Delhi District Court
Sh Om Prakash vs M/S Magestic Crown Banquet on 22 April, 2026
IN THE COURT OF DISTRICT JUDGE-08 WEST, TIS HAZARI
COURTS, DELHI
Presided by: Ms. Susheel Bala Dagar
Civ DJ 583/22
CNR Number: DLWT01-006172-2022
In the matter of:
Shri Om Prakash
S/o Shri Ram Prakash
R/o A/296/2 Shastri Nagar,
Delhi. ..... Plaintiff
Versus
M/s Majestic Crown Banquet
(Unit of Divine Hospitality)
Through its Owner/ Director/ Partner/ MD
Plot No. 24, Shivaji Marg,
Najafgarh Road, Delhi ..... Defendant
Date of institution : 04.07.2022
Date of reserved for judgment : 10.04.2022
Date of judgment : 22.04.2026
Suit for recovery of money of Rs. 3,61,000/- with costs, pendente lite and
future interest
JUDGMENT
Brief facts of the case
1. The plaintiff averred that the defendant operates a banquet business under the name "Majestic Crown Banquet (A Unit of Divine Hospitality)"
and provides space for social functions. The plaintiff booked the banquet hall (ground and first floor) on 04.07.2021 for his daughter's wedding scheduled on 29.12.2021 for a total consideration of Rs. 4,21,000/-, out of which he paid Rs. 3,61,000/- in multiple installments between July and December 2021. However, due to restrictions imposed by the Delhi Government on 28.12.2021 amid the third wave of the COVID-19 Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 1 of 23 Digitally signed by SUSHEEL SUSHEEL BALA DAGAR BALA Date:
2026.04.22 DAGAR 17:37:07 +0530 pandemic, limiting gatherings to 20 persons, the plaintiff was compelled to conduct the marriage at home in a restricted manner. Upon learning of these restrictions, the plaintiff immediately informed the defendant and requested a refund, and the defendant initially assured that the amount would be refunded within seven days.
2. The plaintiff further submits that despite repeated follow-ups, the defendant delayed the matter on various pretexts and ultimately refused to refund the amount, instead offering adjustment of the paid sum against a future booking, which the plaintiff declined as he had no upcoming function. The plaintiff contends that since the function could not be held due to government-imposed restrictions, the defendant is legally bound to refund the amount, especially in view of directions issued to banquet operators during the pandemic. The plaintiff also submits that a legal notice was sent on 10.03.2022, but no refund or reply was received.
3. It is further submitted that the cause of action arose from the initial booking and subsequent payments, the imposition of restrictions on 28.12.2021, the defendant's refusal to refund, and the failure to respond to the legal notice, and that it continues to subsist. The plaintiff asserts that the suit is within limitation, there is no collusion, and the Court has proper jurisdiction as the parties reside and transact business in Delhi. Accordingly, the plaintiff seeks a decree for recovery of Rs. 3,61,000/- along with 18% annual interest, costs and legal expenses.
Written Statement of defendant.
4. The defendant, through its authorized representative Amit Arora, Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 2 of 23 Digitally signed SUSHEEL by SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:37:12 +0530 Accounts Manager of M/s. Divine Hospitality, submitted that he is duly empowered to represent and defend the present case and is fully aware of its facts. The defendant denied all allegations made in the plaint unless specifically admitted and raised several preliminary objections. It is contended that the suit is not maintainable before the present Court as the dispute falls within the definition of a commercial dispute under the Commercial Courts Act, 2015, and therefore only a Commercial Court has jurisdiction. The defendant further submitted that the suit suffers from non-joinder and mis-joinder of necessary parties since the plaintiff filed the case against "Majestic Crown Banquet," which is merely a unit, instead of M/s. Divine Hospitality, the actual partnership firm. It is also claimed that the suit lacks any valid cause of action, is an abuse of legal process, and has been filed with mala fide intent to harass and extract money. The defendant alleged that the plaintiff has suppressed material facts, including the terms and conditions of booking, which clearly mention that the advance payment is non-refundable and that the hotel is not liable in case of cancellation due to unforeseen circumstances such as government restrictions.
