Makers Development
Services Pvt. Ltd. Vs. M. Visvesvaraya Industrial Research and Development
Centre
J U D G M E N T
P. Sathasivam, J.
1.
Leave
granted in both the Special Leave Petitions. Both these appeals were heard together
as they arose out of the same set of facts and common questions of law were
involved.
2.
SLP
(C) No. 22276 of 2011 has been filed by the Makers Development Services Pvt. Ltd.
against the order dated 28.06.2011 passed by the Division Bench of the Bombay
High 1Court in Appeal No. 280 of 2008 challenging the order dated 25.04.2008 passed
by the learned Single Judge in Notice of Motion No. 3499 of 2007 in Suit No. 2618
of 2007 declining the reliefs claimed in prayer clauses (a) to (f) pending final
disposal of the Suit and SLP (C) No. 25972 of 2011 has been filed by M.
Visvesvaraya Industrial Research and Development Centre against the same order in
Appeal No. 289 of 2008 in Notice of Motion No. 3499 of 2007 in Suit No. 2618 of
2007 granting relief in terms of prayer clause (g).
3.
Brief
facts:
a. Makers Development Services
Pvt. Ltd.-the appellant herein (Original Plaintiff) is a Company registered under
the Companies Act, 1956 engaged in the business of development, building, including
the construction and management of hotels and developments pertaining to other hospitality
services and management of properties. M. Visvesvaraya Industrial Research and Development
Centre-the respondent herein (Original Defendant) is a Company incorporated
under the Companies Act, 1956 and is engaged, inter alia, in promoting,
establishing, conducting and undertaking scientific research.
b. The Government of Maharashtra,
by Resolutions dated 16.10.1970 and 18.11.1974, had granted lease of certain
plots of land to the defendant-Company at Backbay Reclamation, Cuffe Parade, Mumbai,
who was entitled and authorized to enter into transactions with third parties
in respect of the said land. A portion of that land admeasuring 13,326 sq. mts.
which forms a part of the larger land held by the defendant-Company is the
subject-matter of the present case.
c. An agreement dated 10.11.1980
was entered into between the parties for construction of a composite hotel
complex consisting of a Hotel Building, a Convention Centre and an Exhibition Centre
on the Suit Land (Tower No.2) and the plaintiff would be granted lease of Hotel
(exclusive of the Convention and Exhibition Centre) for 60 years with an option
of renewal of lease. This agreement came to be modified from time to time. d) Pursuant
to the Agreement, the respondent put the appellant in possession of the Suit
Land on 16.07.1990, which continues to remain with the appellant till date.
d. Since the appellant
could not complete the work and due to disputes and differences, the respondent,
on 31.07.2007, affixed a notice on the premises notifying all concerned including
the appellant to move out of the property and instructed its security persons not
to permit the appellant to enter upon the said property.
e. On 04.08.2007, the appellant
filed a suit for injunction before the City Civil Court, Mumbai seeking interim
and final reliefs restraining the respondent from taking any illegal steps. By
order dated 06.08.2007, the learned Judge held that till the substantive suit
is filed by the appellant, the impugned notice dated 31.07.2007 will not be acted
upon by the defendants upto and inclusive of 17.09.2007.
f. On 10.09.2007, the appellant
moved a Notice of Motion No. 3499 of 2007 in a Suit being No. 2618 of 2007
before the learned Single Judge of the Bombay High Court for a decree of
specific performance, inter alia, praying for a permanent injunction restraining
the respondent from dispossessing the appellant. By ad-interim order dated 14.09.2007,
the assurance given in the City Civil Court was directed to be observed and the
respondent was directed not to create any third party rights pending the Notice
of Motion. During the pendency of the suit, by letter dated 19.11.2007, the
respondent terminated the said Agreement. The learned single Judge, after
referring the documents and affidavits on record, rejected prayer clauses (a) to
(f) of the Notice of Motion and granted limited interim relief with regard to
prayer clause (g) in favour of the appellant.
g. Aggrieved by the order
of the learned single Judge, the appellant preferred an appeal being Appeal No.
280 of 2008 before the Division Bench of the High Court. With regard to the limited
relief granted by the learned single Judge, the respondent also filed an appeal
being Appeal No. 289 of 2008 before the Division Bench of the High Court.
h. The Division Bench,
by a common judgment, upheld the order of the learned single Judge and dismissed
both the appeals. Challenging the order of the Division Bench of the 5High Court,
the appellant and the respondent filed separate special leave petitions before
this Court.
1.
2.
3.
