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HIGH COURT OF BOMBAY
Smt. Bharati Dangre, J
Pradeep Gajanan Rane – Appellant
Versus
Mohan P. Shetty & Ors. – Respondent
FIRST APPEAL NO.961 OF 2010
For the Appellants/Petitioners: Sandeep Bhagwat
For the Respondents: Sunanda Kumbhat
The appeal was dismissed as the plaintiff failed to prove any oral extension of a conducting agreement, upholding the rightful termination by the defendants.
Headnote:(A) Specific Relief Act, 1963 - Sections regarding injunction and specific performance - Contractual disputes arising out of conducting agreement for a hotel business - Allegations of wrongful termination of said agreement by the defendants - The burden of proof lies with the plaintiff to establish existence of oral assurance to extend the agreement. (Paras 11, 21)
(B) Contract Law - Terms of agreement must be adhered to as specified - Time is essentially of the essence in contracts; any failure to comply permits the non-defaulting party to terminate the agreement. (Paras 11, 21)
Facts of the case:
The plaintiff, engaged in a hotel business, sought to extend a conducting agreement but was terminated due to non-payment of dues and claims that an oral promise was made to extend the agreement by the defendants.
Findings of Court:
The trial court found that the plaintiff failed to prove the extension of the conducting agreement beyond its expiry and appropriately upheld its termination based on arrears of payment.
Issues: The main issues involved were whether there was any legal basis for the plaintiff's claim of an extended agreement and the validity of the termination by the defendants.
Ratio Decidendi: The court concluded that the plaintiff did not substantiate claims of an extension, upholding the defendants' termination of the agreement as valid and effective.
Result: The appeal is dismissed.
| Table of Content |
|---|
| 1. the plaintiff is aggrieved by the judgment and decree. (Para 1 , 2) |
| 2. plaintiff's claims regarding business operations and investment. (Para 3 , 4 , 5 , 6) |
| 3. plaintiff seeks judicial relief against termination. (Para 7 , 8) |
| 4. trial court's ruling on contract's termination. (Para 9 , 10 , 11) |
| 5. defendants' arguments supporting termination. (Para 12 , 13) |
| 6. court's findings on agreements and obligations. (Para 14 , 15 , 16) |
| 7. court confirms termination based on evidence presented. (Para 19 , 20 , 21) |
ORDER:-
1. The appellant is the unsuccessful plaintiff, who has filed the present first appeal being aggrieved by the judgment and decree dated 05/03/2010 passed by the City Civil Court at Bombay in Short Cause Suit No.3853 of 2007.
2. The appeal came to be admitted on 20/09/2011 and the stay came to be granted on Civil Application No.2667 of 2010 under which the appellant was directed to deposit Rs.45,000/- per month till disposal of the appeal with liberty to the respondents to withdraw compensation of Rs.30,000/- per month for the period commencing from 13/10/2007 till 31/07/2010 and as far as the compensation to be deposited in future, the respondents were granted liberty to withdraw Rs.30,000/- per month, the withdrawal being made subject to the final outcome of the appeal. Rest of the amount deposited by the appellant was to remain invested in fixed deposit till the final disposal of the first appeal.
3. The appellant/plaintiff was engaged in hotel business in the name and style of “Malwani Kinera” from 1997 to 2002 on the ground floor of Chandra Mansion, Gokhale Road, Dadar Mumbai. He claimed to have acquired goodwill and reputation of Malwani food and since his requirement was for a larger premises for expansion of business activity, he was on the lookout of a premises on the same vicinity. Defendant No.4 approached him and offered to carry on the hotel business in the premises located on the ground floor of the building known as Jilani Manzil, 120, Gokhale Road, Dadar, Mumbai –400 028.
4. Pursuant to the said offer, an agreement was entered with defendant No.1 on 14/10/2002 through her constituted attorney, defendant No.4 in the form of a conducting agreement for conducting the business. The plaintiff was put in possession of the suit premises on the basis of the said agreement and changed the name of the hotel under operation to “Hotel Malwani Kinara” and he claimed that he was running the said business till he was asked to deliver the vacant possession of the premises, in which the hotel was being run by him.
5. The case of the plaintiff is that he secured two telephone connections by removing the earlier telephone connections belonging to the defendants and he also paid the electricity bills and have also cleared dues of the sales tax department. It is his case that he invested an amount of Rs.10,31,000/- in refurbishing the premises by including new furniture, fixtures along with cash-counter, kitchen room, civil works, plastering, drainage line, etc. It is the case of the plaintiff that in October, 2004, he was diagnosed with a medical condition which compelled him to undergo the treatment and keep himself away from the business. During his absence, his wife continued to run the hotel business though it could not generate enough turnover and profit to enable the plaintiff to recover the investment. It is the case of the plaintiff that in October, 2006, the plaintiff along with his wife met defendant Nos.1 to 4 and made a request to continue with the business for another 66 months from 14/10/2007, which was the timeline prescribed in the conducting agreement and he requested that he may be permitted to continue the business on same terms and conditions, which were agreed as on 01/12/2006. According to the plaintiff, defendant Nos.1 to 4 accorded their approval to the plaintiff and promised to execute the necessary conducting agreement at a future point of time, acting upon which, two cheques were delivered
