PARADISE DEVELOPERS PVT. LTD. vs RAMESH C. DUTTA

THE impugned order is an ex parte order. Vide impugned order dated 4.1.2002 the appellant has been directed to refund Rs. 63,000 received by it from the respondent towards the allotment of plot measuring 100 sq. mtrs. with interest @ 20% from 1993 to the date of payment of amount and also to pay Rs. 10,000 as compensation for mental agony suffered by the respondent and Rs. 3,000, towards the cost. It was also directed that the said payment will be paid within 45 days from the date of issue of this order and in default additional interest @ 18% shall be payable by the appellant. Feeling aggrieved the appellant has preferred this appeal.

THE allegations of the respondent giving rise to the aforesaid orders, in brief, are that he applied for allotment of plot measuring 100 sq. mtrs. in the Paradise City Plan in Greater Noida plotted by appellant i.e., M/s. Paradise Developers Private Ltd. THE respondent deposited Rs. 25,000 on 25.9.1990 and after the appellant promised to develop the colony in its final shape within a period of 2 years he by January, 1993 paid the entire amount of Rs. 63,000. In spite of repeated reminders and even after paying for internal development charges he did not receive any response from the appellant. When the respondent made a complaint in the Connaught Place Police Station against the appellant, he assured to register the plot by May 1999. However, on 28.6.1999 they wrote to the respondent asking it to bring the matter before an Arbitrator. In spite of notice the appellant did not turn up. Hence he was proceeded ex parte. The perusal of the order shows that the District Forum relied upon the agreement between the parties wherein it was stated that for any delay after January 1993, the appellant will be liable to pay a penalty and interest of 20% p.a. on the actual amount received by the respondent and on the basis of documents showing the payment of Rs. 63,000 the District Forum passed the impugned order.

The impugned order has been assailed mainly on the premise of Clause 7 of the agreement between the parties. According to this clause the appellant made it clear to the respondent at the time of sale of plot in question that in case of any acquisition or requisition the same shall be at the cost or at the risk of the seller if it is before the execution of the sale deed in favour of the purchaser or subject to the decision of the Hon'ble High Court of Allahabd, Luknow Bench or any other Court. But after the execution of sale deed it will be at the risk or cost of the purchaser. In respect of this the purchaser shall be still bound to carry out and implement all the terms of this agreement, including as to payment of the instalments as and when they fall due and shall not be entitled to claim the refund of the amount paid by him.

IT also provided that the purchaser shall be entitled to claim and receive from the seller along with the other purchaser the compensation on pro rata basis to the extent of its actual payment credited with the seller at the time and in such manner as and when the same is finally determined and received by the seller. Also if the purchaser at the relevant time has not made payment of any instalment as stipulated in the agreement whether demanded by the seller or not, then the instalment thus outstanding and not paid shall be adjusted from the amount of the compensation payable to him. The purchaser shall have no other right or claim against the seller. In the said clause the appellant also stated that of present there was no decision of any other Government or local authority or the High Court regarding acquisition of request on or otherwise taking over of the land of the seller in which the plot is located. From the aforesaid clause the respodent was made amply aware of the fact that in case of any acquisition or requisition the same shall be at the cost and at the risk of the seller if it is before the execution of the sale deed in favour of the purchaser and/or subject to the decision of the High Court of Allahabad and after the execution of sale deed, it shall be at the risk or cost of the purchaser.

ADMITTEDLY in the instant case no sale deed was executed because of non-payment of the instalments by the respondent which was in breach of Clause 7. Besides this, the respondent also as per Clause 13 of the agreement was liable to pay such charges as may be determined by the seller for maintaining various service/facilities in the colony until the same are handed over to the Government or local authority for maintenance. Clause 6 that was invoked by the District Forum reads as under: "The purchaser and the seller hereby agree that the amounts paid by the former to the latter either with the application for registration/allotment or thereafter in the extent of 20% of the total sale price of the plot shall constitute earnest money for the purpose of this agreement."

Clause 6 provided that in case the particular plot is not handed over by the seller to the purchaser for any reason or otherwise, it is mentioned in subsequent clauses that the seller shall arrange alternative plot or will be liable to refund the actual amount received from the purchaser with annual interest @ 20%.

IN our view the respondent was entitled to interest @ 20% if the sale deed had been executed in his favour prior to the acquisition or requisition of the land. For this act of omission and commission and the breach of Clause 7, the respondent was not entitled to the interest nor was appellant in terms of the agreement liable to pay @ 20%. Respondent purchased the plot with open eyes and being aware of the fact that in case of any acquisition or requisition of the land where the plot is situated the same shall be at the cost or at the risk of the seller if it is before the execution of sale deed in his favour and/or subject to the decision of the High Court of Allahabad and after the execution of the sale deed it will be at the risk or at the cost of purchaser.

THE cumulative effect of the aforesaid clauses leads to the conclusion that the appellant was not liable to pay interest @ 20% p.a. because neither was the sale deed executed before the acquisition or requisition proceedings nor had the respondent made all the due instalments entitling him to the sale deed. It appears that the respondent entered into the agreement mainly because of speculation as to the rising cost of the plot. The Counsel for the appellant has referred to certain proceedings pending in the High Court, Allahabad for more than decade or so.

Taking overall view of the matter and strictly in terms of the agreement between the parties we partly allow the appeal by maintaining the direction of refund of Rs. 63,000 and compensation and cost and set aside the awarding of the interest as interest was not permissible under the terms of agreement between the parties.

HOWEVER, the FDR deposited by the respondent can be encashed by the respondent and the amount shall stand adjusted to the amount awarded by this order. The bank guarantee/FDR, if any deposited by the appellant be returned forthwith after completing necessary formalities.

A copy of this order as per statutory requirements be forwarded to the parties free of costs and also the concerned District Forum and, therafter, the file be consigned to Record Room. Appeal partly allowed.