Kolkata: The Calcutta High Court has set aside an ex-parte ad-interim injunction that had restrained developer Merlin Projects Ltd. and Hatisala Developers Pvt. Ltd. from dealing with Statesman House, the redeveloped heritage property of The Statesman Limited at Chowringhee, which was sold for Rs 235 crore under a 2025 deed of conveyance.
The Statesman alleged that Merlin exceeded its authority under the Power of Attorney and, without consent, sold the redeveloped property to Hatisala Developers Pvt. Ltd. on June 27, 2025, for Rs 235 crore. It had sought a declaration that the sale was void and an injunction against further dealings.
Merlin maintained that the sale was executed in The Statesman’s name through its constituted attorney and within its contractual powers. A Division Bench of Justice Arijit Banerjee and Justice Om Narayan Rai held that documents executed between The Statesman and the developer in March 2019 prima facie conferred authority on Merlin to market and dispose of the saleable portion of the project, and that the company’s remedy, if any, lay in damages rather than an injunction. The Bench vacated a Single Judge’s order that had restrained the appellants from altering the property or creating third-party rights.
Merlin submitted that six instruments executed on March 26, 2019 — a Joint Development Agreement, Power of Attorney, Deed of Mortgage, Deed of Guarantee, Deed of Declaration and a letter of the same date — formed a composite arrangement making it both developer and constituted attorney of The Statesman.
It said it had advanced funds to repay dues to the State Bank of India, the property was mortgaged in its favour, and that minutes of a meeting dated May 10, 2024 entitled it to dispose of the property if repayment was not made.
The Bench held the May 2024 minutes were in furtherance of the JDA. Clarifying the scope of the contract, it said the terms “Project” and “Said Premises” referred to the same property—before and after development—and that the developer’s authority extended to the entire premises. The court noted the project was complete and a completion certificate issued, observing that the conveyance to Hatisala, executed in The Statesman’s name through its attorney, could prima facie indicate extinction of the right of redemption under Section 60 of the Transfer of Property Act.Finding that The Statesman Ltd failed to establish a prima facie case or irreparable injury, and that the balance of convenience lay with the developer and purchaser, the Bench vacated the injunction. It clarified that its observations were prima facie and would not affect the pending trial before the court.
Case history
According to Merlin Projects Ltd, The Statesman Ltd had obtained a Rs 47-lakh loan from the State Bank of India in 2007 but defaulted, leading to proceedings under the SARFAESI Act, 2002, and before the Debt Recovery Tribunal. It later approached Merlin for redevelopment of Statesman House on a joint venture basis to clear its dues.
Merlin said it advanced Rs 29 crore under a registered mortgage deed and Joint Development Agreement (JDA) executed on March 26, 2019, to help repay the bank, and that SBI approved a settlement of Rs 33.70 crore. It also paid Rs 1 crore as an interest-free refundable deposit ordered by the tribunal.
When funds proved insufficient, it arranged another Rs 1.75 crore through its NBFC Innocent Merchandise Pvt. Ltd., and later Rs 27.77 crore through sister concerns.
Merlin said it also paid municipal taxes, CESC dues, vendor charges and employee liabilities including salary, gratuity and provident fund. The developer alleged that funds advanced to settle these dues were siphoned off by The Statesman.
Following a May 10, 2024 arrangement where The Statesman agreed to buy Merlin’s share and repay all loans by July 15, 2024, no payment was made. Merlin said it then exercised its right and sold the property to Hatisala Developers Pvt. Ltd. on June 27, 2025, for Rs 235 crore. After preparing project accounts and seeking The Statesman’s bank details to remit its balance share, Merlin said the company objected and filed a commercial suit before the High Court.