Prakash Gobindram Ahuja Vs. Ganesh Pandharinath Dhonde and Others - Court Judgment

1. This appeal by the plaintiff in Special Civil Suit No.104 of 2012 before the IInd Joint Civil Judge, Senior Division, Kalyan questions the order passed by him below Exhibit-5, rejecting his application to restrain defendant No.7 from creating third party interests in the suit property pending hearing of the suit.

2. It is the appellant's case that defendant Nos.1 to 6 owned the suit land and agreed to sell it to the plaintiff by two Agreements of Sale for Rs.30,00,000/- and Rs.17,40,000/-, of which the agreement for Rs.30,00,000/- was registered on 28-1-2011 and the other agreement remained to be registered. The plaintiff paid to defendant Nos.1 to 6 Rs.13,36,600/- towards the transaction. Defendant Nos.1 to 6 however executed registered sale deed in favour of defendant No.7 on 29-3- 2012 and the plaintiff now apprehends that defendant No.7 may create third party interests pending the suit. He, therefore, sought temporary injunction by application Exhibit-5 in the suit filed by him. The application was rejected by the impugned order, holding that the plaintiff had not made out a prima facie case and balance of convenience was not in favour of grant of injunction as the plaintiff had not shown that any irreparable loss would be caused if injunction was not granted. Aggrieved thereby, the plaintiff preferred this appeal and sought an injunction pending hearing of the appeal.

3. When the matter came up for hearing, on my remarking that in view of my Judgment in Kachhi Properties v. Ganpatrao Shankarao Kadam and Others, reported in 2010 (5) Bom.C.R. 43, since the appellant/plaintiff had not made out a case that protection under Section 52 of the Transfer of Property Act, 1882 (for short, “TP Act”) was not adequate, the appeal was liable to be dismissed, the learned counsel for the appellant pointed out that in Pralhad Jaganath Jawale and other v. Sitabai Chander Nikam and others, reported in 2011 (6) Bom.C.R. 619 an Hon'ble Single Judge had carefully considered the Judgment in Kachhi Properties (supra) and had concluded that in view of binding precedents of the Apex Court, the observation in Kachhi Properties, that provisions of Order 39, Rule 1 of Code of Civil Procedure, 1908 (for short, “CPC”) could be invoked only if protection provided by Section 52 of the TP Act is shown to be inadequate, could not bind the Court and the finding that Section 52 of the TP Act provides adequate protection did not create a binding precedent.

4. This necessitated a fresh look, - or rather, a second fresh look, since in Kachhi Properties I was required to re-examine the same issue which I had decided earlier in Sharad Jamnadharji Mor v. Arjun Yeshwant Dhanwatey and Anr., reported in 2009 (4) Bom.C.R. 523, - at the conclusions drawn in Kachhi Properties, as also the observations thereon in Pralhad Jaganath Jawale (supra).

5. The learned counsel for the appellant painstakingly unfolded all aspects of the matter and threw light on all pros and cons to enable me to find out what wrong in the Judgment in Kachhi Properties, was noticed by the Hon'ble Single Judge in Pralhad Jaganath Jawale. Before embarking on the examination of the questions involved, it may be useful to note that the party aggrieved by the Judgment in Kachhi Properties had questioned the same by filing a Special Leave Petition before the Supreme Court, which dismissed the same by a non-speaking order dated 1-10-2010 as had been noticed by the Hon'ble Single Judge deciding the matter in Pralhad Jaganath Jawale. It may also be useful to state that an Hon'ble Single Judge sitting at Aurangabad, in Ramesh Bodhraj Nagpal (HUF) and Anr. v. Smt. Prakashkaur Sardar Deelipsingh and Anr., reported in in 2009 (4) All MR 370 (decided way back on 26-11-2008), had also held that Section 52 of the TP Act was capable of taking care of apprehensions of the plaintiff who had sought injunction by invoking provisions of Order 39, Rule 1 / 2, after having held against the plaintiff on facts. Another Hon'ble Single Judge at Mumbai, while deciding on 28-9-2011, Rafique Barkatulla Khan v. Shahenshah Hussain Iqbal Munshi and others, reported in 2011 (12) LJ Soft 407 = 2011 (3) Mah.L.R. 732 had referred to the Judgment in Kachhi Properties but without commenting thereon, had dismissed the appeal against the order, refusing injunction to restrain the defendants from applying for sanction of development plan. The Hon'ble Judge had not noticed the Judgment in Pralhad Jaganath Jawale, which had been decided on 8-4-2011.

6. With this prelude, I would first proceed to examine the premises on which Kachhi Properties was decided. The question, which was squarely raised and dealt with in Kachhi Properties(in para 3 of the judgment) was whether in the face of provisions of Section 52 of the TP Act, a plaintiff could complain that he would suffer irreparably if an injunction to restrain creation of third party interests is not issued, and, could it be held that balance of convenience could lie in favour of granting such injunction?

7. In Kachhi Propertiesafter considering several Judgments cited at the Bar, it was observed that the noticeable argument, advanced in support of grant of injunction to restrain transfers pendente lite, namely, retention of such an injunction in Order 39, Rule 1 of CPC in spite of existence of Section 52 of the TP Act, could not justify grant of such injunctions merely because there was such a power. It was observed that there could always be cases where rule of lis pendens may not be adequate to protect the plaintiff and a temporary injunction may have to be issued, but only after making out a case of inadequacy of protection of Section 52 of the TP Act.

8. Then principally relying on the Judgments of the Supreme Court in Kishorsinh Ratansinh Jadeja v. Maruti Corporation, reported in 2009 (11) SCC 229, Sanjay Verma v. Manik Roy and others, reported in (2006) 13 SCC 608 and Usha Sinha v. Dina Ram, reported in 2008 (7) SCC 144, I had observed that all apprehensions of the plaintiffs were duly taken care of by these Judgments. Conclusions had then been summed up in para 30 of the Judgment. It may be reiterated that I had categorically stated that there could be cases where protection of Section 52 of the TP Act may be found inadequate and on such a case being made out recourse to powers under Order 39, Rule 1 of CPC could be had.

9. It is not necessary to re-state the causation in Kachhi Properties, first because it would be found in the Judgment itself and secondly because it has been discussed in Pralhad Jaganath Jawale's case and would therefore creep in the discussion to follow. In Pralhad Jaganath Jawale's case the Court concluded as under:-

“28 The conclusion drawn from the aforesaid discussion are:

(i) as far as right of impleadment of transferee pendente lite is concerned, what will bind this Court is what is held by the Apex Court in the case of Amit Kumar Shaw and Anr. (supra);

(ii) in view of the binding precedents of the Apex Court, the observation in clause (c) of paragraph No.30 that the provision of Rule 1 of Order XXXIX could be invoked only if protection provided by Section 52 is shown to be inadequate cannot bind this Court. Even the observation in first part of clause (a) of paragraph No.30 that Section 52 provides adequate protection to the parties from transfers pendente lite cannot be read as a binding precedent. In any event, in view of the law laid down by the Apex Court, it cannot be said that provisions of Section 52 of the said Act of 1882 in any manner put fetters on the powers of Civil Court conferred by Rules 1 and 2 of Order XXXIX of the said Code. As stated earlier, in a given case, while exercising discretionary powers, the Court can always come to the conclusion in peculiar facts of the given case, that in view of provisions of Section 52 of the said Act of 1882, equitable relief of temporary injunction need not be granted.”

