Full Text
HIGH COURT OF DELHI
JUDGMENT
RAGHBIR SINGH CHHABRA ..... Plaintiff
Through: Mr. A.S. Chandhiok, Senior Advocate with Mr. P.S. Bindra, Senior
Advocate, Mr. Keshav Sehgal, Mr. Harkirat Singh, Mr. Kashish Bajaj and Mr. Shivam Gaur, Advocates.
Through: Mr. Ravinder Sethi, Senior Advocate with Mr. Prabhjit, Jauher, Mr. Puneet Sharma and Mr. Ranbir, Advocates for D-2.
Mr. Lalit Gupta, Mr. Amit Vohra, Mr. Siddharth Arora, Mr. Gaurav Kumar and Mr. Priyansh Jain, Advocates for
D-5 & 6.
BANSAL
Signing Date:29.03.2023 14:18:11 BRIEF FACTS
1. The present suit was originally filed as a suit for perpetual injunction before the Court of Additional District Judge (Central), Tis Hazari Courts on 3rd July, 2014 by the plaintiff against the defendant no.1, Holystar Natural Resources Private Limited.
2. The case set up by the plaintiff was that the plaintiff had entered into an agreement to sell dated 11th July, 2011 for sale of semi-furnished first floor measuring about 18 ft. X 68 ft. and second floor with terrace/roof above, measuring 18 ft. X 68 ft. forming part of freehold property bearing municipal no.10463 and 10466 built on plot no.42 and 43 situated in Western Extension Area, Ajmal Khan Road, Karol Bagh, New Delhi. The total sale consideration was Rs.10,50,00,000/-, out of which plaintiff had paid a sum of Rs.10,00,00,000/- to the defendant no.1, as noted in Clause 1 of the agreement to sell.
3. Yet another agreement to sell dated 20th February, 2013 was entered into between the plaintiff and the defendant no.1 for sale of one shop on ground floor ad measuring 9 ft. X 37-6 ft. along with basement forming part of freehold property bearing municipal No.10466 built on plot no.43, Western Extension Area, Ajmal Khan Road, Karol Bagh, New Delhi. The total sale consideration was Rs.5,00,00,000/-, out of which the plaintiff had paid Rs.3,97,00,000/- to the defendant, as noted in Clause 1 of the agreement to sell. As per the said agreement to sell dated 20th February, 2013, the defendant no.1 had to clear the amount payable to one M/s Rare Finance Pvt. Ltd. on or before 15th May, 2013 and Sale Deed could be executed only thereafter.
BANSAL
4. The portions of the properties covered under both the agreements to sell shall be collectively referred to as „suit properties‟.
5. Under the clause 8 of the agreement to sell dated 11th July, 2011 and clause 6 of the agreement to sell dated 20th February, 2013, the defendant no.1 had to complete the construction before registration of the sale deeds. Along with agreements to sell, possession letters were also issued stating that physical possession has been delivered to the plaintiff.
6. On 26th June, 2014, an ex parte ad interim injunction was passed in favour of the plaintiff directing the defendant no.1 not to forcibly dispossess the plaintiff from the suit properties without adopting the process of law, till further orders.
7. In the written statement filed on behalf of the defendant no.1 before the District Court on 30th July, 2014, it was stated that the defendant no.1 took a loan of Rs.2,65,00,000/- from the plaintiff and in respect of the said loan, the plaintiff got some blank papers and cheques signed from the defendant no.1 as a measure of security. It was specifically denied that any agreement to sell was executed between the parties. It was further stated that the two agreements to sell dated 11th July, 2011 and 20th February, 2013, the receipts and the possession letters are forged and fabricated. The suit properties were sealed on 2nd May, 2013 on account of violation of the Delhi Master Plan 2021. The defendant no.1 continued to be the lawful owner of the suit properties and never gave the possession of the suit properties to the plaintiff.
8. Subsequently on 19th November, 2015, the present suit was transferred to this Court on account of pecuniary jurisdiction.
9. A public notice dated 6th September, 2014 issued by HDFC Bank BANSAL under the provisions of SARFAESI Act for taking symbolic possession of the suit properties on account of defendant no.1 defaulting in repayment of loan of Rs.11,28,47,780/- taken from HDFC Bank, for which the Plot no.43, Block 15-A, WEA, Ajmal Khan Road was mortgaged. The plaintiff as a bonafide purchaser of the aforesaid property, filed an application under Section 17(1) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) before Debt Recovery Tribunal (DRT-III). The defendant no.1 also filed an application against the impugned notice under Section 13(4) of the SARFAESI Act, wherein it was undertaken by the defendant no.1 and Mr. Pradeep Paliwal, Director of the defendant no.1, to pay the loan amount in 12 months.
