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2022 Supreme(Guj) 1785

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
A.P. THAKER, J.
Darpan (Ghatlodia) Cooperative Housing Society Limited Thru Chairman Naresh Gangaram Rathod – Appellant
Versus
Dahyabhai Maganbhai Rabari(Desai) @ D.M.Desai – Respondents
R/Appeal From Order No. 306 of 2019 With Civil Application (For Stay) No. 1 of 2019
Decided on : 31-03-2022

Advocates:
Advocate Appeared:
For the Appellant : MS SEJAL K MANDAVIA
For the Respondent: MR PATHIK M ACHARYA, MS TRUSHA K PATEL

Headnote:

Specific Performance - Agreement to Sell - [Specific Performance] - [Section 36 of the Specific Relief Act, 1963, Section 37 of the Specific Relief Act, 1963] - The court discussed the principles of granting or refusing interim relief and the discretionary nature of the remedy for specific performance. The court referred to the latest decision of the Apex Court in Ambalal Sarabhai Enterprise Limited v. K.S. Infraspace LLP Limited and Another (Supra) and emphasized the need for the plaintiff to establish a strong prima facie case based on undisputed facts. The court also highlighted the importance of balance of convenience and irreparable injury in granting temporary injunctions. It further noted that time is not regarded as the essence of the contract in the sale of immovable property, unless specified by mutual consent.

Fact of the Case:

The plaintiff entered into an agreement to sell with the defendant for a piece of land. The plaintiff alleged that despite part payment and possession being handed over, the defendant did not execute the sale deed and instead sold the property to other parties. The plaintiff filed a suit for specific performance of the contract and sought interim injunction, which was rejected by the trial court.

Finding of the Court:

The court found that the plaintiff had established a strong prima facie case based on undisputed facts. It noted that time was not regarded as the essence of the contract in the sale of immovable property unless specified by mutual consent. The court also observed that the trial court had not considered the documentary evidence and pleadings in proper perspective, and had erred in rejecting the application for interim injunction. As a result, the court allowed the appeal, quashed the impugned order, and directed the defendants to refrain from dealing with the property until the final disposal of the suit.

Issues: The issues revolved around the execution of the sale deed, the period of limitation, the conduct of the parties, and the discretionary nature of the remedy for specific performance.

Ratio Decidendi: The court emphasized the need for the plaintiff to establish a strong prima facie case based on undisputed facts, balance of convenience, and irreparable injury in granting temporary injunctions. It also highlighted the discretionary nature of the remedy for specific performance and the non-consideration of documentary evidence and pleadings by the trial court.

Final Decision: The appeal was allowed, the impugned order was quashed and set aside, and the defendants were restrained from dealing with the property until the final disposal of the suit. The trial court was directed to ensure the earlier disposal of the suit, preferably within a period of 3 months from the date of receipt of the order.

JUDGMENT :

1. Being aggrieved and dissatisfied with the order dated 8.3.2019 passed by learned 2nd Additional Senior Civil Judge, Ahmedabad (Rural) in Special Civil Suit No. 92 of 2018 below Exh-5 whereby the interim injunction filed by the present Appellant- plaintiff came to be rejected by the trial Court, the original plaintiff has preferred this Appeal from Order under Order 43 Rule 1(r) of the CPC.

2. For the brevity and convenience, the parties are referred to in this order as per the character assigned to them in the trial Court i.e. plaintiff and defendant.

3. The brief facts of the case of the plaintiff is that there was an agreement to sell between it and the defendant No.1 for the land bearing Khata No.883 paiki, Revenue Survey No. 157/1/1/ paiki- T.P. Scheme No.18 (Ghatlodiya), Final Plot No. 112, admeasuring 1059 sq. mtrs of land, which is an old tenure land. That there was an agreement to sell executed on 22.10.1997 and thereafter possession of the land was handed over to the plaintiff vide Notarised document dated 25.10.2004. According to the plaintiff, there was a condition to get the title cleared and then necessary registered sale deed was to be executed between the parties. It is the case of the plaintiff that as there was litigation regarding the title of the property, though part payment of the said transaction was paid to the defendant and possession was handed over to the plaintiff by the defendant No.1, the defendant No.1 did not executed the sale-deed. That after clearance of title, instead of executing the sale-deed in favour of the plaintiff, the defendant No.1 has executed a registered sale deed in favour of respondent Nos. 2 to 5. In that view of the matter, the plaintiff has filed the aforesaid Special Civil Suit No. 92 of 2018 for specific performance of the Contract with an alternative prayer for compensation in terms of Rs. 3 Crore. Along with the plaint, the plaintiff has also filed an application at Exh-5 for interim injunction for restraining the defendant from creating any third party interest or dealing with the property or transferring to any other third party. The same came to be rejected by the trial Court by the impugned order.

4. Heard Ms. Sejal Mandavia, learned advocate for the appellant, Mr. Pathik M. Acharya, learned advocate for the defendant No.1 and Ms. Trusha Patel, learned advocate for the defendant Nos. 2 to 5 at length. Perused the material placed on record and decision cited at bar.

5. Ms. Sejal Mandavia, learned advocate for the plaintiff- appellant has vehemently submitted that there is no dispute regarding the execution of agreement to sale between the plaintiff and defendant No.1. She has submitted that at the relevant time part payment was paid to the defendant No.1 by the Society and after title clearance, the defendant No.1 had to execute the sale-deed in favour of the plaintiff. She has also submitted that in the year 2004, a document was executed before the Notary handing over the possession of the land in question to the plaintiff- Society. She has submitted that since title was not cleared, there was no execution of the sale-deed, but, as soon as order came to be passed by revenue authority, in a disputed case of revenue entry pertaining to the suit land, the defendant No.1, instead of executing the registered sale-deed in favour of the plaintiff, has executed the sale deed in favour of respondent Nos. 2 to 5. She has submitted that the defendant No.1 in written statement has only raised plea regarding limitation. However, according to Ms. Mandaliya, learned advocate for the plaintiff, since there is a transaction in respect of immovable property, time cannot be considered as essence of the Contract. She has also submitted that since there was cloud over the title of the defendant No.1, the saledeed could not be executed and, therefore, the condition of need to execute requisite sale deed in 9 months, must be read from the date of the title clearance of the defendant

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