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REPORTABLE  

IN THE SUPREME COURT OF INDIA  

CIVIL APPELLATE JURISDICTION   

CIVIL APPEAL NO. 7079   OF  2018  (Arising out of SLP (Civil) No.18465/2018)  

 Samir Narain Bhojwani         …..Appellant(s)          

:Versus:    

M/s. Aurora Properties and Investments   and Anr.               ....Respondent(s)  

J U D G M E N T  

A.M. Khanwilkar, J.  

1. The captioned appeal challenges the judgment and order  

passed by the Division Bench of the Bombay High Court dated  

9th July, 2018 in Commercial Appeal No.173 of 2017, whereby  

the Division Bench dismissed the appeal filed by the appellant  

and upheld the decision of the learned Single Judge dated 9th  

October, 2017 in Notice of Motion No.147 of 2013, wherein the  

learned Single Judge inter alia passed a mandatory

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interlocutory injunction directing the appellant to hand over 8  

(eight) flats along with 16 (sixteen) car parking spaces under  

the Settlement Agreement dated 4th November, 2016 and  

Consent Terms dated 25th September, 2017 between  

respondent Nos.1 and 2 inter partes.   

  2. The relevant facts are as follows: Respondent  

No.1/plaintiff was appointed by one Andheri Kamgar Nagar  

Cooperative Housing Society Ltd. (for short, „the Society’)  

under a Development Agreement dated 6th October, 1996 as a  

developer under the Slum Development/ Rehabilitation  

Scheme to develop the suit property in question, being a plot  

of land situated at Versova Link Road, Taluka Andheri and  

bearing Survey No. 139, City Survey No. 1319 (Part)  

admeasuring 8892 sq. mts. or thereabouts as per Indenture of  

Lease dated 31st March, 1993 and 9402 sq. mts. as per City  

Survey Records. One part of the suit property was for  

constructing tenements free of charge for project-affected  

persons and the balance property could be used to develop  

and sell the balance FSI. Respondent No.1 then executed an

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Agreement for Sub-Development dated 22nd September, 1999  

with respondent No.2/defendant No.1, transferring the  

benefits of development rights in the suit property, with the  

consent of the aforementioned Society, to respondent No.2  

after keeping aside 15,000 sq. ft. for itself i.e. respondent No.1.    

3. Subsequently, respondent No.2 executed an Agreement  

for Development dated 10th March, 2003 with the  

appellant/defendant No.2, whereunder the appellant would be  

entitled to 55% of the total area available for free sale  

buildings and car parking in the suit property and respondent  

No.2 retained 45% of the total area available for construction  

of free sale buildings and car parking by utilizing FSI which  

may be available on the suit property as per the Slum  

Rehabilitation Scheme. This agreement was entered into  

without the consent of respondent No.1 and hence, all three  

parties executed a Tripartite Agreement dated 11th September,  

2009, referencing the previous agreements of 6th October,  

1996 and 22nd September, 1999 wherein respondent No.1 was  

entitled to an area of 22,500 sq. ft., an increase from its earlier

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agreed upon 15,000 sq. ft., which would be allocated out of  

the 45% share due to respondent No. 2  

4. Disputes arose during the construction of the building,  

which resulted in respondent No.1  filing a Commercial Suit  

No. 62 of 2013 against respondent No.2 and the appellant  

inter alia seeking specific performance of the Development  

Agreement dated 22nd September, 1999, read with the  

Tripartite Agreement dated 11th September, 2009, including  

handing over constructed area of 22,500 sq. ft. in the free sale  

buildings along with proportionate car parking space, in the  

form of 12 (twelve) flats in Wings „A‟ and „B‟ of the building  

„Bay – View‟ constructed on the suit property and 24 (twenty  

four) car parking spaces. Respondent No.1 also took out Notice  

of Motion No. 147 of 2013 for interim reliefs, seeking to  

restrain respondent No.2 and the appellant from creating third  

party rights in the suit property without first handing over  

possession of the 22,500 sq. ft. constructed area in the form of  

flats and parking spaces. Respondent No. 1 alleged that this  

interim relief was necessitated by the fact that its advocate

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had conducted a search in the sub-registrar‟s office and found  

a mortgage deed executed by the appellant in favour of a third  

party with respect to 12 flats and 24 parking spaces in the  

building „Bay–View‟ and that it apprehended that the appellant  

would sell or create third party rights in respect of the said  

flats. The alleged mortgage deed itself was not produced by  

respondent No.1 on the ground that it had applied for a copy  

of the same but was yet to receive it. Respondent No.1 also  

sought to appoint a Court Receiver to take charge of the  

premises in the suit property comprising its 22,500 sq. ft.  

