Delhi District Court
J.P.P.C. Lease & Credit Ltd vs Ansal Housing & Construction Ltd on 25 January, 2020
IN THE COURT OF MS. ANJU BAJAJ CHANDNA,
DISTRICT JUDGE, (COMMERCIAL COURT)01,
PATIALA HOUSE COURT, NEW DELHI
CS (Comm) 57376/2016
J.P.P.C. Lease & Credit Ltd.
Through its Director
Mr. Siddhartha Premchand Gupta
34 Sri Ram Road, Civil Lines,
DELHI110054 .... Plaintiff
vs.
Ansal Housing & Construction Ltd.
15 - UGF, Indraprakash,
21 Barakhamba Road,
New Delhi110001. ....Defendant.
Date of Institution before Delhi High court : 25.05.2012
Date on which case transferred to District Courts : 11.01.2016
Arguments concluded on : 20.01.2020
Date of decision : 25.01.2020
Appearances: Sh.S.N. Mitra, ld. Proxy counsel for the plaintiff.
Sh.Attin Shankar Rastogi and Sh. Prateek Yadav, ld.
Counsels for the defendant.
JUDGMENT
Suit for Specific Performance:
1. The plaintiff company (through its director) has brought the present suit for specific performance of contract under Specific Relief Act 1963 and JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 1 of 31 also for compensation, with respect to the contract executed with the defendant. The resolution of the plaintiff company authorising its director to file is suit is placed on record.
2. It is the case of plaintiff that defendant company by issuing public advertisement in "Times of India" on 20.02.1996 made an open invitation to the public to invest in its project 'Imperial Tower' at Narayana Commercial Centre by booking shops/official space/showroom for consideration. The plaintiff, booked two units/flats bearing no. 312 (3 rd floor) area 480 Sq. feet, booking amount Rs.1,28,400/ and 611 (6 th floor) 535 Sq. feet, booking amount Rs.1,35,087/. The plaintiff company paid the booking amount through cheques and receipts were issued by the defendant. The plaintiff has been making regular payments towards the installments against the above mentioned two flats, but no allotment letter or agreement was given by the defendant. The plaintiff issued separate letters 17.07.1998 requiring the defendant to provide allotment letters/agreement and the defendant on 26.09.1998 sent the allotment letters for the said two flats. The plaintiff from time to time made payment of Rs.6,97,051/ (as against the total cost of Rs.13,50,875/) in respect of Flat No. 611 and Rs.6,61,392/ in respect of flat no. 312.
JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 2 of 31
3. Thereafter, plaintiff requested for surrender of flat No. 611, Imperial Tower, Naraina to which defendant agreed. The plaintiff requested vide its letter dated 21.07.2000 sent to the defendant to adjust amount of Rs.6,29,507/ (after deducting 5% of basic cost i.e. Rs.6,97,051.50 minus Rs.67,543.75) towards the cost of other flat no.312.
4. The defendant sent a letter dated 01.04.2002 to the plaintiff along with statement of account to the effect that possession of flat no.312 shall start after the full and final payment has been made. The defendant, however, arbitrarily increased the allotted area from 480 Sq.ft to 535 Sq.ft in utter disregard to the allotment letter dated 26.09.1998 and without prior intimation to the plaintiff. The defendant on account of excess area of 55 sq ft sought a further sum of Rs.4,22,619.78p and also sought the amount of Rs.94,505.75p on account of mutation, maintenance, security deposit and maintenance charges. The total balance claimed by the defendant was Rs.5,17,125.33p.
