Sanjay Dhar, J
1. The appellants have challenged order dated 22.08.2023 passed by the 1st Additional District Judge, Jammu, whereby the application of the respondents/plaintiffs for grant of interim injunction has been allowed and the appellant/defendant has been inter alia temporarily restrained from dispossessing the respondents/plaintiffs from the suit property.
2. Issue notice to the respondent. Mr. Kamal Magotra, Advocate who is on caveat waives notice.
3. The appeal with the consent of learned counsel for the parties is taken up for consideration.
4. It appears that the respondents/plaintiffs filed a suit against the appellant/defendant seeking specific performance of agreement to sell dated 16.09.2021 with a consequential relief of permanent prohibitory injunction restraining the appellant/defendant from dispossessing the respondents/plaintiffs from the suit property. In the plaint, it was averred that an agreement to sell came to be executed on 16.09.2021 between plaintiffs and the defendant in respect of a residential house constructed on a piece of land measuring 10 marlas under khasra No. 436 min situated at Barnai, Tehsil Jammu. The total sale consideration of the land was fixed at Rs. 65 lacs, out of which an amount of Rs. 10 lacs was received by the defendant at the time of execution of the agreement. It was pleaded that upon receipt of the earnest money by the defendant, the plaintiffs were put into possession of the suit property. The plaintiffs are stated to have paid a further sum of Rs. 6 lacs on different dates to the defendant. According to the plaintiffs, it was agreed by the defendant that he would get the revenue papers in respect of the suit property prepared from the concerned authorities, whereafter, sale deed would be registered in favour of the plaintiffs. The plaintiffs claimed that parties agreed to extend the period of performance of the agreement to sell by one year.
5. It was alleged in the plaint that in the month of February, 2023, when they approached the defendant for execution of the sale deed with the balance payment, the defendants sought further four months’ time to get requisite documents from the revenue authorities. It was alleged that on 10.06.2023, some strangers started interfering in the suit property and it came to knowledge of the plaintiffs that the defendant had entered into another agreement to sell with the said strangers. Ultimately, when the defendant refused to fulfil the obligation under the agreement to sell, the plaintiffs filed the suit before the trial court in which they specifically pleaded that they are ready and willing to pay the balance amount to the defendant.
6. The suit was contested by appellant/defendant by filling his written statement. In his written statements, the defendant while admitting the execution of agreement to sell dated 16.09.2021 has contended that the plaintiffs have failed to pay the balance consideration on or before 16.02.2022 as was agreed by them and as such, they have committed a wilful breach of the conditions of the contract. It was pleaded by the defendant that he had entered into the agreement to sell as he was in urgent need of money to purchase another space to accommodate the needs of his family but the plaintiffs did not pay him the balance amount of sale consideration within the stipulated period of time.
7. It was also pleaded by the defendant that actual physical possession of the suit property is with him and the physical possession of the same was never handed over to the plaintiffs. The defendant has, however, admitted the receipt of the amount as alleged by the plaintiffs in the plaint and it has been stated that the defendant is terminating the agreement to sell because of the fault committed by the plaintiffs. It has been submitted by the defendant that the plaintiffs have not shown their willingness to perform their part of the obligations under the agreement to sell as such, they have failed to make out a case for grant of decree of specific performance. It has been submitted that the agreement to sell dated 16.09.2021 has lost its validity on 16.10.2022 and is not enforceable in law.
8. It appears that initially an ex parte interim order dated 04.07.2023 came to be passed by the learned trial court whereby the parties were directed to maintain status quo with respect to the suit property and the defendant was restrained from dispossessing the plaintiffs from the suit property and creating any third party interest in the suit property. After the pleadings were completed and after hearing the parties, learned trial court passed the impugned order whereby ex parte interim order dated 04.07.2023 has been made absolute.
9. The appellant has challenged the impugned order passed by the learned trial court on the grounds that time was the essence of the contract between the appellant and the respondents and once the respondents failed to make the payment of balance sale consideration to the appellant within the time stipulated under the agreement to sell dated 16.09.2021, the said agreement could not be enforced against the appellant. It has been further contended that the learned trial court has failed to appreciate that actual physical possession of the suit property is with the defendant and still then an order was passed prohibiting the defendant from interfering in the possession of the plaintiffs. It has been also contended that from the pleadings of the plaintiffs it is clear that they were never ready and willing to perform their part of the contract as such, no temporary injunction could have been passed in their favour.
10. I have heard learned counsel for the parties and perused the record of the case as well as the impugned order.
11. Before testing the merits of the contentions raised by the learned counsel for the appellant, it would be apt to notice legal position as regards the principles for grant of temporary injunction.
