Indian City Properties Limited v. Reliance Commercial Finance Ltd.
2021-02-09
DEBANGSU BASAK
body2021
DigiLaw.ai
JUDGMENT Debangsu Basak, J. - Two suits and two interim applications have been heard analogously as the issues in the two suits are same. In CS No. 145 of 2020 the claims revolve around 6,644 square feet of area while in CS No. 146 of 2020 the claims revolve around 6,541 square feet of area lying and situate on the third, fifth and sixth floor of premises No. 163, S.P. Mukherjee Road, Kolkata. The plaintiffs have money claims against the defendant in the two suits. The plaintiffs have applied for security for their claims, receiver and injunction. 2. Learned Senior Advocate appearing for the plaintiffs has submitted that, the plaintiffs are seeking an order of injunction in the interim petitions. He has submitted that the plaintiffs are giving up the other prayers made in the petitions. 3. Learned Senior Advocate appearing for the plaintiffs has submitted that, the plaintiff No. 1 is the owner of the demised premises. The plaintiff No. 1 had let out the demised premises to the defendant under the agreements dated January 10, 2018. He has submitted that, the defendant had agreed to pay a monthly rent of Rs. 3,45,488/- to the plaintiff No. 1 in respect of 6,644 square feet in CS No. 145 of 2020. The defendant had agreed to pay Rs. 3,40,132/- for 6,541 square feet in CS No. 146 of 2020. He has submitted that, the agreements contain a lock in period. He has referred to the various clauses of the agreements. He has submitted that, the force majeure clause as the defendant is seeking to rely upon cannot be read in the manner as the defendant is seeking to do. 4. Learned Senior Advocate appearing for the plaintiffs has submitted that, the plaintiff No. 2 and the defendant entered into service agreement for Facilities, Amenities and Fit Outs on January 10, 2018 for the two areas taken on rent. Under such agreements, the plaintiff No. 2 had made fit out arrangements for the value of Rs. 94,65,740/- for 6,541 square feet in CS No. 146 of 2020. In CS No. 145 of 2020 the plaintiff No. 2 and the defendant therein had agreed to fit out arrangements for the value of Rs. 96,14,384/- for the 6,644 square feet which the defendant enjoyed . The defendant in CS No. 146 of 2020 had agreed to pay a sum of Rs.
In CS No. 145 of 2020 the plaintiff No. 2 and the defendant therein had agreed to fit out arrangements for the value of Rs. 96,14,384/- for the 6,644 square feet which the defendant enjoyed . The defendant in CS No. 146 of 2020 had agreed to pay a sum of Rs. 1,46,024/- per month for the 6,541 square feet fit out arrangement. The defendant in CS No. 145 of 2020 had agreed to pay a sum of Rs. 1,48,317/- per month for the 6,644 square feet fit out arrangement as monthly rentals for the same. 5. Learned Senior Advocate appearing for the plaintiffs has submitted that, the defendant failed and neglected to pay the lease rentals as also the amounts under the fit out agreements from December 2019. The defendant had made over possession of the demised premises on October 5, 2020. He has submitted that, the defendant in CS No. 146 of 2020 is liable to pay the plaintiffs a sum of in excess of Rs. 1,12,52,093/- and the defendant in CS No. 145 of 2020 is liable to pay the plaintiffs a sum of Rs. 89,57,896/-. 6. Learned Senior Advocate appearing for the plaintiffs has drawn the attention of the Court to the averments made in the petitions from paragraph 40 onwards. He has submitted that, unless the defendant is restrained from dealing with its assets, the defendant is likely to deal with the same in a manner so as to prejudice the plaintiffs in the execution of the eventual decree that may be passed in the two suits. 7. Learned Advocate appearing for the defendant has submitted that, the defendant terminated all the agreements on May 3, 2020. He has drawn the attention of the Court to the fact that, there are two security deposits lying with the plaintiffs on account of the defendant. According to him, no amount is due and payable by the defendant to the plaintiffs. He has referred to the various clauses of the two agreements. He has submitted that, by virtue of the force majeure clause in the agreements coupled with the fact that there are security deposits lying with the plaintiffs, the defendant is not liable to pay any amount to any of the plaintiffs. 8.
