K.R. NARAYANAN Vs. M. SIVA PRAKASAM

JUDGEMENT

(1.) THESE appeals are preferred against the order in (i) O.A. No. 1028 of 2010 granting temporary injunction restraining the Appellant -Landlord from alienating the suit property and (ii) O.A. No. 1031 of 2010 restraining the Appellant -Landlord from interfering with the possession of the Respondent -Builder in respect of the suit property. Appellant is the owner of Door No. 1, New Door No. 49, First Main Road, Siringeri Mutt Road, Ramakrishna Nagar, Chennai -28. Appellant -Landlord and Respondent -Builder have entered into Memorandum of Understanding (MOU) on 23.12.2003 for joint development of the said house property bearing Door No. 41, New Door No. 49. As per the Memorandum of Understanding, Respondent -Builder has to put up twelve flats consisting of three flats in each floor i.e. 1 to 4 floors. Out of the constructed flats, fifty percent of the flats i.e. six flats in 3rd and 4th floor to be allotted to the Appellant -Landlord and six flats in the 1st and 2nd floor to be allotted to the Respondent -Builder. The entire cost of construction of twelve flats shall be borne by the Respondent -Builder. A sum of Rs. 25,00,000/ - was paid by the Respondent -Builder to the Appellant -Landlord as security deposit, refundable without interest. In addition, a sum of Rs. 10,000/ - shall be paid by the Respondent -Builder every month to the Appellant -Landlord towards monthly rent for the accommodation of the Appellant -Landlord, since he has to shift his residence to some other building till the construction of the building is over. In terms of Clause 7 of the Memorandum of Understanding, Appellant -Landlord executed a power of attorney in favour of Respondent -Builder on 23.12.2003. Besides the agreed amount of Rs. 25,00,000/ -, another sum of Rs. 1,00,000/ - was paid by the Respondent -Builder to the Appellant -Landlord for his urgent needs by treating the same to be the additional security. Thus total sum of Rs. 26,00,000/ - was paid as security by the Respondent -Builder. Appellant -Landlord appointed the Respondent -Builder as power of attorney to develop and sell the property. On 17.6.2004 the building was handed over by the Appellant -Landlord to the Respondent -Builder for demolition. Original title deeds were also handed over to the Respondent -Builder for applying planning permit.

(2.) CASE of Respondent -Builder is that after completion of construction of flats, Appellant -Landlord requested the Respondent -Builder to hand over the keys of three flats allotted to him to conduct house warming ceremony i.e. Grahapravesam and agreed to return the keys next day itself and believing his words, the keys of three flats in the top floor given to the Appellant -Landlord. But the Appellant -Landlord did not return the keys and occupied all the three flats. Without returning the keys, on 10.05.2010, Appellant -Landlord issued a lawyer's notice stating that the power of attorney dated 23.12.2003 executed by him appointing the Respondent -Builder as power of attorney stands cancelled. According to Respondent -Builder, the cancellation of power of attorney is unilateral and illegal and in violation of Memorandum of Understanding.

(3.) IN these circumstances, Respondent -Builder filed two applications under Section 9 of Arbitration and Conciliation Act in O.A. No. 1028 and 1031 of 2010 restraining the Appellant -Landlord from alienating the property and also from interfering with the possession of the Respondent -Builder respectively.