M/s. Rizvi Land Development Pvt. Ltd. v. Louis Thomas Jacinto & Ors.

Judgment

1. The Plaintiffs have applied for an injunction against the Defenda nt s restraining them from transferring, or dealing with the suit property or carrying out development work on the suit property in this Notice of Motion.

2. The suit is filed for a declaration that the Conveyance Deed between Defenda nt No.1 to 26 and Defenda n t No.27, Exhibit- H, to the plaint is fraudulent and for conseque n tial reliefs against these parties based upon the said transfer.

The Plaintiffs are stated to have entered into certain 2 development agreement s with various groups of Defendant s, between Defenda nt s 1 to 26. These are marked Exhibit- B1 to B6 , in the plaint. These document s are identical. They are on stamp papers dated 8th Ju ne, 2006 and in respect of only one set of Defenda nt s dated 3rd August, 2006. These stamp papers are issued in the name of Plaintiffs. They are notarized , but not registered docume nt s. Under these docume nt s Defenda nt s 1 to 26 have sought to transfer their right, title and interest in the suit premises at village Kolhe- Kalyan, Kalina, Taluka Andheri bearing several CTS number s mentioned therein on “as is, where is” basis for certain amou nt s of consideration mentioned therein. The consideration is shown to be paid by cash / D e m a n d Draft as reflected in the receipt clauses.

4. A Deed of Conveyance is registered between Defendan t s 1 to 16 and the Plaintiffs on 18 th Ju ne, 2007 and registered on that date. This Deed of Conveyance, though stated to be conveying the properties of these Defenda n t s is actually executed by their Constit uted Attorney. The Constituted Attorney is a represent ative of the Plaintiffs' Company and appears to be a family member of one of the Directors of the Plaintiffs' Compa ny. The Conveyance is not witnessed as mand atorily required. The receipt clause in the Conveyance do not show the passing of any consideration. 3

5. To the Conveyance is annexed several General Powers of Attorney executed by Defenda nt s 1 to 26 in favour of the said represent a tive of the Company who is shown to be a family member of one of the Directors of the Company as their Constituted Attorney.

6. A look at these Powers of Attorney is required. They are undated. The stamp papers are issued in the name of the Plaintiffs who are not parties to the Powers of Attorney and not in the names of those Defenda n t s who have given the power thereu n der. Several Powers of Attorney are thu mb impressed. The dates in the Execution Clauses are not mentioned. Some Powers of Attorney bear certain photograp h s . The photograp h s are not identified. One Power of Attorney bears the photograp h s of various member s of the family of one Peerzada. The Powers of Attorney are notarized, an effort which is not required in law. Though they bear the stamp of the Registration Office on their last page, stamp only shows the serial number of Registration of the Conveyance, since the Powers of Attorney are mere annexu res to the Conveyance. The most striking fact is that the stamp papers of the Powers of Attorney show the date of purch ase s similar to those in the Defenda nt s' Development Agreement. Hence, all except one Powers of 4 Attorney are dated 8 th Ju ne, 2006; all except Development Agreements are also dated 8th Ju ne, 2006. The serial number s of issue of these Development Agreement s and the Powers of Attorney are Nos. 9012, 9013, 9014, 9015, 9016, 9017, 9018, 9019,9020 and 9021 mixed- up and used for any of the groups of Defendant s.

7. One Power of Attorney and one Development Agreement of one group of Defendant s from amongst Defendant s 1 to 26 are both dated 3 rd August, 2006. These two docume n t s are on stamp papers bearing number s 5713 and 5714.

8. This leads to an unmista k a ble conclusion that the Powers of Attorney and the Development Agreement s are executed on stamp papers purch a sed by the Plaintiffs on the same day and are executed on the same day. Though the Plaintiffs are a party to the Development Agreement s, they are not parties to the Powers of Attorney. The stamp paper of the Powers of Attorney are, therefore, not purch ase d by the Executent s as specifically required under Section 34 of the Bombay Stamp Act.

9. The Powers of Attorney are not executed in favour of a person of the confidence of the Defenda nt s 1 to 26, who would represe nt the interest of Defendan t s 1 to 26. They are 5 executed in favour of a Represent ative of the Plaintiffs, who is expected to see only the interest of the Plaintiffs. After getting the Powers of Attorney executed on the same day as the Development Agreements, the Plaintiffs have sought to ignore the interests, claims or rights of Defendan t s 1 to 26 who are the owners of the suit property. By putting their own represent ative as the represent a tive of Defenda nt s 1 to 26 in the name of he being their Constituted Attorney, the Plaintiffs have got the Conveyance executed not by Defenda nt s 1 to 26 or their Represent ative, but by the Plaintiff's own Represent ative. No consideration is shown to be paid by the Plaintiffs to Defenda nt s 1 to 26 at the time of execution of the Conveyance. The receipt clause in the Conveyance has various blanks. The execution clause in the Conveyance shows it being signed by Abis Akhtar Rizvi and Sakib Rizvi dealing with the entire immovable property of Defenda nt s 1 to 26.

