1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTON APPEAL NO.550 OF 2009 IN NOTICE OF MOTION NO.1787 OF 2009 IN SUIT NO.1266 OF 2009 Shrichand Vishandas Raheja ...Appellant (Org.Plaintiff) V/s Purshottam V.Raheja & Ors. ... Respondents (Org.Defendants) Mr.Aspy Chinoy, Senior Advocate with Mr.Janak Dwarkadas, Senior Advocate, Mr.Sharan Jagtiani and Mr.Farhan Dubash i/by M/s.Soloman & Co.for the Appellant. Mr.Ravi Kadam, Advocate General with Mr.Ashish Kamat and Mr.Vibhav Krishna i/by Juris Consillis for Respondent Nos.1 and 2. CORAM: D.K.DESHMUKH & R.G.KETKAR, JJ. DATE: 12th August, 2010. 2 P.C.:- 1. This appeal takes exception to the order dated 9.9.2009 passed in Notice of Motion no. 1787 of 2009 in Suit no.1266 of 2009. In the plaint, the Plaintiff has claimed the following reliefs:- (a) Defendant Nos.1 and 2 and their servants and agents be restrained by a permanent order and injunction of this Hon ble Court from in any manner directly or indirectly acting or holding themselves out as Attorneys or Agents of the Plaintiff or dealing with any of the properties or businesses of the Plaintiff, including property bearing Cadastral Survey No.764 of Mazgaon Division situate at 119, Chinchpokali Cross Lane, Byculla, Mumbai-400027 described in Exhibit A-3 hereto or any premises thereon or under construction thereon or any part thereof; 3 (b) Defendant nos.1 and 2 and their servants and agents be restrained by a permanent order and injunction of this Hon ble Court from in any manner directly or indirectly entering upon property bearing Cadastral Survey No. 764 of Mazgaon Division situate at 119, Chinchpokali Cross Lane, Byculla, Mumbai-400027 described in Exhibit A-3 hereto or any premises thereon or under construction thereon or any part thereof; (c) Defendant Nos.1 and 2 and their servants and agents be ordered and decreed to deliver to the Plaintiff documents listed in Exhibit U hereto and all other documents, correspondence and records belonging to the Plaintiff in the possession or power of Defendant no.1 or Defendant No.2; (d) Defendant Nos.1 and 2 be ordered and decreed to render true and faithfully accounts on the basis of willful default of their dealings as 4 the Attorneys or Agents of the Plaintiff and of amounts received and expended by them or either of them as the Attorneys or Agents of the Plaintiff and upon taking such accounts, Defendant Nos.1 and 2 be ordered and decreed jointly and severally to pay to the Plaintiff the amounts that may be found due and payable by them to the Plaintiff along with interest thereon at the rate of 18% per annum till payment or realization; (e) Defendant no.1 be ordered and restrained by a permanent order and injunction of this Hon ble Court from in any manner directly or indirectly operating or signing any Cheques on or giving any instructions relating to or withdrawing any amounts from Account No.417627508 in the joint names of the Plaintiff and Defendant No.1 with Defendant No.3; (f) Defendant no.1 be ordered and restrained by a permanent order and 5 injunction of this Hon ble Court from in any manner directly or indirectly operating or signing any cheques on or giving any instructions relating to or withdrawing any amounts from Account No.022-236586-006 in the joint names of the Plaintiff and Defendant no.1 with Defendant no.4; (g) Defendant no.1 be ordered and restrained by a permanent order and injunction of this Hon ble Court from in any manner directly or indirectly operating or signing any cheques on or giving any instructions relating to or withdrawing any amounts from Account No.20006421901 in the joint names of the Plaintiff and Defendant No.1 with Defendant No.5; (h) Defendant no.1 be ordered and decreed to pay to the Plaintiff Rs. 1,80,07,082/- as per Particulars of Claim (Exhibit V hereto) along with interest on Rs.1,74,40,000/- at the rate of 18% per annum from the date of institution of this Suit till payment 6 or realization; (i) Defendant No.1 be ordered and decreed to pay to the Plaintiff Rs. 7,15,474/- as per Particulars of Claim (Exhibit W hereto) along with interest on Rs.6,91,270/- at the rate of 18% per annum from the date of institution of this Suit till payment or realization; (j)(i) Defendant no.3 and their servants and agents be restrained by permanent order and injunction of this Hon ble Court from honouring any cheques signed by