10. Since the defendant no.1 defaulted in repaying the loan amount, HDFC Bank initiated proceedings under Section 14 of the SARFAESI Act, which resulted in an order dated 16th October, 2015 passed by the Chief Metropolitan Magistrate (CMM), Central, Tis Hazari Courts. This order was challenged by the HDFC Bank before this Court by way of a Writ Petition, being W.P.(C) No.685/2016 and vide order dated 27th January, 2016, this Court appointed a Local Commissioner to file a report with regard to the state and possession of the property. The Local Commissioner filed her report dated 5th February, 2016 wherein it was stated that the aforesaid property was in a shell form. The construction consisted of basement, ground floor, first floor, second floor and third floors with incomplete construction on all the floors.
11. The plaintiff also filed a criminal complaint against Mr. Pradeep Paliwal, which resulted in registration of FIR No.494 dated 24th June, 2015.
BANSAL In the proceedings for grant of bail initiated by Mr. Pradeep Paliwal (BAIL APPLN.2441/2015), a Memorandum of Understanding dated 23rd December, 2015 was executed between the plaintiff and Mr. Pradeep Paliwal, which was made part of the bail order dated 23rd December, 2015 passed by this Court. Mr. Pradeep Paliwal failed to abide by the terms of the said Memorandum of Settlement and the plaintiff was constrained to initiate contempt proceedings (CONT. CAS(C) 316/2016). Parties entered into a fresh Memorandum of Understanding/undertaking dated 17th May, 2016 on the basis of which the contempt case was disposed of vide order dated 17th May, 2016. In terms of the aforesaid Memorandum of Understanding/undertaking, Mr. Pradeep Paliwal was to execute sale deeds in respect of portions of the suit properties in favour of the plaintiff.
12. In September, 2016, the plaintiff came to know that the defendant no.1 acting through Mr. Pradeep Paliwal, had executed an agreement to sell and sale deed both dated 27th April, 2016 for a part of the suit properties so as to defeat the rights of the plaintiff under the earlier agreements to sell and in violation of the undertaking given to the Court.
FURTHER PROCEEDINGS IN THE SUIT
13. In view of subsequent developments, the plaintiff filed an application under Order VI Rule 17 of the CPC seeking amendment of the plaint, which was allowed by this Court on 10th September, 2018 and the amended plaint was taken on record. In the amended plaint, the plaintiff sought additional reliefs for specific performance of the two agreements to sell dated 11th July, 2011 and 20th February, 2013 and a decree of declaration against the agreement to sell and sale deed executed on 27th April, 2016 between the BANSAL defendant no.1 in favour of Mr. Umang Bajaj, Mr. Pratap Mohan and Mr. Rajiv Aneja, who were impleaded as the defendants no.2, 3 and 4. The interim order dated 26th June, 2014 was also made operable against the defendants no. 2 to 4.
14. On 22nd April, 2022, a contempt petition, being CCP(O) 26/2022 was filed and the defendants no.2, 3, 4 along with Mr. Mukesh Garg were impleaded as respondents therein. In the said contempt petition it was stated that in violation of the interim order passed by this Court, part of the suit properties had been mortgaged in favour of the Union Bank of India (UBI) and UBI had auctioned the aforesaid property in favour of the defendant no.6. It was also stated that the defendant no.5 through defendant no.6 had filed a suit, being CS No.957/2022 before the Tis Hazari District Court against North Delhi Municipal Corporation and the plaintiff herein seeking injunction against them from interfering with the possession of the defendant no.6 in the suit property.
15. Vide order dated 26th April, 2022, Mr. Mukesh Garg, who was the respondent no.4 in CCP(O) 26/2022 was impleaded as the defendant no.5 in the present suit and it was directed that the interim order dated 26th June, 2014 shall also apply to him. Vide order dated 23rd May, 2022, M/s. Pooja Buildtech Pvt. Ltd. was also impleaded as the defendant no.6 in the suit and it was directed that all the defendants shall maintain status quo order in respect of the suit properties.
16. I.A.7439/2022 under Order XXXIX Rule 4 of the CPC was filed on behalf of the defendant no.5, I.A.10596/2022 was filed on behalf of the defendant no.6 under Order XXXIX Rule 4 of the CPC and I.A.11708/2022 was filed on behalf of the defendants no.2, 3 and 4 under Order XXXIX BANSAL Rule 4 of the CPC for vacation of the interim order dated 26th June, 2014.
17. Replies to the aforesaid applications have been filed on behalf of the plaintiff. Rejoinders thereto have also been filed.
18. The interim application originally filed by the plaintiff under Order XXXIX Rules 1 and 2 of the CPC before the District Judge for restraining the defendant no.1 from dispossessing the plaintiff from the suit properties, on which the order dated 26th June, 2014 was passed, has subsequently been renumbered as I.A. 1468/2023 upon the transfer of the suit to this Court. I.A. 1468/2023. I.A. 8146/2022 under Order XXXIX Rules 1 and 2 of the CPC has been filed by the plaintiff seeking restraint against the defendants from creating any third-party interest in respect of the suit properties.
