M/S. SADA ANAND DEVELOPERS THR. PARTNER MR. SADANAND KRISHNA SHETTYversusSHREE BALAJI REALTY THR. ITS PARTNER MEENAMANI GANGA BUILDERS LLP THR.ITS ANJU UMESH GOEL

                                                                    1 of 17                       4.AO.627.2026.DOC



                                             IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                                    CIVIL APPELLATE JURISDICTION

                                                  APPEAL FROM ORDER NO.627 OF 2026
                                                                WITH
                                                 INTERIM APPLICATION NO.4389 OF 2026

                               M/s.Sada Anand Developers, through its Partner
                               Mr.Sadanand K.Shetty, 10, Padmajee Classic,
                               Mahaparvez Road, Near Pasamjee Park,
                               Nana Peth, Pune-411002.                                              Appellant
                                             versus
                               Shree Balaji Realty, through Partner
                               Meenamni Ganga Builders LLP, through partner
                               Anju Umesh Goel,
                               Opp.Poona Club, Bund Garden Road,
                               Pune-411001.                                                         Respondent

                                                                 _______
                               Mr.Sanjeev Kadam, Senior Advocate, i/by Mr.Swapnil R.Chopade for Appellant.
                               Mr.Jaydeep Deo for Respondent.
                                                                    _______

                                                          CORAM         :      AARTI SATHE, J.

                                                          DATE          :      18th August 2026

                               ORAL JUDGMENT :-

                               1.           This Appeal from Order under Order XLIII, Rule 1(r) read with

                               Section 104 of the Code of Civil Procedure, 1908 takes an exception to the order

                               dated 14th February 2025 passed by the 5th Joint Civil Judge, Senior Division, Pune

                               (`the Trial Court’) passed below Exhibit-5 (`impugned order’) in Special Civil Suit

                               No.387 of 2024 (`the suit’), inter-alia, temporarily restraining the Appellant

                               (Original Defendant) either by itself or through agents, servants, power of attorney
            Digitally signed
MANISH      by MANISH
SURESHRAO
            SURESHRAO
            THATTE
                               holders, representatives and anybody claiming for and on behalf of the Appellant
THATTE      Date: 2026.08.24
            19:02:32 +0530


                               (Original Defendant) from transferring, alienating, or any way creating third party



                               M.S.Thatte
                                         2 of 17                   4.AO.627.2026.DOC



interest in any part of the Transferable Development Rights (TDR) i.e.

admeasuring 5200 sq. mtrs. which is subject matter of agreement dated 13 th July

2022 till disposal of the suit.

2.           Briefly the facts are as follows:

             i. The Appellant (Original Defendant) approached the Respondent

(Original Plaintiff) with a proposal regarding a project under Slum Rehabilitation

Scheme on final plot no.57 situated at Mangalwar Peth, Pune. The Appellant

(Original Defendant) also informed the Respondent (Original Plaintiff) that the

project had been duly sanctioned by the Pune Municipal Corporation and by

Competent Authority under the The Maharashtra Slum Areas (Improvement,

Clearance and Redevelopment) Act, 1971 (‘Slum Act’) and further the Appellant

(Original Defendant) had obtained appropriate rights for development and sale of

the said property. The Appellant (Original Defendant) also represented to the

Respondent (Original Plaintiff) that after completion of the project, it was entitled

to obtain Floor Space Index (`FSI’) credit of built-up area of approximately 5,808

sq. mtrs. in the form of Development Rights Certificate (`DRC’). On 6 th July 2022,

upon negotiations for purchase of TDR potential of 5,200 sq. mtrs. from the

Appellant (Original Defendant), the Respondent (Original Plaintiff) initially paid

Rs.2,47,50,000/- through RTGS from HDFC Bank, Pune to the Appellant

(Original Defendant).

             ii.       Pursuant thereto, on 13th July 2022, a Memorandum of

Understanding (`MOU’) was executed between the two parties for a total

consideration of Rs.8,23,05,600/- pursuant to which the Respondent (Original




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                                     3 of 17                       4.AO.627.2026.DOC



Plaintiff) had agreed to purchase from the Appellant (Original Defendant) the

TDR to the extent of 5,200 sq. mtrs. out of the total area of DRC issued by the

Competent Authority.

             iii.   On 25th August 2022, the Respondent (Original Plaintiff)

made further payment of Rs.1,48,50,000/- and also made further payment of

Rs.40,000/- towards Tax Deductible at Source (TDS) under Section 194(Q) of the

Income Tax Act 1961. It is the Respondent’s (Original Plaintiff’s) contention that

the Appellant (Original Defendant) has accepted and received Rs.4,00,00,000/-

from the Respondent (Original Plaintiff).

             iv.    It is the contention of Appellant (Original Defendant) that as

per clause 4A and 4B of the MOU, the Appellant (Original Defendant) was

supposed to obtain DRC from the Competent Authority on or before 13 th October

2022, however, on account of certain technical difficulties, the Appellant (Original

Defendant) was unable to obtain the DRC from the Competent Authority. On

18th October 2023, the Appellant (Original Defendant) issued a notice to the

Respondent (Original Plaintiff) cancelling the MOU dated 13th July 2022 in view

of the fact that DRC had not been received by the Appellant (Original Defendant).