5. It is further the case of the plaintiff that in accordance with mutual agreed terms of allotment letter, plaintiff had made the payment to the defendant. The plaintiff negotiated with the defendant with respect to arbitrary demands and unilateral enhancement of area, but the defendant did JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 3 of 31 not respond. The defendant vide letter dated 15.03.2005 communicated to the plaintiff that allotment of flat no. 312 has been cancelled and also offered flat no.204 instead, in the same complex. The super area of flat no. 204 was stated to be 419 Sq.ft and the agreed cost of flat being Rs.13,81,334.20/. The defendant thus demanded a sum of Rs.90,435.20 from the plaintiff. The plaintiff through its representative visited the office of defendant and protested the unilateral change of allotment of flat and requested for rolling back the arbitrary demand and for giving the possession of the flat. The representative of the plaintiff made repeated visits to the office of defendant seeking delivery of possession of the flat but despite being assured that matter was being looked into and would be resolved nothing was done. The plaintiff felt aggrieved due to indifferent approach of the defendant and sent communication/ letter dated 18.08.2011. The plaintiff on visiting the complex, was shocked to know that flat no.204 was allotted and occupied by some third party. The plaintiff was then constrained to issue a letter dated 29.09.2011 to which, defendant responded vide letter dated 03.10.2011 informing that booking of the plaintiff had been cancelled on 20.05.2003 on account of nonpayment. The dishonest plea of the defendant about cancellation of the flats has been incontradiction to its letter dated 15.03.2005, whereby defendant was ready to allot an alternative flat bearing no. 204 instead of 312. The plaintiff was never informed about cancellation of JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 4 of 31 the flat in the year 2003 and plaintiff came to know about illegal cancellation only vide the letter of defendant dated 03.10.2011. The defendant never bothered to refund the money of the plaintiff although vide letter dated 03.10.2011 requested the plaintiff to surrender all documents for processing of the refund.
6. According to the plaintiff, defendant has not handed over the possession of alloted flat No.312 despite of payment of Rs.12,90,899 for which defendant was under an obligation. Plaintiff had always been ready and willing to maintain the payment schedule as agreed between the parties. The plaintiff has always been ready and willing to perform its part of contract and to pay the balance outstanding upon defendant rendering correct statement of price of the flat. The defendant however prevented the plaintiff from making over the payment by raising unjust demands.
7. In the light of aforesaid facts, the plaintiff has prayed for a decree of specific performance of contract dated 26.09.1998 (being the allotment letter issued by the defendant as modified by the letter of defendant dated 15.03.2005) and the defendant be directed to handover the possession and executed the conveyance deed in respect to flat No.204, Imperial Tower, Naraina Community Centre, New Delhi. The plaintiff has also sought JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 5 of 31 compensation in the sum of Rs.7 lakhs for delay in handing over the possession of the flat or to refund the money being Rs.12,90,899/ along with interest @24% per annum from the date of payment of amount by the plaintiff till the actual refund along with compensation.
8. The defendant has filed written statement taking preliminary submissions about maintainability of the suit and the same being devoid of merits. The objection as to the suit being barred by law of limitation has also been taken. The flat no.204, Imperial Tower, Naraina Community Centre is stated to have been allotted to third party Manish Poddar and Jyoti Poddar in the year 2006 and it is asserted that plaintiff has been a regular defaulter in making payments and has suppressed material facts from the court.
9. On merits, it is admitted that public advertisement was issued by the defendant being the Real Estate Developers. The factum of booking flats/units by the plaintiff is admitted but it is denied that plaintiff has been regularly making the payments thereof. It is also admitted that plaintiff surrendered flat no. 611. According to the defendant, plaintiff was not willing to pay the balance dues and to take the possession of the flat. It is denied that allotted area of the flat has been arbitrarily increased from 480Sq.ft to 535sq.ft without any prior intimation to the plaintiff. The clause one of allotment letter JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 6 of 31 dated 26.09.1998 has been referred to. The plaintiff admittedly received letter dated 01.04.2002, whereby offer for possession of flat no.312 was made on full and final payment, but plaintiff did not pay any attention to the same. The defendant has further denied that plaintiff held meetings and negotiated with the defendants or that the demands have been arbitrary or that there has been unilateral enhancement of area. No letter/email was written by the plaintiff showing any objection/resentment regarding the final statement of account.
The plaintiff did not reply to the defendants' request as he had no funds. According to the defendant, letter dated 15.03.2005 was issued by Ms. Ekta Gandhi (Marketing Executive) without due approval of management and therefore letter is legally untenable in the eyes of law. Plaintiff did not pay the balance dues qua flat no. 312, Imperial Tower, Naraina Community Centre and the same was allotted to some other person vide allotment letter dated 05.11.2004. It is denied that representatives of the plaintiff visited the office of the defendant several times. The plaintiff replied to the letter dated 15.03.2005 only vide its letter dated 18.08.2011 i.e. after a period of more than 6 years. The plaintiff did not abide with the terms and conditions of the allotment and to the subsequent letters sent by the defendants. The flat no.204 was allotted to some other person vide agreement dated 18.04.2006. Further denying all other averments of the plaint, it is submitted that plaint does not disclose any cause of action therefore no relief for specific JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 7 of 31 performance can be granted in favour of the plaintiff. The plaintiff even after receiving the offer for flat no.312 and alternative flat no. 204 neither accepted nor made any payment. It is prayed, that plaintiff is not entitled to any relief in the suit and therefore, same is liable to be dismissed.
