IN THE HIGH COURT OF GUJARAT AT AHMEDABAD APPEAL FROM ORDER No 72 of 2001 For Approval and Signature: Hon'ble MR.JUSTICE J.R.VORA ============================================================ 1. Whether Reporters of Local Papers may be allowed : YES to see the judgements? 2. To be referred to the Reporter or not? : NO 3. Whether Their Lordships wish to see the fair copy : NO of the judgement? 4. Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? 5. Whether it is to be circulated to the Civil Judge? : NO ------------------------------------------------------------- JAGANNATHJI MANDIR TRUST Versus UNION OF INDIA -------------------------------------------------------------- Appearance: MR MIHIR THAKORE with MR GM JOSHI for Appellant NOTICE NOT RECEIVED BACK for Respondent No.1. MR MANISH R BHATT for Res.No.2 (MR BB NAYAK with M.R. BHATT for Res. No. 2 in CA No. 1881/2001) MR. MAYANK VORA for Respondent No.3 MR. ND NANAVATI with MR IM BANGALI for Res. No. 4 -------------------------------------------------------------- CORAM : MR.JUSTICE J.R.VORA Date of decision: /08/2001 C.A.V.JUDGEMENT 1. This Appeal From Order is preferred by original plaintiff, being aggrieved and dissatisfied by an order passed by the City Civil Court, Court No.10, on 19th December, 2000, below Notice of Motion in Civil Suit No. 4777 of 2000 by which the learned Chamber Judge, City Civil Court, was pleased to reject the Notice of Motion for the interim relief filed by the plaintiff. 2. Brief facts of the case are that present appellant - plaintiff herein is a religious Trust and owner of suit property entered into the contract of lease with respondent No3 herein - original defendant No.3 vide registered deed dated 24.1.1961 for 99 years. There were number of terms and conditions in the above said lease deed. The defendant No.3 - respondent No.3 herein was not restricted by contractual terms to transfer his lease hold rights upon any third party. The plaintiff trust is the Jagannath Mandir Trust and one of the terms of the lease was that respondent No.3 or his assignee would not do any act which would adversely affect the religious feeling of the Hindu Community because in the rest of the land of the suit property there situated is a temple of God Hanumanji. Thereafter respondent No.3 herein lessee entered into an agreement with a third party to assign his leasehold rights in respect of suit property for the aggregate sum of Rs. 30,00,000/-. Law of Income Tax requires that such transaction would attract the provisions of Income Tax Act and the Union of India and Income Tax Department are respondents No. 1 and 2 herein i.e. Union of India and Chief Commissioner of Income Tax. Under Section 269 of the Income Tax Act, the Income Tax Department found that the transaction was improper and not realistic between respondent No.3 and third party and hence purchased the suit property from respondent No.3 lessee. Thereafter, the Income Tax Department as per provisions of Sec. 269 by public auction sold the suit property to respondent No.4. herein who is the original defendant No.4 in the suit. The consideration was fixed at Rs. 85,00,756/-. The Income Tax Department received the full consideration and the possession of the suit land was handed over to defendant No.4 i.e. respondent No.4 herein on 24.2.2000. The deed of conveyance in respect of this transaction between the Income Tax Department and respondent No.4 herein is yet to take place. On this strength, respondent No.4 intended to construct residential premises on the suit land and necessary brochures were got published by respondent No.4 herein. It is the case of the plaintiff further that from the brochures it is apparently clear that residential scheme is floated essentially for the members belonging to Muslim community. Therefore, it is apprehended by the appellant/plaintiff that if the Muslim community will occupy the residential quarters to be constructed by respondent No.4 on the suit property, then in all probabilities and possibilities, such residents shall cook non-vegetarian food in the residential premises which would attract the terms and conditions of original lease deed dated 24.1.61 because the same would hurt the religious feeling of the plaintiff and Hindu Community at large and, therefore the suit is filed for declaring the transaction between the Income Tax Department and the respondent No.4 herein to be null and void and not binding to the plaintiff. A decree is also prayed, for the vacant and peaceful possession of the suit land in favour of the plaintiff against all the defendants and declaratory decree is also sought for to the extent that putting up housing scheme by respondent No.4 on the suit land as unauthorised and against the terms of the lease and illegal and for the decree of permanent injunction against respondent No.4 restraining him from doing any further activity of construction of any nature on the suit property and from transferring the suit land to any third party in any manner whatsoever or to create charge over the suit property or to make any activity which will diminish the value of suit land. A decree for the payment of the rent is also sought for. The plaintiff appellant also filed a Notice of Motion in the above said suit and asked for following three reliefs : (a) The Hon. Court be pleased to grant temporary injunction against defendant no. (4) from doing any further activity of construction of any nature on the suit property - suit land and from transferring the suit land to anybody in any manner whatsoever or create charge over the suit property or to make any activity over the suit property which will diminish the value of the same. (b) The Commissioner may please be appointed to make complete report of the position and construction work (if any) over the suit property. (c) the costs of this application be awarded to the plaintiff from defendant no. (4) and any other appropriate remedy be awarded to the plaintiff. 