TMI Blog2006 (11) TMI 720X X X X Extracts X X X X X X X X Extracts X X X X ..... p of Companies including Ansal Properties and Industries Limited, defendant No. 1, and he held majority share with his brother, Shri Gopal Ansal. 3. A family settlement was arrived at among the brothers with the object of giving separate ownership, management and control of companies to each brother and consequently, plaintiff transferred all his shares in Ansal Properties and Industries Limited to Shri Sushil Ansal, defendant No. 2 and his nominee. 4. A restructuring plan was executed for net worth equivalisation of three flagship companies. The plaintiff contended that in 1988, defendant No. 1 proposed to construct a multi storey commercial building at plot No. B-148, Statesman House, Barakhamba road, New Delhi comprising of independent flats and in that building he agreed to buy a commercial flat No. GF-29 comprising of 250 sq.ft. @ Rs. 3,500/- per sq.ft. for a total consideration of Rs. 8,75,000/-.According to plaintiff, agreement to sell in respect of said flat is reflected and evidenced by the allotment letter dated 15th October, 1990 executed by the defendant No. 1 in favor of plaintiff in terms whereof defendants agreed to sell the said flat to the plaintiff. The plai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... April 2000, two awards dated 2nd December, 1999 and 22nd February 2002 have also been passed by the Group of Arbitrators named in Restructuring Agreement and even all the three brothers had written letters dated 20th December, 1999 indicating that the award given by the Arbitrator shall be binding on all the parties. 6. In these circumstances, the plaintiff filed the application for interim injunction contending that the defendants are apprehending illegal cancellation of allotment of the plaintiff and creating of third party interest in respect thereof. Consequent to the application of the plaintiff, an ex parte interim order dated 21st June, 2002 was passed restraining the defendants, their servants, agents, representatives, etc. from transferring, selling, alienating, mortgaging, handing over the possession or otherwise encumbering and creating third party interest in the flat in question. Thereafter, another application was filed seeking appointment of receiver to take possession of the said flat and to let out the property. That the flat of the plaintiff with other flats of his family members and the flats of his brother, Shri Gopal Ansal can fetch a substantial rental in e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of any immovable property. The defendant asserted that the rates per square feet were excluding of L DO and other charges and even the rate of Rs. 3,500/- per sq. ft. was not even fixed and was liable for enhancement/escalation. 9. In para 11 of the written statement, the defendant No. 1 gave the details of payments made by the plaintiff amounting to Rs. 8,75,000/-, however, it was asserted that the plaintiff did not make the payments in terms of the schedule. The defendants also claimed a sum of Rs. 2,54,780/- on account of electric connection charges; fire fighting charges; L DO charges; power back up charges; escalation charges; ground rent; vacant land tax and security deposits and a sum of Rs. 8,66,856/- as interest on delayed payment up to 31st May, 2002. Regarding the interest which was first demanded from the plaintiff by reply dated 5th June, 2002, defendants stated that the plaintiff was involved in the management of defendant No. 1 and was fully aware of the demands being made on persons similarly situated as the plaintiff for payment of various Installments. Since the entire payment has not been paid, no demand letter prior to 5th June, 2002 was given and plaintiff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Anr. V. Delhi Transport Corporation AIR1993Kant257 , B.R. Mulani V. Dr. A.B. Aswathabnarayana and Ors. to contend that there is no concluded agreement between the parties and the plaintiff is not entitled for appointment of a receiver nor for the injunction as prayed by him. 11. The plaintiff has refuted the pleas of the defendants and contended that since the past few years there have been disputes and differences between the three brothers in the Ansal family that is between the defendant No. 2, Mr. Sushil Ansal, and the other two brothers i.e. Mr. Deepak Ansal and Mr. Gopal Ansal created primarily by the defendant No. 2, to grab control and ownership of the various companies of the Ansal group so as to exclude and deprive his other two brothers. Though there have been two awards to resolve the various disputes and differences inter alias with regard to control and ownership of the Ansal Group of Companies but the defendant No. 2 who is the Chairman and in control of defendant No. 1 has been attempting to illegally and wrongfully frustrate the settlement with a view to deprive the other two brothers of their lawful right, control and ownership of the Ansal Group of compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the offer. There is also not doubt that the acceptance must be absolute and must correspond with the terms of the offer. If the two minds are not ad idem in respect of the property to be sold, there cannot be a contract for specific performance. 