Delhi District Court
Housing Development Finance ... vs Mr. Sachal Kumar Srivastava on 10 January, 2019
IN THE COURT OF GAURAV RAO, ADJ02 & Waqf Tribunal /
NEW DELHI DISTRICT, PATIALA HOUSE COURTS, NEW DELHI.
CS No. 59357/16 (Old no. 14/2013)
CNR No. DLND010151182016
Housing Development Finance Corporation Limited
Registered office at:
Ramon House HT Parekh Marg
169, Backbay Reclamation
Churchgate, Mumbai 400020
Having its Northern Regional Office at:
The Capital Court
Munirka, Olof Palme Marg,
New Delhi110067. ........Plaintiff
Vs.
1. Mr. Sachal Kumar Srivastava
Flat no. 510, Bhagirathi Apartments,
B9/14, Sector62,
Noida 201301
Also at
Tata Consultancy Service
Plot No. 263363, Udyog Vihar,
Phase - IV, Gurgaon, Haryana
2. Mr. Indra Pal Singh
Village Sorkha Sector 115,
Noida, Uttar Pradesh - 201301.
3. M/s Golf Course Sahkari Awas
Samiti Limited
CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 1/ 28
A Society incorporated under Section 6 of
UP Cooperative Societies Act 1965
Through its Secretary
Having its registered office at:
C217, Sector Beta 1, Greater Noida,
Uttar Pradesh
Also at:
D162, Ist Floor, Sector 10,
Noida, Gautam Budh Nagar,
UP.
..........Defendants
Date of institution : 04.01.2013
Date on which reserved for judgment : 08.01.2019
Date of decision : 10.01.2019
Decision : Decreed
JUDGMENT
1. Vide this order/judgment I shall dispose of the application, moved by defendant no. 2, seeking leave to defend the present suit filed under Order XXXVII CPC by the plaintiff.
Plaint
2. It is the case of the plaintiff that it is a company incorporated under the provisions of Indian Companies Act, 1956 and Mr. D.K Gupta, its CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 2/ 28 Assistant General Manager, Credit Risk Management has been authorized to institute the present suit vide authority letter dated 03.02.2012.
2.1 It is further its case that it is engaged in the business of granting loans, especially home loans and is one of the biggest, most respected institution in the business of financing.
2.2 It is further its case that defendant no. 1 and 3 jointly approached it, in their capacity as borrower and builder respectively, for availing housing loan by defendant no. 1 for purchase of flat no. 4052, 5th Floor, Tower T4, Shivkala Charms, Plot no. 7, Sector PIII, Greater Noida, Uttar Pradesh 201308 (hereinafter referred to as the suit property) which was being constructed by defendant no. 3.
2.3 It is further its case that it was represented by defendant no. 1 that he has satisfied himself about the integrity and capability of defendant no. 3 to complete the project on time.
2.4 It is further its case that on 26.04.2011 defendant no. 1 & 3 entered into a tripartite agreement with it and on 02.05.2011 it & defendant no. 2, being the power of attorney holder of defendant no. 1, also executed a loan agreement whereby defendant no. 1 was allotted loan Account bearing no. 601705083.
CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 3/ 28 2.5 It is further its case that defendant no. 3 vide letter dated 25.04.2011 also marked lien of the plaintiff on the the suit property.
2.6 It is further its case that based on several representations of defendant no. 1 and 2 and being consented & acknowledged by defendant no 3, it sanctioned a loan of sum of Rs. 36,80,000/ to defendant no. 1, for the purpose of purchase of the suit property, for a period of 240 months with variable rate of interest.
2.7 It is further its case that on request of defendant no. 1, it disbursed the total amount of Rs. 34,80,000/ to defendant no. 3 and cheque bearing no. 83526 dated 30.04.2011 drawn on HDFC bank was also issued in favour of defendant no. 3. It is further its case that defendant no. 2, on behalf of defendant no.1, executed promissory note dated 02.05.2011 for the sanctioned loan amount in favour of the plaintiff.
2.8 It is further its case that defendant no. 1 executed indemnity bond dated 29.04.2011 in favour of the plaintiff thereby agreeing to disburse the loan amount in the account of defendant no. 3.
2.9 It is further its case that as per clause 2.6 of the loan agreement defendant no. 1 had agreed to pay equated monthly installments/Pre equated CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 4/ 28 monthly installments (EMI/PEMI) every month. It is further its case that defendant no. 1 agreed, as per clause 2.7 (b) of the loan agreement, to pay additional interest as per the rules of the plaintiff as in force and all other charges as applicable from time to time, as per the policy of the plaintiff, in case of delay/default in making the repayment of the loan. It is further its case that it was also agreed by defendant no. 1, in the loan agreement, that under unforeseen or exceptional or extraordinary changes in the money market conditions, the plaintiff shall have the discretion of increasing/decreasing the rate of interest.
