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Smart Summary

Factual and Procedural Background

The appellant instituted Special Civil Suit No.499 of 2018 seeking cancellation of a registered sale deed dated 05.01.2016 in favour of the respondent, relating to Shop No.19 in 'Akshar Co-operative Housing Society Limited' known as 'Millennium Plaza'. The appellant contended that the sale deed was executed without consideration and possession was not handed over to the respondent. The appellant alleged non-payment of the balance sale consideration amounting to Rs.9,00,000/- and had entered into a leave and license agreement with a third party due to this default. The appellant filed an application for interim injunction to restrain the respondent from transferring or encumbering the suit property. The learned 2nd Additional Senior Civil Judge, Ahmedabad Rural, rejected this injunction application by order dated 29.03.2019. The appellant filed the present Appeal From Order under Order 43 Rule 1 of the Civil Procedure Code challenging the rejection of the injunction application.

Legal Issues Presented

  1. Whether the appellant has made out a prima facie case for granting interim injunction restraining the respondent from transferring or encumbering the suit property pending final disposal of the suit?
  2. Whether the appellant would suffer irreparable injury if the injunction is not granted?
  3. Whether the balance of convenience lies in favour of granting the injunction to maintain the status quo?

Arguments of the Parties

Appellant's Arguments

  • The sale deed dated 05.01.2016 was executed without any consideration being paid by the respondent.
  • The possession of the suit property remains with the appellant, who had to enter into a leave and license agreement with a third party due to non-payment of the balance amount.
  • The appellant apprehends that the respondent may sell or encumber the property based on the sale deed.
  • The injunction application was necessary to prevent transfer or encumbrance until the suit is finally decided.

Respondent's Arguments

  • The respondent is the lawful owner of the suit property by virtue of the registered sale deed dated 05.01.2016.
  • Documentary evidence such as electricity bills and municipal tax bills were produced showing respondent’s possession and payment of bills since 2015.
  • The appellant’s execution of leave and license agreement with a third party was dishonest and an attempt to circumvent the legal process.
  • The respondent had paid part consideration in accordance with the sale deed and therefore the injunction was rightly refused by the trial court.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Martin Burn Limited vs. R.N. Banerjee, AIR 1958 SC 79 Principles for granting temporary injunction: existence of prima facie case, irreparable injury, and balance of convenience. The Court reiterated that a prima facie case does not require proof to the hilt but a case that can be established if evidence is believed. The Court applied the three pillars test to decide on the injunction application.

Court's Reasoning and Analysis

The Court acknowledged the appellant’s claim that the sale deed was executed without full payment of consideration and that possession was not handed over, leading to the appellant entering into a leave and license agreement with a third party. The respondent’s claim of ownership was supported by documentary evidence including electricity and municipal tax bills indicating possession since 2015. The Court emphasized the discretionary nature of granting temporary injunctions and the necessity to apply the established three-fold test: prima facie case, irreparable injury, and balance of convenience. The Court clarified that at the injunction stage it is not to decide the suit finally or resolve conflicting evidence but to examine whether a possible view exists in favour of the appellant. Considering the submissions and with consent of both parties, the Court found it just to direct maintenance of status quo regarding the nature, character, and possession of the suit property until final disposal of the suit, thereby balancing the interests of both parties.

Holding and Implications

The appeal from order is disposed of with directions to maintain status quo regarding the suit property until the final disposal of the suit.

The direct effect of this decision is that neither party shall alter the possession, nature, or character of the suit property pending the final adjudication of the suit. No new precedent was established; the Court’s order is an exercise of its equitable discretion to preserve the status quo and prevent potential prejudice to either party during the pendency of litigation.

    RAMESHBHAI KARMANBHAI GARCHAR v. GHANSHYAMBHAI JETHABHAI BHARWAD

    C/AO/119/2021 ORDER DATED: 24/11/2021

    IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

    R/APPEAL FROM ORDER NO. 119 of 2021 With

    CIVIL APPLICATION (FOR STAY) NO. 1 of 2019

    In R/APPEAL FROM ORDER NO. 119 of 2021 =============================================

    RAMESHBHAI KARMANBHAI GARCHAR

    Versus

    GHANSHYAMBHAI JETHABHAI BHARWAD

    ============================================= Appearance:

    MR ANKIT SHAH(6371) for the Appellant(s) No. 1 MR SWAPNIL H CHAUHAN(5959) for the Respondent(s) No. 1 =============================================

    CORAM: HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI

    Date : 24/11/2021

    ORAL ORDER

    1. This is an Appeal From Order filed under Order 43 Rule 1 of the Civil Procedure Code by the appellant herein being aggrieved and dissatisfied with the order dated 29.03.2019 passed below Exh.5 by the learned 2ndAdditional Senior Civil Judge, Ahmedabad Rural in the Special Civil Suit No.499 of 2018. The operative part of the order passed below Exh.5 reads thus: (true translation)

    ":ORDER:

    1) The Injunction Application of the plaintiff is hereby rejected.

