Davasia Chacko vs Venkita Krishan Iyer

P.K. Shamsuddin, J.—2nd defendant in O. S. 211/90 on the file of Court of Principal Subordinate Judge, Alappuzha is the appellant. Suit was filed for a declaration that the decree in O. S. No. 81/78 on the file of Sub Court, Alappuzha is not binding on the plaintiff and that he has become the absolute owner of plaint schedule property and for an injunction restraining the defendant from taking further proceedings in execution of the aforesaid decree. In the alternative, he prayed for a decree directing the defendant to specifically perform the agreement of sale dated 26-3-1974 executed by 1st defendant in favour of plaintiff. The plaintiff also filed I. A. No. 1602 of 1990 under Order XXXIX Rules 1 and 2. and Section 151 C.P.C. seeking a temporary injunction restraining the 2nd defendant from taking further proceedings in execution of the decree in O. S. 81/78 of Sub Court, Alappuzha and taking possession of the plaint schedule property till disposal of the suit.

Brief facts essential for disposal of the CM. Appeal are as follows: The plaintiff filed O. S. 211 of 1990 alleging that the plaintiff and the 1st defendant executed an agreement for sale of plaint schedule property by the defendant in favour of plaintiff. Towards sale consideration, plaintiff paid to 1st defendant a sum of Rs. 5.000A on 11-1-1973 and Rs. 20,000/- on 22-3-1973 and plaintiff was put in possession of the property. As seen from endorsements made on the agreement, the balance of consideration was also paid on different dates. Plaintiff repaired the building standing in the property and let out the same. He was paying the building tax in respect of the building and was taking the income from the property. While so, for the arrears of sales tax due from 1st defendant, revenue recovery proceedings were taken and the property was brought to sale. Thereupon, plaintiff filed O. S. No: 186/81 before the Munsiff''s Court, Alappuzha for a permanent injunction, restraining the defendants therein from proceeding against the plaint property for realisation of arrears of tax. On knowing this, the 2nd defendant got himself impleaded as additional 4th defendant on the allegation that he had filed O. S. 81/78 and obtained a decree for specific performance of an agreement in respect of 1 acre and 411/2 cents from out of the suit property on the strength of an agreement dated 5-1-1978. The contention raised by the 2nd defendant herein as 4th defendant was not gone into by the trial court and it was, left open as the court felt that it was not necessary for disposal of the suit. It is the plaintiff''s case that the alleged agreement of 1st defendant with the 2nd defendant dated 5-1-1978 was executed with full knowledge and notice of the agreement for sale in favour of plaintiff that the plaintiff was not a party to O.S. 81/78 and the decree passed therein will not bind him or his right over plaint schedule property and that therefore the plaintiff was entitled to get a decree as prayed for. In the above interlocutory application, the plaintiff urged that in the above circumstances, he is entitled to a temporary injunction.

Appellant filed a counter affidavit contending that the suit and the application for temporary injunction are filed without any bonafides and they are not maintainable in law and that the suit was filed in collusion with the 1st defendant. According to the appellant, the alleged agreement is a concocted one brought about at the instance of 1st defendant. The allegation of payment of consideration and delivery of possession was denied and it was contended that the property was always in the possession of 1st defendant. It was also alleged that plaintiff had no financial resources to pay the alleged consideration, that the present suit was filed to defeat the claim of the appellant, and that therefore he is not entitled to any reliefs u/s 53A of Transfer of Property Act It was also urged that he had filed O. S. 673/1982 in the Munsif''s Court, Alappuzha for a declaration that the attachment effected on the scheduled property by Tahsildar, Alappuzha under the Revenue Recovery Act is void and for consequential reliefs and that suit was decreed on 14-11-1983 and an appeal filed as AS. 117/1986 against the decree was dismissed by the District'' Court. According to him, the right conferred by Section 53A of T. P. Act is a right available to the person alleged to be in possession only to protect his possession and on the basis of that Section, plaintiff is not entitled to file a suit of this nature. He also alleged that the balance of convenience is in his favour and irreparable loss and injury will be caused to him, if the injunction sought is granted.