2.10 It is further its case that as per the tripartite agreement the loan was repayable by defendant no.1 by way of EMI/PEMI and it was also agreed between the parties that irrespective of the stage of the construction of the project and irrespective of the date of handing over the possession of the suit property, defendant no. 1 shall be liable to pay the plaintiff regularly each month EMI/PEMI as laid down in the loan agreement. It is further its case that under the tripartite agreement, defendant no. 1 had also agreed to secure with the plaintiff the suit property by way of mortgage and defendant no. 3 also agreed and confirmed the mortgage to be created by defendant no.
1. It is further its case that defendant no. 3 undertook not to create any third party rights or security interest of any sort whatsoever in the suit property without the prior written consent of the plaintiff.
CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 5/ 28 2.11 It is further its case that in terms of tripartite agreement it was agreed that in case of default in the repayment of the loan, any amount payable by defendant no. 3 to defendant no. 1 on account of cancellation of allotment of the suit property, shall be paid directly to the plaintiff by defendant no. 3. It is further its case that it was further agreed that such payment made by defendant no. 3 directly to plaintiff shall not absolve defendant no.1 from his liability to pay the residual amount outstanding under the loan agreement and therefore defendant no. 3 is under an obligation in terms of the tripartite agreement to return the money, on account of default committed by defendant no. 1 in repayment of the loan amount, directly to the plaintiff, for appropriation and adjustment by the plaintiff against all monies due from defendant no. 1. It is further its case that defendant no. 1 also unconditionally and irrevocably subrogated its right to receive any amount payable by defendant no. 3 to defendant no. 1 in the event of cancellation, in favour of the plaintiff and therefore as per the agreement the defendant no. 3 is under obligation to refund the disbursed amount to the plaintiff.
2.12 It is further its case that last payment was made by defendant no. 1 towards the repayment of loan & accounted for by the plaintiff on 15.12.2011 and thereafter no amount has been paid towards the repayment of the loan by defendant no. 1. It is further its case that in terms of agreement/arrangement between the defendants to which the plaintiff was CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 6/ 28 not privy, defendant no. 3 on behalf of defendant no. 1 and 2 made payment of Rs. 67,166/ towards the outstanding loan amount. It is further its case that defendant no. 1 still has not made any efforts to clear the outstanding amount and same show his malafide intentions to usurp the loan amount advanced by the plaintiff.
2.13 It is further its case that plaintiff sent loan recall notice dated 31.08.2012 to defendant no. 1 and 2 demanding the outstanding amount, however defendant no. 1 and 2 did not reply to the same nor paid the outstanding amount.
2.14 It is further its case that it also sent a demand notice dated 10.09.2012 to defendant no. 3 for the refund of the amount however defendant no. 3 failed to refund the same.
2.15 Hence the present suit.
3. Summons under Order XXXVII CPC in the prescribed format were issued against the defendants however leave to defend application was filed on behalf of defendant no. 1 only. Defendant no. 2 did not file any appearance despite service of summons as is evident from proceedings dated 27.09.2016. As far as defendant no. 3 is concerned no leave to defend application was filed despite service of summons for judgment as is evident CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 7/ 28 from proceedings dated 21.11.2013.
Leave to Defend application of defendant no. 1.
4. In the application seeking leave to defend it is pleaded that he has substantial defence to demolish the entire case of the plaintiff as he is a victim at the hands of plaintiff & defendant no. 3 who connived with each other and trapped the innocent customers like him in their trap.
4.1 It is pleaded that plaintiff had deputed one of its officials in the office of defendant no. 3 to whom defendant no. 3 used to take the customer for their satisfaction. It is his case that when he approached defendant no. 3 for booking the suit property, he was introduced to the said bank officer and on his query, as to the ownership of defendant no. 3 qua the under construction project and other rules & regulations like sanction plan, NOC by the concerned authority, the said bank officer told him that the bank does not give any penny as a loan to any customer unless and until the bank is satisfied qua the ownership of the property, rules & regulations essential to be followed by builder/developer. It is further pleaded that bank official told him that bank has gone through all the relevant documents and decided to give loan to the customers after getting the property mortgaged in the name of the bank and after entering into tripartite agreement between the bank, the borrower and the builder.
CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 8/ 28 4.2 It is further pleaded that the he found substance in the statements of the bank official, agreed to purchase the suit property from defendant no. 3 and requested plaintiff bank to grant loan to him for the same, only after having been persuaded by defendant no. 3 and assurance of the bank official that plaintiff would recover the amount from defendant no. 3 in case of any defect in the title of documents of the builder and also in case of any illegality in the dealings including the violation of any rules & regulations of the building bylaws by defendant no. 3.