    2) Cost of the application shall follow the final outcome of the suit.

    Pronounced in the open court today on 29thMarch, 2019."

    2. The appellant herein has instituted Regular Civil Suit No.499 of 2018 seeking following reliefs, which reads thus:

    (true translation)

    Page 1 of 9

    "9) Therefore, the plaintiff prays that:

    (a) Sale Deed, on paper, without consideration and without possession, has been executed in favour of the defendants, which is registered with the Office of Sub-Registrar on 05/01/2016 under Sr.No.102 for the property in suit bearing Shop No.19, having construction admeasuring about 385 Sq. Feet (Carpet Area) i.e. 35.76 Sq. Mts. on First Floor in Block No.B alongwith undivided share admeasuring 15 Sq. Mts. in the land of the society togetherwith common rights and share of the society out of the shops and offices of 'Akshar Co-operative Housing Society Limited' known as 'Millennium Plaza' situated on Non-Agricultural Land bearing Final Plot No.33 of T.P. Scheme No.1, Old Revenue Survey No.116/2 paiki, City Survey No.717 of Moje: Vastrapur village of Vejalpur Taluka in the District Sub-District Ahmedabad-3 (Memnagar) and no consideration has been taken from the defendants for the said sale deed and therefore, kindly pass the decree in favour of the plaintiff declaring the said sale deed to be canceled and void as it is without consideration, without possession, un-alienated, unlawful, fabricated, illegal in the eyes of law and de facto illegal.

    (b) Sale Deed, on paper, without consideration and without possession, has been executed in favour of the defendants, which is registered with the Office of Sub-Registrar on 05/01/2016 under Sr.No.102 for the property in suit bearing Shop No.19, having construction admeasuring about 385 Sq. Feet (Carpet Area) i.e. 35.76 Sq. Mts. on First Floor in Block No.B alongwith undivided share admeasuring 15 Sq. Mts. in the land of the society togetherwith common rights and share of the society out of the shops and offices of 'Akshar Co-operative Housing Society Limited' known as 'Millennium Plaza' situated on Non-Agricultural Land bearing Final Plot No.33 of T.P. Scheme No.1, Old Revenue Survey No.116/2 paiki, City Survey No.717 of Moje: Vastrapur village of Vejalpur Taluka in the District Sub-District Ahmedabad-3 (Memnagar). The plaintiff has not taken any consideration for the said sale deed and the possession is not handed over to the defendants. Therefore, kindly pass perpetual injunction order and decree against the defendants that on the basis of the said Sale Deed without Consideration, the defendants do not transfer by any kind of document such as agreement, exchange deed, agreement for sale, sale deed, power of attorney etc. to any third party and do not transfer or assign by creating charge, loan or encumbrance on the suit property in the interest of justice.

    (b) Kindly pass any other order that you may deem fit and proper.

    (c) Kindly grant the cost of this suit from the defendants.

    10) Considering the value of the suit at Rs.19,71,000/-, Requisite Court Fee Stamp of Rs.36,000/- is affixed thereon.

    11) Name and address of the plaintiff mentioned in the title of the suit is true and correct as per Order-6, Rule-14(a) of the

    Page 2 of 9

    CPC.

    12) Vakil Patra, List, Address Pursis, Copy of the court, Affidavit, Interim Injunction Application, Application to appoint Court Commissioner and copies of the defendants are appended herewith."

    3. The application below Exh.5 came to be filed by the appellant seeking following reliefs, which reads thus:

    (true translation)

    "9) Therefore, the plaintiff prays that:

    (a) Sale Deed, on paper, without consideration and without possession, has been executed in favour of the defendants, which is registered with the Office of Sub-Registrar on 05/01/2016 under Sr.No.102 for the property in suit bearing Shop No.19, having construction admeasuring about 385 Sq. Feet (Carpet Area) i.e. 35.76 Sq. Mts. on First Floor in Block No.B alongwith undivided share admeasuring 15 Sq. Mts. in the land of the society togetherwith common rights and share of the society out of the shops and offices of 'Akshar Co-operative Housing Society Limited' known as 'Millennium Plaza' situated on Non-Agricultural Land bearing Final Plot No.33 of T.P. Scheme No.1, Old Revenue Survey No.116/2 paiki, City Survey No.717 of Moje: Vastrapur village of Vejalpur Taluka in the District Sub-District Ahmedabad-3 (Memnagar). The plaintiff has not taken any consideration for the said sale deed and the possession is not handed over to the defendants. Therefore, kindly pass an interim injunction order against the defendants that on the basis of the said Sale Deed without Consideration, the defendants do not transfer by any kind of document such as agreement, exchange deed, agreement for sale, sale deed, power of attorney etc. to any third party and do not transfer of assign by creating charge, loan or encumbrance on the suit property, till the final disposal of the suit, in the interest of justice.