The trial court passed an order of temporary injunction, allowing the relief claimed by the plaintiff. Aggrieved by the said order, 2nd defendant has filed this appeal.

Learned counsel for appellant raised the following contentions : (1) The court below acted illegally in granting temporary injunction restraining the appellant from executing the decree obtained by him (2) The alternative relief claimed by Plaintiff itself is barred by limitation; (3) The protection afforded by Section 53A of T. P. Act can only be used as a shield and not a sword and therefore the suit itself is not maintainable; (4) Section 41 (b) of Specific Relief Act clearly restrains any person from instituting or prosecuting any proceedings in a court not subordinate to that from which the injunction is sought and on that ground also, suit as well as the temporary injunction prayed for are not maintainable.

Section 53A of the Transfer of Property Act reads as follows :-

Where any person contracts to transfer for consideration any immoveable property by writing signed by him or on his behalf from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty, and the transferee has, in part performance of the contract, taken, possession of the property or any part thereof, or the transferee, being already in possession, continues in possession in part performance of the contract and has done some act in furtherance of the contract, and the transferee has performed or is willing to perform his part of the contract, then notwithstanding that the contract, though required to be registered, has not been registered, or, where there is an instrument of transfer, that the transfer has not been completed in the manner prescribed therefor by the, law for the time being In force, the transferor or any person claiming under him shall be debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession other than a right expressly provided by the terms of the contract: Provided that nothing in this section shall affect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof.

This Section was inserted by Transfer of Property (Amendment) Act, 1929. A document of sale of an immovable property of the value of more than Rs. l00/- is required to be registered to effect a valid transfer. The above Section has introduced into this country the English equitable doctrine of part performance. Necessary conditions for application of Section 53A are that (i) there is a contract to transfer immovable property for consideration; (ii) the contract is signed by or on behalf of the transferor, (iii) the terms can be ascertained with reasonable certainty from the document; (i v) the transferee is put in possession or if he has been already in possession, continues in possession, (v) he has done some act in furtherance of the contract; and (vi) the transferee has performed or is willing to perform his part of the contract.

If these conditions are fulfilled, the transferor or any person claiming under him is debarred from enforcing against such transferee and persons claiming under him any right other than a right expressly provided by the terms of the contract in respect of the property. The Proviso however lays down that nothing contained in the section shall affect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof.

The contention of learned counsel for appellant is that this provision can be used only as a shield and not as a sword. To put it differently, section 53A confers no active title on the transferee. Learned counsel for appellant contended that in the instance case, the attempt of plaintiff is to use it as a sword.

In V. J. Varghese v. K. V. Thomas 1991 (2) KLJ 4, I had occasion to consider the scope of Section 53A. It was held that the right u/s 53A of T. P. Act creates only an estoppel against the transferor or persons claiming under him from enforcing any right in respect of the property against the transferee or person claiming under him, and the transferee does not get any right to claim possession or any other right in the property on the basis of an unregistered document; and the right to plead estoppel conferred by Section 53A on a transferee Is a fight available to the transferee in order to defend his possession. In arriving at the above conclusion, I have relied on the decision of the Privy Council in AIR 1940 1 (Privy Council) and the decision of the Supreme Court in Delhi Motor Company and others v. V.A. Basrurkar A.1.R. 1968 SC 794 and Technicians Studio Private Ltd. Vs. Smt. Lila Ghosh and Another, .

However, learned counsel for respondent submitted that though the respondent is the plaintiff in the suit, he is only trying to defend his right u/s 53A. According to him what matters is the effect of the suit and not whether such transferee figures as plaintiff or defendant in the suit.

