1 Civil Appeal no. 923/00
Presented on :07.09.1988 Registered on :07.09.1988 Decided on :08.01.2007 Duration :18 Ys.04Ms.01Ds.
BEFORE THE DISTRICT COURT PUNE AT : PUNE. [Present : S. G. Deshpande,]
[Ad-hoc District Judge -12, Pune ]
CIVIL APEPAL No.923/2000 EXH.NO. (Old Civil Appeal No.485/89)
1] Mr. A. S. J. D'silva, DECEASED through legal heirs1a] Mrs. Luella Dias Age : 42 years. Occ : housewife, R/at : Memas P.O.Box 1102, Maham Baharain
1b]Mrs. Iola Sequeria Age : 39 years, Occ : Housewife R/at : JN4/Bldg.8, Ganga, Flat No.5, 1st floor, Sector 9, Vashi, New Mumbai.
1C]Mrs. Viola Mederia Age : 35 years, Occ : Housewife R/at : 34, Voltri Street, Mentos, Victoria, 3194, Australia.
2] Mrs. Grace D'silva, Age : 40 years, Occ : household work Both residing at L-63, Reserve Bank Quarters, Maratha Mandir Marg, Bombay. ..... Appellants
-V E R S U S -
1] Paramount Apartments, Co-operative Housing Society Ltd., 1981, Convent Street, Pune (registered under Maharashtra
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Co-operative Societies Act, 1960)
2]The Managing Committee, Paramount Apartments Co-operative Housing Society Ltd.,1981, Convent Street, Pune
3]Poonawalla Promoters Pvt. Ltd., a Private Limited Company incorporated under the Companies Act, 1956, having registered office at No. 2409, East Street, Pune
4]Mr. Rusi S. Poonawalla, Adult, Occ : Busienss, R/at 1-B, Dr.Voyaji Marg, Elphinstone Road,pune
5]Mr. Rajgandhi K. Sayani, Adult, C/o Oriental Scientific Instrument Corporation 277, Narayan Peth, Pune
6]G. M. Shaikh, Adult, Major Retired Teacher R/at A/5, Third Floor, Paramount Apartment, Convent Streeth, Pune – deceased his legal heirs are
7] Mrs. Sugrabi Gulam Shaikh, Age : 63 years, Occ : Housewife R/at : Flat No. A-5, 3 rd floor, Paramount Apartments, Co-operative Housing Soceity Limited, Convent Street, Pune
8]Mrs. Nadira wife of Ross Masud Gulam Shaikh, R/at : Flat No. A-5, 3rd floor, Paramount Aprtments, Covent Street, Pune. ..... Respondents Adv. Shri. Khandgoankar for applicants. Adv. Shri. Kanitkar and Shri Swaminathan for respondents
3 Civil Appeal no. 923/00
J U D G M E N T [Delivered on this 8 th day of January , 2007 ]
The appellants filed Spl. CS no. 136/80 for declaration and
possession of suit flat, in the alternative, for refund of the amount of Rs.
38,245/- with interest and a direction to the defendants 1 & 2 to provide
another flat with identical area and amenities to them. The facts in brief are
as follows.
2] The respondent no.1 is a registered co-operative housing society,
the defendant no.2 its managing committee . The defendant no.4 was
managing director of the defendant no.3, a private limited company and
together they were promoters and builders of a housing complex,
“Paramount Apartments”. The defendant no. 5 was secretary of the society
and defendants 7 and 8 , heirs of the deceased G. M Shaikh were stated to
have taken forcible possession of the suit flat.
3] The defendant no.4 issued advertisement for sale of residential
apartment in a building called as “Paramount Apartments” to be constructed
on 1981, Convent Street, Cantonment, Pune. Pursuant to that, the appellant
no.2 approached and advanced him a total sum of Rs. 38,245/- for one flat .
An agreement was entered into on 3/12/1973 and flat no. A-5 (herein called
as suit flat) on the third floor was allotted to the appellant. Possession was
delivered to the appellants. The deceased appellant no.1 had executed a
power of attorney in favour of appellant no.2. On her behalf, her brother
Francis Pinto looked after the suit flat and was in possession thereof from
18/3/1978 openly.
4] The defendants no.3 and 4 committed irregularities in
management of the society. The secretary of the society, respondent no.5
forcibly dispossessed the appellants from the suit flat. Their belongings were
thrown away and Francis Pinto was removed . They manipulated records
and unlawfully allotted the suit flat to the former Joint Secretary of the
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society, the defendant no.6 (deceased G.M. Shaikh) delivering it in his
possession. The defendants 7 to 8 his LRs were in unlawful possession of
the suit flat.