10. Thus, the Court deciding Pralhad Jaganath Jawale's case too had come to conclusion that in a given case while exercising discretionary powers, the Court can always come to the conclusion in peculiar facts of the given case that in view of provisions of Section 52 of the TP Act, equitable relief of temporary injunction need not be granted. The difference in Kachhi Properties and Pralhad Jaganath Jawale is only if it is for the applicant to first show that protection provided by Section 52 is inadequate or it would be for the respondent to show that protection being adequate, an injunction need not be issued.

11. In my, and may be erroneous view, it would always be necessary for a party seeking an injunction from the Court to show that it would suffer irreparably, and therefore, if Section 52 of the TP Act makes the sufferance repairable, such a party would not be entitled to a relief. This is apart from the fact that it is elementary that it would always be for the party who approaches the Court to show that it is entitled to the relief claimed. This is so because when a party is seeking an ex parte ad interim injunction, the adversary, not being before the Court, would not be in a position to convey to the Court that protection of Section 52 of the TP Act is adequate.

12. This takes me to the erudite and dispassionate arguments advanced by the learned counsel for the appellant. The Judgment in Kachhi Properties is sought to be assailed as rendered per incuriam, though it was left undisturbed by the Supreme Court, albeit by a non-speaking order. While dealing with the provisions of Section 52 of the TP Act, in para 10 of the Judgment in Pralhad Jaganath Jawale, the Court observed as under:

“10. The portion highlighted and printed in italics above is the amendment made by Bombay Act XIV of 1939. It will be also material to note the other provisions of Bombay Act XIV of 1939. Section 2 of the said Act provides that the provisions of the said Amending Act shall apply to the property situated wholly or partly only in the city of Bombay from the date of publication of the notification in official gazette. It is further provided therein that the substituted Section 52 will apply to the other areas provided there is a notification issued extending applicability of the said provision to the other areas. It is not in dispute as noted in the decision in the case of Kachhi Properties (supra) that there is no notification issued making applicable the substituted Section 52 to other parts of the State of Maharashtra. Therefore, the substituted Section 52 is applicable only to the suits filed in relation to the immovable property in the city of Bombay, which consists of two revenue districts. Till a notification extending the substituted provisions to other parts of the State is issued, the other parts of the State will be still governed by unamended Section 52 of the said Act of 1882 as it is existed prior to coming into force of Bombay Act XIV of 1939. Therefore, as far as Clause (b) of paragraph No.30 of the said decision is concerned, it applies only to the suits filed relating to the immovable property in the city of Mumbai inasmuch as substituted Section 52 is not applicable to the suits in which the property in dispute is not situated in Mumbai. In the circumstances, ratio, if any, laid down by Clause (b) of paragraph No.30 of the said decision will not have any application to the suits relating to the properties situated outside the city of Mumbai. In the present case, this Court is dealing with the suits in respect of properties situated in Nasik District. Therefore, in absence of any notification issued under the Bombay Act XIV of 1939, Clause (b) of paragraph No.30 of the said decision will have no application to the present cases.

(emphasis supplied)

13. In this context, the learned counsel for the applicant submitted that after reorganization of State of Bombay, by Section 3 of the Bombay Act No.LVII of 1959, the provisions of the TP Act, as amended by the Bombay amendment in 1939, were also extended to the whole of the State of Bombay and therefore apply to the entire State. However, since the notification contemplated by Section 2 of the 1939 Act was issued to apply the amended provisions of Section 52 only to the City of Bombay, and a notification making the provisions applicable to the rest of the State is not issued, it may be safe to conclude that the amended provision, requiring a notice of pendency of suit to be registered under Section 18 of the Registration Act before protection under Section 52 of the TP Act could be availed of, would not apply to the rest of the State.

14. The Hon'ble Court deciding Pralhad Jaganath Jawale's case has observed in para 10 quoted above that therefore, clause (b) in para 3 of the Judgment in Kachhi Propertieswould not apply to suits in which property in dispute is not situated in Mumbai and in the circumstance “ratio, if any”, laid down in clause (b) of para 30 will not have application to suits relating to properties outside Mumbai. It may be useful to reproduce for ready reference clause (b) of para 30 of the Judgment in Kachhi Propertiesas under:

“(b) In Mumbai (as also elsewhere as and when amended provisions are made applicable) plaintiffs could (or rather ought to) have notices of their suits registered under Section 18 of the Indian Registration Act, in view of the amended provision of the TP Act and the Registration Act. They cannot seek to restrain adversary by an injunction by refusing to go in for registration of the lis.”

15. With utmost humility, I may say that I have not been able to understand if there is any conflict between clause (b) of para 30 of the Judgment in Kachhi Propertiesand the observations in para 10 in Pralhad Jaganath Jawale's case as regards applicability of the amended provisions of Section 52 of the TP Act.

16. In my humble view, absence of a notification extending the applicability of the amended provisions of Section 52 of the TP Act makes matters simpler for those who seek protection from transfers pendente lite, because in that case, in the rest of Maharashtra, it would not be necessary to register the lis under Section 18 of the Registration Act, and without such registration of lis, protection of Section 52 will be available.

17. In para 11 of the Judgment in Pralhad Jaganath Jawale's case, the Hon'ble Judge finds that registration of notice of pending suits under Section 18(ee) of the Registration Act is optional. The Hon'ble Judge rightly concludes in para 12 that only consequence of failure to register the notice of lis is that the constraint imposed by Section 52 will not apply, (but obviously to areas to which notification requiring registration applies). Now if a plaintiff seeks to protect himself against transfers pendente lite, he may avail of the remedy provided under Section 52, by following the procedure prescribed. Should Courts clamp injunction on the adversary at the instance of a person who does not choose to avail of a facility provided?

18. The Hon'ble Judge deciding in Pralhad Jaganath Jawale's case has then referred to the Judgment of the Supreme Court in Sanjay Verma (supra) and concluded that Section 52 does not put any restraint on a party to suit from alienating the suit property, but it provides for the legal effect of transfer pendente lite and that such pendente lite transfers are neither illegal nor void. Relying on the Judgment of the Supreme Court in T.G. Ashok Kumar v. Govindammal and Anr., reported in 2011 (1) All MR 462 (SC) the Hon'ble Judge again concluded that transfer pendent lite is not illegal or void. It may however be useful to note that the Supreme Court observed that such sale does not bind the plaintiff, which should be enough for considering the question of grant of injunction.