Defendant No.1 or acting on any instructions given by Defendant no.1 relating to Account No. 417627508 with Defendant No.3 or permitting any withdrawal of amounts by Defendant no.1 from Account No. 417627508 with Defendant No.3 and Defendant No.3 be ordered to delete the name of Defendant No.1 as joint account holder of the said Account No. 417627508; (ii) Defendant no.4 and their 7 servants and agents be restrained by permanent order and injunction of this Hon ble Court from honouring any cheques signed by Defendant no.1 or acting on any instructions given by Defendant no.1 relating to Account No. 002-236586-006 with Defendant no.4 or permitting any withdrawal of amounts by Defendant no.1 from Account No. 002-236586-006 with Defendant No.4 and Defendant no.4 be ordered to delete the name of Defendant no.1 as joint account holder of the said Account No. 002-236586-006; (iii) Defendant no.5 and their servants and agents be restrained by permanent order and injunction of this Hon ble Court from honouring any cheques signed by Defendant no.1 or acting on any instructions given by Defendant no.1 relating to Account no. 20006421901 with Defendant no.5 or permitting any withdrawal of amounts by Defendant no.1 from Account No. 20006421901 with Defendant no.5 and Defendant no.5 be ordered to delete the name of Defendant no.1 as joint account 8 holder of the said account No. 20006421901; The facts which are relevant and material are that the Plaintiff and Defendant no.1 are real brothers. The Plaintiff and Defendant no.1 alongwith other brothers of the Plaintiff and Defendant no.1 and the father of the Plaintiff and Defendant no.1 constituted a Joint Hindu Family. According to the Plaintiff, there was a partial partition of the joint family between Defendant no.1 and his father on 19.1.1966. There was another partial partition of joint family between the Plaintiff and his father and Defendant no.1 on 29.9.1967. According to the Plaintiff, from 1967 the Plaintiff was carrying on business on his own and was not a members of joint family alongwith Defendant no.1. 2. On 27.3.1981 by a registered conveyance, the Plaintiff purchased land in cadastral survey 9 no.764 of Mazagaon Division admeasuring 6494.36 sq.meters alongwith the building standing thereon for consideration of Rs.30,00,000/-. According to the Plaintiff, in the Income Tax Returns filed for the year 1981-1982 this transaction is disclosed. According to the Plaintiff, he got on 30.11.1981 plans for construction of building having 54 flats sanctioned from the Corporation, that building was to be constructed on a part of the Mazagaon property which is really the subject matter of this suit. The building was constructed from the year 1981 to 1987. In the year 1987, Occupation certificate of that building was obtained. That building is called as Arihant Towers . According to the Plaintiff, by the year 1993 all the flats in the building were sold by the Appellant. The sale consideration was received by the Appellant and it was duly reflected in his Income Tax Returns. According to the Plaintiff, after the Development Control 10 Regulations came into force in the year 1991, it became possible for him to develop the land on which chawls were standing on the Mazagaon property and, therefore, the Plaintiff took steps to redevelop the land occupied by the chawls by accommodating the tenants who were occupying those chawls. The Plaintiff claims that on 30.10.1993 a joint Bank account was opened in the name of Plaintiff and Defendant no.1. According to the Plaintiff that bank account was opened for carrying on banking transactions relating to the redevelopment of Mazagaon property. According to the Plaintiff, in September,1996 he secured permission for construction of two buildings on the Mazagaon land for accommodating existing tenants. According to the Plaintiff, he became seriously ill in the year 1999 and had to undergo operations as a result of which the movements of the appellant were restricted, and therefore, on 8.8.2000 a power of attorney was executed by the 11 appellant in favour of his wife and Defendant no.1 jointly or severally. The Defendant no.1 and the wife of Plaintiff by that power of attorney were empowered to manage and supervise the appellant s business affairs, they were also authorise to invest money belonging to the Plaintiff. They were also conferred