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2009 Supreme(Del) 580

IN THE HIGH COURT OF DELHI
Honble Judge: Rajiv Sahai Endlaw, J.

Ravinder Singh and Anr. – Appellants
Vs.
Naresh Kukreja – Respondent
CS (OS) 1894/2008 and IA. No. 10992/2008
[Alongwith CS (OS) 46/2009 and IA. Nos. 342, 2424 and 4240/2009]
Decided On: 11.05.2009

Advocates appeared:
For Appellant/Petitioner/Plaintiff: A.S. Chandhiok, Sr. Adv., Jasmeet Singh, Saurabh Tiwari and Sameer Kulshreshtha, Advs.
For Respondents/Defendant: Sandeep Sethi, Sr. Adv. for defendant No. 1 in CS (OS) 1894/2008 and IA. No. 10992/2008 (of the plaintiff Under Order 39 Rules 1 and 2 CPC) and Sandeep Sethi, Sr. Adv. for defendant No. 1 and Amit S. Chadha, Sr. Adv. and Kunal Sinha, Advs. for defendant No. 2 in CS (OS) 46/2009 and IA. No. 342/2009 (of the plaintiff Under Order 39 Rules 1 and 2 CPC) IA. No. 2424/2009 (of the defendant No. 1 Under Order 39 Rule 4 CPC) and IA. No. 4240/2009 (of the defendant No. 1 Under Section 151 CPC)

The court emphasized the need for a valid and enforceable agreement as a precondition for specific performance, and considered the principle of lis pendens under the Transfer of Property Act.

Headnote:

Specific Performance - Oral Agreement - Transfer of Property Act - Specific Relief Act - [FACT OF THE CASE] The plaintiffs filed two suits for specific performance of an oral agreement to sell a shop. The defendant denied the agreement and claimed to have sold the shop to a subsequent purchaser. The court considered the evidence and arguments presented by both parties to determine the validity of the oral agreement and the entitlement to interim relief. [FINDING OF THE COURT] The court found that the plaintiffs failed to establish a prima facie case for the oral agreement and were not entitled to interim relief. The court also directed the plaintiffs to compensate the subsequent purchaser if their claim was found to be false. [ISSUES] The court framed common issues for trial, including the existence of the oral agreement, payment of advance consideration, and entitlement to specific performance. [RATIO DECIDENDI] The court emphasized the need for a valid and enforceable agreement as a precondition for specific performance, and considered the principle of lis pendens under the Transfer of Property Act. The court also highlighted the importance of compensating the defendants for losses due to the pendency of the suit. [FINAL DECISION] The court dismissed the applications for interim relief, allowed the vacation of the ex parte order, and directed the plaintiffs to file undertakings to compensate the subsequent purchaser. The suits were consolidated for trial with common issues framed for determination.

JUDGMENT

Rajiv Sahai Endlaw, J.

1. The applications for interim relief in both suits are for consideration. The plaintiffs in both suits are the same. The sole defendant in the first suit (CS(OS) No. 1894/2008) is the defendant No. 2 in the second suit (CS(OS) No. 46/2009).

2. The first suit has been filed for specific performance of an oral agreement to sell of 15th September, 2005 of shop No. 6-A Khan Market, New Delhi. It is inter alia the case of the plaintiffs that Shri M.R. Kukreja, father of the sole defendant in the first suit (hereafter called owner) was the owner of the said shop; on his demise on 9th December, 1986 the shop devolved on his wife Smt Sheela Devi; on demise of Smt Sheela Devi on 5th May, 1991 the owner inherited the said shop on the basis of her Will; that the owner applied for probate of the said Will which was granted vide order dated 10th May, 2005; that the owner approached the plaintiffs to sell the said shop and after detailed negotiations an oral agreement of sale and purchase of the said shop was reached on 15th September, 2005, for a total consideration of Rs 1 crore; that it was agreed that the owner would get the shop converted from lease hold to free hold and obtain the necessary permission from the L&DO that the plaintiffs at the time of oral agreement to sell paid the sum of Rs 4 lacs by cheque issued on behalf of the plaintiff No. 2 by his daughter Ms Gurbani Kaur and a sum of Rs 6 lacs in cash to the owner; that the owner, however, kept delaying the matter and on plaintiffs inquiry handed over to the plaintiffs correspondence exchanged with the L&DO from which it seemed that the owner was unable to get the shop mutated in his name in the L&DO. The plaintiffs further claim that they issued a legal notice dated 8th May, 2008 calling upon the owner to execute the sale deed and thereafter on 9th September, 2008 filed the suit for specific performance.

3. Though the first suit was accompanied with an application for ex parte interim relief but no ex parte interim relief was granted to the plaintiffs and notice of the suit and of the application was issued to the owner for 10th November, 2008. The owner though reported to be served did not appear before the court on 10th November, 2008 and the suit was adjourned to 31st March, 2009 for framing of issues and for arguments on the application. Even then no interim relief was granted to the plaintiffs.

.4. The plaintiffs instituted the second suit on 9th January, 2009. It was stated in the plaint therein that the owner had intentionally failed to appear before the court on 10th November, 2008 and had inspite of the pendency of the suit for specific performance entered into and registered an agreement to sell on 3rd December, 2008 with the defendant No. 1 in the second suit (hereafter called subsequent purchaser) for a total sale consideration of Rs 75 lacs; that the plaintiffs had come to know of the said agreement to sell on 24th December, 2008. The plaintiffs thus sued for declaration that the agreement to sell dated 3rd December, 2008 executed by the owner in favour of the subsequent purchaser was null and void and for restraining the subsequent purchaser who had in pursuance to the registered agreement to sell dated 3rd December, 2008 (supra) been put into possession of the shop from alienating, encumbering or parting with possession thereof. In the second suit vide ex parte order dated 13th January, 2009 the defendants therein were directed to maintain status quo qua suit property. The said order continues till date.

.5. The owner has denied any agreement to sell with the plaintiff. Though the receipt of cheque for Rs 4 lacs is admitted but it is pleaded that it was for sale of certain jewellery and other antique items to Ms Gurbani Kaur who had admittedly issued the cheque. The receipt of Rs 6 lacs in cash is denied. It is further his case that the shop had been let out by his father Shri M.R. Kukreja to one Shri Balwant Rai Pruthi in the y

















































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