Equitable treatment of all flat purchasers and the necessity of contributions for project completion.

1. Heard.

2. These two applications are complete abuse of the process of this Court. They are not only thoroughly misconceived, as we shall see, but, in my view, are mischievous in their conceptualization and devious in the manner in which they are laid. I will come to the details presently, but the long and short of the case in each is this: a series of orders facilitated the completion of construction of a halted and nearly abandoned construction project in Bengaluru. There were very many stakeholders, including different flat purchasers and the land owners. The numbers of flat purchasers ran into the hundreds. In an effort to ensure that the project was completed, a scheme was evolved. The developer had thrown up his hands. A provisional liquidator had been earlier appointed of the developer company. The land owners and the flat purchasers came together and appointed a contractor and a project management consultant. The land owner contributed money. An assessment was done by which it was estimated that project completion would cost an additional Rs. 250/- per sq ft. Arrangements were made for contribution. For those who did not contribute, the land owner agreed to make payment and recover. Some purchasers bought flat from the developers’ quota; others bought from the land owner’s quota. Notices were issued to all purchasers. One could not be served. These two applicants, though given notice, stayed away and they did so, as we shall see, on thoroughly specious grounds. These two applicants have bought flats from the land owner’s quota. They say they are not bound to pay these additional costs of construction. They say their agreement is with the land owner. It matters not to them what it costs her to complete the construction; they stand apart. They are unlike any other flat purchasers. They must receive a special treatment. They must be exempted from what every one else pays. It is of no moment that none of the previous orders have been challenged by anyone, and that, but for those orders, the project would not have progressed.

3. The project is in Bengaluru. It is one of two construction and development projects. Both were to be undertaken by Mantri Realty Limited (“Mantri”). That company is now in provisional liquidation. One project was called Mantri Royale. We are not concerned with that one. The other project was called Mantri Premero. The project envisaged the construction of 253 flats over four towers or wings labelled “A”, “B”, “C” and “D”. The land owner was the Lakkanna family, represented by Ms Shanta Lakkanna. Her agreement with Mantri was that Mantri could sell 65% of the flats and retain the sale proceeds. She would be entitled to retain 35% of the flats. Obviously, this meant that Mantri was not paying her and she was not paying Mantri, but the consideration that passed between them was, first, in the contribution of the land and, second, in the division inter se of these flat quotas. Importantly, Mantri acquired no title to the land at any stage.

4. These quotas translated into 167 flats in the Mantri share and 86 flats in Mrs. Lakkanna’s share. Mrs. Lakkanna sold 46 of the 86 flats from her share. The Applicants in these two Company Applications are two of those purchasers from Mrs. Lakkana. The other 40 flats she has retained. The flat purchasers’ expectations, and perhaps even dreams, turned sour when Mantri was taken to provisional liquidation. The directors of Mantri threw up their hands. They abandoned the project. All work stopped. In fact, the site was all but abandoned. It was soon a ruin, the site overrun with weeds and wild plants. The flat purchasers had no real prospect of completion of the project or of delivery of their flats. The land owner had capital, both in terms of money and land, locked up and very possibly jeopardised.

5. While Mantri and its directors were fighting their battles in this Court and elsewhere, this was the situation on the ground so far as the flat purchasers and t