# PAWAN KUMAR ARYA AND OTHERS v. RAVI KUMAR ARYA AND OTHERS

- **Citation:** [2020] 4 S.C.R. 770
- **Court:** Supreme Court of India
- **Decided:** 2020-03-02
- **Case number:** Civil Appeal Nos. 945-946 of 2020
- **Bench:** Ashok Bhushan, M. R. Shah
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/pawan-kumar-arya-and-others-v-ravi-kumar-arya-and-others-34143
- **Pages:** 24

## Headnote

Suit - Relief against the transfer of property - Execution of
consent decree - The dispute was with respect to a property - The
dispute was between the appellants- original plaintiffs (PA Group)
and respondent nos. 1 to 6-original defendant nos. 1 to 6 (RA Group)
and also between original defendant no. 10-Developer/Builder -
The disputed property was of K.F. Pvt. Ltd. - In the said Company,
25% of the shareholding was with M.P. Recycling Company (Jointly
held by plaintiffs and defendants nos. 1 to 6) and the remaining
75% of the shareholding with defendants nos. 1 to 6 in their
individual capacities - According to the plaintiffs, defendants nos.
1 to 6 entered into a purported Development Agreement with
defendant no. 10, to develop the disputed property behind the back
of plaintiffs - As per plaintiffs, the defendants nos. 1 to 6 received
Rs. 45 crores from the developer and 15 flats & 72 car parking
spaces under the development agreement - According to the
plaintiffs, the defendant nos. 1 to 6 did not give any rights/ benefits
in the said property to them - This led to the filing of the suit -
During the pendency of the suit, the suit came to be settled and it
was disposed of in accordance of the consent terms - As per
plaintiffs, the developer had in accordance with the consent terms
executed the letter of allotment in 'Annexure E' in respect of the 8
apartments, which were to fall in the share of the plaintiffs, but
defendant nos. 1 to 6 refused to abide by the consent terms and
counter-sign the letter of allotment as per 'Annexure E' - The plaintiff
initiated proceedings for the execution of the consent decree viz.
for execution of the document at 'Annexure E' - The execution
application was rejected by the Single Judge of the High court and
it was observed that unless and until the supplementary consent
terms are entered into between the parties, there is no obligation on
the part of defendant nos. 1 to 6 to execute the letter of allotment in
the form of 'Annexure E' - The Division Bench of the High Court
[2020] 4 S.C.R. 770
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confirmed the judgment and order passed by the Single Judge of
the High Court - On appeal, held: From the consent terms, it appears
that both the parties - PA Group and RA Group decided to resolve
and settle the other disputes also i.e. the other larger companies
and its constituents - The entire consent terms/ consent decree is
required to be acted upon and/ or implemented by both the parties
otherwise, the object and purpose to resolve all the disputes will be
frustrated - Thus, there cannot be any execution of partial consent
terms/ consent decree - Also, the further execution of supplemental
consent terms/ family arrangement is required to be executed between
the parties, considering the relevant terms of settlement - The both
Single Judge as well the Division Bench were justified in holding
that the execution of the further supplemental consent terms/ family
arrangement is must - Therefore, both the parties directed to fully
comply with the consent terms/ consent decree and enter into the
further supplemental consent terms/ family arrangement after
following the modalities with respect to valuation, bidding etc. -
Also, RA Group to counter-sign 'Annexure E' letter with respect to 8
flats as per list at 'Annexure A' to the consent terms for which the
developer had issued letter - However, it is further directed that till
the consent terms/consent decree is fully implemented by both the
parties and the supplemental consent terms/family arrangement is
entered into/executed, the PA Group shall not alienate in any manner
the said 8 flats.
Disposing of the appeals, the Court
HELD: 1. Having heard the respective parties and
considering the relevant terms of the settlement, this Court is of
the opinion that further execution of supplemental consent terms/
family arrangement is required to be executed between the
parties. For whatever reasons, the further supplemental consent
term

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SUPREME COURT REPORTS
[2020] 4 S.C.R.
PAWAN KUMAR ARYA AND OTHERS
v.
RAVI KUMAR ARYA AND OTHERS
(Civil Appeal Nos. 945-946 of 2020)
MARCH 02, 2020
[ASHOK BHUSHAN AND M. R. SHAH, JJ.]
Suit - Relief against the transfer of property - Execution of
consent decree - The dispute was with respect to a property - The
dispute was between the appellants- original plaintiffs (PA Group)
and respondent nos. 1 to 6-original defendant nos. 1 to 6 (RA Group)
and also between original defendant no. 10-Developer/Builder -
The disputed property was of K.F. Pvt. Ltd. - In the said Company,
25% of the shareholding was with M.P. Recycling Company (Jointly
held by plaintiffs and defendants nos. 1 to 6) and the remaining
75% of the shareholding with defendants nos. 1 to 6 in their
individual capacities - According to the plaintiffs, defendants nos.