He has referred to the various clauses of the two agreements. He has submitted that, by virtue of the force majeure clause in the agreements coupled with the fact that there are security deposits lying with the plaintiffs, the defendant is not liable to pay any amount to any of the plaintiffs. 8. Since the plaintiffs have claimed money decree against the defendant, he has submitted that, no order of injunction can be passed on any asset of the defendant. In support of such contentions, he has relied upon ( Premraj Mundra v. Md. Maneck Gazi & Ors., (1951) AIR Calcutta 156) , ( Sunil Kakrania & Ors. v. M/s. Saltee Infrastructure Ltd. & Anr., (2009) AIR Calcutta 260) , ( Raman Tech. & Process Engg. Co. & Anr. v. Solanki Traders, (2008) 2 SCC 302 ) and the judgment and order dated February 7, 2020 passed in Suravee Business Pvt. Ltd. v. Chittavalsah Jute Mills Ltd. 9. As noted above, the plaintiffs have filed the two suits claiming money decree against the defendants. The plaintiff No. 1 has claimed unpaid rentals plus liquidated damages on account of the defendants acting in breach of the lease agreements dated January 10, 2018 particularly acting in breach of the lock in period. The plaintiff No. 2 has a claim as against the defendants emanating out the services agreement dated January 10, 2018. Apparently the lease agreement and the services agreements are co-terminus. The defendants have not paid lease rentals since December 2019. The defendants had vacated and made over possession of the demised premises to the plaintiff No. 1 on October 5, 2020. The defendants have claimed that the security deposits and the force majeure clause are sufficient to cover the liability, if any, of the defendants to the plaintiffs. Such claims have to be adjudicated after affording the parties opportunity to adduce evidence at trial of the suits. At this stage, the money claim of the plaintiffs cannot be wished away. 10. The lease agreements and the services agreements are interconnected and interlinked with each other. There are various clauses in the two agreements which have interplay with each other. The force majeure clause, termination clause, the lock in period, the consequences of termination prior to the expiry of the lock in period have to be considered.
10. The lease agreements and the services agreements are interconnected and interlinked with each other. There are various clauses in the two agreements which have interplay with each other. The force majeure clause, termination clause, the lock in period, the consequences of termination prior to the expiry of the lock in period have to be considered. In my view, the adjudication of the true meaning and purport of the various clauses of the two agreements should be made at the trial of the suit after affording the parties opportunity to lead evidence. At the interim stage, the fact remains that, the defendants had occupied the premises in question till October 5, 2020 when it made over possession to the plaintiffs. It is not the case of the defendants that they had paid the occupation charges subsequent to December 2019. As to whether, the plaintiffs are not entitled to any amount from the defendants for the period from January 2020 till October has to be adjudicated upon. Again such adjudication should be best left at the stage of trial of the suit. Moreover, the claim of the defendants that, by reason of the security deposit lying with the plaintiff No. 2, the defendants are not liable to pay any amount to the plaintiffs has to be adjudicated upon at the trial of the suit. At the interim stage, the plaintiffs have established that, they have a money claim as against the defendants for the period from January 20 till October 2020. They also have a money claim on diverse other accounts. These claims at this stage cannot be said with certainty to be of no consequence or that the defendants are not obliged to make any further payments in view of the security deposits lying with the plaintiff No. 2. Consequently, in my view, the plaintiffs have made out a prima facie case to go to trial. The balance of convenience and inconvenience lies in favour of the plaintiffs in granting the order of injunction as prayed for. The plaintiffs are likely to suffer by reason of the non grant of the order of injunction. 11. Premraj Mundra (supra) have dealt with situations under Order 38 Rule 5 of the Code of Civil Procedure, 1908. The plaintiffs here have not prayed for attachments before judgment under Order 38 rule 5 of the Code of Civil Procedure, 1908. 12.
