2021 (2) TMI 926 - HC - Insolvency and Bankruptcy

Seeking interim order of attachment - seeking order of injunction against the defendant - HELD THAT - In the facts of the present case, the plaintiff has claimed a decree for a sum in excess of ₹ 81 crores on the basis of an agreement under which, the defendant was to construct and deliver flats to the plaintiff. The ultimate agreement between the parties, had obliged the defendant to construct and make over unit Nos. 12W, 13W and 14W located on the 12th, 13th and 14th floor on the proposed building Wellside Camac to be constructed by the defendant upon the plaintiff paying the agreed consideration in respect thereof. Admittedly, the plaintiff had paid a sum of ₹ 14,06,70,000/- to the defendant. Apparently, the parties had fallen out of the contract. The parties have claimed differently with regard to the termination of the contract. According to the plaintiff, it has originally terminated the contract and the defendant is obliged to refund the entirety of the consideration advanced along with interest at the rate of 18 per cent per annum. According to the defendant, the termination effected by the plaintiff has been premature therefore entitling the defendant to deduct amounts stipulated in the contract. According to the defendant, it has to pay a sum of ₹ 12,81,22,349/- to the plaintiff after deduction as claimed. The plaintiff has expressed its unwillingness to accept such sum in full and final settlement of its claim. This stand of the respective parties has raised triable issues. The parties to the instant suit have raised triable issues. However, it can be garnered out of the facts of the present case at this stage that, the defendant is liable to pay the plaintiff. The quantum of liability has to be decided - Till such time such quantum of liability is decided and the defendant pays the same, and since, the contract that the parties had entered into related to units Nos. 12W, 13W and 14W on the 12th, 13th and 14th floor of the proposed building, it would be appropriate to grant an order of injunction restraining the defendant from creating any third party rights over and in respect of such units without the leave of the Court. Application disposed off.

Summary

Issues:
Interim order of attachment before judgment and order of injunction sought by plaintiff against defendant.

Analysis:
1. The plaintiff sought an interim order of attachment before judgment and an injunction against the defendant in a money claim suit. The plaintiff claimed that the defendant failed to fulfill obligations under an agreement to construct and sell three flats, resulting in the plaintiff terminating the contract and demanding a refund of the principal amount with interest. The defendant contended that the plaintiff prematurely terminated the contract, entitling the defendant to deduct a specified amount. The plaintiff approached the National Company Law Tribunal, which disposed of the matter with a tendered sum lower than the plaintiff's claim, leading to the current claim of over ?81 crores against the defendant.

2. The plaintiff limited the application to a prayer for injunction only, foregoing the attachment before judgment. The plaintiff's senior advocate cited a Calcutta High Court case to support the entitlement to an injunction.

3. The defendant's senior advocate argued against the need for attachment before judgment, referencing a Supreme Court case. The defendant claimed that the plaintiff's termination of the contract was premature, justifying the deduction as per the contract terms. The defendant offered a refund, which the plaintiff did not accept, leading to the current dispute.

4. The court referenced previous cases to analyze the situation. The court highlighted that the plaintiff's claim of over ?81 crores based on the agreement for construction and delivery of flats raised triable issues. It was noted that the defendant would be liable to pay the plaintiff, pending determination of the quantum of liability.

5. Considering the circumstances and the unresolved issues between the parties, the court granted an order of injunction to prevent the defendant from creating third-party rights over the specified units until the determination of the defendant's liability and payment to the plaintiff.

6. The court disposed of the application accordingly, emphasizing the need to maintain the status quo regarding the disputed units until the resolution of the liability issue between the plaintiff and the defendant.