1 to 6 entered into a purported Development Agreement with
defendant no. 10, to develop the disputed property behind the back
of plaintiffs - As per plaintiffs, the defendants nos. 1 to 6 received
Rs. 45 crores from the developer and 15 flats & 72 car parking
spaces under the development agreement - According to the
plaintiffs, the defendant nos. 1 to 6 did not give any rights/ benefits
in the said property to them - This led to the filing of the suit -
During the pendency of the suit, the suit came to be settled and it
was disposed of in accordance of the consent terms - As per
plaintiffs, the developer had in accordance with the consent terms
executed the letter of allotment in 'Annexure E' in respect of the 8
apartments, which were to fall in the share of the plaintiffs, but
defendant nos. 1 to 6 refused to abide by the consent terms and
counter-sign the letter of allotment as per 'Annexure E' - The plaintiff
initiated proceedings for the execution of the consent decree viz.
for execution of the document at 'Annexure E' - The execution
application was rejected by the Single Judge of the High court and
it was observed that unless and until the supplementary consent
terms are entered into between the parties, there is no obligation on
the part of defendant nos. 1 to 6 to execute the letter of allotment in
the form of 'Annexure E' - The Division Bench of the High Court
[2020] 4 S.C.R. 770
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confirmed the judgment and order passed by the Single Judge of
the High Court - On appeal, held: From the consent terms, it appears
that both the parties - PA Group and RA Group decided to resolve
and settle the other disputes also i.e. the other larger companies
and its constituents - The entire consent terms/ consent decree is
required to be acted upon and/ or implemented by both the parties
otherwise, the object and purpose to resolve all the disputes will be
frustrated - Thus, there cannot be any execution of partial consent
terms/ consent decree - Also, the further execution of supplemental
consent terms/ family arrangement is required to be executed between
the parties, considering the relevant terms of settlement - The both
Single Judge as well the Division Bench were justified in holding
that the execution of the further supplemental consent terms/ family
arrangement is must - Therefore, both the parties directed to fully
comply with the consent terms/ consent decree and enter into the
further supplemental consent terms/ family arrangement after
following the modalities with respect to valuation, bidding etc. -
Also, RA Group to counter-sign 'Annexure E' letter with respect to 8
flats as per list at 'Annexure A' to the consent terms for which the
developer had issued letter - However, it is further directed that till
the consent terms/consent decree is fully implemented by both the
parties and the supplemental consent terms/family arrangement is
entered into/executed, the PA Group shall not alienate in any manner
the said 8 flats.
Disposing of the appeals, the Court
HELD: 1. Having heard the respective parties and
considering the relevant terms of the settlement, this Court is of
the opinion that further execution of supplemental consent terms/
family arrangement is required to be executed between the
parties. For whatever reasons, the further supplemental consent
terms have not been entered into between the parties. Therefore,
as such, considering the fact that the parties entered into the
consent terms/settlement for a complete parting of ways between
the parties and so aimed at bringing about an eventual complete
quietus to the disputes between the parties and even parties
entered into the consent terms/settlement to resolve and settle
the disputes in relation to the subject matter of AISCO, IMTC,
Kash Foods, Orbit Arya Commercial Premises and the disputes
PAWAN KUMAR ARYA v. RAVI KUMAR ARYA
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in relation to the larger Arya Group of Companies and its
constituents, which were beyond the dispute in the civil suit,
the entire consent terms/consent decree is required to be acted
upon and/or implemented by both the parties. There cannot be
any execution of partial consent terms/consent decree. If the
submission on behalf of the plaintiffs is accepted and the 8 flats
as per list at 'Annexure A' are transferred absolutely and without
any condition in favour of PA Group without there being any further
supplemental consent terms/family arrangement, in that case, the
entire object and purpose of entering into the consent terms/
settlement to resolve all the disputes between the parties will be
frustrated. Both the parties to the consent terms/consent decree
are required to fully comply with the terms of settlement/the
consent terms and the consent decree. One party cannot be
permitted to say that that portion of the settlement which is in
their favour be executed and/or complied with and not the other
terms of the settlement/consent terms/consent decree. Under
the circumstances, as such, both, the Single Judge as well as the
Division Bench of the High Court are justified in holding that the
execution of the further supplemental consent terms/family
arrangement is must and there cannot be any partial execution of
the consent terms/consent decree.[Para 6][789 G-H; 790 A-F]
2. Even in the case of Hari Shankar Singhania, the decision
which has been relied upon by the appellants, this Court has
observed that a family settlement is treated differently from any
other formal commercial settlement as such settlement in the
eye of the law ensures peace and goodwill among the family
members. It is further observed that technicalities should not be
put at risk of the implementation of a settlement drawn by a family,
which is essential for maintaining peace and harmony in a family.
