MRS. VASUNDHARA DINANATH GAWADE AND OTHERSversusMR. MANILAL KHIMJI LALAN AND OTHERS

      IN THE HIGH COURT OF JUDICATURE AT BOMBAY
             CIVIL APPELLATE JURISDICTION

               INTERIM APPLICATION NO.3646 OF 2026
                              IN
                APPEAL FROM ORDER NO.405 OF 2026

1. Vasundhara Dinanath Gawade                 ]
2. Prashant Dinanath Gawade                   ]
3. Harshad Dinanath Gawade                    ]
4. Axis Housing Private Ltd., Goregaon        ] .. Applicants-
                                              Appellants
                       Versus
1. Manilal Khimji Lalan                       ]
2. Shobha Waman Rawool                        ]
3. Manohar Waman Rawool                       ]
4. Mira-Bhayandar Municipal Corporation ] .. Respondents



Mr. Girish Godbole, Senior Advocate, i/by Ms. Pooja Thakkar,
Advocate for the Applicants-Appellants.

Mr. Gaurav Joshi, Senior Advocate (through V.C.) with Mr. Amrut
Joshi, Mr. Hitesh P. Mishra, Mr. Ashish P., i/by Mr. Hitesh Mishra,
Advocates for Respondent No.1.

                                CORAM : GAUTAM A. ANKHAD, J.

                                DATE      : 22ND MAY 2026
                                            [ VACATION COURT ]

P.C. :

1.       The present Interim Application seeks a stay of the impugned

order dated 10th March 2026 in Exhibit-5 passed by the trial Court in


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Special Civil Suit No.555 of 2023. The impugned order, annexed at

page 307 of the paper-book, grants injunctions in the following

terms:-

           “1.     The application is partly allowed.

             2.    The defendant nos.1 to 6 are restrained from creating any
                   third party interest in the suit property and carrying out any
                   construction activities upon the suit property. Further
                   restrained from seeking permission or sanction to any
                   Government Authority in respect of development of the suit
                   property and disturbing the peaceful possession of the
                   plaintiff over the suit property.

             3.    The ad-interim mandatory injunction claimed by the
                   plaintiff is hereby rejected.

             4.    The defendant no.7 is restrained from granting any
                   approval/sanction or layout plan of the defendant nos.1 to 6
                   in respect of construction of any building or the suit
                   property.”


Brief facts:

2.       The suit property originally belonged to one Waman Rawool.

In or about 1992-93, a Court Receiver was appointed for a portion of

the suit property in proceedings between Waman Rawool and

Saraswat Co-operative Bank Limited. Despite that, on 1st March

1994, Waman Rawool purported to execute a Development

Agreement along with a Power of Attorney in favour of Respondent

no.1/original Plaintiff for a consideration of Rs.25 lakhs (“1994

Development Agreement”). The transaction was on an ‘as is where is’



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basis. According to Respondent no.1, the said Development

Agreement bears the signature of one Dinanath Gawade.


3.       On 25th September 2009, the suit property was released from

the Court Receiver. Waman Rawool executed a Will on 6 th February

2004 bequeathing the suit property to his nephew, Dinanath Gawade.

Appellant nos. 1 to 3 are the legal heirs of Dinanath Gawade. Waman

Rawool died on 11th December 2005.

4.       Between 2007 and 2010, Respondent no.1 issued three public

notices asserting rights in respect of the suit property. Thereafter,

Respondent no.1 instituted Special Civil Suit no. 460 of 2010

(“2010 suit” or “first suit”) before the learned Civil Judge, Senior

Division, Thane, inter alia, seeking declarations of ownership,

specific performance of the 1994 Development Agreement,

cancellation of Waman Rawool’s Will dated 6th February 2004 and

permanent injunctions against the Appellants. For convenience, the

reliefs in the 2010 suit are quoted:

       “(a) That the Plaintiff may be declared as the lawful owner in
            possession of the suit land.

