Delhi District Court
Shri Sanjeev Narula vs Perfect Wellness Private Ltd on 24 November, 2014
In the court of Ms. Ina Malhotra, District & Sessions Judge
South East : Saket Courts, New Delhi
RCA No. 18/14
(ID No. 02406C0057032014)
Shri Sanjeev Narula
S/o Sh. ML Narula
Having his office at
D95, Okhla Industrial Area, PhaseI
New Delhi .... Appellant.
V E R S U S
Perfect Wellness Private Ltd
Plot No.7, Sector27A
Main Mathura Roads
Faridabad121003 .... Respondent.
Appeal presented on : 07.03.2014
Arguments concluded on : 24.11.2014
Judgment on : 24.11.2014
J U D G E M E N T
This appeal is against the order of the Ld. Trial Court whereby the respondent's suit has been decreed against the appellant for recovery of money.
2. The appellant is the owner of property bearing no.W57, Greater KailashI, New Delhi. The respondent who was RCA No.18/14 Sanjeev Narula Vs M/s Perfect Wellness Page.....1 of 6 in search of a commercial premises to open a dental clinic evinced an interest in taking the first floor of the appellant's premises on rent, and a letter of intent was executed on 30.03.2012 on the assurance that the premises was suitable for commercial purposes. The respondent issued a cheque in the sum of Rs.1.25 Lacs as token money. It was mutually agreed that the lease would be executed after the respondent was satisfied about the title/ownership of the appellant's property. A draft lease deed was prepared and sent by the respondent. However, as per one of the clauses, it was mentioned that in case the permission for commercial use was not granted, then the lease would stand cancelled and respondent would vacate the premises and be entitled to refund of the deposit. This condition was not acceptable to the appellant and therefore the proposed lease deed was never executed.
3. The appellant informed the respondent that failure to execute the lease and take possession would entitle him to forfeit the token amount as he had turned away other prospective tenants. The respondent filed the suit for recovery of the token amount of Rs.1.25 lakhs as the premises was not conducive for opening a health club and no commercial activity was permitted which was RCA No.18/14 Sanjeev Narula Vs M/s Perfect Wellness Page.....2 of 6 contrary to the assurance given by the appellant. The Ld. Civil Judge framed the issue with respect to the respondent/plaintiff's entitlement for return of the amount of Rs.1.25 Lacs and decided the same in their favour.
4. I have gone through the record of the trial court and appraised the impugned order. As per averments, the respondent M/s Perfect Wellness Pvt. Ltd. is a reputed Super Specialty Health Care Institute that provides medical services in eye care, dental care, optical care, physiotherapy and weight loss.
5. There is no dispute with respect to the advance payment of Rs.1.25 lacs or the fact that the lease deed was not executed. The respondent/plaintiff had submitted that the said premises was being considered to be taken on lease upon the appellant's representation that the same could be used for commercial purpose for opening a dental or a health clinic. Keeping in view that the possession was never handed to the plaintiff, the Ld. Trial Court held that the defendant/appellant herein was liable to repay the same, moreso as there was no agreement in respect of forfeiture of the amount or compensation / damages as envisaged under Sections 7374 of the Indian Contract Act. The appellant/defendant had also failed to RCA No.18/14 Sanjeev Narula Vs M/s Perfect Wellness Page.....3 of 6 prove any loss nor could he substantiate that he spent Rs.32,000/ on the buying of stamp papers. In view of the same, Ld. Trial Court came to the conclusion that as the contract was never concluded and neither was the possession transferred from one party to another, the defendant/appellant was liable to refund the same.
6. There is no gainsaying that damages have to be proved, but this court is of the view that in commercial transactions like the present one, even the token money has to be given after due satisfaction about the suitability of the premises by the party proposing to take it. It is not a practice that money can be given and claimed back at will alleging non suitability of the property or even wanting to retract if the proposed tenant finds a more suitable or viable option. There is a certain amount of commitment from both sides, and time and effort are spent only because a certain amount of genuineness is evinced through payment of the token amount. A landlord stops entertaining prospective takers or queries on the basis of this commitment after accepting money from any party. The same cannot be entirely refunded at the mere asking of the respondent/plaintiff. The appellant has stated that the respondent's requirement was RCA No.18/14 Sanjeev Narula Vs M/s Perfect Wellness Page.....4 of 6 for a dental clinic which was a permitted use under the Master Plan. The suitability of the use of the premises had to be ascertained by the prospective taker as well. As per the letter of Intent, the token money was given on submission of documents to the respondent. Further, the draft Lease Deed as submitted by the respondent reflects that all certificates for use of the premises was to be undertaken by the respondent. Therefore, to claim the entire refund would be arbitrary and inequitable. Keeping these facts in mind, this court sets aside the judgment and decree of the trial court and decrees only 50% refund in favour of the respondent/plaintiff.
7. Appeal allowed in terms of the above. The suit of the respondent/plaintiff is decreed only for recovery of 50% of the amount paid i.e. for Rs. 62,500/ together with costs and interest, pendentelite and future @ 12% per annum. Decree sheet be prepared.
8. File be consigned to Record Room.
Announced.
(Ina Malhotra) District & Sessions Judge South East, Saket Courts New Delhi 24.11.2014 RCA No.18/14 Sanjeev Narula Vs M/s Perfect Wellness Page.....5 of 6 RCA No18/14 Present: Counsel for the parties.
Vide separate judgment, the appeal stands allowed in terms thereof.
Decree sheet be prepared. Copy of order alongwith TCR be sent to the Ld. Trial Court.
File be consigned to record room.
(Ina Malhotra) District & Sessions Judge South East, Saket Courts New Delhi 24.11.2014 RCA No.18/14 Sanjeev Narula Vs M/s Perfect Wellness Page.....6 of 6