3. the defendants - respondents No. 1 and 2 took the defense under Section 293 of the Income Tax Act that the suit was barred and, therefore, the Notice of Motion was incapable of being allowed in the light of statutory bar contained in Section 293 of the Income Tax Act because the acquisition of the property by Income Tax Department was under Section 269-UD which would attract Section 293 of the Income Tax Act, inter alia, respondent No.4 also contended that under the Gujarat (Prohibition of Transfer of Immovable Property and Provisions for Protection of Tenants from Eviction from Premises and Disturbed Areas Act, 1991 the power to grant interim relief under Section 4 of the said Act are to be exercised by the Deputy Collector, Ahmedabad and not by the Civil Court. The matter, according to respondent No.4 is pending with authority. A dispute also was raised that the suit property was covered under the provision of the Bombay Rent Act. It is also contended that the apprehension of the plaintiff that there would be a violation of covenant contained in the lease document dated 26.1.1961 with regard to cooking/bringing of non-vegetarian food is also unfounded without any base because the apprehension is premature for that no order or injunction can be passed in favour of the plaintiff. It was also contended that there were 17 families belong to Muslim Community residing in the suit land. It was also contended that respondent No.4 paid a huge consideration to the Income Tax Department and is a bona fide purchaser. In response to the public notice issued by the Department, and after auction purchase he has been legally and validly put into possession of the suit property and he cannot be stopped from making construction. On behalf of respondents No. 1 and 2 a stand was also taken that the auction was carried out in the year 1994 and thereafter for six years the Income Tax Department paid the annual lease rent to the plaintiff trust who has accepted the same without any demur or objections and the acquisition cannot be challenged after six years. 4. Learned City Civil Judge after hearing both the parties came to the conclusion that respondent No.4 in response to public notice and for huge consideration was put in possession of the suit property. At that time, the plaintiff trust did not raise any objection nor alleged any mala fide against respondents No. 1 and 2 in the pleadings. The learned Judge also considered that the City Deputy Collector has issued order of injunction restraining the defendant No.4 from carrying out the construction upon the suit property. The said order is dated 26th July, 2000. The learned City Civil Judge also considered that the City Civil Court cannot sit in appeal over the said order nor can decide the vires of the said order. The City Civil Court further observed that on the above facts, the notice of motion is required to be rejected. About prima facie case of the plaintiff, the City Civil Court observed that the plaintiff failed to establish prima facie case in his favour or the balance of convenience and the plaintiff has woken up after six years to challenge the act of acquisition by the Income Tax Department, which would go against the plaintiff. In the opinion of the City Civil Judge, the contention of the plaintiff that the whole property is sold to respondent No.4 is not correct. According to learned City Civil Judge all that the leasehold rights were transferred by the Income Tax Department to defendant No.4 herein. Therefore, in the opinion of the City Civil Judge, the defendant No.3 could not be prevented from exercising his right conferred upon him by the lease as well as by the transaction between him and the Income Tax Department. The apprehension on the part of plaintiff in the opinion of the City Civil Judge was without any corroborative evidence or factual basis of support and for these reasons the City Civil Court rejected the Notice of Motion of the plaintiff, but, however, while rejecting the Notice of Motion, the City Civil Court put some conditions on respondent No.4 for the unwary purchaser to the extent that before inducting any person or persons or creating any right in favour of such person, the respondent No.4 is directed by the City Civil Court to obtain all the necessary permission from all relevant authorities. A liberty is also reserved by City Civil Court for respondent No.4 to apply to the City Civil Court seeking any relief in such circumstances with regard to the disputed property. 5. Being aggrieved by the above said order, original plaintiff has preferred this Appeal. 6. Heard learned Sr. Counsel Mr. Mihir Thakore for the appellant, learned Advocate Mr. B.B.Nayak for Respondent No.2 and learned Sr. Counsel Mr. Nanavati for respondent No.4. 7. Learned Advocate Mr. Mihir Thakore has drawn the attention of this Court on the relief claimed. It is stated that in the relief claimed against respondents No. 1 and 2 in original suit, the relief in Para 14(c) of the plaint is claimed against respondent No.4 for making housing society as proposed by him. It is urged that the maintainability of the suit can be decided in the suit only and not at the interim stage. In the Notice of Motion it is contended that the relief is claimed against only respondent No.4 and not against any of the other defendants. It is contended that in any case the suit is maintainable as against defendant No.4 - respondent No.4 herein under the scope of lease deed itself. Attention of the court is also drawn to the concerned terms and conditions of the said lease deed. It is contended that the original lessee cannot confer any extra right than what is stated in the lease deed. It is also stated that the lease deed