power to do various acts in respect of the Appellant s property. On 10.10.2001, a joint account in the name of the Plaintiff and Defendant no.1 was opened in Hongkong Shanghai Banking Corporation. This bank account, according to the plaintiff, was opened for carrying on banking transactions in relation to the development work on the Mazgaon property. Second General Power of Attorney was executed by the Plaintiff in favour of his wife, Defendant no.1 and Defendant no.1 s son Defendant no.2 on 21.9.2005. This power of attorney, according to the Plaintiff, was also executed for the same purpose. On 1.2.2008, third joint bank account was opened in 12 the name of the Plaintiff and Defendant no.1 with the State Bank of India. In August,2008, the Plaintiff started selling flats in the newly constructed building on the Mazgaon Property. The Plaintiff claims that so far 23 agreements for sale of the flats have been entered into and all agreements have been signed either by the Plaintiff or his daughter acting under the Power of Attorney executed by the Plaintiff in her favour. According to the Plaintiff, on 24.10.2008 the Plaintiff executed a further Power of Attorney in favour of Respondent no.1 authorising him to give evidence on behalf of the Plaintiff. 3. The Plaintiff claims that Defendant no.1 suggested to the Plaintiff that he wants to invest Plaintiff s money in the joint account in Birla Sun Life Mutual Funds, but the Plaintiff did not agree. Still on 31.12.2008 the defendant no.1 invested Rs.15 lakhs from the joint account 13 in Birla Sun Life Mutual Funds. On 6.1.2009 he invested further amount of Rs.75 lakhs from the joint account in the same mutual funds and further amount of Rs.20 lakhs from the joint account in Birla Sun Life Income Plan on the same date i.e. 6.1.2009. On 17.1.2009 from the joint account, the Defendant No.1 invested Rs.50 lakhs in the Birla Sun Life Mutual Funds. According to the Plaintiff, he came to know all these unauthorised investments made by Defendant No.1, on 25.2.2009 and therefore, on 27.2.2009 an amount of Rs.50 lakhs and Rs.20 lakhs invested by Defendant no.1 were redeemed. On 2.3.2009 further amount of Rs.75 lakhs and Rs.15 lakhs unauthorisedly invested by Defendant no.1 were also redeemed. The Plaintiff claims that on 2.3.2009, Defendant no.1 unauthorisedly transferred an amount of Rs.68 lakhs from the joint account. He further transferred on 3.3.2009, an amount of Rs.80 lakhs from the joint account. 14 4. The Plaintiff, in this background, therefore on 4.3.2009 revoked all the three power of attorney executed by him in favour of Defendant no.1. The power of attorney executed in favour of Defendant no.2 was also revoked. According to the Plaintiff, even after revocation of power of attorney by the Plaintiff, the Defendant no.1 on 5.3.2009 further transferred unauthorisedly an amount of Rs.26,40,000/- from the joint account. By letter dated 9.3.2009, the Plaintiff informed the banks not to permit the Respondent no.1 to operate joint bank accounts. On 23.4.2009 a public notice was published by the Plaintiff informing about revocation of the powers of attorney by the Plaintiff. In this situation, the Plaintiff filed the suit claiming abovementioned reliefs. In that suit, Notice of Motion No.1787 of 2009 was taken out claiming temporary injunction restraining Defendant no.1, principally, from 15 acting on the basis of powers of attorney that were revoked and also restraining him from operating the joint bank accounts. That Notice of Motion was dismissed by the learned Single Judge by order dated 9.9.2009. The present appeal has been filed against that order. 5. The defence of Defendant no.1 is that the Mazgaon Property was really purchased in the name of the Plaintiff by their Father and it was a joint family property. There was a family arrangement on 30.1.1992. As a result of that family arrangement which was oral, the suit property i.e. Mazgaon property came to the share of the Defendant no.1 and their father. It was also alleged that in the oral partition dated 30.1.1992, two flats on the 15th floor of the Building Arihant Tower together with the terrace, one shop, one room and six chawls on the Mazgaon property were agreed to be allotted to Plaintiff. According to Defendant no.1, on 16 28.8.1994 their father expired and therefore, on the death of the father a part