19. Relying on a Judgment of a Division Bench of this Court in Keshrimal Jivji Shah and Anr. v. Bank of Maharashtra and Ors., reported in MANU/MH/0344/2004 = 2004 (4) Bom.CR 842, the Hon'ble Judge observed that transfers made in violation of an injunction confers no right, title or interest in the eyes of law and is illegal. The Hon'ble Judge therefore concluded that prohibitory injunction grants protection which is not available under Section 52 of the TP Act.

20. The learned counsel for the appellant too submitted that protection granted by Section 52 of the TP Act is thus inadequate. He submitted that reliance by this Court on a Judgment of the Madras High Court {Vijayalakshmi Leather Industries v. K. Narayanan, Lalitha, AIR 2003 Madras 203} while deciding Kachhi Properties was unhelpful because Rule 102 of Order 21, which had been invoked by the Madras High Court, has been deleted by our High Court. Therefore, according to the learned counsel, it is necessary for plaintiff to seek protection by temporary injunction restraining alienations. It is true that this Court has deleted Rule 102 of Order 21, but while doing so it amended Rules 98 and 100. For ready reference, it may be useful to reproduce the original rules and Bombay amendments as under :-

22. The learned Counsel for the appellant submitted that the amendment to Rule 100 of Order XXI of the Code would not help a plaintiff since what it contemplates is determination of the question and determination would have to follow the same path as the suit. In my view, what is required to be determined is only this much, namely, the application is made by a person to whom the judgment debtor has transferred the property, and such transfer is after institution of suit in which decree was passed. This question can be determined by having a mere look at the documents by which property is transferred since it would show as to who transferred the property and on what date. Needless to mention that date of filing the suit would always be mentioned in the decree.

23. Apart from this, it may be useful to examine the consequences of an injunction restraining defendant from creating third party interests. Such an injunction would make the transfers invalid/illegal. Transferee need not be a party to the suit. So he may come in picture only when the decree holder seeks to enforce a decree in his favour. Such a transferee may then raise an obstruction, which the executing Court would order to be removed because the transfer is illegal.

24. Now let us see what happens to the case of a plaintiff who has not obtained such an injunction. If there is a decree in plaintiff's favour, the transferee pendente lite may obstruct, in which case again in view of the proviso to Rule 100 of Order 21 the executing Court would dismiss the transferee's application. I do not see as to what additional advantage that a plaintiff has, if he has secured a temporary injunction restraining transfer, unless it is sought to be suggested that such a transferee, on being shown the injunction order, would have a change of heart and not at all obstruct. One who is bound by the injunction is transferor and not the transferee, who may not at all be a party to the suit.

25. The Hon'ble Court deciding the matter in Pralhad had, in para 14 of the judgment, relied on the Judgment in Hardev Singh v. Gurmail Singh, reported in 2007(2) SCC 404, had noted that Section 52 merely prohibits a transfer. I cannot fathom as to what else an injunction restraining transfer does. Such an injunction prohibits transfers. As to such transfers not being illegal, so long as the transferee is bound by the result of the suit and the transfer itself is subject to result of the suit, it cannot matter to the parties to the suit.

26. Reverting back to the Judgment of the Division Bench of this Court in Keshrimal Jivji Shah (supra), (relied on in Pralhad), it may not be inappropriate to say that illegality of such transfer referred to by the Division Bench cannot be illegality in rem. It would only be qua the parties to the suit. Otherwise, the first beneficiary of holding such transfer illegal would be the transferor, who transfers in breach of injunction. He may simply tell the transferee that transfer is illegal and so transferee could not claim anything. As between the transferor and the transferee, the transfer would still bind the transferor, but could be avoided by the transferee, who may then seek to be compensated.

27. The Hon'ble Court deciding Pralhad seems to have found in para 19 that conclusion in Kachhi Properties that transferees pendent lite are neither required to be impleaded nor can claim impleadment was recorded in ignorance of the Judgment of the Supreme Court in Amit Kumar Shaw and Anr. v. Farida Khatoon and Anr., reported in MANU/SC/0284/2005 = AIR 2005 SC 2209. The Hon'ble Court quoted from paras 15 and 16 of the Judgment in Amit Kumar Shaw (supra) and observed in para 20 that, in view of what is held by the Apex Court in Amit Kumar Shaw the observations in Clause (a) of para 30 in Kachhi Properties that such transferee pendent lite cannot claim impleadment cannot be read as binding precedent. This comes unfortunately in the face of observations in para 16 of the Judgment in Amit Kumar Shaw (quoted in Pralhadin para 19) which reads as under:

“16. The doctrine of lis pendens applies only where the lis is pending before a Court. Further pending the suit, the transferee is not entitled as of right to be made a party to the suit, though the Court has a discretion to make him a party. But the transferee pendente lite can be added as a proper party if his interest in the subject matter of the suit is substantial and not just peripheral. A transferee pendente lite to the extent he has acquired interest from the defendant is vitally interested in the litigation, where the transfer is of the entire interest of the defendant; the latter having no more interest in the property may not properly defend the suit. He may collude with the plaintiff. Hence, though the plaintiff is under no obligation to make a lis pendens transferee a party; under Order XXII Rule 10 an alienee pendente lite may be joined as party. As already noticed, the Court has discretion in the matter which must be judicially exercised and an alienee would ordinarily be joined as a party to enable him to protect his interests. The Court has held that a transferee pendente lite of an interest in immovable property is a representative-in-interest of the party from whom he has acquired that interest. He is entitled to be impleaded in the suit or other proceedings where his predecessor-ininterest is made a party to the litigation; he is entitled to be heard in the matter on the merits of the case.“

(emphasis supplied)

28. In Sanjay Vermathe Supreme Court had specifically reversed the Judgment of the High Court permitting impleadment sought by transferees pendent lite. The apparent conflict in the two decisions may be on account of the factual context in which the Judgments were rendered. It may be useful to reproduce, for ready reference, para 4 of the Judgment in Amit Kumar Shaw as under:

“4. The short facts are as follows:

 The property in question originally belonged to Khetra Mohan Das and subsequently by way of lease and transfer; the said property ultimately came in the hands of Birendra Nath Dey and Smt. Kalyani Dey. There were troubles in between the original owner and the said Birendra Nath Dey and Smt. Kalyani Dey and as a result of that, the suit was filed. One Fakir Mohammad claimed his right, title and interest in respect of the property in question by way of adverse possession. Ultimately, both the appeals being Title Appeal No. 400 of 1989 and Title Appeal No. 7 of 1990 were allowed by a common judgment and decree dated 25.06.1992 and the suit was remanded back for rehearing before the trial Court. Being aggrieved by the said decree, Fakir Mohammad filed S.A.Nos. 631 and 632 of 1993 challenging the said judgment of the first appellate Court. On 15.12.1995, by a deed of assignment Birendra Nath Dey assigned his leasehold interest in respect of 132A, Circular Garden Reach Road, Calcutta in favour of the present appellants. Similarly, by a sale deed on 15.12.1995, Kalyani Dey sold and transferred 132 B Circular Garden Reach Road, Calcutta in favour of the present appellants. Therefore, the appellants filed applications for recording their names in the Municipal records. At that time, the appellants, for the first time, came to know about the pendency of the above two appeals. Immediately thereafter, the appellants filed the petitions praying for adding them as a party in connection with those two appeals. In this factual background, the following questions of law arise for consideration by this Court in these appeals:

"1) Whether on a combined reading of Order 1 Rule 10, Order XXII Rule 10 of the Code of Civil Procedure, 1908 and Section 52 of the Transfer of Property Act, 1882, an application for substitution by a subsequent transferee can be rejected and he be non-suited altogether?

