1998(2) ALL MR 246
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
S.S. NIJJAR, J.
Nircon Developers Pvt. Ltd. And Ors. Vs. Zohrabai Fakhruddin And 22 Ors.
Notice of Motion No.2149 of 1994,Suit No.3308 of 1994
11th November, 1997
Petitioner Counsel: Mr. HUMRANWALA i/b HUMRANWALA & CO.
Respondent Counsel: Mr. MILIND VASUDEO with Mr. SHIRALKAR i/b SHIRALKAR & CO., Mr. D. D. MADAN with Mr. RAHUL NARICHANIA i/b GAGRAT & CO., Mr. R. M. KADAM with Mr. A. GADKARI, Ms. ANITA CASTELINA i/b PANDYA & CO., Mr. JANAK DWARKADAS with Ms. RAJDAN i/b MALVI RANCHODDAS
Specific Relief Act (1963), S.37 - Suit for declaration and injunction - Suit based on oral agreement for sale of property - Agreement being contrary to provisions of Income-Tax Act no relief could be granted.
Income Tax Act (1961), S.269 UC.
A suit was brought for declaration and injunction on the basis of oral agreement for transfer of immovable property. The agreement was drafted but was not signed to avoid legal implications.
Held, that the High Court or indeed any other Court cannot be a party to deliberate infringement of the law. This kind of an agreement even if it existed would be void as it is contrary to public interest being contrary to the statute. [Para 7]
JUDGMENT :- This suit has been filed by the plaintiffs making a number of prayers. A declaration is sought to the effect that there is a valid and subsisting agreement for sale and development the plaintiffs and the defendant Nos.1 to 19 and 21 in terms of the document at Exhibit-Q and that the same is binding on the said defendants. A declaration is also sought to the effect that the agreement to lease dated 31-1-96 alleged to have been executed by the MMRDA in favour of defendant No.22 and the agreement dated 17-2-1997 alleged to have been executed by defendant No.22 in favour of defendant No.23 are null and void and have no legal effect. It is further prayed that this Court be pleased to cancel the aforesaid agreement to lease dated 31-1-97 and the agreement dated 17-2-1997. A further declaration is sought to the effect that the 140 documents as per particulars set out in Exhibit-88 executed by defendant Nos.1 to 14 in favour of Defendant No.22 are null and void. A further declaration is sought that it is defendant Nos.1 to 19 and 21 who are under an obligation to apply for permission and/or sanction to the Appropriate Authority under Chapter XX-C of the Income Tax Act by filing the necessary Form 37-I. It is also prayed that defendant Nos.1 to 19 and 21 be ordered to specifically perform the obligation in prayer clause (b) and to execute the confirmation letter confirming the agreement contained in prayer clause (a) and to execute and submit Form 37-I under the provisions of Chapter XX-C of the Income-Tax Act within 15 days of the execution of such confirmation letter for obtaining sanction or permission under the provisions of Income Tax Act.
2. This Notice of Motion has been taken out with a prayer for appointment of Receiver and injunction restraining defendant Nos.1 to 19 and 21 from dealing with, disposing of, alienating, encumbering, parting with possession or creating any third party rights in the suit property which is said to be described in Exhibit-A to the plaint. An injunction is also sought against Defendant No.20 restraining the said defendant from granting or executing any lease in favour of the defendants or any of them. It is further prayed that pending the hearing and final disposal of the suit defendant No.22 be restrained from completing any transaction in favour of defendant No.23 pursuant to the agreement dated 17-2-1997 and also that the defendant No.23 be restrained from making any further payment to defendant No.22 and from taking possession of the suit property. An affidavit in support of the Notice of Motion has been filed.