5. On merits, the defendant admitted that the plaintiff booked only the ground floor of the banquet hall and made payments as stated but emphasized that the plaintiff deliberately concealed the full booking document containing non-refundable conditions. While acknowledging the government circular dated 28.12.2021 restricting gatherings, the defendant denied that the marriage was conducted at home and instead asserted that the plaintiff had informed via WhatsApp that the marriage Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 3 of 23 Digitally signed SUSHEEL by SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:37:17 +0530 was postponed. The defendant further denied that any request for refund was made immediately or that any assurance for refund was given. Rather, the first request for refund was made on 09.01.2022, which was declined in accordance with the agreed terms, though an option for future adjustment was offered on humanitarian grounds. It is also submitted that due to prior arrangements and expenses incurred for the event, refunding the amount was not feasible, especially since the cancellation occurred just a day before the scheduled function.
6. The defendant denied all other allegations regarding delay, false assurances, or liability to refund, and disputed the claim that any government directive mandated refund in such cases. While acknowledging receipt of the legal notice, it is termed baseless and without merit. The defendant reiterated that no cause of action arose in favor of the plaintiff, that the suit is not maintainable, and that the plaintiff is not entitled to any relief.
Issues :-
7. From the pleadings of the parties and material on record, following issues were framed by Ld. Predecessor vide order dated 07.07.2023 :-
Issue no. 1 Whether the plaintiff is entitled to a decree for recovery of Rs. 3,61,000/- alongwith pendete lite interest @ 18% p.a.? OPP Issue no. 2 Whether the plaintiff is also entitled to the costs of suit? OPP Issue no. 3 Whether the suit is bad for non joinder of the necessary party? OPD Issue no. 4 Relief.
Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 4 of 23 Digitally signed by SUSHEEL SUSHEEL BALA DAGAR BALA Date: 2026.04.22 DAGAR 17:37:22 +0530 Plaintiff Evidence PW1/Sh. Om Prakash
8. PW1 tendered his evidence by way of affidavit Ex. PW1/X and relied upon the following the documents : copy of quotation/estimate dated 04.07.2021 Ex. PW1/A, payment receipts dated 04.07.2021, 02.12.2021 & 18.12.2021 Ex. PW1/B, copy of payment receipt dt. 25.10.2021 Mark A, legal notice and receipts Ex. PW1/C, copy of proof of e-mail Mark B, copy of Notification of Govt. of NCT of Delhi Mark C.
9. During cross-examination, the plaintiff/PW1 admitted that he had read and accepted the brochure, estimate, and terms and conditions of "Majestic Crown Banquet" at the time of booking and confirmed that he had actually booked only the ground floor, not the first floor, contrary to what was stated in his plaint and affidavit, which he claimed he had not read properly. He further acknowledged that as per the agreed terms, the advance amount was non-refundable in case the function could not be held due to an act of God or legal restrictions, although he volunteered that the function was cancelled by the banquet authorities due to lockdown. The plaintiff also admitted that he had informed the defendant via WhatsApp on 28.12.2021 that the marriage was postponed due to lockdown and did not communicate again until 09.01.2022, when he stated that the marriage had been conducted at home, and at that time the defendant clearly refused refund and offered only adjustment, which is reflected in the record.
10. PW1 conceded that he had not produced any documentary proof of the marriage being conducted at home, nor any government notification Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 5 of 23 Digitally signed SUSHEEL by SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:37:29 +0530 directing banquet halls to refund amounts due to COVID-19 restrictions, and also admitted that he had not placed on record any evidence showing that the defendant had assured a refund as claimed in his pleadings. He further acknowledged that certain facts stated during his testimony, including alleged cancellation by the banquet and personal visits to the defendant, were not mentioned in his plaint or affidavit. Despite these admissions, the plaintiff denied suggestions that he had voluntarily cancelled the function. PW1 denied that he was not entitled to any refund due to agreed non-refundable terms. He denied that the suit was not maintainable or that his claim was false, fabricated, or filed with mala fide intent.
PW-2/Sh. Dheerendra Prakash Deepak, son-in-law of the plaintiff
11. He tendered his evidence by way of affidavit Ex. PW2/A. During cross-examination, PW-2 stated that he did not accompany his father-in-law, Sh. Om Prakash, at the time of booking the Majestic Crown Banquet on 04.07.2021 and was not aware whether both the ground and first floors were booked for the wedding. He admitted that no payment was made in his presence and that he had no knowledge of the terms and conditions of the booking. He further clarified that the statements made in his affidavit were based solely on information provided by his father-in-law after the lockdown was imposed and that he had no personal knowledge of the facts stated therein. PW-3/ Ms. Dolly, daughter of the plaintiff.