It is further observed that it is the duty of the court that such an
arrangement and the terms thereof should be given effect to in
letter and spirit. [Para 7][790 F-H]
3. On a conjoint reading of all the terms of the settlement,
it can be said that there is an implied term that both the parties
have intended that on one hand as agreed between the parties
further supplemental consent terms/family arrangement is to be
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entered into and on the other hand there shall be transfer/
allotment of 8 flats as per list at 'Annexure A' in favour of PA
Group. Any other interpretation would lead to unworking of the
consent terms/consent decree. As observed hereinabove, if the
consent decree is partially executed and the other parts of the
consent terms are not implemented and/or acted upon, the object
and purpose to resolve all the disputes amicably between the
parties and to put an end to all the disputes between the parties
will be frustrated. [Para 8.1][791 D-F]
4. However, at the same time, one cannot lose sight of the
fact that the 8 flats as per list at 'Annexure A' are allotted in
favour of PA Group and rest of the 7 flats as per list at 'Annexure
B' are allotted in favour of RA Group. At present, the RA Group
is in possession of all the 15 flats. The RA Group is also the
beneficiary of Rs.45 crores. Therefore, to strike the balance
between the parties, the RA Group can be directed to countersign 'Annexure E' letter issued by the Builders with respect to 8
flats as per list at 'Annexure A' which are allotted in favour of PA
Group. However, with a caveat that till the further supplemental
consent terms/family arrangement as agreed between the parties
under the consent terms/consent decree is not executed, PA
Group may not be permitted to sell, transfer and/or deal with the
said flats till the consent terms/consent decree is fully acted upon
and implemented between the parties. At the same time, both
the parties are required to be directed to fully implement the
consent terms/consent decree and to enter into further
supplemental consent terms/family arrangement, the modalities
of which are mentioned in the consent terms itself, at the earliest
and within a reasonable time. Until then, both the parties to abide
as per the Restraint order as per clause 22 of the consent terms,
except the 7 flats as per list at 'Annexure B', which are allotted
in favour of RA Group. [Para 9][791-F-H; 792-A-C]
5. The impugned judgment and order passed by the Division
Bench of the High Court and that of the Single Judge are hereby
modified as under: i) Both the parties - PA Group & RA Group
are directed to fully comply with the consent terms/consent decree
PAWAN KUMAR ARYA v. RAVI KUMAR ARYA
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and enter into the further supplemental consent terms/family
arrangement after following the modalities to be worked out with
respect to valuation, bidding etc. as mentioned in the consent
terms itself. Both the parties are directed to cooperate to fully
comply with the consent terms/consent decree and fulfil their
respective part of obligation under the consent terms/consent
decree; ii) that the RA Group shall counter-sign 'Annexure E'
letter with respect to 8 flats as per list at 'Annexure A' to the
consent terms for which the original defendant no.10 - Builder
had already issued a letter. However, it is directed that till the
consent terms/consent decree is fully implemented by both the
parties and further supplemental consent terms/family
arrangement, as ordered hereinabove, is entered into/executed,
the PA Group shall not alienate and/or transfer in any manner
whatsoever the said 8 flats. At the same time, it will be open for
original defendant nos. 1 to 6 - RA Group to deal with the 7 flats
as per list at 'Annexure B' which are allotted to them. At the
same time, both the parties to act as per the Restraint order as
per clause 22 of the consent terms. The original injunction granted
by the Single Judge which has been continued till date is directed
to be continued till the execution of the further supplemental
consent terms/family arrangement except the 7 flats as per the
list at 'Annexure B' which are allotted in favour of RA Group.
[Para 10][792 B-H]
Saradamani Kandappan v. S. Rajalakshmi & Ors.
(2011) 12 SCC 18 : [2011] 8 SCR 874 - not applicable.
Manish Mohan Sharma & Ors. v. Ram Bahadur Thakur
Ltd. & Ors (2006) 4 SCC 416 : [2006] 3 SCR 97 ; Kale
& Ors. v. Deputy Director of Consolidation & Ors.
(1976) 3 SCC 119 : [1976] 3 SCR 202 ; Satya Jain &
Ors. v. Anis Ahmed Rushdie & Ors. (2013) 8 SCC 131:
[2013] 3 SCR 319 ; Hari Shankar Singhania & Ors. v.
Gaur Hari Singhania & Ors. (2006) 4 SCC 658 : [2006]
3 SCR 726 - referred to.
Case Law Reference
[2006] 3 SCR 97
referred to
Para 3.2
[1976] 3 SCR 202
referred to
Para 3.2
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[2013] 3 SCR 319
referred to
Para 3.6
[2011] 8 SCR 874
not applicable
Para 3.8
[2006] 3 SCR 726
referred to
Para 3.10
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 945946 of 2020.
From the Judgment and Order dated 21.12.2017 of the High Court
of Judicature at Bombay in Appeal (L) No. 447 of 2017 with Notice of
Motion (L) No. 2541 of 2017 in Appeal (L) No. 447 of 2017.