of his share in the Mazgaon property was inherited by Plaintiff. The defence of the Defendant no.1 was that he is the owner of the property, and therefore, it is he who is entitled to carry on development on the property and also entitled to sell the flats. He claims that the joint bank accounts were opened for carrying out development on the plot and for depositing sale proceeds. Thus, according to him, money in the joint bank accounts belongs to him. 6. We have heard the learned counsel for both the sides. We have also perused the record. From the record following can be taken as admitted or established positions:- (i) Plaintiff is the owner of the property, inasmuch as the conveyance of the property is in the name of the 17 Plaintiff. (ii) There is no dispute that between the period from 1981 to 1987 a building was constructed on the land (i.e. Arihant Tower) and the flats in that building were sold by the Plaintiff. (iii) It is an admitted position that Defendant No.1 has dealt with the property on the basis of powers of attorney executed by the Plaintiff. Powers of attorney have been executed by the Plaintiff subsequent to the alleged family arrangement, but in the powers of attorney there is no mention of the said family arrangement. On the contrary, powers of attorney suggests that the Plaintiff is the owner of the property and that he is not able to deal with the property because of his physical problems. 18 (iv) It is an admitted position that though the powers of attorney have been terminated by the Plaintiff, and though it is the case of the Defendant that powers of attorney were executed in his favour by the Plaintiff because he is the owner of the property, to this date, the Defendant No.1 has not instituted any proceedings challenging the revocation of the powers of attorney. (v) Though it is the case of the Defendant No.1 that he was dealing with the property as its owner and that he had become owner of the property pursuant to the family arrangement, there is no explanation given by Defendant No.1 as to why the powers of attorneys on the basis of which he was acting does not make any reference to the said family arrangement, 19 and in fact, the contents of the powers of attorney negate the existence of any such family arrangement. (vi) When notice was issued by the Plaintiff to the Defendant No.1 asking him not to act on the basis of powers of attorney and revoked the powers of attorney, the Defendant No.1 in his first reply did not refer to any such family arrangement. In the second reply he claimed that the powers of attorney could not be revoked because the powers of attorney were for consideration. He however did not mention any family arrangement. It is only in the third reply that the family arrangement was mentioned for the first time. No explanation is given by Defendant No.1 as to why he has not mentioned the family arrangement in the first and the second reply. 20 (vii) It is an admitted position that though Defendant No.1 claims that he is owner of the property since the year 1993 and that all the development on the property was carried out by him as its owner, in the Income Tax Returns filed by Defendant No.1, admittedly, there is no reference to any dealings or any expenditure made or profit earned from the said property. On the contrary, in the Income Tax Returns filed by the Plaintiff, the dealings of the suit property are duly reflected and the tax has been paid by the Plaintiff on the said transactions in relation to the said property. 7. From these admitted or established positions, it is clear that it is the Plaintiff who is the owner of the property and it is the Plaintiff who has been dealing with the property 21 as its owner. On behalf of the Defendants two circumstances were prominently pointed out to us; (1) that the Plaintiff when he purchased the property in the year 1981 did not have enough money to purchase the property, (2) that the joint bank account was opened in the year 1993 when the Plaintiff was not suffered from any physical disability. 