10. Replication has also been filed by the plaintiff to the written statement of the defendant controverting the preliminary objections as not sustainable and further denying and controverting the averments of the written statement on its merits. The plaintiff has reiterated its averments contained in the plaint.
11. Affidavit of admission/denial of documents have been filed on behalf of defendant with respect to the documents filed and relied upon by the plaintiff.
12. On the basis of pleadings of the parties, following issues were framed vide order dated 15.01.2014:
1. Whether the plaintiff is entitled to specific performance of the contract/agreement dated 26.09.1998 as modified vide letter dated 16.03.2005? OPP
2. Whether the plaintiff was ready and willing to perform his part of the contract? OPP JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 8 of 31
3. Whether the suit is barred by limitation? OPD
4. Whether the defendant has allotted flat no.204, Naraina Community Centres, New Delhi in favour of the third party? If so, its effect. OPP
5. Whether the plaintiff is in the alternative entitled to refund of the money? If so, what amount and at what rate of interest? OPP
6. Relief.
13. Plaintiff has examined two witnesses to support its case.
14. PW1 Jagat Pal Gupta is the managing director of plaintiff company and has filed his affidavit in evidence Ex.PW1/A on the basis of board resolution Ex.PW1/1, duly authorising him to depose in the case. PW1 has deposed in terms of the averments of the plaint and has proved copy of advertisement dated 20.02.1996 Ex.P1, Receipt issued against flat No.312 Ex.P2; letters dated 17.07.1998 Ex.P3 and Ex.P4; allotment letters dated 26.09.1998 Ex.P5 and Ex.P6, letter dated 21.07.2000 Ex.P8, letter dated 01.04.2002 Ex.P9, letter dated 15.03.2015 Ex.PW1/2, registered letter dated 18.08.2011 Ex.P10; letter dated 26.08.2011 along with postal receipt Ex.PW 1/3, letter dated 29.09.2011 along with postal receipt Ex.PW1/4; letter dated 03.10.2011 Ex.PW1/5,letter dated 12.12.2011 Ex.PW1/6. The witness (PW
1) has been crossexamined at length.
JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 9 of 31
15. PW2 Sidharth Premchand Gupta is director of plaintiff company and has filed his affidavit in evidence Ex.PW2/A on the basis of board resolution Ex.PW2/1, duly authorising him to depose in the case. PW2 also supported its case and has deposed in terms of the facts asserted in the plaint. PW2 has also been crossexamined.
16. On behalf of defendant, DW1 Ms. Neha Aggarwal, authorized representative of the defendant company has tendered her affidavit in evidence Ex.DWA, on the basis of resolution Mark DW1/A. The witness deposed about allotment letter dated 05.11.2004 Mark DW/B for flat No.312 allotted to Mrs. Sonia Kwatra and flat buyer agreement dated 18.04.2006 Mark DW1/C for flat no.204 with Mr. Manish Poddar and Mrs. Jyoti Poddar.
17. Sh. Navtej Singh s/o Harcharan Singh, is the senior marketing executive of defendant company and has appeared as DW2 vide his affidavit in evidence Ex.DW2/A based on the board resolution Ex.DW2/1. According to the deposition of this witness, the allotment of unit no.312 was cancelled by the company due to defaults made by the plaintiff. As per records, unit no.204 has been alloted to Manish Poddar and Jyoti Poddar vide agreement dated 18.04.2006.
JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 10 of 31
18. Both the sides have submitted their written arguments along with relied upon judgments and counsel Sh. S.N. Mitra on behalf of plaintiff and counsels Sh. Attin Shankar Rastogi and Sh. Prateek Yadav on behalf of defendant advanced oral arguments before this court.
19. In support of his submissions, ld. Counsel for the plaintiff has relied upon following judgments:
• M/s M.R.F. Ltd. Vs. Manohar Parrikar & Ors., 2010 (4) SCALE 577; • Irmeet Singh Kohli & Ors Vs. Ashok Kumar Batra & Anr. 243 (2017) DLT 668;
• Rishi Aggarwal Vs. Vipul Infrastructure Developers Ltd. & Ors. 235 (2016) DLT 460;
• Panchanan Dhara & Ors. Vs. Monmatha Nath Maity (Dead) thr.L.Rs and Ors., MANU/SC/2787/2006.