12. Section 94 of the Code of Civil Procedure (CPC) relates to supplemental proceedings. It inter alia provides that in order to prevent the ends of justice from being defeated, the court may grant temporary injunction or makes such other interlocutory orders as may appear to the court to be just and convenient. Order XXXIX Rule 1 of the CPC enumerates the cases in which interim injunction may be granted. As per this provision, temporary injunction may be granted if property in dispute in a suit is in danger of being wasted, damaged or alienated by any party to the suit or wrongfully sold in execution of a decree. It can also be granted if the defendant threatens or intends to remove or dispose of his property with a view to defrauding his creditors. Temporary injunction can be granted in a case where defendant threatens to dispossess the plaintiff or otherwise cause injury to the plaintiff in relation to any property in dispute in the suit.
13. Thus, the legal position is that for a civil court before which a suit has been filed in respect of the property, it will be open to it to pass appropriate orders for protecting the subject matter of the lis. To that extent there cannot be any dispute about the powers of the civil court to pass orders during the pendency of the suit. A question arises as to what are the principles that would govern a civil court while considering grant of an interim protecting order in the nature of section 94 of the CPC read with Order 39 Rule 1 CPC. The issue has been a subject matter of discussion in a number of cases decided by the Supreme Court and various High Courts of the country. It would be apt to refer to one of such cases decided by the Supreme Court to understand the position of law on the subject. The Supreme Court in the case of Dalpat Kumar vs Parladh Singh, (1992) 1 SCC 719 has laid down the cardinal principles for grant of interim injunction in the following manner:
“5......Satisfaction that there is a prima facie case by itself is not sufficient to grant injunction. The Court further has to satisfy that non-interference by the Court would result in "irreparable injury" to the party seeking relief and that there is no other remedy available to the party except one to grant injunction and he needs protection from the consequences of apprehended injury or dispossession. Irreparable injury, however, does not mean that there must be no physical possibility of repairing the injury, but means only that the injury must be a material one, namely one that cannot be adequately compensated by way of damages. The third condition also is that "the balance of convenience" must be in favour of granting injunction. The Court while granting or refusing to grant injunction should exercise sound judicial discretion to find the amount of substantial mischief or injury which is likely to be caused to the parties, if the injunction is refused and compare it with that it is likely to be caused to the other side if the injunction is granted. If on weighing competing possibilities or probabilities of likelihood of injury and if the Court considers that pending the suit, the subject-matter should be maintained in status quo, an injunction would be issued. Thus the Court has to exercise its sound judicial discretion in granting or refusing the relief of ad-interim injunction pending the suit.”
14. From the above analysis of law on the subject, it is clear that for a plaintiff to make out a case for grant of interim injunction, he has to show that there is a prima facie case in his favour and that withholding the relief of interim injunction would result in irreparable injury to him. The plaintiff has also to show that the balance of convenience lies in his favour and for determining this, the court would have to compare the amount of mischief or injury which is likely to be caused to the parties if the injunction is refused and compare it with that which is likely to be caused to the other side, if the injunction is granted.
15. In light of the aforesaid legal position, let us now analyze the facts of the instant case. It is admitted by the parties that agreement to sell the suit property was executed between them in respect of the suit. The appellant/defendant has admitted the receipt of an amount of Rs. 16 lacs out of a total sale consideration of Rs. 65 lacs. The contention of the appellant is that the plaintiffs did not pay the balance amount of consideration within five months in terms of covenants of the agreement to sell, as such, they have forfeited their right to seek specific performance of the agreement. It has been vehemently contended by the learned counsel for the appellant that the time was essence of the contract inasmuch as it was incumbent upon the plaintiffs to pay the balance amount of consideration within the stipulated time in terms of the contract. In this regard, learned counsel for the appellant has placed heavy reliance upon the judgment of the Supreme Court in case of Saradamani Kandappan vs S. Rajalakshmi and others, (2011) 12 SCC 18 and the judgment to the Bombay High Court in case of Girish Vinodchandra Dhruva and others vs Smt. Neena Paresh Shah and another, First Appeal No. 1252 of 2013, decided on 12.06.2023.
16. If we have a look at the covenants of the agreement to sell executed between the parties, it does provide that plaintiffs shall make the payment of the balance amount to the defendant within five months vide its clause (3). The second part of the same clause provides that the defendant shall be bound to execute the sale deed in favour of the plaintiffs. To appreciate and determine as to whether obligation of plaintiffs to make payment of balance amount of sale consideration within five months was independent of the obligation of the appellant to execute the sale deed by procuring the necessary documents in this regard, we need to read the agreement to sell as a whole in the light of the legal position emanating from the provisions contain in sections 51 to 54 of the Contract Act.
17. Section 51 of the Contract Act provides that when a contract consists of reciprocal promises to be simultaneously performed, no promisor need to perform his promise unless the promisee is ready and willing to perform his reciprocal promise. Section 52 of the Contract Act provides that where the order in which reciprocal promises are to be performed is expressly fixed by the contract, they shall be performed in that order. Section 53 of the Contract Act provides that when a contract contains reciprocal promises, and one party to the contract prevents the other from performing his promise, the contract becomes voidable at the option of the parties so prevented. Section 54 of the Contract Act provides that when a contract consists of reciprocal promises, such that one of them cannot be performed, or that its performance cannot be claimed till the other has been performed, and the promisor of the promise, last mentioned fail to perform it, such promisor cannot claim the performance of the reciprocal promise.