4.3 It is further pleaded that plaintiff sanctioned a sum of Rs. 36,80,000/ as a loan to him to purchase the suit property and made total disbursement of Rs. 34,80,000/ to defendant no. 3 by way of cheque no. 83526 dated 30.04.2011.
4.4 It is further pleaded that he started repaying the loan amount as per terms and conditions of the tripartite agreement and loan agreement but later on came to know that he was cheated by the plaintiff and defendant in connivance with each other.
4.5 It is further pleaded that he wrote a letter to defendant no. 3, surrendered the suit property and requested it to pay the balance EMI/loan outstanding amount from January 2012 onwards on his behalf directly to the CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 9/ 28 plaintiff bank. It is further pleaded that he had paid seven installments of Rs. 33,583/ to the plaintiff for the month of June 2011 to December 2011 totaling to Rs. 2,35,081/.
4.6 It is further pleaded that he sent an email to the plaintiff on 12.03.2012 and informed it that he had a discussion with defendant no. 3 regarding surrender of the suit property and assurance was given by defendant no. 3 that it would be paying pending EMIs of January 2012 and February 2012 by end of March 2012 directly to the bank and shall also be paying EMI for March 2012 by the end of March 2012 to the bank. It is further pleaded that he also informed the plaintiff that defendant no. 3 shall foreclose the loan by July 2012 and any EMI due till that time shall be paid by defendant no. 3 to the bank.
4.7 It is further pleaded that plaintiff acknowledged the receipt of above email but gave no response thereto and he sent another email to the plaintiff on 14.03.2012 informing it that the payment of the cheques given to it shall be stopped due to the reasons mentioned in the email dated 12.03.2012.
4.8 It is further pleaded that he sent another email dated 19.03.2012 to the plaintiff informing it that he had spoken to defendant no. 3 again and defendant no. 3 had confirmed making payment of all the outstanding to the CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 10/ 28 bank by 25.03.2012. It is further pleaded that he sent an email to the plaintiff on 09.04.2012 to confirm whether defendant no. 3 had made payments of dues to the bank or not as he was told by defendant no. 3 that payment of Rs. 67,166/ was paid to the plaintiff by defendant no. 3 but plaintiff did not bother to give response to his email.
4.9 It is further pleaded that plaintiff issued a statement of account for the period 01.04.2012 to 18.04.2012 to him on 18.04.2012 and he came to know only on 18.04.2012 that defendant no. 3 started making payment of EMI on his behalf had made payment of Rs. 67,166/ to the plaintiff and this fact has also been admitted by the plaintiff in its plaint.
4.10 It is further pleaded that he requested the plaintiff to issue NOC/closure letter in respect of the loan account bearing no. 601705083 as he had surrendered the suit property in the month of March 2012 and as per his knowledge defendant no. 3 and bank were working together for settlement however the plaintiff did not give any response to his request for issuance of NOC.
4.11 It is further pleaded that in November 2013 he came to know through news appearing on the website of Hindustan times i.e. www.hindustantimes.com that more than 400 people were cheated of amounts ranging from 25 lacs to Rs. 35 lacs after they fell prey to the CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 11/ 28 promise of Shivkala Charma and it was also mentioned that plaintiff had come out with a list of 78 apartments in Shivkala Charms stating that these were illegally mortgaged by the bank.
4.12 It is further pleaded that in January 2014 it was reported on the website of newspaper Hindu that a builder in Delhi has been arrested for cheating 300 investors and arrest came after those who had invested money in the project named Shivkala Groups lodged complaints alleging that the company i.e. Golf Course Sahkari Awas Samiti cheated them in pretext of pre launch project.
4.13 It is further pleaded that he is not at all acquainted with Mr. Inderpal Singh who has been shown as his alleged power of Attorney as he had never appointed any person as his power of attorney and the documents on which his signatures were obtained by keeping certain portion of the documents blank were misused by the plaintiff for their oblique motive.
4.14 It is further pleaded that he has already lodged a complaint against the builder and the concerned bank officials with the concerned police station for taking appropriate action against them.
4.15 It is further pleaded that the present suit has been filed by the plaintiff on the basis of those documents which were unilaterally prepared by CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 12/ 28 the plaintiff and his signatures were obtained by saying that he will have no problem if he enjoys the possession of the suit property and discharges his duty of repaying the loan amount and as he had not even thought that he would be cheated by the bank and builder, he signed the documents without reading them. It is also pleaded that even otherwise as per the terms of tripartite agreement plaintiff has a right to get the allotment cancelled and take refund of the amount from defendant no. 3 and he has no objection if the plaintiff bank, as it has already taken steps for cancellation of the allotment of the suit property, takes refund of money from defendant no. 3.