constructed area. An ad-interim, consent order was passed on  

3rd December, 2012, in the said Notice of Motion No. 147 of  

2013, whereby respondent No. 2 and the appellant agreed to  

not dispose of or create third party rights in respect of 8 flats  

in the completed Wings „A‟ and „B‟ of the building and 4 flats in  

the under-construction Wing „C‟ of the building, totaling 12  

flats.  

5. The parties filed their respective replies and rejoinders in  

the suit and notice of motion. The appellant‟s stance was that

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he had completed his contractual obligations and offered  

respondent No.2 its entitlement of 45% area in the constructed  

buildings but respondent No.2 had failed to take possession of  

the same. The subsequent delay in construction of Wing „C‟ of  

the building was due to the failure of respondent No.2 to  

obtain a Commencement Certificate for Wing „C‟, resulting in  

losses to the appellant. Owing to this breach committed by  

respondent No.2, it was no longer entitled to its 45% share in  

the constructed area and as a consequence, respondent No.1  

was not entitled to its 22,500 sq. ft. area which could only be  

claimed out of the respondent No.2‟s entitlement.  

 6. The appellant then took out Notice of Motion No. 540 of  

2013, seeking to refer the suit to arbitration under Section 8 of  

the Arbitration and Conciliation Act, 1996 (“the Arbitration  

Act”) and Arbitration Application No. 86 of 2013, seeking to  

appoint an arbitrator under Section 11 of the Arbitration Act.  

Both these proceedings were rejected by the High Court vide  

its order dated 30th September, 2014 on the ground that while  

the Development Agreement of 22nd September, 1999 between

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respondent Nos.1 and 2 contained an arbitration clause and  

similarly, the Agreement of 10th March, 2003 between the  

appellant and respondent No.2 also contained an arbitration  

clause, however, the Tripartite Agreement of 11th September,  

2009 itself did not contain an arbitration clause and that a  

mere reference made in the Tripartite Agreement to the  

previous agreements would not make the arbitration clauses  

therein part of the Tripartite Agreement. The appellant  

challenged that decision right upto this Court in SLP (Civil) No.  

2235 of 2015, which stood rejected.   

7. The appellant also initiated proceedings under Section 9  

of the Arbitration Act against respondent Nos.1 and 2 before  

the High Court. The High Court refused to grant any relief in  

the petition filed under Section 9 of the Arbitration Act. The  

appellant then withdrew the Section 9 proceedings and  

initiated arbitration solely against respondent No. 2 under the  

Agreement dated 10th March, 2003. In the said arbitration  

proceedings, respondent No.2 filed an application for interim  

reliefs under Section 17 of the Arbitration Act inter alia

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seeking specific performance of the agreement of 10th March,  

2003 including possession of its entire 45% share of flats in  

the buildings constructed on the suit property. Respondent  

No.2 contended that the application was necessitated by the  

fact that the appellant had violated the terms of the 10th  

March, 2003 Agreement and had created third-party rights in  

respect of his 55% entitlement in the suit property, without  

first providing respondent No.2 with the occupation and  

possession of its 45% entitlement in the suit property as set  

out in the said Agreement. Respondent No.2 also submitted  

that the appellant had deposited a refundable amount of Rs.4  

crore as part of his obligation under the Agreement but that  

refund of the said deposit was not, in any way, connected with  

handing over of the respondent No.2‟s entitlement of flats. In  

any event, respondent No.2 had offered to refund the said  

deposit in exchange for possession of the flats due to it, which  

the appellant had refused.  

