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Man Singh and anr. Vs. Shri H.S. Kohli (Harbhajan Singh Kohli) and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty;Civil
CourtPunjab and Haryana High Court
Decided On
Case NumberCivil Revision No. 3797 of 1995
Judge
Reported in(1997)115PLR643
ActsCode of Civil Procedure (CPC) , 1908 - Sections 115 - Order 39, Rules 1 and 2; Transfer of Property Act, 1882 - Sections 54; Specific Relief Act - Sections 41
AppellantMan Singh and anr.
RespondentShri H.S. Kohli (Harbhajan Singh Kohli) and ors.
Appellant Advocate Ashok Aggarwal, Sr. Adv. and; Amit Rawal, Adv.
Respondent Advocate L.M. Suri, Sr. Adv. and; Deepak Suri, Adv. for Respondent Nos. 1 to 3,;
Cases Referred(Man Singh and Anr. v. H.S. Kohli and Ors.). The
Excerpt:
.....& rajesh bindal, jj] alienation of coparcenary property - law laid down by full bench in joginder singh kundha singh v kehar singh dasaundha singh [air 1965 punjab 407] and pritam singh v assistant controller of estate duty, patiala [1976 punj lr 342] -whether there is any conflict? - held, the basic controversy in the full bench decision of joginder singhs case was regarding constitutional validity of section 14 of hindu succession act and as to whether it infringes article 14 of constitution. it was held that the estate held by male and limitation on his power of alienation were in no way removed and the reversioners were not debarred from challenging such alienations. the full bench held that section 14 of hindu succession act postulates that estate held by a hindu female before..........so and hence the suit. along with the suit the plaintiffs prayed that during the pendency of the suit defendants nos. 1 to 3 be restrained from alienating in any manner or changing the nature of the property in any manner and defendant no. 4 be also restrained from raising any construction or changing the nature of the property.3. notice of the application was given to the defendants. defendants nos. 1 to 3 filed a separate reply and their stand is that the suit of the plaintiffs is barred under section 41 of the specific relief act, 1963 as they have other efficacious remedy. no injunction can be granted to the plaintiffs who have not approached the civil court with clean hands and have tried to mislead the court. there was no legal and valid contract which came into existence between.....
Judgment:

R.L. Anand, J.

1. By this judgment I dispose of two Civil Revision Nos. 3079 of 1995 (Harbans Singh Kohli and Ors. v. Man Singh and Ors.), and 3797 of 1995 (Man Singh and Anr. v. H.S. Kohli and Ors.) as both these revision petitions have arisen from one judgment dated 7th June, 1995, passed by the Court of District Judge, Ludhiana, who partly accepted the appeal of the plaintiffs (petitioners of C.R. No. 3797 of 1995) and allowed in part the application under Order 39 Rules 1 and 2, C.P.C., filed by the plaintiffs Man Singh and Paramjit Singh Bhatia, who are the petitioners of C.R. No. 3797 of 1995, and granted temporary injunction in their favour restraining the sale of 1292 equity shares of the land measuring 1200 sq. yards till the disposal of the suit against the defendants, i.e., H.S. Kohli; H.S. Kohli and Sons - H.U.F. Firm; Smt. Arvinder Kaur Kohli and M/s Preet Builders Private Limited. It may be mentioned here that defendants Nos. 1 to 3 aforesaid have filed a separate Civil Revision No. 3079 of 1995 against the aforesaid judgment of the learned District Judge and had prayed for the dismissal of the application under order 39 Rules 1 and 2, C.P.C., of the plaintiffs Man Singh and Paramjit Singh Bhatia.