3. It is the case of the plaintiffs that there was a valid and concluded contract for sale of the suit property by the defendant Nos.1 to 14 to the Plaintiffs. Plaintiff No.1 is a Company incorporated under the provisions of the Companies Act. Plaintiff No.2 is a Director of Plaintiff No.1 Plaintiff Nos.3 and 4 are the brother and uncle respectively of plaintiff No.2, who are stated to be builders and developers. In paragraph 2 of the plaint it is stated that defendant Nos.1 to 14 are the co-owners of the property described therein bearing survey Nos.110/2, 113/1 and 2, 115/2(Pt.) and CTS No.139 to 144, 153, 153/11011, 151/27, 153/28, 153/34, 153/35, 153/36, 153/371038, 153/39, 153/40, 153/421043, 153/49, 153/45, 153/46, 153/477048, 153/49, 153/50 situate at Village Goregaon in Greater Bombay in the registration sub-district of Bandra Taluka South Salsette and Dist. Bombay containing by admeasurement 56011.68 sq.yds. equivalent to 46830 sq.mts. or thereabout being the property more particularly described in the Schedule at Exhibit-A to the plaint, hereinafter referred to as "the suit property". According to the plaintiffs the suit property falls within the area of 102 hectares of land at Goregaon/Jogeshwari demarcated by the Government of Maharashtra as "Oshiwara District Centre" to be developed as a business district as an alternative to the Bandra-Kurla Complex. The Government of Maharashtra in exercise of the powers under the Maharashtra Regional Town Planning Act, 1966 has, inter alia, vide its notification dated 16-1-1992 declared defendant No.20, a statutory body as the Special Planning Authority for planning and developing the said Centre. Under the Scheme framed by the Government of Maharashtra, in order to ensure owners participation in development of the said centre the BMRDA is to issue notification for acquisition of the land at the notional rate of Rs.1/- per hectare and the same land would then be leased back by the BMRDA to the land owner for development at a lease premium of Rs.750/- per sq.ft. for commercial zones and Rs.500/- for residential zones. Defendant No.15 is a partnership firm carrying on business as builders and developers. Defendant No.15 had entered into an agreement dated 17th March, 1982 with defendant Nos.1 to 14 for development of the suit property. The defendant No.15 firm has been dissolved and their interest has been taken over by defendant No.21. According to the plaintiffs, defendant Nos.1 to 14 had orally agreed to sell the suit property at or for the total consideration calculated at the rate of Rs.395/per sq.ft. of available FSI (less costs incurred by Plaintiff by way of premium payable to BMRDA, providing alternative accommodation to the tenants, development charges etc.) and on the terms and conditions set out in the plaint. It is the case of the plaintiff that the defendants have accepted the cheques from the plaintiffs for Rs.15 lakhs towards part payment of the aforesaid consideration. The plaintiffs state that in the first week of December, 1993, the plaintiff No.2 was introduced to defendant Nos.1 to 14 to conduct negotiations for the sale of the suit property. On 25th December, 1993 a meeting was held at the residence of Defendant No.16 between the plaintiff No.2 and defendant Nos.5, 7, 12, 14 and 16. At this meeting the consideration for the sale of the property was agreed upon. The second meeting was held on 8-1-1994 allegedly in the office of the Solicitor again between the same parties. In the first meeting itself the parties had also agreed on the schedule of payment. It was also agreed that the preparation of the agreement for sale as per the concluded contract be entrusted to Mr. Shrikant Shah, Solicitor. The Plaintiffs thereafter approached Mr. Shrikant Shah for necessary documentation. Mr. Shah requested a joint meeting of the Plaintiffs and the defendants and their Advocates. Thus the second meeting was held on 8-1-94 at the office of Mr. Shrikant Shah. At that meeting it was agreed that certain documents shall be furnished by the defendants to Mr. Shah to enable him to prepare the agreement for sale as per the decision and agreement between the parties. By their letter dated 12-1-94 the defendants furnished copies of certain documents to Mr. Shah. On 17-1-1994 the plaintiffs sent cheque of Rs.10,000/- to their Solicitor Mr. Shrikant Shah towards his legal fees. On 18-1-94 another meeting was held between the parties at the office of Defendant No.15. On 18-1-1994 the terms of the oral agreement entered into between the parties on 25th December, 1993 were briefly and succinctly summarized and there and then typed out on a sheet of paper. It is specifically pleaded on page 13 of the plaint as follows.
"The said typed sheet was not signed by the parties with a view to avoid any legal complications that may have arisen with regard to the provisions of Chapter XX-C of the Income Tax Act."
