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CASE NO.: Appeal (civil)  3596 of 2006

PETITIONER: Rangnath Haridas

RESPONDENT: Dr. Shrikant B. Hegde

DATE OF JUDGMENT: 22/08/2006

BENCH: S. B. SINHA & DALVEER BHANDARI

JUDGMENT: J U D G M E N T [Arising out of SLP(C) Nos.24511-24512/2004]

DALVEER BHANDARI, J.

       Leave granted.

       By the order dated 17.08.2004, Chamber Summons  No. 1460 of 2003 in Execution Application No. 388 of  2003 in Suit No. 3550 of 1990 was made absolute by the  Single Judge of the High Court of Bombay.   

       Aggrieved by the said order of the Single Judge, the  appellant-defendant filed an appeal before the Division  Bench.  The Division Bench of the Bombay High Court  dismissed the said appeal (Appeal No. 672 of 2004) by an  order dated 21.10.2004.    

       The appellant aggrieved by the aforesaid orders of  the learned Single Judge and the Division Bench has  preferred this civil appeal before this Court.                  The brief facts which are necessary to dispose of  this appeal is recapitulated as under:

       The respondent-plaintiff entered into an agreement  with the appellant for the purchase of a flat on  16.9.1985.   Despite making part payment, when the  appellant did not perform his part of the agreement, the  respondent filed a Suit No. 3550 of 1990 in the High  Court of Bombay for seeking specific performance of the  agreement dated 16.9.1985.  

       During the pendency of the suit, the parties have  amicably settled the dispute involved in the suit and filed  the consent terms on 1.11.1991.   The details of the  Chamber Summons and the consent terms incorporated  in the order of the learned Single Judge are reproduced  hereinafter for proper appreciation of the facts of this  case. "that pending the above Execution Application,  this Hon’ble Court be pleased to appoint the  Court Receiver, High Court, Bombay with all  powers under Rule XL rule 1 of C.P.C. 1908  with further directions to the Court Receiver,  High Court, Bombay, to take possession of Flat

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No.B-4, 2nd Floor, Golden Height, situated at  Anant Patil Marg, Dadar Mumbai 400 028 with  further directions to the Court Receiver to  appoint Architect and Contractor from panel of  this Hon’ble Court to get the said incomplete  work completed as mentioned in the report  dated 29th November, 1999 filed by M/s  Nandkarni & Co. in Notice of Motion no.2660  of 1999 and to obtain part Occupation  Certificate from the Municipal Corporation of  Greater Mumbai, in respect of the said flat  with further directions to hand over quiet,  vacant and peaceful possession of the said flat  to the plaintiff as per consent decree dated 1st  November, 1991."

       The consent terms contained the  following clauses: "2.     The parties confirm that the agreement  dated 16.9.1985 between them is valid  and subsisting and the same is binding  on the parties.

3.      The Defendant hereby confirm having  received Rs.2,35,000/- from the plaintiff  as per the agreement dated 16.9.1985.

5.      The Defendant states that as per the said  proposed plan there are no flats  admeasuring about 750 sq.ft. in both the  Wings of the proposed buildings.  But  there are flats admeasuring about 935 sq.  ft. (super built up area) in the said  building and the plaintiff has agreed to  purchase a flat admeasuring 935 sq. ft.  on further payment of Rs.6,00,000/-  which the plaintiff has agreed to  purchase the flat on 2nd floor in Wing ’B’  Western Side on the following terms.

6.      The Defendant to sell and to entrust to  the plaintiff flat No.B-4 on the 2nd Floor of  B-Wing (super built up area) of the  building on plaintiff’s paying the sum of  Rs.6,00,000/- in addition to  Rs.2,35,000/- already paid by him to the  plaintiff in the following manner:

       Rs.3,00,000/- prior to  the  execution  of  these    terms by  pay order No. 466770 dated  31.10.1991 at   the time of  Defendant handing over quiet,  vacant  and peaceful  possession of Flat No.B-4, 2nd  Floor, B-       Wing at Anant Patil  Marg, Shivaji Park, Dadar  (West) Bombay \026 400028.