5] The appellants claimed a declaration confirming allotment of
the suit flat to them. A further declaration that the respondent no. 3 had
unlawfully withheld notifying allotment of the flat, another declaration that
the appellants were valid members of the society and that allotment of the
suit flat to the respondent no.6 was illegal. The appellants also claimed
actual possession of the suit flat and in the alternative, allotment of another
flat with identical area or refund of the sum of Rs. 38,245/- with interest at
18% along with mesne profits at the rate of Rs. 500/- per month from
18/9/1979 the date of dispossession. .
6] The respondent nos. 1, 2 and 5 in their written statement (Exh.
36) admitted constitution of the society and that respondents 3 & 4 were
builders and promoters of Paramount Apartments. The execution of the
agreement is denied for want of knowledge and therefore admitted. It is
admitted that the respondent no.5 was a secretary of the society. It is
admitted that the suit flat was allotted to the respondent no.6 and that he
was in possession of the same. It is admitted that the appellant no.1 had
sought admission to the membership of the society but that was rejected. It
is denied that the suit flat was alloted to the appellants and they were placed
in possession thereof. It is denied that Francis Pinto was forcibly evicted. It
is denied that the society record was manipulated.
7] It is submitted that though the agreement was held as executed,
it was forfeited by default . The appellants did not make payments of
installments after 3/7/75. It was learnt that they had withdrawn Rs. 10,000/-
from the payment made by them and canceled the allotment. There was no
existing agreement. They were estopped from claiming the suit flat. The suit
was barred by limitation not maintainable and the Court had no jurisdiction.
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8] The respondents 3 & 4 admitted that they were builders and
promoters and Paramount Apartments. It is admitted that the appellants
had approached them. Execution of the agreement is not disputed. It is
however denied that the appellants were placed in possession of the suit flat.
It is denied that Francis Pinto was dispossessed . It is denied that there was
mis-management of the society. It is submitted that the agreement was
forfeited by default of the appellants . They had not paid installment after
3/7/75. On the other hand they had withdrawn Rs. 10,000/- from out of the
deposits and given up their rights in the suit flat. The suit was sought to be
dismissed with cost.
9] The respondent no.7 and 8 in their written statement admitted
that the suit flat was alloted to her husband G. M. Sheikh. It is admitted
that it was in her possession. It is denied that the appellants had paid the
sum of Rs. 38,245/-. it is denied that agreement was executed. It is denied
that they were ready to fulfill the agreement. It is denied that the suit flat
was given to them and they were in possession at any time. It is submitted
that the alleged agreement dated 3/12/73 was anti-dated . It was invalid and
not enforceable. It was not stamped or registered. It is submitted that the
suit was grossly under valued. It was sought to be dismissed. It is submitted
that the defendant no.6 was a school teacher. From his savings, he had
agreed to purchase the suit flat and in part performance of the same, he was
inducted in possession. After his death, on 14/3/83, the respondent no. 7 and
other heirs were residing in the suit flat. It is submitted that the court had
no jurisdiction to try the suit and it was bad for non-joinder of necessary
parties.
10] The trial Court framed as many as 23 issues. The appellants
examined Mrs. D'silva and P. W. 2 Francis Pinto. The respondents 1 & 2
examined Anthony Britto, Chairman of the respondent no. 1 society from
1983. Respondent nos. 7 & 8 examined Ross Sheikh, son of the deceased
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defendant no.6. The trial Court held that the appellants had failed to prove
that the suit flat was alloted to them or that they were placed in its
possession. It was further held that the suit was barred by limitation and the
Court had no jurisdiction to try it. It was further held that the agreement in
favour of the plaintiffs was terminated and they had no right thereunder.
The suit came to be decreed partly on 8/12/87 for refund of earnest money
and the respondents 3 & 4 were directed to pay Rs. 29,015/- along with
interest at the rate of 9% per annum to the appellants.
11] Being aggrieved by the judgment , the appellants preferred this
appeal. It was initially presented before the Honorable High Court Bombay
and registered as Appeal No. 485/89. By virtue of change in the jurisdiction
the appeal was returned to the District Court.
12] The learned advocate for the appellants and respondents 3 & 4
submitted written notes of arguments. No one else appeared, in spite of
repeated calls made. It was necessary for this Court to decide the appeal at
the earliest in view of the directions of the Honorable High Court for
expeditious disposal . Finding that the other parties were not taking active
part in hearing of the appeal it was required to be posted for judgment.
Because of some administrative assignments entrusted, delivery of the
judgment is slightly delayed.
13] I have gone through the written notes of the argument and the
record and proceedings of the trial Court. Following points fell for
determination. The findings thereon and reasons therefor are given
hereinafter.