On the basis of the aforesaid a draft agreement was forwarded to the defendants to make any amendments therein. It is the case of the plaintiffs that pursuant to and in part performance of the plaintiffs obligation the plaintiffs made payment of an amount of Rs.15 lakhs by cheque to defendants as and by way of on account payment of the earnest money of Rs.1 crore which was payable by the plaintiffs to the defendants on execution of the formal agreement on stamp paper. The plaintiffs issued (i) 2 cheques for Rs.2.5 lakhs each to defendant No.15 (ii) cheque for Rs.2.5 lakhs in favour of defendant No.5, (iii) cheque for Rs.2.5 lakhs in favour of defendant No.7, (iv) cheque for Rs.2.5 lakhs in favour of Defendant No.9 and (v) cheque for Rs.2.5 lakhs in favour of defendant No.12. The draft agreement signed by Mr. Shah was returned after making necessary corrections by defendant No.16. These amendments were incorporated in the draft agreement. It is the case of the plaintiffs that Mr. Shah thereupon finalised the agreement for sale and the same was handed over by defendant No.16 to the plaintiffs in March, 1994. This agreement is attached with the plaint as Exhibit-Q. It is the case of the plaintiffs that Exhibit-Q is a concluded contract between the parties containing all the terms and conditions agreed upon by the plaintiffs and the defendants. It is stated that the aforesaid agreement contained an implied agreement to obtain permission or sanction of the Appropriate Authority as required by the provisions of Chapter XX-C of the Income Tax Act. The defendants are bound to comply with the said obligations by executing the necessary Form 37-I prescribed by the Income Tax Act. After receiving the aforesaid draft agreement the defendants have started making various excuses for being unable to execute the agreement on stamp paper in terms of the approved agreement. According to the plaintiffs, the defendants are now trying to withdraw and renege from their commitments under the agreement with the ulterior motive of profiteering from the escalation in price of real estate property. Thus the prayers have been made for specific performance of the said agreement. By an amendment it has been pleaded that after the present suit was filed, defendant Nos.1 to 14 have individually and separately purported to convey their respective undivided shares in varying parts or portions of the suit property to one Wonderland Estate Developers Pvt. Ltd. under 140 separate conveyances alleged to have been executed by defendant Nos.1 to 14. Thus the aforesaid firm has been impleaded as defendant No.22. It is stated that defendant No.22 is only a front organisation of defendant Nos.15 to 19 and 21. The shareholding of defendant No.22 is held and controlled by defendant Nos.15 to 19 and 21. The documents in question have been executed on behalf of Defendant No.22 by Dilawar Nensey s/o defendant No.16. The 140 conveyances have been executed by defendant Nos.1 to 14 in collusion with defendant Nos.15 to 19 and 21 with the sole object of attempting to delay and/or defeat the plaintiffs right and claim to the suit property. It is stated that defendant No.22 have allegedly paid almost Rs.6 crores. This is, however, said to be much less than the market price of the suit property. Thus it is stated that the aforesaid conveyances are null and void. Defendant No.23 has been impleaded in view of the affidavit filed when the Notice of Motion came up for hearing on 4th September, 1997. In the affidavit filed by Defendant No.22 it was claimed that by an agreement dated 31-1-1996 between defendant No.22 and MMRDA, defendant No.22 consented to the acquisition of the suit property by the Special Land Acquisition Officer appointed by the State Government and that pursuant to the said agreement MMRDA had acquired the suit property and had thereafter entered into an agreement dated 2nd April, 1996 to lease the suit property to defendant No.22 for a period of 60 years on a payment of lease premium. Defendant No.22 has also entered into an agreement dated 17-2-1997 with defendant No.23 for sale and transfer of the benefits of the said agreement between defendant No.22 and the MMRDA in respect of a portion of the suit property admeasuring about 21512 sq.mts with the right to use the FSI of 5,80,000 sq.ft. at the consideration and on the terms and conditions set out therein. This agreement has been submitted to the Appropriate Authority under Chapter XX-C of the Income Tax Act. This transfer in favour of defendant No.23 is said to be another attempt to avoid any orders which may be passed by this Court in the Suit. In view of all this continuous alienation of the property the plaintiffs have registered a notice of lis pendens on or about 1st September, 1994. It is stated that in view of the pending litigation the transfers in favour of defendant No.22 and 23 are not bona fide.