7.      The Defendant agrees and undertakes to  provide the aforementioned flat with all  modern facilities to the plaintiff, after the  said building is ready for occupation.   The Defendant agrees and undertakes to

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execute separate agreement to sell in  respect of the aforementioned flat  admeasuring 925 sq. ft. (super built up  area) in favour of the plaintiff as required  by the Maharashtra Ownership Flat Act,  1964 within eight weeks from the  execution of these terms and the plaintiff  agrees and undertakes to pay stamp duty  and registration charges as applicable  on  the agreement registered before the Sub- Registrar of Assurances at the earliest as  required by the said Act.

11.     The Defendant hereby agrees and  undertakes to hand over quiet, vacant  and peaceful possession of Flat No.B-4,  2nd Floor, B-Wing at Anant Patil Marg to  the Plaintiff on his paying the entire  consideration mentioned hereinabove and  after completing the construction of the  entire building wherein the said flat is  situated and the said flat is ready for  occupation.

13.     The Minutes of the order dated 16th day  of September, 1991 passed by their  Lordships Chief Justice P.D. Desai and  Mr. Justice Tipnis in Appeal No.622 of  1991 shall remain in force until the  Defendant hands over possession of the  said flat to the plaintiff on plaintiff’s  paying the entire consideration  mentioned hereinabove."

       The learned Single Judge further examined the  matter and observed as under: "Clause 2 of the Minutes of the order dated  16th September, 1991 referred to in Clause 13  above read as under:-

       "The Respondent/Defendant  states that there is no flat  admeasuring 750 sq. ft. in the  proposed building. However, there is  a flat of 935 sq. ft. on second floor  (Right Side) which at present is not  agreed to be sold to anyone.  The  Respondent states that without  prejudice to his rights and  contentions the Respondent shall  not enter into any agreement for  sale in respect of said flat unless he  has given seven days clear notice to  the Appellant’s Advocate, during  which period the Appellant shall be  at liberty to adopt appropriate  proceedings before trial court for  appropriate reliefs.  The Respondent  shall also be at liberty to urge all  contentions as are permissible to  him in law."

       By an order dated 10th August, 1999, S.S.  Nijjar, J. held that the Defendants had failed

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and neglected to comply with the above order.   His Lordship observed that the Defendants  had committed contempt of court.  In the  circumstances, the learned Judge in order to  protect the interest of the Plaintiff granted ad- interim relief in terms of prayer (a) of the  Notice of Motion No.2660 of 1999.  However,  that Notice of Motion was withdrawn with  liberty to adopt appropriate proceedings.  A  further Notice of Motion No.1701 of 2002 for  similar reliefs was also withdrawn, as reflected  from the order dated 30th July, 2001.  The  explanation that the aforesaid Notices of  Motion were withdrawn for the purpose of  adopting appropriate proceedings, is accepted.

       The present Chamber Summons is taken  out in execution proceedings, which is the  proper remedy.

       There is no answer on the merits of the  case whatsoever.  The only answer sought to  be given is that there was an alleged oral  understanding prior to the execution of the  consent terms dated 1st November, 1991.  The  same is unsustainable, in view of the fact that  the consent terms are still valid and binding.

       The defendant has not complied with any  of his obligations including the obligation  under clause 7 of the consent terms.  There is  an open defiance of the order.

       The learned counsel appearing on behalf  of the Defendant further stated that there is an  order of attachment in respect of Flat No.B-3  passed by the Debt Recovery Tribunal in  respect of the dues of SICOM.  Admittedly an  M.O.U. dated 9th July, 1996 was entered into  between the Defendant and Dinesh Anant  Rane for Flat No.B-3.  That flat however, is not  the subject matter of this suit.  The learned  counsel for the Defendant further stated that  there is no wall between flat No.B-4 i.e. the  suit flat and flat No.B-3.  He further states that  the possession of flat No.B-4 was never handed  over to the said Rane and that Rane does not  have any right in respect thereof.  The warrant  of attachment therefore, on its own showing  does not apply to the suit flat.  In fact had the  Defendant sought to create any right in respect  of flat No.B-4 i.e. the suit flat in favour of Rane  or anyone else, it would have been contempt of  the aforesaid orders of this Court.  In the  circumstances, there can be no objection to  the grant of reliefs in the present Chamber  Summons.

