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2009 DIGILAW 789 (CAL)

Swapan Kumar Saha v. Jayanta Kumar Bose

2009-10-28

PINAKI CHANDRA GHOSE, SANKAR PRASAD MITRA

body2009
Judgment : GHOSE, J. (1.) This appeal is directed against an order and judgment dated March 12, 2008, passed by the Honble First Court when His Lordship was pleased to come to the conclusion as follows : - "The plaintiff here, on his conduct, has to remain satisfied with whatever protection the doctrine of us pendens affords it. If it appears more likely than not, that this plaintiff may not get the decree that he seeks, it follows that he may not get his injunction during the interregnum. The defendants are discharged of their obligation to abide by the commitment made not to alienate the property as recorded in the order of September 26, 2006. But the undertaking will continue to remain effective for a period of a fortnight. If within such time the plaintiff deposits with the Registrar, Original Side, a sum of Rs. 3 crores, there will be an order of injunction restraining the defendants from dealing with or disposing of the property till the disposal of the suit. If the plaintiff deposits the money, the Registrar, Original Side, will put in the same in a fixed deposit account with a nationalized bank in the vicinity of the Court. In the event, such money is not furnished within the time permitted, this petition will stand dismissed with costs assessed at 2000 GMs". (2.) The facts of the case briefly are as follows : On 2nd August, 1988 the plaintiff entered into an agreement for sale of 15 (fifteen) cottahs 8 (eight) chittacks and 35 (thirty five) sq. ft. of land along with a bungalow situated in the heart of the city at premises No.21, Mandeville Gardens, Kolkata at a consideration of Rs. 26.70 lakh. A sum of Rs. 3.70 lakh was paid as an earnest money and it was agreed that balance consideration money to be paid at the time of completion of the transaction. It was the duty of the appellant/petitioner herein to make out a marketable title to the said premises and purchase was completed within six months from the date of entering into an agreement or within the period so to be extended at the instance of the parties. It was the duty of the appellant/petitioner herein to make out a marketable title to the said premises and purchase was completed within six months from the date of entering into an agreement or within the period so to be extended at the instance of the parties. Obligation on the part of the defendants/respondents to obtain all permissions which were necessary for the transfer including the "no objection certificate" under Section 269UL of the Income Tax Act, 1961 (hereinafter referred to as the said Act). It was also agreed that such certificate is to be produced before the plaintiffs Advocates for inspection at least two weeks prior to completion of the transaction. It was also the obligation of the defendants to obtain the clearance certificate under Section 230A of the Income Tax Act, 1961 and also to be produced for inspection. Such agreement was recorded in writing on 23rd September, 1988. WBLR-45 (3.) The defendants applied before the income Tax authorities for obtaining the requisite permission. By a notice dated 22nd November, 1988, the said authority made an order of compulsory purchase of the premises under Section 269UD(1) of the Income Tax Act, 1961 and as a result whereof, writ petition was filed by the appellant on 2nd December, 1988 and the Honble Court was pleased to pass an ad interim injunction order. (4.) It is to be noted that the appellant did not take any steps in respect of the said writ petition until the matter was taken up by the Honble Court as an Old Matter and also an order was made on 7th April, 2006 setting aside the notice issued by the Income Tax authorities on 22nd November, 1988. Further, the Income Tax authorities issued a fresh notice of hearing to the parties and to reconsider the matter and pass an appropriate order. It is also to be noted that during the pendency the matter was settled by the Honble Apex Court in the case of C.B. Gautam v. Union of India reported in (1993)1 SCC 78 and subsequent thereto, the provisions of preemptive purchase of property stood deleted from the Income Tax Act. On 30th August, 2006 a No Objection Certificate was issued by the Income Tax authorities under Section 269UL (3) of the said Act. On 30th August, 2006 a No Objection Certificate was issued by the Income Tax authorities under Section 269UL (3) of the said Act. On 7th September, 2006 the appellant forwarded a draft conveyance to the respondents offering to pay the balance consideration of Rs. 23 lakhs at the time of execution of the deed. Such letter was refused by the respondents and the suit was instituted in September, 2006. An ad-interim injunction order was made. The said interim order was