Thereafter on 12th November 2023 and 28th November 2023, replies and

rejoinders were exchanged between the Appellant (Original Defendant) and the

Respondent (Original Plaintiff) pursuant to the notice dated 18th October 2023. It

is not in dispute that the amount of Rs.4,00,00,000/- has been paid by the

Respondent (Original Plaintiff) to the Appellant (Original Defendant).




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                                      4 of 17                       4.AO.627.2026.DOC



             v. On 16th February 2024, the Respondent (Original Plaintiff) filed a

suit bearing Special Civil Suit No.387 of 2024 before Civil Judge, Senior Division,

Pune praying for a declaration that the notice dated 18 th October 2023 terminating

the MOU dated 13th July 2022 is illegal and also for specific performance of the

MOU against the Appellant (Original Defendant). An application for temporary

injunction was filed praying that the Appellant (Original Defendant) be restrained

from creating third party rights in respect of TDR. On 25 th June 2024, the

Respondent (Original Plaintiff) filed another application, inter-alia, seeking

temporary injunction against the Appellant (Original Defendant) along with list of

documents annexed thereto. The Appellant (Original Defendant) filed reply to the

aforesaid application opposing the grant of temporary injunction on 9 th July 2024

and further on 12th July 2024 the Appellant (Original Defendant) filed their

written statement and also an application for list of documents. On 25 th July 2024,

the Respondent (Original Plaintiff) filed their counter affidavit and thereafter on

14th February 2025, by the impugned order, the Trial Court allowed Exhibit-5 of

the Respondent (Original Plaintiff) thereby temporarily restraining the Appellant

(Original Defendant), either by itself or through agents, servants, power of

attorney holders, representatives and anybody claiming for and on behalf of the

Appellant (Original Defendant) from transferring, alienating, or any way creating

third party interest in any part of the TDR i.e. admeasuring 5200 sq. mtrs. which is

subject matter of MOU dated 13th July 2022 till disposal of the suit, as aforesaid.

             vi.     Being aggrieved by the impugned order the Appellant

(Original Defendant) has filed present Appeal from Order.




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                                     5 of 17                       4.AO.627.2026.DOC



3.           Mr. Sanjeev Kadam, Senior Advocate instructed by Mr. Swapnil

Chopade appeared on behalf of the Appellant (Original Defendant). Mr. Jaydeep

Deo appeared on behalf of the Respondent (Original Plaintiff).

4.           It is submitted by Mr. Kadam, learned Senior Advocate, appearing for

the Appellant (Original Defendant) that, the impugned order suffers from non-

consideration of relevant facts and also of the applicable legal provisions, inasmuch

as, the Trial Court has erred in not appreciating that by filing the said suit, the

Respondent (Original Plaintiff) is seeking specific performance of the MOU dated

13th July 2022, which cannot be sustained, as the MOU is not an agreement or a

contract and, hence, not enforceable under Specific Relief Act, 1963 (‘the Act’). It

is further his submission that the impugned order has not taken into consideration

the relevant clauses of the MOU dated 13 th July 2022, which very categorically

provide that in the event the MOU is cancelled due to any reason whatsoever or

due to lapse of time period agreed between the parties to procure the proposed

DRC, the Appellant (Original Defendant) would issue cheques towards repayment

of the amount tendered by the Respondent (Original Plaintiff) as mentioned in

clauses 4A and 4B of the MOU. Since the Appellant (Original Defendant) was

unable to procure the DRC in the stipulated time, the Appellant (Original

Defendant) had intimated the Respondent (Original Plaintiff) its inability to

procure the DRC and hence sought to cancel the said MOU dated 13 th July 2022.

5.           It is his submission that at that time when the Appellant (Original

Defendant) sought to cancel the MOU, the Respondent (Original Plaintiff)

voluntarily extended the time to procure the DRC by six months to perform its




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                                      6 of 17                        4.AO.627.2026.DOC



part under the said MOU. He further submitted that the Appellant (Original

Defendant) had accorded its irrevocable consent to deposit the security cheques

given to the Respondent (Original Plaintiff) and the same were not being deposited

by the Respondent (Original Plaintiff) on account of insistence of the Respondent

(Original Plaintiff) to specifically perform the obligations as envisaged under the

MOU by the Appellant (Original Defendant).             He submitted that such an

approach on the part of the Respondent (Original Plaintiff) is an erroneous

approach as the MOU by its very nature is a determinable document and once that

being the position, the same becomes an unenforceable document, as contemplated

under Section 14(d) of the amended Act. He, therefore, submitted that filing of

the suit itself under the provisions of the Act is bad in law and not maintainable.

