Karan Group Builders And Developers v. Dindoshi Vrindavan C. h. s. Ltd
2019-05-02
K.K.TATED
body2019
DigiLaw.ai
JUDGMENT K. K. Tated, J. - Heard. 2. For the sake of convenience, the nomenclature of the parties will be referred to hereinafter as stated in Special Civil Suit No.2913 of 2017 i.e. appellant as plaintiff Nos.1 and 2 and respondents as defendant Nos.1 and 2. 3. By this Appeal from Order, plaintiffs are challenging the order dated 11.3.2019 passed by Bombay City Civil Court at Bombay in Notice of Motion No.3511 of 2017 in Special Civil Suit No.2913 of 2017 declining any interim relief in favour of the plaintiffs. 4. In the present proceedings, plaintiff filed Special Civil Suit No.2913 of 2017 for injunction and declaration with following prayers: a. That this Hon''ble court be pleased to pass order, judgment and decree that the redevelopment agreement dated 19/02/2011 and supplementary redevelopment agreement dated 20/05/2015 annexed at Exhibit "A Colly" are valid, subsisting and binding upon the defendant No.1 and its members. b. That this Hon''ble Court be pleased to pass order, judgment and decree that consent letter and consent for redevelopment agreement executed by all individual members of the society are valid, subsisting and binding upon the defendant No.1 and its members. c. That this Hon''ble court be pleased to declare that the notice dated 19/09/2017 annexed hereto at Exhibit "D" is null & void and further not binding upon plaintiffs in any manner of whatsoever nature. d. That this Hon''ble court be pleased to declare that if any agreement, development or redevelopment agreement, assignment deed, the relinquishment deed or any deeds and documents are executed by the defendant No.1 with the defendant No.2 or with any third person or entity after the execution of redevelopment agreement dated 19/02/2011 and supplementary redevelopment agreement dated 20/05/2015 with plaintiffs in pursuance to suit property i.e. "Survey Nos.31 and 39, CTS No.107 and 10(Part), admeasuring 700.25 Sq. Mts. Or thereabouts, together with the building No.15/A-B, known as Dindoshi Vrindavan Co-op. Hsg. Soc. Ltd. lying and being situated at Shivdham Complex, MHADA, General A.K. Vaidya Marg, Dindoshi, Malad (East), Mumbai 400097." are null and void and further not binding upon plaintiffs in any manner of whatsoever nature.
Mts. Or thereabouts, together with the building No.15/A-B, known as Dindoshi Vrindavan Co-op. Hsg. Soc. Ltd. lying and being situated at Shivdham Complex, MHADA, General A.K. Vaidya Marg, Dindoshi, Malad (East), Mumbai 400097." are null and void and further not binding upon plaintiffs in any manner of whatsoever nature. e. That this Hon''ble court be pleased to pass a permanent order of injunction restraining the defendant No.1, its agent, servant, authorized representative, committee member or any person representing through or on behalf of defendant No.1 to execute any agreement, development or redevelopment agreement, assignment deed, relinquishment deed, sale deed, joint venture agreement or any deeds and documents and creating third party rights, passing any resolution and/or handing over the possession of the suit property i.e. "Survey No.31 and 39, CTS No.107 and 10(Part), admeasuring 700.25 Sq. Mts. Or thereabouts, together with the building No.15/A-B, known as Dindoshi Vrindavan Co-op. Hsg. Soc. Ltd. lying and being situated at Shivdham Complex, MHADA, Gegneral A.K. Vaidya Marg, Dindoshi, Malad (East), Mumbai 400097." to the defendant No.2 or any third person or entity without obtaining express consent in writing from plaintiffs. In alternate to this prayer : That this Hon''ble court be pleased to pass a permanent order of injunction restraining the defendant No.2 that if any agreement, development or redevelopment agreement, assignment deed, relinquishment deed, sale deed, joint venture agreement or any deeds and documents are executed by the defendant No.1 with the defendant No.2 in respect of the suit property i.e. "Survey Nos.31 and 39, CTS No.107 and 10(Part), admeasuring 700.25 Sq. Mts. Or thereabouts, together with the building No.15/A-B, known as Dindoshi Vrindavan Co-op. Hsg. Soc. Ltd. lying and being situated at Shivdham Complex, MHADA, Gegneral A.K. Vaidya Marg, Dindoshi, Malad (East), Mumbai 400097." then the defendant No.2 should not act on the same without obtaining express consent in writing from plaintiffs.