       The Chamber Summons is made absolute  in terms of Prayer (a).  The Court Receiver  shall erect a wall at the appropriate place  between flat Nos.B-3 and B-4.  The defendant  shall pay the costs of this Chamber Summons  fixed at Rs.5000/- within two weeks from  today.  The Defendant shall also pay the cost

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of construction of the wall to the Court  Receiver within four weeks of a demand for the  same by the Court Receiver.

       The operation of this order is stayed for a  period of four weeks from today to enable the  Defendant to carry the matter higher.

       The Chamber Summons is accordingly  disposed of."

       The appellant aggrieved by the said order preferred  Appeal No.672 of 2004 before the Division Bench of the  Bombay High Court.  The submission before the Division  Bench was that the impugned leave under Order 21 Rule  22 CPC having not been sought by the respondent, the  impugned order is illegal.  The Division Bench rejected  the objection on the ground that this plea was not raised  before the learned Chamber Judge.   

       The learned Chamber Judge held that the consent  terms were valid and subsisting and accordingly passed  the impugned order.  The Division Bench did not find any  infirmity in the order passed by the learned Chamber  Judge and consequently the appeal filed by the appellant  was dismissed.         The appellant aggrieved by the aforesaid orders  dated 17th August, 2004 and 21st October, 2004 passed  by the learned Single Judge and the Division Bench  respectively has preferred this civil appeal before this  Court.  

       We have heard the learned counsel for the parties  and perused the order of the Division Bench and the  order of the learned Chamber Judge.  The consent terms  submitted between the parties are as under:   "1.     The defendant abovenamed waives the  service of Writ of Summons in the above  matter.

2.      The parties confirm that the agreement  dated 16.9.1985 between them is valid  and subsisting and the same is binding  on the parties.

3.      The defendant hereby confirms having  received Rs.2,35,000/- from the Plaintiff  as per the agreement dated 16.9.1985.

4.      The defendant states that he has  submitted the plan in respect of Plot  No.707 T.P.S. No.IV for development of  the said property to the Municipal  Corporation of Greater Bombay and the  same is to be sanctioned by the  Municipal Corporation of Greater  Bombay.

5.      The defendant states that as per the said  proposed plan there are no flats  admeasuring about 750 sq. ft. in both the  wings of the proposed buildings.  But  there are flats admeasuring about 925 sq.  ft. (super built up area) in the said

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building and the Plaintiff has agreed to  purchase a flat admeasuring 925 sq. ft.  on further payment of Rs.6,00,000/-  which the plaintiff has agreed to  purchase the flat on 2nd floor in Wing B  Western Side on the following terms  :

6.      The defendant to sell and to entrust to  the plaintiff flat No.B-4 on the 2nd floor of  B-Wing (super built area) of the building  on plaintiff’s paying the sum of  Rs.6,00,000/- in addition to  Rs.2,35,000/- already paid by him to the  plaintiff in the following manner :

Rs.3,00,000/- prior to the execution  of these terms by Pay Order No.466770  dated 31.10.1991 drawn on Canara  Bank, Dadar (West) Branch;  Rs.3,00,000/- at the time of the  defendant handing over quiet, vacant and  peaceful possession of Flat No.B-4, 2nd  floor, B-Wing at Anant Patil Marg, Shivaji  Park, Dadar (West), Bombay-400028

7.      The defendant agrees and undertakes to  provide the aforementioned flat with  all  modern facilities to the plaintiff, after the  said building is ready for occupation.   The defendant agrees and undertakes to  execute separate agreement to sell in  respect of the aforementioned flat  admeasuring 925 sq. ft. (super built up  area) in favour of the Plaintiff as required  by Maharashtra Ownership Flat Act,  1964 within eight weeks from the  execution of these terms and the plaintiff  agrees and undertakes to pay stamp duty  and registration charges as applicable on  the agreement registered before the Sub- Registrar of Assurances at the earliest as  required by the said Act.