In support of his contention, learned counsel invited my attention to a catina of decisions. A Division Bench of the Madras High Court considered the scope of Section 53A in S. F. Munnuswamt Gounder and others v. Erusa Gounder (A.I.R. 1975 Mad 25) and observed as follows :-

Section 53A of the Transfer of Property Act does confer some right on the transferee, if the conditions of that section are fully satisfied, and what is that right is also clear from the provisions of Section 53A. The right is to have the transferor or any person claiming under him debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession. This right can be enforced by the transferee always as a shield and not as an independent claim either in the capacity of plaintiff or defendants, that is to say, he cannot ask for title basing his claim on the fact that he has fulfilled the conditions of Section 53A. But he can, as a shield, ask for protection of the right envisaged by Section 53A by debarring; in other words, by getting an injunction against the transferor and those claiming under him from interfering with his possession.

A similar view was expressed by a Division Bench of the Andhra Pradesh High Court in Yenugu Achayya and Another Vs. Ernaki Venkata Subba Rao and Others . The court observed:-

It is settled law that u/s 53A of the Transfer of property Act, no title passes to a transferee. He cannot file a suit for a declaration of his title to the property or seek to recover possession of the same on the basis of any title conferred on him. But, if the conditions laid down in the section are complied with, it enables the transferee to defend his possession if the transferor seeks to enforce his rights against the property. This statutory right he can avail himself both as a plaintiff and as a defendant provided he is using his right as a shield and not as a sword. Or to put it in other words, he cannot seek to enforce his title but he can resist the attack made by a transferor.

In Pandit Ram Chander Vs. Pandit Maharaj Kunwar and Others, lease of certain properties was not completed in accordance with law, but lessee obtained possession. A suit wa filed by lessee seeking injunction restraining the lessor from interfering with his possession as lessee of the property. It was held by a Division Bench of the Allahabad High Court that the plaintiff was only seeking to debar the defendants from interfering with his possession and by doing so he was protecting his rights. In that view the court held that the lessee is entitled to protection u/s 53A. In Durga Prasad and Others Vs. Kanhiyalal and Others, the court went further and held that even the fact that a suit for specific performance of a contract on the strength of an agreement of sale is barred, would not take the right of the transferee if the circumstances mentioned in Section 53A are present. The same view has been expressed by a Single Bench of the Bombay High Court in Laxman Pandu Khadke v. Pandharinath Purushottam Rone (A.I.R. 1988 Bom 296).

Based on the authority of these decisions, it was contended that in the instant case, the plaintiff by filing the suit is only shielding his right u/s 53A of the Transfer of Property Act and not using it as a weapon and that therefore the suit cannot be considered as not maintainable.

Learned counsel for the appellant, however, brought to my notice a decision of a Division Bench of the Madras High Court in Krishnamoorthy Koundar v.Paramasiva Koundar (A.I.R. 1981 Mad 310). In that case it was held that it is well established that Section 53A of the Transfer of Property Act provides for a passive equity and not for an active equity, and therefore the plaintiff cannot seek his relief of injunction in a court of law based on Section 53A of the Transfer of Property Act though he can use S. 53A to debar the transferor who has agreed to sell the property from claiming any right in respect of that property. This view has found favour with a Single Judge of a Karnataka High Court in U. N. Sharma v. Puttegowda and another (A.I.R. 1986 Kar 99). However, I find in the above decisions no case law has been discussed.

15 I am inclined to adopt the same line of reasoning as contained in the Munnuswamy''s case (Supra) and other decisions referred to above and to hold that there may arise situations in which it would be open to a transferee coming u/s 53A of the Transfer of Property Act to file a suit for injunction to restrain the transferor or person claiming under him from interfering with his possession.

16 Now I shall deal with the contention raised by learned counsel for the appellant based on Section 41 (b) of the Specific Relief Act. Section 41(b) of the Specific Relief Act enumerates cases where injunction cannot be granted. It reads as follows :-

(a) to restrain any person from prosecuting a judicial proceeding pending at the institution of the suit in. which the injunction is sought, unless such restraint is necessary to prevent a multiplicity of proceedings:

(b) to restrain any person from instituting or prosecuting any proceeding in a court not subordinate to that from which the injunction is sought

(j)..............................