Mts. Or thereabouts, together with the building No.15/A-B, known as Dindoshi Vrindavan Co-op. Hsg. Soc. Ltd. lying and being situated at Shivdham Complex, MHADA, Gegneral A.K. Vaidya Marg, Dindoshi, Malad (East), Mumbai 400097." then the defendant No.2 should not act on the same without obtaining express consent in writing from plaintiffs. Interim and ad interim Prayer : That pending the hearing and final disposal of the suit this Hon''ble court be pleased to pass a temporary order of injunction restraining the defendant No.1, its agent, servant, authorized representative, committee member or any person representing through or on behalf of defendant No.1 to execute any agreement, development or redevelopment agreement, assignment deed, relinquishment deed, sale deed, joint venture agreement or any deeds and documents and creating third party rights, passing any resolution and/or handing over the possession of the suit property i.e. "Survey No.31 and 39, CTS No.107 and 10(Part), admeasuring 700.25 Sq. Mts. Or thereabouts, together with the building No.15/A-B, known as Dindoshi Vrindavan Co-op. Hsg. Soc. Ltd. lying and being situated at Shivdham Complex, MHADA, General A.K. Vaidya Marg, Dindoshi, Malad (East), Mumbai 400097." to the defendant No.2 or any third person or entity without obtaining express consent in writing from plaintiffs. In alternate to this prayer : That pending the hearing and final disposal of the suit this Hon''ble court be pleased to pass a temporary order of injunction restraining the defendant No.2 that if any agreement, development or redevelopment agreement, assignment deed, relinquishment deed, sale deed, joint venture agreement or any deeds and documents are executed by the defendant No.1 with the defendant No.2 in respect of the suit property i.e. "Survey Nos.31 and 39, CTS No.107 and 10(Part), admeasuring 700.25 Sq. Mts. Or thereabouts, together with the building No.15/A-B, known as Dindoshi Vrindavan Co-op. Hsg. Soc. Ltd. lying and being situated at Shivdham Complex, MHADA, Gegneral A.K. Vaidya Marg, Dindoshi, Malad (East), Mumbai 400097." then the defendant No.2 should not act on the same without obtaining express consent in writing from plaintiffs. g. That pending the hearing and final disposal of the suit this Hon''ble court be pleased to direct the defendant No.2 to remove their sign board and reinstall the sign board of plaintiffs on the suit property i.e. "Survey Nos.31 and 39, CTS No.107 and 10(Part), admeasuring 700.25 Sq. Mts. Or thereabouts, together with the building No.15/A-B, known as Dindoshi Vrindavan Co-op. Hsg. Soc.
Mts. Or thereabouts, together with the building No.15/A-B, known as Dindoshi Vrindavan Co-op. Hsg. Soc. Ltd. lying and being situated at Shivdham Complex, MHADA, Gegneral A.K. Vaidya Marg, Dindoshi, Malad (East), Mumbai 400097." h. That pending the hearing and final disposal of the suit this Hon''ble Court be pleased to direct the defendants to produce the copy of all the deeds and documents whatever or if any executed between them before this Hon''ble court in respect of the suit property i.e. "Survey Nos.31 and 39, CTS No.107 and 10(Part), admeasuring 700.25 Sq. Mts. Or thereabouts, together with the building No.15/A-B, known as Dindoshi Vrindavan Co-op. Hsg. Soc. Ltd. lying and being situated at Shivdham Complex, MHADA, Gegneral A.K. Vaidya Marg, Dindoshi, Malad (East), Mumbai 400097." 5. In that, plaintiffs preferred Notice of Motion No.3511 of 2017 for various reliefs. As the Notice of Motion preferred by the plaintiffs stands dismissed, they preferred the present Appeal from Order. 6. The learned senior counsel for the plaintiffs submits that in the present proceeding, plaintiff No.2 entered into the redevelopment agreement dated 19.2.2011 with defendant No.1 Society. He submits that as per the said re-development agreement, parties agreed that plaintiff No.2 completed redevelopment within 18 months. He submits that thereafter supplementary re-development agreement dated 20.05.2015 entered into between defendant No.1 on one hand and plaintiff Nos.1 and 2 on the other hand. He submits that as per the said supplementary re-development agreement, it was agreed between the parties that re-development project to be completed within 24 months on same terms and conditions. He submits that as per the agreement dated 20.05.2015, plaintiffs agreed to provide additional area to the members of defendant No.1. They agreed that they will provide 340 sq.ft. carpet area as per the approved plan of the BMC in the newly constructed building to all existing 40 members of the Society. He further submits that they have to complete the project within stipulated time only after issuing additional IOD. In support of this contention, the learned counsel for the plaintiff relies on clause No.R, 2e and 6 of the said supplementary re-development agreement dated 20th May, 2015 which reads thus: "R) The Developer have also agreed to provide a flat in the form of 1 BHK having an area of 340 sq. ft.
In support of this contention, the learned counsel for the plaintiff relies on clause No.R, 2e and 6 of the said supplementary re-development agreement dated 20th May, 2015 which reads thus: "R) The Developer have also agreed to provide a flat in the form of 1 BHK having an area of 340 sq. ft. carpet area as per approved plan by BMC in the newly constructed building to all existing 40 members of the Society. The society member shall not claim any further benefit in respect of the said project and the builder/developer shall be sole entitle for the benefits which may be available as per the plan approved by BMC, MHADA and /or other authorities concerned." "2e) All the members of the said society shall be hand over peaceful vacant possession of their respective flats to the developers within stipulated period which may be decided by and between society and developer only after issuance of Full I.O.D. The said member shall be settled and/or vacate their respective flat from their licensee as earliest be possible and society shall be sole responsible to hand over peaceful vacant possession of the entire building within stipulated period and/or as earliest be possible, failing which delay to complete the redevelopment of the said building. The society members hall be sole responsible for the same. If any member of the society shall fail to handover possession of their respective flat to the building within stipulated period, the said member liable to pay of Rs.5,000/- per day from the date of stipulated period till handover possession of their flat to the builder. The said amount shall be adjusted/deducted from his monthly compensation and/or corpus fund." "6) The developer shall obtain the approval of the plans for the new building from MHADA, Municipal Corporation of Greater Mumbai being full I.O.D. with T.D.R. within 6 months from the date hereof and MHADA policy and thereafter shall submit the certified copy of the said plans to the Society. The developer shall also obtain the approval of the Municipal Corporation of Greater Mumbai, as and when the said plans are amended.