12. She tendered her evidence by way of affidavit Ex. PW3/A Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 6 of 23 Digitally signed SUSHEEL by SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:37:35 +0530 During cross-examination, PW-3 stated that she had accompanied her father, Sh. Om Prakash, at the time of booking Majestic Crown Banquet Hall on 04.07.2021 and confirmed that only the ground floor was booked for her marriage. She recalled that booking-related documents such as the menu form, booking form, and estimate form were provided at that time and identified a blank estimate form as being similar to the one on record. She further stated that she was present on most occasions when advance payments were made, both in cash and online, and acknowledged that receipts were issued for cash payments and were accepted without objection. However, she admitted that she had not filed any documentary proof to show that her marriage was conducted at home on 29.12.2021, while denying suggestions that her marriage did not take place on that date or that her affidavit was false or fabricated.
13. PW-4/ Sh. Devinder Mohan, Section officer from the office of Divisional Commissioner, 5 Samnath Marg, Delhi produced certified copies of the government orders dated 28.12.2021 issued by the Principal Secretary (Revenue), Divisional Commissioner, and dated 08.08.2021 issued by the Chief Secretary, Delhi, Ex PW-4/A and Ex PW-4/B respectively regarding order of alert dated 28.12.2021 whereby the permitted / prohibited / restricted activities specified as Level I (Yellow) DDMA, vide Order no. 460 dated 08.08.2021 would be enforced with immediate effect till further orders i.e there was night curfew on movement of persons during 10.00 pm to 5.00 am throughout the NCT of Delhi as well as restrictions on social gatherings.
During cross-examination, PW-4 stated that he had no role in the Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 7 of 23 Digitally signed SUSHEEL by SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:37:41 +0530 decision-making process for issuing documents Ex PW-4/A and Ex PW-4/B and had no personal knowledge regarding those documents, while denying the suggestion that he was deposing falsely.
After cross examination, plaintiff evidence was closed. Defendant Evidence:-
DW1/Sh. Amit Arora, AR of M/s. Divine Hospitality
14. DW1 tendered his evidence by way of affidavit Ex DW1/A and relied upon the following documents : authority letter dated 16.09.2022 issued in his favor by partnership firm namely M/s. Divine Hospitality Ex. DW-1/1, printout of WhatsApp message dated 28.12.2021 already marked as Mark A, whatsApp message dated 09.01.2022 already Ex.
PW-1/D1, affidavit under Section 65B of Indian Evidence Act Ex. DW-1/2.
15. During cross-examination, DW-1, Amit Arora, stated that no formal minutes were recorded by the partners authorizing him, but denied that he was not duly authorized to depose on behalf of the firm. He confirmed that he had gone through his affidavit, had been working as Accounts Manager since August-September 2020, and produced his Aadhaar card for identification, stating that the firm does not issue identity cards. He admitted that on 28.12.2021, the government imposed COVID-19 restrictions on gatherings and that thereafter no functions were organized by the defendant firm. He also acknowledged that the plaintiff had paid Rs. 3,61,000/- as advance against a total booking amount of Rs. 4,21,000/- for the marriage scheduled on 29.12.2021.
16. DW1 further stated that the plaintiff demanded refund only through Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 8 of 23 Digitally signed by SUSHEEL SUSHEEL BALA DAGAR BALA Date:
2026.04.22 DAGAR 17:37:47 +0530 WhatsApp messages and denied that the plaintiff visited the office multiple times. He admitted that no formal agreement was signed between the parties, though terms and conditions were part of the estimate/brochure already exhibited on record, which did not bear signatures of either party. He also acknowledged that payment receipts were signed only by the booking clerk and not by the plaintiff. DW1 confirmed that the WhatsApp chats relied upon were from an official phone not in his possession and that he had no personal knowledge of those chats at the time they were made. He maintained that there was no government notification mandating refund of booking amounts during COVID-19 restrictions and denied that the plaintiff cancelled the function, asserting instead that it was postponed as per the message received.
17. DW1 admitted that the plaintiff informed about the marriage on 09.01.2022 via WhatsApp but denied that any telephonic or personal request for refund was made. He also denied all suggestions that no terms and conditions existed, that no commitments were made regarding non- refund, or that he was deposing falsely, reiterating the defendant's stand that the claim for refund was not justified.