The corresponding provisions contained in Act 1 of 1877 are as follows :-

(a) to stay a judicial proceeding pending at the institution of the suit in which the injunction is sought, unless such restraint is necessary to prevent a multiplicity of proceedings:

(b) to stay proceedings in a court not subordinate to that from which the injunction is sought:

The expression "to stay proceedings" in clauses (a), (b) and (c) of Section 56 gave rise to a controversy as to whether any injunction can be directed against the court itself before which the proceeding is pending. Section 41 imposes absolute bar to the granting cf an injunction in cases enumerated therein. However, the bar contained in clause (b) is qualified by saying "unless such restraint is necessary to prevent a multiplicity of the proceedings." There is no such qualification in clause (b) and a plain reading of the said clause, will indicate that there is a total prohibition restraining any person from instituting or prosecuting any proceeding in a court not subordinate to that from which injunction is sought.

17 Learned counsel for the respondent submitted that no plea based on Section 41 (b) of the Specific Relief Act was taken in the lower court and no such ground was raised in the appeal memorandum and in the circumstances this court is not justified in considering the question. It is true that in the memorandum of appeal, though the petitioner stated that the injunction ought not to have been granted, there is no specific ground raised based on Section 41 (b) . No such specific plea has been taken in the counter affidavit filed by the defendant'' in the interlocutory application also. However the point raised is a question of law and is based on the express bar contained In Section 41 (b) of the Specific Relief Act and therefore I do not feel that I will bo justified in not considering the plea on merits.

18 In support of his contention learned counsel for the appellant heavily relied on the decision of the Supreme Court in Cotton Corporation of India Limited Vs. United Industrial Bank Limited and Others, . Dealing with the scope of Section 41 (b) the Supreme Court made the following observations :-

The Legislature manifestly expressed its mind by enacting Section 41 (b) in such clear and unambiguous language that an Injunction cannot be granted to restrain any person, the language takes care of injunction acting in personum, from instituting or prosecuting any proceeding In a Court not subordinate to that from which injunction is sought. Section 41 (b) denies to the court the jurisdiction to grant an injunction restraining any person from instituting or prosecuting any proceeding in a court which is not subordinate to the court from which the injunction is sought. In other words, the court can still grant an injunction restraining a person from instituting or prosecuting any proceeding in a court which is subordinate to the court from which the injunction is sought. As a necessary corollary, it would follow that the court is precluded from granting an injunction restraining any person from instituting or prosecuting any proceeding in a court of co-ordinate or superior jurisdiction. This change in language deliberately adopted by the Legislature after taking note of judicial vacillation has to-be given full effect.

An argument was advanced before the Supreme Court that in the case of temporary injunction Section 41(b) is not at all attracted. It was contended that Section 41(b) of Specific Relief Act deals with perpetual injunction and the temporary or interim injunction is regulated by the CPC especially so provided in Section 37 of the Act. Dealing with that argument, the Supreme Court observed as follows:

Expression ''injunction'' in Section 41 (b) is not qualified by an adjective and, therefore, it would comprehend both interim and perpetual injunction.

If a dichotomy is introduced by confining Section 41 to perpetual injunction only and Sec. 37 read with Order 39 of the CPC being confined to temporary injunction, an unnecessary grey area will develop. It is indisputable that temporary injunction is granted during the, pendency of the proceeding so that while granting final relief the court is not faced with a situation that the relief becomes infructuous or that during the pendency of the proceeding an unfair advantage is not taken by the party in default or against whom temporary injunction is sought. But power to grant temporary injunction was conferred in aid or as auxiliary to the final relief that may be granted. If the final relief cannot be granted in terms as prayed for, temporary relief in the same terms can hardly if ever be granted. In The State of Orissa Vs. Madan Gopal Rungta, a Constitution Bench of this court clearly spelt out the contours within which interim relief can be granted. The court said that an interim ancillary to, the main relief which may be available to the party on final determination of his rights in a suit or proceedings.