19. On 22nd July, 2022, a Local Commissioner was appointed by this Court to visit the suit properties. The relevant portion of the said order has been set out below: “1. Counsels for the parties have been heard at length. There is a dispute with regard to whether or not the portions constructed over Plot No. 42 and 43, Block-15A, Municipal No.-10463 and 10466, Western Extension Area, Ajmal Khan Road, Karol Bagh, Delhi-110005 (suit premises) are lying sealed and if so, which portions are lying sealed. Further, there is also a dispute with regard to possession of the aforesaid portions constructed over the said plots.
2. Counsel for defendants no. 5 and 6 places reliance on the Sale Certificate dated 25th March, 2022 issued in their favour by the Union Bank of India, in terms of which certain portions of the said properties have been sold to them and possession thereof has been handed over. This is disputed by the senior counsel appearing on behalf of the plaintiff.
3. Accordingly, Ms. Namrata Kapoor (Mob. No. 9810034036) BANSAL is appointed as the Local Commissioner to visit the suit premises during the course of the day today. The Local Commissioner shall take following steps:
I. The Local Commissioner shall visit and inspect the entire suit premises and determine which of the portions constructed over the said plots are lying sealed.
II. In the event that some portions of the suit premises are not lying sealed, the Local Commissioner shall determine which of the parties is in possession of the said portions.
III. The Local Commissioner shall also determine, even in respect of the sealed portions, which of the parties’ locks are installed at the said portions of the suit premises.
IV. The Local Commissioner shall be accompanied by one representative each of the plaintiff and the defendants no. 5 and 6.”
20. The Local Commissioner filed her report on 28th July, 2022 with photographs and along with a pen drive containing the videos of the execution of the commission.
21. During the course of the hearing on 6th January, 2023, in order to gain clarity of the properties that are subject matters of the two agreements to sell dated 11th July, 2011[2] and 20th February, 2013, the plaintiff was directed to file complete details of the said properties along with a site plan giving exact measurements of the properties in question. Pursuant thereto an affidavit was filed on behalf of the plaintiff on 14th January, 2023.
22. In paragraph 5 of the said affidavit, the plaintiff gave the details of the property that is the subject matter of the agreement to sell dated 11th July, 2011 and the same is shaded in green in the site plan (Annexure A) filed by BANSAL the plaintiff along with the affidavit. Paragraph 8 of the aforesaid affidavit gives description of the property that is the subject matter of the agreement to sell dated 20th February, 2013. The said portion is shaded in red in Annexure A.
23. Details of the suit properties given by the plaintiff in the affidavit were reproduced in the order dated 25th January, 2023 passed by this Court. It may be relevant to set out the order passed by this Court on 25th January, 2023: “1. Pursuant to the order passed by this Court on 6th January, 2023, an affidavit has been filed on behalf of the plaintiff on 16th January, 2023. In paragraph 5 of the said affidavit, the plaintiff has given the details of the property that was the subject matter of Agreement to Sell dated 11th July, 2011 and the same is set out below: “a. semi-finished First Floor measuring about 18'x68' & Second Floor, with terrace/roof and above, measuring about 18'x68', part of freehold property bearing Municipal No. 10463 & 10466, built on Plot No.42 & 43, in Block No.15-A, situated at Western Extension Area, Ajmal Khan Road, Karol Bagh, New Delhi, and b. Third Floor with terrace/roof and above, measuring about 18'x34', part of freehold property bearing Municipal No. 10463, built on Plot No.42, in Block No.15-A, situated at Western Extension Area, Ajmal Khan Road, Karol Bagh, New Delhi.”
2. In paragraph 8 of the aforesaid affidavit, the plaintiff has provided description of the property that was the subject matter of Agreement to Sell dated 20th February, 2013 and the same is set out below: “a. One Shop on Ground Floor, having its area measuring about 9'x37'-6",connecting with staircase in the Basement underneath having its area measuring about 9'x37'-6", forming part of the freehold property BANSAL bearing Municipal No. 10466, built on Plot No.43, in Block No.15-A, situated at Western Extension Area, Ajmal Khan Road, Karol Bagh, New Delhi.”
3. The plaintiff has also filed Annexure A, which contains the site plan in respect of the aforesaid properties. The portions shaded in green in the said site plan are the subject matter of the Agreement to Sell dated 11th July, 2011 and the portions shaded in red are the subject matter of the Agreement to Sell dated 20th February, 2013.
4. Mr. A.S. Chandhiok, Senior Advocate appearing on behalf of plaintiff, submits that Annexure B is a mere reproduction of Annexure A and may be discarded.
5. Counsels appearing on behalf of the defendants do not dispute the aforesaid description of the two properties except to the extent of the open shaft area on the third floor, which is shaded in green in the said site plan at Annexure A of the plaintiff’s affidavit.