   8.  By an interim order dated 12th October, 2016, the sole  

arbitrator made prima facie observations that construction of

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Wing „C‟ in the building situated on the suit property had been  

delayed owing to respondent No.2‟s failure to obtain the  

Commencement Certificate for the same. Further, respondent  

No.2 had allowed the appellant to construct only 88 flats so  

far, which worked out to 72% of the total area to be  

constructed. On that basis, the arbitrator was of the opinion  

that respondent No.2 could not receive its entire 45% share in  

the constructed area of 88 flats, which worked out to 31.6  

flats, but instead, would receive 72% of its 45% share which  

worked out to 28.5 flats. From these 28.5 flats, 12 flats were to  

be kept aside for respondent No.1 as directed in the High  

Court‟s ad-interim order dated 3rd December, 2012 and thus,  

respondent No.2 was entitled to 16.5 flats. Out of 16.5 flats,  

the appellant was directed to hand over possession of 16 flats  

to respondent No. 2, after which respondent No.2 would  

refund the deposit given by the appellant in respect of such  

flats. The remaining amount of respondent No.2‟s entitlement  

in one flat would be discharged by both respondent No.2 and  

the appellant jointly disposing of the said flat at a mutually  

agreed price.

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9. This order was challenged by the appellant, first before  

the High Court and having failed there, before this Court in  

SLP (Civil) No. 35563 of 2016. This Court, vide order dated  

14th December, 2016, refused to set aside the High Court‟s  

decision but recorded that the observations made by the sole  

arbitrator and High Court would not influence the final  

outcome of the matter.  

10. Reverting to Notice of Motion No.147 of 2013 in the suit  

filed by respondent No.1, it was then finally heard and  

judgment reserved. Pending the decision, however, respondent  

Nos. 1 and 2 filed Consent Terms dated 25th September, 2017  

according to which respondent No.2 agreed to hand over an  

additional 8 (eight) flats along with 16 (sixteen) parking spaces  

to respondent No.1 in full and final settlement of the  

Development Agreement of 22nd September, 1999 and the  

Tripartite Agreement of 11th September, 2009.   

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11. The Learned Single Judge vide decision dated 9th   

October, 2017 in Notice of Motion No.147 of 2013, relied upon  

the interim order of 12th October, 2016 passed by the sole  

arbitrator, terming it as an interim award. The Single Judge  

was of the opinion that the apportionment of flats done by the  

arbitrator had become res judicata. The arbitrator‟s finding,  

that respondent No.2 was entitled to 28.5 flats, had attained  

finality since the appeals to the High Court and this Court had  

been rejected. Further, from these 28.5 flats, 12 flats along  

with 24 parking spaces formed part of respondent No.2‟s  

entitlement, which, in turn, belonged to respondent No.1, and  

had been kept out of the scope of the arbitration since there  

was an ad-interim order of the High Court operating in that  

regard. Possession and keys of the remaining 16 flats out of  

the 28.5 flats had been handed over by the appellant to  

respondent No.2, for which the appellant‟s deposit had also  

been refunded by respondent No.2, as directed by the  

arbitrator.  

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12. The Single Judge further opined that even if respondent  

No.2 was ultimately held liable to compensate the appellant for  

damages, the same could not be recovered from the said 12  

flats as these flats were ultimately and rightfully due to  

respondent No.1 (original plaintiff) and out of bounds for the  

appellant. The Single Judge rejected the appellant‟s argument  

that since respondent No.1 claimed through respondent No.2,  

any breach by respondent No.2 would automatically affect the  

entitlement of respondent No.1 as well.  

