- (1.) Leave granted.
(2.) This appeal has been filed at the instance of the appellant by special leave against the judgment and final order of the High Court of Karnataka at Bangalore in M.F.A No. 12014/2006 (AA), dated 16th of April 2007, setting aside the order dated 23rd of September, 2006 passed by the VI Additional City Civil Judge, Bangalore, and vacating the order of status quo granted on condition that the respondent shall deposit a sum of Rs. 2,50,000,00/- [Rupees two crores fifty lacs] within the time specified in the impugned order.
(3.) The facts leading to the filing of this appeal may be summarized as follows: The respondent became the owner of Plot No. 19-A, II Phase, Industrial Area, (carved Survey No. 40 and 41, Chokkasandra Village, Yeshwanthpur Hobli, Bangalore North Taluk), measuring about 10568 square meters (hereinafter referred to as the 'property in dispute ) by a sale-deed dated 11th of November 2001 executed by the Karnataka Industrial Area Development Board. The appellant and the respondent entered into an agreement for sale of the property in dispute on 21st of December 2005 for a sum of Rs. 6,99,04,079/- in which an advance of Rs. 2,00,00,250/- (Two Crore Two Hundred Fifty Only) was paid to the respondent at the time of executing the agreement for sale. One of the stipulation in the agreement for sale was that the balance amount of the consideration money shall be paid to the respondent at the time of registration of the Sale Deed which shall be executed within sixty days from the date of execution of the agreement for sale. The agreement for sale specifically mentioned that it was the obligation of the respondent to keep the title good till the execution and registration of the sale deed and further to keep the property in dispute free from all encumbrances or charges. It was also agreed that the respondent shall pay all rates, taxes and cesses in regard to the property in dispute upto the date of sale and all dues prior to the Sale Deed. It was further agreed that in case of dispute, the same should be referred to Arbitration under the provisions of Arbitration and Conciliation Act, 1996 (in short the 'Act ). The respondent borrowed funds from KSIIDC and various other financial institutions for installation of various kinds of machineries in the factory thereby created equitable mortgage by way of deposit of title deeds with various financial institutions. It was clearly understood that at the time of registration of the sale deed, vacant and peaceful physical possession of property in dispute would be delivered by the respondent to the appellant and that the respondent would be bound to remove all plants and machineries from their factory in order to deliver possession to the appellant after clearing all its dues to the various financial institutions and keep the title deed ready. For the purpose of execution of the sale deed, the appellant started doubting its bona-fide and, therefore, by a letter/notice dated 18th of February 2006 called upon the respondent to execute the sale deed so that the vacant possession of the property in dispute could be delivered to him. On 20th of February 2006, the appellant received a letter from the respondent asking him to complete the sale transaction on the very next day i.e. on 21st of February 2006. After the receipt of the letter mentioned above, the appellant approached the respondent and requested the respondent to perform their part of the obligation. The respondent assured the appellant that they would require some more time to remove the machineries from the property in dispute as they were in large numbers and very huge in size. They also informed the appellant that they required some more time to make alternative arrangement of other premises where their plants and machineries could be kept as they were very expensive and involved a lot of money. As the appellant had already paid an amount of Rs. 2,00,00,250/- to the respondent, he had no choice but to keep quiet. The appellant, however, having believed the version of the respondent that they had difficulty in shifting all the machineries within a short notice kept quiet till he realized that the intention of the respondent was not honest as he found that the respondent was trying to sell the property in dispute to some other party at a much higher price. Having found that the respondent was not interested to execute the sale deed as agreed upon, he approached the respondent on 21st of June, 2006 to execute the sale deed, when he also intimated the respondent that he was ready and willing to perform his part of the contract to execute the sale deed, the respondent refused to perform its part of the contract and informed that they would not execute the sale deed until and unless the appellant agreed to pay a higher sale consideration over and above what was agreed to between the parties. Having found that the respondent was trying to sell the property in dispute to a third party at a higher price, the appellant filed an application under Section 9 of the Act on 23rd of June 2006, before the City Civil Judge, Bangalore, for injunction restraining the respondent from alienating, altering or creating any third party interest in respect of the property in dispute. With the application, the appellant also filed an application under Order 39 Rule 1 and 2 read with Section 151 CPC for temporary injunction restraining the respondent from transferring, alienating or creating any third party interest in the same.;