The main legal point established is that non-disclosure of material facts and misconduct by a party can justify the award of compensation and refund of advance amounts in specific performance cases.

MANMOHAN SINGH, J.

1. The petitioner has filed objections under Section 34 of Arbitration and Conciliation Act, 1996 (hereinafter referred to as the “Act”) challenging the award dated 7th November, 2014 passed by the Arbitrator Justice (Retd.) Mukul Mudgal.

2. On 20th February, 2015 the notice was issued only to the extent that the compensation could not have been awarded to the respondents in the absence of claim of compensation in terms of the provision of Section 21(5) of the Specific Relief Act. The compensation was awarded to the tune of Rs.25 lacs.

3. The compensation was awarded by the learned Arbitrator due to the following reasons:

(i) Non-disclosure of acquisition proceedings.

(ii) Non obtaining of NOC.

(iii) Non disclosure of subsequent agreement to sell and money received by the respondent.

(iv) No right to forfeit the advance amount.

4. Counsel for the respondents has fairly submitted that the facts and circumstances are so clear wherein the relief would be fair and correct in view of findings of the learned Arbitrator and cogent reason thereunder. The same is not contrary to the provision of Section 21 (5) of the Specific Relief Act as alleged by the petitioner because of peculiar facts of the present case as the petitioner has played a fraud upon the respondent at the time of execution of agreement and receiving the part consideration.

5. Admittedly, in the Agreement to Sell dated 10th December, 2009 it is stipulated categorically that the land in question which was agreed to be sold for Rs.12,99,00,000/- was free from all encumbrances, injunction, litigation, etc. Part payment was paid to the petitioner. The balance amount of Rs.11,49,00,000/- was payable on or before 15th April, 2010. It was stated in the agreement that the said amount was to be paid at the time of handing over of the possession, execution of Sale Deed in favour of the respondents or their nominee.

6. After execution of agreement, it had come to the knowledge of respondents that the said land in question was under land acquisition proceedings and notices under Sections 4 and 6 of the Land Acquisition Act, 1894 had been issued long before, i.e. in the year 1995/1997. There was also an award passed which was being challenged in a writ petition filed by the petitioner that got finally disposed of on 4th May, 2012. But once again notices were issued by Government of NCT of Delhi and a writ petition was filed in November, 2012 challenging the said public notice.

7. The entire record was placed on record by the respondents before the Arbitral Tribunal when said situation was pointed out and confronted in the cross examination, Mr. Rajinder Kiri admitted that there is no such averment in the agreement and pretended/non-recollection of the fact, whether the same was brought to the notice to the respondents or not. In the Award, the Arbitral Tribunal observed that the seller enticed the respondents to enter the contract on fake pretences and concealed the acquisition proceedings.

8. It is apparent in view of finding that the petitioner did not disclose material facts. It was the case of the respondents before the Arbitral Tribunal that they had been approaching the petitioner between 2010-13 for execution of the Sale Deed which was being deferred by the petitioner, on the ground that the Sale Deed in that area were not being registered by the office of Sub-Registrar. The deponent/respondents in his testimony has deposed that the respondents have not received any notice in writing from the petitioner ever for terminating or cancelling the Agreement to Sale. In cross examination of Sh.Tejinder Setia he stated that he did not deposit the balance amount as per Agreement to Sell as NOC was not forthcoming despite approaching Mr. Kiri many times for accepting the money.

9. The respondents had filed the notification of Divisional Commissioner, Delhi, Registrar Branch before the Arbitral Tribunal which requires that in case of agricultural land the NOC in the nam