8.      The plaintiff agrees and undertakes to  pay the additional sum of Rs.6,00,000/-  (in addition to Rs.2,35,000/- paid by him  as per the agreement dated 16th  September 1985 Ex.A to the plaint, in the  manner stated hereinabove.

9.      The plaintiff agrees and undertakes to  reconvey to the Defendant that the land  bearing S. No. 25 (Gate No.255) 2 of  Village Loni Kalbhor, Taluka Haveli,  District Pune, admeasuring about 324 sq.  metres within four weeks from the date of  the execution of these terms.  It is  expressly agreed by and between the  parties hereto that all the expenses  towards the stamp duty, registration etc.  in respect of such reconveyance shall be  borne by the defendant.

10.     The plaintiff has been advised that it is  not required to obtain necessary

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certificate under Section 37(1) of the  Income Tax Act since the consideration of  the suit flat is less than Rs.10,00,000/-.   However, the plaintiff agrees and  undertakes to obtain necessary certificate  under Section 37(1) of the Income Tax if  and when required.  It is expressly agreed  by and between the parties and payment  of registration charges if any and the  plaintiff agree and undertakes to bear the  aforementioned expenses towards  obtaining 37(1) if required and getting the  said agreement registered. 11.     The defendant hereby agrees and  undertakes to hand over quiet, vacant  and peaceful possession of Flat No.B-4,  2nd floor B-Wing at Anant Patil Marg to  the plaintiff on his paying the entire  consideration mentioned hereinabove and  after completing the construction of the  entire building wherein the said flat is  situated and the said flat is ready for  occupation.

12.     The plaintiff agrees and undertakes to  abide by the terms and conditions that  may be mentioned in the proposed  agreement that may be executed in his  favour by the defendant and join the co- operative body of the flat purchasers in  the suit building in whose favour the  defendant will execute the conveyance to  be executed in respect of the said land in  the said proposed building.

13.     The Minutes of Order dated 16th of  September 1991 passed by their Lordship  Chief Justice P.D. Desai and Mr. Justice  Tipnis in Appeal No.622 of 1991 shall  remain in force until the Defendant  hands over possession of the said flat to  the plaintiff on plaintiff’s paying the  entire consideration mentioned  hereinabove."

                        Clauses 9, 10 and 12 of the said Consent Terms  categorically state that there had been some mutual  obligations on the part of both the parties.   

The appellant herein contends that despite such  reciprocal obligations on the part of the parties, the  plaintiff-respondent did not fulfill his obligation in  terms thereof.  It was in the aforementioned context,  another arrangement was said to have been arrived at  on 27.07.1995, pursuant whereto and in furtherance  whereof, the respondent herein offered to take an  amount of Rs.32 lakhs enabling him to purchase the  flat of his choice in the vicinity instead of the  concerned flat for which the appellant herein agreed to  pay the said amount.   

For the reasons stated hereinafter, we may not  consider that part of submissions of the learned  counsel for the purpose of this case.

