Mohammad Ibrahim v. Mr. Nikhilesh Mittal,

IN THE HIGH COURT AT CALCUTTA

CIVIL APPELLATE JURISDICTION

APPELLATE SIDE

Present:

The Hon'ble Justice Jyotirmay Bhattacharya

AND

The Hon'ble Justice Ishan Chandra Das F.M.A.T. 481 of 2016

with

CAN 4980 of 2016

Rajesh Baid & Anr.

versus

Mohammad Ibrahim

For the Defendants/Appellants : Mr. Sabyasachi Bhattacharya, Sr. Adv. Mr. Nikhilesh Mittal,

Mr. Prashant Agarwal.

For the Plaintiff/Respondent : Mr. Swarup Banerjee, Mr. Srinibash Misra.

Heard On : 20-07-2016. Judgement On : 20-07-2016. Jyotirmay Bhattacharya, J. : This first miscellaneous appeal is directed against an order being No.2 dated 26^thApril, 2016 passed by the learned Judge- in-Charge, 12^thBench, City Civil Court at Calcutta in Title Suit No. 491 of 2016 at the instance of the defendants/appellants.

By the impugned order, the learned Trial Judge was pleased to pass an ad interim order of injunction restraining the defendants from selling, transferring, mortgaging, encumbering, dealing with and/or parting with possession of the suit premises to any person, save and except in compliance of the terms of the

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agreement for sale dated 5^thFebruary, 2016 executed by and between the parties till 25^thMay, 2016. The said ad interim order of injunction was further extended by the learned Trial Judge and the said order is still in force. Such an ad interim order of injunction was passed by the learned Trial Judge in a suit for declaration and injunction filed by the plaintiff/respondent.

The plaintiff claims that he entered into an agreement for sale with the defendants for purchasing the suit property for a consideration of Rs.8,00,00,000/- (Rupees eight crore only). He further claims that he has paid a sum of Rs.51,00,000/- (Rupees fifty one lakh only) by cash to the defendants towards earnest money. Such agreement for sale was entered into between the parties on 5^thFebruary, 2016. Time for completion of the said agreement was fixed in the said contract. It is provided therein that the said transaction should be completed within six months from the date of entering into such agreement. There is also a provision for extension by one month for completion of the said transaction.

Since during subsistence of the said agreement for sale, the defendants were trying to sell the suit property to the stranger purchaser, the plaintiff filed the said suit seeking declaration about the validity and/or legality of the said agreement for sale entered into between the parties on 5^thFebruary, 2016. He has also prayed for injunction for restraining the defendants from selling, transferring, mortgaging, encumbering, dealing with and/or parting with possession of the suit property till the disposal of the suit. An ad interim injunction was also prayed for in the said application for injunction in similar term.

Learned Trial Judge while dealing with the plaintiff's application for ad interim injunction held that the plaintiff has made out a prima facie case for going to trial. Learned Trial Judge has also held that the balance of convenience and inconvenience is also in favour of the plaintiff. Such conclusion was drawn

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by the learned Trial Judge as the learned Trial Judge found that an agreement was entered into between the parties and in pursuance of the said agreement, a sum of Rs.51,00,000/- (Rupees fifty one lakh only) has already been paid in cash by the plaintiff to the defendants towards earnest money. Learned Trial Judge also found that time for completion of the said agreement has not yet expired. Under such circumstances, learned Trial Judge passed the aforesaid ad interim order of injunction. The legality and/or correctness of the said ad interim order of injunction is under challenge in this appeal before us.

Let us now test the legality of such impugned order in the facts of the instant case.

Since we are considering the legality and/or propriety of the ad interim order of injunction, we will have to restrict ourselves to consider the legality of such impugned order with reference to the pleadings of the plaintiff made out in the plaint as well as in the injunction application. At this stage, we cannot consider the pleadings made out by the defendants in the stay application to ascertain the legality of the impugned order. As such while considering the legality of the impugned order, we will confine ourselves to the pleadings made out by the plaintiff in the plaint as well as in the injunction application. On reading the plaint as well as the injunction application, we find that the plaintiff claimed that the defendants are the partners of M/s. Onex Projects LLP and also the owners of premises No. 43, Zakaria Street, P.S. Jorasanko, Kolkata- 700073 hereinafter referred to as the "suit property". He further claimed that relying upon the representation made by the defendants, the plaintiff in good faith entered into an agreement for sale with the defendants on 5^thFebruary, 2016 for purchasing the suit property for a consideration of Rs.8,00,00,000/- (Rupees eight crore only). He further claimed that he has paid a sum of Rs.51,00,000/- (Rupees fifty one lakh only) by cash to the defendants towards earnest money. Plaintiff further claimed that after execution of the said

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agreement, the defendants handed over xerox copies of the title deed relating to the suit property, tax bill etc.

Plaintiff further claimed that on repeated occasion he requested the defendants to complete the said transaction by executing and registering the sale deed after receiving the balance consideration amount. He also asserted that a legal notice was also served upon the defendants requesting them to compete the said transaction on acceptance of the balance consideration money, but the defendants did not respond to such request.

Plaintiff further contended that in spite of receiving the earnest money, the defendants are now taking steps for transferring the suit property to the stranger purchaser. Hence, he has filed the aforesaid suit.

In the application for injunction, the plaintiff has also annexed the title deed relating to the suit property. On perusal of the said title deed relating to the suit property, we find that the defendants are not the owners of the said property. The title deed annexed to the injunction application shows that Onex Projects LLP, a registered Limited Liability Partnership, is the owner of the suit property. The defendants are some of the partners of the said Limited Liability Partnership.