6. In view of the aforesaid, it is clarified that the interim orders dated 26th June, 2014, 10th September, 2018 and 23rd May, 2022 passed in the present suit shall be confined only in respect of the portions of the properties, as detailed above.”
SUBMISSIONS OF THE DEFENDANTS NO.5 AND 6
24. Counsel appearing on behalf of the defendants no.5 and 6 has made the following submissions:
(i) Defendant no.6 is the owner of basement, ground floor, first floor and second floor of the part portion of 15A/42, WEA, Karol Bagh in terms of the e-auction conducted by UBI on 10th March, 2022. The plaintiff claims rights in respect only first floor and second floor of the said portion. Since the plaintiff is not claiming any right over the basement BANSAL and the ground floor of the said portion, the plaintiff cannot claim possession of the first floor and second floor and the third floor above as the passage of the aforesaid floors is only from the ground floor, the possession of which is with the defendant no.6.
(ii) A sale certificate dated 25th March, 2022 was issued by UBI in favour of the defendant no.6 wherein it was mentioned that the physical possession of the said portion of the suit properties was hand over to the defendant no.6.
(iii) Possession of the aforesaid portion of the suit properties was with UBI and thereafter with the defendant no.6 is evident from the report of the Local Commissioner filed on 28th July, 2022. The possession of the aforesaid portion of the suit properties was taken over by UBI pursuant to proceedings under the SARFAESI Act. The plaintiff has never challenged the aforesaid proceedings under SARFAESI Act. The aforesaid portion was not the subject matter of the sealing proceedings pending before the District Judge, Tis Hazari Courts.
(iv) Possession of the plaintiff cannot be protected under Section 53-A of the Transfer of Property Act, 1882 in view of the agreements to sell being unregistered documents.
SUBMISSIONS OF THE DEFENDANTS NO.2, 3 AND 4
25. Senior counsel appearing on behalf of the defendants no.2, 3 and 4 have made the following submissions:
(i) Possession of the plaintiff cannot be protected under an unregistered agreement to sell in terms of Section 53A of the Transfer of Property Act read with Section 17(1)(a) of the Registration Act, 1908. Both the BANSAL agreements to sell in respect of which the plaintiff claims specific performance are unregistered. Reliance in this regard is placed on the judgment in Mac Associates v. S.P. Singh Chandel, 2013 SCC OnLine Del 518 and Uma Hada v. Sunil Gupta, (2021) 2 HCC (Del)
401.
(ii) Notwithstanding the amendment to the suit being allowed on 10th September, 2018, the suit for specific performance is liable to be dismissed as on the date of the amendment, the suit relating to prayer for specific performance was time barred. In the year 2014, the plaintiff filed a simpliciter suit for injunction and did not make any prayer for specific performance of the agreements dated 11th July, 2011 and 20th February, 2013. When the amendment in respect of specific performance was allowed on 10th September, 2018, the period of limitation of three years for a suit for specific performance under Article 54 of the Schedule to the Limitation Act, stood expired.
(iii) Plaintiff has not filed any proof of payment of huge amounts of cash payments allegedly made under the agreements to sell. Under the aforesaid two agreements to sell, plaintiff has claimed to pay a total of Rs.10.97 crores to the defendant no.1 in cash. The aforesaid agreements to sell were executed to defeat the rights of the defendants no.2 to 4, who had executed an earlier agreement to sell dated 17th March, 2011 and under which the defendant no.2 had already paid a sum of Rs.[7] crores to the defendant no.1 by way of account payee cheques.
(iv) In terms of the Memorandum of Settlement/Undertaking, the plaintiff had agreed to settle in money in respect of his claims and therefore, he BANSAL is disentitled to seek the relief of specific performance.
SUBMISSIONS OF THE PLAINTIFF
26. Senior counsel appearing on behalf of the plaintiff has made the following submissions:
(i) Despite being aware of the pendency of the present proceedings and the stay orders granted in the present suit, the defendants have created third party rights in the suit properties. The agreement to sell dated 27th April, 2016 in favour of the defendants no.2 to 4 records the pendency of the present suit and specifically states that possession shall be subject to orders passed in the present suit.
(ii) Defendant no.4 is a witness to the sale deed dated 25th September,
2017 executed in favour of the defendant no.5, Mukesh Garg. Therefore, all the defendants were aware of the interim orders passed in the present suit.
(iii) Defendant no.6 had filed an injunction suit bearing no.957/2022 before the District Courts, Tis Hazari wherein it was claimed that the suit properties in the present suit and the property in the said injunction suit are different. The Additional Senior Civil Judge vide order dated 20th April, 2022 dismissed the plaintiff‟s application for ad interim injunction. It is only after the said dismissal that the present applications under Order XXXIX Rule 4 of the CPC have been filed in the present suit. In the said applications, the defendants no.5 and 6 have failed to disclose the filing of the aforesaid injunction suit as well as the dismissal order dated 20th April, 2022.