POINTS FINDINGS
1]Whether the trial Court was justified in holding lack of jurisdiction of the Civil Court? : No
2]Whether the trial Court was justified in holding that the suit was barred by limitation? : No
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3]Whether the trial Court erred in holding that the agreement Exh. 96 was not binding on the defendant? : Yes 4]Whether the trial Court was justified in rejecting that the plaintiffs were dispossessed from the suit flat? : No
5] Are the appellants entitled to the relief?
: Yes.
6] What order ? : Appeal allowed partly.
14] Before proceeding to reasons, certain things need mention at the
outset. Though disputing parties, the defendants were clearly identified, the
trial Court gave them liberty to cross examine without any sequence. After
the PW 1 Mrs. D'silva was cross examined, an application was moved at
Exh.128 on her behalf for leave to additional evidence in view of certain
documents. The application was allowed. Additional examination – in – chief
was recorded and she was again cross examined. However, the Trial Court
did not control the cross examination to the newly stated facts and if
wondered even beyond the additional chief examination.
15] It is a usual practice that a defendant who is not at issue with
another defendant is asked first to cross examine witness of such other
defendant. It is only thereafter that the plaintiff is called upon to cross
examine. It is not the other way around. The main object is that such a
'friendly' defendant should not get a chance to undo the effect of cross
examination of the witness by the plaintiff. However, the Trial Court seems
to have sacrificed this golden rule. For instance, the counsel appearing for
the defendant no.6 initially declined to cross examine the DW Anthony
Britto. However, after the plaintiff's cross examination, again the defendant
no.6 was permitted to cross examine the same witness of length. In that
cross examination, the witness seems to have assented to the question put to
him. Similar instance was repeated when evidence of the DW Ross Sheikh
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was recorded. The defendant nos.1 & 2 were permitted to cross examine him
after the cross examination by the plaintiff. This approach ought to have
been avoided. It appears that the Trial Court was casual in that. This
requires the Court to approach evidence of these witnesses with additional
caution.
16] Another thing worth mentioning in the beginning is that a clear
picture having distinct bearing to the dispute has emerged from the
evidence. The testimony of the witnesses yielded that picture and therefore
it is far more important. It seems that sometime in 1978 – 79, disputes about
management of the housing scheme arose. It is alleged and also held by the
trial Court that the defendant no.4 had sold same flat to several persons.
Accusations were hurled at him and the secretary, defendant no.5 as well.
Police had also initiated action against the defendant no.4 and he had gone
underground. It is further brought on record that purchasers of the flat,
having grown scary and panicked had taken possession of flats still very
much under construction. Many of such flats were not having even basic
amenities like doors, window pains, toilets, plastering of walls and so on.
Even then the purchasers, out of fear of loosing everything had rushed, fitted
their own doors and locked them in an attempt of securing and ensuring
their respective possession. It was only subsequently, after 1981 – 82 that
the purchasers had gathered, formed a group, taken additional contribution
@ Rs. 30 – 40/- per sft from the purchasers and completed construction and
provided amenities. Formation of co-operative housing society was thus a
subsequent development. It is in this backdrop that the evidence deserves
appreciation.
REASONS
AS TO THE POINT NO.1 : (jurisdiction of Court)
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17] The learned trial Court held that the Court had no jurisdiction to
try the suit. That goes to the root of the case and deserves initial attention.
18] There can not be two opinions about the fact that civil Court has
no jurisdiction to declare a party a valid member of co-operative society.
That is the exclusive jurisdiction of Co-operative Courts. The plaintiffs'
counsel had conceded this aspect before the Trial Court and he accepted it in
para no. 30 of the judgment.
19] The Trial Court further observed that the Civil Court had no
jurisdiction to grant a declaration confirming allotment of the suit flat. The
reasons given in support of that are not sustainable. Presuming that the
plaintiffs did not pay the purchase money, or that they were defaulters, or
that the defendant no.4 had informed that the allotment of the flat was
canceled, it does not mean that the Civil Court was not capable of declaring
whether the suit flat was allotted to him. It is a settled law that the
pleadings define jurisdiction. As per the plaintiffs, they had booked the suit
flat in 1973 with the defendants 3 and 4. There was no co-operative society
at that time. The allotment of the suit flat was confirmed by the defendants 3
and 4 and latter all the defendants had challenged their legal right as to the
suit flat. In such circumstances, the plaintiffs could rush only to the Civil
Court and seek a declaration. The reasons and conclusion of the Trial Court
in this respect need to be and is rejected. It is held that the Civil Court had
the jurisdiction to decide the suit barring of course the plaintiff's entitlement
to be accepted as a member of the respondent no.1 Co-Op. Society. The
point is therefore answered in affirmative.
