Back
BOMBAY HIGH COURT
Roshan Dalvi, J.
Nirav Deepak Modi —Plaintiff
versus
Najoo Behram Bhiwandiwala
and Ors. —Respondents
Notice of Motion No. 1443 of 2006 in Suit No. 1166 of 2006
Decided on 3.2.2012
For the Plaintiff:Mr. Ashish Kamath alongwith Mr. Sarthak Shah, Mr. Vatsal Shah i/b Naik, M/s. Naik & Co., Advocates.
For the Defendant No.1:Mr. Karl Tamboly alongwith Mr. P. Goyal i/b M/s. Wadia Ghandy & Co., Advocates.
For the Defendant No.2:Mr. Kalpesh Nani, Advocate.
For the Defendant Nos.3 and 4:Mr. Rahul Chitnis along with Mr. Rajiv Seth i/b Mr. H.H. Nagi, Advocates.
IMPORTANT POINT
A specific performance suit can be filed, even upon an oral agreement.
Headnote:Suit for specific performance—Plaintiff filed suit for specific performance of an oral agreement entered into by plaintiff with defendant 1 pursuant to which the defendant 1 made two declarations—Notice of Motion also taken out by plaintiff for appointment of Court Receiver and usual injunctions for protecting suit property—The repudiation by defendant 1 was, seen to be without cause— This constituted a breach of Agreement between parties as reflected in the two declarations and the consequent correspondence- The case of oral agreement of plaintiff was prima facie substantiated by corroborative evidence—Even though declarations were not registered—However, suit for specific performance can be filed upon unregistered documents under the proviso to Section 49 of Indian Registration Act—In fact a specific performance suit can be filed, also upon an oral agreement—It was the agreement that plaintiff essentially seeks to have specifically enforced as per declaration executed by parties- Consequently. lack of notorisation or registration not disentitled plaintiff to the relief at least prima facie for protection of the premises agreed to be purchased by plaintiff—Relief of injunction for protecting suit property granted, but only upon plaintiff performing his part of the contract—Direction given to plaintiff to deposit Rs. 16,00,00,000 in Court —On plaintiff depositing said amount defendant Nos. 1, 3 and 4 not to sell, alienate, dispose of, encumber, create any third party rights or otherwise induct any third party in suit premises pending the suit. (Paras 33 to 36)
Result: Ordered Accordingly.
Roshan Dalvi, J.— The plaintiff has filed the above suit for specific performance of an oral agreement stated to have been entered into by the plaintiff with defendant No.1 in the beginning of April, 2002 pursuant to which the defendant No.1 made two declarations on 29 August, 2002 and 21 March 2003 and for other ancillary reliefs.
2. The plaintiff has taken out the above Notice of Motion for appointment of Court Receiver and the usual injunctions for protecting the suit property.
3. The plaintiff is admittedly the licensor of the defendant No.1. The license is created in the name of defendant No.2, the Company of the plaintiff in which he is a director. The license is in respect of two flats in the building known as “Nepean House” at Malabar Hill, Mumbai showing Defendant No.1 as the owner.
4. It is the plaintiff’s case that consequent upon the license in his favour, defendant No.1 and the plaintiff negotiated for purchase of the licensed premises by the plaintiff. The negotiations culminated in an oral agreement under which the plaintiff was given option to purchase the suit property licensed to him for a sum of Rs.16 crores. The option was to be exercised during the period of the license between 1st December, 2003 and 30 November 2008. The consideration then payable by way of earnest was Rs.10 lakhs. The purchase would be under the Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963 (“Apartment Ownership Act”).
5. The plaintiff claims to have paid Rs.10 lakhs as earnest to defendant No.1 on 21 March, 2003 by cheque. The plaintiff accordingly claims to have exercised his option.
6. It is the case of the defendant No.1 that she executed what is stated to be her declarations under a misrepresentation that those declarations were under Section 2 of the Apartment Ownership Act. She has, therefore, refuted the option to purchase the licensed premises by the plaintiff. She claims that the declarations are bogus and no consideration is received by her. This is upon the premise that the declarations are inconsistent with each other and are blank in certain material particulars. She further claims that she has already executed a conveyance in respect of the suit premises in favour of the defendant Nos.3 and 4 who have been inducted in the licensed premises after possession of the licensed premises was obtained by her in a litigation filed by her from the plaintiff in the competent forum.
7. Defendant Nos. 3 and 4 are in possession of the said flats. A Memorandum of Understanding (MoU) dated 11 April, 2007 has been executed between defendant No.1 and defendant No. 4 recital G of in which the factum of this litigation and the dispute between the plaintiff and defendant No.1 is expressly mentioned. The factum of the declaration dated 21 March 2003 got executed from her without being informed of the content, meaning and purport thereof is also mentioned. Clause 7.1.5 of the MoU shows the earnest of Rs.10 lakhs received by her by cheque No. 128276 dated 21 March 2003 from the plaintiff sent to her by the then Advocates M/s D.M. Harish and Co., and held by them in escrow, which was not encashed by her.
8. The plaintiff claims that this clause itself shows sufficient notice of the plaintiff’s claim upon. defendant Nos. 3 and 4 and consequently defendant Nos. 3 and 4 are purchasers with notice of the plaintiff’s claim. The plaintiff has also registered notice of lis pendens on 3 May 2004, a fortnight after the filing of the suit and before the execution of the MoU on 11 April 2007 between defendant No.1 and defendant No.4.
9. For grant of the reliefs to the plaintiff, the prima facie case of the plaintiff which is required to be seen by the Court would be essentially upon reading the declarations themselves as also circumstantial evidence.
10. There are four declarations relied upon by the plaintiff. Two declarations are of defendant No.1 dated 29 August 2002 and 21st Mar