6.           It was further his submission that the Trial Court in the impugned

order has not rendered any finding in respect of this vital provision regarding

unenforceability of the MOU under the provisions of Section 14(d) of the Act,

which strikes at the very root of the matter thereby vitiating the impugned order.

He, therefore, submitted that considering that the impugned order was silent on

the aforesaid issue, grant of injunction against the Appellant (Original Defendant)

could not be sustained. He also submitted that the sole ground given by the Trial

Court for allowing Exhibit-5 is that the Respondent (Original Plaintiff) had paid

almost Rs.4,00,00,000/- to the Appellant (Original Defendant), and therefore after

obtaining the DRC from the Competent Authority, the Appellant (Original

Defendant) would be in a position to create third party rights/interests or sell or

transfer or alienate the TDR on account of which the Respondent (Original




M.S.Thatte
                                      7 of 17                        4.AO.627.2026.DOC



Plaintiff) would suffer irreparable loss. This finding, in his submission, was an

erroneous finding, inasmuch as, the Appellant (Original Defendant) had issued

cheques to the Respondents (Original Plaintiffs) towards refund and had also given

their irrevocable consent to encash them which option had not been exercised by

the Respondent (Original Plaintiff). In view of the aforesaid, he submitted that the

impugned order has completely failed to take into consideration the relevant facts

and thus is liable to be set aside. He also sought to place reliance on the decision of

Narendra Hirawat and Company Vs. Sholay Media Entertainment Pvt. Ltd. and

another1, passed by this Court to contend that an agreement which by very nature

is determinable, cannot be enforceable through specific performance. He submitted

that in the facts of the present case, on the reading of clauses 4A and 4B of the

MOU, it was clear that the MOU was determinable in nature and hence specific

performance of that MOU could not be insisted upon by the Respondent (Original

Plaintiff).

7.            Per contra, learned counsel for the Respondent (Original Plaintiff)

submitted that the impugned order has been rightly passed by the Trial Court and

the MOU was a contract which could be terminated only by the Respondent

(Original Plaintiff) under Clauses 4A and 4B of the said MOU. He submitted that

Clause 4B of the MOU specifically gave a right to the Respondent (Original

Plaintiff) to terminate the MOU. He submitted that in the event the Appellant

(Original Defendant) was unable to obtain the DRC within the stipulated time i.e.

on or before 13th October 2022, then the Respondent (Original Plaintiff) would


12020(5)-Mh.L.J.-173



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                                               8 of 17                            4.AO.627.2026.DOC



have option to claim from the Appellant (Original Defendant) compound interest

for the delayed period @ 12% p.a. on the amount paid by the Respondent

(Original Plaintiff) to the Appellant (Original Defendant) and the said amount of

interest would be deducted from the balance consideration to be paid by the

Respondent (Original Plaintiff) to the Appellant (Original Defendant). He further

submitted that Clause 4B gives a right to the Respondent (Original Plaintiff) to

terminate the agreement and in that event the Appellant (Original Defendant)

would unconditionally and without any delay refund the entire amount paid by the

Respondent (Original Plaintiff) to the Appellant (Original Defendant) as per terms

set out in the said clause.              He further submitted that since the amount of

Rs.4,00,00,000/- had already been paid to the Appellant (Original Defendant),

there was a high chance that the Appellant (Original Defendant) would create

third-party rights after obtaining DRC from the Competent Authority. In view

thereof, he submitted that the impugned order had rightly restrained the Appellant

(Original Defendant) from creating any third-party rights in respect of 5,200 sq.

mtr. of TDR till disposal of the suit.

                                   ANALYSIS AND FINDINGS

8.               I have considered the rival submissions and perused the impugned

order along with relevant documents. At the very outset, since the dispute revolves

around the interpretation of the clauses of the MOU dated 13 th July 2022 as to

whether the same would be a contract which would be specifically performed, it

would be pertinent to reproduce the relevant clauses of the said MOU.