 13. The question as to whether respondent No.2 was  

obligated to hand over possession of 8 flats to respondent No.1  

as per the settlement agreement dated 4th November, 2016  

and the Consent Terms dated 25th September, 2017 and  

whether the appellant had to hand over the keys of the said  

flats to respondent No.1, were answered by the Single Judge in  

the affirmative, with the finding that respondent No.2 was the  

rightful owner of the balance 39.6 flats, including the 8 flats,  

out of the 88 constructed flats, and that the appellant had no  

rights over the same. The point of respondent No.2 being the

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rightful owner of the 8 flats was based on the following  

aspects:   

a. Respondent No.2 alone was entitled to develop the suit  

property as the letter of intent from the SRA was in favour  

of respondent No.2;  

b. The appellant was a contractor who had been given the  

right to develop the suit property and his rights flowed  

from respondent No. 2;   

c. Respondent No.2 had retained its right to construct 45%  

of the total area available and the appellant had even  

executed a Power of Attorney (POA) in favour of  

respondent no.2 entitling respondent No.2 to execute  

agreements for sale on ownership basis, leave and license,  

etc. for the flats and car parking spaces in the suit  

property, including the said 8 flats and similarly,  

respondent No.2 had executed a POA in favour of the  

appellant allowing the appellant to dispose of his flats and  

car parking spaces which he was entitled to receive as part  

of his 55% share. This was even conceded to by the  

appellant in the arbitration proceedings and in light of the

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same, the appellant was estopped from objecting to  

respondent No.2 handing over 8 flats to respondent No.1;  

 14. On the issue of the appellant not being the owner of the  

said flats, the Single Judge recorded that merely because the  

appellant had constructed the said flats and had the keys to  

the same, he could not be said to be the owner of the flats and  

he could not prevent respondent No.2 from handing over  

possession of the 8 flats to respondent No.1. The appellant  

merely had derivative rights over the suit property, flowing  

from respondent No.1 through respondent No.2, and any  

dispute between respondent No.2 and the appellant could not,  

in any way, affect the right of respondent No.1 over the suit  

property. The Consent Terms dated 25th September, 2017  

between respondent Nos.1 and 2 clearly set out that  

respondent No.2 was obligated to hand over 8 flats to  

respondent No.1 and the right of respondent No.1 over the  

said flats was paramount to the rights of the other parties.  

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15. The Single Judge thus directed the appellant, by a  

mandatory order, to hand over keys and possession of the said  

8 flats to respondent No.1 along with 16 parking spaces,  

recording that he had moulded the reliefs originally sought by  

respondent No.1 in the changed circumstances of the case and  

in order to shorten the litigation and do complete justice.  

16. Aggrieved by the Single Judge‟s decision, the appellant  

challenged the said decision before the Division Bench of the  

High Court in Commercial Appeal No.173 of 2017. It was  

urged on behalf of the appellant that respondent Nos.1 and 2  

had entered into the Consent Terms dated 27th September,  

2017 with a view to defeat the appellant‟s claim. Unless  

respondent No.2 completed its entire obligations with respect  

to the building still under construction in the suit property,  

respondent No.1 was not entitled to receive its 8 flats as per  

the Consent Terms. The appellant further contended that the  

handing over of 8 flats to respondent No.1 was, in effect, a  

final relief since nothing further remained in the suit and the  

interim order of the Single Judge was in fact a final order and

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that the confirmation of the arbitral tribunal‟s order had no  

effect on the proceedings before the Single Judge. These  

arguments were countered by respondent No. 1 which inter  

alia submitted that the actual dispute was between the  

appellant and respondent No.2 and that it (respondent No.1)  

was being made to suffer for such dispute. Respondent No.1  

contended that the main development agreement had been  

executed between the Society and respondent No.1 and the  

rights of the other parties flowed through such agreement.  

Hence, there was nothing wrong in the Single Judge moulding  

reliefs in its favour. Respondent No.2 echoed respondent  

No.1‟s arguments.   

  17. The Division Bench by its judgment and order dated 9th  

July, 2018, upheld the mandatory direction issued by the  

Single Judge at an interlocutory stage and rejected the appeal,  

holding that the Single Judge had addressed the various  

issues in detail and that it was right to mould the reliefs, even  

at the interim stage, in light of changed circumstances in the  

case. The Division Bench opined that the appellant was not

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left remediless in case respondent No.1 failed in the suit, as  

his remedies were kept open.  

 18. We have heard Mr. Mukul Rohatgi, learned senior  

counsel appearing for the appellant, Mr. Shyam Divan, learned  

senior counsel appearing for respondent No.1 and Mr.  

Mahendra K. Ghelani, learned counsel appearing for  

respondent No.2.  