After cross-examination, defendant evidence was closed. Final arguments
18. I have heard Shri Pramod Tripathi, Ld. Counsel for plaintiff and Shri Vipul Srivastava, Ld. Counsel for defendants and perused the record.
Both Ld. Counsels have filed written synopsis of their arguments.
Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 9 of 23 Digitally signed by SUSHEEL SUSHEEL BALA DAGAR BALA Date: 2026.04.22 DAGAR 17:37:52 +0530
Ld. Counsel for plaintiff has relied upon the following case laws: Rajiv Kumar v. Pearl Grand Galaxy cased no. 20/24 decided on 05.12.2026 of the Consumer Disputes Redressal Commission VI, Delhi, Jyothi Basu and anr. v. Kerala Water Authority and others WP (C) No. 12930 of 2021 of the Hon'ble High Court of Kerala, Satyabrata Ghose v. Mugneeram Bangur & Co., AIR 1954 SC 44 and Energy Watchdog v. Central Electricity Regulatory Commission, AIR 2017 SC (SUPP) 43, Pioneer Urban Land & Infrastructure Ltd. v. Govindan Raghavan, AIR 2019 SC 1779, Central Inland Water Transport Corporation v. Brojo Nath Ganguly, 1986 AIR 1571, Crsc Research And Design Institute ... v. Dedicated Freight Corridor decided on 30 September, 2020 of the Hon'ble High Court of Delhi, Indian Council for Enviro-Legal Action v. Union of India & Ors decided on 18th July, 2011 of the Hon'ble Supreme Court of India and Sky Land International Pvt. Ltd. v. Kavita P Lalwani decided on 25 th May, 2012 of the Hon'ble High Court of Delhi.
Arguments by Ld. Counsel for plaintiff
19. The plaintiff, in written arguments, submitted that there is an undisputed contractual relationship between the parties, as the banquet hall was booked for a wedding on 29.12.2021 and a sum of Rs. 3,61,000/- was admittedly paid by the plaintiff to the defendant, which has not been denied. It is argued that due to government-imposed COVID-19 restrictions on 28.12.2021, the contract became impossible to perform, thereby attracting the doctrine of frustration under Indian Contract Act, 1872, particularly Section 56, rendering the contract void.
20. The plaintiff further contended that once the contract became void, Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 10 of 23 Digitally signed SUSHEEL by SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:37:58 +0530 Section 65 of the same Act mandates restitution, requiring the defendant to refund the amount received, as no services were rendered in return. It is also emphasized that the defendant's own admissions regarding booking, payment, and government restrictions strongly support the plaintiff's case. The plaintiff relied upon judicial precedents such as Satyabrata Ghose v. Mugneeram Bangur & Co. (supra) and Energy Watchdog v. Central Electricity Regulatory Commission (supra) to establish that impossibility includes situations where the purpose of the contract is defeated by external events like government restrictions. The plaintiff argued that the defendant's response indicating willingness to adjust the amount in future implied acceptance of postponement, and since no future event was scheduled, the obligation to refund arises.
21. Further, the plaintiff submitted that the "non-refundable" clause cannot override statutory provisions in cases of frustration and cannot be enforced where performance became impossible due to external factors. Retention of the amount by the defendant, despite no service being provided, is claimed to amount to unjust enrichment which is impermissible in law. Such a clause is also argued to be unconscionable and against public policy under Section 23 of the Act, particularly in light of unequal bargaining power between the parties, supported by precedents like Pioneer Urban Land & Infrastructure Ltd. v. Govindan Raghavan, AIR 2019 SC 1779 and Central Inland Water Transport Corporation v. Brojo Nath Ganguly, 1986 AIR 1571.
22. The plaintiff has emphasized that the defendant's own admissions Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 11 of 23 Digitally signed by SUSHEEL SUSHEEL BALA DAGAR BALA Date:
2026.04.22 DAGAR 17:38:03 +0530 regarding booking, payment, and government restrictions conclusively establish the core facts of the case. On these grounds, the plaintiff prays for a decree directing refund of Rs. 3,61,000/- along with 24% interest and costs of the suit.
Written arguments by Ld. Counsel for defendant.