             “4A) It has been agreed by and between the parties that, in case this agreement is
             cancelled due to any reason whatsoever or due to lapse of time period agreed




M.S.Thatte
                                                 9 of 17                              4.AO.627.2026.DOC


             herein to procure the proposed DRC, the Party of the First Part shall issue two
             cheques towards the Security towards the re-payment of the amount tendered by
             the Second Party as mentioned hereinabove para 3(a)and 3(b), on execution of
             these presents as follows which shall be kept with the Party of the Second Part :
             A) Demand Draft (DD) bearing no.________ dated ______ amount of
             Rs.2,50,00,000/- to be handed over at the time of present execution hereof;

             B) Cheque bearing no._____ dated __________ amount of Rs.1,50,00,000/- to
             be handed over at the time of receipt of 2 nd Part/Installment Payment;

             #NOTE : The Party of the First Part has accorded its irrevocable consent to
             deposit the said cheques without any further written or oral consent. However, the
             said cheques shall be returned on execution of the proposed Deed of Transfer as
             decided between the parties.

             4B) Without prejudice to any of the rights of the Party of the First Part/Transferor
             herein or as available in law the Party of the First Part shall in the event of failure
             to obtain the Development Right Certificate (DRC) within the stipulated time as
             stated herein i.e. on or before 30/09/2022 OR due to any circumstances if the
             Party of the First Part/Transferor fail to obtain the said proposed T.D.R on or
             before 30/09/2022 then, the Party of the Second Part/Proposed Transferee shall
             have option to claim from the Party of the First Part compound interest for the
             delay period @ 12% per annum on the amount paid by the Party of the Second
             Part to the Party of the First Part under these presents, which amount of interest
             shall be deducted from the balance consideration to be paid by the Party of the
             Second Part/Proposed Transferee under these presents OR the Party of the Second
             Part/Proposed Transferee can opt to terminate this Agreement. In the
             circumstances, if the Party of the Second Part/Proposed Transferee opt to
             terminate this Agreement then the Party of the First Part/Transferor shall
             unconditionally and without any delay refund the entire amounts paid by the
             Proposed Transferee/Party of the Second Part to the Party of the First Part/
             Transferor under these presents along with compound interest to be calculated @
             12% per annum from the date of payment of the said amount by the Proposed
             Transferee/Party of Second Part to the Party of the First Part/Transferor till the
             date of repayment of the said amounts by the Party of the First Part to the
             proposed Transferee/Party of the Second Part and till such amounts are fully repaid
             the Proposed Transferee/Party of the Second shall have charge for the said
             amounts on the other assets and properties of the First Part/Transferor herein.”
                                                                               (emphasis supplied)

9.                On a plain reading of the aforesaid clauses it is clear that both the

clauses have to be given a holistic interpretation and cannot be read in isolation

with each other. Clause 4-A specifically envisages that it is agreed by and between

the parties that in case this agreement is cancelled due to any reason whatsoever or

due to lapse of time period agreed therein to procure the proposed DRC by the

Appellant (Original Defendant), the Appellant (Original Defendant) would issue



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                                       10 of 17                        4.AO.627.2026.DOC



two cheques towards security towards repayment of the amount paid by the

Respondent (Original Plaintiff) as mentioned in paragraph 3(a) and 3(b) of the

said MOU. It further contemplates that the said amounts would be kept by the

Respondent (Original Plaintiff) and that the Appellant (Original Defendant)

would accord irrevocable consent to deposit the said cheques without any written

or oral consent. The only condition being that those cheques would be returned

on execution of the proposed deed of transfer as decided between the parties.

Thereafter clause 4B stipulates that if the DRC does not come on or before 13 th

October 2022, then the Respondent (Original Plaintiff) would be entitled for

compound interest for the delay period @ 12% p.a. on the amount paid and if the

Respondent (Original Plaintiff) opts to terminate the MOU, then the Appellant

(Original Defendant) will be duty bound to unconditionally refund the entire

amount to the Respondent (Original Plaintiff).

10.          Therefore, on a reading of the aforesaid two clauses, it is clear that the

MOU is of such a nature that the same is determinable, inasmuch as, the same

would be inherently determinable as the parties do not have to assign any reason to

terminate the same and the terms of termination are envisaged in the contract

itself. Once that being the position, then the provisions of the Act cannot be

pressed into to specifically perform the obligations contained therein.            I am,

therefore, in agreement with the contention as canvassed by learned counsel for the

Appellant (Original Defendant) that the impugned order does not consider the

effect of clause 4A while interpreting the provisions of Clause 4B and the Trial

Court has not applied its mind or come to a prima facie view regarding specific




M.S.Thatte
                                                 11 of 17                             4.AO.627.2026.DOC



performance of the MOU dated 13 th July 2022. This to my mind goes to the root

of the matter and had to be adjudicated upon by the Trial Court before granting

injunction. The provisions of Order XXXIX, Rule 1 of CPC are to protect the

property in dispute if it is in danger of being wasted, damaged or alienated by any

party to the suit or wrongfully sold in execution of a decree or if the Defendant

threatens or intends to remove or dispose of his property with a view to defrauding

his creditors and that the Defendant threatens to dispossess the Plaintiff or

otherwise cause injury to the Plaintiff in relation to any property in dispute in the

suit. In the facts of the present case, there is no existence of the property or a threat

of dispossessing the Respondent (Original Plaintiff) from any property and hence

question of exercising the jurisdiction under Order XXXIX, Rule 1 of CPC by the

Trial Court without first giving its prima facie view on the issue of enforceability of

the MOU dated 13th July 2022, is an incorrect approach adopted by the Trial

Court.