2. The brief facts of the case are that, according to the plaintiffs, defendant No. 1 i.e. H.S. Kohli made a representation to the plaintiffs to believe that he is the Managing Director of Khalsa Nirbhai Transport Company Pvt. Ltd., Ludhiana, and Karta of H.U.F. of H.S. Kohli & Sons defendant No. 2 and general attorney of Smt.Arvinder Kaur defendant No. 3 and as such is competent to enter into an agreement for the sale of 1523 equity shares of Rs. 100/- each and also is competent to transfer the property Measuring 1200 sq. yards, fully described in the head-note of the plaint, situated in Ludhiana city. On this representation by defendants Nos. 1 to 3 through defendant No. 1, the plaintiffs entered into an agreement for the purchase of 1523 equity shares of Rs. 100/- each fully paid-up for a total consideration of Rs. l,73,00,000/-, at the rate of Rs. 11360/- per equity share of Rs. 100/-. The plaintiffs and defendants Nos. 1 to 3 entered into an agreement for the purchase of 1523 equity shares of Rs. 100/- each and the agreement was reduced into writing at the instance of the parties. The plaintiffs paid Rs. 35 lacs by way of earnest money to defendants Nos. 1 to 3. As per terms of the agreement Rs. 10 lacs were to be paid on the vacation of the shop occupied by M/s Amar Tyres. The balance payment of Rs. 1,28,00,000/- was to be made on the delivery of the possession of the premises bearing No. B.VII-755(old) and B.VII-1083 (new). The time of payment by the party of the second part was 30 days from the date of the intimation by the party of the first part to the party of the second part. In lieu of payment of Rs. 46 lacs by the plaintiffs to defendants Nos. 1 to 3 the vendors agreed to transfer the property i.e. 310 equity shares of Rs. 100/- each fully paid up on or before 31st August, 1993. The balance of the equity shares of the abovesaid company was agreed to be transferred on the payment of Rs. 1,28,00,000/- only. It was also agreed that the party of the second part would give 2000 sq.ft. of the area free of costs on the first floor, if lift is not installed, otherwise, if the lift is installed, then on the floor below the last floor to the party of the first part on the completion of the construction of the premises. It was also agreed that the sale deed/ lease deed would be executed by the abovesaid company of 360 sq. yards on the plot in favour of M/s R.K.Hotels. The plaintiffs alleged that they were ready and willing to perform their part of the contract and had got the balance sale consideration with them, but defendants Nos. 1 to 3 did not give any intimation to them regarding the vacation of the premises by M/s R.K.Hotels as the 49 shares owned by Satnam and Family and a shop were to be purchased/got transferred by Shri H.S.Kohli defendant No. 1 in his name and then to be transferred to the plaintiffs along with the land and further 182 equity shares of Rs. 100/- each. The plaintiffs have got a right to claim an injunction against defendants Nos. 1 to 3 restraining them from alienating or transferring the fully paid up equity shares of Khalsa Transport Company; and the plaintiffs have also the right to file a suit for injunction. The plaintiffs since have paid a sum of Rs. 35 lacs by way of earnest money in the presence of Subhash Malhotra and Sham Sunder Malhotra and Sh. R.N. Sehgal, Advocate, on 10.7.1993. There was a public notice published in the daily Punjab Kesri, Jalandhar, on 14.9.1994, and daily Jagbani, Jalandhar on 15.4.1994, by one Surinder Singh claiming that he is the owner of the property. After the agreement dated 10.7.1993 executed by defendants Nos. 1 to 3 in favour of the plaintiffs, these defendants cannot lease, transfer or mortgage or damage or demolish the property agreed to be sold in favour of the plaintiffs, nor these persons had any right to construction on the said property. The plaintiffs called upon defendants Nos. 1 to 3 and defendant No. 4 M/s Preet Builders through its Managing Director Shri Avtar Singh not to dig foundations and change the user of the property by making any alterations or additions but they have not desisted from doing so and hence the suit. Along with the suit the plaintiffs prayed that during the pendency of the suit defendants Nos. 1 to 3 be restrained from alienating in any manner or changing the nature of the property in any manner and defendant No. 4 be also restrained from raising any construction or changing the nature of the property.