23. The defendant submitted that the plaintiff had booked the banquet hall for his daughter's wedding scheduled on 29.12.2021 for a total consideration of Rs. 4,21,000/-, out of which Rs. 3,61,000/- was paid in advance through multiple installments. On 28.12.2021, the plaintiff informed the defendant via WhatsApp that due to a lockdown, the wedding was being postponed and that a new date would be communicated later. The defendant agreed to this proposal, thereby indicating mutual consent to defer the event rather than cancel it. However, the plaintiff never provided a new date and later claimed, without proof, that the wedding had been conducted at home on the original date.
24. The defendant argued that the plaintiff's reliance on Section 56 of the Indian Contract Act is misplaced because the contract did not become impossible to perform; instead, it was postponed at the plaintiff's request, resulting in a novation of contract under Section 62. Consequently, Section 65, which deals with restitution upon a contract becoming void, is also inapplicable. The defendant further contended that the claim of unjust enrichment is baseless, as advance arrangements and expenditures were inherent in the hospitality business, and such assertions by the Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 12 of 23 Digitally signed SUSHEEL by SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:38:09 +0530 defendant's witness went unchallenged during cross-examination.
25. Further the defendant emphasized that the contract explicitly contained a non-refundable clause applicable in cases of cancellation due to "act of God or law," which the plaintiff had acknowledged and accepted without objection, both in the agreement and through admissions during cross-examination. The plaintiff and his witness also confirmed awareness of these terms, undermining the argument that the clause is unconscionable or against public policy.
26. The defendant submitted that although the existence of the contract and payments is admitted, the plaintiff is not entitled to any refund due to the binding contractual terms and his own conduct.
Court observation and findings
27. Issue no.3 is taken first as it pertains to the maintainability of the case.
Issue No. 3: Whether the suit is bad for non-joinder of the necessary party? OPD The onus to prove this issue was upon the defendant. The defendant has contended that the present suit is bad for non-joinder and mis-joinder of necessary parties on the ground that the plaintiff instituted the suit against "Majestic Crown Banquet (A Unit of Divine Hospitality)," whereas the actual entity is a partnership firm, namely M/s Divine Hospitality, which has not been properly impleaded.
28. It is necessary to examine the legal position regarding non-joinder of parties. Order 1 Rule 9 CPC provides that no suit shall be defeated by Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 13 of 23 Digitally signed by SUSHEEL SUSHEEL BALA DAGAR BALA Date:
2026.04.22 DAGAR 17:38:13 +0530 reason of mis-joinder or non-joinder of parties, and the Court may in every suit deal with the matter in controversy so far as regards the rights and interests of the parties actually before it. The only exception carved out is in respect of non-joinder of a "necessary party."
29. A "necessary party" is one in whose absence no effective decree can be passed. The test for determining whether a party is necessary has been laid down by the Hon'ble Supreme Court in Kasturi v. Iyyamperumal, (2005) 6 SCC 733, wherein it was held that a necessary party is one without whom no order can be effectively made, and a proper party is one whose presence enables the Court to completely and effectively adjudicate upon the issues involved.
30. In the present case, the plaintiff has impleaded "Majestic Crown Banquet (A Unit of Divine Hospitality)" as the defendant. The defendant itself, in its written statement and evidence, has admitted that "Majestic Crown Banquet" is a unit of M/s Divine Hospitality, and the present suit has been contested by Sh. Amit Arora, AR of M/s Divine Hospitality. The authority letter Ex. DW-1/1 placed on record further shows that the partnership firm has duly authorized its representative to appear and defend the present proceedings.
31. Thus, it is evident that the real entity, i.e., M/s Divine Hospitality, is effectively before the Court and has participated in the proceedings without any prejudice. The mere description of the defendant as a "unit" instead of the partnership firm does not result in failure of justice, particularly when the identity of the entity is not in dispute and it has fully contested the case on merits.
Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 14 of 23 Digitally signed by SUSHEEL SUSHEEL BALA DAGAR BALA Date: 2026.04.22 DAGAR 17:38:19 +0530
32. It is also pertinent to note that no objection regarding non-joinder was pressed at the stage of framing of issues in a manner requiring impleadment of any additional party, nor did the defendant take steps under Order I Rule 10 CPC for impleadment of the alleged necessary party. The objection, therefore, appears to be technical in nature.
