The main legal point established in the judgment is the acknowledgment of liability and its implications under the Limitation Act, 1963, and the legal principles related to the obligation to refund advance payments in the context of real estate development.

2.1. The respondent company is engaged in business of the real estate development. The petitioner had applied to the respondent company on 15.02.2007 for booking of a residential unit in its project “Eastern Homes” proposed to be developed by the respondent at Dasna, Ghaziabad (U.P.) on National Highway - 24. The petitioner had also paid a sum of `1,48,500/- along with the printed application form and the same was duly accepted by the respondent company. The application form also contained the terms and conditions on which the bookings were accepted by the respondent. Clause “(b)” of the terms and conditions provided that in the event the developer was not in a position to offer the allotment of the unit within a period of 12 months, the Developer would refund the advance along with simple interest at the rate of 9% per annum. The said clause (b) is relevant and is quoted below:-

“In case the Developer is not in a position to make offer of allotment for the Flats/Shops/Plots/Independent Floor/Villas/ Mall Stores within a period of 12 months from the date of my/our application for any reason whatsoever, we shall only be entitled to refund of the Advance for Provisional Registration paid by us along with simple interest @ 9 % p.a. from the date of payment of such advance, subject to my/our giving you a 30 days notice of the same.”

2.2. The petitioner states that subsequent to the registration, the petitioner had also made a payment of further sum of `1,48,500/-. Thus, in aggregate the petitioner had paid a sum of `2,97,000/- to the respondent company. The aforementioned project could not take off and consequently the petitioner sought refund of the amount paid to the respondent. Pursuant to the request made by the petitioner, the respondent sent a letter dated 22.10.2008 forwarding an Application Form for Refund to the petitioner. The respondent called upon the petitioner to sign the said application form in order that the refund could be processed. The petitioner signed the said application form as required by the respondent and forwarded the same to the respondent. In spite of receiving the request for refund in the form as specified by the respondent, the respondent failed and neglected to make the payment.

2.3. Thereafter, the petitioner sent several reminders to the respondent, however, most of them were not replied to. Finally, the petitioner was constrained to cause a legal notice to be issued to the respondent on 04.06.2009 calling upon the respondent to pay a sum of `2,97,000/-along with interest. The petitioner further cautioned that in case of failure to pay the aforesaid amount, the petitioner would be constrained to initiate legal proceedings. Subsequent to the said legal notice, the respondent forwarded a cheque for a sum of `50,000/-under the cover of its letter dated 04.08.2009. The letter further stated that the cash flows of the respondent companies were severally affected, however, the respondent had no intention not to make the payment due to the petitioner. The respondent further assured that the balance amount would also be released as early as possible.

2.4. Despite the assurance held out by the respondent, further payments were not forthcoming and the petitioner continued to pursue with the respondent for release of the balance payment. Thereafter, the petitioner caused another notice dated 01.12.2009 to be served on the respondent calling upon the respondent to pay the balance sum of `2,47,000/-. In response to this notice, the respondent caused a letter dated 12.12.2009 to be sent through its advocate, whereby the respondent contended that there was a mutual settlement under which the petitioner had agreed to accept the sum of `50,000/-. It was asserted that with the said amount being paid by the respondent, the respondent had duly performed its obligations. This notice was immediately replied to by the petitioner, by a letter dated 18.12.2009, and the statement of the respondent that there h