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SUPREME COURT OF INDIA
Ashok Bhushan, M.R. Shah, JJ.
Pawan Kumar Arya and others – Appellant
Versus
Ravi Kumar Arya and others – Respondent
Civil Appeal Nos. 945-946 of 2020; (Arising from SLP(C) Nos. 9971-72 of 2018)
Decided on : 02-03-2020
Family settlement - Treated differently from any other formal commercial settlement - Parties arriving at settlement in respect of all properties - Flats in question forming a part of the properties and the settlement - Consent terms deciding allotment of flats, 8 to PA group and 7 to RA group - Builder required to issue allotment letters and RA group required to countersign them - Consent terms also requiring submission of supplementary consent settlement in respect of other properties - Supplementary settlement not made - Ra group in protest not countersigning allotment letters - PA group filing execution petition - Consent terms were arrived at to give quietus to family dispute for which supplementary settlement was required - Consent decree cannot be executed in part - However RA group holding all 15 flats despite allotment of 8 flats to PA group which not availing any benefit - RA group directed to countersign allotment letters as per consent terms but PA group restrained to alienate the flats unless supplementary settlement is filed. (Para 8 and 9)
Facts of the case:
The original defendant no.7 - M.P. Recycling Company was jointly held by PA Group and RA Group with each credit or holding 50% of its shareholding. That M.P. Recycling held 25% of shareholding in Kash Foods. That Kash Foods owned a plot of land at Worli admeasuring about 4134.27 sq, meters. That 25% of the shareholding in Kash Foods was purchased by M.P. Recycling and the remaining 75% of the shareholding in Kash Foods was bought by RA Group in 2011 in their individual capacities.
A portion of the assets of Kash Foods was transferred to original defendant nos. 3 & 4 that are the members of the RA Group. A development agreement was executed between Omkar Builders - original defendant no. 10, Kash Foods, original defendant no. 8 and defendant nos. 3 and 4, which was challenged by the plaintiffs in the suit.
During the pendency of the suit, the suit came to be settled and the aforesaid suit came to be disposed of in accordance of the consent terms.
In view of the refusal on the part of defendant nos. 1 to 6 - RA Group to abide by the consent terms and counter-sign the letter of allotment as per 'Annexure E', the plaintiffs initiated the proceedings for execution of the consent decree. The execution application came to be rejected by the learned Single Judge by holding that neither Omkar Builders nor defendant nos. 1 to 6 - RA Group could have been directed at this stage to execute 'Annexure E' to the consent terms nor could the RA Group be restrained from dealing with the properties that form the subject matter of Kash Foods property. The learned Single Judge also observed that unless and until the supplementary consent terms are entered into between the parties, there is no obligation on the part of defendant nos. 1 to 6 to execute the letter of allotment in the form of 'Annexure E'.
Intra court appeal against judgment and order of single Judge was dismissed by Division Bench.
Finding of the Court:
High Court rightly rejected the execution petition.
Result: Appeals disposed of.
JUDGMENT
M.R. Shah, J.
Feeling aggrieved and dissatisfied with the impugned judgment and order dated 21.12.2017 passed by the High Court of Judicature at Bombay in Appeal (L) No. 447 of 2017 with Notice of Motion (L) No. 2541 of 2017 in Appeal (L) No. 447 of 2017, by which the Division Bench of the High Court has dismissed the said intra court appeal preferred by the appellants herein - original plaintiffs and has confirmed the judgment and order passed by the learned Single Judge dated 30.11.2017 dismissing the execution petition, the original plaintiffs -decree holders have preferred the present appeals.
2. The dispute is between the appellants herein - original plaintiffs (hereinafter referred to as 'PA Group') and respondent nos. 1 to 6 herein -original defendant nos. 1 to 6 (hereinafter referred to as 'RA Group') and also between original defendant no. 10 - Omkar Realtors and Developers Private Limited (hereinafter referred to as 'Omkar Builders'). The dispute was with respect to the asset of Kash Foods Private Limited admeasuring 4134 square meters plot at Worli, Mumbai.
2.1 That the appellants herein - original plaintiffs filed a Suit (L) No. 194 of 2015 against the respondents herein/original defendants seeking the relief against the transfer of the property of Kash Foods Private Limited in favour of respondent no. 10 herein - defendant no. 10 - Omkar Developers. As observed hereinabove, the original plaintiffs Pawan Kumar Arya and others belong to PA Group and original defendant nos. 1 to 6 belong to RA Group, the brother of Pawan Kumar Arya. According to the original plaintiffs, original defendant no.7 - M.P. Recycling Company was jointly held by PA Group and RA Group with each credit or holding 50% of its shareholding. That M.P. Recycling held 25% of shareholding in Kash Foods. That Kash Foods owned a plot of land at Worli admeasuring about 4134.27 sq, meters. That 25% of the shareholding in Kash Foods was purchased by M.P. Recycling and the remaining 75% of the shareholding in Kash Foods was bought by RA Group in 2011 in their individual capacities.
2.2 That by conveyance deed dated 22.12.2012, a portion of the assets of Kash Foods was transferred to original defendant nos. 3 & 4 that are the members of the RA Group. A development agreement was executed between Omkar Builders - original defendant no. 10, Kash Foods, original defendant no. 8 and defendant nos. 3 and 4, which was subjected to challenge by the plaintiffs in the suit. According to the original plaintiffs, original defendant nos. 1 to 6 in violation of the Right of First refusal clause in favour of M.P. Recycling to buy shares of Kash Foods as contained in the Articles of Association of Kash Foods, surreptitiously and behind the back of the plaintiffs bought 75% outsiders' shareholding in the names of defendant no.1's family. According to the plaintiffs, defendant nos. 1 to 6 entered into a purported Development Agreement dated 10.04.2013 with Omkar Builders, a third party developer, to develop the Worli property behind the back of M.P. Recycling and the plaintiffs. According to the plaintiffs, under the purported Development Agreement with Omkar Builders, defendant nos. 1 to 6 and Kash Foods received Rs. 25 crores from Omkar Builders and an additional Rs. 20 crores as security. That as per the case of the plaintiffs, defendant nos. 1 to 6 and Kash Foods also received 79,000 sq. ft. carpet area, i.e., 15 flats and 72 car parking spaces from Omkar Builders under the Development Agreement. According to the plaintiffs, 15 agreements for sale were registered and executed in favour of defendant nos. 1 to 6 and Kash Foods.
2.3 According to the plaintiffs, defendant nos. 1 to 6 did not give any rights/benefits in the said consideration/carpet area received from Omkar Builders either to the plaintiffs and/or to M.P. Recycling. The aforesaid led to the filing of the suit by the plaintiffs against original defendant nos. 1 to 6 seeking a 50-50 division of the benefits
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