14. It is a question of construction whether the execution of the further contract is a condition or term of the bargain or whether it is a mere expression of the desire of the parties as to the manner in which the transaction already agreed will in fact go through. In M/s Pelican Estates Pvt. Ltd v. Kamal Pal Singh and Ors. 113 (2004) DLT 675 it was held that whether the alleged negotiations had remained inchoate or had fructified into consensus ad idem on all the ingredients necessary for the formation of a contract depends upon the intention of the parties and the special circumstances of each particular case. In the circumstance, can an inference be drawn from the facts and circumstances of this case that there was a concluded agreement not requiring any further written contract and that the parties were ad-idem in respect of all the terms and conditions between them which can be specifically enforced? In Rossiter v. Miller (1878) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the property with notice of the agreement of sale. 16. The Apex Court in [1990]2SCR350 , Mayawati v. Kaushalya Devi had held that the jurisdiction to order specific performance of a contract is based on the existence of a valid and enforceable contract. Where a valid and enforceable contract has not been made, the Court will not make a contract for the parties and the specific performance will not be ordered if the contract itself suffers from some defect which makes the contract invalid or unenforceable. It was rather held that even if the contract is valid and enforceable, the discretion of the Court will be there to pass or not to pass a decree of specific performance but if the stipulation and terms are uncertain, and the parties are not ad idem, there can be no specific performance, for there was no contract at all. Where there are negotiations, the Court has to determine at what point, if at all, the parties have reached. It was observed by the Supreme Court: 8...The jurisdiction to order a specific performance of a contract is based on the existence of a valid and enforceable contract the law of contract is based on the ideal of freedom of contract and it provides th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he facts of the case. It is necessary first to see whether there has been a valid and enforceable contract and then to see the nature and obligations arising out of it? Whether the intention of the offeree to accept the offer was express without leaving room for doubt as to the fact of acceptance or to the coincidence of the terms of acceptance with those of the offer? Was this acceptance absolute and corresponded to the terms of the offer? Whether the two parties were or were not at ad-idem in respect of the terms of the sale of the property? If parties are themselves are not ad-idem regarding the sale of the property, the Court cannot order specific performance and if the Court cannot order specific performance the Court should not pass any interim order in such facts and circumstances. 18. Both the parties have relied on a number of judgments in support of their contentions and pleas. Considering the present facts and circumstances, it may not be necessary to deal with all the cases sited by the parties in detail at this interim stage as the fact situation of the present case is apparently distinguishable from the fact situation of the decisions relied on behalf of parties. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overned and qualified by the particular facts of the case in which such expressions are to be found. The other is that a case is only an authority for what it actually decides. I entirely deny that it can be quoted for a proposition that may seem to follow logically Page 2009 from it. Such a mode of reasoning assumes that the law is necessarily a logical Code, whereas every lawyer must acknowledge that the law is not always logical at all. In Ambica Quarry Works v. State of Gujarat and Ors. the Supreme Court observed: The ratio of any decision must be understood in the background of the facts of that case. It has been said long time ago that a case is only an authority for what it actually decides, and not what logically follows from it. Similarly in Bhavnagar University v. Palitana Sugar Mills Pvt Ltd AIR2003SC511 , the Supreme observed: It is well settled that a little difference in facts or additional facts may make a lot of difference in the precedential value of a decision . 19. Circumstantial flexibility, one additional or different fact may make a world of difference between conclusions in two cases. Disposal of cases by blindly placing reliance on a decis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount then what could be expected by them would enjoy the possessory benefits of the flats. Regarding appointment of a receiver a Single Judge of the Bombay High Court in Syed Khuwaja Syed Ahmed (supra) had held that it must be determined not only on the facts of a particular case but also in the context of a social situation. In this case the plaintiff was one of the occupants of an old building which had crumbled down and he had been given an alternative accommodation though the building had been reconstructed by the authority. The plaintiff in this case was an occupant of the old building and his grievance