Ultimately, the court rejected the contention that Section 41 (b) does not stand in the way of issuing a temporary injunction u/s 37 read with Order 39.

19 In Dr. Mrs. Pari Hingorani Vs. Mrs. Shakuntala and others, , a single Judge of the Delhi High Court has also taken the same view following the above decision of the Supreme Court.

20 In Udyog Mandir Vs. Contessa Knit Wear and Others, a single Judge of the Bombay High Court set aside an interim injunction granted by the Judga of Small Causes Court, restraining defendant in a suit before him from proceeding with the Arbitration case initiated under the Maharashtra Co-operative Societies Act, holding that the Arbitrator functioning under the Maharasntra Co- operative Societies Act is not a court subordinate to the Small Causes Court and in that case, Section 41 (b) would deny jurisdiction to the court to grant an injunction because a court cannot even do temporarily what it has been prohibited by law to do finally or perpetually. This view has been reiterated in Krishnadevi Gupta and Another Vs. Banwarilal Hanuman Prasad Tibrewala and Others,

21 It was contended by learned counsel for the respondent that even if no temporary or permanent injunction can be granted u/s 41 (b) or under Order 39, yet the court had inherent power to grant injunction. Reliance was placed on Manohar Lal Chopra Vs. Rai Bahadur Rao Raja Seth Hiralal, , where Reghubar Dayal, J. speaking for the majority held that the court has inherent power to issue temporary injunction in cases which were not covered by the provisions of Order 39 of C. P. C. The court however held that inherent powers are to be exercised by the court on very exceptional circumstances and that the question of issuing an order to a party restraining him from proceeding with any other suit in a regularly substituted court of law deserves great consideration and such an order is not be made unless absolutely essential for the ends of justice. There is ''nothing in the judgment to show that inherent power can be exercised in a case where ''there is a total bar as contained in Section 41 (b) of the Specific Relief Act.

22 Learned counsel for respondent strongly relied on a decision of the Supreme Court in Oil and Natural Gas Commission Vs. Western Company of North America, . In that case, the relief claimed was to restrain the defendants from proceedings to enforce an award passed by an American court. The Supreme Court held that facts of that case are eminently suitable for granting a restraint order under Order 39. In that connection, the Supreme Court made the following observation :-

It is no doubt true that this court sparingly exercises the jurisdiction to restrain a party from proceeding further with an action in a foreign court. We have the utmost respect for the American Court. The question however is whether on the facts and circumstances of this case, it would not be unjust and unreasonable not to restrain the Western Company from proceeding further with the action in the American Court in the facts and circumstances outlined earlier. We would be extremely slow to grant such a restraint order but in the facts and circumstances of this matter we are convinced that this is one of those rare cases where we would be failing in our duty if we hesitate in granting the restraint order, for, to oblige the ONGC to face the aforesaid proceedings in the American Court would be oppressive in the facts and circumstances discussed earlier. But before we pass an appropriate order in this behalf, we must deal with the plea the High Court does not have the jurisdiction to grant such a restraint order even if the proceeding in the foreign court is considered to be oppressive. Counsel for the respondent has placed reliance on Cotton Corporation of India Limited Vs. United Industrial Bank Limited and Others, in support of this plea. In Cotton Corporations case, the question before the court was whether in the context of Section 41 (b) of the Specific Relief Act, the court was justified in granting the injunction..................

This provision, in our opinion, will be attracted only in a fact -situation where an injunction is sought to restrain a party from instituting or prosecuting any action in a court in India which is either of co-ordinate jurisdiction or is higher to the court from which the injunction is sought in the hierarchy of courts in India.''

