Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2009 Supreme(SC) 1411

2009(6) Supreme 210
SUPREME COURT OF INDIA
Tarun Chatterjee and R.M. Lodha, JJ.
ECE Industries Limited — Appellant
versus
S.P. Real Estate Developers P. Ltd. & Anr. — Respondents
Civil Appeal Nos. 5127-5128 of 2009
(Arising out of SLP (C) Nos. 11964-11965 of 2009)
Decided on : 06-08-2009

Advocates appeared:
R.F. Nariman, Dr. A.M. Singhvi, Sr. Advs., Akhil Sibal, Ajay bhargava, Ms. Vanita Bhargava (for M/s. Khaitan & Co.), Ananga Bhattacharya, J. Mohan Reddy, Bupender Mahendra, Aribam Guneshwar Sharma, G. Ramakrishna Prasad, Advocates.

IMPORTANT POINT
When two Courts concurrently rejected the application for injunction, it would not be open for the third Court to interfere with the said concurrent findings until and unless it is brought to the notice of the third Court that such findings are perverse or arbitrary.

Headnote:Code of Civil Procedure, 1908 – Order 39 Rule 1 and 2 read with Section 151 – Execution of development agreement between plaintiff-appellant and defendants/respondents – Suit filed by the plaintiff/appellant for recovery of possession and damages on finding that defendants/respondents were proceeding to change the nature and character of the suit property, – During pendency of suit two applications for injunction were filed by plaintiff-appellant. to restrain the defendants/respondents from alienating or transferring the suit property including the structures coming up thereon and from changing the nature and character of suit property pending disposal of the suit – Trial Court, considering the fact that substantial construction was completed, refused to grant an order of injunction in favour of the plaintiff-appellant from making any further construction in the suit property – On appeals thereagainst, High Court affirmed finding of Trial Court – Appeals thereagainst – High Court as well as the trial Court concurrently found, after going through the report of the Advocate Commissioner, that substantial construction had already been made in the suit property – If at this stage, an order of injunction was granted against the defendants/respondents from proceeding with further construction in the suit property, it would undoubtedly destroy the constructions already made by the defendants/respondents and the defendants/respondents would suffer irreparable loss and injury – That apart entire amount payable by defendants/respondents having been paid/deposited in favour of the plaintiff/appellant, no reason to pass an order of injunction against the defendants/respondents – Appeals dismissed. (Paras 19 to 26)
       Facts of the Case :
        1. A development agreement was executed between plaintiff-appellant and defendants/respondents herein in the instant case. Suit was filed by the plaintiff/appellant for recovery of possession and damages on finding that defendants/respondents were proceeding to change the nature and character of the suit Property. During pendency of suit two applications for injunction were filed by plaintiff-appellant. to restrain the defendants/respondents from alienating or transferring the suit property including the structures coming up thereon and from changing the nature and character of suit property pending disposal of the suit. Trial Court, considering the fact that substantial construction was completed, refused to grant an order of injunction in favour of the plaintiff-appellant from making any further construction in the suit property. On appeals thereagainst, High Court affirmed finding of Trial Court.
        2. Present appeals have been filed against said order of High Court.
       Findings of the Court :
        High Court as well as the trial Court concurrently found, after going through the report of the Advocate Commissioner, that substantial construction had already been made in the suit property . In view of concurrent findings of Courts below and also from the findings arrived at by the Advocate Commissioner in his report, held that substantial construction had been made. If at this stage, an order of injunction was granted against the defendants/respondents from proceeding with further construction in the suit property, it would undoubtedly destroy the constructions already made by the defendants/respondents and the defendants/respondents would suffer irreparable loss and injury. That apart entire amount payable by defendants/respondents having been paid/deposited in favour of the plaintiff/appellant, there was no reason to pass an order of injunction against the defendants/respondents. High Court was held fully justified in affirming the order of the trial Court refusing to grant any order of injunction in favour of the plaintiff/appellant. Appeals were dismissed.
       Result : Appeals dismissed.