referred to above is a registered one and it could be said that the registration is notice of covenant in the lease deed. Property though purchased by the Income Tax Department u/s 269 UD, but what is acquired by the Income Tax Department is a leasehold rights only and it cannot confer more than that to respondent No.4. Attention of the Court is also drawn to Sec. 40 of the Transfer of Property Act. It is contended that Sec. 40 of the Transfer of Property Act empowers a third party i.e. appellant, herein, to the extent that for beneficial enjoyment of his property, to restrain others in the enjoyment of the property of others. In terms it is contended that for the beneficial enjoyment of its property i.e. temple of Hanumanji, lessee and assignees are restrained from doing any act which would hurt the feeling of Hindu community and the same is exemplified by a covenant that non-vegetarian food will not be brought on the property. It is urged that this is a negative covenant recognised by Sec. 40 of the Transfer of Property Act can be enforced against others restricting their enjoyment of their property. It is urged that this covenant can be enforced u/s 40 of the Transfer of Property Act not only against the original lessee but against his assignees also because whoever purchases the leasehold rights are bound by all the covenants in the lease deed which is a registered one and public have notice of it. 8. It is also vehemently contended by Mr.Thakore that rejection of plaint under O. 7 R.11 of the C.P.C. because of bar u/s 293 of the Income Tax Act as urged by the other side may not have any relevance so far as the interim relief which is asked for against respondent No.4 is concerned. The cause of action, according to Mr. Thakore, is against respondent No.4 also and the suit can still survive against respondent No.4 because the suit is also filed for the enforcement of negative covenant contained in lease deed that the lessees and assignees of the lessees are forbidden to do any act which would hurt the feeling of Hindu Community like bringing non-vegetarian food on the suit land. Learned Advocate Mr. Thakore further urged that when the present respondent No.4 is bound by the negative covenant, plaintiff - appellant has every right to obtain interim relief in his favour for restraining the breach of the above said negative conditions and to enforce the same. It is submitted that the trial court committed error in stating that there was no factual basis or apprehension to come to the conclusion that the negative covenant is not to be enforced and the apprehension of the plaintiff is not well based. It is submitted by learned counsel Mr. Thakore that in written statement filed by respondent No.4, he has admitted that he is going to float the residential scheme on the suit land. It is also submitted that the relevant authorities who approve necessary permission have been moved by the defendant No.4 for the approval of the construction. Learned Advocate Mr. Thakore further submitted that the area in which this land is situated is heavily populated by the Muslim community. It is submitted that in all probabilities and possibilities if construction is allowed and residential quarters are erected and allotted, there will be breach of condition that the non-vegetarian food is not to be cooked or brought on suit land hurting the feeling of the Hindu community. Learned Advocate Mr. Thakore submitted that these are the factors for the apprehension of the plaintiff that the very important covenant in the lease deed, as aforesaid, will be breached. From the above it is clear that the apprehension of the plaintiff appellant is very well founded. The appellant plaintiff according to Mr. Thakore, cannot be asked to wait and watch till the respondent No.4 erects the structure, till the residents cook the non-vegetarian food, so as to breach the important condition contained in the lease deed. Learned advocate Mr.Thakore further contended that when there are admitted facts stated above to substantiate the apprehension of the plaintiff, the plaintiff is entitled to file the Notice of Motion as it is filed and is entitled to obtain the relief of temporary injunction as prayed for. However, the learned Trial Judge has failed to consider this very important aspect of the matter. The parties, according to Mr. Thakore, are required to take timely action in such matters. Here in this case respondent No.4 is required to be restrained from construction when there is no construction on the suit land and if the construction is made, the right of the plaintiff will be lost and it would be difficult and impossible to enforce to legitimate negative covenant between the parties. By virtue of condition on the lease deed, respondent No.4 is bound not to cook/or bring the non-vegetarian food on the suit land as to hurt the feeling of the Hindu community. According to Mr. Thakore, this can be done at this juncture only and that too by restraining the respondent No.4 from making any residential construction which would result in breach of the negative covenant. 9. Respondent No.4 may, according to Mr. Thakore, construct any business or a commercial premises, there cannot be any objection to them, but he must be prevented from constructing a residential premises. In support, learned Advocate Mr.Thakore has drawn the attention of this Court to HALSBURY'S LAWS OF ENGLAND, Vol. 24 in paras 831 and 832 on page 435, which is under : "831 Negative and affirmative covenants and stipulations : In the case of a negative covenant or stipulation the court will usually enforce compliance by injunction without regard to the question of convenience or the amount of damage caused. Where a covenant is affirmative and of a kind which the court will enforce by a decree for specific performance, that is normally the appropriate remedy. The court will, therefore, refuse an injunction unless the affirmative covenant is in substance negative or forms part of an indivisible contract containing another covenant which is negative. 