (ii)It was only on the basis of document dated 16.8.2005 that the plaintiff claims that he remained present in the office of the Sub Registrar on 15.9.2005, then, how he could deny the document dated 16.8.2005. The plaintiff had malafide intention and was not ready to execute the sale deed. The Civil Revision No.1561 of 2009(O&M) [ 5 ] plaintiff is not in possession of the suit land. In any case, if further sale is effected, then the same would suffer from principles of lis pendens. In appeal, the learned District Judge reversed the judgment while following two judgments delivered in cases of Maharwal Khewaji Trust (Regd.), Faridkot vs. Baldev Dass, 2005(1) Civil Court Cases 430 (SC) and Raj Singh vs. Inder Jeet, 2005(2) Civil Court Cases 690 (P&H). Having heard the rival contentions and on perusal of the record of the case, it transpires that the order passed by the Appellate Court is independent of the order passed by the Trial Court, without examining as to in what manner the order passed by the Trial Court is perverse, arbitrary, against facts and not conform to the essentials for grant of injunction. The Appellate Court has also failed to observe if the Trial Court ignored any material fact while recording the findings against the plaintiff and the conclusions drawn by it were perverse and the Trial Court could not form such opinion on facts and the discretion exercised by it was autocratic or arbitrary. In such situation, the order passed by the Appellate Court could be said to be completely against law and misconceived. Similar observations were made by this Court in case Guru Nanak Education Trust, vs. Balbir Singh, 1995(2) The Punjab Law Reporter 625, wherein, it was observed as under:- “18. A reading of the order passed by the Appellate Court Civil Revision No.1561 of 2009(O&M) [ 6 ] shows that the said Court has no where recorded a finding that the trial Court has recorded a finding of prima facie case, balance of convenience and irreparable loss without applying the settled principles of law or that it has ignored any material fact while recording a finding in favour of the plaintiff – petitioners. The lower Appellate Court has also not held that the conclusions recorded by the trial Court are perverse or are against the settled principles of law. Without recording any such finding, the Appellate Court has proceeded to contradict the conclusions recorded by the trial Court and in my opinion this course adopted by the Appellate Court has the effect of rendering its order as patently illegal and the one which has occasioned failure of justice. The extent and scope of jurisdiction of the lower Appellate Court to interfere with the order passed by the trial Court in exercise of its jurisdiction under Order 39, rules 1 and 2, has been discussed in Smt.Vimla Devi vs. Jang Bhadur, AIR 1977 Rajasthan 196. A learned Single Judge of that Court has summed up the legal position in the following words:- “The order refusing temporary injunction is of a discretionary character. Ordinarily Court of appeal will not interfere with the exercise of discretion by the trial Court and substitute for it its own discretion. The interference with the discretionary order, however, may be justified if the lower Court acts arbitrarily or Civil Revision No.1561 of 2009(O&M) [ 7 ] perversely, capriciously or in disregard of sound legal principles or without considering all the relevant records. The mere possibility of the Appellate Court coming to a different conclusion on the same facts and evidence will also not justify interference.” 19. The same view has been expressed by this Court in Krishan Kumar's case (supra). In that case, this Court has observed:- “A perusal of the Appellate Court's order shows that it has not assigned any cogent reason to set aside the discretion exercised by the trial Court. The lower Appellate Court has not demonstrated as to how on admitted facts and principles of law have been wrongly applied. I am, therefore, of the opinion that the lower Appellate Court was not justified in setting aside order and interfering in the discretion exercised by the Trial Court.” 20. Since the lower Appellate Court has ignored the well established principles of law which govern the exercise of its jurisdiction qua an order passed by the trial Court, the impugned order is liable to be set aside in the exercise of revisional jurisdiction of this Court under Section 115.” Having scrutinised the impugned order passed by the Appellate Civil Revision No.1561 of 2009(O&M) [ 8 ] Court, it is apparent that the same is misconceived. The Appellate Court has misdirected itself in appreciating the controversy raised before it. The Appellate Court appears to have moved only on the basis of two assumptions that there was a valid agreement dated 4.4.2005 in favour of the plaintiff under which he had paid an earnest money of Rs.one crore against total consideration of Rs.9,49,40,000/- The Appellate Court has recorded that the plaintiff was ready and willing to perform the contract on the extended date i.e. 15.7.2005 and it also served a notice dated 14.3.2006 to execute the sale-deed, but the defendants did not turn up. It further observed that since the execution of the agreement is admitted between the parties and they were ready to perform their part of contract, therefore, the plaintiff had a prima facie case in its favour and if the land is sold to somebody else, then more complications would arise, but the Appellate Court did not examine and appreciate the other admitted facts, which may be summarised as under:- Vide agreement dated 27.5.2005 (Annexure P-4), the time for execution of the sale-deed was extended upto 15.7.2005, but the sale-deed could not be executed on this stipulated date, therefore, if the defendants had bad intention to back out from the agreement, then they would not have offered to sell the land to the plaintiff under the agreement and the writing dated 16/19.8.2005 (Annexure P-5) executed by Tejinder Singh (the person, who had entered into agreement on behalf of the plaintiff) and Rajiv Gabba, their representative, given on the letter-pad of the plaintiff firm clinches the issue, which reads as under:- Civil Revision No.1561 of 2009(O&M) [ 9 ] “You are hereby informed that your deed of registration which was scheduled to be executed on 15.07.2005 will be executed on or before 15th September, 2005 due to delay in getting change of land use from the Government. For Mansa Land Developers sd/- Tejinder Singh, Manager The Registry was to be executed on 15th July, 2005. We were not asked to fulfill our commitment. The sellers have been very kind to accommodate us and give us extra time. The registry will now be executed on 15th of September 05 in the afternoon. For this delay, we