AS TO THE POINT NO.2 : (question of limitation)
20] The trial Court proceeded on a wrong assumption that the suit
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ought to be for specific performance of contract. The reasons given for
holding that the suit was barred by limitation are absurd. It may have been
agreed in Exh.96 that possession was to be given in 1975. The fact remains
that the construction work was not completed till 1979-80. Besides, by their
acts, the defendants had denied the legal character of the plaintiffs as
regards the suit flat in 1979-80. The suit filed in 1980 is therefore absolutely
within time. The finding of the trial Court cannot be sustained. The point
under consideration is therefore answered accordingly.
AS TO POINT NO.3 : (binding nature of agreement)
21] The plaintiffs proved at Exh.96 the agreement dated 3/12/1973. It
was introduced in evidence without any objection (though subsequently
question of it's validity for want of registration was raised. That is addressed
separately). That was executed by the defendant no.4 as a proprietor of the
defendant no.3. Together, they were promoter and builder of the building.
22] Exh.96 states (para 9) that the plaintiff had booked a two
bedroom flat no. A -5 on the third floor with an area of 790 sft. The
consideration of Rs. 47,000/- (page 5) was to be paid in installments
depending on the stage of construction. The last but one installment of Rs.
4000/- was to be paid within 10 days of completion of work of tiling and
internal plastering. The last of the ten installments was to be paid at the
time of delivery of possession of the flat. Clause (vi) provided that if within
one month of demand payment due, was not made, the defendant no.3 and
4 were entitled to terminate the agreement and forfeit the earlier payments
made. Para (ix) provided that a notice was to be given by the promoter to the
purchaser that the flat was ready for use and occupation and thereafter the
purchaser was to bear taxes and charges for electricity and so on.
23] Absence of registration of the agreement Exh.96, in this
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particular case would not come in the way of asserting effect of the terms
thereof. The first reason is that parties are not at issue about that. That is
held by the Trial Court in para 16 of the judgment. The trial Court also
discussed contents of the agreement (Exh.96) at various places in the
judgment. The agreement was referred to the witnesses during cross
examination. Moreover issue no.3 pertaining to the binding nature of the
agreement is answered against the plaintiff but not for want of registration.
The trial Court came to that conclusion because of some admissions of the
plaintiff which went contradictory to the terms of the agreement Exh.96.
There is no cross objection on all these. There is therefore no hindrance nay,
it is all the more essential to consider the agreement though not registered.
24] It would be beneficial here to consider the receipts Exh.97 to
Exh.105. They span from 8/6/1972 to 3/7/1975. They prove that the
plaintiffs had paid installments to the defendant nos. 3 & 4 for the suit flat
no. A – 5 on third floor. The installments were in consonance with the
repayment Schedule stated in para 9(i) of the agreement. In fact, amount in
excess was paid by the plaintiffs till 3/7/75. The last few installments were
for Rs. 4775/- when the scheduled installments were for Rs. 4000/-.
Secondly, the installment paid under Exh.105 was for the stage of laying
fifth slab. As per the schedule, the plaintiff was required to pay only Rs.
32,000/- till that stage. But the plaintiffs had paid Rs. 38,245/- till then. A
small amount of Rs. 8755/- out of the consideration of Rs. 47,000/- remained
to be paid.
25] As per the schedule of payment in the agreement, the next two
installments were payable within 10 days of demand after laying sixth and
seventh slab. The last two installments were payable after completion of
plastering and at the time of taking possession respectively.
26] As stated earlier, the agreement provided specific conditions in
which it could be terminated. The promoter could not terminate the
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agreement nor forfeit the money received (as per Cl. iv) unless the purchaser
had failed to pay money within a month of the same being demanded.
27] The defendant no.4 did not step in the witness box and led no
evidence that such a thing which entitled him to terminate the agreement
had occurred. The PW 1 Mrs. D'silva admitted that money was demanded
through the notice of Adv. Oswal (notice dated 21/3/79). She explained that
payment could not be made because there was news reporting (Exh.107)
about credibility of the defendant nos. 3 & 4.
28] The back drop of the chain of events is discussed earlier. The
promoter was reported to have sold flat to more persons than one and the
police were after him. Moreover those who had paid to the defendant no.3 &
4 were rushing and occupying flats at whatever state they were in. In these
circumstances, it was absolutely normal for the plaintiffs not to make further
payment of a small sum outstanding. It is stated that they had paid over Rs.