         (b) That the Defendants jointly and severally may be directed to
             execute Sale Deed of the suit land on the name of the Plaintiff.

       (bb) The Defendants jointly and each severally ordered, decreed
            and directed to deliver possession of the suit land, more



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               particularly described in para no.1 of the plaint to the Plaintiff.

         (c) That Defendants in case deny to execute Sale Deed of the suit
             land, this Hon’ble Court may appoint Court Commissioner and
             direct Court Commissioner to execute Sale Deed of the suit
             land on the name of Plaintiff.

       (cc) If for any reasons whatsoever, this Hon’ble Court comes to a
            conclusion that the Plaintiff was not in possession of the suit
            land, this Hon’ble Court may by an appropriate order and
            decree issue directions to the Defendants to quit, vacate,
            handover and deliver vacant and physical possession of the
            suit land and very part thereof to the Plaintiff.

         (d) That Defendant nos.1 and 2 in case deny to execute Sale Deed
             of the suit land, this Hon’ble Court may appoint Court
             Commissioner and direct Court Commissioner to execute Sale
             Deed of the suit land on the name of the Plaintiff.

         (e) Court Receiver under Order 40 Rule 1 of the CPC, 1908 be
             appointed to take custody of the suit land.

         (f) Defendant nos.1 to 4 may be restrained from creating third
             party interest of any in nature of the suit land.

         (g) The Defendant nos.1 to 4, their agents, Manager, servants,
             legal heirs etc. may be permanently restrained from taking over
             possession or disturbing possession of the suit land of the
             Plaintiff, without following due process of law.

         (h) Interim relief in terms of prayer clauses (e) and (f) hereof be
             granted.

         (i) Will dated 6th February 2004 may be declared as null and void
             having no effect on title of Plaintiff on suit land.

         (j) Defendant nos.3 and 4 may be directed as not to create third-
             party interest upon suit land by taking undue advantage of Will
             dated 6th February 2004.”

5.       Significantly, in paragraph 1 of the original plaint of the 2010

suit, Respondent no.1 has pleaded that he is in lawful possession of


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the suit property. The ad-interim reliefs sought in this first suit were

rejected by order dated 2nd August 2010. The said order was not

challenged. On 5th December 2011 the trial Court observed that the

interim application would be heard along with the final hearing of the

suit. It may be noted that the plaint was amended only on 2 nd August

2019 seeking possession of the suit property, by incorporating

pleadings in paragraphs 10(a) and 10(b) and corresponding prayer

clauses (bb) and (cc).


6.       On 15th July 2011, a registered Development Agreement

coupled with an Irrevocable Power of Attorney was executed by

Dinanath Gawade and Appellant no.3, in favour of Appellant no.4

(“2011        Development   Agreement”).   Several   other   registered

instruments were also executed. Dinanath Gawade died on 1st January

2021.


7.       Nearly twelve years after the first Suit, on 25 th November

2023, Respondent no.1 instituted the present suit being Special Civil

Suit No. 555 of 2023 seeking cancellation of the 2011 Development

Agreement and consequential reliefs, including injunctions. On 12 th

December 2023, Respondent no.1 sought ad-interim reliefs, but the

same were not granted considering the duration from the cause of


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action till the filing of the suit. The trial Court issued notice to the

Appellants and posted the matter to a later date. On 22 nd December

2023, the Appellants filed their written statements and reply to the

injunction application (Exhibit-5). By the impugned order dated 10 th

March 2026, the trial Court granted the aforesaid injunctions quoted

in paragraph no.1 above.