2) Whether a decree for adverse possession is set aside in First Appeal in the year 1992 and no stay application was filed for long 12 years (till 2004) in the Second Appeal, whether a transferee interregnum from the owner/defendant, without knowledge of the second appeal, is a necessary party or whether their application for substitution can be rejected, when there is no allegation of mala fide or ill motive?

3) Whether the High Court has not committed serious error while concluding that the presence of the appellants is not necessary in order to decide the appeal and there is no merit in the application for addition of party though the application was made by the appellants for substitution of their names in place and stead of contesting defendant No. 10, who sold the suit property to the appellants?

4) Whether the High Court has not committed error by rejecting the appellants' application for substitution treating the same as addition of party and thereby rendering the appellants non-suited and remediless?“

29. In the transferees of the defendant were not at all impleaded. Those who claimed impleadment were transferees of the transferees, as in fact there were series of transactions.

30. It may be noted that in Amit Kumar Shaw impleadment was sought by persons who claimed from the rightful owners in a suit by a person who claimed the property by adverse possession. Yet even while allowing impleadment the Court reiterated that transferee pendente lite is not entitled as of right to be made a party. The Court added that a transferee pendente lite could be joined if his interest in the subject-matter of suit is substantial, when the transfer is of entire interest of the defendant; the defendant having no more interest in the property and so may not properly defend the suit.

31. The observations both, in Sanjay Verma and Amit Kumar Shaw, only show that such transferees have no right of impleadment. Thus, there is no conflict as far as the legal principle relied on by me is concerned. My object in relying on the Judgment in Sanjay Vermawas only to show that since such a transferee could not claim impleadment, he could not resist execution of decree (as has been demonstrated by referring to Rule 100 of Order 21 of CPC above). Therefore, it is an enigma as how failure to notice the Judgment in Amit Kumar Shaw would render Judgment in Kachhi Properties per incuriam.

32. In para 23 of the Judgment in Pralhad Jaganath Jawale, the Hon'ble Court observed that while deciding Kachhi Properties, this Court had not noticed Judgment of the Apex Court in Maharwal Khewaji Trust (Regd.), Faridkot v. Baldev Dass, reported in MANU/SC/0912/2004 = AIR 2005 SC 104 = 2005 (4) Bom.CR 408 followed by N. Srinivasa v. Kuttukaran Machine Tools Limited, reported in (2009) 5 SCC 182. After quoting para 10 of the Judgment in Maharwal Khewaji (supra), the Hon'ble Court deciding Pralhad Jaganath Jawale observed as under:

“24. .... Looking to the law laid down by the Apex Court, it is apparent that the Apex Court has not accepted the proposition that the principles incorporated in Section 52 of the said Act of 1882 offer adequate protection to the parties to a substantive civil suit or other proceedings. What is held by the Apex Court is that normally during the pendency of a substantive suit where rights to immovable properties are in dispute, status-quo cannot be allowed to be altered which includes creation of third party interests. In fact, the Apex Court in the case of Maharwal Khewaji Trust (supra) has observed that a defendant is required to make out a case that irreparable loss or damage will be caused to him during the pendency of the suit, if he is not allowed to alter the status-quo. It is a well settled requirement of law that while exercising the powers under Rules 1 and 2 of Order XXXIX of the said Code, the Court has to consider the issues of prima facie case, irreparable loss and balance of convenience. In the circumstances, in view of the aforesaid binding precedents of the Apex Court, the observation in clause (c) of paragraph No.30 that the provision of Rule 1 of Order XXXIX could be invoked only if protection provided by Section 52 is shown to be inadequate cannot bind this Court. Therefore, even the observation in first part of clause (a) that Section 52 provides adequate protection to the parties from transfers pendent lite cannot be read as a binding precedent. In any event, in view of the law laid down by the Apex Court, it cannot be said that provisions of Section 52 of the said Act of 1882 in any manner put fetters on the powers of Civil Court conferred by Rules 1 and 2 of Order XXXIX of the said Code. As stated earlier, in a given case, while exercising discretionary powers, the Court can always come to the conclusion in peculiar facts of the given case, that in view of provisions of Section 52 of the said Act of 1882, equitable relief of temporary injunction need not be granted.“ (emphasis supplied)

33. Since the two Judgments had not been noticed while deciding Kachhi Properties, I have gone through them with the help of the learned counsel for the appellant. The judgment in Maharwal Khewaji was followed by the Supreme Court in N. Srinivasa. It may be useful to quote para 10 from the judgment in Maharwal Khewaji and paras 20, 22 and 29 from the judgment in N. Srinivasa :-

“10. Be that as it may, Mr. Sachar is right in contending that unless and until a case of irreparable loss or damage is made out by a party to the suit, the court should not permit the nature of the property being changed which also includes alienation or transfer of the property which may lead to loss or damage being caused to the party who may ultimately succeed and may further lead to multiplicity of proceedings. In the instant case no such case of irreparable loss is made out except contending that the legal proceedings are likely to take a long time, therefore, the respondent should be permitted to put the scheduled property to better use. We do not think in the facts and circumstances of this case, the lower appellate court and the High Court were justified in permitting the respondent to change the nature of the property by putting up construction as also by permitting the alienation of the property, whatever may be the conditions on which the same is done. In the event of the appellant's claim being found baseless ultimately, it is always open to the respondent to claim damages or, in an appropriate case, the court may itself award damages for the loss suffered, if any, in this regard. Since the facts of this case do not make out any extraordinary ground for permitting the respondent to put up construction and alienate the same, we think both the courts below, namely, the lower appellate court and the High Court erred in making the impugned orders. The said orders are set aside and the order of the trial court is restored.”

(emphasis supplied)

In N. Srinivasa, the Supreme Court observed as under :

“20. In our view, the appellant, in the facts and circumstances of the case, had successfully made out a prima facie case for grant of injunction in the manner granted by the Addl. City Civil Judge, Bangalore. It is not in dispute that the appellant and the respondent had entered into an agreement for sale of the property in dispute inter alia on the terms and conditions already mentioned herein earlier.”