19. From the chronology of events, it is indisputable that the  

present appeal emanates from an interlocutory order passed  

by the learned Single Judge of the High Court on an  

application under Order XXXIX which, in turn, has been  

confirmed by the Division Bench. That interlocutory order has  

been passed in the suit filed by respondent No.1 against the  

appellant and respondent No.2 for the following substantive  

reliefs:  

“a) this Hon‟ble Court be pleased to declare that the suit  agreement i.e. the said Development Agreement dated 22nd  

September 1999 (Exhibit “B” to the Plaint), read with the  said Agreement dated 11th September 2009 (Exhibit “J” to  the plaint), are valid, subsisting and binding between the  

Plaintiff and the Defendants.  

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b) this Hon‟ble Court be pleased to order and decree the  specific performance of the suit agreements dated 22nd  

September 1999 (Exhibit “B” to the plaint), read with  Agreement dated 11th September 2009 (Exhibit “J” to the  

plaint) including handing over to the Plaintiff constructed  area of 22500 sq.ft. in the free sale buildings along with  proportionate car parking space in the form of 12 flats in  

Wings “A” and “B” of the building “Bay –View” situated on  the property described in Exhibit “A” to the plaint and 24 car  parking spaces.   

c) In the alternative to prayer clause (b) this Hon‟ble  

Court be pleased to order, decree and direct the Defendants  to refund a sum of Rs.75,00,000/- together with interest at  18% as set out in the Particulars of Claim at Exhibit “M” to  

the plaint;  

d) In the alternative to prayer (a) and (b) and in addition  

to prayer (c) above, this Hon‟ble Court be pleased order,  decree and direct the Defendants to pay damages of  

Rs.173,47,53,425/- (Rupees One Hundred Seventy Three  Crores Forty Seven Lacs Fifty Three Thousand Four Hundred  Twenty Five Only) as set out in particulars of Claim at  

Exhibit “M” to the plaint.  

e) This Hon‟ble Court be pleased to pass an order of  

Mandatory and Permanent Injunction against the  Defendants, their servants, agents, assigns and/or any other  

person acting through or under them from in any manner  directly or indirectly dealing with or disposing of or  alienating or parting with the possession of or creating third  

party rights in respect of the premises coming to the share of  the Defendants in Wings ”A” & “B” of the building “Bay-View”  situated on the property described in Exhibit “A” to the  

plaint without first delivering to the Plaintiff, the possession  of 22500 sq.ft. constructed areas per SRA sanctioned plan  

with proportionate car parking space in the form of 12 flats  in Wings “A” and “B” of the building “Bay –View” situated on  the property described in Exhibit “A” to the plaint and 24 car  

parking spaces.”  

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20. During the pendency of the suit for aforementioned  

reliefs, respondent No.1/plaintiff filed Notice of Motion  

No.147/2013 for the following interim reliefs:    

“(a) Pending the hearing and final disposal of the present  suit, this Hon‟ble Court be pleased to injunct the  Defendants, servants, agents, assigns and/or any other  

persons acting through or under them from in any manner  directly or indirectly dealing with or disposing of or  alienating or parting with the possession of or creating third  

party rights in respect of the premises coming to the share of  the Defendants in Wings “A” & “B” of the building “Bay-View”  

situated on the property described in Exhibit “A” to the  Plaint without first delivering to the Plaintiff, the possession  of 22500 sq.ft. constructed areas per SRA sanctioned plan  

with proportionate car parking space in the form of 12 flats  in Wings “A” and “B” of the building “Bay-View” situated on  the property described in Exhibit “A” to the plaint and 24 car  

parking spaces.  

(b) Pending the hearing and final disposal of the present suit,  this Hon‟ble Court be pleased to appoint Court Receiver,  High Court, Bombay and/or such other fit and proper  

person as Receiver of premises coming to the share of the  Defendant No.1 in Wings “A” & “B” of the building “Bay- View” situated on the property described in the Exhibit “A” to  

the Plaint with all powers under Order XL Rule 1 of the Code  of Civil Procedure Code 1908 including the power to take  

possession of premises coming to the share of the Defendant  No.1 in Wings “A” and “B” of the building “Bay-View”  situated on the property described in the Exhibit “A” to the  

plaint and hand over to the Plaintiff the possession of  constructed area as per SRA sanctioned plan in the free sale  

building in the form of 12 flats in Wings “A” and “B” of the  building “Bay-View” situated on the property described in  Exhibit “A” to the Plaint and 24 car parking spaces.  