4.16 It is further pleaded that as the suit property does not fall within the jurisdiction of this court, hence this court cannot entertain the present suit. It is further pleaded that this court also lacks jurisdiction in view of the Banks and Financial Institution Act 1993 as all cases of recovery of more than 10 lacs can only be filed before the Debts Recovery Tribunal.
4.17 It is further pleaded that the present suit filed against him is pre mature as plaintiff first should have tried to recover the amount from the builder and in case any amount remained deficient, the suit could have been filed against him for recovery of the balance amount.
4.18 It is pleaded that unconditional leave may be granted to contest the present suit.
CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 13/ 28 Reply to leave to defend application
5. In reply to the leave to defend application, while reiterating the contents of the plaint, plaintiff pleaded that defendant no. 1 has failed to bring forth any triable issues and accordingly the leave to defend application is liable to be dismissed.
Order
6. Heard the parties and perused the records.
6.1 The present suit has been filed by the plaintiff for recovery of outstanding loan amount. As per the plaintiff's case a tripartite agreement was entered into between it and defendant no. 1 & 3 on 26.04.2011 and accordingly the loan was granted to defendant no. 1 after execution of loan agreement by him on 02.05.2011 whereby he was alloted a loan account bearing no. 601705083. It is further the plaintiff's case that an amount of Rs. 34,80,000/ was disbursed to defendant no.3 i.e. the builder vide cheque bearing no. 83526 dated 30.04.2011. Execution of the tripartite agreement and availing of the loan facility has not been disputed by defendant no. 1. Defendant no. 1 unambiguously admits availing of the loan facility from the plaintiff as well as disbursal of the amount to defendant no. 3, in terms of the CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 14/ 28 loan and tripartite agreement. Same is writ large from the leave to defend application especially para 4, 5, 6 etc. 6.2 It is not even once denied in the leave to defend application that the loan facility was not so availed by him. It is also not claimed that the loan documents are forged or fabricated or that the terms and conditions were not agreed to by him. It is also not denied that the loan was to be repaid in 240 equated monthly installments. No dispute whatsoever has been raised regarding the outstanding amount as claimed by the plaintiff. In fact it would be safe to conclude that defendant no. 1 admits the plaintiff's case regarding advancement and non repayment of the loan amount.
6.3 The only limited defence put forth by defendant no. 1 is that he was cheated by plaintiff & defendant no. 3 who had connived with each other and trapped him. It is claimed by him that it was defendant no. 3 who had introduced the plaintiff to him through one of the plaintiff's official, who was there in the office of defendant no. 3 when he had visited the office of defendant no. 3 for purchase of the suit property, and it was only upon assurances of the said official that the plaintiff is satisfied regarding the ownership of the property, rules & regulations to be followed by the builder/developer that he availed the loan facility from it. However I find no merits whatsoever in the said contentions. The defence set up by defendant no. 1 does not disclose any triable issue nor does it even remotely entitles CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 15/ 28 him to defend the present case.
6.4 No collusion or connivance can be even remotely inferred from the leave to defend application or the other material available on record and in fact no such plea can be entertained in view of the tripartite and loan agreement available on record. Things would have been different had defendant no. 1 denied availing the loan facility from the plaintiff. Once he does not do so he cannot avoid his liability towards repayment of the loan.
6.5 Though defendant no. 1 claimed that he does not know defendant no. 2, who had purportedly signed the loan agreement as his power of attorney, however I find no merits in the said plea. Undoubtedly the loan agreement was not signed by defendant no. 1 however the same was duly signed on his behalf by defendant no. 2 who is/was his power of attorney holder. The original power of attorney executed by defendant no. 1 in favour of defendant no. 2 is available on record. Defendant no. 2 had also executed a promissory note on behalf of defendant no. 1. The original promissory note is also on record. Though defendant no. 1 claimed that he does not know defendant no. 2, has never been acquainted with him however a careful reading of para 16 of the leave to defend application would reveal that he has not even once claimed that the said power of attorney is a forged or fabricated one. It has not been claimed that the same does not bear his photograph or signatures or that the signatures on the same are forged and CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 16/ 28 fabricated. The power of attorney is duly attested, notarized and it has not been claimed that the said attestation, notarization is false or forged. It has only been claimed that his signatures "were obtained by keeping certain portion of the documents blank" and the same were misused with oblique motive. However such a plea cannot be entertained once signatures on the document stand duly admitted. Even otherwise the said plea is inconsistent with the plea taken in para 19 of the leave to defend application wherein defendant no. 1 has averred that the documents were unilaterally prepared by the plaintiff and he had signed them without reading the same. Furthermore once defendant no. 1 admits the availing of loan facility and has not claimed that any other loan documents were executed except the one which were signed on his behalf by his power of attorney the plea raised by him regarding the power of attorney falls flat. In fact as per the terms and conditions of the loan agreement he had admittedly paid 7 equated monthly installments to the plaintiff. This cut short the entire controversy.