The developer shall also obtain the approval of the Municipal Corporation of Greater Mumbai, as and when the said plans are amended. The Developer shall be file an application with MHADA/BMC to amend the plan to complete the redevelopment of the society plot which may be required to obtain the OC according with law, subject to the prior written consent other member of the Society being obtained for any such amendment. The Developer shall be entitled to amend/modify the plan/s of the said building with prior written permission from the society." 7. The learned senior counsel for the plaintiffs submits that plaintiffs spent huge amount for complying certain terms and conditions of the said agreement. He submits that because of amended policy of MHADA, it remained to complete the redevelopment within time. He submits that without any fault on the part of plaintiffs, defendants terminated the agreement by notice dated 19.9.2017. Therefore, plaintiff filed the present Suit on 23.10.2017. He submits that actually MHADA''s policy came into force later on. He submits that defendant No.1 issued a termination letter before complying the terms and conditions as per re-development agreement. He submits that all these facts were not considered by the Trial Court at the time of passing impugned order declining to entertain their Notice of Motion. Hence, they preferred the present Notice of Motion. 8. The learned Senior Counsel for the plaintiffs submits that the Trial Court failed to consider the fact that the termination letter issued by defendant No.1 was premature. Therefore, there is no question of acting on the same. He further submits that Trial Court also failed to consider the fact that, plaintiff invested huge amount for re-development of the said property. Therefore, Trial Court ought to have granted injunction against the defendants. 9. On the other hand, the learned senior Counsel for Defendant No.2 / Respondent No.2 i.e. newly appointed developer vehemently opposed the present Appeal from Order. He submits that initially plaintiff No.2 entered into the M.O.U. dated 30.3.2010 with defendant No.1 Society and thereafter, executed Re-development Agreement dated 19.02.2011. He submits that in spite of the Re-development Agreement dated 19.02.2011, plaintiff failed and neglected to do anything till 2015, though the suit property was in dilapidated condition. He submits that thereafter, plaintiff Nos.1 and 2 entered into Joint Venture dated 04.04.2015 and executed supplementary re-development agreement with the defendant No.1 on 20.5.2015.
He submits that in spite of the Re-development Agreement dated 19.02.2011, plaintiff failed and neglected to do anything till 2015, though the suit property was in dilapidated condition. He submits that thereafter, plaintiff Nos.1 and 2 entered into Joint Venture dated 04.04.2015 and executed supplementary re-development agreement with the defendant No.1 on 20.5.2015. He submits that again the plaintiff failed and neglected to take any steps for carrying out re-development activities. 10. The learned senior Counsel further submits that neither the plaintiff obtained any NOC from MHADA and or sanction plan from the Corporation for carrying out re-development of the suit property. Hence, defendant No.1 issued termination letter dated 19.10.2017. Thereafter, defendant No.1 Society executed MOU with defendant No.2 on 14.11.2017 for carrying out redevelopment activities of their property. He submits that immediately thereafter, defendant No.2 obtained NOC from MHADA on 07.07.2018 by paying sum of Rs.2 crores by way of premium to MHADA. He submits that thereafter defendant No.2 obtains sanction plans for re-development in the month of July, 2018. Defendant No.1 executed registered agreement dated 14.07.2018 with defendant No.2 for re-development of their property. He submits that defendant No.2 deposited sum of Rs.2,50,00,000/- with the Society towards corpus fund. He submits that members of the Society vacated the suit premises in the month of June, 2018 and thereafter, defendant No.2 demolished entire building in the month of August, 2018 for carrying out re-development activities. He submits that defendant No.2 obtained commencement certificate for redevelopment in the month of February, 2019. He submits that defendant No.2 started paying transit accommodation charges to the member of the Society from the month of June, 2018 to the extent of Rs.13 lacs per month. He submits that in view of this subsequent development, there is no question of entertaining the present Appeal from Order filed by the plaintiff. 11. The learned senior Counsel for the defendant No.2 submits that as on today, all the members of the Society vacated their premises and same was demolished by defendant No.2 for carrying out re-development of the said building. He submits that these facts were considered by the Trial Court in paragraph 21 to 25 of the impugned order at the time of dismissing the plaintiff''s Notice of Motion. He mainly relies on paragraph 23 of the impugned order which reads thus: "23.
He submits that these facts were considered by the Trial Court in paragraph 21 to 25 of the impugned order at the time of dismissing the plaintiff''s Notice of Motion. He mainly relies on paragraph 23 of the impugned order which reads thus: "23. On the other hand, defendant No.2, i.e. the new developer has given detail chronology of the incidents as to how fast he proceeded towards completion of the re-development process. It is significant to note that MOU about re-development between defendant No.1 and defendant No.2 is dated 14.11.2017. Thereafter, defendant No.2 obtained offer letter from MHADA on 23.4.2018 and NOC was also obtained by defendant No.2 on 7.7.2018. Fresh redevelopment agreement was executed between defendant Nos.1 and 2 on 14.7.2018 and Plans were sanctioned on 13.7.2018. In addition to that, defendant No.2 also paid sum of Rs.2.5 Crores to defendant No.1 being the corpus fund. The members of defendant No.1, Society vacated their respective flats in June, 2018 and the old building was also demolished in the month of August, 2018. It is to be noted here that defendant No.2 so far has invested amount of Rs.3 to 4 Crores in the redevelopment process after its appointment as a new developer and that too within a span of less than one year. On the contrary, it is evident that plaintiffs only invested meager amount around Rs.5 Lakhs and submitted false reasons for non fulfillment of redevelopment process within the prescribed period. It is settled principle that one who seeks equity must do equity. However, on considering the overall conduct of plaintiffs and inaction on their part, they are certainly not entitled for claiming any equity in their favour." 12. The learned senior Counsel for the defendant No.2 submits that it is crystal clear from paragraph 23 of the impugned order passed by Trial Court that, defendant No.2 started development activities and therefore, there is no question of granting any relief in favour of plaintiff. 13. The learned senior Counsel for defendant No.2 submits that in any case it is the choice of the owner/member of the Society to appoint the developer to develop their property. At the most, plaintiff can claim the damages for breach of any terms and conditions of the re-development agreement, if it is proved by the documentary evidence. 14.