33. The Hon'ble Supreme Court in Mumbai International Airport Pvt. Ltd. v. Regency Convention Centre and Hotels Pvt. Ltd., AIR 2010 SC 3109, held that procedural laws are intended to facilitate justice and not to defeat it, and that objections as to non-joinder should not be allowed to defeat substantive rights unless serious prejudice is demonstrated.
34. In the present case, the defendant has failed to demonstrate as to how any prejudice has been caused due to the alleged non-joinder. On the contrary, the defendant firm has itself contested the suit through its authorized representative, led evidence, and addressed arguments on merits. Therefore, it cannot now be permitted to take a hyper-technical objection to defeat the claim.
35. In view of the above discussion, the suit is not bad for non-joinder or mis-joinder of necessary parties, as the real contesting party is already before the Court and an effective and executable decree can be passed in its presence.
Accordingly, Issue No. 3 is decided against the defendant and in favour of the plaintiff.
Issue No. 1: Whether the plaintiff is entitled to a decree for recovery of Rs. 3,61,000/- alongwith pendente lite interest @ 18% p.a.? OPP
36. The onus to prove this issue was upon the plaintiff. The plaintiff Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 15 of 23 Digitally signed by SUSHEEL SUSHEEL BALA DAGAR BALA Date:
2026.04.22 DAGAR 17:38:25 +0530 has sought recovery of Rs. 3,61,000/- paid as advance for booking of the defendant's banquet hall for a marriage scheduled on 29.12.2021, which, according to him, could not be performed due to Government-imposed restrictions dated 28.12.2021 during the COVID-19 pandemic.
37. In the present case, certain foundational facts are admitted and undisputed: (i) the existence of a contractual relationship between the parties; (ii) booking of the banquet hall by the plaintiff for 29.12.2021;
(iii) payment of Rs. 3,61,000/- by the plaintiff to the defendant; and (iv) imposition of restrictions by the Government of NCT of Delhi on 28.12.2021 limiting social gatherings. Thus, the only question that arises for consideration is whether, in these circumstances, the plaintiff is entitled to refund of the amount paid.
38. The plaintiff has invoked the doctrine of frustration under Section 56 of the Indian Contract Act, 1872. The law in this regard is well settled. In Satyabrata Ghose v. Mugneeram Bangur & Co., AIR 1954 SC 44 , the Hon'ble Supreme Court held that the word "impossible" under Section 56 does not mean literal impossibility but includes impracticability and frustration of the very object of the contract. It was observed that if an unforeseen event totally upsets the foundation upon which the parties rested their bargain, the contract stands frustrated.
39. In the present case, the very purpose of the contract was to conduct a marriage function at the defendant's banquet hall on a specified date with a reasonable number of guests. The Government notification dated 28.12.2021 Ex. PW-4/A restricted gatherings to a negligible number, thereby striking at the root of the contract and rendering its performance Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 16 of 23 Digitally signed SUSHEEL by SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:38:30 +0530 fundamentally different from what was contemplated. A marriage in a banquet hall with severe restrictions defeats the commercial and social purpose of such booking. Thus, the contract became incapable of being performed in the manner intended by the parties.
40. The Hon'ble Supreme Court in Energy Watchdog v. Central Electricity Regulatory Commission, (2017) 14 SCC 80 , reiterated that a contract is frustrated when a supervening event makes performance impracticable or useless from the point of view of the object and purpose of the parties. Applying the said principle, it is found that the Government-imposed restrictions constituted a supervening event beyond the control of either party, rendering the contract frustrated.
41. The contention of the defendant that the contract was merely postponed and not frustrated is not borne out from the record. The WhatsApp message dated 28.12.2021 reflects an immediate reaction to the sudden restrictions and cannot be construed as a concluded agreement for novation under Section 62 of the Indian Contract Act. There is no evidence of any mutually agreed fresh date or a substituted contract. Mere use of the word "postponed" in an informal communication does not establish novation, particularly when no further steps were taken by the parties to reschedule the event.
42. Once it is held that the contract stood frustrated under Section 56, the consequences are governed by Section 65 of the Indian Contract Act, which mandates restitution. Section 65 provides that when a contract becomes void, any person who has received advantage under such contract is bound to restore it or make compensation. In the present case, Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 17 of 23 Digitally signed by SUSHEEL SUSHEEL BALA DAGAR BALA Date:
2026.04.22 DAGAR 17:38:35 +0530 admittedly, the defendant has received Rs. 3,61,000/- and has not rendered any service in lieu thereof. Therefore, the defendant is legally bound to refund the said amount.