11.               I am further of the view that reliance by learned counsel for the

Appellant (Original Defendant) on the decision in case of Narendra Hirawat and

Co. (supra) is correct to contend that the MOU is a determinable document by its

very nature and hence specific performance thereon cannot be granted. The

relevant paragraphs of the aforesaid decision are reproduced below:

             “8. The question now is whether the plaintiff deserves any interim, protection
             pending such trial. Dr. Saraf, for defendant No. 1, submits, and he is joined in this
             by Mr. Andhyarujina, who appears for defendant No. 2, that the suit agreements
             being in the nature of a licence, and accordingly, by their very nature being
             determinable, their specific performance cannot prima facie be granted. Learned
             Counsel rely on the provisions of section 14(d) of the amended Specific Relief Act.
             (Amended section 14(b) is in pari materia with old section 14(1)(c) of the un-
             amended Specific Relief Act.) The word "licence" used in the suit agreements is
             not some special term of art so as to give rise to any particular consequence, as a




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                                                 12 of 17                             4.AO.627.2026.DOC


             matter of law, so far as revocability or determinability of the agreements is
             concerned; the consequence would rather depend on the agreements read as a
             whole. Apropos the agreements and having regard to the particular term of
             determination thereunder, Dr. Saraf and Mr. Andhyarujina argue that the contract
             is clearly determinable and if that is so, no specific performance is permissible.
             Learned Counsel rely on the cases of Indian Oil Corporation Ltd. vs. Amritsar Gas
             Service, (1991) 1 SCC 533, Jindal Steel and Power Limited vs. M/s SAP India Pvt.
             Ltd., (2015) 221 DLT 708 and Spice Digital Ltd. vs. Vistass Digital Media Pvt.
             Ltd., 2012 MhLJ Online 105 (2012) 114 (6) Bom LR 3696. Relying on these
             cases, it is submitted that since the subject agreements contain a termination
             clause, they must be treated, as, by their very nature, determinable and accordingly,
             no specific performance should be granted. Learned Counsel are not right there.
             When the relevant provision section 14(d) of the Specific Relief Act] uses the
             words "a contract which is in its nature determinable", what it means is that the
             contract is determinable at the sweet will of a party to it, that is to say, without
             reference to the other party or without reference to any breach committed by the
             other party or without reference to any eventuality or circumstance. In other
             words, it contemplates a unilateral right in a party to a contract to determine the
             contract without assigning any reason or, for that matter, without having any
             reason. The contract in the present case is not so determinable; it is determinable
             only in the event of the other party to the contract committing a breach of the
             agreement. In other words, its determination depends on an eventuality, which
             may or may not occur, and if that is so, the contract clearly is not "in its nature
             determinable".

             9. The cases cited by learned Counsel for the defendants are clearly
             distinguishable on facts. In Indian Oil Corporation (supra), the contract (clause-
             28 of the distributorship agreement) gave right to either party to determine the
             agreement by giving 30 days' notice and the only relief that was permissible in
             such a case was award of a compensation for the period of notice, that is to say, 30
             days. It is in the context of this clause that the Supreme Court held that the
             respondent before it (original plaintiff) was not entitled to restoration of its
             distributorship terminated by the appellant (original defendant) but only entitled
             to compensation for loss of earning for the notice period of 30 days, since such
             notice was not given by the defendant to the plaintiff. Likewise, in Jindal Steel and
             Power Ltd. (supra), the relevant clause of the contract gave right to the respondent
             before the Court (original defendant) to terminate the licence after giving 30 days'
             notice to the petitioner (original plaintiff). In pursuance of this clause, a learned
             Single Judge of Delhi High Court held that the contract was determinable by its
             very nature. In Spice Digital Ltd. (supra), the relevant contract (clause 6.2 of the
             agreement before the Court) gave right to either party to the contract to terminate
             the agreement upon a 30 days' prior written notice to the other party without
             assigning any reason for such termination. Once again, it is in the context of such
             unilateral right of termination that the Court came to a conclusion that the
             contract was, by its very nature, determinable and no specific performance could
             be claimed. All these cases are clearly distinguishable and do not support the
             defendants' case here.