(iv) The plaintiff is in possession of the suit properties since 2011 and
BANSAL 2013 respectively, being the dates on which the agreements to sell dated 11th February, 2013 were executed. Reliance in this regard is placed on the possession letters dated 11th February, 2013. Reliance is also placed on the electricity bills, telephone bills and challan dated 16th September, 2014 issued by NDMC in the name of the plaintiff to show that the plaintiff has been in continuous possession.
(v) Defendant no.1, in various civil and criminal proceedings, has acknowledged the existence of the two agreements to sell and therefore, it cannot be contended by other defendants that the aforesaid agreements are not valid. Reliance in this regard is placed on the orders dated 23rd December, 2015 in Bail Application No.2441/2015, order dated 17th May, 2016 in contempt case (Civil) 316/2016 and the Memorandum of Understanding/ Undertaking given to the Court dated 17th May, 2016.
(vi) The possession of the plaintiff has been acknowledged in the orders dated 28th April, 2016 and 22nd November, 2016 passed in W.P.(C) 685/2016. Further, the possession has also been acknowledged by the defendant no.1 through Mr. Pradeep Paliwal in the Memorandum of Understanding/Undertaking dated 17th May, 2016. The possession of the plaintiff also stands confirmed in terms of the reports of the Local Commissioners (i) dated 15th February, 2016 in W.P.(C) 685/2016 and (ii) dated 28th July, 2022 in terms of the order passed by this Court on 22nd July, 2022.
(vii) The fact that the suit properties are in form of a shell i.e., without internal partitions, has been corroborated by the aforesaid reports of BANSAL the Local Commissioner. Therefore, it is necessary to maintain status quo as directed by this Court on 26th June, 2014.
(viii) The contention of the defendant no.6 that it has taken possession of a part of the suit properties from UBI is completely misconceived as UBI never had the possession of the said properties. The sale certificate dated 25th March, 2022 issued by UBI in favour of the defendant no.6 clearly states that the sale is on „as is where basis‟.
(ix) Section 53A of the Transfer of Property Act is not applicable when a suit for specific performance is pending before the Court. Section 53A of the Transfer of Property Act protects possession of the defendant in the event plaintiff has been held to be disentitled to relief of specific performance or enforcement of agreement to sell. Reliance is placed on the judgment of a Co-ordinate Bench of this Court in Arvindra Kumar Singh v. Hardayal Kaur & Ors, 2005 SCC OnLine Del 98.
(x) The interim order passed on 26th June, 2014 only states that the plaintiff shall not be dispossessed without due process of law. Therefore, it only grants limited protection in favour of the plaintiff inasmuch as the defendants have to follow procedure established by law to regain possession. By way of the present applications, the defendants seek to subvert the due process of law in order to evade appropriate process of filing a suit.
ANALYSIS AND FINDINGS
27. I have heard the counsel for the parties and perused the record of the case.
BANSAL MISREPRESENTATION, CONCEALMENT AND SUPPRESSION
28. Senior counsel appearing on behalf of plaintiff has drawn the attention of the Court to a civil suit for permanent injunction, being CS No.957/2022 filed on behalf of the defendant no.6 before the Court of Senior Civil Judge, Central District, Tis Hazari Courts. Reference may be made to paragraphs 2 and 6 of the aforesaid plaint, which are set out below: “2. That the plaintiff company has purchased the portion of property M No.10463 Block 15 A, bearing No.150A/42, part of property i.e. 30.[6] X 18 sq. ft. each floor, comprising of basement, GF, FF and SF WEA Karol Bagh, New Delhi vide Sale Certificate dated 25.03.2022 from Union Bank of India, hereinafter called the suit property for a sum of Rs.3.15 crore. The copy of the Sale certificate is attached herewith. xxx xxx xxx
6. That it is imperative to mention at this junction that defendant no.2 has filed suit for Specific Performance, Declaration and Permanent Injunction on the basis of unregistered agreement to sell i.e. 11.07.2011 and 20.03.2013 before the Hon’ble High Court of Delhi, not in respect of the suit property and the title of the plaintiff qua the suit property is clear and there is no stay qua the suit property from any court of law.”
29. The prayer clause in the aforesaid suit is set out below: “It is, therefore, most respectfully prayed that this Hon’ble Court may kindly be pleased to pass a decree of the permanent injunction in favour of the plaintiff and against the defendant No.2 thereby the restraining the defendant no.2 not to dispossess the plaintiff from the suit property i.e. portion of property M No.10463 Block 15A, bearing no.15-A/42, part of property i.e. 30.[6] X 18 sq. ft. each floor, comprising of basement, GF, FF and SF WEA Karol Bagh, New Delhi, which is more clearly shown in the site plan in the red colour.” BANSAL
30. The application for interim injunction filed in the aforesaid suit seeking restraint against the defendant no.2 (plaintiff in the present suit) not to dispossess the plaintiff (defendant no.6 herein) from the subject property was dismissed by the Court on 20th April, 2022.