43. Furthermore, the defendant has placed heavy reliance upon the "non-refundable" clause in the booking terms. However, such a clause cannot override statutory provisions. It is a settled principle that contractual terms cannot defeat the operation of law. In Central Inland Water Transport Corporation Ltd. v. Brojo Nath Ganguly, (1986) 3 SCC 156, the Hon'ble Supreme Court held that unfair and unreasonable contractual clauses, particularly those imposed in standard form contracts, are liable to be struck down as being opposed to public policy under Section 23 of the Indian Contract Act. Further, in Pioneer Urban Land & Infrastructure Ltd. v. Govindan Raghavan, (2019) 5 SCC 725, the Hon'ble Supreme Court held that one-sided contractual clauses in standard form agreements, where there is inequality of bargaining power, cannot be enforced if they operate in an unfair and unreasonable manner.
In the present case, the "non-refundable" clause, if enforced even in a situation where the contract is rendered impossible due to Government action, would result in manifest injustice and confer an unfair advantage upon the defendant.
44. All the more, the defendant has admittedly not conducted any function after the imposition of restrictions on 28.12.2021. Therefore, the defendant has not suffered any specific loss attributable to the plaintiff's booking on 29.12.2021. Retention of the entire advance amount without rendering any service would amount to unjust enrichment, which is Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 18 of 23 Digitally signed SUSHEEL by SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:38:41 +0530 impermissible in law.
45. The argument of the defendant that expenses were incurred in preparation of the event remains a bald assertion, unsupported by any documentary evidence. No bills, accounts, or records have been produced to substantiate such expenses. In the absence of proof of actual loss, forfeiture of the entire amount cannot be justified.
46. The Court is also mindful of the extraordinary circumstances prevailing during the COVID-19 pandemic. Various judicial forums have taken a consistent view that parties should not be made to suffer unjustly due to unforeseen Government restrictions. The Hon'ble Delhi High Court in many COVID matters recognized that pandemic related restrictions materially affect contractual performance and may justify refund or equitable adjustments.
47. In Halliburton Offshore Services Inc. v. Vedanta Ltd., 2020 SCC Online Del. 542, the Hon'ble Delhi High Court recognized COVID-19 as a force majeure event and held that contractual obligations may be excused where performance is impacted by pandemic related restrictions. Further, in Ramanand & Ors. v. Dr. Girish Soni, 2020 SCC Online Del. 635, the Court acknowledged the extraordinary disruption caused by COVID-19 and emphasized that Courts must adopt an equitable approach in contractual matters impacted by the pandemic. Even though the said case pertains to the tenancy, but the principle laid down is of wider application, namely that rigid enforcement of contractual terms in pandemic circumstances must yield to equity, fairness and justice. In M/s DLF Home Developers Ltd. v. Capital Green Flat Buyers Association, Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 19 of 23 Digitally signed SUSHEEL by SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:38:47 +0530 2021 SCC Online Del. 925, the Hon'ble Delhi High Court reiterated that one-sided contractual clauses cannot be enforced blindly where circumstances beyond control render performance inequitable. These decisions re-inforce that pandemic related restrictions constitutes supervening events affecting contractual obligations and require Courts to balance contractual terms with equitable considerations. The equities of the case, therefore, also lean in favour of restitution.
48. As regards the rate of interest, the plaintiff has claimed interest @ 18% per annum. However, there is no contractual stipulation on record supporting such a rate. It is a settled principle that in the absence of an agreed rate, the Court may award reasonable interest having regard to the facts and circumstances of the case.
49. Section 34 CPC empowers the Court to award pendente lite and future interest at such rate as it deems reasonable. In Central Bank of India v. Ravindra, (2002) 1 SCC 367, the Hon'ble Supreme Court held that the award of interest must be just, fair, and reasonable, and not excessive.
50. Considering the nature of the transaction, the prevailing banking rates, and the overall circumstances of the case, the Court is of the opinion that interest @ 6% per annum would meet the ends of justice.
51. In view of the aforesaid discussion, it is held that the plaintiff has successfully proved that the contract stood frustrated due to Government- imposed restrictions, and that he is entitled to restitution of the amount paid.