• State Bank of India Vs. Kanhiya Lal & Anr. 2016 (157) DRJ 403.
20. In support of his submissions, ld. Counsel for the defendant has relied upon following judgments:
• Sobhag Narain Mathur Vs. Pragya Agrawal & Ors., 227 (2016) DLT 511;
• Dharampal Satyapal Ltd. Vs. Sanmati Trading and Investment Ltd.
& Ors., ILR (2014) 2 Delhi 1204;
• Padmakumari & Ors. Vs. Dasayyan & Ors., 2015 V AD (S.C.) 624; • Rajinder Valecha Vs. Satpal, 2018 SCC OnLine Del 6936; • Netrapal Singh Vs. Ravinder Kumar Kalyanai, 2019 SCC OnLine JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 11 of 31 Del 7677;
• Acharya Swami Ganesh Dassji Vs. Sita Ram Thapar, 1996 VAD(SC)67 and;
• Hira Lal Sharma Vs. Davinder Singh Lamba,
MANU/DE/2676/2012.
21. I have given due consideration to the pleadings of the parties, facts and circumstances of the case, evidence, documents and rival submissions.
22. My findings on the abovementioned issues are as follows:
Issue No. 1 and 2:
1. Whether the plaintiff is entitled to specific performance of the contract/agreement dated 26.09.1998 as modified vide letter dated 16.03.2005? OPP
2. Whether the plaintiff was ready and willing to perform his part of the contract? OPP Both the issues are taken up together as they are interconnected.
23. The present suit has been brought by the plaintiff company seeking specific performance of contract/agreement dated 26.09.1998, which is in the form of allotment letter as continued vide letter dated 15.03.2005.JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 12 of 31
24. The relevant legal provisions as provided under the Specific Relief Act 1963 are as follows:
Section 16 of Specific Relief Act, 1963 reads as under:
16. Personal bars to relief.--Specific performance of a contract cannot be enforced in favour of a person--
(a) who would not be entitled to recover compensation for its breach; or
(b) who has become incapable of performing, or violates any essential term of, the contract that on his part remains to be performed, or acts in fraud of the contract, or wilfully acts at variance with, or in subversion of, the relation intended to be established by the contract; or
(c) who fails to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than terms the performance of which has been prevented or waived by the defendant.
Explanation.--For the purposes of clause (c),--
(i) where a contract involves the payment of money, it is not essential for the plaintiff to actually tender to the defendant or to deposit in court any money except when so directed by the court;
(ii) the plaintiff must aver performance of, or readiness and willingness to perform, the contract according to its true construction.
Section 20 Specific Relief Act, 1963 speaks about discretion of the court in the following manner: JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 13 of 31
20. Discretion as to decreeing specific performance.-- (1) The jurisdiction to decree specific performance is discretionary, and the court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal.
(2) The following are cases in which the court may properly exercise discretion not to decree specific performance:--
(a) where the terms of the contract or the conduct of the parties at the time of entering into the contract or the other circumstances under which the contract was entered into are such that the contract, though not voidable, gives the plaintiff an unfair advantage over the defendant; or
(b) where the performance of the contract would involve some hardship on the defendant which he did not foresee, whereas its nonperformance would involve no such hardship on the plaintiff; or
(c) where the defendant entered into the contract under circumstances which though not rendering the contract voidable, makes it inequitable to enforce specific performance.
Explanation 1.--Mere inadequacy of consideration, or the mere fact that the contract is onerous to the defendant or improvident in its nature, shall not be deemed to constitute an unfair advantage within the meaning of clause (a) or hardship within the meaning of clause (b).
JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 14 of 31 Explanation 2.-- The question whether the performance of a contract would involve hardship on the defendant within the meaning of clause (b) shall, except in cases where the hardship has resulted from any act of the plaintiff subsequent to the contract, be determined with reference to the circumstances existing at the time of the contract.
(3) The court may properly exercise discretion to decree specific performance in any case where the plaintiff has done substantial acts or suffered losses in consequence of a contract capable of specific performance.
(4) The court shall not refuse to any party specific performance of a contract merely on the ground that the contract is not enforceable at the instance of the party".
