2011 (4) TMI 1546 - HC - Indian Laws

Summary

Issues Involved:
1. Interpretation of the judgment in Kachhi Properties, Satara v. Ganpatrao Shankarrao Kadam.
2. Applicability of Section 52 of the Transfer of Property Act, 1882.
3. Right of impleadment of transferee pendente lite.
4. Adequacy of protection under Section 52 of the Transfer of Property Act, 1882.
5. Power of the Court to grant temporary injunction under Order XXXIX of the Code of Civil Procedure, 1908.
6. Consequences of alienation in violation of temporary injunction.
7. Jurisdiction and powers of the Appellate Court under Clause (r) of Rule 1 of Order XLIII of the Code of Civil Procedure, 1908.

Detailed Analysis:

1. Interpretation of the Judgment in Kachhi Properties, Satara v. Ganpatrao Shankarrao Kadam:
The judgment in Kachhi Properties was central to the appeals, raising issues about the power of the Court to grant temporary injunctions to restrain a Defendant from creating third-party interests in respect of the suit property. The High Court examined whether Section 52 of the Transfer of Property Act, 1882, affects the power of the Court to grant such temporary injunctions. The Court concluded that while Section 52 provides some protection, it may not always be adequate, and temporary injunctions can be warranted to prevent irreparable loss.

2. Applicability of Section 52 of the Transfer of Property Act, 1882:
Section 52 deals with the transfer of property pending litigation. The Court noted that in Mumbai, the amended Section 52 requires the registration of notice of lis pendens under Section 18 of the Indian Registration Act, 1908. However, this amended section is only applicable to properties in Mumbai and not to other parts of Maharashtra unless a notification is issued. The Court emphasized that Section 52 does not render a transfer pendente lite illegal or void but binds the transferee to the outcome of the litigation.

3. Right of Impleadment of Transferee Pendente Lite:
The Court referred to the Supreme Court's decision in Amit Kumar Shaw v. Farida Khatoon, which held that a transferee pendente lite can be impleaded under Order I Rule 10 and Order XXII Rule 10 of the Code of Civil Procedure. The transferee is vitally interested in the litigation and is bound by the decree passed in the suit. Therefore, the Court recognized the right of impleadment of such transferees, contrary to the observation in Kachhi Properties that they cannot claim impleadment.

4. Adequacy of Protection Under Section 52 of the Transfer of Property Act, 1882:
The Court found that Section 52 does not provide absolute protection to the parties from transfers pendente lite. The power to grant temporary injunctions under Order XXXIX of the Code of Civil Procedure is discretionary and can be exercised if the protection under Section 52 is deemed inadequate. The Court referred to the Supreme Court's decision in Maharwal Khewaji Trust v. Baldev Das, which emphasized maintaining the status quo during litigation to prevent irreparable loss and multiplicity of proceedings.

5. Power of the Court to Grant Temporary Injunction Under Order XXXIX of the Code of Civil Procedure, 1908:
The Court reiterated that the power to grant temporary injunctions is discretionary and should be exercised based on the existence of a prima facie case, irreparable loss, and balance of convenience. The Court can grant temporary injunctions to prevent alienation if these conditions are met, regardless of the protection provided by Section 52.

6. Consequences of Alienation in Violation of Temporary Injunction:
The Court distinguished between the effects of Section 52 and a prohibitory injunction. While Section 52 does not render a transfer illegal or void, a transfer made in violation of a temporary injunction is illegal and confers no right, title, or interest on the transferee. The offending party may face serious consequences under Rule 2A and Rule 11 of Order XXXIX of the Code of Civil Procedure.

7. Jurisdiction and Powers of the Appellate Court Under Clause (r) of Rule 1 of Order XLIII of the Code of Civil Procedure, 1908:
The Court noted that its powers while dealing with an appeal under Clause (r) of Rule 1 of Order XLIII are limited. The Appellate Court cannot interfere with the trial court's order unless it is perverse. In this case, the trial court's decision to deny the temporary injunction was based on relevant grounds and was not perverse, so the appeal was dismissed.

Conclusion:
The High Court dismissed Appeal from Order No. 884 of 2010, confirming the trial court's decision to deny temporary injunction. The Court admitted Appeal from Order No. 857 of 2010 and expedited the hearing of the suit, emphasizing that the trial court's decision should not be influenced by the tentative observations made in the interim orders. The judgment clarified the applicability and limitations of Section 52 of the Transfer of Property Act, 1882, and the discretionary power of courts to grant temporary injunctions.