JUDGMENT

Tarun Chatterjee, J.—

1. Leave granted.

2. These two appeals have been filed from a common order passed by the High Court of Andhra Pradesh at Hyderabad, by which the High Court had affirmed an order of the Second Additional City Civil Judge at Hyderabad, disposing of an application for injunction filed at the instance of the plaintiff-appellant on two applications for injunction in a suit for recovery of possession and damages. The plaintiff/appellant alleged in their plaint that they are the owner of 67,824.50 sq. yards of land, situated at Borabanda, Fathenagar, Ashok Marg, Hyderabad (hereinafter referred to as the suit property). The plaintiff-appellant as well as the defendants/respondents executed a Development Agreement cum Power of Attorney on 21st of September, 2007. Under the said Agreement, the defendants/respondents agreed to pay an aggregate sum of Rs. 30.50 crores in the following manner :-

i) Rs. 13.50 crores by way of non-refundable amount.

ii) Rs. 16.72 crores for utilizing the consultations, advice and services of the petitioner over the suit property along with service tax o the said amount for which invoices had been raised by the plaintiff/appellant.

iii) Rs. 28,36,525/- towards the cost of land.

3. It is the case of the plaintiff-appellant that since the defendants/respondents had acted in breach of the agreement, the same was duly terminated. Some of the breaches of the agreement in question, as alleged by the plaintiff/appellant, are as follows:-

i) The respondent No. 1 issued 12 post dated cheques for a total sum of Rs. 16.72 crores - 11 post dated cheqeus for Rs. 1.40 crores each and one post-dated cheque for a sum of Rs. 1.32 Crores.

ii) The respondent did not furnish a Bank Guarantee for the amount of Rs. 16.72 crores and also did not pay the service tax payable on the said amount.

iii) Out of the 12 post dated cheques given by the Respondent, 2 cheques were honoured, 4 of Rs. 1.4 crores each were dishonoured on presentation and balance cheques were not presented.

iv) The respondent no. 1 did not carry out construction in accordance with the sanctioned scheme.

v) The respondents entered into agreement with third parties without furnishing any details thereof.

vi) The respondents were selling dwelling units to persons who cannot be termed as members of the weaker sections of the society.”

4. Since the agreement was terminable and when it was found by the plaintiff-appellant that the defendants/respondents were proceeding to change the nature and character of the suit property, a suit has been filed by the plaintiff/appellant for recovery of possession and damages.

5. In the aforesaid suit, two applications for injunction under Order 39 Rule 1 and 2 read with Section 151 of the Code of Civil Procedure were filed by the plaintiff-appellant. In one application, the main relief that was claimed by the plaintiff-appellant was to restrain the defendants/respondents from alienating or transferring the suit property including the structures coming up thereon and in the other, for injunction over the suit property from changing the nature and character thereof pending disposal of the suit.

6. While dealing with the applications for injunction, the Second Additional City Civil Judge at Hyderabad had appointed an Advocate Commissioner to find out the extent of construction raised by the defendants/respondents in the suit property as the plaintiff-appellant sought to contend that there was no construction at all in the suit property. The Advocate Commissioner appointed by the trial Court submitted his report, which is already on record. While deciding the applications for injunction, the said report was taken into consideration by the trial Court and after hearing the learned counsel for the parties, the trial Court was prima facie satisfied that substantial construction was undertaken and completed by the defendants/respondents, which had required them to invest crores of rupees. The trial Court, consi

Click Here to Read the rest of this document

2009 Supreme(SC) 1411

2009(6) Supreme 210SUPREME COURT OF INDIATarun Chatterjee and R.M. Lodha, JJ.ECE Industries Limited — AppellantversusS.P. Real Estate Developers P. Ltd. & Anr. — RespondentsCivil Appeal Nos. 5127-5128 of 2009(Arising out of SLP (C) Nos. 11964-11965 of 2009)Decided on : 06-08-2009

IMPORTANT POINT When two Courts concurrently rejected the application for injunction, it would not be open for the third Court to interfere with the said concurrent findings until and unless it is brought to the notice of the third Court that such findings are perverse or arbitrary.

2009(6) Supreme 210
SUPREME COURT OF INDIA
Tarun Chatterjee and R.M. Lodha, JJ.
ECE Industries Limited — Appellant
versus
S.P. Real Estate Developers P. Ltd. & Anr. — Respondents
Civil Appeal Nos. 5127-5128 of 2009
(Arising out of SLP (C) Nos. 11964-11965 of 2009)
Decided on : 06-08-2009

IMPORTANT POINT
When two Courts concurrently rejected the application for injunction, it would not be open for the third Court to interfere with the said concurrent findings until and unless it is brought to the notice of the third Court that such findings are perverse or arbitrary.