was that he had not been given alternative accommodation. Since a flat was lying vacant and an application was filed by the plaintiff in that case to appoint him as a receiver and hand over the possession of the flat, it was held that the condition of justness and convenience has to be appreciated not only with reference to the facts of each case but also in the context of social situation. Since the flat was lying idle and the plaintiff was suffering and did not have even a small nook to rest his limbs it was held to be eminently just and convenient to appoint a receiver and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... danger is an important consideration. A Court will not act on possible danger only, the danger must be great and imminent demanding immediate relief. It has been truly said that a Court will never appoint a receiver merely on the ground that it will do no harm. 4) An order appointing a receiver will not be made when it has the effect of depriving a defendant of a 'de facto' possession since that might cause irreparable wrong. If the dispute is as to title only, the Court very reluctantly disturbs possession by receiver, but if the property is exposed to danger and loss and the person in possession has obtained it through fraud or force the Court will interpose by receiver for the security of the property. It would be different where the property is shown to be 'in medio' that is to say, in the enjoyment of no one, as the Court can hardly do wrong in taking possession: it will then be the common interest of all the parties that the Court should prevent a scramble as no one seems to be in actual lawful enjoyment of the property and no harm can be done to anyone by taking it and preserving it for the benefit of the legitimate who may prove successful. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied on Surinder Sethi (Supra) where it was held in a suit for specific performance, where the agreement to sell has a stipulation that in case of default on the part of seller, double the money would be payable, prima facie case for injunction was not made out as the damages had already been liquidated and specially since the relief of specific performance is discretionary in nature. In Rajeshwar Nath Gupta (Supra) a Single Judge had held in the facts and circumstances that the defense raised by the defendants on the face of it was not wholly tangible and so wherever there is a bonafide defense which has been set up and where the proposition of law is arguable it is not advisable for the Court to appoint a receiver to take possession of immovable property from the defendants unless and until the Court is of the opinion that there is well founded fear that the property in question will be dissipated or that other irreparable mischief may be done unless the Court gives a protection. If more than a prima facie case is made out by the plaintiff to the likelihood of the suit being decreed and there is no tangible defense raised by the defendants and in case manifest injustice would be d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isputed by the defendants as no rate or area of the flat was given in the receipt. In Jiwan Dass Rawal v. Narain Dass and Ors (supra) relied on by the defendant it was observed that whereas in England an agreement of sell creates an equitable estate in the purchaser, however, the law in India does not recognize any such estate. Section 54 of the Transfer of Property Act in specific terms provides that a contract for sale does not, of itself, create any interest in or charge on such property. In this case the disputes had arisen under an agreement to sell. 24. The plaintiff is claiming rights in the property on the basis of allotment letter issued to him. The Defendants have, however, filed the documents showing that agreements to sell were executed with other allottee of spaces in the same building. The allotment letter also stipulates that the allotment is provisional by the builder who is responsible and not the owners in any manner whatsoever. The allotment letter also stipulates that the rates per sq. feet mentioned for the flat are exclusive of L DO charges and other charges mentioned in the allotment letter. The agreement to sell executed in respect of other allotters rath ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to have been finalised between them and whether they intended that the matter was closed and concluded between them. 26. In Baijnath (Supra) a Division Bench had declined specific performance of part of an agreement by handing over hall to the plaintiff purchaser on 13th floor of a building as the agreement was contingent on sanction of the plan of that floor by the authority. In Shamjibhai and others (Supra) a Division Bench of Nagpur High Court had held that in contracts for sale of land, there are three well defined stages and it is always a matter for construction when these three stages are present as to which the parties intended to be the crucial stage at which both sides are to be bound. These three stages were defined as period of negotiation in which suggestions and counter suggestions are handled to and fro and thereafter second stage is reached when this stage is concluded and the parties reach an agreement and the parties can reduce their points of agreement in writing and can draw a formal agreement and execution of the formal document is the third stage. 