“22. At the same time, it must be kept in mind that it would be open to the respondent to transfer, alienate or create any third party interest in respect of the property in dispute before passing of the award by the sole arbitrator in which one of the main issues would be whether time was the essence of the contract or not.”

“29. In this connection, it is imperative to refer to a judgment of this Court in Maharwal Khewaji Trust (Regd.) v. Baldev Dass {(2004) 8 SCC 488 : AIR 2005 SC 105} which observed as follows: (SCC p.490, para 10):

(the Court then quoted from para 10)

Going by the ratio of the abovementioned decision, it is clear that the VI Addl. City Civil Judge, Bangalore, was justified in directing the parties to maintain status quo in the matter of transferring, alienating or creating any third party interest as prima facie it has been proved that the respondent was trying to sell the property in dispute to a third party, thus alienating the rights of the property in dispute, which would have caused irreparable damage to the appellant.“ (emphasis supplied)

34. In this respect, I may humbly submit that what is casually referred in N. Srinivasa as “ratio” of the Judgment in Maharwal Khewajiare in fact observations based on facts and circumstances of that case. Law of injunction is well settled. It is always for the party seeking injunction to show that it will suffer irreparably if an injunction is not issued. Then again it has to show that balance of convenience is in favour of issuance of injunction – that is, the defendant is not going to be put to greater inconvenience by grant of injunction than the inconvenience that plaintiff would suffer if injunction is refused. Can it be said that these time tested principles were consciously unsettled by the Apex Court when it observed in Maharwal Khewaji's case that “Mr. Sachar is right....?”

35. In my respectful submission, this way of reading of the Judgment of the Supreme Court amounts to being unjust to the Supreme Court. Judgments are not to be read as statutes. What the Court must be held to have accepted is that on finding the plaintiff entitled to injunction (i.e. after the plaintiff makes out a case of irreparable loss) injunction may not be refused unless the defendant makes out a case of irreparable loss.

36. It may also be noted that even in N. Srinivasa, on facts and circumstances of the case, the Supreme Court had come to conclude that the appellant had made out a prima facie case for grant of injunction. Whether a party would suffer irreparably or not and where the balance of convenience lies are purely questions of fact and there cannot be any binding precedent.

37. There could be no disagreement about fundamentals of doctrine of precedent. “Ratio” is the reason which contributes to the final result, and without which the conclusion remains unsupportable. In both prove irreparable loss on the defendant who may not even be before the Court when the plaintiff seeks ad-interim ex parte injunction? As the discussion to follow would show such an injunction, nay, even filing of suit itself, would hurt the owner/possessor of the property.

38. As observed in para 6 in Kachhi Properties, these equitable considerations came in for a scrutiny before the Supreme Court in Kishorsinh Ratansinh Jadeja (supra). The Supreme Court had observed, albeit in the facts and circumstances of the case, that if owners of properties remain restrained from developing the properties, they would suffer greater prejudice as they will be deprived of the benefit of user of their land and that the balance of convenience and inconvenience would be against grant of such an injunction.

39. It may be useful to refer to the consequences of doctrine of lis pendens observed by the Supreme Court in Vinod Seth v. Devinder Bajaj and another, reported in (2010) 8 SCC 1. The matter came to Supreme Court because the Delhi High Court had asked the plaintiff to file an undertaking on oath that in case he failed, he would pay damages quantified at Rs.25 lakhs to the defendant. The plaintiff had not sought a temporary injunction. The Supreme Court observed, in paras 19, 20, 41 and 43, as under:-

“19. We also agree with the High Court that having regard to the doctrine of lis pendens embodied in section 52 of the Transfer of Property Act, 1882 (“the TP Act”, for short),

the pendency of the suit by the appellant shackled the suit property, affected the valuable right of the second defendant to deal with the property in the manner she deems fit, and restricted her freedom to sell the property and secure a fair market price from a buyer of her choice. When a suit for specific performance is filed alleging an oral agreement without seeking any interim relief, the defendant will not even have an opportunity to seek a prima facie finding on the validity of the claim. Filing such a suit is an ingenious way of creating a cloud over the title to the suit property. Such a suit, filed in the Delhi High Court, is likely to be pending for a decade or more.

20. Even if a defendant-owner asserts that his property is not subject to any agreement and the said assertion is ultimately found to be true, his freedom to deal with the property as he likes or to realize its true market value by sale or transfer is adversely affected during the pendency of the suit. The ground reality is that no third party would deal with a property in regard to which a suit for specific performance is pending. This enables an unscrupulous plaintiff to cajole and persuade a defendant to sell/give the property on plaintiff's terms, or force the defendant to agree for some kind of settlement. It is these circumstances which persuaded the High Court to find some way to do justice, leading to the impugned direction. Having broadly agreed with the High Court in regard to the factual position and the adverse consequences of the suit, the question that remains is whether in such a situation, the High Court could have issued the impugned interim direction.”

“41. Having found that the direction of the High Court is unsustainable, let us next examine whether we can give any relief to defendants within the four corners of law. The reason for the High Court directing the plaintiff to furnish an undertaking to pay damages in the event of failure in the suit, is that Section 52 of the Transfer of Property Act would apply to the suit property and the pendency of the suit interfered with the defendant's right to enjoy or deal with the property. Section 52 of TP Act provides that during the pendency in any court of any suit in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceedings so as to affect the rights of any other party thereto under any decree or order which may be made therein except under the authority of the court and on such terms as it may impose. The said section incorporates the well-known principle of lis pendens which was enunciated in Bellamy v. Sabine {(1857) 1 De G andJ 566 : 44 ER 842}(ER p.849):

“It is, as I think, a doctrine common to the Courts both of law and equity, and rests, as I apprehend, upon this foundation - that it would plainly be impossible that any action or suit could be brought to a successful termination, if alienations pendente lite were permitted to prevail. The plaintiff would be liable in every case to be defeated by the defendant's alienating before the judgment or decree, and would be driven to commence his proceedings de novo, subject again to be defeated by the same course of proceeding.”

“43. The principle underlying section 52 of TP Act is based on justice and equity. The operation of the bar under section 52 is however subject to the power of the court to exempt the suit property from the operation of section 52 subject to such conditions it may impose. That means that the court in which the suit is pending, has the power, in appropriate cases, to permit a party to transfer the property which is the subjectmatter of the suit without being subjected to the rights of any part to the suit, by imposing such terms as it deems fit. Having regard to the facts and circumstances, we are of the view that this is a fit case where the suit property should be exempted from the operation of Section 52 of the TP Act, subject to a condition relating to reasonable security, so that the defendants will have the liberty to deal with the property in any manner they may deem fit, inspite of the pendency of the suit. “

40. Thus, mere filing of a suit, leading to auto-invocation of provision of Section 52 of the TP Act, results in serious restrictions on right to deal with the property. Therefore, the question would be whether in the face of protection provided by Section 52 of the TP Act, a party must also be held entitled to an injunction to restrain transfers pendente lite, without showing that the protection under Section 52 was inadequate ?