3. Notice of the application was given to the defendants. Defendants Nos. 1 to 3 filed a separate reply and their stand is that the suit of the plaintiffs is barred under Section 41 of the Specific Relief Act, 1963 as they have other efficacious remedy. No injunction can be granted to the plaintiffs who have not approached the Civil Court with clean hands and have tried to mislead the Court. There was no legal and valid contract which came into existence between the plaintiffs and defendants Nos. 1 to 3. The plaintiffs have forged and fabricated the agreement by putting the signatures of Paramjit Singh Bhatia and the witnesses. No consideration of Rs. 35 lacs was ever passed to the replying defendants. No witness was present at the time of the signing of the agreement between the answering defendant Harbans Singh Kohli and plaintiff Man Singh. The plaintiffs were informed vide letter dated 5.1.1994 that they had not paid the amount of Rs. 35 lacs as promised and a period of more than six months has already lapsed and the plaintiffs had committed the breach of the understanding. There was no question of transfer of any share on or before 31.8.1993. No notice under U.P.C. was ever received by the defendants. The property in question is owned by M/s Khalsa Nirbhai Transport Co. Pvt. Ltd., Ludhiana, and it had been leased out to M/s Preet Buildings Pvt. Ltd., i.e. defendant No. 4, and the said lessee is in possession of the property in terms of the lease deed dated 4.3.1994. It was also pleaded by these defendants that they had every right to deal with their share of the property.

4. Respondent/defendant No. 4, i.e. M/s Preet Builders filed a separate reply and its stand was that the property in dispute belonged to M/s Khalsa Nirbhai Pvt. Ltd. It is the company which could enter into an agreement with any person but the plaintiffs-alleged that they entered into an agreement with Harbans Singh Kohli and Smt. Arvinder Kaur only in their personal capacity. These two persons were not entitled in their own name to enter into any such agreement. The company, which is the owner of the property, has not entered into any agreement with the plaintiffs. On the face of it no valid or legal agreement came into existence nor such agreement is in force. M/s Khalsa Nirbhai Transport Co, has leased out the entire property in favour of respondent No. 4. This property was earlier in the possession of M/s. Kohli Builders, who vacated the same and a sum of Rs. 1,25,000/- was paid to it through cheques as compensation for vacating the property. After taking the possession defendant-respondent No. 4 has demolished the entire upper floor and got vacant possession from M/s Amar Tyres after making payment of Rs. 25,000/-. Building material and concerned machinery is lying and standing at the spot and construction work is going on and big pillars have already been constructed in the open portion. Approximately Rs. 20,00,000/ have already been spent and material worth several lacs is lying at the spot which would go waste in case the injunction as prayed for is allowed to the plaintiffs on the basis of the alleged agreement dated 10.7.1993.

5. The parties placed documents before the trial Court and vide order dated 21.12.1994 the trial Court dismissed the application of the plaintiffs under Order 39 Rules 1 and 2, C.P.C., by holding that there was no prima facie case in their favour and that they shall not suffer irreparable loss in case ad interim injunction is not granted to them. It was also held that balance of convenience lies in favour of the defendants rather than the plaintiffs. Finally the application was dismissed. Unsuccessful plaintiffs, i.e. petitioners of C.R. No. 3797 of 1995, namely, Man Singh and Paramjit Singh Bhatia filed appeal against the order of the trial Court in the Court of District Judge, Ludhiana, who vide order dated 7.6.1995 partly allowed the appeal and the application under Order 39 Rules 1 and 2, C.P.C., of the plaintiffs and granted stay order against the defendants-respondents, restraining the sale of 1292 equity shares and the land measuring 1200 sq. yards, till the disposal of the suit. However, the learned District Judge declined to give any injunction regarding the digging or raising of any construction on the land measuring 1200 sq.yards. Similarly, no injunction regarding the transfer of 231 equity shares was issued. Aggrieved by the decision dated 7.6.1995 of the District Judge, Ludhiana, Civil Revision No. 3079 of 1995 has been filed by defendants Nos. 1 to 3, and C.R. No. 3797 of 1995 has been filed by the plaintiffs.

6. I have heard Shri L.M. Suri, Senior Advocate on behalf of the petitioners in C.R. No. 3079 of 1995, Shri Ashok Aggarwal, Senior Advocate, on behalf of respondents Nos. 1 and 2, and Shri M.L. Sarin, Senior Advocate, on behalf of M/s Preet Builders (respondent No. 3) in the said civil revision. Naturally, Sh. Ashok Aggarwal, Senior Advocate, has been heard in support of his revision petition No. 3797 of 1995 and this revision petition has been contested by Shri L.M. Suri, Senior Advocate, and Shri M.L. Sarin, Senior Advocate, and with their assistance have gone through the record of this case.