31. Immediately after the dismissal of the aforesaid application, counsel for the defendant no.5 appeared in the present suit on 26th April, 2022 and sought impleadment, which was granted on the same day. Soon thereafter, on 4th May, 2022, the defendant no.5 filed I.A.7439/2022 under provisions of Order XXXIX Rule 4 of the CPC. The defendant no.6 was impleaded on 23rd May, 2022 and I.A.10596/2022 was filed on behalf of the defendant no.6 under Order XXXIX Rule 4 of the CPC on 13th June, 2022.
32. In CS No.957/2022, the defendants no.5 and 6 sought to mislead the Court by suggesting that the portions of the suit properties sold to the defendant no.6 under the sale certificate dated 25th March, 2022 by UBI are not part of the suit properties in the present suit. However, in I.A. 10596/2022 filed under Order XXXIX Rule 4 of the CPC in the present suit, a completely opposite stand has been taken by the defendant no.6 that the property purchased by the defendant no.6 from Union Bank of India in the auction dated 10th March, 2022 is part of the suit properties in the present suit. Therefore, I am convinced that CS No.957/2022 was filed on behalf of the defendant no.6 based on false statements in order to obtain an interim injunction behind the back of the plaintiff and to establish its possession.
33. In I.A.7439/2022 and I.A.10596/2022 filed by the defendant no.5 and defendant no.6 respectively, filing of the aforesaid suit or the dismissal of the interim application has not been disclosed. Further, filing of the aforesaid suit has not even been disclosed in written statement filed by the BANSAL defendant no.6 on 6th July, 2022. If the property that was subject matter of CS No.957/ 2022 was not the subject matter of the present suit, there was no reason for the defendants no.5 and 6 to file the present applications under Order XXXIX Rule 4 of the CPC.
34. Having not succeed in obtaining orders in CS No.957/ 2022 before Senior Civil Judge, the defendants no.5 and 6 got themselves impleaded in the present suit and filed applications for vacation of stay without disclosing the factum of having filed the earlier suit and the dismissal order. This amounts to gross concealment and suppression on behalf of the defendants no.5 and 6. Concealment of material facts and documents is a serious matter and sufficient for disqualifying a litigant from obtaining relief. Reference in this regard may be made to S.J.S. Business Enterprises (P) Ltd. v. State of Bihar, (2004) 7 SCC 166 and Harkirat Singh v. Amrinder Singh, (2005) 13 SCC 511, followed by me in KENT Ro System Ltd. v. Gattubhai, (2022) 2 HCC (Del) 701. Therefore, the applications filed on behalf of the defendant no.5 and defendant no.6 under Order XXXIX Rule 4 of the CPC are liable to be dismissed on this ground alone.
DEFENDANTS NO.2 TO 4 AND DEFENDANTS NO.5 AND 6 ARE NOT BONAFIDE PURCHASERS
35. It is a matter of record that I.A. 3958/2018 was filed on behalf of the defendant no.5 on 15th March, 2018 seeking impleadment in the present suit and the defendant no.5 was represented when the order dated 10th September, 2018 was passed by this Court. From the aforesaid, it is clear that both the defendant no.5 as well as the defendant no.6 were aware of the present suit and the interim orders passed in the present suit. Despite being aware of the present suit and the interim orders, the defendants no.5 and 6 BANSAL participated in the auction on 10th March, 2022 conducted by Union Bank of India. The defendants no.5 and 6 had complete knowledge that the property that was subject matter of the auction was also subject matter of the present suit and in respect of which interim orders have been passed in the present suit. Therefore, the defendants no.5 and 6 cannot be considered as bonafide purchasers of the subject suit property.
36. As regards the defendants no. 2 to 4, in the agreement to sell dated 27th April, 2016 by defendant no.1 in favour of the defendants no.2, 3 and 4 it has been specifically noted that possession shall be delivered subject to orders passed in the present suit and that the sale deed can be executed only subject to pending litigations. In light of the above, it is clear that the defendants no.2 to 4 entered into the agreement to sell with a clear understanding that the property that is the subject matter of the said agreement to sell, is subject matter of a pending litigation before the Delhi High Court, i.e., the present suit and the possession can be settled only in terms of the orders passed in the present suit. This amounts to a clear acknowledgement that the defendants no.2 to 4 did not have the possession of the said suit property. Despite being aware of the present suit, the defendants no. 2 to 4 entered into an agreement to sell and sale deed dated 27th April, 2016 with the defendant no.1. Therefore, the defendants no.2 to 4 also cannot be considered as bonafide purchasers of the suit property.
POSSESSION OF THE SUIT PROPERTIES
37. The two agreements to sell dated 11th February, 2013 clearly record that the defendant no.1 has handed over physical vacant possession of the suit properties to the plaintiff. Contemporaneous BANSAL possession letters have also been placed on record. The plaintiff has also placed on record electricity/telephone bills in support of his claim of possession.