13. The learned senior Counsel for defendant No.2 submits that in any case it is the choice of the owner/member of the Society to appoint the developer to develop their property. At the most, plaintiff can claim the damages for breach of any terms and conditions of the re-development agreement, if it is proved by the documentary evidence. 14. The learned senior Counsel for the defendant No.2 submits that our High Court in the matter of Heritage Lifestyle and Developers Ltd. v. Cool Breeze Co-operative Housing Society Ltd. and others, (2014) 3 MhLJ 376 held that no specific relief can be granted in respect of re-development agreement. He further submits that our High Court held that, once member of the Society having lost the confidence in the developer, then there is no question of granting any specific relief in favour of the said developer. He further submits that, even in this authority, this court held that Society cannot be forced to get the development work done through the same developer if the Society is not satisfied with them. He relies on paragraph 21, 47 to 50 of this authority which reads thus: "21. Dr. Saraf learned Counsel placed reliance on the judgment of this Court in the case Gurudev Developers v. Kurla Konkan Niwas Co-op Hsg. Society, (2000) 3 MhLJ 131 in support of his submissions that no specific performance can be granted by this Court in respect of the Development Agreement. Reliance is placed on paras 5, 6 and 7 of the said judgment. Relevant portion of the said paragraphs reads thus: The counsel has further relied on O.N. Bhatnagar v. Rukibai N. Bhavnani & Ors, (1982) MhLJ 484 . In this case the Supreme court has held on page 495 para 17 (at pp. 1103-1104, para 17 of AIR) as follows: 17. In Deccan Merchants Co-operative Bank Ltd. v. M/s. Dalichand Jugraj Jain, this court had occasion to construe the meaning of the expression touching the business of a society occurring in section 91(1) of the Act. It was observed that the answer depends on the words used in the Act and that the non obstinate clause clearly ousts the jurisdiction of civil courts if the dispute falls squarely within the ambit of section 91(1) of the Act.
It was observed that the answer depends on the words used in the Act and that the non obstinate clause clearly ousts the jurisdiction of civil courts if the dispute falls squarely within the ambit of section 91(1) of the Act. The court then went to enumerate five kinds of disputes mentioned in section 91(1) first disputes touching the constitution of a society secondly disputes touching election of the office bearers of a society, thirdly dispute touching the conduct of general meetings of a society, fourthly disputes touching the management of a society and fifthly dispute touching the business of a society. In the context, it was said (at p.495). (at p. 1325 of AIR). It is clear that the word "business" in this context does not mean affairs of a society because election of office bearers conduct of general meetings and management of a society would be treated as affairs of a society. In this sub-section the word '' business '' has been used in a narrower sense and it means the actual trading or commercial or other similar business activity of the society which the society is authorised to enter into under the Act and the Rules and its bye-laws. In regard to the question whether dispute touching the assets of a society would be dispute touching the business of the society, it was observed: Ordinarily, if a society owns buildings and lets out parts of building which it does not require for its own purpose it cannot be said that letting out of those parts is a part of the business of the society. But it may be that it is the business of a society to construct and buy houses and let them out to its members. In that case letting out property may be part of its business. In my view, the observations made in the aforesaid judgments make it clear that the suit filed by the plaintiff would not be maintainable of the ground that the requisite notice as required under section 164 of the Maharashtra Co-operative Societies Act has not been served. Counsel has further submitted that even if the suit is said to be maintainable yet no relief can be granted to the plaintiff in the suit as the agreement dated 18th Jan, 1985 is merely development agreement and the same cannot be specifically performed.
Counsel has further submitted that even if the suit is said to be maintainable yet no relief can be granted to the plaintiff in the suit as the agreement dated 18th Jan, 1985 is merely development agreement and the same cannot be specifically performed. Learned counsel has relied on a judgment given in Notice of motion No. 2716 of 1987 in Suit No. 2673 of 1987. A. Nihalani v. Mr. Wilfred D''Souza and Ors. In that Notice of motion this court had the occasion to consider the nature of the agreement as to whether the same was simply a development agreement or an agreement for sale. Therein the agreement contemplated a payment of Rs. 2,85,000/- to the owners i/b defendant Nos. 1 and 2. It permitted the plaintiff to develop the property and construct the building in which of flats were to be sold on ownership basis as per the requirements and guidelines of the lessors of the land viz Salset Catholic Co-operative Housing Society Ltd. The agreement envisages that within a period of 18 months the developer should provide to the owners and tenants a temporary alternative accommodation and that the owners should also remove the person who is occupying the garage. When disputes had arisen the agreement was cancelled and the reserved rights in favour of the plaintiff to develop the property had been withdrawn. The defendants in fact after terminating the agreement entered into another agreement with another developer for the purpose of developing the property. It was argued on behalf of the society that having regard to the provisions of section 14 of the Specific Relief Act, 1963 such an agreement cannot be specifically enforced. This view was prima facie accepted. It was held: The facts show that the plaintiff was not in a position to develop within the period contemplated under the agreement. It was not an agreement to sell. The plaintiff was to develop and sell flats may be to christians and earn his profit. Therefore, in such a case if the agreement was put an end to, at the highest the remedy of the plaintiff could be by way of damages and there is no question of specific performance of this contract. It may be noted that the agreement therein was very similar to the agreement in the present case.