38,000/- out of the consideration of Rs. 47,000/-. Whatever remained due was
not a big amount. A bank pass book is filed by the plaintiffs to show that
they had enough money. That can not be of much use in absence of evidence
of the banker maintaining that. Even then, the non payment of the balance
amount by the plaintiffs was not a matter of great concern. In the
circumstances of the case, the defendants 3 and 4 could not invoke the clause
of forfeiture against the plaintiffs.
29] The learned trial Court heavily relied upon the plaintiffs
admission that she had taken Rs. 10,000/- from the defendant no.4 for the
treatment of her ailing husband and had not returned it. He overlooked her
explanation that it was a different transaction. It cannot be understood as to
why the two transactions cannot be regarded separate and distinct. The
defendant no.3 is a Private Limited Company. The agreement Exh.96 did not
provide that the purchaser could withdraw from the purchase money;
definitely no partial withdrawal was permitted. The agreement stipulated
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only one contingency in which the purchase money could be refunded. That
was in the event of the contract getting frustrated. For any other breach, the
money paid was liable to be forfeited. Therefore, under the agreement,
nothing entitled the plaintiff to withdraw partly from the defendants 3 and 4
nor was there any obligation upon them to allow that. The defendant nos. 3
& 4 did not adduce any evidence in support of their contentions.
30] The probabilities incline against holding that the plaintiffs had
withdrawn Rs. 10,000/- from the purchase money. The defendant no. 3 as a
private company was not constituted for that. In spite of that, if Rs. 10,000/-
was paid out of the purchase money, that could have reflected some where in
the accounts of the company. But as stated, no evidence was led and the trial
Court came to a wrong conclusion totally discarding the explanation offered
about taking a hand loan from the defendant no.4. That was a different
transaction and should have been held as such. Considering the relations it
is probable that the defendant no.4 may have lent Rs. 10,000/- to help the
plaintiff in attending her husband. That was a different transaction and the
payment of Rs. 38,245/- was not affected by that .
31] Admittedly, the plaintiffs did not return Rs. 10,000/- to the
defendant no.4. However, for the above reasons, that fact shall not come in
the binding nature of the agreement at Exh.96. The learned trial Court gave
undue importance to some part of oral evidence of the plaintiff. In fact, he
was so moved by that, that he felt it unnecessary to consider the
documentary evidence (para 19 of the judgment). He held that the agreement
is not binding because, the entire consideration was not paid. That was an
undisputed fact but as a Court, the attending circumstances, the facts and
the entire evidence should have been considered. By not following these basic
requirements, the trial Court demonstrated undue haste in arriving at his
conclusions.
32] The agreement (Exh.96) was executed on 3/12/73. The plaintiffs
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paid more than 3/4th of the consideration. There is nothing on record to show
that the deceased G. M. Sheikh or the present occupant of the flat had
entered into agreement prior to that. In the evidence not supported by
pleadings his son, DW Ross testified that the agreement was entered into on
or about 1/6/77. That agreement is no where placed on record though the
trial Court, vide order below Exh.126 had directed the defendants 7 and 8 to
produce it. Presuming that any such agreement was entered into, that was
about four years after Exh.96.
33] Now to the question as to whether the agreement was
terminated. On this crucial aspect also, the trial Court has not considered
the evidence in its proper perspective. In fact, it did not consider the evidence
led and not led by the defendants.
34] As stated above, the agreement clearly stipulated that on failure
to pay the installment within one month of the demand made after the stage
of construction was over, that the agreement could be terminated. The
plaintiffs had made payment of surplus amount at the 6th stage of
construction. The last installment was paid on 3/7/75 vide the receipt at
Exh.105. It says that the 5th slab was laid and the installment paid there
under was sixth installment.
35] The plaintiffs did not pay further installments after 3/7/75. It
would be interesting in this respect to note how they and the defendant nos 3
& 4 were reacting to the situation thereafter.
36] As stated above, the agreement stipulated payment of Rs.
32,000/- till the sixth installment but the plaintiffs had paid Rs. 38,245/- till
then. On 26/5/1977, the defendant nos. 3 & 4 issued Exh.106 to the PW 2
Francis Pinto. That is styled as a “pass” and permitted Pinto to see the suit
flat. In his letter Exh.117 dated 4/8/1977, Pinto assured the defendant no.3
payment of the remaining amount. The last but one para of that letter is
important. It shows how Pinto wanted the defendant nos. 3 & 4 to effect
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some changes in the construction of the toilet. Not just that, in his letter
dated 13/1/1978 (Exh.108) the defendant nos. 3 & 4 had issued a blanket
certificate that the plaintiff no.1 was allotted the suit flat.