    (b) Kindly pass any other order that you may deem fit and proper.

    (c) Kindly grant the cost of this injunction application from the defendants.

    10) Requisite Court Fee Stamp affixed on this injunction application.

    11) Affidavit annexed herewith."

    4. The brief facts leading to the filing of the present Appeal From Order may be summarized as under:

    Page 3 of 9

    4.1 The dispute involved in the present Appeal From Order is with regard to the shop being Shop No.19, having construction admeasuring about 385 Sq. Feet (Carpet Area) i.e. 35.76 Sq. Mts. on First Floor in Block No.B alongwith undivided share admeasuring 15 Sq. Mts. in the land of the society together with common rights and share of the society out of the shops and offices of 'Akshar Co-operative Housing Society Limited' known as 'Millennium Plaza' situated on Non-Agricultural Land bearing Final Plot No.33 of T.P. Scheme No.1, Old Revenue Survey No.116/2 paiki, City Survey No.717 of Moje: Vastrapur village of Vejalpur Taluka in the District Sub-District Ahmedabad-3 (Memnagar).

    4.2 It is the case of the appellant - original plaintiff that the appellant and the respondent entered into a registered sale deed on 05.01.2016 being Registration No.102 for total consideration of Rs.19,70,000/-. It is further the case of the appellant that the respondent paid an amount of Rs.10,70,000/- by cash however, an amount of Rs.9,00,000/- was due and payable pursuant to the recital in the sale deed dated 05.01.2016. Since the respondent failed to make the payment, the appellant was constrained to enter into leave and license agreement with the third party. In such circumstances, the appellant herein was constrained to file the Special Civil Suit No.499 of 2018 before the Court of 2nd Additional Senior Civil judge, Ahmedabad Rural. The application filed by the appellant below Exh.5 also came to be rejected by order dated 29.03.2019 passed by the 2nd Additional Senior Civil judge, Ahmedabad Rural in the Special Civil Suit No.499 of 2018.

    Page 4 of 9

    5. Heard Mr. Ankit Shah, the learned counsel appearing for the appellant and Mr. Swapnil Chauhan, the learned counsel appearing for the respondent.

    6. Mr. Ankit Shah, the learned counsel appearing for the appellant submitted that the Court below had committed an error by refusing injunction in favour of the appellant. Mr. Shah, submitted that though the appellant had sold out the disputed shop to the respondent no.1 by registered sale deed being sale deed No.102 on 05.01.2016, the appellant did not receive any amount towards consideration for the shop. Mr. Shah, also submitted that the Court below had erred in appreciating the fact that the possession of the shop is with the appellant. Mr. Shah, further submitted that the appellant has given disputed shop to some other person on agreement of leave and license dated 28.08.2018. Under such circumstances, Mr. Shah, the learned counsel appearing for the appellant submitted that the appellant has apprehension that the respondent will sale the suit property on the strength of the sale deed in his favour dated 05.01.2016.

    7. Mr. Swapnil Chauhan, the learned counsel appearing for the respondent has relied upon the written arguments, which were given in the Court below. Mr. Chauhan, submitted that the Court below has rightly rejected the injunction to the fact that the respondent is the owner of the suit shop by way of a registered sale deed entered into between the appellant and the respondent on 05.01.2016. Mr. Chauhan, has relied upon the following documentary evidences to substantiate his case as produced in the suit proceedings:

    1. Torrent Electricity Bill

    Page 5 of 9

    2. Municipal Corporation Tax Bill

    3. Index Copy

    7.1 Relying upon the aforesaid documents, Mr. Chauhan, the learned counsel, submitted that the respondent is paying the electricity bills since 2015 till the filing of the Suit i.e. 2017- 2018. Mr. Chauhan, further submitted that since the appellant having sold the property by registered sale deed to the respondent could not have with dishonest motive entered into leave and license agreement with third party. The present Suit filed by the appellant is with intention to over reached the process of law. The respondent has paid part consideration in terms of the sale deed dated 05.01.2016. In view of above, since the respondent is the owner of the Suit property by way of registered sale deed dated 05.01.2016, the Court below has rightly rejected the relief of injunction to the appellant. Analysis:-

