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2009 (4) TMI 984 - SUPREME COURT

2009 (4) TMI 984 - SUPREME COURT - TMI - Civil Appeal Nos.2186-2187 of 2009 - Dated:- 6-4-2009 - ALTAMAS KABIR AND CYRIAC JOSEPH JJ. JUDGMENT ALTAMAS KABIR, J. 1. Leave granted. 2. The appellant and the Respondent Nos.2 to 7 are owners of agricultural land in Survey No.36 measuring 32 acres and 38 gunthas situated in Village Nanamauva, Taluka & District Rajkot (hereinafter referred to as the suit land'). On 19th March, 1980, the appellant and the other joint owners of the suit land enter .....

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cted and according to the appellant and other joint owners, on the failure of the proposed Society to get such permission, the Agreement could not be performed and, therefore, by Public Notice dated 24th April, 1988, the Agreement was declared to have been cancelled. 3. A legal notice was received from one Sharad N. Acharya, Advocate, denying that the Agreement had been cancelled, as indicated in the Public Notice. Despite cancellation of the Agreement, the Respondent No.1 called upon the appell .....

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money of ₹ 1,81,000/- and for damages amounting to ₹ 16,30,670/- with interest @12% per annum. The Respondent No.1 also filed an application for interim injunction to restrain the appellant from entering into the said land and disturbing the possession of the Respondent No.1 and to further restrain the appellant from alienating the land to any third party. The Civil Court at Rajkot dismissed the said application by its order dated 29th April, 2002, against which the Respondent No.1 f .....

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t Appeal No.853/2008, along with an application, being Civil Application No.2405/2008, inter alia, to restrain the respondents therein from transferring or alienating the land in question to any third party till the disposal of the appeal. Since the appellant was on caveat before the High Court, after hearing the parties, the Division Bench of the Gujarat High Court admitted the appeal but did not grant any stay, as prayed for, and only directed that if the property in question was dealt with in .....

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e Gujarat High Court by the Respondent No.1 by way of an additional affidavit on the basis whereof, the High Court passed an order on 22nd April, 2008, directing that the property in question should not be sold. Thereafter, on 6th May, 2008, a further application for injunction No.5618/2008 was filed in the pending First appeal by the Respondent No.1 herein indicating that constructions were being raised on the land in question. On the basis of the above, the Division Bench of the Gujarat High C .....

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ity of litigations, we order that no construction be raised on the disputed land. In spite of our direction, if further construction is raised, the applicant will be at liberty to approach the concerned police authority, and the concerned police authority is also directed to take immediate steps to stop the construction on the disputed land. Civil application stands disposed of." 6. Appearing for the appellants, Mr. Mukul Rohtagi, submitted that the Respondent No.1, Maruti Corporation (plai .....

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mitted that none of the three orders impugned in the appeal were speaking or reasoned orders. As the orders would themselves reveal, they were simply reactions to new facts brought to the notice of the Court from time to time and orders were passed on the basis thereof without even giving the appellant herein or other interested parties a proper opportunity of meeting the allegations or questioning the same. Mr. Rohtagi submitted that the several interim orders passed by the Division Bench were .....

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f, for exemption and leave to construct on the vacant land. Learned counsel submitted that such application had been made by Tirupati Cooperative Housing Society, but the same was rejected and on such rejection, a public announcement was made discontinuing the agreement between the owners of the land and the proposed Tirupati Cooperative Housing Society. 8. Mr. Ranjit Kumar urged that the owners of the property had never entered into any agreement with Maruti Corporation-Respondent No.1 herein, .....

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of the Land Ceiling Act, 1976, on 19th March, 1999, that the Respondent No.1 filed the aforesaid suit seeking enforcement of an agreement alleged to have been entered into between the parties on 19th May, 1980, when exemption under Section 20 of the said Act was no longer required. 9. Mr. Ranjit Kumar submitted that initially when the First Appeal of the Respondent No.1 was admitted in the Gujarat High Court, an order was also passed in Civil Application No.2405 of 2008 to the effect that if the .....

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development permission sanctioned by the Rajkot Municipal Corporation. It was submitted that up to such point there could be no objection with regard to the orders passed in the First Appeal. Thereafter, when the interim order was modified on 22nd April, 2008, on the same application and the owners of the property were restrained from selling the same, the said modification, though not called for, was still capable of being defended. 10. The real problem was created when on 7th May, 2008, on a .....

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directed to take immediate steps to stop the construction on the disputed land. Mr. Ranjit Kumar emphasised that the cryptic manner in which the said application was disposed of by such a mandatory order, was contrary to all legal principles and even procedural law. He submitted that no liberty to deal with the fresh application filed on 16.5.2008 was even given by the Division Bench to the respondents in the appeal and on the very next day on 7th May, 2008, without even giving any reasons for p .....