4. In reply to the aforesaid pleadings of the plaintiffs all the defendants have virtually denied the whole claim. Affidavit filed by defendant No.5 on behalf of defendant Nos.1 to 14 is detailed and is dated 29-1-1996. It is stated that the defendants had filed an affidavit to oppose the ad-interim application on 25th August, 1994. The averments made therein are reiterated. It would, therefore, be useful first to refer to the averments made in the earlier affidavit dated 25th August, 1994. In this affidavit it is categorically denied that there was any concluded contract and/or agreement by and between the parties to the suit. It is stated that the claim put forward by the plaintiffs is wholly false as is evident from the facts narrated in the plaint. As the plaint progresses, the plaintiffs have pleaded and alleged four agreements and have jettisoned one in favour of the succeeding one. It is stated that the suit is filed with a view to pressurise the defendants. Negotiations between the parties are admitted. Further it is stated that the said negotiations broke down as a result of disagreement over several issues, thus the negotiations remained inconclusive and were in fact abandoned. During the period of negotiations some of the owners asked the plaintiffs to deposit a relatively small token amount of money to show their bona fides and as a precondition to commence negotiations. These amounts were received without any intention of creating any legal relations. The payments in fact were made. Plaintiff Nos.2, 3 and 4 did not feature in the negotiations as party intending to purchase. Even otherwise it is stated that the plaintiffs have miserably failed to show that there is a concluded contract. It is stated that plaintiff Nos.2, 3 and 4 have been added as plaintiffs although they did not feature as purchasing party in the alleged draft agreement, Exhibit-Q to the plaint. They have only been impleaded in order to claim that the money was paid to some of the defendants as consideration under the alleged agreement for sale. Defendants have not signed any agreement or writing or even a receipt in favour of the plaintiffs. It is reiterated that the plaintiffs have alleged four agreements and have jettisoned each in favour of the succeeding agreement. Even the last agreement, Exhibit-Q to the plait contains several blanks regarding material particulars and is admittedly not signed by any of the parties. The said agreement was allegedly handed over in March, 1994 but still bears the month of January on the first page thereof. It is specifically denied that there was any agreement arrived at between the parties on 25th December, 1993 or on 18-1-1994 or at any other time. It is stated that a perusal of the plaint itself makes it abundantly clear that there is no agreement between the parties. The plaintiffs first allege an agreement on 25th December, 1993. Thereafter to explain away the meeting dated 18-1-1994 it is alleged that the said agreement dated 25th December, 1993 was finalised and written on 18-1-1994. To explain away the lack of writing and want of clearance of Appropriate Authority under Chapter XX-C of the Income Tax Act it is alleged that the typed sheet was not signed with a view to avoid legal complications that may have arisen with regard to the provisions of Chapter XX-C of the Income Tax Act. Thereafter further agreements being Exhibits-P and Q are also alleged to have come into existence in January and March, 1994. Thus it is submitted that the entire pleadings are inconsistent with each other. This is said to be a feeble attempt to spin a yarn on the basis of non-existing fabric of falsehood and blatant lies. Apart from the aforesaid there is admittedly no clearance under the provisions of Chapter XX-C of the Income Tax Act. The plaintiffs have also approached this Court after a period of almost 6 to 8 months after the alleged agreement. Thus the plaintiffs application suffers from inordinate delay and laches and for these reasons the plaintiffs are not entitled to any reliefs.
5. In addition to the aforesaid averments in the affidavit filed on 29-1-1996 it is stated that plaintiff Nos.2, 3 and 4 are wrongly joined as plaintiffs as they are not even mentioned in the draft agreement, Exhibit-Q. It is denied that there was any agreement between the plaintiffs and the defendants. It is emphatically denied that in the meetings mentioned earlier by the plaintiffs that one or the other defendants were acting in a representative capacity of the other defendants. It is also denied that there was any concluded agreement, oral or otherwise, between the parties. The existence of any agreement between the parties has been denied repeatedly. It is denied that a sum of Rs.15 lakhs was received by some of the defendants from the plaintiffs in part performance of any agreement for sale. The other defendants have filed affidavits which also deny the averments made in the plaint. In the affidavit filed by defendant No.16 it is stated that the plaintiffs have filed the suit with a view to harass and malign the defendants. The plaintiffs have mala fide intentions and have come to the Court to build up a case against the defendants which never existed. Averments made by defendant No.5 with regard to plaintiff Nos.2, 3 and 4 are repeated. It is stated that defendant No.15 has been dissolved in 1983. Thus there was no question of defendant No.15 representing any of the defendants. In any case defendant No.15 was a partnership firm. Thus an individual partner could not have executed any agreement.