41. In my humble view, the proposition, in fact, does not require any digging up of authorities or “chopping little logic”, since a party seeking an injunction must first show that it would suffer irreparably if an injunction is not issued, and if Section 52 affords enough protection, the party may not be able to claim that it would suffer irreparably. Therefore, in order to seek such an injunction, such party would have to show that protection under Section 52 of the TP Act is inadequate.

42. If Section 52 of the TP Act indeed provides adequate protection, it is enigmatic as to why parties clamour for getting temporary injunction to restrain transfers pendente lite. If the litigants come to know that the relief of injunction which was secured for them at some expense and which they assiduously defended at the appellate fora, placed them in the same position as a litigant who had not taken this trouble, they would blame their lawyers for enriching at their cost by heaping upon them a cosmetic proceeding. It is like a doctor prescribing an unnecessary vaccine, which neither prevents the infection nor makes the treatment simpler as compared to treatment of a person, who has not been so vaccinated.

43. This takes me to the comments in Pralhad Jaganath Jawale on my summation in para 30 in Kachhi Properties. As to proposition (a), even the Judgment in Amit Kumar Shaw does not alter the proposition that transferee pendente lite is not required to be impleaded and cannot claim impleadment as of right. The only caveat that needs to be added is that Courts would have discretion to allow their prayer for impleadment in situations like transferor losing entire interest, not contesting the litigation or similar causes. This does not reduce the worth of protection provided by Section 52 of the Transfer of Property Act.

44. As to proposition (b), merely because the Registration Act does not make lis pendens notices to be compulsorily registrable, it does not follow that the plaintiffs may not register their suits. All that is observed in proposition (b) is that plaintiff “could (or rather ought to)” do so. Till it is shown that there is prohibition on registration of such notices, they could always be registered.

45. The Hon'ble Judge deciding Pralhad had observed in para 27 of the judgment that Clauses (d) to (f) in para 30 of the judgment in Kachhi Properties lay down mere guidelines, which cannot affect the powers of the Court conferred by Rules 1 and 2 of Order XXXIX of the Code. It may be useful to recount those guidelines in Clauses (d) to (f) in para 30 of the judgment in Kachhi Properties, which read as under :

“(d) In the face of protection provided by Section 52 of the TP Act, Courts should be cautious in examining the claims by plaintiffs of irreparable loss if injunction to restrain alienations is refused.

(e) In suits for specific performance/ right to develop against the recorded/ rightful owners, Courts may consider if an injunction would cause greater inconvenience to a rightful owner by being deprived the right to deal with his property for the sake of a claim which is yet to mature into right and which metamorphosis rests in the discretion of the Court and is not certain.

(f) Courts may consider necessity of imposing suitable conditions to protect plaintiffs' interests short of granting injunction – like seeking undertaking that no equities would be claimed, on account of sale/development of properties; effecting sales only after putting transferees to notice that their rights would be subject to suit etc. Interests of prospective purchasers would also be protected if plaintiffs in such cases register the lis, though it may be optional.”

46. There is no question of any of these Clauses affecting the powers conferred by Rules 1 and 2 of Order XXXIX of the Code. However, since while granting temporary injunction to restrain creation of third party interests pending a suit, the Courts would have to consider whether an irreparable loss would be caused to the plaintiff, if the Courts are reminded of examining implications of Section 52 of the TP Act on such claims of irreparable loss, I do not see as to how such caution would be wrong. As far as Clause (e) is concerned, one has to merely recall the observations of the Supreme Court in Vinod Seth vs. Devinder Bajaj and another{(2010) 8 SCC 1} (supra). The Supreme Court had observed that mere filing of such lis results in shackling the suit property and affects the valuable right of the defendant to deal with the property. Therefore, when a trial Court has to decide the question of irreparable loss and balance of convenience, if the Courts are reminded of the consequences of injunction issued, in my humble view, there is nothing wrong. Therefore, Clause (e) of para (30) has nothing offensive. As far as Clause (f) is concerned, it only points out to the Courts other courses of action short of clamping an injunction, which could protect the interest of the plaintiff and at the same time, not shackle the defendant from dealing with the property.

47. Even so, the learned Counsel for the appellant submitted that protection provided by Section 52 of the TP Act is no substitute for an injunction restraining the defendant from transferring the property pending hearing of the suit. For this purpose, he tendered a chart analysing the advantages and disadvantages in various situations relating to transfer of properties pending suit. It may be useful to reproduce the chart as it is in order to deal with the inferences drawn thereunder :

TABLE

1.30 To express pictorially the extent of bona fide litigation (claim or defence) vis-avis uncalled for litigation that consumes court resources, the pie chart from pp100 of the research work is excerpted below :

“CHART”

1.31 This uncalled for component of litigation (claims and defences), together with obstructive and delaying tactics by the party, who seeks to benefit from the delays, takes away the bulk – 90% - of the court resources. Resultantly, the high costs, delays and rationed time cause serious prejudice to delivery of justice in the country. If we are able to prevent this waste of resources, there will be greater justice in the country.”

50. The question is whether superior Courts laying down litigation policy, should be contributing to or encouraging the uncalled for litigation, or when such litigation far from benefiting the litigant, rather harms him by being required to spend time and money on prosecuting and defending such applications and appeals therefrom We ought to realise that as it is, the system of civil justice is not delivering the results to the common man and the persons in the wrong are reaping advantage of the system being choked by uncalled for litigation. We may not forget that all crooks and criminals proclaim their full faith in our criminal justice system only because they know that the system is unlikely to serve just deserts in the nick of time because it is already over-burdened. The question, therefore, is why Courts cannot think of avoiding mindless litigation, which serves no purpose, and, in my view, applications for injunction to restrain creation of third party interest is one such specie of this type of litigation, though I may hasten to add, as was done in Kacchi Properties, that there could always be cases where litigant may satisfy the Court of the necessity of seeking such injunction by pointing out that the protection provided by Section 52 of the TP Act is not adequate.

51. The learned Counsel for the appellant also drew my attention to the 157th report of the Law Commission wherein the Law Commission had considered various provisions of Order XXI of the Code, which recognize the principle of lis pendens. The Law Commission had observed in para 4.7 of its report as under :

“4.7 The conjoint effect of section 52 of the Transfer of Property Act and rule 102 of Order XXI, CPC as observed in the case of J.P. Shankar Singh and another vs. Pachee Bee and Others8, is as follows :

“A combined reading of Section 52 of the Transfer of Property act and Order 21, Rule 102 CPC postulates that a purchaser pendente lite does not acquire any title to the property to the detriment of the rights of other party and if such a purchaser makes any obstruction or resistance to the execution of the decree so passed, an enquiry is not contemplated under Order 21, Rule 99 or 100 CPC.”

