: 1 : IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION APPEAL FROM ORDER NO.487 OF 2008 ALONGWITH CIVIL APPLICATION NO.564 OF 2008 Vilas Eknath Nandgude & Ors. .. Applicants V/s. Anjanabai Janardan Balwadkar & Ors. .. Respondents Mr. Harshad Bhadbhade for the Applicants. Mr. Shriram S. Kulkarni for the Respondents. CORAM : SMT. NISHITA MHATRE,J. RESERVED ON : 18 TH FEBRUARY, 2010. PRONOUNCED ON : 3 RD MARCH, 2010. P.C. : 1. The present Appeal from Order has been filed against the Judgment and Order dated 6th May, 2008, passed below Exhibit-5 in Special Civil Suit No.691 of 2008 by the Joint Civil Judge, Senior Division, Pune. The learned Judge has injuncted the defendant Nos.1 and 2, who are the appellants herein, from carrying out any development work and dealing with the suit property in any manner. The other defendants were also restrained from creating third party interests in the suit property. : 2 : 2. The few facts necessary for determination of the issues involved in the present dispute are as follows : 3. The plaintiffs and defendant Nos.3 to 5 are members of the Balwadkar family. They owned the suit property jointly. Admittedly there is no Deed of Partition between the members of the family. Defendant Nos.1 and 2, i.e. the appellants herein, entered into a development agreement with the plaintiffs and defendant Nos.3 to 5 on 24th February, 2006. An irrevocable power of attorney was also executed in favour of defendant Nos.1 and 2. Possession of the property was handed over to the defendant Nos.1 and 2 by the Balwadkar family. Consideration agreed between the parties was Rs.2,48,06,165/-. The plaintiffs received Rs.46,71,653/- when the agreement was executed. Post dated cheques dated 24th February, 2007 and 24th August, 2007 towards the second installment and the third installment, respectively were also received by the plaintiffs. Similarly, the defendants Nos.3 to 5 were paid Rs.23,46,006/- with : 3 : post dated cheques for the second and third installments. It appears that the post dated cheques for the second installment payable to the plaintiffs as well as defendant Nos.3 to 5 were dishonoured by the Bank. The plaintiffs, therefore, issued a notice through their Advocate to defendant Nos.1 and 2 on 20th March, 2007 informing defendant Nos.1 and 2 that the cheques were dishonoured. By this notice, the Balwadkar family terminated the agreement for development in view of the fact that the cheques issued to them for the second installment had been dishonoured. A copy of the notice was also published in the local daily newspapers declaring that the agreement between the parties had been terminated and that the power of attorney issued in favour of defendant Nos.1 and 2 had been cancelled. 4. It appears that defendant Nos.3 to 5, thereafter, settled their dispute with defendant Nos.1 and 2. They have been paid the amounts by defendant Nos.1 and 2 and, therefore, they have no grievance today against defendant Nos.1 and 2. : 4 : 5. The plaintiffs filed a Suit contending that despite the notice of termination of the agreement, defendant Nos.1 and 2 had entered into their property and were developing the same. The plaintiffs, therefore, sought an injunction against defendant Nos.1 and 2 from developing the property and creating third party rights in respect of the property. The plaintiffs contended that since defendant Nos.1 and 2 had failed to pay the amounts, as scheduled in the agreement, the plaintiffs had terminated the agreement. The plaintiffs contended that in view of the termination of the agreement, defendant Nos.1 and 2 had no right whatsoever over the suit land. Apart from this, it was contended that the agreement between the parties was a development agreement. The plaintiffs also pleaded that as there was no partition of the suit property, it was necessary to injunct defendant Nos.1 and 2 from developing the suit property. This was because defendant Nos.1 and 2 had sought amalgamation of the strips of lands which were owned by the Balwadkar family and which : 5 : were to be developed under the agreement which had been terminated by the family. 