4.
Heard
Mr. Shyam Divan, learned senior counsel for the appellant and Mr. Mukul Rohatgi
& Mr. Praveen Samdani, learned senior counsel for the respondent.
5.
The
points for consideration in these appeals are:-
a. Whether the
appellant/plaintiff has made out a case for grant of injunction in its
entirety, i.e. prayer clauses (a) to (g)?
b. Whether learned
single Judge as well as Division Bench of the High Court committed an error in
granting limited relief in respect of clause (g)?
1.
2.
3.
4.
5.
6.
It
is settled law that while passing an interim order of injunction under Order XXXIX
Rules 1 and 2 of the Code of Civil Procedure, 1908, the Court is required to
consider three basic principles, namely,
a. prima facie case,
b. balance of
convenience and inconvenience and
c. irreparable loss and
injury.
In addition to the above
mentioned three basic principles, a court, while granting injunction must also take
into consideration the conduct of the parties. It is also established law that the
Court should not interfere only because the property is a very valuable one. Grant
or refusal of injunction has serious consequences depending upon the nature thereof
and in dealing with such matters the court must make all endeavours to protect the
interest of the parties.
1.
2.
3.
4.
5.
6.
7.
With
the above principles, let us consider the claim of both the parties.
8.
The
appellant/plaintiff, who filed Suit No. 2618 of 2007 on the file of original
side of the High Court of Bombay prayed for the following interim reliefs pending
hearing and final disposal of the said suit:
a. "That pending the
hearing and final disposal of the Suit, the Defendant be ordered and directed to
do, sign, execute, deliver and register all such acts, deeds, matters writings,
documents, authorities papers, plans, sanctions and things as may be necessary to
enable the Plaintiff to continue construction on the Suit Land in terms of the
Suit Contract;
b. That pending the hearing
and final disposal of the Suit, the Defendant by itself, its servants and
agents or any person or persons claiming by, from, through or under them be
restrained by an order and injunction of this Court from dispossessing the Plaintiff
or removing the authorized representatives, employees, staff, workers and labourers
of the Plaintiff and their respective family member or their belongings and articles
or the construction materials, equipment and other belongings of the Plaintiff
from the Suit Land;
c. That pending the hearing
and final disposal of the Suit, it be ordered and decreed that the Defendant to
allow the Plaintiff to continue construction on the Suit Land and unhindered
access to the Suit Land and allow ingress to and egress from the Suit Land, by the
Plaintiff, its representatives, employees and contract labour as also for all construction
materials and equipment without in any manner, directly or indirectly, obstructing
or hindering the Plaintiff.
d. That pending the hearing
and final disposal of the Suit, the Defendant by itself, its servants and
agents or any person or persons claiming by, from, though or under them be restrained
by an order and injunction of this Court from in any manner restraining, preventing
impending or obstructing implementation of the Suit Contract or construction on
the Suit Land or access to and ingress to and egress from the Suit Land, of the
Plaintiff or its authorized representatives, employees, workers, labourers and
their respective family members or preventing, impeding or obstructing construction
material or equipment of the Plaintiff from being brought on to the Suit land or
in any manner, directly or indirectly, by any act of omission or commission,
withholding or causing to be withheld essential utilities such as power and
water supply to the Suit Land for construction by the Plaintiff;
e. That pending the hearing
and final disposal of the Suit, the Defendant by itself, its servants and
agents or any person or persons claiming by, from, through or under them be
restrained by an order and injunction of this Court from in any manner, whether
directly or indirectly, revoking or acting on any purported revocation of the
Letter of Authority granted by the Defendant to the Plaintiff or in any manner,
whether directly or indirectly, hindering, impeding or obstructing construction
on the Suit Land in terms of the Suit Land in terms of the Suit Contract;
f. That pending the hearing
and final disposal of the Suit, the Defendant by itself, its servants and
agents or any person or persons claiming by, from, through or under them be
restrained by an order and injunction of this Court from in any manner committing
unlawful trespass or from in any manner intimidating the Plaintiff, its employees,
workers, labourers and other agencies appointed by the Plaintiff;
g. That pending the hearing
and final disposal of the Suit, the Defendant by itself, its servants and agents
or any person or persons claiming by, from, through or under them be restrained
by an order and injunction of this Court from, in any manner, selling transferring,
dealing with, disposing of, alienating encumbering or creating any third party
rights or interest in, or entering into any agreement or arrangement with any one
else in respect of the Suit Land or any part thereof;"
1.
2.
3.
4.
5.
6.
