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2025 DIGILAW 1543 (BOM)

Shivam Balkrushna Samvatsarkar v. Maharashtra State Farming Corporation Ltd.

2025-12-11

GAURI GODSE

body2025
ORDER : 1. This petition is filed by the original plaintiff to challenge the concurrent orders passed refusing to grant any interim injunction. The suit is filed to challenge the show-cause notice and the order passed by the respondent terminating the contract in favour of the petitioner on the ground of breach of the terms and conditions of the contract. The show-cause notice was issued on the ground of breach of terms and conditions of the contract, that the petitioner is in non-payment of the licence fees under the contract, and the execution of a subcontract in favour of the third party for monetary consideration. 2. Learned counsel for the petitioner submits that, after the contract was executed in 2016, the plaintiff was unable to cultivate the land for the first two years because the land was encroached upon and the plaintiff was required to invest substantial sums to make it cultivable. He incurred substantial expenditures to develop the land for cultivation by constructing a borewell and other necessary equipment. The petitioner denied the allegations regarding non-payment of license fees and the creation of third-party rights in its reply to the show cause notice. Since the contract was terminated, the plaintiff was compelled to file suit to challenge the show-cause notice and the termination. 3. Learned counsel for the petitioner submitted that in the said suit, an application was filed seeking an interim injunction restraining the respondent (defendant) from obstructing the plaintiff’s possession over the suit land and an injunction for protecting the crop cultivation on the suit land. Since the application for interim injunction at Exhibit 5 remained pending, the plaintiff had filed a separate application at Exhibit 74 seeking a temporary injunction. Both the applications were decided by the trial Court by a common order. He submits that the trial Court, instead of examining whether the plaintiff would be entitled to an interim injunction on the ground of the balance of convenience and a prima facie case, has recorded findings on the merits of the show cause notice and the termination order. The trial Court has not examined the loss suffered by the plaintiff in light of the show-cause notice and the termination order, although the contract period is subsisting until 31 st December 2025. 4. The trial Court has not examined the loss suffered by the plaintiff in light of the show-cause notice and the termination order, although the contract period is subsisting until 31 st December 2025. 4. Learned counsel for the petitioner also raises objections on the findings recorded by the first appellate Court on the merits of the suit and not considering the plaintiff’s case for the grant of a temporary injunction during the pendency of the suit. He submits that both the Courts have given undue importance to the alleged license agreement executed in favour of one Gaurav Patil, who has filed a suit against the petitioner and his parents. Learned counsel for the petitioner submits that the agreement in favour of Gaurav Patil was executed by his father, and the plaintiff has denied the allegation that he has created any third-party rights in respect of the suit land. He submits that even otherwise, the license agreement in favour of Gaurav Patil was only for the purpose of toiling and moiling and no third-party rights are created in his favour. Hence, there was no reason to terminate the contract in favour of the petitioner. The demand notice was issued by the corporation, which was complied with by the plaintiff, and there was no amount due and payable. 5. Hence, according to the learned counsel for the petitioner, both the Courts failed to take into consideration the prima facie case in favour of the petitioner and the balance of convenience and the irreparable loss to the petitioner during the pendency of the suit. The merits of the show cause notice and the termination order would be the subject matter of the suit. However, both Courts have refused to consider the grounds that were necessary to be examined in deciding the application for a temporary injunction during the pendency of this suit. He thus submits that, considering the huge investments made by the petitioner pursuant to the contract for implementing the joint cultivation scheme, the petitioner would be entitled to interim protection during the pendency of the suit. The petitioner’s substantive suit challenging the termination remains pending. Hence during the pendency of the suit, the petitioner would be entitled to protect his right of cultivation on the suit land. 6. The petitioner’s substantive suit challenging the termination remains pending. Hence during the pendency of the suit, the petitioner would be entitled to protect his right of cultivation on the suit land. 6. Learned counsel for the respondent submits that a detailed show cause notice was issued to the petitioner, making substantive allegations about the breach committed by the petitioner of all the terms and conditions of the contract. Despite the specific terms and conditions of the contract restricting the petitioner’s rights solely to cultivation, the petitioner carried out unauthorised construction on the suit land, created third-party rights, and defaulted in payment of the license fees. Even in the reply filed to the show-cause notice, the plaintiff, except for vague denials, has not responded to the allegations made in the show-cause notice. The copies of the pleadings in the suit filed by Gaurav Patil were produced before the Court. Considering the averments in the pleadings in the suit filed by the third party, it is clear that the petitioner has created third-party rights in breach of the terms and conditions of the contract. 