             10. I am fortified in the view I am taking by a Division Bench judgment of Kerala
             High Court in the case of T. O. Abraham vs. Jose Thomas, (2018) 1 KLJ 128. The
             learned Judges, in paragraph-18 of the judgment, considered the question of
             determinability "in its nature" of a contract in the following words:




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                   "The question thus before us is whether this contract is determinable. Before
              we answer this, we deem it necessary to understand clearly what is meant by
              determinable contracts. In the now repealed Specific Performance Act, 1877,
              section 21(d) stipulated that a contract, which in its nature is revokable, cannot be
              enforced to unenforceable contracts. The provision of the old Act corresponds to
              section 14(1)(c) of the Specific Relief Act, 1963 (which will, hereinafter be referred
              to as the "Act' for convenience), the only difference between the two being that
              the word 'revokable' has been substituted with the word 'determinable. This was
              done because the word 'revokable' was inaccurate and it was felt that a more
              accurate word for it be substituted. Therefore, it is indubitable that a contract
              which in its nature is revokable or determinable, as described in the provisions of
              the sections afore referred, is definitely not enforceable through specific
              performance. For a contract to become determinable, it has to be first shown by
              the defendant that its clauses and terms are such that it would become possible for
              either of the parties to determine and terminate it without assigning any reason.
              The words used in section 14(1)(c) is 'inherently determinable'. The effect of the
              use of the word 'inherently' in the section is to make it unambiguously clear that a
              contract which can be terminated by either of the parties on their own will without
              any further reason and without having to show any cause, would ones are
              inherently determinable. However, if an agreement is shown to be determinable at
              the happening of an event or on the occurrence of a certain exigency, then it is
              incluctable that on such event or exigency happening or occurring alone that the
              contract would stand determined. In order to see if a particular contract is
              inherently determinable or otherwise, we have to first see whether the parties to
              the said contract have the right to determine it or to terminate it on their own
              without the junction of any other party and without assigning any reason. This is
              akin to a partnership at will, where one of the partners can notify the others of his
              intention not to continue in the said firm and the partnership itself then dissolves.
              The analogy we think is appropriate because a contract, to be inherently
              determinable, will have to specifically provide competence to the parties to it to
              terminate it without assigning any reason and merely by indicating that he does
              not intend to comply with the same."
                                                                                (emphasis supplied)

12.                This Court in the case of Chetan Iron LLP vs. NRC Ltd.2 in an

Arbitration Petition which also involved an issue on specific performance of the

contract has held that a contract which by its very nature is determinable, specific

performance thereof cannot be insisted upon. Relevant paragraphs of the aforesaid

decision are reproduced below-

             18. Having heard learned Counsel for the parties and having perused the record,
             it is quite clear that the contract as awarded by the respondent to the petitioner has
             not been terminated and/or that the contract is partly performed by the petitioner by
             lifting some material on payment of the price to the respondent. However, even in
             these circumstances, when a question arises before the Court, to consider granting of
             reliefs in the nature as prayed for by the petitioner, in my opinion, the basic

2 2022 SCC OnLine Bom 159



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             consideration for the Court would be to examine as to what is the nature of the
             contract between the parties. Perusal of the contract and the general terms and
             conditions as appended thereto, more particularly, Clause (5) thereof, clearly
             indicate that the parties have provided that either of the parties can terminate the
             contract with a fifteen days notice to be served on the other party. Further such
             clause also provides for the validity of the contract up to 30 June, 2022. It is thus
             clear that nature of the contract in question is determinable. If that be so, then Mr.
             Nankani would be correct in his contention that the provisions under sub-clause (d)
             of section 14 of the Specific Relief Act which provides that a contract which is in its
             nature determinable, cannot be specifically enforced becomes applicable.

             19. In the context of section 14(1)(d) of the Specific Relief Act, another provision
             which would become relevant is section 41 of the Specific Relief Act, which provides
             as to when an injunction would be refused or when it cannot be granted. Section
             41(e) provides that an injunction cannot be granted by the Court to prevent the
             breach of a contract, the performance of which would not be specifically enforced.
             Thus once the nature of the contract itself is such, that it cannot be specifically
             enforced, section 41(e) of the Specific Relief Act would stare at the petitioner when
             the petitioner claims a relief of an injunction. Certainly, the principles which are
             embodied in section 14(d) read with section 41(e) of the Specific Relief Act are
             applicable even when the Court considers an application under section 9 of the Act
             for interim measures. It is a settled principle of law that although section 9 is a
             remedy available to the parties having an arbitration agreement between them,
             however, when a relief for grant of an injunction is prayed for, certainly the Court
             would be guided by the principles as contained in the Specific Relief Act read with
             the provisions of Order 39 of the Code of Civil Procedure.