25. It is well settled that remedy for specific performance is an equitable remedy. The Court while granting decree of specific performance exercises its discretionary jurisdiction. Section 20 of the Specific Relief Act specifically provides that Court's discretion to grant decree of specific performance is discretionary but not arbitrary. Discretion must be exercised in accordance with sound and reasonable judicial principles.
26. Normally, a suit for specific performance of an agreement for sale of immovable property involves the question whether the plaintiff was ready and willing to perform his part of the contract in terms of Section 16 of the Specific Relief Act, whether it was a case for exercise of discretion by the court JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 15 of 31 to decree specific performance in terms of Section 20 of the Specific Relief Act and whether there were laches on the part of the plaintiff in approaching the court to enforce specific performance of the contract. In some cases, a question of limitation may also arise in the context of Article 54 of the Limitation Act on the terms of the agreement for sale. Other questions like the genuineness of the agreement, abandoning of the right to specific performance, a novation and so on, may also arise in some cases.
27. The sequence of facts and events of the present case are as follows:
• The advertisement was published by the defendant on 20.02.1996 (Ex.P1) in response to which two units were booked by the plaintiff bearing no. 611 and 312.
• The allotment letters Ex.P5 and Ex.P6 dated 26.09.1998 were issued and terms and conditions of allotment have been detailed therein. • The plaintiff applied for surrender of unit no. 611 vide letter dated 21.07.2000 (Ex.P7) also seeking adjustment of the payment towards unit no. 312.
• Vide letter dated 01.04.2002 (Ex.P9) possession of unit no. 312, Imperial Tower, was offered and plaintiff was called upon to make full and final payment as per statement of account.
JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 16 of 31 • Vide letter dated 15.03.2005 (Ex.PW1/2) defendant offered unit No. 204 Imperial Tower in place of cancelled unit 312 and as per the details of the letter, balance amount payable was Rs.90,435/. • On 18.08.2011 and 26.08.2011, plaintiff sent letters (Ex.P10) to the defendant seeking final statement of account and possession of the unit. Also vide letter dated 29.09.2011, plaintiff sought possession of the unit or to take legal recourse.
• Vide letter dated 03.10.2011 (Ex.PW1/5) defendant declined to give possession stating that letter dated 15.03.2005 was not issued with due approval from management and even otherwise the letter has not been accepted by the plaintiff as remaining outstanding dues have not been paid.
• Lastly, vide letter dated 12.12.2011 (Ex.PW1/6) final notice was sent on behalf of plaintiff to the defendant, also cautioning to take legal recourse.
28. In order to grant specific performance of a contract, the plaintiff essentially has to show and establish before the court that the has performed or has always been ready and willing to perform the essential terms of the contract.
JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 17 of 31
29. As per settled legal position, there is distinction between "readiness" and "willingness" to the effect that the former refers to financial capacity and later to the conduct of the plaintiff seeking performance. In other words, the 'readiness' and 'willingness' on the part of plaintiff is a condition precedent to grant the relief of specific performance. The onus has been upon the plaintiff, in a given case that he has always been ready and willing to perform his part of contract.
30. In the present case, allotment letter Ex.P6 dated 26.09.1998, vide which commercial premises referred to as Flat No.312 area 480 sq. feet on 3 rd floor, was alloted to the plaintiff, contains the terms and conditions agreed upon by the parties. The relevant terms are as follows:
1. The allotment is 'Provisional'. The plans are yet to be sanctioned. If for any reason, any further changes are to be made by the sanctioning authorities or by the architects of the Builder resulting in reduction or increase in the above mentioned super area or its location, no claim, monetary or otherwise will be raised or accepted except that the aforementioned rate per sq. ft. will be applicable on the changed area.
In case of absolute deletion of flat no. claim, monetary or otherwise will be raised or accepted except that the amount received shall be refundable in full without interest.
2. If the number of flat changes or area of the flat or its location, the final reallocation will be done by the builder whose decision will be JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 18 of 31 final and binding on the flat buyer.
3. The present allotment is subject to the conditions that there is no price control/restrictions from any authorities. In case of any control or any other restrictions on the price of the flat being imposed by any authority, this allotment will be liable to be cancelled by the Builder in its sole discretion and the money deposited by the flat buyer will be refundable without any interest. No claim, monetary or otherwise shall be raised by the flat buyer or accepted by the builder in this regard.
4.....
5 (a).....
(b)....
(c)....