(Emphasis supplied)

In my view, this decision only lays down that Sec. 41 (b) may not a bar to issue an injunction in prosecuting any action in a court outside India. In holding so, their Lordship derived support from an earlier decision of the Supreme Court in V.O. Tractoroexport, Moscow Vs. Tarapore and Company and Another, where the court restrained a party from proceeding with an arbitration proceedings in ''Moscow. In the circumstances, learned counsel for the respondent cannot call in aid the above decision to contend that the court is competent to issue an injunction to restrain a court in India by virtue of its inherent power or power under Order 39 CP.C. in a case which squarely falls u/s 41(b) of specific Relief Act.

23 Another decision relied on by learned counsel for the respondent is Manohar Lal Chopra Vs. Rai Bahadur Rao Raja Seth Hiralal, where the Supreme Court observed that the provisions of the code are not exhaustive and therefore even in cases which are not covered by Rules 1 and 2 or Order 39, Civil Procedure Code, a temporary injunction can be granted in exercise of powers conferred u/s 1-51 of the code. There cannot be any dispute with regard to the above proposition. But it is plain from the above discussion that inherent power cannot be invoked where there is an express prohibition of granting injunction as is contained in Section 41 (b) of Specific Relief Act.

24 It was finally submitted by learned counsel for the respondent that Section 41 (a) and (b) have to be read together and so construed, this is a, fit case to grant injunction as it is necessary to prevent a multiplicity of proceedings. I am unable to agree with the contention raised by the learned counsel. Clauses (a) and (b) are independent provisions though there may be overlapping in some areas. With regard to cases falling under Clause (b) there is a total prohibition. earned counsel for respondent argued that though O. S. 186/81 was dismissed by the trial court, his appeal A. S. 154 of 1984 from the judgment and decree of the trial court was allowed and the suit was decreed based on his contention that 1st defendant put him in possession on the basis of agreement for sale of the plaint property. He submitted that in that suit, the appellant got himself impleaded as additional 4th defendant alleging that he had filed O. S. No: 81 of 1978 and obtained a decree for specific performance on the strength of agreement for sale dated 5-1-1978 and though the trial court did not consider the said contention raised as the suit was dismissed on other grounds, it was with 4th defendant as a respondent on the party array, he filed A. S. No : 154 of 1984 and got a decree in his favour upholding the agreement pleaded by him in this case as genuine. Learned counsel for respondent submitted that the 4th defendant being a party in the appeal, he cannot be heard to contend that the finding regarding the genuineness of the agreement executed by 1st defendant in favour of plaintiff is not binding on him. However, learned counsel for appellant pointed out that the appellant has filed Second Appeal and the finding has not become final. I do not think that it is necessary for me to consider this dispute in this C. M. appeal. It is true that alleged agreement in favour of the plaintiff, which is earlier in point of time. But, it is the case of appellant that it was brought about by the plaintiff in collusion with the defendant. The counsel for appellant argued that the very fact that he did not take any steps to get the sale deed executed inspite of lapse of several years itself would go a long way to substantiate this contention. As the matter has to be decided by the trial court on taking evidence, I do not want to express any opinion on these aspects. I am only considering the question whether it is legal to issue an order of injunction, restraining the appellant from enforcing the decree obtained by him by issue of an injunction in view of the express bar contained in Section 41 (b). 1 am of the definite view that neither a permanent injunction, nor a temporary injunction under Order 39 or under the inherent powers of the court under Sec. 151 can be invoked in view of the express bar contained in Sec.41 (b) of the Specific Relief Act. It follows that the order passed by the lower court granting injunction is not maintainable and that it is liable to be vacated.

I accordingly allow the appeal and dismiss I. A. No.1602 of 1990. In the nature of the contentions raised, I give a direction to the trial court to dispose of the suit as expeditiously as possible, at any rate, within a period of six months from the date of receipt of a copy of this judgment. Parties will bear their respective costs.