    8. It is the case of the appellant herein that the appellant entered into a sale deed with the respondent by registered sale deed being No.102 dated 05.01.2016. The respondent paid amount of Rs.10,70,000/- by making cash payment in accordance with the terms and conditions of the sale deed. It is further the case of the appellant that an amount of Rs.9,00,000/- (Rs.3.15 lacs+Rs.2.85 lacs+Rs.3.00 lacs) which were also payable by the respondent in accordance with the same sale deed, was not complied with and paid by the respondents. The said amount being unpaid, the appellant herein was constrained to enter into a leave and license agreement executed by the appellant in favour of Jalpa R. Radia for 11 months on 25.08.2018. Under such

    Page 6 of 9

    circumstances, the appellant herein filed the Special Civil Suit No.499 of 2018 seeking the cancellation of sale deed dated

    05.01.2016.

    9. Per contra, it is the case of the respondent herein that the respondent is the owner of the suit property by registered sale deed dated 05.01.2016. The respondent has relied upon the documentary evidence which is also forming a part of the record of the suit proceedings as referred to above.

    10. The grant of temporary injunction is at the discretion of the Court. The discretion, however, should be exercised reasonably, judiciously and on sound legal principles. The injunction should not be lightly granted as it adversely affects the other side. The grant of injunction is in the nature of equitable relief, and such relief can be granted by imposing certain terms and conditions as deem fit by the Court. Generally, before granting the injunction, the Court must be satisfied with regard to the following three factors:

    (i) Whether the plaintiff has a prima facie case?

    (ii) Whether the plaintiff would suffer irreparable injury if his prayer for temporary injunction is not granted?

    (iii) Whether the balance of inconvenience is in favour of the plaintiff?

    11. These are the "three pillars", which are foundation of the order, on which order of injunction rests. The ratio laid down by the Supreme Court in AIR 1958 SC 79 in case of Martin Burn Limited vs. R.N. Banerjee reads thus:

    "The Labour Appellate Tribunal bad to determine on these

    Page 7 of 9

    materials whether a prima facie case had been made out by the appellant for the termination of the respondent's serv- ice. A prima facie case does not mean a case proved to the hilt but a case which can be said to be established if the evidence which is led in support of the same were believed. While determining whether a prima facie case had been made out the relevant consideration is whether on the evidence led it was possible to arrive at the conclusion in question and not whether that was the only conclusion which could be arrived at on that evidence. It may be that the Tribunal considering this question may itself have arrived at a different conclusion. It has, however, not to substitute its own judgment for the judgment in question. It has only got to consider whether the view taken is a possible view on the evidence on the record."

    12. While deciding whether the appellant has been able to make out a prima facie case, the same should not be confused with a case proved to the hilt. It is not part of the Court's function at that stage considering granting of temporary injunction to try to resolve a conflict of evidence nor to decide complicated questions of law and fact which call for detailed arguments and mature considerations. "These are matters to be dealt with at the trial." In other words, the Court should not examine the merits of the case closely at that stage because it is not expected to decide the suit finally. While deciding a prima facie case, the Courts are guided by the plaintiff's case revealed in the plaint, affidavits or materials produced by him. Once prima facie case is made out, the cause "irreparable injury" to the parties seeking relief and he needs to be protected from the consequences of apprehended injury. The same would be followed by balance of (in)convenience i.e. to exercise balance of (in)convenience, the Court must be satisfied that the comparative mischief, hardship or inconvenience, which is likely to be caused to the applicant by refusing the injunction will be greater than that which will be likely to be caused to the opposite party by granting it. "Status quo" means "existing condition" or "existing state of things" at

    Page 8 of 9

    any given point of time.

    13. Prima facie, in view of this Court and with the consent of learned advocates appearing for both the sides, interest of justice will be served if both the parties are directed to maintain the status quo with regard to the nature, character and possession of the suit property till the final disposal of the Suit.

    14. Accordingly, the parties are directed to maintain the status quo with regard to the nature, character and possession of the suit property till the final disposal of the Suit.

    15. With the aforesaid directions, the present Appeal From Order stands disposed of. The civil application also stands disposed of.

    (VAIBHAVI D. NANAVATI,J)

    NEHA

    Page 9 of 9

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    RAMESHBHAI KARMANBHAI GARCHAR v. GHANSHYAMBHAI JETHABHAI BHARWAD
    (Nov 24, 2021)