6. On the basis of the aforesaid pleadings. Counsel for the parties have made their submissions. All the Counsel have reiterated what has been pleaded. Mr. Humranwala, Counsel appearing for the plaintiffs, has stated that there is a concluded oral agreement on 25-1-1994. This agreement was reduced to writing. On the basis of said agreement the document Exhibit-Q has been executed. It is submitted by Mr. Humranwala that a perusal of Exhibit-Q would show that all the necessary ingredients for a concluded contract are fulfilled. According to the Counsel, the property which is sought to be sold is properly described. The consideration has been agreed upon and the mode of payment has also been agreed upon. In view of the above, it is submitted that the plaintiffs are entitled to the interim relief. It is submitted that the case of the plaintiff is buttressed by the fact that Rs.15 lakhs have admittedly been received by the defendants. This amount has been paid on account of part performance of the contract which is contained in Exhibit-Q. In order to protect their interest the plaintiffs even went so far as to register a notice of lis pendens. Inspite of the said notice illegal conveyances have been executed in favour of defendant No.22 and the property has further been transferred in favour of defendant No.23. It is submitted by Mr. Humranwala that the aforesaid facts make it abundantly clear that the interest of the plaintiff has to be protected. In the event no interim relief was granted it would be impossible to compensate the plaintiff in terms of money for the damage that may be caused to the plaintiff. Mr. Humranwala has laid emphasis on the fact that meetings were held between the parties as narrated above. In those meetings all the defendants were represented by one or the other defendant. The terms of the oral agreement were reduced to writing on 18-1-1994 on the basis of the oral agreement dated 25th December, 1993. Although the aforesaid agreement was reduced to writing and it was typed out in the office of defendant No.15, the same has not been signed by any of the parties in order merely to avoid any legal complications that may have arisen with regard to the provisions of Chapter XX-C of the Income Tax Act. This kind of an oral agreement can form the basis of a suit for specific performance. Mr. Humranwala has relied on a judgment of the Supreme Court in the case of Kollipara Sriramulu Vs. Aswatha Narayana and Ors. (AIR 1968 S.C. 1028). In the said judgment the Supreme Curt has categorically held as follows:-
"It is well established that a mere reference to a future formal contract will not prevent a binding bargain between the parties. The fact that the parties refer to the preparation of an agreement by which the terms agreed upon are to be put in a more formal shape does not prevent the existence of a binding contract. There are, however, cases where the reference to a future contract is made in such terms as to show that the parties did not intend to be bound until a formal contract is signed. The question depends upon the intention of the parties and the special circumstances of each particular case...."
It is also submitted by Mr. Humranwala that merely because the writing dated 18-1-1994 was not signed by the parties does not mean that the earlier oral agreement dated 25-12-93 is not binding. The writing dated 18-1-94 is proof of the oral agreement dated 25-12-93. Inspite of the oral agreements the Defendants are not executing the formal conveyance. Mr. Vasudeo on the other hand has submitted that although the specific performance of the agreement in Exhibit-Q is sought on the basis of an agreement dated 25th December, 1993, in the prayer clause the specific performance of the oral agreement dated 25th December, 1993 is not sought. It is submitted that the oral agreement dated 25th December, 1993 is an afterthought as the said agreement does not find any mention even in the draft agreement, Exhibit-Q. If the said agreement had actually been in existence then surely Exhibit-Q would have been based on the said oral agreement. Mr. Vasudeo further submits that there is really no need for any detailed discussion of any principle of law in this particular case to come to the conclusion that there is no concluded contract, as merely reading the agreement Exhibit-Q would demonstrate that there is no concluded contract. Mr. Vasudeo has relied on an unreported judgment of this Court given in Notice of Motion No.785 of 1991 in Suit No.1063 of 1991 (Anwarali Lakhani & Anr. Vs. Charles Alexander Gonsalves and Ors.) to submit that a mere perusal of the agreement