Dr. A.M. Singhvi, Mr. Dhruv Mehta, Sr. Advs., Ms. Alya Khan,
Vivek A. Vashi, Advs. for the Appellants.
Shyam Divan, Haresh M. Jagtiani, Sr. Advs., Bhargava V. Desai,
Ms. Apurva Manwani, Rahul Gupta, Advs. for the Respondents.
The Judgment of the Court was delivered by:
M. R. SHAH, J.
1. Feeling aggrieved and dissatisfied with the impugned judgment
and order dated 21.12.2017 passed by the High Court of Judicature at
Bombay in Appeal (L) No. 447 of 2017 with Notice of Motion (L) No.
2541 of 2017 in Appeal (L) No. 447 of 2017, by which the Division
Bench of the High Court has dismissed the said intra court appeal
preferred by the appellants herein - original plaintiffs and has confirmed
the judgment and order passed by the learned Single Judge dated
30.11.2017 dismissing the execution petition, the original plaintiffs - decree
holders have preferred the present appeals.
2. The dispute is between the appellants herein - original plaintiffs
(hereinafter referred to as 'PAGroup') and respondent nos. 1 to 6 herein
- original defendant nos. 1 to 6 (hereinafter referred to as 'RAGroup')
and also between original defendant no. 10 - Omkar Realtors and
Developers Private Limited (hereinafter referred to as 'Omkar Builders').
The dispute was with respect to the asset of Kash Foods Private Limited
admeasuring 4134 square meters plot at Worli, Mumbai.
2.1 That the appellants herein - original plaintiffs filed a Suit (L)
No. 194 of 2015 against the respondents herein/original defendants
seeking the relief against the transfer of the property of Kash Foods
Private Limited in favour of respondent no.10 herein - defendant no. 10
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- Omkar Developers. As observed hereinabove, the original plaintiffs
Pawan Kumar Arya and others belong to PA Group and original
defendant nos. 1 to 6 belong to RA Group, the brother of Pawan Kumar
Arya. According to the original plaintiffs, original defendant no.7 - M.P.
Recycling Company was jointly held by PA Group and RA Group with
each credit or holding 50% of its shareholding. That M.P. Recycling
held 25% of shareholding in Kash Foods. That Kash Foods owned a plot
of land at Worli admeasuring about 4134.27 sq, meters. That 25% of the
shareholding in Kash Foods was purchased by M.P. Recycling and the
remaining 75% of the shareholding in Kash Foods was bought by
RAGroup in 2011 in their individual capacities.
2.2 That by conveyance deed dated 22.12.2012, a portion of the
assets of Kash Foods was transferred to original defendant nos. 3 & 4
that are the members of the RA Group. A development agreement was
executed between Omkar Builders - original defendant no.10, Kash
Foods, original defendant no. 8 and defendant nos. 3 and 4, which was
subjected to challenge by the plaintiffs in the suit. According to the original
plaintiffs, original defendant nos. 1 to 6 in violation of the Right of First
refusal clause in favour of M.P. Recycling to buy shares of Kash Foods
as contained in the Articles of Association of Kash Foods, surreptitiously
and behind the back of the plaintiffs bought 75% outsiders' shareholding
in the names of defendant no.1's family. According to the plaintiffs,
defendant nos. 1 to 6 entered into a purported Development Agreement
dated 10.04.2013 with Omkar Builders, a third party developer, to develop
the Worli property behind the back of M.P. Recycling and the plaintiffs.
According to the plaintiffs, under the purported Development Agreement
with Omkar Builders, defendant nos. 1 to 6 and Kash Foods received
Rs. 25 crores from Omkar Builders and an additional Rs. 20 crores as
security. That as per the case of the plaintiffs, defendant nos. 1 to 6 and
Kash Foods also received 79,000 sq. ft. carpet area, i.e., 15 flats and 72
car parking spaces from Omkar Builders under the Development
Agreement. According to the plaintiffs, 15 agreements for sale were
registered and executed in favour of defendant nos. 1 to 6 and Kash
Foods.
2.3 According to the plaintiffs, defendant nos. 1 to 6 did not give
any rights/benefits in the said consideration/carpet area received from
Omkar Builders either to the plaintiffs and/or to M.P. Recycling. The
aforesaid led to the filing of the suit by the plaintiffs against original
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defendant nos. 1 to 6 seeking a 50-50 division of the benefits received
by Kash Foods under the Development Agreement with Omkar Builders.
That during the pendency of the suit, the suit came to be settled and the
aforesaid suit came to be disposed of in accordance of the consent terms.