6.6 Most importantly defendant no. 1 had admittedly executed an indemnity bond, original of which is available on record, whereby he had undertaken to repay the loan to the plaintiff as per the terms and conditions of the loan agreement as well as to indemnify the plaintiff towards any loss that may be direct or remote consequence of plaintiff's disbursing the loan amount to the defendant. This indemnity bond clinches the issue and completely puts to rest any controversy whatsoever regarding the power of CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 17/ 28 attorney as the indemnity bond was towards the very loan agreement i.e. loan agreement, loan account no. 601705083 signed by the attorney of the plaintiff i.e. defendant no. 2. The relevant clause of indemnity bond are reproduced hereunder: .....AND WHEREAS the Executant has requested HDFC to disburse the entire Loan irrespective of the stage of construction to the Builder;
AND WHEREAS HDFC has agreed to disburse the entire loan to the Builder at the request of the Executant for the Property irrespective of the stage of construction; AND WHEREAS the Executant seeks to indemnify HDFC Ltd. at all times for all/any loss that may be a direct or remote consequence of HDFC's disbursing the entire loan amount to the Executant;
NOW THIS DEED IS WITNESSETH that in consideration of HDFC Ltd.'s disbursing the entire loan amount to the Builder, the Executant hereby undertakes to repay the Loan regularly to HDFC as per the terms and conditions of the Loan Agreement dated irrespective of the date of possession being handed over by the Builder or what is mentioned in the said allotment agreement/flat buyers agreement/agreement to sell or in the event the Builder fails to hand over possession of the Property to the Executant.
6.7 It is also claimed in the leave to defend application that he had surrendered the flat to defendant no. 3 and requested it to pay the balance EMIs, loan amount from January 2012 onwards and had informed the plaintiff about the same while also informing it that henceforth it would be defendant no. 3 who shall be paying the remaining EMIs and that defendant no. 3 shall be foreclosing the loan by July 2012. It is claimed that defendant no. 3 had made a payment of Rs. 67,166/ to the plaintiff on his behalf which fact stands admitted by the plaintiff. It is his case that he had requested the plaintiff to issue NOC, closure letter of the loan account as he has surrendered the suit property to the builder however the plaintiff did not issue the same. However none of these facts raise any triable issue or merit CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 18/ 28 giving an opportunity to defendant no. 1 to contest the present suit.
6.8 The letter which defendant no. 1 so vehemently relied upon is available on record as annexure 1. The said letter which is addressed to defendant no. 3 and contents of which are reproduced hereunder not only proves that defendant no. 1 had availed the housing loan facility from the plaintiff but it also proves that for certain reasons he was unable to pay the balance EMIs. This letter also negates defendant no. 1's claim that there was some collusion between plaintiff and defendant no. 3 because not even once did defendant no. 1 claim, in the said letter, any such collusion or cheating or that it was the said collusion or cheating because of which he was surrendering the flat. The said letter reads as under:
"To The Secretary Golf Course Sahakari Awas Samiti Ltd.
D162, Sector 10, Noida (UP) Sub: Regarding Flat no. 4052, 5 th Floor allotted in the name of Sanchal Kumar Srivastava in 'Shivkala Charms' Greater Noida (U.P.) Dear Sir, As you are aware that I have taken housing loan from HDFC Ltd. For purchasing flat developed by you in the name of 'Shivkala Charms' at plot no.07, SectorPiII, Greater Noida.
Since the progress of the project is far below expectation, I am now unable to pay the balance EMI/housing loan due against the loan taken from HDFC Ltd. for the property. Hence, I hereby surrender the flat to the society. I would request you to please pay the balance EMI/loan outstanding from January 2012 onwards on my behalf directly to HDFC Ltd. Kindly acknowledge my application.
6.9 As far as annexure II or the purported mails dated 14.03.2012, 19.03.2012 and 04.09.2012, as are claimed to have been written to the CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 19/ 28 plaintiff, are concerned not only no collusion or cheating has been alleged in the said mails but furthermore the said mails or annexure 1 or annexure II as discussed above does not absolve defendant no. 1 of his liability repay the outstanding loan amount. Once the loan was duly availed by defendant no. 1, from the plaintiff, it is/was defendant no. 1's liability to repay the outstanding loan amount and under no circumstances he can avoid or deny his liability. Moreover plaintiff was not privy to the surrender documents and any surrender or cancellation without its consent cannot absolve defendant no. 1 of his liability.