37] The evidence thus shows that in spite of non payment of further
installment, the defendants 3 & 4 till January 1978 had not canceled the
agreement.
38] The PW 1 Mrs. D'silva admitted to have received notices from
Adv. Oswal on behalf of the defendants 3 & 4 demanding balance payments.
According to her, that notice was dated 21/3/1979. the defendant did not care
to prove that notice and therefore its contents beyond what is admitted by
the plaintiff cannot be presumed.
39] The question is whether failure of the plaintiffs to abide on the
notice of Adv. Oswal would entail termination of the agreement? Mere non
payment could not result in that. For payment of installment, the condition
precedent was completion of a particular stage of construction. Without that,
the defendants 3 & 4 could not demand the installment let alone terminate
the contract. The evidence does not indicate in any manner that the
construction was completed before the notice was issued through Adv.
Oswal. There is no proof that the defendant nos. 3 & 4, exercising options
under the agreement Exh.96 had terminated it. It was a simple thing which
the defendants alone could prove and were bound to prove. They led no such
evidence.
40] Adv. Mr. Oswal may have issued a notice as admitted by PW Mrs.
D'silva on 21/3/1979. But it is also established that the construction was not
completed at that time. It was brought out in the cross examination of PW 2
Pinto that there were no doors or window panes or toilet fittings in the suit
flat in 1979. The DW 1 Britto stated that the defendants 3 and 4 had left the
work incomplete and that was subsequently done by the defendant no.1
society. Even DW Ross Sheikh testified the same thing.
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41] It is therefore established that the construction work was not
completed before 1980-81. It was certainly not complete in March,1979 when
the defendants 3 and 4 issued notice through Adv. Oswal. The notice (not
produced) was therefore not in consonance with the agreement Exh.96.
Moreover, at that time, there was a confusing atmosphere prevailing with
flat allottees rushing to the site and asserting their right against another.
42] The plaintiffs did not pay anything to the defendants 3 and 4
after 1975. Even then, the evidence shows that till 13/1/78 (Exh.108) the
defendants recognized them as the allottee of the suit flat. Rest as stated
above, establishes that no stage wise construction was completed as could
enable the defendants 3 and 4 to terminate the agreement by the notice
through Adv. Oswal. There was no valid termination of the agreement. In
the background narrated in the beginning and in view of the evidence
discussed, it must be held that the agreement was not determined by the
defendants 3 and 4 and it did not stood terminated because the plaintiff did
not pay the balance of consideration of Rs. 47,000/-.
43] The plaintiffs had entered into the agreement Exh.96 in 1972-73.
That was acted upon for a long period. The plaintiffs paid more than 3 / 4 the
consideration and the agreement was not terminated. There was no reason
why the agreement could not be binding upon others.
44] One more aspect remains to be considered namely the allotment
of the suit flat to the deceased defendant no.6 G. M. Sheikh. DW Ross
Sheikh, his son took stand in the witness box on behalf of the defendants 7
and 8 . It is plain that his evidence was a substantial advancement over the
written statement. The evidence was very much beyond pleadings.
45] The defendants 7/8 did not plead that they were bonafide
purchasers for value without notice. The DW Ross deposed that. There is no
whisper in the written statement that his father had booked the suit flat in
1977 and had paid Rs. 40,000/-. It was no where pleaded that an agreement
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was entered into and that as well as receipts of payment of installments were
lost. The written statement is absolutely silent about the major particulars of
the agreement, the consideration agreed, and paid and so on. Even then,
minute particulars are testified in evidence by DW 1 Ross Sheikh. The
evidence is therefore wholly beyond pleadings and can not be acted upon.
46] It is observed in the earlier paras that a Bank pass book, without
supporting evidence of the banker is of no use. On that count alone, the pass
books Exh.156 to 158 filed by the plaintiff are kept out of consideration. For
similar reasons, the pass book Exh.199 filed by the defendants 7 and 8 can
not be accepted in evidence. Admittedly, the entries therein are not in the
handwriting of the witness. Instead of relying on the pass book, the
defendants could have produced a certified extract of the saving account as
per Bankers Book Evidence Act.
47] It is pertinent to note that the loss of the alleged original
agreement was not pleaded and the defendants did lay foundation for
adducing secondary evidence. In fact, the trial Court had directed them to
produce the agreement. They did not abide by that.
48] The defendants relied upon Exh.200/Exh.216 to show that the
suit flat was allotted to them. These are two copies of the same letter dated
29/11/78 issued by the defendant no.4 to the defendant no.1. It says that the
deceased G. M. Sheikh had booked a flat for Rs. 65,000/- and out of which Rs.