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ted that the basic principles for granting injunction involving the making out of a prima facie case, the balance of convenience and inconvenience, and irreparable loss and injury, were not even taken into consideration when the orders of injunction were passed. 12. In addition to the above, Mr. Ranjit Kumar also referred to the decision of this Court in Mandali Ranganna & others vs. T. Ramachandra [(2008) 11 SCC 1] wherein an additional principle was sought to be enunciated relating to gran .....

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s 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. 13. Mr. Ranjit Kumar submitted that having filed the suit for enforcement of its purported rights under the Agreement of 1980 in the year 1999 and having allowed the owners of the property to deal with the same and certain rights having been created in favour of third parties when there was no restraint orders of the Courts, the High Court e .....

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at, on the other hand, the Respondent No.1 was in existence even in 1980, but as an unregistered partnership, and that it became a registered partnership on 21st June, 1989. Mr. Sorabjee submitted that the question of the existence of Maruti Corporation or the validity of the agreement executed between Maruti Corporation and the owners of the property would have to be considered on evidence and till a decision was arrived at in the matter, it was only appropriate that the status-quo of the prope .....

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ted raising their construction on the basis of such conveyances. 16. Mr. Sorabjee took pains to point out that while in the suit all the issues had been decided against the plaintiff, the issue relating to limitation had, however, been decided in favour of the plaintiff and it was held that the suit for specific relief was not barred by limitation. Mr. Sorabjee submitted that since the injunction order was in force since 7th May, 2008 and more than 10 months had passed since then, without distur .....

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in nature and could not, therefore, be acquired by any other body other than a cooperative society. It was on account of such bar that the Tirupati Cooperative Housing Society was proposed to be created on grounds of expediency and was yet to be registered. He also submitted that the payments made to the owners by Tirupati Cooperative Housing Society had been made from the account of Maruti Corporation and consequently when exemption under Section 20 of the Land Ceiling Act, 1976, was not grant .....

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rmance only after the said Act was repealed, thereby doing away with the necessity of obtaining exemption under Section 20 thereof. Mr. Ahmadi also contended that unless the appellant and the other joint owners of the property and their transferees were suitably restrained from dealing with the properties during the pendency of the two appeals before the first Appellate Court, the appeals would be rendered infructuous as it would become impossible once the constructions had come up, to revert ba .....

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ble loss on being restrained from developing their own property by the Respondent No.1, purportedly on the basis of a spurious document. Mixed with the aforesaid issues is the issue of the 280 transferees to whom plots have been conveyed by the owners and who were enjoying the same by raising structures which were at different stages of construction. We are faced with a situation where inspite of having obtained the said plots at a point of time when the injunction against the owners was not in .....

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he process of raising their constructions. As will be apparent from the order itself, the same was passed in great haste without even giving the owners of the lands an opportunity of contesting the application. In fact, the application was disposed of by a cryptic order which does not even contain any reason for passing the same. The Division Bench has merely indicated that to avoid further complications and multiplicity of litigation, the order was being passed not to raise constructions on the .....

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intervals by the Respondent No.1 Corporation. 21. The reasoning provided in the interim order dated 22nd April, 2008, is, to say the least, legally untenable. Having passed an order earlier on 29th February, 2008, based on the principle of lis pendens, the Division Bench of the High Court in its second order dated 22nd April, 2008, observed that when the First Appeal was admitted and the matter in dispute as regards the property in question was sub-judice, the properties in question should not .....

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hile passing the second and third interim orders dated 22nd April, 2008 and 7th May, 2008, nor has the High Court taken into account the long silence on the part of the Respondent No.1 Corporation in filing a suit after 19 years. 23. In our view, while passing the interim order dated 7th May, 2008, the High Court ought to have considered the effect which its order would have on the 280 transferees to whom some portions of the land had already been sold and who had commenced construction thereupo .....

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day without giving an opportunity of controverting the allegations made therein even to those who were parties in the suit, though it had been brought to the notice of the Court that conveyances had been executed in favour of 280 purchasers. This is not a case where the appellant and the other co-owners had violated any restraint order passed by the Court in transferring the plots in question to the said 280 transferees. The said transfers were effected at a point of time when there was no injun .....

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the other joint owners have been restrained from alienating by the second order dated 22nd April, 2008, are concerned, we are of the view that in the event the order of 22nd April, 2008, is set aside, the Respondent No.1 can be compensated in terms of money and no irreparable loss and injury will be caused to it on account thereof. On the other hand, if the owners of the property remain restrained from developing the same, it is they, who will suffer severe prejudice, as they will be deprived o .....

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