10. The contention on behalf of the Plaintiffs that since the date of Conveyance has been registered and stamp duty is paid thereon, the Power of Attorney need not be registered and no stamp duty is required to be paid thereon aside from the fixed stamp duty of Rs.100 / - is entirely misconceived. It is based upon such Powers of Attorney that the Plaintiffs have had no barrier in dealing with the land of Defenda nt s 1 6 to 26 without any obstruction from these Defendan t s and without heeding their claims and rights. The very Power purportedly given by Defenda nt s 1 to 26 is void and non est. It grants no right upon the Constituted Attorney to deal with the property as an Agent of Defendan t s 1 to 26. The Powers of Attorney cannot be looked into at all to grant the Plaintiffs any rights thereu n der.

11. The argume n t s on behalf of the Plaintiffs that these Powers of Attorney are irrevocable as they are Agencies coupled with interest and hence the Plaintiffs rights under Section 202 of the Indian Contract Act also cannot apply to a case such as this, when the docume nt s are wanting in all material requiremen t s of law and are mere annex ures to a Conveyance made by one arm of the Plaintiffs to another arm of the Plaintiffs.

12. The Plaintiffs have sought to overreach the law. No rights, let alone equitable rights of injunction in the interim application can be granted.

13. From the aforesaid trans actions it can be seen that the Constit uted Attorney stated to be of Defenda nt s 1 to 26 would, on his own account, be developing the property of the Defenda nt s without the consent of the defenda nt s. The 7 Defenda nt s as the principals would then be entitled to repudiate such a trans action under section 215 of the Indian Contract Act. Similarly if the attorney were to exceed authority in developing the property without the knowledge of Defenda nt s 1 to 26. Defenda nt s 1 to 26 would not be bound by such access of authority under section 227 and 228 of the Indian Contract Act.

14. In fact it can be seen from the total lack of bonafides in this case that the prime duty of the Agent under section 211 of the Indian Contract Act in acting as per the directions of the principals would be given a complete go-by. The very nature of the Power of Attorney shows and suggests that the Constit uted Attorney of Defenda nt s 1 to 26 shown in the Powers of Attorney is actually a represent a tive of the Plaintiff Company and would not represent the interest of the Defenda nt s 1 to 26.

15. The Defenda nt s 1 to 26 have entered into a Conveyance of their property with Defenda nt No.27. The Conveyance is registered and adequa tely stamped. It shows adequate consideration given to the Defenda nt s. The Advocate for Defenda nt s 1 to 26 states that, whereas only the token consideration of Rs.24 lakhs was given to them by the Plaintiffs for the property which was valued at Rs.75 lakhs, 8 and no consideration was given to them after the execution of the Development Agreement and at the time of the execution of the Conveyance, Defenda nt No.27 have paid Defenda nt s 1 to 26 the proper market price of their property which is valued at Rs.75 lakhs. The Plaintiffs have sought a declaration that, that transfer is fraudulent, whereas it is seen that the Plaintiffs' trans action itself is fraud ulent. The Plaintiffs cannot be granted the relief of injunction sought.

16. The Notice of Motion is dismissed with costs as stated hereinafter.

17. The Advocate for Defendan t s 1 to 26 makes a statemen t before the Court and has shown the statemen t of the Defenda nt s in paragrap h 49 (j) of their affidavit in reply that Defenda nt s 1 to 26 are ready and willing to deposit the entire amoun t received by them in this Court.

18. Defenda nt s 1 to 26 shall deposit the amou nt s received by them from the Plaintiffs in this Court to credit to this Suit.

19. The Plaintiffs shall be entitled to apply for the withdrawal of the said amou nt upon accepta nce by them that their trans action with Defendan t s 1 to 26 has ended. 9

20. If such an application is made the Prothonotary and Senior Master (O.S.) of this Court shall deduct Rs.10,000 / - payable in respect of each group of Defenda nt s, who have received amoun t s the aforesaid Development Agreements Exhibits- B1 to B6 as costs of this Notice of Motion.

21. The Prothonotary and Senior Master (O.S.) of this Court shall retur n the remaining amou nt to the Plaintiffs upon the Plaintiffs, applying for withdrawal / di s mi ss al of the Suit.

22. Upon such payment being applied for and made, the Suit shall stand dismissed.

23. The amoun t s of costs deducted by the Prothonotary and Senior Master shall be credited / handed over to the High Court Legal Services Authority.

24. If the amou nt is not withdrawn within three month s of the deposit, it shall be invested in any Nationalised Bank pending the Suit.