60,000/- was received by him. By the said letter, the defendant no.4 allotted
the suit flat to Shri. Sheikh and that the flat was canceled by its previous
allottee.
49] It is clear from the above letter Exh.200 that the suit flat was
allotted to Sheikh by virtue of that letter on the day on which it was
written namely 29/11/78. That falsifies the defence contentions that the
suit flat was allotted to them before the date on the letter. One important
aspect connected to the letters Exh.200 and 216 need mention here.
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Exh.200 was addressed to the defendant no.1. It was a carbon copy
forwarded to G. M. Sheikh and therefore, address of defendant no.1 at the
top was scratched. However, in its xerox copy Exh.216, the scratching does
not appear. There was no way in which both these letters could could reach
the defendants 7 and 8 or the deceased G. M. Sheikh. Exh.201 is the original
nomination form states to whom the flat was to be transferred in the event of
death of G. M. Sheikh. The said document should normally have been with
the society and not with the defendants. That raises suspicion.
50] Exh.174 to Exh.180 are receipts issued to G. M. Sheikh from
15/7/79 to 17/8/80 by the defendant no.1 society. They are not much useful to
the defendants. There is no resolution of the society allotting the suit flat to
the deceased G.K. Sheikh. In fact the D. W. Ross Sheikh admitted that the
documents at Exh.138 filed by the defendants 3 and 4 were copies of the
society (def.1) record issued by Deputy Registrar. In that document it is
shown that the deceased G. M. Sheikh was allotted not the suit flat but flat
no. R. A. 8 on 3rd floor . The said fact speaks a lot and the evidence through
Exh.174 to 180 ( like most other) being beyond pleadings, in the peculiar
circumstances for from corroborate the defence.
51] There is therefore absolutely no reason not to accept that the
agreement Exh.96, in favour of the plaintiff was binding on all. The learned
trial Court failed to understand the entire evidence. He appears to have
discussed nothing but the evidence of the plaintiffs. In the process, he
reached wrong conclusions. They cannot be sustained. For the present, the
point under consideration needs to be and is held in affirmative.
As to point no.4 : (on the question of dispossession)
52] The trial Court held that the plaintiffs could not show in the first
place that they were in actual possession and the question of dispossession
19 Civil Appeal no. 923/00
did not survive. In my opinion, the trial Court considered this entire aspect
from a wrong perspective. It was a multi storied building. The apartments
were allotted to buyers since prior to starting of construction or during
construction. The plaintiffs were one of the buyers. They had booked the suit
flat. It can not be imagined that unless the construction was completed they
could be placed in its possession. Till that time their possession was
constructive. That is demonstrated in this case by two factors. The first one
is the “pass” Exh.106 . Thereby PW 2 Pinto could visit 'his' (suit) flat during
construction. The second one is his letter (Exh.117) to the defendant no.4.
He stated therein that he wanted certain alterations to be made in the toilet
in the suit flat. The third important factor defining constructive possession
was that during subsistence of the agreement, the plaintiffs (with the
builder) could prevent trespass in the flat. From these points of view, they
could be held in constructive possession of the suit flat.
53] There is yet another angle to this case. It is described earlier how
a state of confusion and chaos prevailed in 1978 – 79 when the defendant
nos. 3 & 4 were accused of selling the same flat to more than one person. The
purchasers were rushing to the flats booked by them, fixing their own doors
and bolting and locking them, with a view to ensure possession. It is evident
from the evidence led by the plaintiffs that PW 2 Francis Pinto was also one
of such persons. He too had entered the suit flat, put his lock and ensured
possession of the suit flat on behalf of the plaintiffs. It also appears that he
was thrown out and the matter was reported.
54] The act of PW 2 Pinto ( like others alike him) in locking the suit
flat was illegal. Though the plaintiffs had booked the flat and the agreement
was subsisting, they nor Pinto had authority to take possession of the flat
unless the construction was completed. The defendants 3 and 4 alone could
deliver them that. That was not done. In spite of their booking, their act of
taking possession of th suit flat was not lawful.
20 Civil Appeal no. 923/00
55] That apart, the evidence suggests that by visiting the flat and
suggesting structural changes in the flat, the plaintiffs had demonstrated
their constructive possession over the suit flat. They were not in actual
lawful possession. Nevertheless, the foregoing discussion establishes that the
suit flat was subsequently delivered in actual possession of the deceased G.
M. Sheikh and the defendants 7 and 8 though the agreement Exh.96 with
the plaintiff was subsisting. From this angle must be held that the plaintiffs
were dispossessed from their initial constructive possession over the suit flat.
The point under consideration is therefore answered in affirmative.