(c)  ad interim reliefs in terms of prayer (a) & (b).  

(d) for costs of the suit;

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(e) for such further and other reliefs as this Hon‟ble Court  

may deem fit and proper in the nature and circumstances of  

the case.”  

21. Indeed, the learned Single Judge of the High Court  

granted ad-interim relief on 3rd December, 2012 during the  

pendency of the Notice of Motion. The same reads thus:  

“Heard the Learned Senior Advocates appearing for the  

parties. The following order is passed by consent without  going into the merits of the case and keeping all the  contentions of the parties open.   

(i) The Defendants shall not sell, dispose of, alienate,  

encumber, part with possession and/or create third party  rights in respect of 4 flats in Wing  “A” and 4 flats in Wing  “B” which flats are already constructed and occupation  

certificate is obtained in respect of the same. The said 8 flats  are identified on the sanctioned plan which is taken on  

record and marked “X” for identification.   (ii) The Defendants shall also not sell, dispose of, alienate,  encumber, part with possession and/or create third party  

rights in respect of 4 flats in Wing “C”, the construction of  which is in progress. The said four flats are identified on the  plan tendered in Court and marked “X”.  

(iii) It is clarified that the above 12 flats pertain to 45 per  cent share in flats of Defendant No.1 as per the agreements  

entered into by and between Defendant Nos.1 and 2. The  Defendant No.2 has informed the Court that Defendant No.2  will be contending that Defendant No.1 is not entitled to  

their 45 per cent share in the flats so constructed on the  ground that Defendant No.1 has allegedly not complied with  their obligations under the Agreements.  

(iv) The Defendants shall also not sell, dispose of, alienate,  encumber, part with possession and/or create third party  

rights in respect of the proportionate car parking spaces in  respect of the above 12 flats also identified on the plan  marked “X”.  

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2. Place the above Notice of Motion along with Notice of  Motion (L) NO.3338 of 2012 taken out by Defendant No.2  

under Section 8 of the Arbitration and Conciliation Act, 1996  for hearing and final disposal on 15th January, 2013.”  

The aforementioned order was corrected on 17th December,  

2012 in the following terms:  

“This application is for speaking to the minutes of the order  

dated 3rd December, 2012.  

2. In clause (i), 4 flats in Wing “A” and 4 flats in Wing “B” be  read as 5 flats in Wing “A” and 3 flats in Wing “B”.  

Application is accordingly disposed of.”  

 22. The said  ad-interim arrangement continued during the  

pendency of Notice of Motion.  However, while finally disposing  

of the Notice of Motion No. 147/2013,  the learned Single  

Judge of the High Court vide judgment and order dated 9th  

October, 2017 passed a mandatory order directing the  

appellant to hand over 8 flats and 16 parking spaces to  

respondent No.1/plaintiff. For passing such mandatory order  

the learned Single Judge placed reliance on the decision of  

this Court in Gaiv Dinshaw Irani and Others Versus

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Tehmtan Irani and Others1, holding that the Courts ought to  

mould the relief in accordance with the changed  

circumstances for trying the litigation or to do complete  

justice. The view so taken by the learned Single Judge  

commended to the Division Bench.  

  23. What has, however, been glossed over by the High Court  

is that the Settlement Agreement dated 4th November, 2016  

and the Consent Terms dated 29th September, 2017 have been  

entered into between the respondent No.1/plaintiff and  

respondent No.2/defendant No.1 inter partes. That could not  

be thrust upon the appellant/defendant No.2 who had  

executed a separate agreement with respondent  

No.2/defendant No.1.  The appellant could be bound only by  

the agreement dated 10 March, 2003 in his favour and  

executed by him.  Admittedly, the said agreement is the  

subject matter of arbitration proceedings, inter alia because  

respondent No.2 had failed to discharge its obligation  

thereunder. The appellant has already parted with the  

                                                           1   (2014) 8 SCC 294

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possession of flats to respondent No.2 in furtherance of  

agreement dated 10th March, 2003 and respondent  

No.1/plaintiff could be accommodated only against those flats.   

