S.R. Narasimha Murthy and Others vs Habibulla V.A.

B.S. Patil, J.—This appeal is filed by defendants 1 to 4 aggrieved by the order passed by the Court below granting temporary injunction restraining them from alienating the suit schedule properties till the disposal of the suit.

Suit O.S. No. 65/2014 (renumbered as O.S. No. 6/2015) has been filed by the plaintiff - respondent herein for specific performance of Agreement of Sale dated 23.12.2013 executed by the defendants in favour of the plaintiff. The plaint averments disclose that an extent of 1 acre 37 guntas in Sy. No. 262 and 1 acre 27 guntas in Sy. No. 263 situated at Mandli Grama, Shimoga Taluk, totally measuring 3 acres 24 guntas were agreed to be sold by defendants in favour of the plaintiff for total sale consideration of Rs. 2,88,00,000/- and on the date of the Agreement, a sum of Rs. 25,00,000/- was paid.

Parties had agreed that defendants shall execute the registered Sale Deed within eight months. Plaintiff''s case is that defendants failed to execute the registered Sale Deed within the stipulated period, but obtained additional amount of Rs. 5,00,000/- on 01.09.2014 and in spite of receipt of additional amount, they did not come forward to execute the Sale Deed. Hence, on 15.11.2014, plaintiff called upon the defendants to execute the registered Sale Deed, but the defendants on the same day obtained the original Agreement of Sale from the custody of the plaintiff to show it to their sisters and to obtain relinquishment deed from them, whereupon defendants handed over notarized copy of the Agreement of Sale to the plaintiff by receiving the original from the plaintiff. Plaintiff urged that he had handed over the original Agreement of Sale to the defendants in the presence of the witnesses; as the defendants did not come forward to execute registered Sale Deed, plaintiff was constrained to file the suit.

Along with the plaint, an application seeking temporary injunction was filed. Defendants resisted the suit and the application filed. Defendants admitted the factum of having entered into the Agreement of Sale with the plaintiff and receipt of advance amount of Rs. 25,00,000/- on the date of agreement. However, they denied the receipt of another sum of Rs. 5,00,000/- on 01.09.2014. They also urged that the plaintiff agreed to get the Agreement of Sale cancelled and therefore, he torn of the original Agreement of Sale into pieces by receiving the advance amount of Rs. 25,00,000/- in the presence of mediators; thus, the Agreement of Sale no longer governs the parties.

They also urged that the torn agreement was handed over to the defendants which has been produced before the Court in a sealed envelope. Defendants further urged that the plaintiff has come up with frivolous suit on the basis of false assertions and averments.

The Trial Court, having examined the pleadings and documents on record, has granted an order of temporary injunction. It has come to the conclusion that as defendants have admitted the execution of the agreement and the receipt of advance amount of Rs. 25,00,000/- towards advance, question whether original agreement was returned by the plaintiff to the defendants and the same was torn after refund of the advance amount of Rs. 25,00,000/- by the defendants to the plaintiff were all matters to be ascertained at the time of evidence, therefore, if the relief as sought by the plaintiff was not granted, defendants being owners would proceed to alienate the property thereby endangering the rights of the plaintiff and hence, prima facie case had been made out by the plaintiff for grant of temporary injunction and the balance of convenience was also in his favour.

Having heard the learned counsel for both parties and on careful perusal of the pleadings and the impugned order, the following points arise for consideration:

"i) Whether the Court below has committed any illegality in granting an order of temporary injunction?

ii) Whether the plaintiff has indeed made out a prima facie case for grant of temporary injunction and balance of convenience lie in his favour?"

On perusal of the materials on record, I find that the Court below has not taken into consideration the entire fact situation before recording its opinion about the prima facie case made out by the plaintiff. In a suit for specific performance, plaintiff has to plead and prove the due execution of the agreement, readiness and willingness on his part to perform his part of the contract and that denial of the relief would subject him to serious prejudice and loss and therefore, he was entitled for grant of discretionary relief of specific performance of the agreement.

In order to establish the prima facie case, normally the agreement entered into between the parties, proof of payment of sale consideration by way of advance apart from the very important aspect regarding prima facie proof of readiness and willingness on the part of the plaintiff to perform his part of the contract will have to be looked into. In the instant case, the agreement is said to have been torn into pieces and is not in existence. There is nothing to show that the plaintiff had notified the defendants calling upon them to execute the Sale Deed by expressing readiness and willingness on their part. No legal notice or any exchange of letter in this regard is placed on record to prima facie come to the conclusion that plaintiff had made out a case for grant of temporary injunction.

The Court below has simply believed the version of the plaintiff that the original agreement was returned to the defendants because the defendants wanted to show the same to their sisters to obtain a relinquishment deed from them. How return of the original agreement would help the defendants to obtain relinquishment deed from their sisters and why there was no acknowledgement taken for having returned the original agreement are not forthcoming, atleast prima facie, to believe the said version of the plaintiff. The Trial Court ignoring these basic requirements has proceeded to hold that as they were matters of proof, interim order of injunction deserved to be granted restraining alienation of suit property as otherwise it would result in multiplicity of proceedings.

Grant of temporary injunction has serious consequence. Party who seeks such a relief has to demonstrate, atleast prima facie, that he has made out a case and balance of convenience was in his favour apart from establishing that the loss or injury cannot be compensated in terms of money. The Court below has not taken note of any of these factors with reference to the facts involved.

On re-examination of materials on record, I find that absence of the Agreement of Sale, total lack of prima facie proof of readiness and willingness on the part of the plaintiff, particularly when he was required to pay a huge sum of Rs. 2,88,00,000/-, by offering to pay the amount and calling upon the defendants to execute the Sale Deed have serious consequences on the prayer for grant of temporary injunction. Balance of convenience also does not lie in favour of the plaintiff. If the property is sold pending disposal of the suit, parties will be governed by the principle of lis pendens as per Section 52 of the Transfer of Property Act.

Reliance placed by the learned counsel for the appellant on the judgment in the case of Maharwal Khewaji Trust (Regd.), Faridkot Vs. Baldev Dass, AIR 2005 SC 104 : (2004) 9 JT 216 : (2005) 139 PLR 399 : (2004) 8 SCALE 862 : (2004) 8 SCC 488 : (2004) AIRSCW 6333 : (2004) AIRSCW 6523 is not opposite to the facts of the present case inasmuch as in the instant case as held herein above, unless prima facie case is made out, question of granting temporary injunction pending disposal of the suit will not arise. Even if the defendants resort to alienation during the pendency of the suit, parties will be bound by the principle of lis pendens.

Therefore, the appeal deserves to be allowed. Accordingly, the same is allowed. Impugned order is set aside. Application filed by the plaintiff under Order XXXIX Rules 1 and 2 CPC is dismissed.