6. The defendant Nos.1 and 2 resisted the Suit and the application for temporary injunction. They contended that although the cheques for the second installment had been dishonoured, defendant Nos.1 and 2 had requested the plaintiffs to redeposit the cheques and that the amount would be paid to them. They further contended that defendant Nos.3 to 5 had done so and were, therefore, paid the entire amounts due and payable under the development agreement. The defendant Nos.1 and 2 also contended in their reply filed before the trial Court that they had invested more than Rs.9 crores in the project and if the plaintiffs were granted a temporary injunction, it would cause irreparable loss and injury to them. 7. The trial Court after hearing the parties and considering the arguments advanced before it held, that the plaintiffs were entitled to an injunction restraining the defendant Nos.1 and 2 from : 6 : developing the suit property and from creating third party interests therein. The trial Court has observed that the liability of defendant Nos.1 and 2 to pay the second installment on 24th February, 2007 was spelt out in the development agreement. The trial Court has observed that although the defendant Nos.1 and 2 claimed to have paid the entire consideration to the plaintiffs, the documents furnished by them indicated the contrary. 8. The learned Advocate appearing for defendant Nos.1 and 2, i.e. the appellants herein, has submitted that they have invested huge amounts in the project. He has also submitted that even today, the defendant Nos.1 and 2 are ready and willing to pay the entire amount of consideration due and payable. According to the learned Advocate, the development agreement was executed by the members of the Balwadkar family and, therefore, it could not be terminated only by a few members of the family. He pointed out that to show their bonafides, the defendant Nos.1 and 2 have already deposited pay orders for the consideration in the : 7 : trial Court. He drew my attention to the fact that after the cheques were dishonoured, defendant Nos.1 and 2 had requested the plaintiffs to redeposit the cheques so that they could be encashed. The learned Advocate then submitted that under the guise of the present Suit for an injunction simplicitor, the plaintiffs were seeking a declaration that the agreement had been validly terminated. He submitted that all the necessary permissions and sanctions had been obtained by defendant Nos.1 and 2 to develop the suit property for amalgamating the strips of lands owned by the Balwadkar family. The lay out which was sanctioned by the Municipal Corporation was on the basis of the entire land, according to the learned Advocate. He, therefore, submitted that the order restraining the defendant Nos.1 and 2 from developing the land which was owned by defendant Nos.3 to 5, when they had no grievance about the development, was illegal. The learned Advocate argued that the effect of the impugned order would be that although the defendant Nos.1 and 2 want to perform their part of the contract with defendant Nos.3 to 5, they cannot do : 8 : so in view of the injunction granted by the trial Court. The learned Advocate also submitted that the Suit has been filed after an inordinate delay and any injunction granted against them would cause great prejudice to the appellants. The learned Advocate further pointed out that the letter of termination of the agreement was issued on 20th March, 2007, after the cheques were dishonoured on 24th February, 2007. However, the Suit has been filed only on 8th April, 2008, by which date a substantial progress had been made in the development work, according to the learned Advocate. 9. Mr. Kulkarni appearing for the respondents, i.e. the plaintiffs, has submitted that defendant Nos.1 and 2 are seeking specific performance of the contract in a Suit filed by the plaintiffs for an injunction. He pointed out the provisions of Section 14(1)(c) of the Specific Relief Act under which no injunction can be granted to prevent the breach of a contract, the performance of which cannot be specifically enforced. He further : 9 : submitted that merely because the developer had put in a huge amount of money into the project, it would not necessarily mean that an injunction cannot be granted against the developer. According to the learned Advocate since the developers, i.e. defendant Nos.1 and 2, had themselves failed to perform their part of the obligation, they had no right to continue with the developmental work. He further submitted that the developers could not, in a Suit filed by the plaintiffs for an injunction, seek specific performance of the contract against the plaintiffs. He drew my attention to the letter terminating the agreement which was issued on 20th March, 2007 to defendant Nos.1 and 2. The learned Advocate submitted that despite this letter, the defendant Nos.1 and 2 have not thought it fit to initiate any proceedings against the plaintiffs. 