As per the consent terms, out of 15 apartments that were to come up on
the Worli land, 8 apartments admeasuring 27000 sq. meters in all were
to fall to the share of the plaintiffs- PAGroup and 7 apartments with a
total area of 52000 sq. meters were to go to defendant nos. 1 to 6- RA
Group. According to the plaintiffs, as per the consent terms, the letter of
allotment of their 8 apartments was liable to be executed by defendant
no. 10 - Omkar Builders and the same was liable to be counter-signed
by defendant nos. 1 to 6- RAGroup. According to the plaintiffs, defendant
no. 10 - Omkar Builders had in accordance with the consent terms
executed the letter of allotment in 'Annexure E' in respect of the 8
apartments, but defendant nos. 1 to 6 refused to abide by the consent
terms and counter-sign the letter of allotment as per 'Annexure E'.
2.4 Therefore, in view of the refusal on the part of defendant nos.
1 to 6 - RA Group to abide by the consent terms and counter-sign the
letter of allotment as per 'Annexure E', the plaintiffs initiated the
proceedings under Order 21 Rule 34 of the Code of Civil Procedure for
the execution of the consent decree viz. for execution of the document
at 'Annexure E' to decree dated 14.08.2015, by defendant nos. 1 to 6 -
RA Group and defendant no. 10 - Omkar Builders jointly and/or severally.
The execution application came to be rejected by the learned Single
Judge by the judgment and order dated 30.11.2017 by holding that neither
Omkar Builders nor defendant nos. 1 to 6 - RA Group could have been
directed at this stage to execute 'Annexure E' to the consent terms nor
could the RA Group be restrained from dealing with the properties that
form the subject matter of Kash Foods property. The learned Single
Judge also observed that unless and until the supplementary consent
terms are entered into between the parties, there is no obligation on the
part of defendant nos. 1 to 6 to execute the letter of allotment in the
form of 'Annexure E'.
2.5 Feeling aggrieved by the dismissal of the Chamber Summons/
Execution Petition, the appellants herein preferred appeal before the
Division Bench. That by the impugned judgment and order, the Division
Bench of the High Court has dismissed the said appeal and has confirmed
the judgment and order passed by the learned Single Judge dated
PAWAN KUMAR ARYA v. RAVI KUMAR ARYA
[M. R. SHAH, J.]
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30.11.2017 dismissing the chamber summons/execution petition. That
while dismissing the chamber summons, the learned Single Judge as
well as while dismissing the appeal, the Division Bench has observed
that no direction against the RA Group to execute the letter of allotment
in the form of 'Annexure E' can be issued on the basis of clause 28 of
the consent terms relied upon by the plaintiffs as there is nothing in
clause 28 of the consent terms that casts an obligation upon defendant
nos. 1 to 6 - RA Group to execute the letter of allotment in the form of
'Annexure E'.
2.6 Feeling aggrieved and dissatisfied with the impugned judgment
and order passed by the Division Bench of the High Court dismissing
the appeal, confirming the judgment and order passed by the learned
Single Judge dismissing the chamber summons/execution petition and
refusing to issue any direction against defendant nos. 1 to 6 - RA Group
to execute the letter of allotment in the form of 'Annexure E' with respect
to 8 apartments, the original plaintiffs have preferred the present appeals.
3. Dr. Abhishek Manu Singhvi and Shri Dhruv Mehta, learned
Senior Advocates have appeared on behalf of the appellants herein -
original plaintiffs and Shri Shyam Divan and Shri Haresh Jagtiani, learned
Senior Advocates have appeared on behalf of the respondents herein -
original defendants.
3.1 Dr.Singhvi, learned Senior Advocate appearing on behalf of
the appellants - original plaintiffs has vehemently submitted that in the
facts and circumstances of the case, both, the learned Single Judge as
well as the Division Bench have materially erred in dismissing the notice
of motion and not issuing the directions as prayed against original
defendant nos. 1 to 6 and defendant no. 10. It is vehemently submitted
that by not issuing the directions as prayed in the notice of motion, both,
the learned Single Judge as well as the Division Bench have virtually
nullified the consent terms and the consent decree.
3.2 It is further submitted by the learned Senior Advocate appearing
on behalf of the appellants - original plaintiffs that the absurd consequence
of the impugned order is that though in terms of the consent terms/
decree flats were allotted to both, the appellants and respondent nos. 1
to 6, the appellants have got nothing under the consent decree till date.
It is submitted that on the other hand respondent nos. 1 to 6 have got not
only 7 flats of double the area of the PA Kash Foods Property, but also
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Rs. 45 crores and are enjoying the above since about 2015 by mortgaging
and dealing with their flats by raising large finances. It is submitted that
as held by this Court in the case of Manish Mohan Sharma and others
v. Ram Bahadur Thakur Ltd. and others (2006) 4 SCC 416
(paragraphs 31 & 32), the effort of the executing court must be to see
that the parties are given the fruits of the decree. It is submitted that it is
further observed in the said decision that the mandate is reinforced when
it is a consent decree and doubly reinforced when the consent decree is
a family settlement. It is submitted that it is further observed in the
aforesaid decision that family settlements are governed by a special
equity and are to be enforced if honestly made. Reliance is also placed
upon the decision of this Court in the case of Kale and others v. Deputy
Director of Consolidation and others (1976) 3 SCC 119.
