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2014 DIGILAW 1073 (BOM)

Ramakant Gajanan Kadam v. Abhishek K. Rai

2014-04-28

S.B.SHUKRE

body2014
Judgment : 1. This appeal is directed against the order dated 8.7.2013 passed by Ad-hoc Civil Judge, Senior Division, Bicholim restraining the appellants from creating any third party interests in the suit property until further orders. 2. The appellants are the owners of the suit property and respondent is the original plaintiff who has filed a civil suit for specific performance of contract in respect of the suit property against the appellants. He also filed a temporary injunction application seeking a restrainment of the appellants from dealing with the suit property and creating any third party interest therein. 3. It is the case of the respondent that the appellants through their constituted attorney agreed to sell to him the suit property known as “Ticteatembavoril Borodo” also known “Tikiyachi Teb” or “Tikiyachi Temb” admeasuring 46,400 sq. mts situated at Corpal in the village Latambarcem, Bicholim,Goa more particularly described in paragraph 1 of the plaint, for a consideration of Rs.30,00,000/- and as a part consideration thereof, the respondent paid an amount of Rs.1,40,000/- to the appellants. It was agreed that the appellants would keep all original documents ready and respondent would perform his part of the agreement upon certain copies of the inventory proceedings through which the suit property has been inherited by the appellants, were handed over to the respondent. The respondent made all the arrangements for payment of full consideration amount within a short span of time in the hope that the Sale Deed would be executed in his favour, but, that was not to be. 4. The respondent further submitted that he was surprised to come across a public notice published in the local daily newspaper calling for objections from the members of public with regard to the sale of the suit property. The respondent immediately sent his objection on 1.7.2010 to the appellants. The appellants, however, instead of taking steps for execution of the sale deed, sent a legal notice to the respondent trying to rescind the agreement for alleged non-performance of the part of the contract by the respondent, though the appellants never demanded from the respondent balance consideration of the amount. They also sent a pay order for Rs.1,40,000/- to the respondent, in an attempt to refund part consideration received by the appellants. The respondent sent a notice calling upon the appellants to execute the sale deed but, in vain. They also sent a pay order for Rs.1,40,000/- to the respondent, in an attempt to refund part consideration received by the appellants. The respondent sent a notice calling upon the appellants to execute the sale deed but, in vain. The respondent, therefore, filed a suit for a specific performance of the contract stating that he was always ready and willing to perform his part of the contract. Apprehending irreparable loss, respondent also filed an application for temporary injunction for grant of injunction. 5. The appellants admitted the agreement of sale of the suit property having been executed by them. They also admitted the consideration amount and receipt of the amount of Rs.1,40,000/- as a part consideration. They submitted that the respondent, however, failed to keep his promise to make balance payment of Rs.28,60,000/-by mid December, 2009. The appellants waited for the respondent to make the payment of the balance amount and as he did not make the payment, the appellants revoked the power of attorney given to their constituted attorney and by sending a notice on 25.11.2010 together with pay order for the amount of Rs.1,40,000/- , terminated the agreement. The said amount of Rs.1,40,000/- was accepted by the respondent. The appellants, therefore, submitted that the agreement itself having been determined, there was no cause of action for filing of suit for specific performance. They also submitted that the respondent never intended to make payment of balance amount of consideration and only indulged in delaying tactics. 6. After hearing both the sides, learned Ad-hoc Civil Judge, Senior Division, found that the respondent established the existence of prima facie case and also the factor of balance of convenience and causing of irreparable loss as going in his favour and thus granting the application, learned Civil Judge, restrained the appellants from creating any third party interests in the suit property until further orders. This order was passed on 8.7.2013 and it is the same order which is impugned herein. 7. I have heard learned counsel for the appellants and for the respondent. I have gone through the impugned order and paper book, with their assistance. Now, the only point which arises for my determination is:- Whether the discretion exercised by lower Court is arbitrary and unreasonable? 8. 7. I have heard learned counsel for the appellants and for the respondent. I have gone through the impugned order and paper book, with their assistance. Now, the only point which arises for my determination is:- Whether the discretion exercised by lower Court is arbitrary and unreasonable? 8. Learned counsel for the appellants has submitted that when the agreement itself was determined there was no question of the respondent claiming any interest in the suit property, with whatever right he had having been extinguished after termination of the agreement. He submits that termination of the agreement was accepted by the respondent when he did not return the pay order dated 24.11.2010 sent to him by the appellants and received by him. He also submits that there is no dispute about the receipt of the pay order, as in the plaint itself, the respondent has made a reference to it. He further submits that if the respondent wanted to keep alive the agreement for sale of suit property, he would have returned the pay order and since he neither returned it nor stated anything about its encashment in the plaint, it can be safely inferred that the respondent has accepted termination of the agreement. Therefore, no temporary injunction order should have been passed by the learned Civil Judge, so submits the learned counsel for the appellants. 9. Learned counsel for the respondent, on the other hand, submits that even though the respondent has not mentioned in his plaint anything about the return of pay order, his intention to keep alive the agreement for sale is discernible from the reply dated 18.1.2011 sent by him to the legal notice dated 25.11.2010 of the appellants. By this notice, the respondent in no uncertain terms called upon the appellants to perform their part of the agreement within a period of 15 days from the receipt of the reply. This obviously implies that the respondent has not encashed the pay order. He also submits that the notice dated 25.11.2010 allegedly terminating the agreement was itself illegal as it was sent without first calling upon the respondent to pay the remaining amount of the consideration. He submits that a bilateral agreement cannot be terminated in a one sided manner especially when there is no breach of any of the terms of the contract by a party. He submits that a bilateral agreement cannot be terminated in a one sided manner especially when there is no breach of any of the terms of the contract by a party. Therefore, according to him, the agreement for sale subsists even today and it gives rise to legally enforceable rights and obligations of the parties thereto. 