             20. In the above context, it would be apposite to consider the position in law. In
             the celebrated commentary of Pollock and Mulla on “The Indian Contract Act and
             the Specific Relief Act”, (Nth Edn, Volume II, page 1939), the views of the learned
             authors on ‘determinable contracts’ being not enforceable as per the provisions of
             section 14(1) (c)(pre 2018 amendment) of the Specific Relief Act need to be noted,
             which read thus:
                    “Clause (c) : Determinable Contracts
                    ……….
                    A contract, which is in its nature revocable, or determinable as described in
                    Specific Relief Act, is not enforceable by specific performance. Specific
                    performance is not decreed if the defendant would be entitled to revoke or
                    dissolve a contract when executed, as in the case of a contract containing an
                    express power of revocation, since it would be idle to do that which might
                    instantly be undone by one of the parties,
                                                                                (emphasis added)

             21.     The following decisions would throw light on the principles of law the
             Courts have consistently followed in refusing injunctory reliefs and specific
             performance of the contract, when the nature of the contract is determinable.
                    In Indian Oil Corporation Ltd. v. Amritsar Gas Service, (1991) 1 SCC 533
             the Supreme Court was considering a dispute between the parties as arising under a
             distributorship agreement which, permitted either party to terminate the agreement
             by 30 days' notice to the other party without assigning any reason for the
             termination. A dispute had arisen between the parties on wrongful termination of
             the agreement. The dispute was referred to arbitration. The arbitral tribunal in its
             award granted restoration of the distributorship as one of the reliefs to the claimant.
             This relief granted by the arbitral Tribunal was challenged by the appellant under




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             section 34 asserting the applicability of section 14 (1)(c) of the Specific Relief Act
             contending that when the arbitral tribunal having noted that the contract was
             determinable, it could not have proceeded to grant a relief of specific performance of
             the contract. In such context, the Supreme Court held that the contract in question
             by its nature was determinable, hence granting the relief of restoration of the
             distributorship was contrary to the mandate of section 14(1)(c) of the Specific Relief
             Act. In paragraph 12 it was observed thus:—

                “12……….The finding in the award being that the Distributorship Agreement
                was revokable and the same being admittedly for rendering personal service, the
                relevant provisions of the Specific Relief Act were automatically attracted. Sub-
                section (1) of section 14 of the Specific Relief Act specifies the contracts which
                cannot be specifically enforced, one of which is ‘a contract which is in its nature
                determinable’. In the present case, it is not necessary to refer to the other clauses
                of sub section (1) of section 14, which also may be attracted in the present case
                since clause (c) clearly applies on the finding read with reasons given in the award
                itself that the contract by its nature is determinable. This being so granting the
                relief of restoration of the distributorship even on the finding that the breach was
                committed by the appellant-Corporation is contrary to the mandate in section
                14(1) of the Specific Relief Act and there is an error of law apparent on the face
                of the award which is stated to be made according to ‘the law governing such
                cases.’ The grant of this relief in the award cannot, therefore, be sustained.
                                                                           (emphasis added)”

             22. In Spice Digital Ltd. v. Vistaas Digital Media Pvt. Ltd., 2012 SCC OnLine
             Bom 1536 : 2012 Mah LJ OnLine 105, learned Single Judge of this Court was
             considering an appeal filed under section 37 of the Act against an order of the
             arbitral tribunal passed under section 17 of the Act, refusing a relief of interim
             injunction to the applicant on the ground that the contract between the parties was
             determinable. It was held that the tribunal was right in refusing to grant injunction
             under section 17 of the Act, as the same would have amounted to granting a relief
             against the provisions of the Specific Relief Act. The Court, accordingly, rejected the
             appeal. Mr. Justice R.D. Dhanuka speaking for the bench observed thus:
                “20. In my view, the arbitral tribunal was right in its prima facie view that clause
                6.2. read with clause 12.1 shows that the contract is determinable during the lock
                in period. Section 14(1) (c) provides that the contract which in its nature is
                determinable, cannot be specifically enforced. The Judgments of the Supreme
                Court in the case of Indian Oil Limited (supra), Delhi High Court and also the
                judgment of the Supreme Court in the case of Cox and Kings are clearly
                applicable to the facts of this case. In my view, the arbitral tribunal has
                interpreted the terms of the contract and has recorded prima facie finding that
                the contract is determinable and thus no specific performance of such contract
                can be enforced in view of section 14(1)(c). This interpretation of the arbitral
                ‘tribunal is a possible interpretation and thus no interference is warranted at this
                stage.
                21. In my view, the injunction sought by the Appellant under section 17 of the
                Arbitration Act, 1996 for the contract which is terminated even according to the
                appellant, such injunction is statutorily prohibited. In my view, at the interim
                stage, the arbitral tribunal while deciding application under section 17 and the
                court deciding application under section 9 of the Arbitration Act, 1996 cannot
                continue operation of such determinable contract or the same having been
                terminated otherwise it would amount to re-writing the contract. In my view the
                arbitral tribunal was thus right in refusing to grant injunction under section 17 of
                the Arbitration Act, 1996. Even otherwise, the arbitral tribunal has given a




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                finding of fact after considering the facts, provisions of the agreement and the
                provisions of Specific Relief Act and thus no interference is warranted by this
                court with such finding of fact recorded by the arbitral tribunal at this stage.”