Submissions:

8.       Mr. Godbole, learned senior counsel appearing for the

Appellants submits that the impugned order is ex facie unsustainable

inasmuch as the alleged 1994 document is admittedly unregistered

and inadequately stamped. It does not create any enforceable right,

title or interest in favour of Respondent no.1. Thus the trial Court

erred in relying upon Section 48 of the Transfer of Property Act,

1882. Respondent no.1 never acted upon the alleged unregistered

1994 Development Agreement. Respondent no.1 also failed to secure

any protection in its favour either in the first suit or this suit, until

passing of the impugned order. He submits that substantive and

valuable rights have accrued in favour of the Appellants under the

registered Development Agreement of 2011. The impugned order

itself records that substantial construction activity has already

commenced, statutory permissions have been obtained and


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considerable investments have been made. In these circumstances,

injunction could not have been granted and its continuation will

cause irreparable injury to the Appellants and bring the entire

development project to a standstill. Without prejudice to the rights

and contentions of the Appellants, Mr. Godbole submits that the

Appellants are willing to secure two flats valued at approximately

Rs.2.35 crores in favour of Respondent no.1, particularly when the

consideration allegedly paid under the alleged 1994 Development

Agreement is Rs.25 lakhs.


9.       Mr. Gaurav Joshi, learned senior counsel appearing for

Respondent no.1, submits Dinanath Gawade and the Appellants were

fully aware of the rights asserted by Respondent no.1 as well as the

pendency of the 2010 suit and yet proceeded to execute the 2011

Development Agreement in favour of Appellant no. 4. Respondent

no.1 had performed his obligations under the 1994 Development

Agreement by paying consideration of Rs.25 lakhs to Waman

Rawool. The 1994 agreement contains a specific covenant restraining

Waman Rawool from creating third-party rights in respect of the suit

property and that the Gawade family had full knowledge thereof. It is

contended that the pendency of the 2010 suit is deliberately




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suppressed in the 2011 Development Agreement and that several

incorrect statements were incorporated therein. Hence the Appellants

are not bona fide purchasers for valuable consideration.

10.      Mr. Joshi further submits that the cause of action for filing the

present suit arose only in October 2023 when Respondent no.1 was

forcibly dispossessed from the suit property. He submits that the

Appellants cannot claim equities in their favour as the development

permissions were obtained after institution of the present suit.

According to him, if the Appellants are permitted to continue

construction activities and create third-party rights, the character of

the suit property would stand irreversibly altered, thereby rendering

any eventual decree for specific performance in the first suit illusory

and nugatory. He submits that the impugned order is a discretionary

order passed upon consideration of all relevant factors and therefore

does not warrant interference in appellate jurisdiction. He relied upon

the judgments of the Hon’ble Supreme Court in Dalpat Kumar &

Anr. v. Prahlad Singh1, Wander Ltd. & Anr. v. Antox India P. Ltd. 2,

Ramakant Ambalal Choksi v. Harish Ambalal Choksi & Ors.3,



1     (1992) 1 SCC 719
2     1990 (Supp) Supreme Court Cases 727
3     (2024) 11 SCC 351


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Daliben Valjibhai & Ors. v. Prajapati Kodarbhai Kachrabhai & Anr. 4

and contends that this Interim Application and the Appeal ought to be

dismissed.

Reasons:

11.      Having heard the learned senior counsel appearing for the

parties and having perused the record, I find that the Appellants have

made out a strong case for grant of interim relief pending hearing and

final disposal of the Appeal.


12.      The trial Court has proceeded on the basis that Respondent

no.1 was entitled to protection under Section 48 of the Transfer of

Property Act, 1882 and granted injunctions nearly thirty-two years

after the execution of the alleged Development Agreement of 1994.

Prima facie, such an approach is unsustainable in the present facts.

The Development Agreement of 1994 is not admitted by the

Appellants. It is an unregistered document and is also stated to be

inadequately stamped. Despite purporting to claim rights from 1994,

Respondent no.1 did not take any effective steps for enforcement of

those alleged rights for almost sixteen years, except issuing three

public notices between 2007 and 2010. Respondent no.1 filed the


4     2024 SCC OnLine SC 4105


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first suit seeking specific performance of the 1994 document only in

the year 2010. The application for ad-interim relief was rejected on

2nd August 2010 and the said rejection order admittedly was never

challenged. Consequently, Respondent no.1 remained without any

protective order in relation to the suit property. Thereafter,

Respondent no.1 instituted the second suit in the year 2023 alleging

dispossession from the suit property and sought cancellation of the

registered Development Agreement dated 15th July 2011 together

with consequential injunctions. Even in this second suit, the trial

Court rejected the prayer for ad-interim reliefs by order dated 12 th

December 2023 taking note of the delay between the alleged cause of

action and the institution of the suit. That order was also not

challenged. Thus, from 1994 till the passing of the impugned order

dated 10th March 2026, Respondent no.1 remained without any

interim protection whatsoever in respect of the suit property.