This in fact fortifies my conclusion that Section 52 of the TP Act provides sufficient protection even at the stage of execution of decree. It may be useful also to quote the observations in para 4.10 of the report as under :

“4.10 The main objective behind the various provisions of the Code of Civil Procedure discussed herein-above is to ensure that the decree-holder should not be deprived of the fruits of the decree. With this end in view, the Civil Procedure Code provisions have been enacted which are a distinct self-contained code having independent application de hors section 52 of the Transfer of Property Act. It would run counter to the basic object of the administration of justice if the decree passed by a court is allowed to be rendered nugatory during the execution proceedings. Therefore we are of the view that the provisions of the Code of Civil Procedure contained in Sections 64, 74 and Order XXI, rule 102 serve a definite purpose and they are, as such, very much required to be retained and that the proposed amendment in section 52 of the Transfer of Property Act should not in any way have the direct or implied effect of repealing the said provisions. If no saving clause is added for the purpose, the possibility of a controversy arising in this regard cannot be ruled out, particularly when the provisions of Section 52, as already stated by us, also continue to have force until completion of the execution proceedings. We are, therefore, of the view that by way of abundant caution and in order to eliminate any controversy it would be necessary to incorporate expressly a provision to the effect that nothing in Sections 64, 74 and rule 102 of Order XXI CPC shall be affected by virtue of the proposed incorporation of the requirement of registration of the notice of suit or proceeding in section 52 of the Transfer of Property Act.”

52. The learned Counsel for the appellant also drew my attention to the judgment of the Court of Appeal in Z Ltd. v. A{(1982) 1 ALL ER 556}. The learned Counsel submitted that an injunction to restrain creation of third party interests would be akin to Mareva injunction, which operates in rem and sought to draw my attention to the observations of Lord Denning to the following effect :

“Operation in Rem –

The reason is because a Mareva injunction is a method of attaching the asset itself. It operates in rem just as the arrest of a ship does. Just as a debtor gets the ship released on giving security, so does the debtor get an aircraft released (see Allen v. Jambo Holdings Ltd. {1980} 2 All ER 502 at 505, {1980} 1 WLR 1252 at 1256) or any other asset. This concept of the Mareva injunction, as operating in rem, is in full accord with the historical and comparative survey which I described in Rasu Maritima SA v. Perusahaan Pertambangan Minyak Dan Gas Bumi Negara (Pertamina) and Government of Indonesia (as interveners) {1977} 3 All ER 324 at 331-332, {1978} QB 644 at 657-658. It operates just as the process of foreign attachment used to do in the City of London, and still does in the United States of America. It operates so as to attach any effects of the defendant, whether money or goods, to be found within the jurisdiction of the Court. Under the name of `saisie conservatoire' it is applied universally on the continent of Europe. It enables the seizure of assets so as to preserve them for the benefit of the creditor, but not to give a charge in favour of any particular creditor.”

53. Mareva injunction itself has been discussed by Lord Denning in part 4 of his celebrated work “The Due Process of Law”. This injunction cannot be equated to an injunction to restrain alienation of property granted in a suit between two parties. It may be useful to quote what Lord Denning had to say about Mareva injunction :

“The start off

On 22 May 1975 a case came before us which started off the greatest piece of judicial law reform in my time.

The facts were simple. Japanese shipowners entered into charterparties with two Greek gentlemen. The slump in shipping overtook them. They did not pay the hire. They disappeared. Their office in the Piraeus was closed. But they had funds with a bank in London. The Japanese owners feared that the two Greek gentlemen would transfer those funds to Switzerland or some other country. It could be done in a moment by a telegraphic transfer. So their solicitors issued a writ for service out of the jurisdiction – and immediately – before service – supplied to the Court here for an injunction to stop the funds being removed outside the jurisdiction. The judge refused it on the simple ground that nothing of that kind could be done in England. The Japanese shipowners immediately came to our Court and we immediately granted the injunction. I put it in these words in Nippon Yusen Kaisha v Karageorgis :

'We are told that an injunction of this kind has never been granted before. It has never been the practice of the English courts to seize assets of a defendant in advance of judgment or to restrain the disposal of them. We were told that Chapman J in chambers recently refused such an application. In this case also Donaldson J refused it. We know, of course, that the practice on the continent of Europe is different.

'It seems to me that the time has come when we should revise our practice. There is no reason why the High Court of this Court should not make an order such as is asked for here. It is warranted by section 45 of the Supreme Court of Judicature (Consolidation) Act 1925 which says that the High Court may grant a mandamus or injunction or appoint a receiver by an interlocutory order in all cases in which it appears to the court to be just or convenient so to do. It seems to me that this is just such a case. There is a strong prima facie case that the hire is owning and unpaid. If an injunction is not granted, these moneys may be removed out of the jurisdiction and the shipowners will have the greatest difficulty in recovering anything. Two days ago we granted an injunction ex parte and we should continue it'.

2 The Mareva itself

That was on 22 May 1975. The news of it soon got round. The practitioners in the Commercial Court are an expert body. The solicitors are very efficient. The Bar is first-class. But they are a small body. There was no need to wait for the case to be reported. I am quite sure that by that afternoon every commercial set of chambers in The Temple buzzed with it.

Four weeks later, on 23 June 1975, came the case which gave its name to this new procedure – Mareva v International Bulkcarriers. Shipowners let their vessel, the Mareva, to time-charterers on terms which required hire to be paid halfmonthly in advance. The charterers defaulted on the third instalment. But there was money in a London bank in their name. It had been paid to them by the Government of India as freight for the voyage: and was money which the timecharterers should use to pay the hire. They had not paid it. On this occasion Mr. Rix drew our attention to some cases in the last century – in the Court of Appeal – which showed the then view that no injunction could be granted before judgment. But we put them on one side. I said (at page 510):

'If it appears that the debt is due and owing – and there is a danger that the debtor may dispose of his assets so as to defeat it before judgment – the court has jurisdiction in a proper case to grant an interlocutory injunction so as to prevent him disposing of those assets. It seems to me that this is a proper case for the exercise of this jurisdiction'.

Those two cases ended there. The defendants never applied to discharge the injunctions. The reason was because the money was undoubtedly due: they submitted to judgment: and the funds in the Bank were used to pay it. So the procedure had proved its usefulness.”

This obviously came in the exercise of admiralty jurisdiction, which is in rem unlike the jurisdiction in personam in suits inter parties.