As to point no. 5 : (as to the entitlement)
56] From the above discussions, it becomes clear that plaintiffs had
booked the suit flat way back in the year 1973. They paid more than Rs.
38,000/- out of the consideration of Rs. 47,000/-. The defendant nos. 3 & 4
regarded them as allottees of the suit flat even in 1978. The construction of
the building as well as the suit flat was never completed by the defendant
nos. 3 & 4. The defendant no.4 was charged for selling same flat in the
building to several persons . Finally , the purchasers had come together.
They had formed an association and ultimately the defendant no.1 society
which, under the apartments Ownership Act the defendant no.3 & 4 were
bound to constitute was formed. The agreement with the plaintiffs was not
terminated in the manner in which it was stipulated therein and the notice
issued through Adv. Oswal (not proved) could not determine the agreement
with the plaintiff. In fact, the defendant nos.3 & 4 were under legal
obligation to honour their commitment to the plaintiff and should have
effected necessary conveyance, inducting the plaintiff in possession of the
suit fat, of course on receipt of the balance consideration. Instead by their
mis-management, a chaotic situation arose and every purchaser tried to force
21 Civil Appeal no. 923/00
and establish his possession over the flat.
57] It cannot be said that the plaintiffs were entitled to the suit flat
at a price less than the agreed consideration of Rs. 47,000/-. There were
sufficient reasons which explained how the plaintiffs were justified in not
paying the balance consideration to the defendants 3 and 4. That apart, they
cannot be freed from that liability for ever. As stated above, the Co-operative
Court is competent to decide whether the plaintiffs should be made member
of the society and after that decision in their favour, the plaintiffs will have
to pay the balance consideration to the society.
58] It is established in the evidence that when the defendant nos.3 &
4 left the work undone , the defendant no.1 Society had collected a further
contribution @ Rs. 30/- per sft. from the purchasers to complete the work .
That would be another amount which the plaintiffs shall have to pay if their
claim of membership is allowed by the Co-operative Court, Pune.
59] For the reasons stated, the judgment and decree of the learned
trial Court cannot be sustained. The Court below committed a grave error in
dismissing the suit. No doubt , the Co- operative Court would alone be
competent to decide whether the plaintiff should be admitted as a member of
the society. However, I find no hesitation in holding that the plaintiffs were
allotted the suit flat by the builder and promoter in the year 1973. It is also
established that the agreement was executed in respect of the suit flat. The
plaintiffs had made payments of installments and were entitled to be
inducted possession. The action on the part of the defendants in placing the
deceased G. M. Sheikh in possession of the suit flat and in permitting the
defendants 7 and 8 and heirs of deceased to occupy the suit flat is illegal,
high handed and unlawful. This is more so because they failed to prove that
the suit flat was either booked by or allotted to them.
60] It would be necessary to make certain observations in order that
22 Civil Appeal no. 923/00
the reliefs granted are made effective. After the Co-operative Court decides
the claim of membership in favour of the plaintiffs, it would be necessary for
them to pay the balance consideration (Rs. 47000/- – 38245/-) either to the
defendants 3 and 4 or the Society. It would also be necessary for the
plaintiffs to pay improvement charges @ of Rs. 30 per sft. to the defendant
no.1 in view of the evidence that the society had effected the improvements
after the defendants 3 and 4 had left the work incomplete. It is needless to
state that the society would execute necessary conveyance. Therefore
answering the point under consideration accordingly, the order below is
passed .
ORDER
1] Appeal is allowed partly with proportionate costs.
2] The judgment and decree of the 6th Jt. CJSD, Pune in Spl CSno. 136/80 is set aside and the suit is decreed as follows.
a] The suit is decreed partly with costs.
b] It is hereby declared that the suit flat being flat no. V-A onthe third floor in Paramount Apartments Co-operative HousingSociety Limited, 1981, Convent Street, Pune, measuringapproximately790 Sft was and stood allotted to the plaintiff andthat, its subsequent allotment to and possession of deceased G.M.Sheikh (defendant no.6) and his heirs was illegal and not bindingon the plaintiffs.
c] The plaintiffs to approach the Co-operative Court Pune foradjudication of her claim of membership in continuation withthe earlier proceedings in that Court.
4] Decree be drawn up accordingly.
5] Informed accordingly.
Date : 8/1/2007 [S. G. Deshpande] [Ad hoc District Judge-12,Pune]
23 Civil Appeal no. 923/00
I affirm that the contents of this P. D. F. file Judgment are same wordfor word as per original Judgment.
Name of Steno : Smt. S. K. DoiphodeCourt Name : S. G. Deshpande, Ad-hoc District Judge-12,PuneDate : 9/1/2007
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