Asking the appellant to hand over additional 8 flats and 16  

parking spaces by way of mandatory order, would be to  

superimpose the liability of respondent No.2/defendant No.1  

on the appellant for discharging its obligation qua respondent  

No.1/plaintiff  in relation to the agreement entered between  

them dated 22nd September, 1999 and including Settlement  

Agreement dated 4th November, 2016 and Consent Terms  

dated 25th September, 2017, to which the appellant is not a  

party.   

 24. That apart, the learned Single Judge as well as the  

Division Bench have committed fundamental error in applying  

the principle of moulding of relief which could at best be  

resorted to at the time of consideration of final relief in the  

main suit and not at an interlocutory stage. The nature of  

order passed against the appellant is undeniably a mandatory  

order at an interlocutory stage. There is marked distinction

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between moulding of relief and granting mandatory relief at an  

interlocutory stage. As regards the latter, that can be granted  

only to restore the status quo and not to establish a new set of  

things differing from the state which existed at the date when  

the suit was instituted. This Court in Dorab Cawasji Warden  

Versus Coomi Sorab Warden and Others,2 has had occasion  

to consider the circumstances warranting grant of  

interlocutory mandatory injunction. In paragraphs 16 & 17,  

after analysing the legal precedents on the point as noticed in  

paragraphs 11-15, the Court went on to observe as follows:  

“16. The relief of interlocutory mandatory injunctions  are thus granted generally to preserve or restore the  

status quo of the last non-contested status which  preceded the pending controversy until the final hearing  when full relief may be granted or to compel the undoing  

of those acts that have been illegally done or the  restoration of that which was wrongfully taken from the  

party complaining. But since the granting of such an  injunction to a party who fails or would fail to establish his  right at the trial may cause great injustice or irreparable  

harm to the party against whom it was granted or  alternatively not granting of it to a party who succeeds or  would succeed may equally cause great injustice or  

irreparable harm, courts have evolved certain guidelines.  Generally stated these guidelines are:  

(1) The plaintiff has a strong case for trial. That is,  it shall be of a higher standard than a prima facie case that  is normally required for a prohibitory injunction.  

                                                           2   (1990) 2 SCC 117

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(2) It is necessary to prevent irreparable or serious  injury which normally cannot be compensated in terms of  

money.  

(3) The balance of convenience is in favour of the  one seeking such relief.  

17. Being essentially an equitable relief the grant or refusal  of an interlocutory mandatory injunction shall ultimately  rest in the sound judicial discretion of the court to be  exercised in the light of the facts and circumstances in each  

case. Though the above guidelines are neither exhaustive nor  complete or absolute rules, and there may be exceptional  

circumstances needing action, applying them as prerequisite  for the grant or refusal of such injunctions would be a sound  exercise of a judicial discretion.”  

                                                         (emphasis supplied)  

25. The Court, amongst others, rested its exposition on the   

dictum in Halsbury‟s Laws of England, 4th edition, Volume 24,  

paragraph 948, which reads thus:   

“A mandatory injunction can be granted on an interlocutory  application as well as at the hearing, but, in the absence of  

special circumstances, it will not normally be granted.  However, if the case is clear and one which the court thinks  

ought to be decided at once, or if the act done is a simple  and summary one which can be easily remedied, or if the  defendant attempts to steal a march on the plaintiff, such as  

where, on receipt of notice that an injunction is about to be  applied for, the defendant hurries on the work in respect of  

which complaint is made so that when he receives notice of  an interim injunction it is completed, a mandatory  injunction will be granted on an interlocutory application.”  