7. Shri L.M. Suri in support of his Civil Revision No. 3079 of 1995 submitted that the learned lower appellate Court, i.e., District Judge, Ludhiana, gravely erred in partly allowing the application as the suit of the plaintiffs Man Singh and Paramjit Singh Bhatia which was for permanent injunction, was not legally maintainable and the said suit was barred under the provisions of Specific Relief Act. These plaintiffs' had equally efficacious remedy and. they ought to have filed a suit for possession by way of specific performance and for non-adoption of the equally efficacious remedy by them, no relief of temporary injunction can be granted in a suit for permanent injunction which is not legally maintainable. It was also submitted by Shri Suri that the basis of the claim of the plaintiff is the agreement dated 10.7.1993. Firstly the execution of the agreement is in dispute and even if it is assumed for the sake of argument that there is life in the agreement dated 10.7.1993, still it does not confer any title or interest on the plaintiffs because it is well settled that the agreement of sale does not convey any interest in favour of the vendees. Shri M.L. Sarin, learned cousel who appeared on behalf of M/s Preet Builders Pvt. Ltd. was also interested in the dismissal of the application under Order 39 Rules 1 and 2, C.P.C., and he relied upon the provisions of Section 115 of the C.P.C., and urged that the order of the learned District Judge could not be sustained in the eyes of law because the Court did not reverse the findings given by the trial Court to the effect that the plaintiffs had no prima facie case to succeed; that the balance of convenience does not lie in their favour and that they would suffer irreparable loss. Till such findings are given by the lower appellate Court, the order of the trial Court could not be set aside. Also it was submitted that as per provisions of Section 54 of the Transfer of Property Act, the plaintiffs are not conferred with any title with respect of the property in dispute and on the contrary M/s Preet Buildings are the lessees under a registered lease deed which tantamounts to transfer of interest in the immovable property and his client has also invested lacs of rupees by putting building material at the site for the construction of the building complex. Also it was submitted by Shri Sarin that 231 shares have been acquired by his client out of the total 1523 equity shares and in this manner his client has become a co-sharer and the law is well settled that no injunction can be granted against a co-sharer in favour of a co-sharer.

8. Shri Ashok Aggarwal, Senior Advocate, who appeared on behalf of the plaintiffs, in support of his revision petition No. 3797 of 1995 urged that the suit of his client was legally maintainable when it was instituted because out of 1523 shares, the vendor had yet to acquire 231 shares and a suit for specific performance for piecemeal property could not be instituted. Secondly the agreement in favour of M/s Preet Builders is subsequent to the agreement dated 10.7.1993. The second agreement is dated 1.12.1993. The so called registered lease deed is dated 4.3.1994 and in these circumstances M/s Preet Builders and respondents Nos. 1 to 3 in C.R. No. 3797 of 1995 cannot defeat the rights of the plaintiffs, i.e., Man Singh and Paramjit Singh Bhatia. It was also submitted by Shri Aggarwal that on coming to know that respondents Nos. 1 to 3 had perfected their title after the execution of the agreement, his clients had already moved an application under Order 6 Rule 17, C.P.C., for converting the suit into a suit for specific performance and the application has not been disposed of so far. The counsel submitted that the conduct of the four respondents is such that they are joining together in order to defeat the rights of his clients, i.e., the plaintiffs and these defendants-respondents should not be permitted to do so. Finally it was also submitted by Shri Ashok Aggarwal that the application under Order 39, Rules 1 and 2, C.P.C., ought to have been allowed by the learned District Judge in its entirety and not in part as it would further lead to multiplicity of suits. There are every chances that the respondents Nos. 1 to 4 may construct the building/residential complex over the property and may sell the same to different persons and in this manner the rights of third persons would come into play. In order to avoid the multiplicity of the suits the application under Order 39 Rules 1 and 2, C.P.C., should have been allowed by the lower appellate Court and the relief which has been declined to his clients has not been granted on legal premises.