8. So far as the first circumstance is concerned, Plaintiff has pointed out that he had borrowed the money from his father and Defendant No.1, and that his account reflects the repayment of the loan taken by him from his father and Defendant No.1. So far as the second circumstance is concerned, the explanation that is given by the Plaintiff is that due to the relationship between them the joint bank account was opened. It is true that the explanation that is given by the Plaintiff about the opening of the joint bank account in the year 1993 is 22 not entirely satisfactory, but in our opinion, following factors entitle the Plaintiff to the interim reliefs he has sought in the notice of motion :- (A) that the revocation of powers of attorney which has taken effect has not even been challenged by Defendant No.1 till date. (B) that the Defendant No.1 has not been able to explain as to why the powers of attorney does not refer to the alleged family arrangement. (C) that the Defendant No.1 has not been able to give any reason as to why, if it was his property and he was dealing with the said property as its owner, the transactions are not reflected in his Income Tax Returns but are duly 23 reflected in the Income Tax Returns of the Plaintiff. (D) that though the Defendant No.1 claims that he was dealing with the property as its owner, admittedly not a single agreement of sale in relation to the flats is signed by Defendant No.1. All the agreements have been signed either by the Plaintiff or his daughter. (E) It is the case of Defendant no.1 that he became 50% owner of the Mazgaon property after the family arrangement dated 30.1.1992, but the powers of attorney executed in his favour shows that the plaintiff is the owner of the property and the reason why the powers of attorney has been executed is the plaintiff s physical disability. The Defendant no.1 has nowhere explained why 24 he agreed to act on the basis of powers of attorney which, according to him, do not reflect the real state of affairs. It is the case of the defendant no.1 that the powers of attorney was irrevocable and was executed for consideration. The power of attorney was revoked by the Plaintiff on 4.3.2009. Though more than a year has passed, no proceeding has been instituted by Defendant no.1 challenging the revocation of powers of attorney. There is no explanation found anywhere why revocation of power of attorney has not been challenged. Admittedly, the money generated by the development of Mazgaon property was deposited in the bank accounts which are in the joint names of the plaintiff and defendant no.1. No explanation is given by Defendant no.1 as to why if the property belonged to 25 him, the amount was deposited in the joint bank account and as observed above if the money belonged to him as to why the money is not disclosed in his income tax returns. (F) It was claimed by the Plaintiff that as in the family partition two flats on the 15th floor of Arihant Towers came to his share, those two flats were sold on 14.9.1993 by the Plaintiff. The agreements were attested by Defendant no.1. The sale proceeds were received by the Plaintiff and no grievance in that regard had ever been made by Defendant no.1. We, thus, find that the plaintiff has made out a very strong prima facie case. So far as the aspect of balance of convenience is concerned, it is also in favour of the plaintiff because the 26 property stands in his name, the money generated from the development of the property is also deposited in the account which is in his name though jointly with Defendants and the agreements for transfer of the flats have been signed by him or his daughter. So far as the aspect of irreparable injury is concerned, that aspect is also in favour of grant of interim order in favour of the plaintiff because the amount for development of the property has come from the joint accounts. 9. In our opinion, therefore, the Plaintiff will have to be granted interim reliefs which he is seeking so that he can deal with his own property. In the result, appeal succeeds and is allowed. Order impugned in the appeal is set aside. 27 10. Notice of Motion No.1787 of 2009 is granted in terms of prayer clauses (a), (b) and (c). 11. At the request of learned counsel appearing for Defendant No.1, operation of this order shall stand stayed for a period of six weeks from today. However, it is clarified that the ad-interim orders which we have passed in the appeal, will continue to operate. 12. It is further clarified that this order will not prevent Defendant Nos.1 and 2 from entering the property for the purpose of visiting the shop which is owned by Defendant No.2. (D.K.DESHMUKH, J.) (R.G.KETKAR, J.)