Therefore, in such a case if the agreement was put an end to, at the highest the remedy of the plaintiff could be by way of damages and there is no question of specific performance of this contract. It may be noted that the agreement therein was very similar to the agreement in the present case. Therefore, I am prima facie of the view that no suit for specific performance would lie in such circumstances. 6. Counsel for the defendant has brought to my notice another judgment of this court in which the same view has been reiterated (Given in notice of motion No. 76 of 1987 in Suit No. 3419 of 1986).Therein again a similar view has been taken and held that such a development agreement cannot be said to be an agreement to sell nor an agreement to lease. It has been held that it is simply an agreement to develop the property belonging to defendants on certain terms and conditions. Thus suit has been held that such an agreement cannot be specifically enforced. This judgment of the learned single Judge has been upheld in Appeal being Appeal No. 285 of 1988 decided on 7th March, 1988. The Division Bench has observes as follows: 7. In essence the suit agreement is a development agreement where the aim of the professional builder/contractor (appellant) is to make a profit by completing building and selling the flats at a profit. A breach of such an agreement can be compensated by way of damages. Merely because a temple and a guest house of devotees were also to be constructed within the plot makes no difference to the essence of the development agreement. While we applaud the pious zest of the professional builder contractor in seeking to ameliorate the spirits and material comforts of the devotees the essence of the contract still remains a building contract entered into with the aim of making profits by the expedient of constructing the building and selling the flats at a profit. We agree with the learned single Judge that damages for breach of such a contract would be the adequate remedy. Appeal dismissed. The Division Bench judgment has been followed by a single Judge Bench in Notice of Motion No. 763 of 1989 in Suit No. 844 of 1989 on February 8,1991.
We agree with the learned single Judge that damages for breach of such a contract would be the adequate remedy. Appeal dismissed. The Division Bench judgment has been followed by a single Judge Bench in Notice of Motion No. 763 of 1989 in Suit No. 844 of 1989 on February 8,1991. Therein also the parties were entered into an agreement which was very similar to the agreement in the present suit. The learned Judge after considering the characteristics of the agreement has held: The plaintiffs are professional builders/contractors and their claim in entering into the suit agreement was to make profit by completing building and selling the flats therein. Breach of such an agreement can be compensated by way of damages. No interest in land has been created by the defendants in favour of the plaintiff''s under the said agreement." Argument of the counsel is that an interest in the land had been created by the defendants in favour of the plaintiffs because the defendants had under the agreement agreed to sell to the plaintiffs the entire second floor of the building to be constructed and one shop also was rejected. The learned Judge held: I am afraid it is not possible to accept this contention. It is correct that under this clause the defendants have agreed to give and allot to the plaintiffs the premises mentioned in sub clauses (a) and (b) thereof. However, this is nothing but due to remunerating the plaintiffs for the services of construction of the building which the plaintiffs have agreed to render to the defendant sunder the said agreement. Relying on the aforesaid Division Bench judgment the learned Judge has further held: I am supported in my view to the effect that the suit for specific performance of development agreement is not maintainable by an unreported judgment of the Division Bench of this court in Appeal No. 285 of 1988 in Notice of Motion No. 76 of 1987 in Suit No. 3419 of 1996 being the judgment of Lentin and Sujata Manohar. dated 7th March, 1988." 7. In this view of the matter, I have no manner of doubt in holding that prima facie an agreement such as the one which is the subject matter of the present suit cannot be specifically enforced.
dated 7th March, 1988." 7. In this view of the matter, I have no manner of doubt in holding that prima facie an agreement such as the one which is the subject matter of the present suit cannot be specifically enforced. However, counsel for the plaintiffs has brought to my notice the decision given in Notice of motion No. 2475 of 1993 in Suit No. 3872 of 1993 dated 24th October 1996. In that case there was an agreement dated 30th November 1990 wherein the defendants had agreed to assign to the plaintiffs the development rights for developing the suit property. The plaintiffs were to develop the suit property. The defendants wanted to back out of the agreement and therefore suit for specific performance was filed. A perusal of paragraph 11 of the Judgment would show that the case put forward by the defendants therein was that there was no concluded agreement as such no specific performance could be granted. In paragraph 12 of the judgment the argument of the defendant to the effect that the agreement is merely a development agreement and therefore, the same cannot be specifically performed was noticed. A perusal of paragraph 14 shows that the court came to the conclusion that there is no termination of the agreement by the defendant. In paragraph 16 it is observed that a reading of the agreement clearly shows that the first defendant has in fact assigned the development rights of the said property in favour of the plaintiff. The agreement says that the authority and the arrangement as arrived at between the plaintiff and defendant is irrevocable. It was therefore be served that the defendant therein had entered into an agreement with the plaintiff who had taken various steps in accordance with that in pursuance of the said agreement. The plaintiffs were always ready and willing to perform their part of the contract. As a consequence of this nothing was pointed out on behalf of the first defendant which would disentitle the plaintiffs from the relief on equitable consideration. Thus it was held that the plaintiff had a prima facie case. The defendant therein was held singularly responsible for not complying with this part of the contract.