On reading of the pleadings of the plaintiff made out in the plaint as well as in the injunction application, we do not find that the plaintiff ever claimed to have entered into agreement for sale with the Limited Liability Partnership firm for purchasing the suit property. There is no privity of contract between the plaintiff and the Limited Liability Partnership which is the owner of the suit property. Of course, the defendants are some of the partners of the said Limited Liability Partnership firm. Plaint does not disclose that those defendants were authorised by the said Limited Liability Partnership firm to enter into any transaction relating to the suit property as agents of the said Limited Liability

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Partnership. No case of fraud has been made out against the defendants for attracting the other provisions of the Limited Liability Partnership Act, 2008, such as Section 30 etc.

Thus, on reading the pleadings of the plaintiff as a whole, it appears to us that there is no privity of contract between the plaintiff and the owner of the said property viz., the Limited Liability Partnership firm. As such, we hold that even if the ad interim order of injunction which was passed by the learned Trial Judge is not disturbed by us, still then the Limited Liability Partnership firm cannot be held to be bound by the said injunction order. The said Limited Liability Partnership firm is not even made a party to the suit.

Section 3 of the Limited Liability Partnership Act, 2008 says that a limited liability partnership is a body corporate formed and incorporated under the said Act and is a legal entity separate from that of the partners. Section 14 of the said Act provides that on registration, a limited liability partnership shall, by its name, be capable of suing and being sued. The title deed which is annexed to the injunction application shows that the Limited Liability Partnership firm is a registered partnership firm. As such, we have no hesitation to hold that the said Limited Liability Partnership firm is a separate entity which is a body corporate and is capable of being sued in its own name. The said Limited Liability Partnership firm has not been impleaded as a party in this proceeding. No relief has been claimed against the said Limited Liability Partnership firm. Since we are of the prima facie view that there is no privity of contract between the plaintiff and the owner of the suit property viz., the Limited Liability Partnership firm, we hold that the ad interim relief by way of injunction which is prayed for by the plaintiff cannot be granted in the instant case for the simple reason that even if such ad interim order of injunction is maintained, still then, the Limited Liability Partnership firm, which is not a party in the said proceeding,

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cannot be restrained from dealing with the said property by virtue of such interim order passed by the learned Trial Court.

That apart, we find that the plaintiff claims that the plaintiff has paid a sum of Rs.51,00,000/- (Rupees fifty one lakh only) by cash to the defendants by way of earnest money. No receipt regarding payment of such earnest money is forthcoming before us. Even the agreement for sale does not contain any memorandum clause showing payment and acceptance of such earnest money between the parties. The source of payment of such earnest money has also not been disclosed before us. Though the plaintiff claimed in the suit that he was ready and willing to complete the said transaction and, in fact, a legal notice was also served upon the defendants calling upon them to complete the said transaction on acceptance of the balance consideration money, but, when we asked the learned advocate appearing for the plaintiff/respondent to take instruction from his client as to whether his client is ready to deposit the balance consideration money in Court, the learned advocate appearing for the plaintiff/respondent after taking instruction from his client, who is present in Court, informs us that his client cannot deposit the entire balance consideration money in Court presently. He, however, submits that his client will be able to arrange the balance consideration money within the stipulated period fixed in the contract for completion of the sale.

Since the plaintiff himself averred in the pliant that he is ready with the money and wanted to complete the said transaction, but now expressed his inability to deposit the balance consideration money, we are of the view that the plaintiff is unable to satisfy our conscience about his readiness to complete the said transaction on payment of the balance consideration money. The legal notice which was served for calling upon the defendants to complete the said transaction does not justify the stand which the plaintiff has now taken before us about his inability to arrange the balance consideration money presently.

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Considering the facts and circumstances as stated hereinabove, we are of the view that the plaintiff has failed to make out a strong prima facie case to go for trial. As such, we feel that this is not a case where any ad interim order of injunction should be passed.

Even if, we consider the principle of balance of convenience and inconvenience, we hold that balance of convenience and inconvenience is wholly against grant of such injunction as we find that there is no privity of contract between the plaintiff and the real owner of the suit property and the real owner of the suit property has not entered into contract with the plaintiff either directly or indirectly. As such, the real owner of the suit property cannot be restrained from transferring its property.

This is also a case where the plaintiff, in case, ultimately succeeds in the suit, can get refund of the earnest money provided that he can prove that he paid the said amount of earnest money to the defendants in pursuance of the said contract provided however the said contract is ultimately found to be incapable of being performed specifically. In our view, injunction is not the appropriate relief where the loss can be compensated by necessary decree.

We, thus, hold that the impugned order which was passed by the learned Trial Judge cannot be allowed to be retained on record. The impugned order, thus, stands set aside. The appeal is, thus, allowed.

We direct the defendants to file affidavit-in-opposition to the plaintiff's application for temporary injunction within two weeks from date; reply, if any, be filed by the plaintiff within a week thereafter.

The learned Trial Judge is requested to dispose of the plaintiff's application for temporary injunction as expeditiously as possible, but preferably by the end of August 2016.

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Since we have decided the appeal at the stage of ad interim order of injunction, we make it clear that the learned Trial Judge is absolutely free to decide the plaintiff's application for temporary injunction on its own merit without being influenced by any of the observations made hereinabove which are made by us only for the purpose of disposal of the appeal which is directed against an ad interim order of injunction.

Both the appeal and application being CAN 4980 of 2016 thus stand disposed of.

Urgent photostat certified copy of this order, if applied for, be given to the parties as expeditiously as possible.

(JYOTIRMAY BHATTACHARYA, J.)

( ISHAN CHANDRA DAS, J. )

dc.

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