7.
8.
9.
Among
the above prayers for interim reliefs, the learned single Judge granted relief
only in respect of prayer clause (g) that too with a condition, namely, except the
words "dealing with". The learned single Judge on satisfying himself
and after thorough scrutiny of the materials placed rejected the relief insofar
as prayer clauses (a) to (f), which resulted in filing of above two appeals by the
appellant and the defendant.
It is the claim of the
appellant/plaintiff that on the basis of the contract between the parties, the
learned single Judge and the Division Bench should have granted an order permitting
the appellant to carry on further construction especially when construction of about
80 ft. had already been raised by the appellant on the suit land. On the other
hand, it is the case of the defendant that there is no existing agreement
between the parties and the only point is that the parties have agreed to 9enter
into an agreement and, therefore, the learned single Judge as well as the
Division bench were not justified even in granting interim order in terms of
prayer (g).
10.
Inasmuch
as the main suit is pending, it would not be proper for this Court to delve
into the matter and arrive at a categorical finding one way or other. Accordingly,
we have to find out whether there is prima facie case and `balance of
convenience' in terms of principles mentioned above.
11.
The
finding of the learned single Judge about the construction of the building to
the height of 80 ft. on the suit land by the appellant cannot be ignored. However,
whether the defendant permitted the appellant to enter on the suit land and to
carry on construction are all matters to be decided in the main suit.
The limited relief
granted in clause (g) by the learned single Judge is quite understandable, otherwise,
it could be possible for the defendant to deal with the suit land with third parties
or encumber it before the final disposal of the suit. However, as rightly observed
by the learned single Judge as well as Division Bench, if other reliefs which
we have already extracted above are granted, in the event of dismissal of a suit,
undoubtedly, it would create enormous difficulties for the defendant using the
plot or land freely and without any difficulty.
In other words, if the
appellant was allowed to proceed with the construction on the suit land, in the
event of dismissal of suit, the defendant cannot use the land in a different manner
with the structure without undertaking an enormous exercise of demolishing the same.
Further, what was claimed by the plaintiff was not a mere prohibitory order but
prayed for positive mandatory injunction which, as rightly observed by the
Division Bench, would permit the plaintiff to alter the status quo on the suit
land on the date of the suit.
12.
The
learned single Judge as well as Division Bench on appreciation of entire materials
rendered the factual finding that the balance of convenience is not in favour of
granting such mandatory interim order as claimed in prayer clauses (a) to (f).
It is relevant to
point out that though the appellant had stated that it had started construction
in the year 1996, even after the information by the defendant to the appellant
in 2002 that the BEST had given their `no objection' for the demolition of temporary
receiving station and the appellant can proceed with the demolition, however, the
fact remains, the height of the construction was only 80 ft. which shows that from
the year 2001 to 2007, the appellant had not carried on construction and there
was no obstruction from the side of the defendant.
In view of all these
factual aspects and in the light of the stand of the defendant disputing the existence
of the agreement, as rightly observed by the learned single Judge as well as
Division Bench, further permission for construction or ancillary works cannot
be granted during the pendency of the suit.
We are satisfied that
the learned single Judge was fully justified in granting limited relief in
respect of prayer clause (g) and declined the other reliefs in clauses (a) to
(f). The Division Bench was also fully justified in confirming the said limited
order. Though learned senior counsel for the respondent has prayed for certain
directions such as execution of a mortgage deed etc., for the same reasons mentioned
above, we are not inclined to grant such relief as claimed.
As observed earlier,
at this stage, it is not desirable to go into all the details and render a specific
finding which would undoubtedly affect the claim of both the parties in the
main suit. On the other hand, 1we are in entire agreement with the prima facie conclusion
arrived at by the learned single Judge and the Division Bench.
13.
Inasmuch
as, as early as on 25.04.2008, the learned single Judge directed hearing of the
suit be expedited, taking note of various other aspects/impediments highlighted
by both the parties including construction of a protection/security wall on the
sea side, we request the learned single Judge of the High Court to dispose of the
suit being No. 2618 of 2007 as early as possible preferably within a period of nine
months from the date of the receipt of the copy of this judgment. We also direct
both the parties to cooperate with the court for early conclusion of the
hearing as directed above.
14.
In
the light of the above discussion and reasonings, we find no merit in both the appeals,
consequently, they are dismissed with no order as to costs.
...............................................J.
(P. SATHASIVAM)
...............................................J.
(JASTI CHELAMESWAR)
NEW
DELHI;
NOVEMBER
14, 2011.
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