Exhibit-Q would show that there is no concluded contract. Mr. Vasudeo has further submitted that assuming that there is a concluded contract even then the same cannot be ordered to be specifically performed as this agreement would be contrary to the provisions of Chapter XX-C of the Income Tax Act. It is submitted that the plaintiffs have in terms admitted that even the oral agreement which was supposed to have been reduced to writing was not signed so that no complications would arise for fulfilling the obligations under Chapter XX-C of the Income Tax Act. Mr. Madan appearing for defendant Nos.15 to 19 and 21 has reiterated the stand taken by Mr. Vasudeo. He has, however, submitted that even if it is assumed that Exhibit-Q is a concluded contract, the same cannot be specifically performed. Firstly, Mr. Madan says that there are no agreed ingredients for a concluded contract of sale. The price has not been fixed. The property has not been properly described. There is no demarcation of the property. There is absence of permission under Chapter XX-C of the Income Tax Act. Plaintiff Nos.2, 3 and 4 are not even parties to the agreement and yet they are claiming relief of specific performance. It is further submitted that a perusal of payment clause 10 of the agreement would show that a sum of Rs. One Crore was to be paid by the plaintiffs to the defendants before the execution of the agreement. Even if the plaintiffs are to rely on the oral agreement dated 25th December, 1993 then they ought to have made the payment of Rs. One crore before 25th December, 1993. They have not even made the payment upto the alleged execution of the agreement Exhibit-Q. Thus it is submitted that they can hardly claim any discretionary relief from this Court. Apart from all this, Mr. Madan has submitted that a bare perusal of the agreement would show that it s merely a developmental agreement. This agreement, according to Mr. Madan, cannot be ordered to be specifically performed. Apart from all this, it has been submitted by defendant No.22 that the scheme has been partly implemented under the MMRDA Act. Therefore, it would not be possible to grant any relief in the nature of interim injunction to the plaintiffs. Mr. Dwarkadas appearing for defendant No.23 has made certain additional submissions. It is submitted that a perusal of the prayer clause would show that the plaintiffs are not seeking specific performance of the oral agreement. They are seeking specific performance of the agreement attached as Exhibit-Q to the plaint. According to Mr. Dwarkadas, a bare perusal of the said agreement would show that the essential ingredients for creating a concluded contract are missing from the said agreement. According to the Counsel, neither the property has been identified nor the consideration has been properly mentioned. The whole agreement in fact proceeds on the basis of certain obligations which are to be performed by the parties. The conveyance is only to be executed after a clear title has been obtained by the defendants. This could only be obtained after the interest of the third parties viz. the tenants and other occupiers have been satisfied. These obligations are to be performed by the owners and/or developers. Even the list of tenants and occupiers is described firstly as enumerated in Schedules 2 and 3 and thereafter the list is supposed to be attached to letters mentioned as Letter-A and Letter-B. In one of the clauses the earlier terms are reiterated that all claims of third parties are to be settled by the owners and/or developers. Adverting to the judgment of the Supreme Court cited by Mr. Humranwala, it is submitted by Mr. Dwarkadas that the said judgment was given before coming into operation of Chapter XX-C of the Income-Tax Act. By virtue of the provisions of Chapter XX-C of the Income Tax Act and in particular provisions of Section 269 UC read with Rule 48(L), no oral agreement can be ordered to be specifically performed. The agreement is to be in writing in the form prescribed in Section 269 UC read with Rule 48(L). If the agreement is not in the form prescribed by the Act, parties are liable to prosecution under Section 277 of the Income Tax Act. This is so because the agreement is required to be verified before it satisfies the provisions of the Act and the Rules. In view of the above, it is submitted that the aforesaid judgment will be of no avail to the plaintiffs. Even otherwise it is submitted that there is no evidence whatsoever of any oral agreement which maybe in existence. Plaintiff Nos.2, 3 and 4 in fact are not even mentioned in the agreement Exhibit-Q.