832. Threatened invasion of legal right. Where a plaintiff has established that he has a right which has been infringed and that further infringement is threatened to a material extent, he is entitled to an injunction to restrain the threatened infringement upon the ordinary principles upon which the court acts in granting injunctions. If the plaintiff's right to relief rests mainly on damage which has not been actually suffered but is likely to accrue within a reasonable time, the court will take that into consideration and grant an injunction. Therefore, although the plaintiff's legal right is not disputed, an injunction may be granted to restrain the commission of an apprehended or threatened act, on the ground that if the act is done it will violate the plaintiff's legal right, if he can show strong probability that the apprehended mischief will in fact arise. However, no one can obtain a quia time order by merely saying `timeo'. He must aver and prove that what is going on is calculated to infringe his rights. The mere fact that the defendant denies any intention of committing the act complained of is not a itself a sufficient ground for refusing relief, but it is not sufficient ground for granting an injunction that, if there is no such intention, the injunction will do the defendant no harm. An injunction will not be granted if the defendant, even though he asserts his right to do the act, not only says that he has no present intention of doing it but undertakes to give reasonable and sufficient notice before attempting to do it. An injunction may also be refused where, on the defendant being served with the writ, the plaintiff is offered and may obtain all the relief that he seeks, and the offer is one which he ought to have accepted. The court will not restrain future acts of a wrongdoer unless it is plain that they will be of a wrongful nature. Where there seems to be no probability that the act complained of will be repeated, the court will sometimes make a declaration only, with liberty to apply for an injunction if necessary. However, if the defendant claims and insists his right or gives distinct notice of his intention or threatens or intends to commit an act which, if committed, would, in the court's opinion, violate the plaintiff's right, an injunction will be granted." 10. Learned Counsel Mr. Thakore has also drawn the attention of this Court to Para 904 and 906 of HALSBURY'S LAWS OF ENGLAND, of the same volume which are under : 904. Proof of damage unnecessary. Where parties to an agreement contract, with their eyes open, that a particular thing is not to be done, proof of damage is generally not necessary in order to entitle the plaintiff to a perpetual injunction to restrain a breach. The principle applies not only to a breach by the original covenantor, but also to a breach by an assignee with notice of the covenant, but in cases where there is no privity of contract the court is probably bound to exercise its judicial discretion with regard to granting an injunction. If the construction of the contract is clear and the breach is clear, the mere circumstance of the breach affords sufficient ground for the injunction. In such a case the court has no discretion to exercise. All that it has to do is to say by way of injunction that the thing must not be done. The injunction does nothing more than give the sanction of the process of the court to that which is already the contract between the parties. In effect it is the specific performance by the court of that negative bargain which the parties made with their eyes open. 906. Covenants in leases : In a proper case the court will restrain the breach of covenants in leases, such as covenants not to carry on any business, trade or calling. The circumstance that a lessor has a right of entry for breach of covenant does not preclude him from applying for an injunction to restrain commission of the breach. In order that a reversioner may obtain an injunction to restrain the breach of restrictive covenants affecting the estate, he must bring his case within the legal principles applicable to damages and show that damage will be done to the reversion. 11. Learned Counsel Mr. Thakore relying upon the above Paras of Halsbury's Laws of England, contends that this principle is said as Quia timet action, the court can in such action grant injunction. Learned Advocate Mr. Thakore has relied upon the decision of the Supreme Court in the matter of KULDIP SINGH v. SUBHASH CHANDER JAIN, reported in AIR 2000 SC 1410, wherein the Supreme Court has made applicable the principle - Quia Times Action in the action of tort. 12. Learned Advocate Mr. Thakore has also relied upon a decision of this Court in the matter of DALPATKUMAR vs. PRAHLAD SINGH, reported in AIR (1992) 1 SCC 719, wherein it is stated that in suit seeking to set aside decree, court can grant interim injunction when the suit is based on fraud or want court's jurisdiction and that in fact the court should look to the conduct of the party, probable injuries to either party and whether plaintiff could be adequately compensated if injunction is refused. 13. Learned Counsel Mr. Thakore has further relied upon a passage from the KERR ON INJUNCTIONS, 6th Edn, 1999, which states the law on `threatened injury' which has been relied upon by the Supreme Court in the matter of KULDIP SINGH vs. SUBHASH CHANDER JAIN (supra) which reads as under : " The Court will not in general interfere until an actual nuisance has been committed; but it may, by virtue of its jurisdiction to restrain acts which, when completed, will result in a ground of action, interfere