As a consequence of this nothing was pointed out on behalf of the first defendant which would disentitle the plaintiffs from the relief on equitable consideration. Thus it was held that the plaintiff had a prima facie case. The defendant therein was held singularly responsible for not complying with this part of the contract. A perusal of the said authority however shows that none of the authorities mentioned above which had been pointed out by the learned single counsel for the defendant in this case were pointed to the learned single Judge. This court is bound by the decision given by the aforesaid Division Bench." "47. A perusal of the correspondence annexed to the petition and affidavits prima facie indicates that the petitioner was not ready and willing to comply with the obligations under the said MOU, even if it is considered as concluded. The petitioner was waiting for introduction of revised and fresh policies of MHADA as according to the petitioner, existing policies were not feasible for development. Various permissions were to be obtained by the petitioner from various authorities which have not been obtained by the petitioner which were required for the purpose of commencement and completion of the properties. The members of the respondent No. 1 society are from middle class and most of the members have retired. It is an admitted position that the condition of the buildings of respondent No. 1 was dilapidated even on the date when MOU was entered into. In my prima facie view, members of the society having lost confidence in the petitioner and in view of no progress on the part of the petitioner, cannot be forced to go for redevelopment of the property through the petitioner." "48. Division bench of this Court in case of Shantilal J. Shah (supra) has held that it would be far fetched to presume that the parties contemplated that the owners would have no more than a right to continue in occupation despite the failure of the developer to carry on development and the owners, tenants and occupants should only wait, stand by and see the building in their occupation collapsing as a result of the dilapidated condition of the structure.
This Court in case of Gopi Gorwani (supra) has held that the work of redevelopment of the housing society is such that the society must have a confidence in its developer and once members of the society have expressed loss of trust, faith and confidence in the developer on account of various deviations and violations done by the developer, society cannot be forced to get the redevelopment work done through the same developer. I am respectfully bound by the judgments of this Court referred to above which in my view squarely apply to the fact of this case." "49. In view of this Court having taken a prima facie view in this judgment that the MOU was not a development agreement and no rights having been conferred under the said MOU, I do not propose to go into the issue whether specific performance of the development agreement itself can be granted by a Court or an arbitrator or whether it would require any stamping under the provisions of Maharashtra Stamp Act. I am thus not dealing with various judgments referred to and relied upon by the parties on this issue." "50. Division Bench of this Court in case of Gurudev Developers (supra) has held that even in case of a development agreement where the aim of the professional builder/contractor is to make a profit by completing building and selling the flat at profits and even if there is any breach of such agreement it can be compensated by damages. No interest in the land has been created by the defendants in favour of the developer. It is held that there was no concluded agreement and no specific performance could be granted." 15. The learned senior Counsel for the defendant No.2 also relied on the judgment of the Division Bench of this court in the matter of Shantilal J. Shah and others v. Jitendra Sanghavi and others, (2014) 1 MhLJ 193 . He submits that in this authority Division Bench of this court held that injunction should not be granted in case of redevelopment matter even if the re-developer makes out prima facie case, unless and until he complies with the terms and conditions of the agreement. Paragraph 15 of this authority reads thus: "15.
He submits that in this authority Division Bench of this court held that injunction should not be granted in case of redevelopment matter even if the re-developer makes out prima facie case, unless and until he complies with the terms and conditions of the agreement. Paragraph 15 of this authority reads thus: "15. However, even if the Appellants were held to have made out a prima facie case, it would manifestly not be proper for the Court to grant injunctive relief. A suit for specific performance is in the nature of an equitable remedy and the Court would not grant injunctive relief merely becomes a prima facie case is made out. The balance of convenience is against the grant of relief. There are sufficient circumstances in the present case which would weigh in favour of the judgment of the learned single Judge not to grant injunctive relief. The interest of the Appellants, if any, has been secured. It is in the interests of the owners, occupants and tenants that a dilapidated cessed building should be redeveloped. We, however, reiterate and clarify that no prima facie case has been made out." 16. The learned senior counsel for the defendant No.2 submits that Trial Court framed following points at the time of deciding the Notice of Motion No.3511 of 2017 which reads thus: S. No. POINTS FINDINGS 1 Do the plaintiffs prima facie establish the case for seeking injunction against defendants? In the negative. 2 Do the plaintiffs establish that they would suffer an irreparable loss if the Notice of Motion is dismissed? In the negative. 3 Whether the balance of convenience is in favour of plaintiffs? In the negative. 4 What order? As per the final order. 17. The learned senior counsel for the defendant No.2 submits that Trial Court specifically held that plaintiff failed to establish the case for seeking injunction against the defendants. Not only that Trial Court also held that plaintiff failed to establish that they will suffer irreparable loss if the Notice of Motion is dismissed. Trial Court after considering the evidence on record and documents held that balance of convenience is in favour of defendants. 18. On the basis of these submissions, the learned senior Counsel for the defendant No.2 submits that there is no substance in the present Appeal from Order and same is required to be dismissed with costs.