7. Learned counsel for the respondent submitted that the petitioner has not produced any particulars regarding the payments of the arrears as alleged in the show cause notice. According to the respondent, even today, the petitioner is in arrears of the payments of license fees due to be paid as per the terms and conditions of the contract. He therefore submits that both the Court have rightly examined the prima facie case based on the admitted documents on record and the admitted factual aspects regarding third-party possession of the land and the construction carried out by the plaintiff. He submits that the plaintiff was awarded the contract based on a tender process. The plaintiff was never put in possession of the suit land. He was permitted to cultivate the suit land under the joint cultivation scheme with the respondent. Hence, as per the terms and conditions of the contract, the plaintiff is not entitled to claim exclusive possession over the suit land, seeking the nature of injunction as prayed in the application in the pending suit. He points out that even otherwise, the contract period of the petitioner would end on 31 st December 2025. Hence, no purpose would be served by granting any protection to the petitioner at this stage. He points out that even otherwise, the contract period of the petitioner would end on 31 st December 2025. Hence, no purpose would be served by granting any protection to the petitioner at this stage. He submits that, considering the concurrent findings recorded by both the Courts, no interference is warranted in the exercise of the discretionary jurisdiction of this Court. 8. I have carefully perused the papers of the petition. As rightly pointed out by the learned counsel for the respondent, the show cause notice alleges all breaches committed by the petitioner, including particulars of the third-party rights created by the petitioner and the construction carried out in breach of the terms and conditions of the contract. The copy of the reply to the show cause notice is a mere denial without any explanation or response to the particular allegations made in the show cause notice. The plaintiff has nowhere explained or contended that the agreement executed in favour of a third party is cancelled or terminated by the petitioner or that any steps are taken by the petitioner against the third party. Even in the plaint, the petitioner has failed to provide any explanation regarding the allegations made in the show cause notice. In fact, perusal of the pleadings reveals that even according to the plaintiff’s contention, the third party was cultivating the suit land. The plaintiff has sought to explain that the agreement executed in favour of the third party was for toiling and moiling, and he was not put in possession. However, the pleadings of the suit and the written statement in the suit filed by the third party, as reproduced by the first appellate Court in the impugned order, reveal that there is substance in the allegations made by the respondent that the petitioner has breached all the terms and conditions of the contract. 9. In the pleadings in Regular Civil Suit No.104 of 2020 as reproduced in paragraph 55 of the impugned judgment, prima facie it is seen that the petitioner has committed breach of the terms and conditions of the contract by creating third party rights. There is no material shown to this Court regarding the actual payments made to the respondent to support the submissions of the petitioner that he is not in default. There is no material shown to this Court regarding the actual payments made to the respondent to support the submissions of the petitioner that he is not in default. The proceedings of the suit filed by the third party show that, for monetary consideration, the petitioner has created third-party rights and permitted the third party to use the suit land. The terms and conditions of the contract provide for payment of the license fees and further restrict the petitioner from creating any third-party rights or carrying out any construction without permission. The terms of the contract reveal that, if the petitioner undertakes any development or improvement on the suit land, he would not be entitled to claim any equity or rights in the improvement or development made on the suit land at the time of cultivation under the terms and conditions of the contract. 10. Learned counsel for the respondent points out that the petitioner’s father did not execute the agreement in favour of the third party. However, it is executed by the petitioner himself. Hence, there would be of no substance in the arguments made on behalf of the petitioner that the agreement was executed by his father and he never attempted to create any third-party rights. A copy of the agreement is annexed by the respondent in the connected Writ Petition No.11350 of 2024. I have perused the copy of the agreement. Learned counsel for the respondent is right in pointing out that the agreement is executed by the petitioner, which would show that the petitioner has committed a breach of the terms and conditions of the contract by creating third-party rights. 11. Thus, in view of the admitted facts as discussed above, both the Courts have rightly refused to grant any temporary injunction. None of the three conditions for the grant of a temporary injunction is satisfied by the plaintiff. There is no prima facie case, nor is any balance of convenience in favour of the petitioner. When the petitioner has created third-party rights for monetary consideration, there cannot be irreparable loss to the petitioner. Since the contract was for the implementation of the joint cultivation scheme, the creation of third-party rights and non-payment of the license fees under the contract would cause irreparable loss to the respondent. When the petitioner has created third-party rights for monetary consideration, there cannot be irreparable loss to the petitioner. Since the contract was for the implementation of the joint cultivation scheme, the creation of third-party rights and non-payment of the license fees under the contract would cause irreparable loss to the respondent. The hardship is therefore caused to the respondent, and the petitioner is unable to show any monetary loss in the face of the agreement in favour of the third party for monetary consideration. 12. The scope of interference under Article 227 of the Constitution of India is well-established by the Hon’ble Apex Court in the case of Shalini Shyam Shetty and Anr. Vs. Rajendra Shankar Patil, (2010) 8 SCC 239 . The Apex Court held that the High Court can interfere in the exercise of its discretionary jurisdiction when there has been a patent perversity in the orders of the courts subordinate to it or where there has been a gross and manifest failure of justice or the basic principles of natural justice have been flouted. It is held that the power is discretionary and must be exercised sparingly, in accordance with equitable principles. 13. In the present case, no ground is made out to warrant any interference in the exercise of the discretionary jurisdiction under Article 227 of the Constitution of India. 14. The Petition is therefore rejected.