7. I have considered the submissions made by the Counsel. I am of the view that the plaintiffs have failed to make out a prima facie case for the grant of any interim relief for a number of reasons. Reading the Agreement Exhibit-Q itself leaves no manner of doubt that what has been submitted by the Counsel for the defendants is correct. Not only there are blanks in the agreement but all the Schedules which have been referred to therein are not attached with the agreement. A perusal of the agreement shows that the agreement is supposed to be between plaintiff No.1 and defendant Nos.1 to 14. The registered office of the plaintiff No.1 has, however, been left blank. On page 2 of the agreement there is a recital to the effect that some of the purchasers of the suit land have created equitable mortgage in resect of the said property in favour of some unknown person as the space provided for filling in the name of the said person is left blank. Some of the property is said to have been inherited by some of the persons on page 5 from one Tarabai whose date of death is left blank. Some area of the suit property is said to be in the occupation of the lessees but the measurement of the said property is left blank. Clause 6 stipulates that owners and developers agreed to settle with all the occupants, tenants and/or trespassers who are in the property irrespective of the fact whether they are set out in the second Schedule and/or third schedule and see to it that each one of them enters into an agreement with the owners and/or developers within a period of (blank) months from the date hereof. In the some clause it is provided that in the event the owners and/or developers fail to enter into agreements for vacating the premises in their occupation with all the said tenants and/or occupants and/or trespassers who are in the property within a period of (blank) months, the developers shall have the discretion to cancel the agreement. In clause 10 the consideration is set out. The rate per sq.ft. has been left blank. The said rate is also worked out on the FSI available less the FSI of the lift or lifts and passages. It is stated that the ratio of 60 per cent and 40 per cent will be paid to owners and the confirming party. It is stated that the owners and the confirming parties are expecting the total FSI of about 10,84,785 sq.ft. The total purchase price under the agreement, therefore, comes to Rs.32,54,35,500/- out of which sum Rs.19,52,61,300/- is to be paid to the owners and a sum of Rs.13,01,74,200/- is to be paid to the confirming parties. Sub-clause 10(1) clearly states that a sum of Rs. One crore will be paid before the execution of this agreement being part payment of the purchase price. Clause 12 states that the owners declare that they may be in a position to get the clear title including to bring IOD and CC to an area admeasuring about (blank) delineated in the plan annexed, though the owners are only lessees and (blank) are the lessors thereof. On page 37 of the agreement, there is a mention of three Schedules. None of these schedules are, however, attached to the agreement. The agreement is neither signed by the vendors nor by the confirming parties. In the aforesaid state of affairs, it would be difficult for this Court to prima facie come to a conclusion that there is a concluded contract between the parties. The essential ingredients of conveyance of an immovable property are that the consideration must be fixed, generally the mode of payment of the consideration should also be fixed, the time schedule for the payment should also be fixed and the property should be fully described in the first Schedule to the Agreement. Even according to the averments made in the plaint the property is said to be described in various documents referred to as second schedule, third schedule, letter-A and letter-B. In these set of circumstances it cannot be said that Exhibit-Q is an agreement which contains a concluded contract. The argument of Mr. Humranwala that Exhibit-Q is only a consequential recording of the earlier agreement dated 25th December, 1993 is not supported by any of the pleadings or the documents on record. Even the judgment of the Supreme Court cited by Mr. Humranwala would not be applicable in the facts and circumstances of this case. In that very judgment having held that a mere reference to a future formal contract will not prevent a binding bargain between the parties, the Supreme Court holds that there are, however, cases where the reference to a future contract is made in such terms as to show that the parties did not intend to be bound until a formal contract is signed. In the present case formal contract is a precondition in view of the provisions of Chapter XX-C of the Income Tax Act. Admittedly, no such agreement as envisaged under Chapter XX-C of the Income Tax Act has been entered into between the parties. The very purpose of the provisions of Chapter XX-C is to prevent the properties ostensibly being sold at a value which is far less than the market value, thus depriving the State of valuable revenue. These provisions have been brought in to protect the public interest. In view of the above, even if there was an oral agreement dated 25th December, 1993 it could not be ordered by this Court to be specifically performed. The plaintiff himself has stated that there was no written agreement as executing such an agreement would have entailed complying with provisions of Chapter XX-C of the Income Tax Act. It is stated that the document dated 18-1-1994 wherein the terms of the oral agreement dated 25th December, 1993 were reduced to writing was deliberately not signed in order to avoid any legal complications that may have arisen with regard to the provisions of Chapter XX-C of the Income Tax Act. In my opinion, this averment by itself is sufficient to deny any discretionary relief to the plaintiff. This Court or indeed any other Court cannot be a party to deliberate infringement of the law. This kind of an agreement even if it existed would be void as it is contrary to public interest being contrary to the statute. On this ground alone I am of the opinion that the Notice of Motion deserves to be dismissed.
8. Apart from this, Mr. Vasudeo has relied on an unreported judgment of this Court in Anwarali Lakhani's case (supra) which has been noticed above. In that judgment, Justice Agarwal construing similar facts and circumstances has come to the conclusion that there is no concluded contract between the parties. In the present case, even according to the plaintiff, a draft agreement was sent to Defendant No.16. He is alleged to have made certain corrections in hand in the draft agreement. These corrections are said to have been incorporated in the said agreement. Yet, neither the oral agreement dated 25th December, 1993 nor this alleged draft agreement find any mention in the agreement Exhibit-Q. Had there been any such agreement, the same would have surely been mentioned in Exhibit-Q. Construing a similar document Justice Agarwal has observed as follows in paragraph 12 of the judgment in the case of Anwarali Lakhani (supra).