(d) Rate changed above for the area of the flat are for what is commonly known as "Super Area" i.e. for the covered area including walls, cupboard, window projections and balconies plus proportionate share of areas under stair cases, common areas, walls, lifts, shafts, water supply arrangements and other common facilities etc.
6.....
7.....
8.....
9.....
10 (a) Construction cost may show escalation. The rate per sq.ft. of the saleable space fixed above has been based on costs as on 19 February 1996. This however, shall stand enhanced if the cost of construction increases. The increase in cost of construction shall be calculated on the basis of the proportionate increase in the building JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 19 of 31 cost indices for Delhi as followed by CPWD from time to time. The cost of construction being a part of the sale price, will be calculated by the following equation.
Final sale price :sale price per sq.ft as recorded above PLUS the following per sq. ft.
Cost index on the date of completion Rs. 500 X ___________________________________________ 1 cost index on 19.02.1996
(b) The cost index will be as applicable to the plinth area rates for Delhi and as followed/laid down by CPWD from time to time. The decision of the builder on the increased cost of construction shall be binding and final. The increased incidence may be charged and recovered by the builder from the buyer with any one or more of the installments or separately. This clause shall apply only for escalation and nothing contained herein shall entitle any reduction. There will be no liability to render accounts.
(c)....
(d)....
11.....
12....
13...
14....
15. Possession of the flat shall be given after obtaining sanctions from all competent authorities and also after receiving all payments as demanded by the builder as per the terms of allotment/agreement.
16. The maintenance, upkeep, repairs, security etc. of the building will be organised by the builder or its nominee. The flat JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 20 of 31 buyer agrees and consents to the said arrangement. The flat buyer shall pay maintenance charges which will be fixed by the builder or its nominee from time to time depending upon the maintenance cost. In addition to maintenance charges, there will be contribution to the replacement fund etc. Any delay in payments will make the flat buyer liable for interest @ 24% per annum. Nonpayment of any of the charges within the time specified shall disentitle the flat buyer to the enjoyment of common services in such building. The builder has entrusted for the present the work of maintenance, upkeep and preservation of the building, operation of common services and necessary/desirable facilities for its occupiers/ visitors and management of the common area thereof to Star Estates Management Ltd., 115 Ansal Bhawan, 16 Kasturba Gandhi Marg, New Delhi 110001 hereinafter called SEML, as Builder's nominee. This is a permanent arrangement whether or not the building is transferred to a Cooperative Society, other body corporate etc.
31. The above mentioned terms and conditions are clear and specific and although they are advantageous in favour of defendant, but the transaction of allotment of unit has been based on the same. The discretion vested in the defendant to raise claim of excess payment in the event of variation/change in the area of flat/unit.
32. In evidence, PW1 Jagat Pal Gupta has admitted that no payment was made by the plaintiff after receiving letter dated 01.04.2002. It is also admitted that no reply to the said letter was sent to the defendant although, JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 21 of 31 Mr. Bansal representative of the plaintiff visited the office of the defendant. The plaintiff has pleaded that defendant has arbitrarily and unilaterally increased the area of the unit and claim of enhanced payment was not justified. However, the plaintiff voluntarily agreed to the terms of allotment letter (Ex.P6) and subsequent objections as to the fairness of the said terms and conditions could not be legally raised. The offer of the defendant to have the possession of unit 312 was not accepted and complied with by the plaintiff and at no point of time the balance payment was deposited with the defendant. Admittedly, no communication was sent to the defendant raising any objection as to the terms of the letter dated 01.04.2002 (Ex.P9). In this way, plaintiff has failed to show that plaintiff had been ready and willing to perform its part of contract or that defendant deliberately or dishonestly prevented completion of performance of the contract.
33. Coming to the letter dated 15.03.2005 (Ex.PW1/2), even if the same is taken as extension of letter dated 01.04.2002 (Ex.P9), the defendant replaced the unit no.204, but as per statement of account detailed in the said letter, an amount of Rs.90,435.20p was payable by the plaintiff. PW1 has admitted that even after receiving letter dated 15.03.2005, no payment was made by the plaintiff. According to the PW1, there was no question for making any further payment since they had already made excess payment of JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 22 of 31 Rs.8,000/. Interestingly, no communication raising the objections towards letter dated 15.03.2005 was issued or sent by the plaintiff.
34. The conduct of the plaintiff is evident that even after receiving letter dated 15.03.2005, no efforts were made to perform its part of contract in terms of original allotment letter Ex.P6.