13.      The record indicates that when the 1994 Development

Agreement was purportedly executed, at least a part of the suit

property was under the custody of the Court Receiver. In the original

plaint filed in the first suit in 2010, Respondent no.1 has asserted

possession over the suit property. However, by way of amendment



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carried out in the year 2019, Respondent no.1 introduced additional

pleadings at paragraphs 10(a) and 10(b) and prayers (aa) and (bb)

seeking recovery of possession. Then in 2023, the present suit is filed

alleging dispossession. This inconsistent stand on possession and the

enforceability of the rights now claimed by Respondent no.1 casts a

serious doubt on the case of Respondent no.1. In the interregnum, a

duly stamped and registered Development Agreement dated 15 th July

2011 is executed. By virtue of Explanation I to Section 3 of the

Transfer of Property Act, 1882, Respondent no.1 is deemed to have

notice of the registered agreement. Respondent no.1 admittedly

claims to be a developer and investor carrying on land development

business in the Mira-Bhayander area for several decades. Prima

facie, it is difficult to accept that Respondent no.1 was unaware of the

registered instrument of 2011 for over a decade. There is no

satisfactory explanation from Respondent no.1 for the gross delay in

instituting proceedings to challenge the transaction only in the year

2023. Despite claiming rights since 1994, Respondent no.1 neither

secured conveyance nor obtained effective protection for over three

decades. The prolonged inaction weakens the discretionary relief

claimed by Respondent no.1 on the basis of Section 48 as against the

Appellants who claim under a registered instrument. In these


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circumstances, in my prima facie view, the trial Court in this second

suit could not have proceeded on the basis that Respondent no.1

possessed a superior right to defeat the subsequent registered

transaction of 2011.


14.      The judgment in Daliben Valjibhai, relied upon by Mr. Joshi,

does not advance the case of Respondent no.1. The said decision was

not rendered in the context of Section 3 of the Transfer of Property

Act, 1882. In that case, the High Court had allowed an application

under Order VII Rule 11 of the Code of Civil Procedure, 1908 and

rejected the plaint. The Hon’ble Supreme Court held that such

rejection was erroneous, since the suit had been instituted

immediately upon the plaintiffs discovering that the registered

document in question was forged. The Hon’ble Supreme Court

observed that instead of confining its scrutiny to the averments in the

plaint, the High Court had ventured into issues touching upon the

merits of the matter. The said decision is on different facts and has

no application to the facts of the present case.


15.      The judgments in Dalpat Kumar and Ramakant Ambalal

Choksi undoubtedly lay down the well-settled principle that an

appellate Court would ordinarily be slow to interfere with an order


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passed in exercise of discretionary jurisdiction unless the discretion is

shown to have been exercised arbitrarily, perversely or in disregard

of settled principles. Equally, the said judgments reiterate that a

plaintiff seeking injunction must establish not only a prima facie

case, but also balance of convenience and irreparable injury. The

conduct of the party seeking equitable relief is also a relevant and

material consideration. In Dalpat Kumar the Hon’ble Supreme Court

has held:

       “5. … Satisfaction that there is a prima facie case by itself is not
       sufficient to grant injunction. The Court further has to satisfy that
       non-interference by the Court would result in “irreparable injury”
       to the party seeking relief and that there is no other remedy
       available to the party except one to grant injunction and he needs
       protection from the consequences of apprehended injury or
       dispossession. Irreparable injury, however, does not mean that there
       must be no physical possibility of repairing the injury, but means
       only that the injury must be a material one, namely, one that cannot
       be adequately compensated by way of damages. The third condition
       also is that “the balance of convenience” must be in favour of
       granting injunction. The Court while granting or refusing to grant
       injunction should exercise sound judicial discretion to find the
       amount of substantial mischief or injury which is likely to be caused
       to the parties, if the injunction is refused and compare it with that
       which is likely to be caused to the other side if the injunction is
       granted. If on weighing competing possibilities or probabilities of
       likelihood of injury and if the Court considers that pending the suit,
       the subject-matter should be maintained in status quo, an injunction
       would be issued. Thus the Court has to exercise its sound judicial
       discretion in granting or refusing the relief of ad interim injunction
       pending the suit.”

       In my view, the aforesaid principles, when applied to the facts of




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the present case, are against the continuation of the injunction

granted by the trial Court.


16.      A party invoking equitable jurisdiction must demonstrate

diligence, fairness and bona fides. A litigant who remains inactive for

a prolonged period and permits another to openly deal with the

property cannot claim equitable protection as a matter of course.

Respondent no.1 himself is an experienced developer. The record

indicates that statutory permissions are obtained and substantial

development activities have progressed. In my view, the trial Court

erred in applying the provisions of Section 48 of the Transfer of

Property Act, 1882, as no ground has been made out to attract the

said provision.


17.      Insofar as balance of convenience is concerned, in my view the

same lies in favour of the Appellants. Continuation of the injunction

granted by the trial Court would stall the entire development project

and expose the Appellants to serious financial and commercial

prejudice. The suit property cannot remain indefinitely frozen merely

because a suit has been instituted after prolonged inaction of 16

years, a second suit after 12 years of the Appellant’s agreement and

without protective orders. The interests of Respondent no.1 can be


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adequately safeguarded during pendency of the proceedings by

imposing appropriate conditions of securing the amount in dispute.

However, Mr. Joshi, on instructions, states that Respondent no.1 is

unwilling to accept the without prejudice terms suggested on behalf

of the Appellants. In any event, it would remain open to Respondent

no.1 to pursue an appropriate claim for damages.


18.      In the aforesaid circumstances, I am of the prima facie view

that the trial Court has exercised its discretion arbitrarily and in

disregard of settled principles governing grant of interim injunctions.

The trial Court has failed to consider the rejection of reliefs in the

earlier proceedings, the unexplained delay on the part of Respondent

no.1, the absence of any interim protection for more than three

decades and the substantial development already undertaken pursuant

to the registered transaction of 2011. The impugned order warrants

interference as the exercise of discretion by the trial Court appears to

be palpably erroneous and unsustainable. In these circumstances, I

am satisfied that the Appellants have made out a case for grant of

interim relief pending hearing and final disposal of the Appeal from

Order. Hence, Interim Application no.3646 of 2026 is allowed in

terms of prayer clause (a), which reads as under:



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                         “a.     Pending the hearing and final disposal of the present
                         Interim Application, the execution, operation, implementation and
                         effect of the impugned Judgment and Order dated 10 th March
                         2026 passed by the 4th Joint Civil Judge, Senior Division, below
                         Exhibit-5 in Special Civil Suit no.555 of 2023 may kindly be
                         suspended and stayed.”


              19.      List the Appeal on 1st July 2026.


              20.      After the order was pronounced, Mr. Ashish Pyasi, learned

              counsel for Respondent no.1 seeks a stay of this order for a period of

              4 weeks. This is opposed by Mr. Godbole. For the reasons stated

              above and since this is an interim order vacating the injunction

              passed after more than two decades after the Appellant’s

              Development Agreement is executed and registered, the application

              for stay is rejected.


                                                             [GAUTAM A. ANKHAD, J.]
BHARAT
DASHARATH
PANDIT

Digitally signed by
BHARAT
DASHARATH
PANDIT
Date: 2026.05.28
13:34:14 +0530




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