Accordingly, Issue No. 1 is decided in favour of the plaintiff and Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 20 of 23 Digitally signed by SUSHEEL SUSHEEL BALA DAGAR BALA Date:
2026.04.22 DAGAR 17:38:52 +0530 against the defendant.
Issue No. 2: Whether the plaintiff is also entitled to the costs of suit? OPP
52. The onus to prove this issue was upon the plaintiff. The plaintiff has sought costs of the suit along with other reliefs, contending that he was compelled to initiate the present proceedings due to the unjustified refusal of the defendant to refund the admitted amount despite repeated requests and service of legal notice.
53. Section 35 CPC provides that costs shall follow the event unless the Court, for reasons to be recorded, directs otherwise. The general rule, therefore, is that a successful party is entitled to costs, and departure from this rule must be justified by cogent reasons. The Hon'ble Supreme Court in Salem Advocate Bar Association v. Union of India, (2005) 6 SCC 344, emphasized that the object of awarding costs is to ensure that a successful litigant is not burdened with expenses incurred in litigation and that realistic costs should be granted to discourage frivolous and vexatious defences. Similarly, in Vinod Seth v. Devinder Bajaj, (2010) 8 SCC 1, it was held that costs should ordinarily follow the event and should be actual and reasonable so as to compensate the successful party. Further, in Sanjeev Kumar Jain v. Raghubir Saran Charitable Trust, (2012) 1 SCC 455, the Hon'ble Supreme Court reiterated that the provisions relating to costs are intended to achieve the twin objectives of (i) indemnifying the successful litigant for the expenses incurred, and (ii) discouraging unnecessary and avoidable litigation.
54. Applying the aforesaid principles to the present case, the Court has already held under Issue No. 1 that the plaintiff is entitled to recovery of Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 21 of 23 Digitally signed SUSHEEL by SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:38:58 +0530 the amount paid, as the contract stood frustrated and the defendant was bound to refund the same. Despite this, the defendant failed to refund the amount even after service of legal notice dated 10.03.2022 and instead compelled the plaintiff to approach the Court. The conduct of the defendant in withholding the admitted amount, without rendering any service, and in forcing the plaintiff to engage in prolonged litigation, cannot be said to be justified. The defence taken by the defendant, though legally argued, has not been found sustainable in the facts and circumstances of the case.
55. The plaintiff has incurred expenses towards Court fees, legal notice, and professional charges for prosecuting the present suit. In the absence of any material to show that the plaintiff acted in a vexatious or mala fide manner, there is no reason to deprive him of the costs of litigation. The Court finds no special circumstances warranting departure from the settled rule that costs should follow the event. On the contrary, the facts of the present case justify awarding of costs in favour of the plaintiff so as to compensate him for the expenses incurred and to meet the ends of justice.
Accordingly, Issue No. 2 is decided in favour of the plaintiff and against the defendant, and the plaintiff is held entitled to costs of the suit. Issue No. 4: Relief
56. In the present case, the defendant has admittedly received a sum of Rs. 3,61,000/- from the plaintiff and has not rendered any corresponding service. In view of the findings already recorded on Issue No.1, Issue No.2 and Issue No.3, retention of the said amount by the defendant is not Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 22 of 23 Digitally signed SUSHEEL by SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:39:02 +0530 legally sustainable, and the plaintiff is entitled to recover the same with interest. The plaintiff is also entitled to costs of the suit under Issue No. 2 in terms of Section 35 CPC.
57. Accordingly, the suit of the plaintiff is decreed in the following terms:
(i) A decree for recovery of Rs. 3,61,000/- (Rupees Three Lakhs Sixty-
One Thousand only) is passed in favour of the plaintiff and against the defendant;
(ii) The plaintiff shall be entitled to pendente lite and future interest @ 6% per annum on the decreetal amount from the date of filing of the suit till realization;
(iii) The plaintiff shall also be entitled to costs of the suit.
Decree sheet be prepared accordingly. File be consigned to Record Room after due compliance. SUSHEEL by Digitally signed SUSHEEL BALA DAGAR BALA Date:
DAGAR 2026.04.22 17:39:08 +0530 Announced in open Court (Susheel Bala Dagar) on 22nd Day of April 2026 District Judge-08, West Tis Hazari Courts, Delhi.
(This judgment contains 23 pages.) Civ DJ 253/20 Dev Polyplast (P) Ltd. v. Narain Dass Sindhi Page no. 23 of 23