6.10 Though defendant no.1 also relied upon clause 8 of the tripartite agreement however the said clause does not raise any triable issue nor effects defendant no. 1's liability to pay the outstanding amount. Clause 8 of the tripartite agreement is reproduced hereunder:
8. That if the Borrower fails to pay the balance amount representing the difference between the loan sanctioned by HDFC and the actual purchase price of the flat/residential apartment, or in the event of death of the Borrower or in the event of cancellation of the residential apartment for any reason whatsoever the entire amount advanced by HDFC will be refunded by the Builder to HDFC forthwith. The Borrower hereby subrogates all his rights for refund with respect to the said residential apartment in favour of HDFC.
6.11 The above clause contemplates various situations for example if there is any difference between the sanctioned loan and the actual purchase price of the suit property and the borrower fails to pay the said balance amount then it casts obligation upon the builder i.e. defendant no. 3 to pay the said difference, balance amount. It also casts obligations upon the builder CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 20/ 28 to return the sanctioned, advanced amount in case of the death of the borrower or the event of cancellation of the allotment of the suit property. It nowhere contemplates or casts obligation upon the builder i.e. defendant no. 3 to pay the EMIs towards the loan availed by defendant no. 1, in case of surrender of the suit property by defendant no. 1 if he is not satisfied with the progress of the construction of the suit property or in case he is unable to pay the EMIs.
6.12 In fact various clauses of tripartite agreement cast unambiguous obligations upon defendant no. 1 to repay the loan amount as per the loan agreement. Clause 3 and clause 4 of the tripartite agreement are reproduced hereunder:
3. The housing loan advanced to the borrower by HDFC shall be repayable by the borrower by way of Equated Monthly Installments (EMI). The date of commencement of EMI shall be the first day of the month following the month in which the disbursement of the loan will have been completed and consequently the due date of payment of first EMI shall in such a case be the last day of the said following month. Till the commencement of EMI the borrower shall pay PreEMI, which is the simple interest on the loan amount disbursed calculated at the rate of interest as mentioned in the respective loan agreement of the borrower.
4. That irrespective of the stage of construction of the Project and irrespective of the date of handing over the possession of the residential apartment to the Borrower by the Builder the Borrower shall be liable to pay to HDFC regularly each month the EMIs as laid down in the Loan Agreement to be signed by and between HDFC and the Borrower. The Borrower shall execute an indemnity and such other documents as may be required by HDFC in favour of HDFC in this regard.
6.13 As far as police complaints or the news articles are concerned, defendant no. 1 may take appropriate action against the builder for the lapses on its part but he cannot avoid his liability merely on the strength of those CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 21/ 28 complaints or news articles. Furthermore it has been discussed above that his contentions that plaintiff colluded with defendant no. 3 are absolutely mis founded, baseless.
6.14 As far as the plea regarding lack of territorial jurisdiction is concerned same is also meritless for the simple reason that the tripartite agreement was executed at Delhi, the loan agreement was also executed at Delhi and even the indemnity bond was executed at Delhi. In view of section 20 (c) of the CPC this court has the territorial jurisdiction to entertain and adjudicate the present dispute. Moreover the law is well settled that the debtor must seek the creditor. Reliance may be placed upon the law laid down in Satyapal vs Slick Auto Accessories Pvt. Ltd. & dated 05.03.2014 RSA No.40/2013 and CM 3203/2013(stay) and Maya Jain vs Yash Chhabra dated 27.04.2015 CS(OS) 2254/2013 & IA No.10525/2014.
6.15 As far as plea that the proceedings could have been initiated by the plaintiff only before the Debt Recovery Tribunal is concerned, same is also misconceived. Plaintiff is not a banking company nor it transacts business of banking in India. Therefore the present civil suit is maintainable. Reliance in this regard may be placed upon the law laid down in Housing Development Finance Corporation Ltd. Vs. Saiba Suri CS (OS) 1785/2010 dated 03.12.2012 and Housing Development Finance Corporation Ltd. Vs. Hemant Kumar Singh and anr CS (OS) 36/2013 dated 17.08.2015.
CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 22/ 28 6.16 At this stage I would like to highlight the observations made by the Hon'ble High Court of Delhi in Sandeep Kumar vs. Housing Development Finance Corporation Ltd and anr RFA (OS) 50/2015 dated 25.08.2015 wherein exactly similar defence was taken to avoid the liability under the loan however while dismissing the leave to defend application it was held as under:
11. Legal position as to the grant of leave to defend in a suit under Order XXXVII CPC was laid down by the Supreme Court in the decision reported as 1976 (4) SCC 687 M/s Mechelec Engineers & Manufacturers vs. M/s Basic Equipment Corporation, as under:
8. In Smt. Kiranmoyee Dassi and Anr. v. Dr. J. Chatterjee 49 C.W.N. 246 , Das. J., after a comprehensive review of authorities on the subject, stated the principles applicable to cases covered by order 17 C.P.C. in the form of the following propositions (at p. 253):
(a) If the Defendant satisfies the Court that he has a good defence to the claim on its merits the plaintiff is not entitled to leave to sign judgment and the Defendant is entitled to unconditional leave to defend.
(b) If the Defendant raises a triable issue indicating that he has a fair or bona fide or reasonable defence although not a positively good defence the plaintiff is not entitled to sign judgment and the Defendant is entitled to unconditional leave to defend.
(c) If the Defendant discloses such facts as may be deemed sufficient to entitle him to defend, that is to say, although the affidavit does not positively and immediately make it clear that he has a defence, yet, shows such a state of facts as leads to the inference that at the trial of the action he may be able to establish a defence to the plaintiff's claim the Plaintiff is not entitled to judgment and the Defendant is entitled to leave to defend but in such a case the Court may in its discretion impose conditions as to the time or mode of trial but not as to payment into Court or furnishing security.
(d) If the Defendant has no defence or the defence set up is illusory or sham or practically moonshine then ordinarily the Plaintiff is entitled to leave to sign judgment and the Defendant is not entitled to leave to defend.
CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 23/ 28
(e) If the Defendant has no defence or the defence is illusory or sham or practically moonshine then although ordinarily the Plaintiff is entitled to leave to sign judgment, the Court may protect the Plaintiff by only allowing the defence to proceed if the amount claimed is paid into Court or otherwise secured and give leave to the Defendant on such condition, and thereby show mercy to the Defendant by enabling him to try to prove a defence.
12. Before proceeding further it would be appropriate to note the terms of the Tripartite Agreement. The relevant clauses are reproduced as under:
"3. The housing loan advanced to the borrower by HDFC shall be repayable by the borrower by way of Equated Monthly Instalments (EMI). The date of commencement of EMI shall be the first day of the month following the month in which the disbursement of the loan will have been completed and consequently the due date of payment of first EMI shall in such a case be the last day of the said following month. Till the commencement of EMI the borrower shall pay PreEMI, which is the simple interest on the loan amount disbursed calculated at the rate of interest as mentioned in the respective loan agreement of the Borrower.
4. That irrespective of the stage of construction of the Project and irrespective of the date of handing over the possession of the residential apartment to the Borrower by the Builder the Borrower shall be liable to pay to HDFC regularly each month the EMIs as laid down in the Loan Agreement to be signed by and between HDFC and the Borrower. The Borrower shall execute an indemnity and such other documents as may be required by HDFC in favour of HDFC in this regard.
5. The Borrower shall ensure to pay to the Builder his own contribution in full i,e the cost of the flat minus the loan amount being disbursed by HDFC before availing of the disbursement from HDFC.
8. That if the Borrower fails to pay the balance amount representing the difference between the loan sanctioned by HDFC and the actual purchase price of the flat/residential apartment, or in the event of death of the Borrower or in the event of cancellation of the residential apartment for any reason whatsoever the entire amount advanced by HDFC will be refunded by the Builder to HDFC forthwith. The Borrower hereby subrogates all his rights for refund with respect to the said residential apartment in favour of HDFC.
9. Further if the Borrower commits a breach of any of the terms and conditions of this Tripartite Agreement it shall be treated as an event of default under the Agreement for Sale/Allotment cum Agreement for sale or any such agreement or document signed by and between the Borrower and the Builder for the sale of the said residential apartment.
CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 24/ 28 That in the event of occurrence of default under the Loan Agreement which would result in the cancellation of the Allotment as a consequence thereof and/or for any reason whatsoever if the allotment is cancelled, any amount payable to the Borrower on account of such cancellation shall be directly paid to HDFC. However it is further agreed between the Parties that such payment made by the Builder directly to HDFC shall not absolve the Borrower from his liability to pay the residual amount, if any, from the outstanding under the Loan Agreement.
That the Borrower agrees that it unconditionally and irrevocable subrogates its right to receive any amount payable by the Builder to the Borrower in the event of cancellation in favour of HDFC and that the act of payment by the Builder to HDFC under this clause shall amount to a valid discharge of the Builder of its obligation to pay the Borrower such cancellation amount.