9. After considering the rival contentions of the pa ties, I am of the considered view that Civil Revision No. 3797 of 1995 filed by the plaintiffs is devoid of any merit while Civil Revision No. 3079 of 1995 filed by the defendants deserves to be allowed and the order, dated 7.6.1995 passed by the learned District Judge, Ludhiana, cannot be sustained in the eyes of law and the application under Order 39 Rules 1 and 2, C.P.C., filed by the plaintiffs-petitioners of C.R. No. 3797 of 1995 should be dismissed in its entirety and the order of the learned Sub Judge should be restored. I will deal with the case law cited at the bar by the learned counsel for the parties at a subsequent stage of this judgment but at the first instance I may make a mention that in order to succeed in an application under Order 39 Rules 1 and 2, C.P.C., the applicant must prove that he has a prima facie case to succeed; the balance of convenience lies in his favour; and. that he would suffer irreparable injury in case the injunction is not granted. Also it is the law that all the three ingredients should coexist before a relief of temporary injunction can be allowed.

10. In the present case the basis of the suit of the plaintiffs was the agreement dated 10.7.1993. As per Section 54 of the Transfer of Property Act a mere agreement of sale does not confer any right, title or interest in favour of the vendees. Firstly it is a disputed point whether this agreement dated 10.7.1993 has come into existence under a proper form or not. Admittedly this property and the equity shares belong to M/s Nirbhai Transport Co. which is a limited one. It is a legal entity which can only act through its Board of Directors. It is to be seen whether there was any valid resolution by the Board of Directors of the Company authorising Mr. H.S. Kohli to enter into any agreement with the plaintiffs. It is also a disputed point whether any consideration under the agreement had validly passed in favour of the original owners or not. Thirdly if all the odds are taken in favour of the plaintiffs regarding the due execution of the agreement and the ownership of the property, still it will be seen whether non-performance of the contract can provide with an adequate compensation to the plaintiffs or not. I am of the considered view that the basis of the suit, i.e., the agreement dated 10.7.1993, does not confer any right, title or interest in the property to the plaintiffs, but the right to sue for specific performance in case defendants Nos. 1 to 3 had committed the breach thereof. In these circumstances the remedy which lies with the plaintiffs is to file a suit for specific performance and not a suit for injunction. According to Section 41 of the Specific Relief Act the relief of injunction would be refused when equally efficacious remedy can certainly be obtained by any other usual mode of proceedings. The application under Order 6 Rule 17, C.P.C., which has been filed by the plaintiffs has not been allowed so far by the trial Court and it is not certain whether the same would be allowed or not and when the order of the trial Court with regard to the disposal of the application under Order 6 Rule 17, C.P.C., shall become final. Assuming for the sake of argument, had the plaintiffs filed the suit for specific performance on the basis of the agreement dated 10.7.1993, still the relief of injunction in the present case should not be granted to them because respondent No. 4 can successfully defeat the suit by showing that it is a bona fide transferee for consideration and had no knowledge of the earlier agreement dated 10.7.1993, relied upon by the plaintiffs. If the agreement dated 10.7.1993 at any stage is held to be enforceable and respondent No. 4 is held not to be a bona fide transferee, still this defendant would be bound by the ultimate decree which may be passed in favour of the plaintiffs. Thus from both the angles the plaintiffs had no prima facie case so that the relief of temporary injunction can be granted to them.

11. Even the balance of convenience does not lie in favour of the plaintiffs. The possession of the disputed property is admittedly with respondent No. 4, who had entered into an agreement dated 1.12.1993. By virtue of registered lease deed dated 4/7.3.1994 the possession had gone to him. In these circumstances it cannot be said that balance of convenience lies in favour of the plaintiffs.