"12. The draft agreement dated the 12th of May, 1989, in my view, does not improve the case of the plaintiff. The original draft agreement has been placed for my perusal. It contains various corrections and alterations. Who has carried out the corrections and alterations has not been clarified. The draft contains an endorsement "draft approved" and it bears the signatures of both the executors. What is annexed at Exhibit-P to the plaint appears to be corrected copy of the draft. The draft contains different spaces for the signatures of the vendors as also the purchaser. The same has not been signed by the parties. It is merely a draft and hence it cannot be construed to be an agreement arrived at between the parties. In the circumstances I hold that there is no concluded agreement between the parties for sale of the suit property. The parties were at best at the stage of negotiations. Had they arrived at certain terms nothing prevented them from executing the draft agreement on the 12th of May, 1989. In the circumstances I hold that the plaintiff has not made out a prima facie case for grant of a decree for specific performance."
In my view, the aforesaid observations are fully applicable to the facts and circumstances of this case as I am also of the view that the parties were only at a negotiating stage. Justice Agarwal has also refused to grant any relief in the said judgment on the very same ground which has been pressed into service by the defendants with regard to the non-compliance of the provisions of Income Tax Act. In paragraph 13 of the said judgment it is observed as follows:-
"13. Even if one were to hold that there is a valid and enforceable agreement between the parties there is one more hurdle in the way of the plaintiffs for grant of the relief of specific performance. The agreement, if any, was entered into in the year 1988-89. The parties to the agreement have taken no steps to obtain the necessary permission under Chapter 20-C of the Income Tax Act. Under Sections 269 UC and 269 UL, 20-C read with Rule 48-K and 48-L the parties to the agreement were expected to take steps under the said provisions within a period of 15 days from the date of the agreement. Non-compliance with the provisions are made penal under Section 276. It is common ground that no application has been made under the said provisions upto date. Any application to be made hereinafter will naturally be time barred. Hence, the Court would not grant specific performance of an agreement, the enforcement of which is illegal and is also made penal. The plaintiff will at the best be entitled to decree for damages".
Mr. Madan has also submitted that a bare perusal of the agreement would show that it is in the nature of a developmental agreement. Thus, according to the settled law, the relief of specific performance could not be granted to the defendants. In my opinion, it is not necessary to consider this argument as the plaintiffs have failed to make out a prima facie case on numerous other grounds.
9. It may also be noticed that the suit property has been demarcated by the Govt. of Maharashtra as Oshiwara District Centre. Under the provisions of the Maharashtra Regional Town Planning Act, 1966 defendant No.20 has been declared as the Special Planning Authority for planning and developing the said Centre by its notification dated 16-1-1992. According to the Counsel for Defendant No.20, the scheme is already partly implemented. In view of the above, granting any interim relief to the plaintiffs would be clearly against the public interest. It would unnecessarily delay and jeopardise the development of the aforesaid Centre. Furthermore, I am of the opinion that any damage which may have been caused to the plaintiff can well be compensated by award of damages in the event they succeed in the suit ultimately. At this stage I am informed by the Counsel for the parties that this Court vide its order dated 6th Sept. 1994 declined to grant any ad-interim relief to the plaintiffs. However, whilst declining to grant the ad-interim relief it was directed that defendant Nos.1 to 14 shall deposit the sum of Rs.10 lakhs in this Court within two weeks therefrom. Similarly defendant Nos.15 to 19 were directed to deposit a sum of Rs.5 lakhs. On deposit of the said amounts, the plaintiffs were permitted to withdraw the said amount without furnishing any security. I am also informed that the appeal filed against the said order was dismissed as withdrawn. According to Mr. Wasudeo, the amounts directed to be deposited have actually been deposited in this Court. It is upto the plaintiffs as to whether or not they wish to exercise the option to withdraw the said amount.
11. At this stage Counsel for the plaintiff submits that their interest qua defendant Nos.22 and 23 at least be protected. In my view there is absolutely no necessity of any order to be passed by this Court in view of the admitted position that the plaintiffs have already registered a notice of lis pendens on 1-9-1994. Hence the prayer is rejected.