Trial Court after considering the evidence on record and documents held that balance of convenience is in favour of defendants. 18. On the basis of these submissions, the learned senior Counsel for the defendant No.2 submits that there is no substance in the present Appeal from Order and same is required to be dismissed with costs. He submits that in any case, it is the choice of the Society to appoint developer. At the most plaintiff can claim damages, if he proves the same by leading evidence to that effect. He further submits that if injunction is granted in favour of plaintiffs then irreparable loss and injury will be caused to the Society. He submits that as on today, entire building is demolished by them. He submits that all the occupants shifted to other place. He further submits that defendant No.2 is spending more than Rs.13 lacs per month towards payment of compensation to the occupants. Not only that, defendant No.2 spent more than Rs.5 to 7 crores for re-development of the suit property. Therefore, at this stage, there is no question of granting any interim relief in favour of plaintiff. 19. The learned counsel for the defendant No.1 also vehemently opposed the present Appeal from Order. He submits that plaintiff initially filed L.C.Suit No.2475 of 2018 for same cause of action. In that Suit, the plaintiff preferred Notice of Motion for following reliefs: "a] That Pending the hearing and final disposal of suit this Hon''ble Court be pleased to pass a temporary order of injunction by restraining the defendant Nos.3 and 4 from granting any permission/approvals to the defendant No.1 and 2 on the suit property i.e "Survey No.31 and 39, CTS No.107 and 10(Part), admeasuring 700.25 Sq. Mts. or thereabouts, together with the building No. 15/A-B, known as Dindoshi Vrindavan Co-Op Hsg. Soc. Ltd lying and being situated at Shivdham Complex, MHADA, General A.K.Vaidya Marg, Dindoshi, Malad (East), Mumbai 400097," for demolition/construction/development in any manner.
Mts. or thereabouts, together with the building No. 15/A-B, known as Dindoshi Vrindavan Co-Op Hsg. Soc. Ltd lying and being situated at Shivdham Complex, MHADA, General A.K.Vaidya Marg, Dindoshi, Malad (East), Mumbai 400097," for demolition/construction/development in any manner. b]That Pending the hearing and final disposal of suit this Hon''ble court be pleased to pass a temporary order of injunction by restraining the defendant Nos.1 and 2 from doing any advertisement for sale or any other purpose and to take/accept any bookings, receive amount, issue allotment letters, execute any documents of any nature with anyone/ purchasers/ investors or any other documents for bookings/ Sell of flats on suit property i.e. "Survey No.31 and 39, CTS No.107 and 10(Part), admeasuing 700.25 Sq.Mts. or thereabouts, together with the building No. 15/A-B, known as Dindoshi Vrindavan Co-op. Hsg. Soc. Ltd. lying and being situated at Shivdham Complex, MHADA, General A.K. Vaidya Marg, Dindoshi, Malad (East), Mumbai 400097," In any manner." 20. The learned counsel for the defendant No.1 Society submits that in that Notice of Motion in L.C.Suit No.2475 of 2018, plaintiff moved for ad interim relief but the same was rejected by Trial Court by order dated 15.9.2018. He further submits that at the time of rejecting the ad interim relief in favour of plaintiff in earlier L.C.Suit No.2475 of 2018, Trial Court observed as under: "14. Therefore taking into consideration the above facts, this Court is of a considered view that the re-development agreement and the supplementary redevelopment agreement say that a contract is determinable and if the defendant No.1 society after following the procedure ie. issuing notice of show-cause and thereafter terminating the agreement and also bringing the said fact to the knowledge of the public at large. This Court finds that defendant No.1 society had followed procedure prescribed by law. At the most plaintiffs can be entitled for damages caused. Section 14(1)(c) of the Specific Relief Act is very clear which contract are not specifically enforceable. Therefore his Court hold''s that plaintiffs apprehension is not well founded. Plaintiffs have failed to make out prima facie case at this juncture for grant of ad interim relief." "15. As far as balance of convenience is concerned, it tilts in favour to the defendant Nos.1 and 2. As far as irreparable loss is concerned, except Rs.11 lakhs, the plaintiff No.2 did not invest any amount as contended by the plaintiffs.
Plaintiffs have failed to make out prima facie case at this juncture for grant of ad interim relief." "15. As far as balance of convenience is concerned, it tilts in favour to the defendant Nos.1 and 2. As far as irreparable loss is concerned, except Rs.11 lakhs, the plaintiff No.2 did not invest any amount as contended by the plaintiffs. No particulars of expenditure have been placed by the plaintiffs before this Court. On the other hand, defendant No.2 had spent huge amount by obtaining LOI, sanctions, paying rent to the members of the defendant No.1 society and so on. So irreparable loss will caused to defendant Nos.1 and 2 not to the plaintiffs. As far as hardship is concerned, certainly first re-development agreement is of February 2011 and the plaintiffs have not shown any progress in view of the re-development agreement as well as supplementary re-development agreement. Therefore greater hardship will caused to the defendant Nos.1 and 2 and not to the plaintiffs." 21. The learned counsel for the defendant No.1 submits that as on today all the members of the Society are residing in alternate accommodation. He submits that building is already demolished in the month of August, 2018. Therefore, if any injunction is granted then irreparable loss will be caused to the Society. He further submits that our High Court in the matter of Gopi Gorwani v. Ideal Co-operative Housing Society Ltd. and other held that, if developer failed to comply the terms and conditions of the agreement within time, in that case, developer is not entitled to any relief of injunction under the Specific Relief Act. He relies on paragraph 31 of this authority which reads thus: "From the aforesaid facts it is clear that the Plaintiff has repeatedly deviated from the terms of the EOI, of which the Plaintiff has sought specific performance in the present suit. The Plaintiff has alleged a further Agreement to cover up such violation, but not sought specific performance of the purported further Agreement. The conduct of the Plaintiff also shows that the Plaintiff was at all times not ready and willing to abide by the Agreement. In such a scenario, the question of granting specific performance of the purported contract based on the EOI (at Exhibit-C to the Plaint), does not arise and therefore, the question of granting any interim relief to the Plaintiff also does not arise.