10. The first ground raised to challenge the order of the trial Court is that an agreement cannot be cancelled by only one party when there are several others who have executed the agreement with the builder. This submission, in my opinion, cannot be : 10 : accepted. The plaintiffs have an independent right to the suit property. Merely because they agreed to sell their share of the suit property alongwith defendant Nos.3 to 5 to defendant Nos.1 and 2, it would not necessarily mean that they had no independent right to deal with their share of the property. Furthermore, defendant Nos.3 to 5 have chosen to encash the cheques for the second and third installments and, therefore, have exercised their rights independent of the plaintiffs’ rights. In my opinion, if all parties were expected to act together and in concert with each other, then defendant Nos.3 to 5 also could not have accepted the cheques after having subscribed to the cancellation of the agreement. 11. It may be true that defendant Nos.1 and 2 have invested huge sums of money in the present project. However, in my opinion, had they really been aggrieved by the plaintiffs conduct of not continuing with the agreement, they would certainly have initiated action against the plaintiffs. The submission that because defendant Nos.1 and 2 have : 11 : invested these amounts, no injunction should be granted against them is, therefore, untenable. 12. It is true that at some stage, defendant Nos.1 and 2 requested the plaintiffs to redeposit the cheques. However, this was about six months after the cancellation of the agreement by the plaintiffs. 13. The learned Advocate for the plaintiffs has relied on the judgment of the M. Gurudas & Ors. vs. Rasaranjan & Ors, reported in (2006) 8 SCC 367, in support of his contentions that the injunction granted by the trial Court should not be set aside by this Court. In this case, the Court has observed, after referring to various Judgments of the Supreme Court, that when other factors are evenly balanced, the Court should take such measures as would preserve the status-quo. The Supreme Court in this case has opined that when the plaintiff seeks interim relief, the Court must consider whether the plaintiff’s case is bonafide. It must also consider whether the question sought : 12 : to be tried is a serious question and not merely a triable issue. 14. The learned Advocate has also relied on the judgment of the Supreme Court in the case of Hindustan Petroleum Corporation Ltd. vs. Sriman Narayan & Anr., reported in (2002) 5 SCC 760. The Supreme Court has observed in this case in para (8), which reads as under : “8. The decision whether or not to grant an interlocutory injunction has to be taken at a time when the exercise of the legal right asserted by the plaintiff and its alleged violation are both contested and remain uncertain till they are established on evidence at the trial. The relief by way of interlocutory injunction is granted to mitigate the rise of injustice to the plaintiff during the period before which 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 : 13 : 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.” 15. In the facts of the present case, in my view, it would not be necessary to set aside the injunction granted by the trial Court as a temporary measure during the pendency of the Suit. Undoubtedly there is no Partition Deed which would indicate which lands are owned specifically by the plaintiffs or their share in the suit property. Therefore, the trial Court has rightly, in my view, granted an injunction restraining the defendant Nos.1 and 2 from developing the suit property and from creating third party interests therein. It is necessary to bear in my mind that this is not a suit for specific performance filed by one party against another. It is a suit for an injunction and a declaration where the plaintiffs have asserted their ownership of the property and have consequently sought the aforesaid relief. By granting the relief of a temporary nature to the : 14 : plaintiff, the trial Court has protected the property. 16. There can be no dispute that the defendant Nos. 1 and 2 have expended huge sums of money so far for development of the properties. They have taken the risk of developing the land although the agreement was terminated by the plaintiffs on 20th March, 2007. In the circumstances of the case, in my view, it would be appropriate to expedite the Suit. 17. The Appeal from Order is, therefore, dismissed and the injunction granted by the trial Court is confirmed. 18. The Suit shall be decided as expeditiously as possible and in any event by 31st December, 2010. 19. In view of the above, Civil Application No.564 of 2008 pending in the Appeal from Order does not survive and the same is dismissed as infructuous.