38. It has been contended on behalf of the defendants no.2 to 6 that the aforesaid agreements to sell are unlawful and invalid and the plaintiff was not given possession under the aforesaid agreements.
39. As noted above in the bail proceedings, a Memorandum of Understanding/Undertaking was entered into between Mr. Pradeep Paliwal and the plaintiff on 23rd December, 2015. In terms of said Memorandum of Understanding/Undertaking Mr. Pradeep Paliwal acknowledged the agreements to sell and agreed to execute the sale deeds in favour of the plaintiff. Even the contempt case was disposed of on the basis of the undertaking dated 17th May, 2016. Therefore, at this stage, the defendants 2 to 4 and the defendants no.5 and 6 cannot be heard to say that the agreements to sell entered into between the plaintiff and defendant no.1 were invalid or that possession of the suit properties was not handed over to the plaintiff in terms thereof. The aforesaid defendants do not have any locus to question the validity of subject agreements to sell.
40. The Local Commissioner appointed by this Court vide order dated 27th January, 2016 in Writ Petition filed by HDFC Bank before this Court had, inter alia, stated in her report as under: “… Apparently the possession seems to be that of Sh. R.S. Chhabra as the locks of the shutters were opened by his employees and the articles lying in the middle portions of the property were stated to be of his employee, Sh. Ashok Pandey”
41. It was also noted in the said report that the property bearing plot no.43 BANSAL was in shell form and was interconnected with property bearing plot no.42 with an intervening connecting wall.
42. Subsequently, vide order dated 22nd November, 2016 in the aforesaid Writ Petition, it was clarified that the Court is not disturbing the prevailing status qua possession of the parties i.e., plaintiff and the defendant no.1 in the present suit.
43. The Appellate Tribunal MCD, vide order dated 2nd April, 2019, had ordered the de-sealing of the properties in question. The aforesaid order was challenged by the plaintiff before the District Judge in Appeal no.5/2019 and the operation of the said order was stayed vide order dated 6th April, 2019.
44. It is the case of the defendants no.5 and 6 that in the proceedings initiated under SARFAESI ACT, 2002 by UBI, Court Receiver had taken possession on 27th January, 2016, in terms of the order passed by the Chief Metropolitan Magistrate (CMM) (Central), Tis Hazari Courts. Thereafter, the property was sold by UBI vide e-auction dated 10th March, 2022 to the defendant no.6. However, nothing has been placed on record to show as to how UBI obtained possession of the suit property and how the possession has been conveyed to the defendant no.6. It is pertinent to note that the sale certificate dated 25th March, 2022 issued by UBI in favour of the defendant no.6 states that the sale was made on „as is where basis‟. In fact, in the application for impleadment filed by UBI before the District Judge it has been admitted that the suit property has been sealed. The letter dated 25th January, 2019 written by the consultants hired by UBI also states that the suit property has been sealed. Even in the status report dated 9th December, 2022 filed by the Municipal Corporation of Delhi in Appeal no.4/2019 and 5/2019, it is stated that the suit properties are lying sealed in the records of BANSAL the Corporation.
45. The Local Commissioner appointed by this Court vide order dated 22nd July, 2022 to visit the suit properties, in her report filed on 28th July, 2022 had, inter alia, stated as under: “Under the circumstances, it cannot be verified that which party is in possession of which portion of the Suit Premises.”
46. It was also noted in the said report that the entire suit properties were only partially constructed and the constructed portion on plot no.42 and plot no.43 were interconnected.
47. In view of the discussion above, it appears that the suit properties or at least portions thereof, remain sealed. Further, it cannot be said that the plaintiff is not in possession of the suit properties. Nor can it be said that the defendants are in possession.
APPLICABILITY OF SECTION 53-A OF THE TRANSFER OF PRROPERTY ACT, 1882
48. Counsel for the defendants submits that in view of the fact that the agreements to sell dated 11th February, 2013 are not registered, the possession of the plaintiff cannot be protected under Section 53-A of the Transfer of Property Act.
49. The defence under Section 53-A of the Transfer of Property Act is only available to a party, when in part performance of an agreement to sell, that party has taken possession of the property that is subject matter of the agreement to sell. In terms of Section 53A of the Transfer of Property Act, when a transferee has been put in possession in part performance of the contract and the transferee is willing to perform his part of the contract, even if a sale deed has not been executed, the transferee cannot be dispossessed.