3.3 It is further submitted by the learned Senior Advocate appearing
on behalf of the appellants - original plaintiffs that the net result as of
today is that both the consent terms and the consent decree in effect
result in a zero-sum game with no transaction accruing to the benefit of
the appellants. It is submitted that if that was so, there was no purpose
to enter into the consent terms at all.
3.4 It is further submitted by the learned Senior Advocate appearing
on behalf of the appellants - original plaintiffs that there is no basis, in
any event, for the Division Bench to ignore the clear recognition of the
appellants' entitlement under the consent terms/consent decree.
3.5 Now so far as the observations made by the learned Single
Judge on the necessity to have supplementary consent terms, before the
other terms of the consent decree are acted upon is concerned, it is
vehemently submitted that the same is erroneous. It is submitted that the
reliance placed upon clauses 13, 22, 23 and 27 of the consent terms by
the learned Single Judge is absolutely misplaced. It is submitted that
there is not a single clause in the entire consent terms and/or the consent
decree which either expressly or impliedly postpones or in any manner
makes the appellants' entitlement to get 'Annexure E' letter contingent
upon respondent nos. 1 to 6's specious plea of simultaneity with the
supplementary consent terms.
3.6 It is further submitted by the learned Senior Advocate appearing
on behalf of the appellants - original plaintiffs that the learned Single
Judge ought not to have read an implied term into the consent decree
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[M. R. SHAH, J.]
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and/or consent terms which was never intended by the parties and thereby
making the issuance of 'Annexure E' letter to the appellants conditional
and/or subject to the happening of an event, i.e., filing of the
supplementary consent terms, when no such clause finds place either in
the consent decree or consent terms. It is submitted that it is a settled
law that an implied term can be read into a contract only when it is so
obvious that the parties intended something but inadvertently the same
was left out. In support, reliance is placed upon the decision of this
Court in the case of Satya Jain and others v. Anis Ahmed Rushdie
and others (2013) 8 SCC 131 (paragraphs 32 to 35).
3.7 It is further submitted by the learned Senior Advocate appearing
on behalf of the appellants - original plaintiffs that as such there is no
such contingency supplied anywhere in the consent terms and/or consent
decree and in fact clause 28 of the consent terms read with paragraphs
2, 3 and 6 of the consent decree is an antithesis of the finding that
'Annexure E' is contingent upon the supplementary consent terms. It is
submitted that 'Annexure E' shall not depend upon the supplementary
consent terms to be executed/entered into as observed by the learned
Single Judge. It is submitted that clause 28 of the consent terms read
with paragraphs 2, 3 and 6 of the consent decree unambiguously and
unequivocally makes it clear that respondent no. 10 and respondent nos.
1 to 6 were to provide 'Annexure E' letter immediately and not at the
RA Group's convenience and/or at a later date, as per the whims and
fancies of respondent nos. 1 to 6 or contingent upon the supplementary
consent terms.
3.8 It is further submitted by the learned Senior Advocate appearing
on behalf of the appellants - original plaintiffs that none of the clauses in
the consent terms and/or the consent decree provides the supplementary
consent terms contingent upon 'Annexure E' letter and/or vice versa. It
is submitted that as held by this Court in the case of Saradamani
Kandappan v. S. Rajalakshmi and others (2011) 12 SCC 18, the
order of performance should be expressly stated or provided, i.e., the
agreement should say that only after performance of obligations of the
vendors, the purchaser will have to perform her obligations.
3.9 It is further submitted by the learned Senior Advocate appearing
on behalf of the appellants - original plaintiffs that even otherwise
because of the total non-cooperation on the part of respondent nos. 1 to
6 and with a malafide intention respondent nos. 1 to 6 are not co-operating
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in execution of supplementary consent terms. It is submitted that out of
the four items listed for valuation at clause D9(d) of the consent terms,
item no. (a) is a company in which both brothers hold 25.5% of the
shareholding each and the balance 49% is held by a third party; item no.
(b) and (c) is a company and a property respectively which are held
50:50 by both brothers; item no. (d) is the PA Kash Foods Property
which was to be valued for the purposes of adjustment. It is submitted
that the valuation was not done despite numerous reminders by the
appellants. It is submitted that several without prejudice emails were
addressed to respondent nos. 1 to 6 calling upon them to execute and
agree to the draft of the supplementary consent terms, which has not
been done till date.
3.10 It is further submitted by the learned Senior Advocate
appearing on behalf of the appellants - original plaintiffs that as such the
plaintiffs entered into the consent terms to buy peace and to resolve the
overall family dispute between the parties. It is submitted that as held by
this Court in the case of Hari Shankar Singhania and others v. Gaur
Hari Singhania and others (2006) 4 SCC 658 (para 42 and 43), a
family settlement is treated differently from any other formal commercial
settlement as such settlement in the eye of the law ensures peace and
goodwill among the family members. It is submitted that it is further
observed in the said decision that even technicalities of limitation, etc.
should not be put at risk of the implementation of a settlement drawn by
a family, which is essential for maintaining peace and harmony in a family.