12. It is the case of contesting respondent No. 4 that it had dumped on the site the building material worth lacs of rupees and in case the construction is stopped or this respondent is restrained from exercising its right under the agreement, it would suffer irreparable injury. The learned lower appellate Court while allowing the application in part has held finally in para No. 14 of the judgment that the questions which could have been raised by the parties required trial in the suit being quite serious in nature and the suit cannot be thrown at the outset. In my opinion, the learned District Judge has not rightly appreciated the controversy involved in the suit. Contentious averments/counter averments alleged and denied by the parties in the present case make a good case for the declining of the application under Order 39, Rules 1 and 2, C.P.C., because the first hurdle regarding the prima facie case has not been crossed successfully by the petitioners of C.R. No. 3797 of 1995, i.e. the plaintiffs. The learned trial Court rightly appreciated the controversies between the parties by holding that it is a point to be seen with suspicion that the agreement dated 30.7.1993 has not been validly executed because admittedly the property belonged to M/s Khalsa Nirbhai Transport Co. and could not be alienated by Shri H.S. Kohli by entering into the alleged agreement. Also it was correctly concluded by the trial Court that some of the shares were yet to be acquired by Mr. Kohli and it was his discretion to acquire those shares or not. The trial Court again rightly appreciated the controversy when it held that the principles of lis pendense as enshrined under Section 52 of the Transfer of Property Act would come into play in case the plaintiffs ultimately succeed in the suit. The learned District Judge did not make a mention in the impugned order dated 7.6.1995 that the conclusions drawn by the learned Sub Judge were perverse or there was an error of jurisdiction on his part. Then the discretion has been properly and formally exercised by the learned trial Court, it should not have been interferred with lightly by the learned District Judge, Ludhiana, till the findings are given that the order of the learned trial Court was perverse or suffers from any patent illegality or that the learned trial Judge had failed to exercise the jurisdiction vested in him by law. It has been held in Sham Singh v. Prem Chand and Ors., 1979 Revenue Law Reporter 506, that agreement to sell confers no title on a willing purchaser. The intended purchaser is not entitled to injunction restraining the true owner from interfering in his possession. Also it was held in Jasmer Singh and Ors. v. Kanwaljit Singh and Anr., (1990-2)98 P.L.R. 572, that the suit by vendee for injunction to restrain vendor from selling property to others was not maintainable in view of Section 41(h) of the Specific Relief Act. In Maman Chand v. Smt. Kamla, (1996-2) P.L.R. 147, white dealing with the scope of jurisdiction of the appellate Court under Order 39 Rules 1 and 2, C.P.C., it has been held that the appellate Court can interfere only with the orders of the trial Court if such orders suffer from clear violation of law or findings recorded by the trial Court on issues of prima facie case, balance of convenience and irreparable injury, are perverse; or the trial Court had not applied the settled principles of law for appreciation of pleadings and evidence produced by the parties. Mere possibility of the appellate Court forming a different opinion on the basis of facts and evidence produced by the parties cannot be a valid ground for interference by the appellate Court. The learned appellate Court did not advance any cogent reasons for allowing the application in part of the plaintiffs. In Rajendra Kumar v. Mahendra Kumar Mittal and Ors., AIR 1992 Allahabad 35, the dictum laid down by the Division Bench of the Allahabad High Court is that suit for injunction praying that the opposite party be restrained from alienating the property allegedly purchased by the plaintiff under an agreement is not maintainable because equally efficacious relief is available to such plaintiff to file a suit for specific performance of the contract. Also it has been held that no injunction can be granted in favour of such vendee. Similar to the effect is the citation reported as Satish Bahadur v. Hans Raj and Ors., (1980)82 P.L.R. 737.

13. Summing up the above discussion, I am of the considered opinion that the learned appellate Court was not right when it allowed the application under Order 39 Rules 1 and 2, C.P.C., in part as the basic principles of law had not been complied with by the plaintiffs, i.e., the petitioners in C.R. No. 3797 of 1995.

14. Resultantly, I allow Civil Revision No. 3079 of 1995 (Harbans Singh Kohli and Ors. v. Man Singh and Ors.) and dismiss Civil Revision No. 3707 of 1995 (Man Singh and Anr. v. H.S. Kohli and Ors.). The order dated 7.6.1995 passed by the Court of District Judge, Ludhiana, is set aside when it partly allowed the application under Order 39 Rules 1 and 2, C.P.C., filed by the plaintiffs Man Singh and Paramjit Singh Bhatia. The petitioners in Civil Revision No. 3079 of 1995 shall have the costs of both the revision petitions. I assess the fee of each of the counsel at Rs. 1,000/- in both the revision petitions.

15. Nothing stated above shall amount to an expression of my opinion on the merits of the suit.


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