Prashant Kumar Mishra, J.

1. Heard on I. A.No. 01/2017, application for condonation of delay.

2. On due consideration, I.A. No. 01 of 2017 is allowed. Delay of 5 days in filing the instant appeal is hereby condoned.

3. With the consent of the learned counsel for the parties, the matter is heard finally at the motion stage.

4. The present appeal arises out of the judgment and decree dated 23.02.2017 passed by the 8th Additional District Judge, Durg, in Civil Suit No. 25-B/2014, wherein the trial Court has dismissed the plaintiff/appellant's suit for refund of the advance amount.

5. Appellant Sunil Jain is the prospective purchaser of land from respondent Pitambar Sahu, Dhaneshram Sahu and Vishal Ram Sahu. The agreement for sale was executed between the parties on 08.10.2011 advance amount of Rs. 1,25,000/- was paid to the respondent/defendant.

6. According to the plaintiff, he had agreed to purchase the property for developing and selling plots. However, subsequent to the agreement, it came to his notice that the land is reserved in the master plan for green belt. Therefore, the same being not useful for him, he was no longer willing to purchase the land and requested the defendant to return the advance amount which was refused by the defendant stating that he is ready to sell the property.

7. In a suit for return of advance amount or the earnest money, it is not to be adjudicated as to which party committed default in part performance unless the agreement contains a forfeiture clause. The Supreme Court in the matter of Satish Batra v. Sudhir Rawal (2013) 1 SCC 345 has held that precision and clarity in clauses of contract to justify forfeiture is necessary and that in agreement for purchase of immovable property the forfeiture clause will not apply when the payment is made only towards part payment of consideration and not intended as earnest money.

8. The trial Court has held in clear terms in para-22 of the impugned judgment that there is no stipulation in the contract that in the event of breach of contract by the prospective purchasers the advance amount shall stand forfeited. We have also seen the agreement Ex.P-1, containing only six clauses, duly signed by both the parties, executed on 08.10.2011 without containing any clause for forfeiture of the advance amount. Clause-2 of the agreement, referred to the amount paid to the prospective vendor as "Bayana" i.e. the advance amount which is to be adjusted towards sale consideration at the time of registration of sale deed. Thus, the parties never intended that the amount so paid to the prospective vendor at the time of execution of agreement shall be the earnest money and not advance money and it is precisely for this reason there is no forfeiture clause in the agreement.

9. Difference between 'advance amount' and the 'earnest money' has been considered by the Supreme Court in number of cases. In Shree Hanuman Cotton Mills v. Tata AirCraft Ltd (1969) 3 SCC 522, the Supreme Court laid down certain principles to determine as to when the amount paid as 'advance' be treated as 'earnest money' and the seller is entitled to forfeit the same. Para 21 of the judgment is reproduced hereunder.

"21. From a review of the decisions cited above, the following principles emerge regarding 'earnest':

(1) It must be given at the moment at which the contract is concluded.

(2) It represents a guarantee that the contract will be fulfilled or, in other words, 'earnest' is given to bind the contract.

(3) It is part of the purchase price when the transetion is carried out.

(4) It is forfeited when the transaction falls through by reason of the default or failure of the purchaser.

(5) Unless there is anything to the contrary in the terms of the contract, on default committed by the buyer, the seller is entitled to forfeit the earnest.

10. In the matter of DDA v. Grihsthapana Coop. Group Housing Society Ltd 1995 Supplementary (1) SCC 751, the Supreme Court, following privy council's decision in the matter of