3.11 Making the above submissions and relying upon the aforesaid
decisions of this Court, it is prayed to allow the present appeals.
4. Shri Shyam Divan, learned Senior Advocate appearing on behalf
of respondent nos. 1 to 6 and 8 & 9 has vehemently submitted that as
such the notice of motion/execution proceedings by the appellants herein
itself was premature and was for execution of only part of the consent
decree dated 14.08.2015 and therefore the same was not maintainable
at all being premature execution proceedings.
4.1 It is further submitted that the appellants are seeking to execute
a particular clause of consent terms dated 14.08.2015, which under the
said consent terms itself is required to be implemented after the parties
thereto arrived at a supplementary agreement which till date has not
been arrived at or entered into. It is submitted that therefore the learned
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Single Judge rightly dismissed the said execution petition. It is submitted
that by these proceedings the appellants are seeking to execute a part of
the consent decree without entering into the supplementary agreement.
4.2 It is further submitted that the orders interpreting the consent
decree are per se reasonable and based on sound reasoning taking into
account all relevant facts and material and submissions advanced by
both the sides and therefore does not warrant any interference by this
Court.
4.3 It is further submitted that as such the consent terms went
well beyond the dispute raised in Civil Suit No. 191/2015 and seeks to
comprehensively resolve all disputes such as those pertaining to the
factories owned by the parties, namely, AISCO, IMTC, Orbit Arya
Commercial Premises and overall family settlement.
4.4 It is further submitted that parties entered into the consent
terms and the consideration for the RAGroup agreeing to allot 8 flats
('Annexure A' properties) in favour of the PA Group was that the RA
Group would be rid of the minority status of AISCO - one of the group
companies of both the groups wherein RA Group was in a minority and
whose rights were being oppressed in the said company and the disputes
qua all the other group companies would also achieve quietus. It is
submitted that in fact the 8 flats ('Annexure A' properties) were as such
belonged to RA Group. It is submitted that by the present execution
proceedings the appellants want to execute that part of the consent
decree which favours them - allotment of 8 flats ('Annexure A'
properties), but without in any manner complying with their obligations
under the consent terms/consent decree, i.e., the execution of
supplementary consent terms, as defined in clause 13. It is submitted
that the appellants cannot be permitted to get the consent decree executed
in part and which is in their favour and without in any way complying
with their obligations under the consent decree.
4.5 It is further submitted that neither under the consent terms
nor under the consent decree, there is an obligation on the part of the
RA Group to issue 'Annexure E' forthwith upon signing of the consent
terms. It is submitted that if the submission on behalf of the appellants
that 'Annexure E' is to be executed forthwith and that vesting/allotment
of PA Kash Foods Property immediately upon signing of the consent
terms is accepted, in that case, it would defeat the plain language of
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clauses 9, 13, 14, 17 and 18, all of which mandate that matters relating to
PA Kash Foods Property are to be contained in the supplemental consent
terms. It is submitted that the settlement between the parties in all
respects was to be crystallized in the supplemental consent terms. It is
submitted that therefore the present consent terms/consent decree can
be described only as a "framework" in clauses 2, 3 and 30.
4.6 Now so far as reliance placed upon clause 28 of the consent
terms by the appellants is concerned, it is vehemently submitted that
clause 28 provides for no direction to RA Group to sign 'Annexure E' on
execution of the consent terms. It is submitted that in the absence of a
direction in a clause dealing with a "direction/request" to Omkar Builders
regarding 'Annexure E' completely militates against PA Group's
submission and their interpretation. It is submitted that if the intention
was for 'Annexure E' to be issued by the RA Group "forthwith", clause
28 would have been the obvious and natural pace to provide for it. It is
submitted that even the Omkar Builders was not a party to the consent
terms/decree and therefore the contents of clause 28 would not bind it.
It is submitted that it is only with a view for securing compliance of
Omkar Builders that the High Court passed an order on the same day
enabling Omkar Builders to issue 'Annexure E'.
4.7 Now so far as the reliance placed upon clause 22 of the
consent terms by the appellants, it is vehemently submitted that as per
clause 22 RA Group will be free to deal with PA Kash Foods Property
as their exclusive and absolute owners thereof with effect from the
filing of the consent terms and the PA Group does not have any claim
direct, derivative or otherwise of whatsoever nature upon the same. It is
submitted that therefore there may not be any restrain against RA Group
from dealing with the properties that form the subject matter of Kash
Foods Property.
4.8 It is further submitted that as both the learned Single Judge as
well as the Division Bench have succinctly interpreted the consent terms/
consent decree and upon understanding and comprehending the intention
of the parties have held that RA Group was not obligated to execute
'Annexure E' at this stage and that independently there was no fetter on
the RA Group from dealing with its properties.