will pay an interest @ 18% on the total amount to be paid for the period of 15th July 05 to 15th Sept.05 (i.e. till the day of registry). Sd/- 19.8.2005” Again, a notice dated 31.8.2005 (Annexure P-6) was issued by the defendants directing the plaintiff to get the sale-deed registered by 15.9.2005, failing which they would be constrained to cancel the agreement and forfeit the earnest money. Again, the sale-deed was not got registered within the stipulated period. No document is on record to reveal that the plaintiff had obtained the `Change of Land Use' or some income-tax clearance certificate during that period. All these facts were made known to the plaintiff vide reply Civil Revision No.1561 of 2009(O&M) [ 10 ] dated 17.3.2006 (Annexure P-9), stating that the plaintiff did not come present on 15.7.2005 or 15.9.2005 to get the sale-deed registered, therefore, their agreement stood cancelled and the amount of earnest money involved in the agreement stood forfeited. However, the defendants, on their own, fixed a date i.e. 24.3.2006 for the purpose of the execution of the sale-deed, which had never been intended to be accepted by the defendants. It may further be observed that even after 24.3.2006 and after the reply to the notice was received by the plaintiff, it remained silent for two years and filed the suit for specific performance of the contract at the fag end of the time when its limitation was going to expire. Admittedly, the plaintiff firm is not in possession of the suit land. It would also be worthwhile to notice that a time being specifically fixed for performance of an agreement and duly notified to the party affected, had become the essence of the contract, therefore, on the expiry of the said time, the plaintiff could not compel the defendants for performance of the agreement and he also cannot contend that he had always been ready and willing to perform the contract. His silence for about two years even after the notice also goes to show that he had never been ready and willing to perform his part of the contract. Had he been willing purchaser, then he would not have stayed behind for such a long time. It appears that on account of fall of prices, the plaintiff may have made up his mind to prolong, wait and see the big speculation. The judgment delivered in case Raj Singh vs. Inder Jeet (supra) is not applicable to the facts of the present case. The crux of the said judgment is that whenever there is proof of execution of the agreement to sell as also of Civil Revision No.1561 of 2009(O&M) [ 11 ] readiness and willingness on the part of the plaintiff, then unless the specific performance results in unfairness, specific performance has to be ordered. This judgment is not regarding the dispute relating to injunction. As regards the other judgment in case of Maharwal Khewaji Trust (supra), the same is also on different facts and, thus, not applicable in the set of facts of the present case. The other judgments, as referred to in para No.12 to 16 of the impugned judgment do not, in any way, deal with the issue with regard to grant of injunction. The Trial Court, while dealing with the issue, has already observed that since the plaintiff did not come to perform the agreement on the date fixed in the agreement or, thereafter on the day, fixed by the defendants, therefore, it cannot be said to have any prima facie case in its favour. While deciding the question of balance of convenience and irreparable injury, the Trial Court was satisfied that the defendants by virtue of their ownership over the land and holding possession thereof and to the contrary the plaintiff did not act or comply with the terms of the agreement and continued prolonging the matter till the time the limitation was going to expire, as such, the balance of convenience cannot be said to be in favour of the plaintiff. The Trial Court has also observed that since any transaction made by the defendants would suffer from the principles of lis pendens, therefore, question of irreparable injury does not arise. The Appellate Court had nothing to say contrary to the aforesaid observations. It is settled that for grant of temporary injunction all the three essential ingredients, namely; prima facie case, irreparable loss and balance Civil Revision No.1561 of 2009(O&M) [ 12 ] of convenience, must be in favour of the plaintiff, but the plaintiff in the present case appears to have established none of them and it wants to derive benefit out of his own fault. It may further be noticed that the agreement dated 4.4.2005 provided a particular date i.e. 4.7.2005 to execute the sale-deed, which date was further extended to 15.7.2005, but the plaintiff did not come forward to execute the sale-deed on that date also, but gave writing to the defendants on 16/19.8.2005 (Annexure P-5) accepting the obligation of the defendants and also showing its inability to execute the sale-deed and consequently date was got extended to 15.9.2005 afternoon. But, still he did not act by the agreement and did not attend the office of the Sub-Registrar to execute the sale-deed. The defendants had also issued notice dated 31.8.2005 (Annexure P-6) declaring their intention to cancel the agreement if the plaintiff failed to comply with the terms of the agreement on 15.9.2005 by getting the sale-deed registered. This document sent by post is ordinarily presumed to have reached the plaintiff unless otherwise proved and now, it cannot be believed that it did not reach. In response to the legal notice sent by the plaintiff, the defendants vide their reply dated 17.3.2006 (Annexure P-9) made it clear to the plaintiff that the agreement stood cancelled and the earnest money forfeited, but still, the plaintiff did not agitate for two years and remained sleeping over the issue. Had the averments of the defendants not been correct as mentioned in the reply sent through Sh.Anil Puri, Advocate, then the plaintiff would have come forward to challenge the same forthwith by having recourse to the law, but that was not so done. As such, it would be deemed that the plea set up by the defendants was prima Civil Revision No.1561 of 2009(O&M) [ 13 ] facie correct. Thus, as an upshot of the above discussion, this Court is of the opinion that the impugned order could not withstand the scrutiny of law. Hence, it cannot sustain. Consequently, the order passed by the Trial Court is liable to be restored. Resultantly, the petition is accepted, the impugned order is set aside and the order passed by the Trial Court is restored. However, it is made clear that any observations made by this Court hereinabove should not be taken as an expression of opinion on the merits of the matter, at the time of conclusion of the suit. August 25, 2009 ( A.N.JINDAL ) `gian' JUDGE