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Gaurav Rajeshbhai Desai & Ors vs Yagyanarayan Prabhunath Mishra & Ors 2026 BHC-AS 8190

Synopsis

This Bombay High Court judgment arises from an Appeal from Order challenging the rejection of a temporary injunction application by the Trial Court. The appellants, who purchased property through a registered conveyance deed, sought to restrain the respondents (lessees in possession) from creating third-party rights in the suit property pending disposal of the suit for recovery of possession. The Trial Court had restrained the appellants from creating third-party rights but declined to grant similar relief against the respondents. The High Court set aside the impugned order, holding that when both parties assert competing rights over the same property and their respective suits are pending, equity demands that neither side be permitted to alter the status quo by creating third-party interests pending trial.

1. Case Identification & Coram

Court: High Court of Judicature at Bombay

Jurisdiction: Appellate Jurisdiction

Appeal from Order No.: (Not specified in provided text, but arises from impugned order dated 3rd May 2023)

Coram: Hon'ble Justice Kamal Khata

Nature of Bench: Single Judge

Date of Pronouncement: 17th February 2026

Date of Reservation: 10th February 2026

2. Legal Framework & Relevant Provisions
The judgment engages with civil procedure and property law:

Procedural Law:
Section 104 of the Code of Civil Procedure, 1908: Appeals from orders.
Order 43 Rule 1(r) of the Code of Civil Procedure, 1908: Appeals from orders under Order 39 Rules 1 and 2 (temporary injunctions).
Order 39 Rules 1 and 2 CPC: Grant of temporary injunctions.
Substantive Law:
Transfer of Property Act, 1882: Principles governing lease, tenancy holding over, and registration requirements for immovable property transfers.
Registration Act, 1908: Requirement of registration for documents creating rights in immovable property.
Key Precedents Relied Upon:
Dalpat Kumar v. Prahlad Singh (1992) 1 SCC 719: Three cardinal principles for grant of temporary injunction: prima facie case, balance of convenience, irreparable injury.
Maharwal Khewaji Trust (Regd.) v. Baldev Dass (2004) 8 SCC 488: Courts should ordinarily maintain status quo in disputes relating to immovable property to preserve subject matter of litigation.
Wander Ltd. v. Antox India (P) Ltd. 1990 Supp SCC 727: Appellate court's interference with discretionary orders is justified where discretion exercised on erroneous principles or relevant considerations ignored.
Suraj Lamp & Industries Pvt. Ltd. v. State of Haryana (2012) 1 SCC 656: Rights in immovable property can be transferred only by registered instrument; unregistered document cannot confer proprietary rights.
K.B. Saha & Sons Pvt. Ltd. v. Development Consultant Ltd. (2008) 8 SCC 564: Unregistered document cannot confer proprietary rights capable of enforcement in law.
S.P. Chengalvaraya Naidu v. Jagannath (AIR 1994 SC 853): Principles regarding suppression of facts.
Ramjas Foundation v. Union of India (2010) 14 SCC 38: Suppression of material facts disentitles party to discretionary relief.

3. Relevant Facts of the Case

The appellants claim to be joint owners of agricultural land bearing Survey No. 89, Hissa No. 01A + 1 B/2A admeasuring 5060 sq.mtrs. at Village Chikanghar, Taluka Kalyan, acquired through a registered Deed of Conveyance dated 28th August 2014 from the original owners.
Two lease deeds existed prior to the appellants' purchase:
First registered Lease Deed dated 24th April 1968: Mr. Madharao Narayan Mahesh (original owner) leased land admeasuring 4060 sq.yds (suit property) to respondent No.1 for 50 years on monthly rent of ₹200/-.
Second registered Lease Deed dated 16th July 1971: Same lessor leased another area admeasuring 2115.5 sq.yds (Survey No. 88 Hissa No.1) to respondent No.1 for 75 years.
The 50-year lease expired on 23rd April 2018. The second lease was terminated by notice.
Respondent No.1 earlier instituted Special Civil Suit No. 194 of 2017 seeking specific performance of an alleged unregistered Agreement dated 7th March 1994 and declaration that the appellants' sale deed is null and void. In that suit, the Trial Court restrained the appellants from creating third-party rights.
The appellants thereafter instituted Special Civil Suit No. 18 of 2023 seeking recovery of possession of the suit property and permanent injunction restraining respondents from creating third-party interests.
The Trial Court, by impugned order dated 3rd May 2023, rejected the appellants' temporary injunction application (Exhibit-5), effectively permitting respondents to create third-party rights while maintaining restraint against appellants.
The respondents relied on the unregistered Agreement dated 7th March 1994, alleged to have been executed by Smt. Vatsalabai Saraf (predecessor) in their favour.
The appellants filed the present Appeal from Order challenging the rejection of injunction.

4. Issues Before the High Court
The primary issues for determination were:

Whether the Trial Court erred in declining to grant temporary injunction restraining the respondents from creating third-party rights in the suit property pending disposal of the suit?
Whether the principle of parity required that both parties be restrained from creating third-party interests when competing claims over the same property are pending adjudication?
Whether the appellants' alleged suppression of the 1994 Agreement disentitled them to discretionary relief?
Whether the unregistered Agreement dated 7th March 1994 could confer any enforceable rights so as to justify permitting the respondents to deal with the property pending trial?