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It appears that a notice of motion was filed before  the High Court by way of a Chamber summons, which  was supported by an affidavit affirmed by the  respondent herein.  In the said affidavit, although the  other clauses of the consent terms entered into by and  between the parties on 01.11.1991 had been  mentioned but erroneously clauses 9 and 10, which  impose obligation on his part, had been omitted.  We  do not appreciate such deliberate omission on the part  of the respondent.  The said notice of motion was  withdrawn on 30.07.2001.  In the Counter Affidavit  filed before us, the respondent, however, stated:         "I say and submit that I have always been  and I am ready and willing to fulfill my  obligations under the said consent terms and I  have always been and I am ready and willing  to pay the balance amount of Rs.3,00,000/-  which is payable by me against the possession  of the said flat.  I say and submit that it may  not be out of place to mention here that on or  before execution of the said consent terms, I  have paid Rs.5,35,000/- to the Petitioner  abovenamed.  Out of the said consideration of  Rs.5,35,000/-, Rs. 2,35,000/- was paid by me  way back  in 1985.  It may not be out of place  to mention here that vide clause 9 of the said  consent terms/consent decree, I had agreed  and undertaken to reconvey to the Petitioner  land bearing Survey No.25 (Gate No.255) of  Village Loni, Kalbhor, Taluka Haveli, District  Pune admeasuring about 324 sq. metres  within four weeks from the date of execution of  the said consent terms.  However, as per the  said clause, the Defendant had agreed to incur  the expenses towards stamp duty, registration  charges for execution of the said reconveyance  of the said property in his favour.  However, till  the Petitioner has not taken any steps on that  behalf.  I am always ready and willing to  reconvey the said property as and when called  upon to do so."   

       The submission of the learned senior counsel  appearing on behalf of the appellant is that the High  Court committed a serious error in passing the  impugned judgment, without noticing that :  (i)  the  consent order was followed by subsequent settlement;  (ii) the reciprocal obligations had not been fulfilled; and  (iii) no leave had been obtained under Order 21 Rule  22 of the Code of Civil Procedure.      

       Mr. Arvind Sawant, the learned senior counsel  appearing on behalf of the respondent, on the other  hand, would draw our attention to the impugned  judgment.  With reference to para 9 of the consent  terms, the learned counsel would submit that his  client is ready and willing to comply with the said term  also.  Our attention in this connection has been drawn  to the fact that the respondent had taken out notice  under Order 21 Rule 22 of the CPC, when the  appellant intended to create a third party interest.   

       Having heard the learned counsel for the parties,

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we are of the opinion that as the High Court as also  this Court are acting on the basis of the terms of the  consent decree, the reciprocal obligations of the parties  should be directed to be acted upon simultaneously.   

       We are not satisfied that the consent terms were  in any manner substituted by another agreement  between the parties.  We, therefore, are of the opinion  that the parties should be directed to give effect to the  terms of the consent decree.  We have noticed  hereinbefore, whereas the appellant herein is to  handover the flat to the respondent, the respondent  was also  obligated to transfer the land situated in the  District of Pune.  Both the parties have failed to  comply with their mutual obligations.    

       We, therefore, direct as under:    1)      The appellant shall handover possession of Flat  No.B-4, 2nd Floor,  B-Wing,  Anant Patil Marg,  Shivaji Park, Dadar (West), Mumbai-400 028 to  the  respondent herein, wherefor the requisite  partition wall, if any, should be constructed.  In  case of any doubt or dispute as to the exact area  of the flat in question, a surveyor may be  appointed to demarcate the said flat and ensure  construction of a wall between Flat No.B-3 and B- 4.  The appointment of surveyor, if any, should be  undertaken within three weeks from date.  The  respondent shall bear the expenses therefor.  The  respondent shall also bear all costs for  preparation of documents, stamp duties and  registration costs, etc., if any, thereafter transfer  of the said property.     

2)      The appellant would be entitled to withdraw the  amount of Rs.3,00,000/- deposited by the  respondent herein with the Court Receiver, which  sum is over and above the amount of   Rs.5,35,000/- paid by the respondent to the  appellant.  We have been assured that there is no  shortfall in the entire amount of consideration.  

3)      The respondent shall execute a contract in the  same format which the other allottees of the  building had undertaken in regard to  maintenance etc. of the said flat.   

4)      The respondent shall execute a deed of  conveyance in favour of the appellant herein in  respect of the land being Survey 25 (Gate No.255)  situated at Village Loni Lalbhor, Taluka Haveli,  District Pune, admeasuring 324 sq. metres within  four weeks from date.  He shall also handover  vacant peaceful possession thereof within six  weeks.  The appellant shall pay and bear the  costs for requisite stamp papers as also the  registration charges.

       The appeal is disposed of accordingly.  In the facts  and circumstances of this case, the parties are directed  to bear their own costs. 27960