The plaintiffs are likely to suffer by reason of the non grant of the order of injunction. 11. Premraj Mundra (supra) have dealt with situations under Order 38 Rule 5 of the Code of Civil Procedure, 1908. The plaintiffs here have not prayed for attachments before judgment under Order 38 rule 5 of the Code of Civil Procedure, 1908. 12. The Division Bench in Sunil Kakrania & Ors. (supra) has dealt with both Order 38 Rule 5 and Order 39 Rule 1 and 2 applications under the Code of Civil Procedure, 1908. In the facts of that case, the Division Bench has found that the plaintiff therein, not to make out a case under Order 38 Rule 5 of the Code of Civil Procedure, 1908. The Division Bench has found that, the plaintiff therein had a money claim. Therefore, the Division Bench has found that, Order 39 Rule 1 (a) and (c) and 2 of the Code of Civil Procedure, 1908 have no manner of application to the facts of that case. It has held that, a property which is not the subject matter of the suit can be injuncted under Order 39 Rule 1(b) of the Code of Civil Procedure, 1908 when, the plaintiff has alleged that, the defendant is likely to remove such property for the purpose of defrauding its creditors. In the facts of that case, the Division Bench has found that the plaintiff did not have necessary averments of such facts either in the plaint or in the petition for injunction. Therefore, the Division Bench has proceeded not to grant any order of injunction in favour of the plaintiff therein. Sunil Kakrania & Ors. (supra) should be read as an authority for the proposition that, no order of injunction can be passed in a suit for recovery of money. 13. In Suravee Business Pvt. Ltd. (supra) the Court has found that, the plaintiff was not entitled to attachment before judgment and judgment upon admission on the ground that, the defence set up by the defendant was of substance. In the facts of that case, the interim application had been filed five years after the filing of the suit.
13. In Suravee Business Pvt. Ltd. (supra) the Court has found that, the plaintiff was not entitled to attachment before judgment and judgment upon admission on the ground that, the defence set up by the defendant was of substance. In the facts of that case, the interim application had been filed five years after the filing of the suit. In view of such conduct of the plaintiff, and in view of the absence of any material to suggest that, the defendant subsequent to the filing of the suit had embarked upon a course of conduct which tantamounted to defrauding its creditors, order of injunction as prayed for therein was refused. The facts scenario obtaining in the present case are different. 14. The plaintiff in the suit for recovery of money, can obtain an order of injunction on a property belonging to the defendant which is not the subject matter of the suit upon satisfaction of the parameters for grant of injunction and the provisions of Order 39 Rule 1(b) of the Code of Civil Procedure, 1908. In other words, the Court must find that, the plaintiff has made out a prima facie case, the balance of convenience and inconvenience in granting an order of injunction lies in favour of the plaintiff and that, the plaintiff will suffer irreparable injury by non grant of the order of injunction. In addition thereto, the Court has to find that, the defendant is threatening or intending to remove or dispose of its assets with a view to defraud its creditors. While provisions of Order 39 Rule 1(a),(c) and (2) has recognised the powers of the Court to grant an order of injunction in respect of properties involved in the suit, Order 39 Rule 1(b) has empowered the Court to grant an order of injunction on a property, belonging to the defendant, which is not the subject of the lis. 15. In the facts of the present case, there are averments in the petition from paragraph 40 onwards that the defendants are likely to deal with the assets so as to defraud its creditors unless restrained. The plaintiffs have alleged that the defendants are not solvent, and that, the defendants are facing litigations on debt resolution.
15. In the facts of the present case, there are averments in the petition from paragraph 40 onwards that the defendants are likely to deal with the assets so as to defraud its creditors unless restrained. The plaintiffs have alleged that the defendants are not solvent, and that, the defendants are facing litigations on debt resolution. In paragraph 46 of the petition, the plaintiffs have alleged that, unless restrained, the defendants will deal with its properties in such a manner so as to remove such properties from the jurisdiction of the Hon'ble Court and render the decree that may be passed in favour of the plaintiffs infractuous. There are allegations that the defendants have been removing books of records from the tenancy premises without informing the plaintiffs with regard thereto. 16. In such circumstances, in my view, the plaintiffs have made out a strong prima facie case, the balance of convenience and inconvenience is in favour of the plaintiffs in granting an order of injunction and that the plaintiffs are likely to suffer irreparable injury in the event of non grant of the order of injunction as prayed for. The plaintiffs have also averred and alleged that the defendants are likely to remove its assets so as to make the same unavailable to the plaintiffs for the purpose of execution of the eventual decree that may be passed in the instant suit. 17. In such circumstances, there will be an orders of injunction in terms of prayer (h) of the petitions. 18. Ia No. GA 1 of 2020 in CS 145 of 2020 and IA No. GA 1 of 2020 in CS 146 of 2020 are disposed of accordingly without any order as to costs.