vacated by recording the submission made on behalf of the respondents that the respondents did not have any intention to alienate the property in question. According to the appellant, he paid the earnest deposit and took all steps in the matter necessary for prompt conclusion of the transactions between the parties. According to the appellant, even before the Income Tax authorities, the respondents participated at the hearing and it is further the case of the appellant that within a week of the permission, the appellant sent the draft deed of conveyance and despatched it to the respondents. Therefore, there is no delay in instituting the suit as submitted on behalf of the appellant which would be evident from the facts of the case. According to the appellant, the progress of the writ petition was not within the control of the appellant and further the appellant offered to tender the balance consideration promptly. . (5.) Mr. Pratap Chatterjee, learned Senior Counsel, appearing on behalf of the appellant contended that there is nothing left which should have been done by the appellant to show his eagerness to complete the transaction. He said that the Honble First Court failed to appreciate that the appellant cannot be in any way held responsible for the delay since the pendency of the writ petition was not within the control of the appellant. It is further submitted that in an application for injunction against the respondents, the Court cannot ask for more than the amount which was agreed upon between the parties and can make a condition to grant an injunction order when the appellant has shown his readiness and willingness to purchase the property in question. The question of payment of Rs. 3 crores to get an order of injunction in this case, should not have been passed by the Honble First Court by making a condition precedent. The question of payment of Rs. 3 crores to get an order of injunction in this case, should not have been passed by the Honble First Court by making a condition precedent. Hence, he submitted that such an order is illegal and should be set aside. (6.) He also relied upon a decision in the case of Muktakesi Dawn v. Haripada Mazumdar, reported in AIR 1988 Calcutta 25 where the Court held as follows: "It is true that the doctrine of lis pendens as enunciated in S. 52 of the Transfer of Property Act takes care of all pendentelite transfers; but it may not always be good enough to take fullest care of the plaintiffs interest vis-a-vis such a transfer. Where suit is one for specific performance of sale in respect of the suit property and if the defendant is not restrained from selling the property to a third party and accordingly, a third party purchases the same bona fide for value without any notice of the pending litigation and spends a huge sum of the improvement thereof or for construction thereon, the equity in his favour may intervene to persuade the Court to decline, in the exercise of its discretion, the equitable relief of specific performance to the plaintiff at the trial and to award damages only in favour of the plaintiff. It must be noted that R. 1 of O. 39 of the Code clearly provides for interim injunction restraining the alienation or sale of the suit property and if the doctrine of lis pendens as enacted in S. 52 of the Transfer of Property Act was regarded to have provided all the panacea against pendente lite transfers, the Legislature would not have provided in R. 1 for interim injunction restraining the transfer of suit property. R. 1 of O. 39, clearly demonstrates that, notwithstanding the Rule of lis pendens in S. 52 of the Transfer of Property Act, there can be occasion for the grant of injunction restraining pendentelite transfers in a fit and proper case. (1913) 17Cal LJ 427and (1865) 3 De GJ and S 63, Rel. R. 1 of O. 39, clearly demonstrates that, notwithstanding the Rule of lis pendens in S. 52 of the Transfer of Property Act, there can be occasion for the grant of injunction restraining pendentelite transfers in a fit and proper case. (1913) 17Cal LJ 427and (1865) 3 De GJ and S 63, Rel. on." (7.) He further submitted that the perceived increase in price of an immovable property during the pendency of the proceedings has already been dealt with in the cases of SVR Mudaliar v. Rajabu F. Buhari reported in AIR 1995 SC 1607 and Jai Narain Parasrampuria v. Pushpa Devi Saraf reported in (2006)7 SCC 756 : (2006)2 WBLR (SC) 1091 and that cannot be a ground for such conditional order so passed by the Court. (8.) Mr. Hirak Mitra, learned Senior Counsel, appearing on behalf of the respondents submitted that it was the duty of the appellant to take steps to conclude the proceedings but no steps have been taken even before the order was passed by the Honble Apex Court in C.B. Gautams (supra) case. Therefore, it would show that the appellant has failed to explain the delay in