Further that the parties agree that the Builder shall in no circumstances forfeit any amount over and above the amount equivalent to the Borrowers contribution towards the purchase consideration paid to the Builder. Borrower's contribution for the purpose of this clause shall mean and include the difference between the total cost of the residential apartment and the Loan amount as mentioned above.
10. Further, the Builder, in the in the event of default of repayment as mentioned in clause 2 and 3 hereinabove, shall on intimation by HDFC cancel the allotment of the residential apartment in favour of the borrower and refund all monies to HDFC directly under intimation to the borrower for appropriation and adjustment by HDFC against all monies due to it from the Borrower as mentioned above.
11. The Builder also confirms and undertakes that it shall submit to HDFC all documents for the Project as requested by HDFC and shall keep HDFC informed of the progress of the project and shall obtain a clearance from HDFC before handing over possession of the respective apartment to the borrower."
13. Further as per the Indemnity Bond executed by Sandeep Kumar he agreed to indemnify HDFC Ltd. at all times for all/any loss that may be a direct or remote consequence of and/or arising out of any dispute between the Indemnifier and the Builder subsequent to HDFC Ltd.'s disbursing the entire loan amount to the Builder at the request and under the written instruction of the Indemnifier.
14. Even if M/s Golf Course was to return the money directly to HDFC Ltd. and M/s Golf Course having not done so, the same does not absolve Sandeep Kumar of his liability. In the light of the clauses noted above and the indemnity bond, it is evident that Sandeep Kumar took upon himself the responsibility of indemnifying HDFC Ltd. and now he cannot revert back to say that it was the responsibility of M/s Golf Course to repay and thus HDFC Ltd. should recover the said amount from M/s Golf Course. This is an issue inter se Sandeep Kumar and M/s Golf Course for which HDFC Ltd. has no concern......
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16. No triable issue having been raised, the learned Single Judge committed no error in declining to grant the leave to defend.
6.17 Further reliance may be placed upon the law laid down in Housing Development Finance Corporation Ltd. Vs. Umesh Kumar Rai and anr CS (OS) No. 2894/2012 decided on 02.09.2014, Housing Development Finance Corporation Ltd. Vs. Sandeep Kumar and anr CS (OS) No. 2502/2012 decided on 11.03.2015 and Housing Development Finance Corporation Ltd. Vs. Ravinder Dhankar and anr CS (OS) No. 2108/2012 decided on 14.09.2015.
6.18 Therefore in view of above discussion leave to defend application of defendant no. 1 stands dismissed.
6.19 It has already been discussed above that defendant no. 2 did not file any appearance however it is to be seen that defendant no. 2 had merely signed the loan agreement and the promissory note on behalf of, as the power of attorney holder, of defendant no. 1. The loan was availed by defendant no. 1 and it was to be repaid by defendant no. 1. Therefore and in view of the tripartite agreement and the indemnity bond on record I am not inclined to pass any judgment against defendant no. 2 for recovery of the amount towards the loan availed by defendant no. 1.
6.20 As far as defendant no. 3 is concerned, as discussed above, no CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 26/ 28 leave to defend application was filed despite service of summons for judgment as is evident from proceedings dated 21.11.2013. Therefore in view of Order XXXVII Rule 3 (6) (a) CPC plaintiff is entitled to judgment forthwith. Moreover as per the tripartite agreement particularly clause 9 and 10, in the event of default of repayment, defendant no. 3 was to refund all the monies, advanced amount to the plaintiff for appropriation and adjustment by the plaintiff. Clause 10 is reproduced hereunder:
10. Further, the Builder, in the in the event of default of repayment as mentioned in clause 2 and 3 hereinabove, shall on intimation by HDFC cancel the allotment of the residential apartment in favour of the borrower and refund all monies to HDFC directly under intimation to the borrower for appropriation and adjustment by HDFC against all monies due to it from the Borrower as mentioned above.
6.21 Therefore suit of the plaintiff stands decreed to the extent that plaintiff is entitled to recovery of a sum of Rs. 36,58,756/ against defendant no. 1 and 3. Plaintiff is also entitled to interest @ 6% per annum from the date of filing of the suit till the recovery of decreetal amount. However considering the entire facts and circumstances of the case and in view of the observations made in Sandeep Kumar's case (supra) it is expected that plaintiff shall first try to execute the decree against defendant no. 3. I order accordingly.
7. Decree sheet be prepared accordingly.
CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 27/ 28
8. File be consigned to record room after necessary compliance.
Announced in the open Court (Gaurav Rao)
on 10th January 2019 ADJ02 & Wakf Tribunal /
New Delhi District,
Patiala House Courts, Delhi.
CS No. 59357/16 HDFC Vs. Sachal Kumar Srivastava and ors 28/ 28