JUDGMENT
S.K. Mahajan, J.
(1) By this order I propose to dispose of the application filed by one Mr.Basant Kamal Meattle for vacation of the order dated 25th September, 1995 and for permission to the applicant to complete the building stated to be in the final stages on the plot of land bearing No.465, Sector 15-A, Noida, Uttar Pradesh as also the application of the plaintiff under Order 39 Rules 1 and 2 CPC.
(2) The facts in short which have resulted in the filing of the application are that the defendants are stated to have entered into an agreement to sell the aforesaid plot of land to the plaintiff and a formal agreement was executed between the parties on or around 14th October, 1986 which is stated to have been back dated to 7th October, 1986. A total sum of Rs.2,00,000.00 had been paid by the plaintiff to the defendants, out of a total sale consideration of Rs.7.50,000.00 . It is alleged in the plaint that in spite of repeated demands of the plaintiff, the defendants were not fulfillling their obligation under the agreement and the plaintiff was compelled to file the suit for specific performance of the aforesaid agreement to sell. From the record I find that though service report of service of the summons upon the defendants was awaited, however, Mr.Jagdish Vats, Advocate entered appearance on behalf of the defendants on 13th October, 1988. Time was given to the defendants to file written statement and reply to the application and meanwhile defendants were restrained from transferring or alienating the suit property. Written statement was subsequently filed by the defendants. However, neither the Vakalatnama nor the written statement has been signed by defendant No.2, though Mr.Jagdish Vats had been continuing to appear on behalf of the defendants and up to the date of hearing arguments on 17th October, 1995, it was not brought to the notice of the Court that there is no service report of service upon defendant No.2 nor there is any proper appearance on behalf of the said defendant. Suit was being adjourned from time to time and till date even the application for stay filed in 1988 has not been decided.
(3) The plaintiff on 22nd September, 1995 filed three applications. One application was under Order 39 Rules 1 and 2 for an injunction alleging, inter alia, that during the pendency of the suit, the defendants, in spite of an order of injunction passed by the Court on 13th October, 1988, have transferred the property to Mr.B.K. Meattle vide a registered transfer deed dated 20th December, 1994 and the said Mr.Meattle was carrying on the construction of a house on the said property and it was, therefore, prayed that the said Mr.Meattle be restrained from raising any construction of any nature whatsoever in the suit property and from transferring, alienating or creating any third party interest therein. By the other application under Order 1 Rule 10 the plaintiff wanted the said Mr.Meattle to be imploded as a party to the suit. Still another application was filed under Order 39 Rule 2 A alleging, inter alia, that the order dated 13th October, 1988 had been violated by the defendants by transferring the property to Mr.Meattle and the defendants should, therefore, be proceeded with for their having committed a contempt of Court. By an ex parte order dated 25th September, 1995 Mr.B.K.Meattle was restrained from transferring or in any other manner alienating the suit property and from making any additions/alterations or raising any further construction therein. It was on receipt of notice of this application that the applicant filed the present application under Order 39 Rule 4 Civil Procedure Code for vacating the said order dated 25th September, 1995.
(4) The case as set up by the applicant is that the suit is collusive between the plaintiff and the defendants and the applicant was a bonafide purchaser for value without notice of the agreement stated to have been entered into between the plaintiff and the defendants and as such the order of injunction was liable to be vacated. It has further been stated in the application that the suit was for specific performance of a contract of sale of a property situated in Noida in the district Ghaziabad, State of Uttar Pradesh and the same being outside the territorial jurisdiction of this Court, this Court did not have jurisdiction to pass any order in the suit and the ex parte order of injunction passed on 25th September, 1995 against the applicant was liable to be vacated. Reply to the application has been filed by the plaintiff. No one has appeared on behalf of the defendants in this case.
(5) Arguments of Mr.Daljeet Singh, Sr.Advocate appearing on behalf of the applicant is that firstly, this Court has no jurisdiction to try the suit as the property is situated outside the jurisdiction of this Court and secondly, the applicant being a bonafide purchaser for consideration without notice of the agreement alleged to have been arrived at between the plaintiff and the defendants, is not bound by the said agreement. The contention is that before purchasing the property, the applicant had taken all steps to ensure that there was no lien or litigation in respect of the property. The applicant is stated to have made enquiries from Sub-Registrar as well as from the Noida Authority to satisfy himself that the property was not subject to any earlier agreement or litigation nor was any lien thereupon. It was on such enquiries that the applicant came to know that the property had earlier been mortgaged with permission of the Noida Authorities with the Bank. The applicant then entered into an agreement with the defendants on 8th May, 1994 for purchase of the property for Rs.36,45,000.00 . Out of this amount a sum of Rs.15,21,067.18 paise is stated to have been paid to the bank in satisfaction of the decree which was passed in favor of the Bank against the defendants for recovery of the amount paid by the bank for which the mortgage was created by the defendants. Permission was also obtained from the Income Tax Department as well as from the Noida Authorities for sale of this property to the applicant and it was after such permissions that the sale deed was executed by the defendants in favor of the applicant on 20th December, 1994. It is stated that the Noida Authorities had extended the time for construction up to 29th November, 1995 and the applicant having already spent a sum of more than Rs.15,00,000.00 on the construction, the balance of convenience clearly lies in his favor in case construction is allowed to be carried on subject to final decision of the suit.