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26. The principle expounded in this decision has been  

consistently followed by this Court. It is well established that  

an interim mandatory injunction is not a remedy that is easily  

granted. It is an order that is passed only in circumstances  

which are clear and the prima facie material clearly justify a  

finding that the status quo has been altered by one of the  

parties to the litigation and the interests of justice demanded  

that the status quo ante be restored by way of an interim  

mandatory injunction. (See Metro Marins and Another  

Versus Bonus Watch Co. (P) Ltd. and Others3, Kishore  

Kumar Khaitan and Another Versus Praveen Kumar  

Singh4 and Purshottam Vishandas Raheja and Another  

Versus Shrichand Vishandas Raheja (Dead) through LRS.  

and Others5)   

 27. In the factual scenario in which mandatory order has  

been passed against the appellant, in our opinion, is in excess  

of jurisdiction.  Such a drastic order at an interlocutory stage  

ought to be eschewed. It cannot be countenanced.                                                                3 (2004) 7 SCC 478  4 (2006) 3 SCC 312  5 (2011) 6 SCC 73

27    

 28. Reverting to the decision in Gaiv Dinshaw Irani,  

(supra), relied upon by the High Court, the Court moulded the  

relief in favour of the party to the proceedings to do  

substantial justice whilst finally disposing of the proceedings  

and did not do so at an interlocutory stage. In other words,  

reliance placed on the principle of moulding of relief is  

inapposite to the fact situation of the present case.   

29. Resultantly, the invocation of principle of moulding of  

reliefs so also the exercise of power to grant mandatory order  

at an interlocutory stage, is manifestly wrong. To put it  

differently, while analysing the merits of the contentions the  

High Court was swayed away by the consent agreement  

between the respondents inter partes to which the appellant  

was not a party. Thus, he could not be bound by the  

arrangement agreed upon between the respondents inter se.  

The appellant would be bound only by the agreement entered  

with respondent No.2 dated 10th March, 2003 and at best the  

tripartite agreement dated 11th September, 2009. The  

respondent No.2 having failed to discharge its obligation under

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the stated agreement dated 10th March, 2003, cannot be  

permitted to take advantage of its own wrong in reference to  

the arrangement agreed upon by it with respondent  

No.1/plaintiff and including to defeat the claim of the  

appellant in the arbitration proceedings.   

30. It would have been a different matter if the High Court  

were to continue the ad-interim arrangement directed in terms  

of order dated 3rd December, 2012 and as corrected on 17th  

December, 2012, until the final disposal of the suit. However,  

by no stretch of imagination, the appellant could be directed to  

hand over 8 additional flats and 16 parking spaces to  

respondent No.1 with whom the appellant has had no  

independent agreement in that regard. The fact that  

respondent No.1 would get a right in the suit property in terms  

of agreement dated 22nd September, 1999, Settlement  

Agreement dated 4th November, 2016 and Consent Terms  

dated 25th September, 2017 with respondent No.2, cannot be  

the basis to set up a claim against the appellant and,  

especially because complying with the directions in the

29    

impugned order would result in bestowing  advantage on  

respondent No.2 who has failed to discharge its obligation  

under the agreement dated 10th March, 2003 with the  

appellant.   

 31. In view of the above, we have no hesitation to conclude  

that the High Court committed manifest error and  exceeded  

its jurisdiction in granting interlocutory mandatory injunction  

against the appellant.   

32. Accordingly, the impugned judgment and order passed  

by the High Court deserves to be set aside but while doing so,  

we deem it appropriate to revive the ad-interim order passed  

by the Single Judge of the High Court on 3rd December, 2012  

in Notice of Motion No.147/2013 and as corrected on 17th  

December, 2012,  which shall operate until the disposal of the  

suit or until it is modified by the High Court on account of  

subsequent developments, if any, as and when occasion  

arises.   

30    

33. While parting, we make it clear that the observations  

made in this judgment are only for considering the matter in  

issue under consideration and shall not influence the  

substantive proceedings pending between the parties.  The  

same be decided on its own merits.   

34. The appeal is allowed in the aforementioned terms. No  

costs.  

.………………………….CJI.        (Dipak Misra)   

…………………………..….J.                (A.M. Khanwilkar)  

…………………………..….J.               (Dr. D.Y. Chandrachud)  

New Delhi;  

August 21, 2018.