4.9 Making the above submissions, it is prayed to dismiss the
present appeals.
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5. We have heard the learned Senior Advocates for the respective
parties at length.
5.1 At the outset, it is required to be noted that as such the present
proceedings arise out of the execution proceedings initiated by the
appellants herein, who were also parties to the consent terms/consent
decree. The consent decree came to be passed in Suit No. 194/2015
filed by the PA Group. It is also required to be noted that the dispute in
Civil Suit No. 194/2015 filed by the appellants/PAGroup was for seeking
50:50 division of the benefits received by Kash Foods under the
development agreement with Omkar Builders. However, from the
consent terms dated 14.08.2015, it appears that both the parties - PA
Group and RA Group decided to resolve and settle the other disputes
also, i.e., over and above the dispute in the suit. From the consent terms,
it appears that both the parties unconditionally and unequivocally
amicably resolved and settled the disputes in relation to the subject matter
of Arya Iron and Steel Company Private Limited ("AISCO");
International Minerals Trading Company Private Limited ("IMTC"); Kash
Foods Private Limited's premises in the Omkar 1973 Project at Worli
("Kash Foods"), which forms the subject matter of the present Suit;
Orbit Arya Commercial Premises ("Orbit Arya Commercial Premises");
and Disputes in relation to the larger Arya Group of Companies and its
constituents (collectively "the Dispute"). Further, in the consent terms in
para 2, it has been specifically mentioned that the said consent terms are
an identified and mutually agreed framework for a complete parting of
ways between the parties and is aimed at bringing about an eventual
complete quietus to the disputes. Clause 3 of the consent terms further
provides that the parties shall execute a definitive "Family Arrangement
and Settlement" and/or writings as may be required and/or as may be
advised for a complete parting of ways, which shall work on the basis of
the said mutually agreed framework ("Family Arrangement and
Settlement"). Other terms and conditions provide for modalities to be
worked out to enter into a further "Family Arrangement and Settlement".
Clause 13 also provides for execution of supplemental consent terms.
Clause 21 also further provides that until conclusion of the transfer, the
parties shall not affect each other's rights, in any way in AISCO and/or
IMTC. As per clause 22 of the consent terms, RA Group and/or Kash
Foods shall not in any manner directly and/or indirectly or derivatively
be entitled to sell and/or transfer, and/or dispose of and/or encumber
and/or otherwise deal with the PA Kash Foods Property. It further
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provides that the modification, if any, of the Restraint, shall be identified
in the supplementary consent terms. Clause 23 of the consent terms
further provides that the RA Group and/or Kash Foods shall publish a
Public Notice within 3 days of filing of the supplemental consent terms,
withdrawing their claims in relation to PA Kash Foods Property (more
particularly described at 'Annexure C'). Clause 25 also further provides
that similarly the PA Group shall publish a Public Notice within 3 days of
filing of the supplemental consent terms, as more particularly described
at 'Annexure D'. Clause 28 of the consent terms further provides that
Omkar Builders be directed/requested to issue a separate letter in relation
to the PA Group's entitlement to the PA Kash Foods Property in Omkar
1973 Project (more particularly 'Annexure A') as per draft at 'Annexure
E'. Under the said clause, Omkar Builders was also further directed to
strictly abide by the Restraint in relation to the PA Kash Foods property.
The relevant terms of the settlement are as under:
"The parties have unconditionally and unequivocally amicably
resolved and settled the disputes in relation to the subject matter
of:
a. Arya Iron and Steel Company Private Limited ("AISCO");
b. International Minerals Trading Company Private Limited
("IMTC")
c. Kash Foods Private Limited's premises in the Omkar 1973
Project at Worli ("Kash Foods"), which forms the subject matter
of the present Suit;
d. Orbit Arya Commercial Premises ("Orbit Arya Commercial
Premises"); and
e. Disputes in relation to the larger Arya Group of Companies and
its constituents (collectively "the Dispute")
2. The present Consent Terms is an identified and mutually agreed
framework for a complete parting of ways between the Parties
and is aimed at bringing about an eventual complete quietus to the
Disputes.
3. The Parties shall on or before November 1, 2015 (or such date
as may be mutually extended in writing by the Parties) execute a
definitive Family Arrangement and Settlement and/or writings
(including such documents, writings, undertakings and agreements)
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as may be required and/or as may be advised for a complete
parting of ways, which shall work on the basis of the said mutually
agreed framework ("Family Arrangement and Settlement").
13. As to the (i) PA Kash Foods Property and (ii) Orbit Arya
Commercial Premises the Parties have agreed that they would
mutually decide the modalities of brief to the Valuers and the Third
Valuer and mode of adjustment/payment on or before August 29,
2015; and Supplemental Consent Terms recording the same
("Supplemental Consent Terms") shall be filed in this Court on
August 30, 2015.
14.