Extension of completion period and waiver of penal interest altered the original terms of the contract, making time no longer the essence of the payment.

JUDGMENT

Aniruddha Roy, J. - Facts:-

1. The second respondent, The West Bengal Board) since about 2004 was engaged in Housing Board (for short, the Housing the process of construction of a Mega Housing Complex at New Town, Rajarhat under the name and style 'Eastern High' (for short, the Housing Project) comprising of about 440 nos. of residential units/flats. Under the scheme of allotment, the flats were to be allotted on the basis of lottery only. The possession of the flats were scheduled initially to be delivered in December, 2008.

2. The writ petitioner came to know that there were several flats which remained either unallotted or the allotments were cancelled and were to be offered for purchase amongst the public at large on the basis of lottery on certain revised terms and conditions and at an increased consideration than the original terms.

3. On the basis of the said information the writ petitioner obtained the necessary brochure from the Housing Board and applied to obtain one such residential flat in his name. The petitioner duly deposited the application money for a sum of Rs. 2 lakhs on December 13, 2007, such deposit was duly received and acknowledged by the Housing Board.

4. After compliance of all the procedures and formalities a provisional allotment letter dated April 23, 2008 was issued by the Housing Board in favour of the petitioner. The total consideration for the said allotted flat to the petitioner was Rs. 48,81,700/-. After giving credit to the said application money of Rs. 2 lakhs paid by the petitioner, the petitioner was required to pay a further sum of Rs. 46,81,700/- within 60 days from the date of issue of the said letter of allotment in the manner and mode specified therein. In the said letter of allotment it was stipulated that a penal interest at the rate of 18 per cent per annum would be levied in case there is any delay in payment of any amount in stage payment during the construction period. It was also stipulated that in case there would be any delay in depositing the amount with penal interest after 120 days from schedule date of payment, then the allotment will stand automatically cancelled without any further reference to the petitioner and the amount already deposited would be refunded in due course as per the General Terms & Conditions. The allotted flat (for short, the said flat) was earmarked as Flat No. T9/F14/C/4 and the car parking space (for short, the said car parking space) was earmarked as Space No. T9/C/4 at the said Housing Project.

5. By a letter dated July 24, 2008 the housing board informed the petitioner that there would be a delay in completion of the said housing project due to certain unforeseen circumstance as mentioned in detail in the said letter. It was also informed that there would be a deferment of completing the project by 12 months from the schedule time.

It was specifically mentioned in the said communication that the project work was expected to be completed at the end of December, 2009 instead of December, 2008 as indicated in the Scheme Brochure, which was the original date for completion. The housing board had also mentioned in the letter that since the above delay and the causes and reasons thereof were completely unforeseen and beyond the control of the board, the target period of completion of the project was, therefore, to be shifted to end of December, 2009 in place of December, 2008 and the provision for providing the compensation by way of making payment of interest as specified in the scheme brochure for such delay was accordingly not made applicable at the given situation due to the unforeseen circumstance. The said communication also mentioned the allottees whose payments fall due then onwards should have a grace period of one year to pay the same without any interest. Those who had paid the penal interest on instalment due on February, 2008, would be eligible to get the same back by way of refund/adjustment during final payment.

6. By a letter dated O