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2024 Supreme(Bom) 588

IN THE HIGH COURT OF BOMBAY
Bharat P.Deshpande, J.
Ashwin R. Khalap - Appellant
Versus
Cyrus Dinyar Oshidar - Respondent
Appeal From Order No. 23 of 2023, Civil Application No. 98 of 2023
Decided On : 06-02-2024

Advocates appeared:
Nitin Sardessai, Advocate, Kabir Sabnis, Advocate, Tarun Rebello, Advocate, D.Lawande, Advocate, G.Nadkarni, Advocate, Y.V.Nadkarni, Advocate, Neveille Mukerji, Advocate, Simran Khadilkar, Advocate, Nilay Naik, Advocate

IMPORTANT POINT
The court established that for a temporary injunction to be granted, the plaintiff must demonstrate a prima facie case, balance of convenience, and potential for irreparable harm, particularly in cases involving claims of oral contracts.

Headnote:

INJUNCTION - TEMPORARY INJUNCTION APPLICATION - Order XXXIX Rule 1 and 2 of the Civil Procedure Code - The court discussed the discretionary powers under Order XXXIX Rule 1 and 2 of the Civil Procedure Code, emphasizing that the grant of a temporary injunction requires a prima facie case, balance of convenience, and the possibility of irreparable loss. The court interpreted these provisions to conclude that the plaintiffs failed to establish a prima facie case for an oral concluded contract, leading to the rejection of their application for a temporary injunction.

Fact of the Case:

The plaintiffs challenged a trial court order rejecting their application for a temporary injunction related to a property they claimed to have a concluded oral contract for purchase from the deceased owner, Mr. Jimmy Gazdar. They argued that they had made substantial payments and had a valid agreement, while the defendants contended that no such contract existed and that the plaintiffs were merely negotiating.

Finding of the Court:

The court found that the trial court's order was exhaustive and well-reasoned, concluding that the plaintiffs did not provide sufficient evidence to establish a prima facie case for an oral concluded contract. The court emphasized the need for clear evidence of such a contract, which was lacking in the plaintiffs' claims.

Issues: The primary issue was whether the plaintiffs had established a prima facie case for a temporary injunction based on an alleged oral concluded contract for the sale of property, and whether the balance of convenience and irreparable loss favored granting the injunction.

Ratio Decidendi: The court reiterated that the burden of proof lies with the plaintiffs to establish the existence of an oral concluded contract. It highlighted that mere negotiations or discussions do not equate to a concluded contract, and the absence of documentation or witness testimony further weakened the plaintiffs' position.

Final Decision: The appeal was rejected, and the trial court's order denying the temporary injunction was upheld, with the court concluding that the plaintiffs failed to demonstrate a prima facie case or the necessary elements for granting an injunction.

JUDGMENT/ORDER

1. Admit.

2. Heard with the consent of the learned Counsel appearing for the parties for the final disposal at the admission stage itself.

3. The Appellants/Plaintiffs are challenging an impugned order dtd. 5/5/2023, passed below exhibit-3 by the learned Trial Court thereby rejecting temporary injunction application.

4. Mr. Nitin Sardessai, learned Senior Counsel appearing for the Appellants would submit that the impugned order needs interference as learned Trial Court failed to consider relevant aspects such as concluded oral contract between the parties, irreparable loss which would be caused to the Plaintiffs, if the injunction is refused and thirdly, the balance of convenience tilting in favour of the Plaintiff. He would submit that rejection of the temporary injunction application is mostly on the aspect of delay in filing the suit, not establishing an oral concluded contract and thirdly, the compensation which could be awarded to the Plaintiff as the transaction is commercial in nature.

5. Mr. Sardessai would submit that there are various and numerous documents placed on record along with WhatsApp messages which prima facie show that there was an oral and concluded contract between the plaintiffs and the original owner of the suit property. He would submit that the original owner since deceased, took a loan of around Rs.50, 00, 000.00(Rupees Fifty Lakhs only) from the Plaintiffs which is clearly separate from the amount advanced by the Plaintiffs towards part consideration. He would submit that the Plaintiffs and one more person by name Raja Gopalkrishna agreed to purchase a plot of land admeasuring 2500 sq.mts. for a total consideration of Rs.6.05crores. He submits that both the Plaintiffs and the third person by name Raja Gopalkrishna were supposed to purchase 3 plots, admeasuring 833 sq.mts.(2 plots) and 834sq.mts., somewhere in February, 2020. Accordingly, public notice was also issued calling for the objections. Even draft sale deeds were exchanged. Such draft sale deeds were uploaded on the website. A copy of draft sale deed was forwarded to Ramkrishna Parsekar, the person who was looking after all the affairs of deceased Mr. Jimmy Gazdar, the original owner. The only objection was in connection with "indemnity clause".

6. Mr. Sardessai would submit that there was no dispute with regard to the Sale price and infact the Plaintiffs from time to time paid an amount of Rs.38, 50, 000.00(Rupees Thirty Eight Lakhs Fifty Thousand only) to the original owner, Mr. Gazdar. After the expiry of the owner Mr. Gazdar somewhere in August 2020, the Plaintiffs were dealing with Mr. Ramkrishna Parsekar and also with the defendants who are the Beneficiaries/Executors, according to the Will of Gazdar.

7. Mr. Sardessai would submit that the property of Gazdar consists of huge land, out of which 18, 481 sq.mts. was sold to the Defendant no. 3 somewhere in September, 2021. He submits that the plot which Plaintiffs agreed to purchase was adjacent to the land sold to Defendant No. 3. Plaintiffs immediately published a notice in the newspaper stating that they had a concluded contract with the original owner and called upon objections, if any.

8. Mr. Sardessai would then submit that Defendant No. 1 and 2 clandestinely sold the remaining portion of 2500 sq.mts. to Defendant no. 3 somewhere in December, 2021 for amount of Rs.8.00crores. The Plaintiffs were supposed to purchase this land as per their concluded contract. Once the Plaintiffs got this knowledge, they filed the suit for specific performance and an injunction application praying to maintain status quo with regard to area of 2500 sq.mts.

9. Mr. Sardessai would submit that Defendant No. 3 cannot be considered as bonafide purchaser as the Plaintiffs published a notice in the newspaper stating that they had a concluded contract with Mr. Jimmy Gazdar and therefore they are intending to purchase such land.

10. Mr. Sardessai would submit that since there is a concluded oral

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