5. Ratio Decidendi & Court's Reasoning

The Court allowed the appeal and set aside the impugned order. The ratio decidendi can be summarized as:

Principle of Parity: When both parties assert competing rights over the same property and their respective suits are pending adjudication, equity demands that neither side be permitted to alter the status quo by creating third-party interests pending trial. Restraining one party while permitting the other creates an imbalance and confers an unwarranted advantage that may render final adjudication infructuous.
Preservation of Subject Matter: Following Maharwal Khewaji Trust, courts should ordinarily maintain status quo in disputes relating to immovable property to safeguard the property in dispute so that rights of parties are not irreversibly prejudiced before final adjudication. Permitting alienation at interim stage would virtually result in grant of final relief to one side.
Prima Facie Case and Irreparable Injury: The competing claims of title are yet to be adjudicated. If, pending such adjudication, either party is permitted to create third-party interests, it would not only alter status quo but would also give rise to multiplicity of proceedings and complications that may render the final decree infructuous. This constitutes irreparable injury.
Suppression of Facts – Not Made Out: The contention of suppression based on non-reference to the 1994 Agreement did not merit acceptance. The plaint referred to Special Civil Suit No.194 of 2017. Mere failure to specifically mention or reproduce the 1994 Agreement in detail cannot, in the facts of this case, be construed as deliberate suppression so as to disentitle the appellants from interim relief.
Unregistered Agreement – No Proprietary Rights: The Agreement dated 7th March 1994 is admittedly unregistered. Following Suraj Lamp and K.B. Saha & Sons, rights in immovable property can be transferred only by registered instrument, and an unregistered document cannot confer proprietary rights capable of enforcement in law. Knowledge of an unregistered agreement cannot automatically be imputed to a subsequent purchaser. Awareness of respondents' possession as lessees cannot be equated with notice of a superior or independent contractual right.
Erroneous Exercise of Discretion: Following Wander Ltd., appellate interference is justified where discretion has been exercised on erroneous principles or relevant considerations ignored. The Trial Court failed to consider the consequences of denying parity of interim protection.
Matters to be Adjudicated at Trial: The enforceability and effect of the 1994 Agreement are matters to be adjudicated in the pending suit. Pending such adjudication, respondents cannot claim an unrestricted right to deal with the property in a manner that may prejudice the appellants' claimed title.

6. Legal Principles Established/Reinforced

While the judgment does not establish entirely new law, it clarifies and reinforces several principles:

Parity in Interim Relief: In property disputes where both parties have filed cross-suits or assert competing claims, courts should ordinarily maintain parity in granting interim relief. Restraining one party while permitting the other to deal with the property creates an unwarranted imbalance.
Status Quo in Property Disputes: The default position in disputes involving immovable property should be maintenance of status quo to preserve the subject matter of litigation. This prevents final relief being granted at an interim stage and avoids multiplicity of proceedings.
Unregistered Document – Limited Evidentiary Value: An unregistered agreement cannot confer proprietary rights capable of enforcement in law. Mere knowledge of such an unregistered document by a subsequent purchaser does not constitute notice of superior rights.
Suppression – Need for Specificity: For the doctrine of suppression to disentitle a party to discretionary relief, the suppression must be deliberate and material. Mere failure to mention a document in detail, especially when related proceedings are referred to, does not automatically constitute suppression warranting denial of relief.
Appellate Interference in Discretionary Orders: Appellate courts will interfere with discretionary orders where the discretion has been exercised on erroneous principles, relevant considerations have been ignored, or the order results in manifest injustice.

7. Judicial Analysis & Examination

The Court's analytical approach was structured:

Examination of Trial Court's Reasoning: The Court noted the anomaly in the Trial Court's approach – restraining appellants from creating third-party rights while declining similar relief against respondents, effectively permitting respondents to alienate the property.
Application of Injunction Principles: The Court applied the three-fold test from Dalpat Kumar:
Prima facie case: Competing claims exist and are yet to be adjudicated.
Balance of convenience: Lies in maintaining status quo and preventing alienation by either party.
Irreparable injury: Permitting alienation would render final decree infructuous and cause multiplicity of proceedings.
Consideration of Suppression Allegation: The Court examined the respondents' claim of suppression and found it insufficient to deny relief, noting that the plaint referred to the related suit and mere non-mention of the unregistered agreement in detail did not constitute deliberate suppression.
Legal Effect of Unregistered Document: The Court applied Suraj Lamp and K.B. Saha & Sons to hold that the unregistered 1994 Agreement could not confer proprietary rights, and its enforceability was a matter for trial.
Equitable Considerations: The Court emphasized equity and good conscience, noting that permitting alienation at this stage would be inequitable and prejudicial to the appellants who hold a registered conveyance.

8. Critical Analysis & Final Outcome

Critical Analysis: The judgment is a sound application of established principles of temporary injunctions to a fact situation involving competing claims and cross-suits. The Court correctly identified the fundamental flaw in the Trial Court's order: creating an asymmetrical interim regime where one party is restrained while the other is not, despite both asserting rights over the same property. The principle of parity is not merely a matter of fairness but a practical necessity to preserve the subject matter of litigation and prevent multiplicity of proceedings. The Court's treatment of the suppression issue is also balanced – mere knowledge of an unregistered document cannot be equated with notice of rights, and the appellants' reference to the related suit in the plaint negates any inference of deliberate concealment. The reliance on Suraj Lamp reinforces the importance of registration in creating proprietary rights, a fundamental principle of property law. However, one might note that the Court did not finally adjudicate the validity of the 1994 Agreement – that remains for trial. The interim order merely preserves the property pending such adjudication. The judgment also implicitly recognizes the societal interest in protecting educational institutions (the respondents claimed to run schools with 1200 students) but correctly holds that such considerations cannot override the need to maintain status quo pending determination of legal rights.

Final Outcome:
The impugned order dated 3rd May 2023 passed by the learned Civil Judge (Senior Division), Kalyan, was set aside.
The respondents were restrained from creating any third-party rights, title or interest in the suit property pending the final disposal of the suit.
All other issues were left open for determination at the stage of final hearing.
The Trial Court was directed to dispose of the suit expeditiously.
Interim Application also stood disposed of.