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HIGH COURT OF CALCUTTA
Altamas Kabir & C.C. De, JJ.
Satguru Nirman Pvt. Ltd.
Versus
Narayan Chandra Paul
F.M.A.T. No. 877 of 2000
Decided On : September 12, 2002
SPECIFIC PERFORMANCE - CONTRACT FOR CONSTRUCTION OF BUILDING - CONDITIONS FOR ENFORCEABILITY - AGREEMENT BETWEEN PARTIES DID NOT VEST ANY RIGHT OR POSSESSION OF THE SUIT PROPERTY WITH THE PLAINTIFF/APPELLANT BUT MERELY CREATED A LICENCE IN HIS FAVOUR TO DEVELOP AND TO DEAL WITH THE SUIT PROPERTY - AGREEMENT HIT BY THE PROVISIONS OF SECTION 14(3)(C) OF THE SPECIFIC RELIEF ACT, 1963 - APPEAL DISMISSED.
Fact of the Case:
Plaintiff and Defendant entered into an agreement for the construction of a four-storeyed building on the Defendant's land. The Plaintiff was to receive 62% of the constructed area and the Defendant 38%. The Plaintiff filed a suit for specific performance of the contract and for damages. The Defendant contended that the agreement was not enforceable as it did not create any right, title or interest in favour of the Plaintiff and was hit by the provisions of section 14(3)(c) of the Specific Relief Act, 1963.
Finding of the Court:
The Court held that the agreement between the parties did not vest any right or possession of the suit property with the Plaintiff/appellant but merely created a licence in his favour to develop and to deal with the suit property. The Court also held that the agreement was hit by the provisions of section 14(3)(c) of the Specific Relief Act, 1963, as the Plaintiff/appellant had not obtained possession of any portion of the suit property and had not satisfied the conditions laid down in the proviso to the said section.
Issues: 1. Whether the agreement between the parties created any right, title or interest in favour of the Plaintiff/appellant? 2. Whether the agreement was hit by the provisions of section 14(3)(c) of the Specific Relief Act, 1963?
Ratio Decidendi: 1. The Court relied on the provisions of section 14(3)(c) of the Specific Relief Act, 1963, which provides that a contract for the construction of any building is not specifically enforceable unless the building or other work is described in the contract in terms sufficiently precise to enable the Court to determine the exact nature of the building or work, the plaintiff has a substantial interest in the performance of the contract and the interest is of such a nature that compensation in money for non-performance of the contract is not an adequate relief, and the defendant has, in pursuance of the contract obtained possession of the whole or any part of the land on which the building is to be constructed or other work is to be executed. 2. The Court held that the agreement between the parties did not satisfy the conditions laid down in the proviso to section 14(3)(c) of the Specific Relief Act, 1963, as the Plaintiff/appellant had not obtained possession of any portion of the suit property and had not shown that he had a substantial interest in the performance of the contract.
Final Decision: The appeal was dismissed.
Altamas Kabir, J.
The appellant/plaintiff herein filed a suit, being Title Suit No. 207 of 1999, in the 5th Court of Civil Judge (Senior Division) at Alipore, inter alia, for the following reliefs:- .
"a) For a decree for permanent injunction restraining the defendant from executing any construction work or any agreement for construction of building in the suit properties through other Developer/ Promoter or outsider excepting the plaintiff.
b) For a decree for permanent injunction restraining the defendant from selling of the flat/flats to the intending purchaser/ purchasers either himself or through any other Promoter/Developer.
c) For a decree for specific performance of contract dated 22nd September, 1997.
d) For a decree for damages likely to be cause not allowing the plaintiff to enter into the suit properties for construction of G+3 storeyed building.
e) For a decree for realization of the amount already paid against receipts after executing through Accountants Commissioner to be appointed by the learned Court with interest thereon.
f) Cost of the suit.
g) Interest and further interest.
h) Receiver.
i) Attachment.
j) Any other relief or reliefs the plaintiff is entitled in law and equity".
2. The case as made out by the plaintiff/appellant is that the plaintiff/appellant as the developer and the defendant/respondent as the owner of the suit property entered into an agreement on 22nd September, 1997, for construction of a four-storeyed building on the land measuring about 7 cottaha 4.16 chittaks lying and situated at premises No. 192-C/1, Kasba Road (now known as B.B. Chatterjee Road). In terms of the agreement the defendant/ respondent was entitled to 38% of the constructed area of the proposed building along with Rs. 8 lakhs to be paid in installments together with the proportionate share of the common facilities and amenities. It was alleged in the plaint that-despite having received various sums from the plaintiff/appellant, the defendant/ respondent failed to hand-over peaceful possession of the land with super-structure upto the ground floor, as a result whereof the plaintiff/appellant was unable to complete the construction work in terms of the agreement. It was also alleged that the action and/or inaction on the part of the defendant/respondent was with a view to frustrate the right acquired by the plaintiff/appellant under the agreement and to engage other developers to complete the construction work.
3. The plaintiff/appellant in paragraph 10 of the plaint has indicated that it was ready and willing to perform its obligations under the joint-venture agreement dated 22nd September, 1997, although the defendant/ respondent was intentionally trying to avoid the said agreement.
4. On the basis of such pleadings, the plaintiff/appellant, inter alia, prayed for a decree for specific performance of the contract dated 22nd September, 1997, and also a decree for damages, as set out hereinbefore.
5. An application under Order 39 Rules 1 and 2, read with section 151 of the Code of Civil Procedure, was filed by the plaintiff on 8th October, 1999, for an order of temporary injunction to restrain the defendant from engaging any other developer or outsider other than the plaintiff to commence and complete the construction work after physical vacant and peaceful possession of the suit properties, free from encumbrances, was given by the defendant to the plaintiff, till the disposal of the suit or, at least, till a joint inspection and measurement was undertaken of the work done by the defendant or his men.
6. The said application was taken up for hearing by the learned Court below which by its order dated 31st January, 2000, dismissed the plaintiffs said application for temporary injunction on contest on the finding that it would be a great indiscretion to tilt the balance of discretion in favour of the plaintiff.
7. This appeal has been preferred by the plaintiff against the said order of the learned 5th Court of Civil Judge (Senior
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