2018 Supreme(Del) 2744
IN THE HIGH COURT OF DELHI AT NEW DELHI
VALMIKI J.MEHTA, J.
SHASHI - Appellant
Versus
NAVEEN SANGHAVI - Respondent
RFA No. 215 OF 2016 & CM Nos. 12889 of 2016 (stay) 31503 of 2018 (for withdrawal of amount)
Decided on : 07-09-2018
For the Appellant :Mr. C.S.Maan, Mr. Gaurav Gogna and Mr. Kulwinder Singh, Advocates
For the Respondent:Mr. Kartickay Mathur, Advocate
VALMIKI J. MEHTA, J
1. This Regular First Appeal under Section 96 of the Code of Civil Procedure, 1908 (CPC) is filed by the defendant in the suit impugning the judgment of the Trial Court whereby the Trial Court has decreed the suit for recovery of Rs. 2,10,000/- alongwith interest, and this amount is held in as liable to be paid/refunded because it was the appellant/defendant who had failed to perform her part of the contract/Agreement to Sell and thus because of committing breach, the amount received of Rs. 2,10,000/- under the subject agreement to sell cannot be forfeited.
2. I need not narrate the facts in detail because entering into the Agreement to Sell between the parties dated 7.5.2011, Ex.PW1/2 is not disputed. That the appellant received a sum of Rs.2,10,000/- under the Agreement to Sell dated 17.5.2011 is also not disputed by the appellant/defendant. In my opinion, there is no need to go into the aspect as to whether or not the respondent/plaintiff was guilty of breach of contract, or instead whether the appellant/defendant was or was not guilty of breach of contract, because the law is that even if a buyer such as the respondent/plaintiff is guilty of breach of contract, a seller such as the appellant/defendant, cannot forfeit the amount paid under an Agreement to Sell unless the seller pleads and proves any loss caused to him on account of breach of contract by the buyer/respondent/plaintiff. In this case there is no pleading and proof especially of a specific/particular amount, that the appellant/defendant suffered any loss on account of the stated breach by the respondent/ plaintiff/buyer under the agreement to sell.
3. It is held by the Constitution Bench of the Supreme Court in the case of Fateh Chand Vs. Balkishan Dass AIR 1963 SC 1405, and which judgment has been recently followed by me in the judgment in the case of M.C. Luthra Vs. Ashok Kumar Khanna 2018 (248) DLT 161 that a seller cannot forfeit amounts paid under an agreement to sell unless causing of loss to him is duly established. In M.C. Luthra’s case (supra) I have distinguished the judgment of the Supreme Court in the case of Satish Batra Vs. Sudhir Rawal, (2013) 1 SCC 345 by placing reliance upon a later judgment of the Supreme Court in Kailash Nath Associates Vs. Delhi Development Authority and Another (2015) 4 SCC 136, and that a seller under an Agreement to Sell cannot forfeit the amount paid under the Agreement to Sell unless loss is pleaded and proved by a seller, such as the appellant/defendant in this case. An SLP(C) 11702/2018 against the judgment in the case of M.C.Luthra (supra) has been dismissed by the Supreme Court vide order dated 15.5.2018. The relevant paragraphs of the judgment in the case of M.C.Luthra (supra) are paras 4 to 17 and these paras read as under:-
“4. There is no dispute between the parties that parties had entered into an agreement to sell dated 15.9.2005 for the appellant/defendant to sell the subject suit property to the respondent/plaintiff. The total sale consideration was Rs.31.50 lacs and it is not in dispute that at the time of entering into the agreement to sell the appellant/defendant received an amount of Rs.9 lacs with the amount of Rs.7 lacs being paid in terms of demand drafts and a sum of Rs.2 lacs being paid in cash. Disputes and differences arose between the parties as to who was guilty of breach of contract in not performing the agreement to sell dated 15.9.2005. Respondent/plaintiff filed the subject suit pleading that the appellant/defendant was guilty of breach of contract and that therefore in terms of Clause 8 of the subject agreement to sell dated 15.9.2005, the respondent/plaintiff was entitled from the appellant/defendant to double the amount of the money paid of Rs.9 lacs i.e an amount of Rs.18 lacs. The appellant/defendant prayed for the suit to be dismissed and sought a declara