1998 Supreme(Guj) 102
Gujarat High Court
Judgename :R.BALIA
Lalan Agency Thropartner Sardaprabha Vauabhbhai Parikh - Appellant
Versus
Chandrakant Purshottamdas Mehta - Respondent
APPEAL FROM ORDER 494 of 1997
Decided On : 03/05/1998
Subject
Contract Law - Specific Performance
Act Referred
SPECIFIC RELIEF ACT : .
Headnote
It is also to be noticed that defendant has pleaded categorically that the property was self acquired property until 23.3.1993 on which date by his act whether of a gift or declaration of his intention, it became the property of his joint family consisting of himself, his wife and two sons and a partition of the entire joint Hindu family property including the property in question took place on 1.4.1993 which was duly recognised by the Income Tax authorities, in the proceedings for the assessment year 1993-94 under Sec. 171 of the Income Tax Act, 1961. It does make out a prima facie case that there was or there exists a fairly arguable dispute about the clear title of the defendant to pass the property to the plaintiff as per the oral agreement pleaded, giving credence to the prima facie conclusion to which I have reached that the intention of the parties to execute a formal agreement after the defendant is able to procure a title clearance certificate, militates against treating the outcome of negotiation dated 24.9.1993 as a concluded oral agreement for the sale of the property in question.
[Para 17]
He has entered in agreement on 24.9.1993 at a consideration of Rs. 6591/- per sq. yard and when the suit was filed after about 2 years the market price of the property was Rs. 15000/- per sq. yard. If earlier fixation of price is considered the true reflection of market price on that date, it is clearly case of galloping inflation of price, during the inaction on the part of plaintiff, which will prima facie make the grant of relief of specific performance inequitable.
[Para 20]
On the admitted facts market price on the date of filing of suit was Rs. 15000/- per sq. yard, about more than 250% of consideration pleaded.
[Para 22]
When Court do not find prima facie a completed oral agreement came into existence as on 24.9.1993, and also that enforcement of such oral agreement as it is will be against public policy in the facts and circumstances of present case, the question of issuing temporary injunction during pendency of the suit must be answered in negative.
[Para 23]
( 1 ) THIS appeal is by the plaintiff, a registered partnership firm Shri Lalan agency against the order dismissing notice of motion dated 4. 9. 1997 in Regular Civil Suit no. 2945 of 1995, pending in the Court of City Civil Judge at Ahmedabad.
( 2 ) THE plaintiff filed the suit alleging that it is engaged in the business of constructing, organising, developing and buying and selling of and all other dealings in connection with lands, buildings and other kinds of real estate. In the month of August 1993, Shri Kamlesh Parikh, who is an authorised representative of the plaintiff firm and looking after the business of the firm on being approached by one broker Shri Ramesh M. Gadhvi entered into an oral agreement to purchase with the defendant, who is the owner of the property situated in Gulbai Tekhra, Ahmedabad bearing Plot No. 634 in Town planning Scheme No. 3/6 situated in Kochrab area at Ahmedabad.
( 3 ) ACCORDING to plaint assertions it was agreed between the parties that the said property comprising land admeasuring 1746 sq. mts. (2088 sq. yds) together with construction of Jyotirdip Bungalow therein be sold by the defendant to the plaintiff or its nominee at the rate of Rs. 6591/- per sq. yd. and the plaintiff firm through its authorised representative Kamleshbhai Parikh agreed to purchase the said property. In pursuance of the said agreement, Rs. 2,61,000/- were paid by cheque to the defendant on 24. 9. 1993 drawn on Kalupur Commercial Cooperative Bank Limited, Vikram Branch, Ahmedabad. The other terms of agreement were alleged to be that formal agreement for sale would be executed in favour of the plaintiff by the defendant upon defendant getting his title to the aforesaid property clear and marketable and on that the purchaser plaintiff firm will part with 20% of the total consideration of amount which is to be paid by the plaintiff to the defendant. It was also agreed that the said banakhat or agreement to sale was to be registered and as required under the provisions of the Income Tax Act will be filed by the parties before the concerned authorities within a period of 15 days from the registration of the aforesaid banakhat. It was also mutually agreed between the parties that the conveyance will be executed by the defendant after clearance by the Income-Tax authority under Sec. 269uc of the Income-Tax Act within six months thereof. In pursuance of this agreement the defendant entrusted the work of clearance of title in respect of the property in question to M/s. Jani and company, advocates and solicitors and through them got a public notice published inviting claims in respect of the said property in the local daily, Gujarat Samachar dated 4. 10. 1993. It was averred in the plaint that the communication and acceptance of the offer was very much complete on 24. 9. 1993 bringing in existence a binding contract between the plaintiff and defendant creating mutual obligations and reciprocal promises which both the parties were liable to honour. Defendant has not yet been able to get title clearance certificate. On 1. 5. 1995 the plaintiff received under a registered letter a cheque of Rs. 2,61,000/- from the defendant. The letter was addressed to Kamleshbhai Parikh with reference to which it was averred that kamlesh Parikh, the alleged authorised representative of the plaintiff firm had no such authority whatsoever as referred in the above said letter by the defendant. Treating the return of Rs. 2,61,000/- by the defendant as refusal to go ahead with the alleged oral agreement dated 24. 9. 1993, the present suit for specific performance of agreement has been filed. According to the plaintiff as on the date of filing of the suit, market price of the land in question was Rs. 15,000/- per sq. mt. A notice of motion was also moved along with the plaint, and it was prayed that pending hearing and final disposal of the suit, the defendant be restrained from dealing with the suit property and from entering into any k