18. In light of the aforesaid provisions of the Contract Act, let us now examine the covenants of the agreement to sell. As already stated, clause (3) of the agreement to sell provides for payment of balance sale consideration within five months and at the same time, it provides that defendant shall be bound to execute sale deed in favour of the plaintiffs. Clause (2) of the agreement provides that after receiving the earnest money, the defendant shall initiate the process of procuring the revenue extracts for registration of sale deed.
19. Prima facie, it appears that the order of performance of obligations by the parties laid down in the agreement to sell. As per this order, as a first step, the plaintiffs have to pay the earnest money which they have paid in terms of clause (1) of the agreement. In terms of clause (2), upon receipt of the earnest money, the defendant has to procure the revenue documents for registration of sale deed. There is nothing in the written statement or in the appeal to suggest that the appellant has procured the revenue documents for preparation of the sale deed or that he has at any point of time shown these documents to the plaintiffs. It was only after obtaining these revenue documents by the defendant that the plaintiffs were obliged to pay the balance amount of sale consideration within five months to the defendant, whereafter the sale deed was to be executed.
20. It appears that as per the order of performance of obligations as indicated in the agreement to sell dated 16.09.2021, the obtaining of revenue documents for registration of sale deed by the appellant is a step anterior to the obligation of plaintiffs to pay the balance amount of sale consideration. Therefore, the contention of the learned counsel for the appellant that plaintiffs failed to perform their part of the obligation under agreement to sell and as such, they forfeited their right to seek specific performance of the said agreement, appears to be without any merit as the payment of balance amount of sale consideration was dependent upon the procurement of revenue documents by the defendant, which he has not done. The appellant has not even terminated the agreement to sell until filing of the suit, which shows that the appellant knew that obligation of the plaintiffs to pay the balance amount of sale consideration would arise only when the appellant obtains the revenue documents in respect of the said land.
21. It has been vehemently contended by the learned counsel for the appellant that the time was the essence of the contract in this particular case inasmuch as appellant wanted to purchase property for his family to accommodate their needs but because plaintiffs did not make the payment of the balance sale consideration within time as such, he could not purchase the same. It is a settled principle of law that in the case of sale of immovable property, time is never regarded as essence of the contract. There is a presumption against time being essence of the contract which however, can be rebutted. The question whether the time was essence of the contract in the instant case can be determined only after the trial of the case and at this stage presumption operates against it.
22. The judgments relied upon by the learned counsel for the appellant in support of his contention that the time is essence of contract of sale of immovable property, are the cases where trial had already taken place and the court had the benefit of examining the material collected during the trial of the case. In the instant case, the trial is yet to begin and we have before the court only the pleadings and documents of the parties, therefore, the ratio laid down in the cases cited by the learned counsel for the appellant may not be of any help to the facts and circumstances of the instant case.
23. It has also been contended by the appellant that possession of the suit property is still with the appellant and as such, no injunction could not have been passed against him.
24. If we have a look at clause (4) of the agreement to sell, it clearly stipulates that possession of the property in question has been delivered on spot to the plaintiffs. In the face of this written covenant, which is part of the agreement, the execution whereof has been admitted by the appellant, prima facie it appears that the plaintiffs are in possession of the suit property. The contention of the learned counsel for the appellant is therefore, without any merit.
25. Lastly, it has been argued by the learned counsel for the appellant that the plaintiffs/respondents were never ready and willing to perform their part of the contract inasmuch as they have not placed on record anything to suggest the same.
26. In this regard, it is to be noted that the plaintiffs have specifically pleaded in the plaint that they are ready and willing to perform their part of the contract by making the payment of sale consideration. In fact during the course of the arguments, learned counsel for the respondents has submitted that during the pendency of the suit before the trial court, the plaintiffs had offered more than the amount fixed as sale consideration to the defendant but they declined the said offer. Be that as it may, the fact of the matter remains that whether plaintiffs were ready and willing to perform their part of the contract, can be determined only after trial of the case and not at this stage.
27. In view of the above, it is clear that at this stage, plaintiffs have made out a prima facie case in their favour and in case an interim injunctive order is not passed in their favour and if the defendant succeeds in creating third party interest in the suit property or if he succeeds in dispossessing the plaintiffs from the suit property, they would get non-suited and it will lead to multiplicity of the proceedings. On the other, if ultimately plaintiffs fail in the suit, the defendant would get his property back with an appreciated value, so no injury will be caused to the interests of the defendant.
28. For the foregoing reasons, I do not find any ground to interfere with the well reasoned and lucid judgment passed by the learned trial court. The appeal lacks merit and is dismissed, accordingly.