(6) Lengthy arguments have been advanced by the parties on the point of jurisdiction. At this stage when the applicant is not even a party to the suit, I am not inclined to decide this question of jurisdiction and am confining this order only to the disposal of the application of the plaintiff under Order 39 Rules 1 & 2 and the application of the applicant under Order 39 Rule 4 CPC.
(7) The main contention of Mr.Rohtagi, Senior Advocate appearing for the plaintiff, is that admittedly the defendants have transferred this property to the applicant in violation of the Order dated 13th October, 1988, whereby the defendants were restrained from transferring or alienating the property in suit. The submission, therefore, is that till such time the defendants purge themselves of the contempt, they do not have any right to be heard and the applicant having stepped into the shoes of the defendants cannot have a better right to be heard than that of the defendants. It is also his submission that it is a fit case where the Court should direct the status quo ante to be restored by directing the demolition of the structure which has been raised on the plot of land after the grant of the Order of injunction on 13th October, 1988.
(8) MR.DALJEET Singh, however, on the other hand, has contended that he being a bonafide purchaser for value without notice is not bound by any contract which might have been arrived at between the plaintiff and the defendants. It is his contention that under Section 19(b), neither the alleged contract nor the present suit will be binding upon him as he was claiming a title under a subsequent contract for value without notice of the original contract. He submits that he has already spent a sum of more than Rs.36 lakhs in the purchase of the land and a sum of more than Rs.15 lakhs have been further spent by him in the construction of a double storeyed house, plans of which were sanctioned by the concerned authorities. He submits that in case the construction is not allowed to be carried out, there is an apprehension of not only the lease being cancelled by the Noida authorities but also a penalty of more than Rs.3 lakhs being imposed by such authority for not constructing a building by 29th November, 1995.
(9) The question as to whether the defendant is a transferee for valuable consideration without notice of the agreement to sell is a question which has to be decided on merits and cannot be decided on the contentions of the parties, as made out in the pleadings. Whether the applicant can be allowed to take benefit of the wrong committed by the defendant by transferring the property to him in spite of the order of stay against the defendant is the only question which requires consideration in the present case. It is no doubt true that it has been repeatedly held by this Court as well as by the Supreme Court that till such time the defendants purged themselves of contempt, they have no right to be heard. However, in the present case, it is not that the defendants want themselves to be heard, but it is the applicant who has made this application for vacating the stay passed on 25th September, 1995.
(10) I have given my thoughtful consideration to the matter in controversy between the parties and to the question as to whether the order dated 25th September, 1995 is liable to be vacated and as to whether permission can be given to the applicant to complete the construction. In Jiwan Dass Rawal Vs. Narain Dass and Others, Air 1981 Delhi 291, it was held as under : – “A contract for sale is a right created in personam and not in estate. No privity in estate can be deduced there from which can bind the estate, as is the position in cases of mortgage, charge or lease. Of course, such personal right created against the vendor to obtain specific performance can ultimately bind any subsequent transferee who obtains transfer of the property with notice of the agreement of sale. Till, therefore, a decree for specific performance is obtained, the vendor or a purchaser from him is entitled to full enjoyment of the property. In fact, even if a decree for specific performance of contract is obtained, and no sale-deed is actually executed, it cannot be said that any interest in the property has passed. consequently, temporary injunction cannot be issued at the instance of person in whose favor agreement to sell was executed till decree of specific performance is obtained by him and a sale-deed is executed in his favor, to prevent the transferee under the sale deed from enjoying the possession of the plot under transfer and get the sale mutated in his favor.”
(11) For the grant of a temporary injunction, the plaintiff has to prove that besides prima facie case the balance of convenience also lies in his favor and in case the injunction is not granted, he will be suffering an irreparable loss and injury. Balance of convenience means that comparative mischief or inconvenience which is likely to issue from withholding the injunction will be greater than that which is likely to arise from granting it. In applying this principle, the Court has to weigh the amount of substantial mischief that is likely to be done to the applicant 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.
(12) Applying these principles to the case in hand, I find that the applicant has already spent a sum of more than Rs.36 lakhs in the purchase of the plot of land and has also spent a substantial amount, Rs.15 lakhs as per the contention of the applicant, on the construction of building thereon in accordance with the plans sanctioned by the concerned authorities. The construction has to be carried out within a specified time and in case there is a delay, the authorities can take an action either by cancelling the lease or by levying a penalty. Now, in case the construction is stayed, what is the benefit which the plaintiff will derive and what is the loss which will be caused to the applicant? In case the building is blocked in its present stage of construction, no benefit will come to the applicant but I do not see how the same will benefit the plaintiff. If the construction is left in the present stage, the rains will come and will damage the building. So, something has to be done to make the construction safe. Some provision, therefore, should be made which would safeguard the interest of both the sides without causing much harm to other side. However, in case the construction is allowed to be made, it must be ensured that in case the plaintiff succeeds in this suit, he is given the property in the vacant state.
(13) I am, therefore, of the opinion that ends of justice will be met by passing the following order:- 1.THEapplicant is allowed to complete the construction of the property in accordance of the plans sanctioned by the authorities. 2.The applicant is restrained from transferring, alienating, assigning or creating third party interest in the property so constructed. 3.The applicant gives an undertaking within one week of the passing of this order that the building will be constructed at his risk and cost and he will within six months of a decree being passed in favor of the plaintiff remove the construction without any reservation or claim for damages. He will also not induct any tenant in the building after construction because induction of such tenant may cause difficulty in the demolition of building, if necessary.
(14) In my opinion, in this way, the equity will be balanced between the parties.
(15) The above applications are, accordingly, disposed of in terms of the above order.