2012 (8) TMI 1111 - SC - Indian Laws

Supreme Court affirms Delhi High Court rulings on impleadment, receiver appointment, and injunction violations.

The Supreme Court upheld the Delhi High Court's decisions to dismiss the appellants' impleadment and appoint a receiver for the suit property. The ... Whether the learned Single Judge and the Division Bench of the High Court committed an error by dismissing the appellants’ application for impleadment as parties? - Held that:- Clandestine nature of the transactions entered into between respondent No.2 and the appellants on the one hand and the appellants and Bhagwati Developers on the other would give rise to strong presumption that if a receiver is not appointed, further attempts would be made to alienate the property in similar fashion. Therefore, we do not find any valid ground much less justification to interfere with the impugned order or the one passed by the learned Single Judge of the Delhi High Court. We do not consider it necessary to advert to the documents filed by respondent No.1 before this Court for the first time and the additional affidavit filed by Smt. Bhanwari Devi Lodha on behalf of Bhagwati Developers. In the result, the appeals are dismissed. For their contumacious conduct of suppressing facts from the Calcutta High Court and thereby prolonging the litigation, the appellants and Bhagwati Developers are saddled with cost of ₹ 5 lakhs each. The amount of cost shall be deposited by them with the Supreme Court Legal Services Committee within a period of three months. Issues Involved:1. Whether the appellants who purchased the suit property in violation of an injunction are entitled to be impleaded as parties to the suit.2. Whether the Delhi High Court was justified in appointing a receiver to take possession of the suit property despite a prior receiver appointment by the Calcutta High Court.Detailed Analysis:1. Impleadment of Appellants:The appellants purchased the suit property during the pendency of a suit for specific performance filed by respondent No.1. The agreements for sale and sale deeds executed by respondent No.2 in favor of the appellants were in violation of an injunction order dated 18.2.1993, which restrained respondent No.2 from alienating the property or creating third-party interests. The appellants argued that they were bona fide purchasers and unaware of the pending litigation. However, the court found this claim unconvincing due to the timing of transactions and the appellants' involvement in subsequent litigation, including Suit No.161/1999 filed by respondent No.2, which mentioned the pending suit. The court emphasized that transactions executed in violation of the injunction lacked legal sanctity and did not confer any rights on the appellants or Bhagwati Developers. The court upheld the rejection of the appellants' application for impleadment, noting their delayed application and lack of bona fides.2. Appointment of Receiver:The Delhi High Court appointed a receiver to manage the suit property, citing clandestine transactions and the risk of further alienation. The appellants and Bhagwati Developers argued that the Calcutta High Court had already appointed a receiver, invoking the doctrine of comity of jurisdictions. However, the court noted that the Delhi High Court was already seized of the matter and had issued injunction orders before the Calcutta High Court's involvement. The Calcutta High Court, upon being apprised of the facts, acknowledged the precedence of the Delhi High Court's orders. The court found that appointing a receiver was justified to prevent further clandestine transactions and protect the suit property.Conclusion:The Supreme Court dismissed the appeals, upholding the Delhi High Court's decisions to reject the appellants' impleadment and appoint a receiver. The court imposed costs on the appellants and Bhagwati Developers for their contumacious conduct and suppression of facts. The court requested the Delhi High Court to expedite the pending suit's disposal.