10. After going through the impugned order and also the documents contained in the paper book, I find, great substance in the argument canvassed on behalf of learned counsel for the respondent and no merit in the argument of learned counsel for the appellants. 11. There is no dispute about the reply dated 18.1.2011 sent by the respondent to the notice of the appellants dated 25.11.2010. By this reply, the respondent called upon the appellants to perform their part of the contract within the period specified therein and this fact itself prima facie indicated about the intention of the respondent to treat the agreement for sale as subsisting. It is true that the respondent has not specifically mentioned in the plaint about the return of the pay order or its encashment but that would not be sufficient, at this stage, to conclude that the pay order must have been encashed by the respondent. The encashment of pay order is material for determining as to whether or not the termination of the agreement has been accepted by the respondent. But, as I said earlier, silence of the respondent about encashment of the pay order or even its return to the appellants would not be a determinative factor for conclusively holding that the amount of the pay order has been accepted by the respondent so as to signify his consent to the termination of the agreement. Suffice it to say here that even the appellants could have thrown light on this fact by obtaining information from the concerned banker about encashment of the pay order. But, they are also maintaining silence on it. It is, therefore, something which would require consideration on merits of the case after the parties have adduced evidence. At this stage, one has to go by the prima facie worth of the material produced on record by both sides. This material, prima facie, indicates that the respondent has not treated the agreement as validly terminated and for him the agreement still subsists. 12. At this stage, one has to go by the prima facie worth of the material produced on record by both sides. This material, prima facie, indicates that the respondent has not treated the agreement as validly terminated and for him the agreement still subsists. 12. There is also not doubt at this stage of this case that the notice dated 25.11.2010 has been sent to the respondent even without calling upon the respondent to perform his part of the contract which was relating to the payment of balance consideration of the amount. The agreement for sale was evidenced by affidavits dated 21.8.2009. The affidavits do not refer to any time as agreed between the parties by which the balance amount of consideration was to be paid by the respondent. Therefore, prima facie, expectation of the respondent to receive a specific demand for payment of balance consideration amount from the appellants cannot be said to be unreasonable or entirely going beyond the terms agreed between the parties. 13. In the light of such nature of material available on record, the learned Civil judge has found that the respondent has a right in respect of the agreement for sale about which he has made out a debatable case before the Court giving rise to the existence of prima facie case in his favour. This finding, therefore, cannot be seen to be perverse or arbitrary or unreasonable. 14. Learned counsel for the appellants has submitted that learned Civil Judge has committed material illegality by ignoring the settled principles of law and provisions of Section 14(1)(c) of the Specific Relief Act, 1963. He submits that specific performance of the contract, under the said provisions, cannot be granted when the contract is determinable in nature. In support he relies upon the judgment of the Hon'ble Apex Court in the case of Indian Oil Corporation Ltd Vs. Amritsar Gas Service and others, (1991) 1 SCC 533 . With due respect, I must say, said case cannot assist the appellants as in the said case there was a clause in the distributorship agreement between the Indian Oil Corporation and Amritsar Gas Service providing for termination of the agreement by the Corporation forthwith on the happening of some specified events. This clause made the distributorship agreement as determinable in nature, thereby attracting the provisions of Section 14(1)(c). This clause made the distributorship agreement as determinable in nature, thereby attracting the provisions of Section 14(1)(c). I could not, at this stage of the suit, find out any such termination clause in the agreement between the appellants and the respondent, nor any such clause has been pointed out to me by learned counsel for the appellants. 15. Learned counsel for the appellants has further submitted that it was necessary for the learned Civil Judge to consider the existence of the balance of convenience in favour of the respondent and also the factor of causing of irreparable loss to the respondent by applying settled principles of law and the learned Civil Judge has committed a serious error on this count also. He further submits that the appellants are in possession of the suit property and by restraining them from creating any third party right therein, the appellants have been denied their right to enjoy the suit property even in a situation wherein there is no agreement for sale of suit property in subsistence, thereby causing inconvenience as well as irreparable loss to the appellants. 16. On the other hand, the learned counsel for the respondent submits that once it is found that prima facie the respondent has some right in respect of the suit property, creation of any third party rights therein, would not only disturb the balance of convenience but lead to possibility of causing of loss to the appellants which cannot be compensated by money. 17. I have already found that no perversity could be seen in the finding recorded by the learned Civil Judge as regards the existence of the prima facie case in favour of the appellants. Therefore, learned counsel for the respondent is right when he submits that balance of convenience would require that no further third party rights are created in the suit property as creation of any third party rights in such a situation is always beset with the problem of creation of the complications and multiplicity of proceedings which in turn may also cause loss to the plaintiff not reparable in terms of money. 18. In view of the above, I am of the opinion that the discretion, exercised in this regard by the learned Civil Judge is consistent with the well settled principles of law. 18. In view of the above, I am of the opinion that the discretion, exercised in this regard by the learned Civil Judge is consistent with the well settled principles of law. Besides, this is an appeal against discretion and therefore, as held in the case of Wander Ltd and another Vs. Antox India P. Ltd, 1990(suppl) SCC 727, is an appeal on principle. The appellate Court cannot, therefore, reassesses the material and seek to reach a conclusion different from the one reached by the Court below solely on the ground that if it had considered the matter at the trial stage, it would have come to a contrary conclusion. It is well settled law that if the discretion has been exercised by the trial Court reasonably and in a judicial manner, the fact that the appellate Court would have taken different view would not justify interference with the discretion exercised by the trial Court. 19. In this view of the matter, I find no merit in this appeal. It deserves to be dismissed. Appeal stands dismissed. In the circumstances, there shall be no order as to costs.