             23. In Mittal Services v. Escotel Mobile Communication Ltd., AIR 2003 Del 410,
             learned Single Judge of Delhi High Court in the context of a franchisee agreement,
             observed that the prayer of the plaintiff therein, that the defendant be restrained by
             an injunction from appointing another franchisee in the concerned territory, could
             not have been granted, as the contract in the said case contained a clause which
             provided for termination of the agreement with a ninety days advance notice in
             writing. It was also observed that the agreement was for a specific period of five years
             and that too determinable by any party, by serving a 90 days advance notice. In these
             facts, the Court observed that section 41(e) of the Specific Relief Act would get
             attracted which provided that no injunction can be granted to prevent breach of the
             contract, the performance of which is not specifically enforceable. It was observed
             that as the agreement in its nature was determinable by giving a 90 days advance
             notice in writing, the agreement obviously was one which could not have been
             specifically enforceable. The Court also referring to the decision of the Division
             Bench of the Delhi High Court in Rajasthan Breweries Ltd. v. Stroh Brewery
             Company, AIR 2000 Del 450 wherein the Division Bench had upheld the findings
             of the learned Single Judge which were to the effect that when an injunction prayed
             for was statutorily prohibited on a conjoint reading of section 41 and 14(1)(c)1 of
             the Specific Relief Act, as the contracts in question were determinable in nature, no
             injunction could be granted, and this would be the mandate of law. I am in complete
             agreement with a view taken by the learned Single Judge of this Court in Spice
             Digital Ltd. (supra) as also the decision of the learned Single Judge of the Delhi
             High Court in Mittal Services (supra).

             24. The position in law as laid down in the above decisions is fully applicable to
             the facts of the present case which in my clear opinion, dis-entitles the petitioner for
             any reliefs as prayed for. It needs to be observed that an exception to section 41(e) of
             the Specific Relief Act as carved out in section 42 of the Specific Relief Act is also
             not applicable in the facts of the present case. In any event the petitioner cannot be
             granted any relief applying the well settled principle that an interim relief can be
             granted only in aid of and ancillary to the main relief. It is prima facie seen that a
             relief of specific performance or an injunction cannot be granted to the petitioner,
             hence, a relief of a temporary injunction as an interim measure cannot be granted to
             the petitioner, pending the arbitral proceedings.

             25. Now to discuss the reliefs as prayed for by the petitioner, it is seen that the
             reliefs as prayed for, in terms of the prayer clause (a) and (d) are in the nature of a
             final relief, that is, they are as good as in the nature of granting a specific
             performance of the contract, which for the aforesaid reasons, certainly cannot be
             granted. Insofar as prayer clause (b) and (c) are concerned, they are in the nature of
             an injunction which cannot be granted to the petitioner in the context of the
             contract in question, which cannot be ordered to be specifically performed.
                                                                              (emphasis supplied)”



13.                 In the facts of the present case, the MOU by its very nature being

determinable, the specific performance of the same cannot be insisted upon. The




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Trial Court has not rendered any finding in respect thereof and has proceeded to

straight away grant injunction under the provisions of Order XXXIX, Rule 1 of

CPC which to my mind is an incorrect approach adopted by the Trial Court.

Considering the aforesaid facts and settled position of law, I am of the view that the

Trial Court has not correctly applied the settled principles governing grant of

temporary injunction and not given a prima facie view on the contentions as raised

by the Appellant (Original Defendant). Non granting of injunction in respect of

the property which is not in existence, would not cause any harm or loss to the

Respondent (Original Plaintiff) and balance of convenience therefore is in favour

of the Appellant (Original Defendant).

14.          I find, therefore, that the impugned order has been passed without

appreciating the facts and law and therefore, the impugned order is not sustainable

and consequently deserves to be quashed and set aside. Hence, I pass the following

order:

                                      ORDER

(i)          The impugned order dated 14th February 2025 passed by the 5 th Joint
Civil Judge, Senior Division, Pune below Exhibit-5 in Special Civil Suit No.387 of
2024 is quashed and set aside;
(ii)         The learned 5th Joint Civil Judge, Senior Division, Pune is directed to
decide the pending suit as expeditiously as possible and in accordance with law;
(iii)        The Appeal from Order stands allowed in the aforesaid terms. No costs.
(iv)         Interim Application No.4389 of 2026 does not survive and stands

disposed of.

                                                 (AARTI SATHE, J.)




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