35. In N.P. Thirugnanam (D) by L.Rs. vs. Dr. R. Jagan Mohan Rao & Ors. AIR 1996 SC 116, Supreme Court has held as under:
"Section 16(C) of the Act envisages that the plaintiff must plead and prove that he had performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than those terms the performance of which has been prevented or waived by the defendant. The continuous readiness and willingness on the part of the plaintiff is a condition precedent to grant the relief of specific performance. This circumstance is material and relevant and is required to be considered by the court while granting or refusing to grant the relief. If the plaintiff fails to either aver or prove the same, he must fail. To adjudge whether the plaintiff is ready and willing to perform his part of the contract, the court must take into consideration the conduct of the plaintiff prior and subsequent to the filing of suit along with other attending circumstances. The amount of consideration which he has to pay to the defendant must of necessity be proved to be available. Right from the date of the execution till date of the decree he must prove that he is ready and has always been willing to perform his part of the contract. As stated, the factum of his readiness and willingness to JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 23 of 31 perform his part of the contract is to be adjudged with reference to the conduct of the party and the attending circumstances. The court may infer from the facts and circumstances whether the plaintiff was ready and was always ready and willing to perform his part of the contract".
36. It has been repeatedly pleaded by the plaintiff that its representative particularly Mr. Bansal paid multiple visits to the office of the defendant and issue of excess payment on account of increased area was taken up, but even then the defendants have dishonestly allotted the units to the third parties. Even if it is assumed to be correct, visiting the office of defendant multiple times would not give any relaxation to the plaintiff to prolong the performance of its part of contract, nor the same would extend the time period of payment.
37. The basic document on which the present suit is based is the allotment letter (Ex.P6). The terms and conditions of the said letter gives preferential rights to the defendant to seek enhanced prices from its buyers even as the allotment was provisional. The said terms and conditions were not fulfilled by the plaintiff as enhanced payment was never paid or deposited. Therefore, it is concluded that plaintiff has not been willing to perform the essential terms of the contract and therefore, the possession of the units/flats JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 24 of 31 could not be kept in abeyance for an indefinite period by the defendant.
38. It is obvious from the facts of the case that plaintiff has not been ready and willing to perform the part remaining to be performed by the plaintiff under the contract. Also, there has been undue delay on the part of the plaintiff to respond to the communications issued by the defendant vide various letters. It is further evident that both the units i.e. 312 and 204 have been allotted by the defendant to third parties on 05.11.2004 and 18.04.2006 respectively. In such circumstances, the specific performance is otherwise not justified and would involve undue hardship to the defendant as well as to the third parties who have entered into the properties by virtue of their independent rights.
39. I therefore conclude that plaintiff is not entitled to specific performance of the contract/agreement and the issue is decided in favour of the defendant and against the plaintiff.
Issue No.3 "3. Whether the suit is barred by limitation? OPD"
40. By way of present suit, plaintiff has sought the relief of specific performance of the contract along with compensation in sum of Rs.7 lakhs and JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 25 of 31 alternatively for refund of money paid by the plaintiff towards purchase of units in question i.e. Rs.12,90,899/ along with interest @24% per annum compounded annually.
41. It is contended by counsel for the defendant that suit brought by the plaintiff is barred by law of limitation. The plaintiff could file the suit for specific performance within a period of three years and even if the limitation is taken w.e.f. letter dated 15.03.2005 (Ex.PW1/2), the suit has been filed in the year 2012. The letters dated 26.08.2011 and 29.09.2011 Ex.PW1/3 and Ex.PW1/4 would not give any extension to the period of limitation. The defendant in its letter dated 03.10.2011 Ex.PW1/5 clearly informed the plaintiff that scope of limitation could not be enlarged by virtue of the letters.
42. On the other hand, ld. Counsel for the plaintiff submitted that suit has been brought well within the period of limitation. The plaintiff has been continuously negotiating with the defendant with respect to the possession of the booked unit as the defendant had raised arbitrary claim on account of enhanced area.
43. On giving due consideration to the peculiar facts and circumstances of the case and the legal position, I am of the opinion that suit of the plaintiff JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 26 of 31 is within the period of limitation. According to Article 54 of Schedule attached to the Limitation Act 1963, the suit for specific performance of a contract can be filed within a period of three years from the date fixed for performance or, if no such date is fixed, when the plaintiff has notice that performance is refused.
