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2008(7) Supreme 214
SUPREME COURT OF INDIA
S.B. Sinha and Dr. Mukundakam Sharma, JJ.
DLF Universal Ltd. — Appellant
versus
Ekta Seth & Anr. — Respondents
Civil Appeal No. of 2008
(Arising out of S.L.P. (Civil) No. 18834 of 2006)
Decided on : 15-07-08
Facts of the Case :
1. Respondent herein in the instant case booked a flat along with parking space in the appellant’s DLF Regency Park, Gurgaon. Respondent, paid all installments due upto five years. But thereafter he could not make any payment of installment. On Cancellation of allotment of flat and forfeiture of earnest money by appellant, application was filed by respondent under Section 12-B for payment of compensation on ground of unfair trade practice. Said application was allowed by MRTP Commission.
2. Present appeal has been filed against said order of MRTP Commission.
Findings of the Court :
Instantly installments were duly paid for at least five years and payment was stopped thereafter on ground that increase in cost of flat was beyond means of respondent and also fact that appellant had failed to deliver the possession of the flat in time.On the other hand there were bona fide reasons on part of appellant for their inability to handover the said possession within the stipulated time and the increase in cost was on account of factors specifically enumerated in clause 2(b) and clause 4. Considering the entire facts and circumstances of the case, held that interest of justice would be subserved if, in exercise of discretionary jurisdiction under Article 142 of Constitution, direction was given for refund of 50% of amount which was forfeited by the appellant. Appeal was disposed of with said directions.
Result : Appeal disposed of.
JUDGMENT
Dr. Mukundakam Sharma, J. —
1. Leave granted.
2. This appeal is filed by the appellant challenging the legality of the judgment and order dated 3rd July, 2006 passed by the Monopolies and Restrictive Trade Practices Commission, New Delhi (for short “the Commission”). By the aforesaid judgment and order the learned Commission made certain observations and recorded findings against the appellant herein, which are under challenge in this appeal. The Commission recorded a finding that the action of the appellant in increasing the cost which forced the respondent from making further payments resulting in the cancellation referred to by the appellant was unfair trade practice and the appellant had no right to forfeit the earnest money. Consequently a direction was issued that the appellant should return the earnest money with interest thereon @ 9% per annum from the date of withholding the earnest money till the date of repayment in respect of the main flat as well as the parking space in respect of the letters dated 26th/27th May, 1999.
3. We may briefly state the facts leading to the aforesaid direction of the Commission. The respondent herein booked a flat along with parking space in the appellant’s DLF Regency Park, Gurgaon by entering into an Apartment Buyer’s Agreement on 17th June, 1993. The sale price fixed by both the parties was at Rs.16,37,448/- payable in 42 installments spread over a period of ten years commencing from 9th March, ending on 9th March, 2003. The respondent, herein admittedly paid all the installments due upto September 1998 which came to a sum of Rs.9,94,836/-. But thereafter he did not make any payment of installment and therefor was considered to be a defaulter by the appellant. In the meantime by letter date 19th February, 1998 the appellant demanded an additional amount of Rs. 4,21, 474.06 from respondent on account of cost of escalation, increase in area, external electrification, fire fighting system and stand-by generators. The said amount was to be paid in four equal bi-monthly installment of Rs.1,05,368.52/- commencing from 15th March, 1998. The respondent did not honor the said demand. Consequently, the appellant cancelled the allotment of the flat vide its letter dated 26th May, 1999 and forfeited the earnest money and returned the balance amount due.
4. The respondent sent a legal notice dated 23rd May, 2001 to the appellant contending that the cancellation of the allotment of the flat was illegal and arbitrary. The appellant sent a reply to the legal notice on 25th June, 2001 stating that the deductions made were lawful and in accordance with the terms of the agreement.
5. The respondent, however, was not satisfied with the reply sent by the appellant and instead filed an application under Section 12-B of the Monopolies and Restrictive Trade Practices Act, 1969 before the Commission for payment of compensation on the ground of unfair trade practice. It was contended inter alia, by the respondent that the appellant was not entitled to forfeit the earnest money as they themselves were unable to give delivery of the flat within the stipulated time and more particularly, when the appellant has re-sold the said flat at a good price, therefore, as the appellant did not incur any loss, they could not and were not, entitled to forfeit the earnest money. The aforesaid submission of the respondent found favour with the Commission and it recorded the aforesaid finding and allowed the application filed by the respondent, consequent to which the impugned directions were issued which are under challenge in this appeal.
6. The issue which was raised and urged before us, therefore, clearly revolves around the power and jurisdiction of the appellant in forfeiting the earnest money which was to the tune of Rs.1,80,470/-. On going through the record we, however, found that out Rs.1,80,470/- an amount of Rs.1,69,012/- was forfeited as earnest money, out of which an amount of Rs. 1,62,412/- was for the
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