54. I have tried to carefully and objectively re-examine the premises on which the judgment in Kachhi Propertiesrested in view of appropriate reminder by Adv. Shri Anturkar that one tends to fall in love with one's creation, and yet, cannot find any reason to alter the view taken. In fact, at the cost of repetition, it has to be pointed out that the Hon'ble Judge deciding Pralhad's case also agreed that Section 52 of the TP Act could provide protection to the plaintiff. The observation of the Hon'ble Judge that the transfer pendente lite is not held to be illegal or void is correct, but since such transfers are ineffective against the parties to the suit, that is all what the party needs. As far as observations of the Hon'ble Judge about the judgment in Kachhi Properties having been given in ignorance of the judgment of the Supreme Court in Amit Kumar Shaw, it has humbly to be pointed out that Amit Kumar Shawdoes not hold that transferees pendente lite have a right to be impleaded. It only lays down that there could be circumstances where they ought to be treated as proper parties. The observations based on Maharwal Khewaji and N. Srinivasa have already been elaborately discussed and they come in the context of facts in those cases and cannot be read to mean that the burden of proving irreparable loss need not be discharged by the plaintiff or that initial burden to prove that an injunction would not cause irreparable loss would be on the defendant, who may not even be before the Court when an ex parte ad interim injunction is granted. And, lest we forget, this would amount to casting a negative burden.

55. Ordinarily, with these observations, the appeal could have been dismissed as untenable and as resulting in heaping upon the judicial system an unwarranted burden. However, since conflicting judgments of the Courts of record tend to create confusion in the trial Courts and result in uncertainty in law, and, since on this question, there are at least three Hon'ble Judges, who seem to have accepted that Section 52 of the TP Act affords adequate protection, which view has not found favour with the Hon'ble Judge deciding Pralhad, it may be appropriate to have the matter referred to a larger Bench rather than committing judicial indiscipline of taking a different view. This is also necessary since a Division Bench of this Court in Vasant Tatoba Hargude and others v. Dikkaya Muttaya Pujari (AIR 1980 Bombay 341) holds that judgment later in point of time would be binding in case there is a conflict in the judgments of Courts of equal strength. The observations of the Division Bench in para (13) of the judgment read thus

“13. The contention of Mr. Rane as to the competency of the later Bench of three Judges to overrule the ratio of the earlier Bench of equal number of Judges need not detain us. In the event of there being clear conflict, the decision of such later Bench would be binding on us. Secondly, the decision in Anand Nivas case (AIR 1965 SC 414) is based not so much on the incidence of statutory tenancy as on the interpretation of Sections 12 to 15 of the Rent Act. All the Judges were unanimous on statutory tenant having no estate or property in the tenancy. Even while expressing dissent as to the extent and nature of any statutory tenant's “interest” in the tenancy. Sarkar, J. proceeded on the hypothesis that the power of transfer of even such “interest” required authority of law. The determination of true scope and import of Section 13(1)(e) and consequently of Sections 12, 14 and 15 appear to have been assumed to be the main point in controversy in that case and the decision on the first point indicating conflict on a narrow margin appears to have been treated as mere observations. This may have prompted the later Bench to dispense with any need to refer the point to a larger Bench.”

(emphasis supplied)

This leads to a piquant situation as after judgment in Pralhad, another Hon'ble Judge deciding Rafique Barkatulla Khan vs. Shahenshah, reported at 2011 (3) Mah. LR 732, which judgment is later in point of time, has followed Kachhi Properties.

56. With utmost humility at my command, I would submit that this observation of the Division Bench does not appear to be preceded by any argument or discussion on the question on which this one line pronouncement has come from the Division Bench. In my view, what the Division Bench sought to convey is that earlier judgment as explained by later judgment would bind. Reading the observation to universally mean that later judgment would bind would hit at the very root of the doctrine of precedent, which is based on the principle that judgment rendered earlier in point of time would bind successive Courts. Therefore, there is no question of a judgment later in point of time having a greater binding force over a judgment given earlier and, therefore, this stray sentence, which has also resulted in a considerable turbulence for the Courts below, would require appropriate judicial consideration. The observation would have to be read to mean that the a subsequent judgment may have to be preferred to an earlier judgment if the judgment later in point of time considers and explains the earlier judgment. The latter judgment upsetting the law laid down by the earlier Bench of same strength cannot be binding because it would come in the breach of judicial discipline, which requires that such Court must refer the matter to a larger Bench. It is not necessary, in fact, to cite any authority for such proposition. However, it may be appropriate to quote para (100) from the judgment of the Supreme Court in State of U.P. and others vs. Jeet S. Bisht and another {(2007) 6 SCC 586}, which reads thus :

“100. For the views being taken herein, I regret to express my inability to agree with Brother Katju, J. in regard to the criticism of various orders passed in this case itself by other Benches. I am of the opinion that it is wholly inappropriate to do so. One Bench of this Court, it is trite, does not sit in appeal over the other Bench particularly when it is a coordinate Bench. It is equally inappropriate for us to express total disagreement in the same matter as also in similar matters with the directions and observations made by the larger Bench. Doctrine of judicial restraint, in my opinion, applies even in this realm. We should not forget other doctrines, which are equally developed viz. Judicial Discipline and respect for the Brother Judges.”

57. It would, therefore, be necessary to refer the following questions for decision to a Division Bench :

(I) Does Section 52 of the Transfer of Property Act provide adequate protection to the parties from transfers pendente lite since such transferees are not required to be, or entitled as of right to be, impleaded as parties to the suit and cannot resist execution proceedings in view of provisions of Order XXI Rule 100 of the Code as amended by this Court ?

(II) Would plaintiffs' registering notices of their suits under Section 18 of the Indian Registration Act (though such registration may not be compulsory) not secure for plaintiffs more than what an injunction could secure since transferees, who purchase property, pendente lite in spite of such registration would be deemed to have notice of pendency of the lis and could not claim to be transferees without notice And, would such registration not be preferable to clamping an injunction on adversary ?

(III) Since a plaintiff seeking a temporary injunction is required to show that he would suffer irreparably if temporary injunction is not issued, would it be inappropriate to expect such plaintiff to show that the provisions of Section 52 of the Transfer of Property Act do not afford adequate protection before an injunction to restrain transfer pendente lite is issued ?

(IV) Would it be appropriate, in cases of claims for temporary injunction to restrain transfers pendente lite, to consider imposition of conditions short of granting injunction, which should protect the plaintiff's interest, like, seeking an undertaking that no equities would be claimed on account of sale or development of properties; effecting sales only after putting transferees to notice that their rights would be subject to the pending suit, or requiring the party to inform the Court promptly of creation of every such interest ?

(V) Whether the observation in para (13) of the judgment in Vasant Tatoba Hargude and others v. Dikkaya Muttaya Pujari (AIR 1980 Bombay 341) that in the event of there being conflict, the decision of later Bench would bind only lays down that judgment later in point of time as explaining the earlier judgment would bind ?

Let the Registry place the matter before the Hon'ble the Chief Justice seeking appropriate directions.