27. Though the plaintiff has contended that he has always been ready and willing to perform his part of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 1 has produced various agreements to sell of other allottees to show that other allottees were given possession on execution of Agreements to sell in their favor on payment of amounts demanded by the defendant No. 1. The plaintiff can not contend prima facie that he was not aware of these facts and circumstances. The disputes are whether the allotment letter is a concluded agreement to sell in favor of the plaintiff and other disputes which have been raised by the defendants. On considering these facts and circumstances, prima facie, the plaintiff is not entitled for an interim mandatory injunction directing the defendants to give possession of the property to the plaintiff. 29. In Purshottam Vishindas Raheja (supra) a Single Judge in a suit for specific performance of the agreement to sell had held that the plaintiff does not get the right of possession unless he gets a decree and a defendant Therefore, cannot be dispossessed at an interlocutory stage. Another Single Judge of this Court in Hari Mohan Sharma (supra) on the undertaking of the defendant that he will maintain status quo in respect of the property for which the suit for specific performance of agreement to sell wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rety of the facts and circumstances and various orders passed by this Court, prima facie, the plaintiff has not been able to make out a case for taking possession of the flat in dispute from the defendants and for appointment of the receiver and for letting out the same. 30. The plaintiff was granted ex-parte interim injunction restraining defendants from transferring, selling, mortgaging or encumbering third party interest in the flat by order dated 21.6.2002. Considering the fact that plaintiff was the Director of the defendant No. 1 company and allotment of the flat is alleged to have been on account of restructuring plan for net worth equivalisation of different companies and the fact that the consideration except the L DO charges and other charges and interest has been paid, in case the defendants create third party rights in the said property or encumber the same by creating any mortgage or sale, will cause greater inconvenience to the plaintiff than to the defendants. In the circumstances plaintiff shall suffer irreparable loss and damages and the inconvenience caused to the plaintiff shall also be greater. Therefore, it will be just and appropriate to restrain the defend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e public and which is listed in the stock exchange and all policy decisions are taken by the Board of Directors of defendant No. 1 which also has the nominee of the banks and financial institutions. In these circumstances it has been claimed that the plaint be rejected against defendant No. 2. 34. The application is contested by the plaintiff/non applicant. It was asserted by the non applicant that the pleas have been raised in the plaint against defendant No. 2 who was aware of the contract in respect of which specific performance is sought and non performance of contractual obligations in respect of the agreement to sell are solely on account of and at the behest of defendant No. 2. It is asserted that there are disputes between the defendant No. 2 on one side and his brothers including plaintiff on the other side and specific allegations have been made in paragraphs 35 to 42 of the plaint which disclose an ample cause of action against defendant No. 2 and in the circumstances defendant No. 2 is a necessary and in any case a proper party and plaint is not liable to be rejected against defendant No. 2. 35. Perusal of the plaint discloses that specific averments have been mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ltimately on the basis of the pleas and evidence produced by the plaintiff whether he would be entitled for a decree or not is not material for adjudicating whether the plaintiff is a necessary party or not. plaintiff is also a dominus lIT is and he is entitled to sue every possible adverse claimant in the same suit whom he wishes to proceed to avoid multiplicity of suit and needless expenses. plaintiff is entitled to join all the persons as defendants against whom right to relief is alleged or exist. A party can be joined as defendant even though the plaintiff does not think that he has any cause of action against him as it is open to the Court to add at any stage of the suit, a necessary party or a person whose presence before the Court may be necessary in order to enable the Court to effectually and completely adjudicate upon and settle all the questions involved in the suit. 39. Rejection of a plaint is a serious matter as it non suits the plaintiff and kills the cause of action. It cannot be arrived cursorily without satisfying the requirement of the settled provisions of Code of Civil Procedure. For adjudication of rejection of plaint, averments made in the plaint only hav ..... X X X X Extracts X X X X X X X X Extracts X X X X
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