BANSAL
50. In the present case, Section 53-A of the Transfer of Property Act can be used to protect the possession of the plaintiff if it is ultimately held that the plaintiff is not entitled to relief of specific performance. It has no application when the suit for specific performance is pending. A suit for specific performance can be initiated on the basis of an oral agreement to sell as well and therefore, there cannot be any bar on a suit for specific performance being initiated on the basis of an unregistered agreement to sell. In terms of the proviso to Section 49 of the Registration Act, 1908 in a suit for specific performance, an unregistered document affecting an immovable property, which is required by the Transfer of Property Act to be registered, may be received as evidence of a contract. In Mac Associates (supra) relied upon by the defendants, the plaintiff therein had filed a suit for possession on the basis of an unregistered agreement to sell and it was not a case where a suit for specific performance was filed.
51. Further, protection under Section 53-A can be considered in a claim against a party seeking possession of the subject property. In the present case, the defendants have not filed any claim or suit for possession against the plaintiff. In Uma Hada (supra), relied upon by the defendants, it was the defendant who was seeking the benefit of Section 53-A of the Transfer of Property Act in a suit for possession filed by the plaintiff, which was rejected by this Court. Therefore, the aforesaid judgment does not advance the case of the defendants.
52. In Arvindra Kumar Singh (supra), relied upon by the plaintiff, the plaintiff therein on the basis of an unregistered agreement to sell, had filed a suit for permanent injunction restraining the defendants from dispossessing the plaintiff from the suit properties. A Co-ordinate Bench of this Court held BANSAL that even if an agreement to sell is unregistered, the defendants have to take recourse to the procedure established by law to regain possession.
53. A perusal of the interim order passed on 26th June, 2014, of which defendants seek vacation, would show that the limited protection granted to the plaintiff is that the plaintiff shall not be forcibly dispossessed from the suit properties without adopting the process of law. Therefore, there is no bar on the defendants to initiate appropriate legal proceedings for claiming possession of the suit properties. By way of the present applications the defendants are trying to obtain possession of the suit properties, which is impermissible in law.
RELIEF OF SPECIFIC PERFORMANCE BEING BARRED BY LIMITATION
54. Next, it has been contended on behalf of the defendants that on the date when the present suit was amended to incorporate the relief of specific performance, the relief of specific performance itself was time barred.
55. It is a settled position of law that an amendment once incorporated, relates back to the date of the suit. Reference in this regard may be made to the judgment of the Supreme Court in Sampath Kumar v. Ayyakannu, (2002) 7 SCC 559 and Prithi Pal Singh v. Amrik Singh, (2013) 9 SCC 576. The Supreme Court in Sampath Kumar (supra) observed that an amendment once incorporated relates back to the date of the suit. However, the Court is competent to direct that the amendment shall not relate back to the date of suit and shall be deemed to have been brought before the Court on the date of filing of the amendment application. Further, the Supreme Court in Prithi Pal (supra) observed that where the Court has allowed the application for amendment of plaint without any condition/rider, it would be presumed that the amendment would relate back to the filing of the suit.
BANSAL
56. In the present case, the suit was filed on 3rd July, 2014 and the amendment application was allowed by the Court vide order dated 10th September, 2018 without any rider or condition. Therefore, at this interlocutory stage, it would have to be taken that the amendment in the plaint would relate back to the filing of the suit.
CONCLUSION
57. In view of the discussion above, no grounds are made out for vacation of the interim order passed on 26th June, 2014 read with orders dated 10th September, 2018, 26th April, 2022 and 23rd May, 2022. However, the interim order dated 26th June, 2014 read with orders dated 10th September, 2018, 26th April, 2022 and 23rd May, 2022 shall operate only in respect of portions of the properties as identified in the order dated 25th January, 2023 passed by this Court. Further, all parties are directed to maintain status quo with regard to title of the suit properties till the final adjudication of the suit.
58. I.A. 8146/2022 and I.A. 1468/2023 filed under Order XXXIX Rules 1 and 2 of the CPC and I.A. 7439/2022, I.A. 10596/2022 and I.A. 11708/2022 filed under Order XXXIX Rule 4 of the CPC stand disposed of in the aforesaid terms.
59. On account of gross suppression, concealment and misrepresentation of facts on behalf of the defendants no.5 and 6, the defendants no.5 and 6 are burdened with costs of Rs.1,00,000/- to be paid to the AASRA Fund, Account No.15530110140468, UCO Bank, Delhi High Court, IFSC Code: USBA0001553.
60. Needless to state, any observations made herein are only for the purposes of adjudication of the present applications and would have no bearing on the final outcome of the suit.
BANSAL CS(COMM) 7/2015, I.A. 6059/2019 (of the defendants no.2 and 4 u/O- VII R-11 of CPC), I.A. 6276/2019 (of the defendants no.2 and 4 u/O-I Rule-10 of CPC), I.A. 7318/2019 (of the defendants no.2 and 4 for condonation of delay of 81 days in filing WS), CRL.M.A. 10169/2022 (Under Section 340 of CrPC) & I.A. 15894/2022 (Under Section 151 of CPC)
61. List before the Roster Bench on 22nd May, 2023. AMIT BANSAL, J. MARCH 29, 2023 BANSAL