In such a scenario, the question of granting specific performance of the purported contract based on the EOI (at Exhibit-C to the Plaint), does not arise and therefore, the question of granting any interim relief to the Plaintiff also does not arise. The first Defendant has been waiting for the last about four years for redevelopment of its property. The balance of convenience is also in favour of the first Defendant and against the Plaintiff. The work of redevelopment of a Housing Society is such that a Society must have confidence in its developers. Once the members of the Society have expressed loss of trust, faith and confidence in the developer on account of various deviations and violations done by the developer, which is clear from the correspondence on record, the Society cannot be forced to get the redevelopment work done through the Plaintiff. In view thereof, the Plaintiff is not entitled to any interim relief and the Notice of Motion is disposed of as dismissed. 22. On the basis of this submissions, the learned counsel for the defendant No.1 submits that there is no question of entertaining the present Appeal from Order. He further submits that even in earlier Suit No.2475 of 2018 filed by the plaintiff, court has declined to grant any ad interim relief. Therefore, there is no question of granting any relief in the present proceeding. Hence Appeal from Order is required to be dismissed with costs. 23. Heard both the sides at length. 24. It is to be noted that in the present proceeding, defendant No.1''s building was in dilapidated condition. Hence, they decided to re-develop the same after following due process of law. Plaintiff executed development agreement dated 19.2.2011 and assured that he will complete the development of the building within 18 months. As it remained on the part of the plaintiffs to complete the re-development within time, he entered into supplementary agreement dated 20.5.1995. In spite of that, plaintiffs failed and neglected to carry out the re-development of the suit property. 25. Apart from that, defendant failed to obtain permission from MHADA for re-development. Not only that, plaintiff failed to obtain sanction plan from the Corporation to carry out redevelopment activities. This itself shows that plaintiff is not interested in carrying out re-development agreement, whereas on the other hand, defendant No.2 executed MOU dated 14.04.2017.
25. Apart from that, defendant failed to obtain permission from MHADA for re-development. Not only that, plaintiff failed to obtain sanction plan from the Corporation to carry out redevelopment activities. This itself shows that plaintiff is not interested in carrying out re-development agreement, whereas on the other hand, defendant No.2 executed MOU dated 14.04.2017. Thereafter immediately obtained NOC from MHADA on 07.07.2018 by paying premium of Rs.2 crores. Not only that, defendant No.2 also obtained sanction plan from the Corporation dated 13.07.2018. Members of the Society vacated the suit premises in the month of June 2018, on vacating the entire building, same was demolished in the month of August, 2018 for carrying out construction activities. 26. Apart from that, defendant No.2 also obtained commencement certificate in the month of February, 2019. Defendant No.2 is paying sum of Rs.13 lacs to the members of defendant No.1 towards the transit accommodation. These facts clearly show that defendant No.2 started re-development of the suit property. Apart from that, considering the defaults committed by the plaintiff from time to time, defendant No.1 Society lost their faith in the plaintiff. Once faith is lost, there is no question of allowing the said developer to re-develop the property. Thus, our High Court in the matter of Heritage Lifestyle and Developers Ltd. v. Cool Breeze Co-operative Housing Society Ltd. and others (supra) as well as Shantilal J. Shah and others v. Jitendra Sanghavi and others (supra) held that there is no question of granting any injunction in favour of developer, if he failed to comply the terms and conditions within time. It is to be noted that our High Court in the matter of Gopi Gorwani v. Ideal Co-operative Housing Society Ltd. and other (supra) held that once members of the Society have expressed loss of trust, faith and confidence in the developer on account of various violation of terms and conditions of redevelopment agreement, then there is no question of granting any injunction and or relief in favour of the developer. 27. In the case in hand, the earlier plaintiffs filed L.C.Suit No.2475 of 2018 and moved for ad interim relief. In that motion, Trial Court by its order dated 15.9.2018 declined to grant any adinterim relief. Apart from that, in the impugned order, Trial Court specifically held that plaintiff failed and neglected to comply the terms and conditions of the re-development agreement.
In that motion, Trial Court by its order dated 15.9.2018 declined to grant any adinterim relief. Apart from that, in the impugned order, Trial Court specifically held that plaintiff failed and neglected to comply the terms and conditions of the re-development agreement. Trial Court also observed that defendant No.2 i.e. new developer, started development work. 28. Considering these facts, I am of the opinion that appellants/original plaintiffs failed to make out any case to interfere with the impugned order dated 11.3.2019 passed by Trial Court in Notice of Motion No.3511 of 2017 in Special Civil Suit No.2913 of 2017. At the most, plaintiff can claim damages if it is proved. 29. In view of the above mentioned facts, following order is passed : a. Appeal from Order and Civil Application stands dismissed. b. In view of dismissal of Appeal from Order, nothing survives in the Civil Application (St.) No.10282 of 2019. c. Final hearing of S.C.Suit No.2913 of 2017 is expedited. d. No order as to costs. Order accordingly.