44. In the present case, the first offer for possession of unit was given by the defendant vide letter dated 01.04.2002 (Ex.P9) with respect to flat no. 312 and subsequently fresh offer of unit No.204 was sent vide letter dated 15.03.2005 (Ex.PW1/2). In between no intimation about cancellation or about subsequent allotment to third party of unit 312 was given to the plaintiff. Even, after issuance of letter Ex.PW1/2 no communication was sent to the plaintiff about cancellation of the unit no.204. It is only vide letter dated 03.10.2011 (Ex.PW1/5) that request for possession was declined by the defendant.
45. On examining the terms and conditions of allotment letter (Ex.P6), I find that no date for performance of the contract is fixed therein and therefore, the limitation would start, when the plaintiff noticed that performance has been refused. Even in the letters dated 01.04.2002 and 15.03.2005 no time period has been specified about making the final payment JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 27 of 31 for taking the possession of the units. The refusal therefore would be taken from the date 03.10.2011 (Ex.PW1/5) and suit has been brought well within the period of limitation.
46. The counsel for defendant has also raised an argument that even for refund of plaintiff's money, the suit is barred by limitation. However, this argument is not acceptable as by virtue of letter dated 03.10.2011, defendants themselves offered for processing the refund of money to the plaintiff as per company's policy on deposition of all original receipts. Even otherwise, the issue of refund would come into play only when the specific performance is refused which in this case for the first time was refused on 03.10.2011.
47. In the result, I hold that suit is not barred by law of limitation. The issue is decided in favour of the plaintiff.
Issue no.4.
"4. Whether the defendant has allotted flat no.204, Naraina Community Centres, New Delhi in favour of the third party? If so, its effect. OPP"
48. It is evident from the evidence of DW1 and DW2 that the flat JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 28 of 31 no.204 stands allotted to third party i.e. Manish Poddar and Jyoti Poddar. The flat buyer agreement mark DW1/C has already been placed on record. There is no reason to disbelieve or discard this part of evidence of the defendant and it stands substantially proved that flat/unit no.204, Imperial Tower, Narayana Commercial Centre stands allotted in favour of third party.
49. The effect thereof is clear that specific performance of the allotment of flat no.204 could not granted as it would involve undue hardship not only to the defendant but also to the third parties who are bonafide purchasers of the property in question. This issue is disposed of accordingly. ISSUE NO.5:
"5. Whether the plaintiff is in the alternative entitled to refund of the money? If so, what amount and at what rate of interest? OPP"
50. It is admitted case of both the sides that plaintiff has paid an amount of Rs.12,90,899/ to the defendant as also confirmed vide letter Ex.PW1/2. The defendant has disputed this letter by stating that it has not been issued with the approval of the management but letter has been drawn on the letter head of the defendant and has been signed by Marketing JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 29 of 31 Executing Ms. Ekta Gandhi. The defendant can not be allowed to disown this letter. Even otherwise, payment of Rs.12,90,899/ by plaintiff stands not disputed.
51. Since the plaintiff despite payment of Rs.12,90,899/ could not get the unit in question, (although due to nonpayment of extra charges raised by the defendant) it is just and equitable that refund of the plaintiff's money is done by the defendant at the earliest. Accordingly, the plaintiff is entitled to the refund of its money.
52. So far as rate of interest is concerned, it would meet the ends of justice if the plaintiff is given interest @ 7% per annum from date of allotment of unit 204 to third party i.e. 18.04.2006, as defendant should have informed to the plaintiff about cancellation of unit 204 and should have offered refund of money. Accordingly, I order that plaintiff is entitled to interest @ 7% p.a. from 18.04.2006 till the payment of the principal amount of Rs.12,90,899/. Relief
53. In view of the findings with respect to above issues, suit of the plaintiff is decreed on the following terms:
JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 30 of 31
• The defendant to repay principal amount of 12,90,899/ in favour of the plaintiff along with interest calculated @7% per annum w.e.f.
18.04.2006 till actual payment.
54. Parties are left to bear their own costs.
55. The decree sheet be drawn accordingly.
56. File be consigned to record room.
ANNOUNCED IN THE OPEN COURT on 25th January 2020 ANJU BAJAJ CHANDNA District Judge (Commercial Court)01 Patiala House Court, New Delhi.
25.01.2020 JPPC Lease and Credit Ltd. Vs. Ansal Housing and Construction Ltd. Page 31 of 31