Back
2020 Supreme(Del) 1200
IN THE HIGH COURT OF DELHI AT NEW DELHI
S. Muralidhar, Talwant Singh, JJ.
Dharampal Satyapal Limited - Appellant
Versus
Sanmati Trading And Investment Ltd & Anr. - Respondent
First Appeal From Order (Os) No. 219 of 2016, 373 of 2016, 131 of 2017; Civil Miscellaneous Application No. 51834 of 2019
Decided On : 16-01-2020
Deepak Dhingra, Advocate, Isanda Soloman, Advocate, Yakesh Anand, Advocate, Nimit Mathur, Advocate
The central legal point established in the judgment is the necessity of seeking a declaration of termination of the agreement to sell as void for maintaining a suit for specific performance.
Headnote:
Specific Performance - Agreement to Sell - Civil Procedure Code - [IA No.3276/2011, Order VI Rule 17, Order VI Rule 18, CS(OS) No.320/2006] - The court discussed the amendment of reliefs, the limitation for claiming damages, and the entitlement to the relief of specific performance. The court also considered the necessity of seeking a declaration of termination of the agreement to sell as void, as per the law explained by the Supreme Court in I. S. Sikandar v K. Subramani (2013) 15 SCC 27.
Fact of the Case:
The Plaintiff sought specific performance of an Agreement to Sell for a property in New Delhi. The Defendant resiled from the agreement, leading to a legal dispute. The Plaintiff also sought to add the relief of declaration and cancellation of a sale deed, possession, and damages as alternative relief to specific performance.
Finding of the Court:
The court found that the Plaintiff's failure to seek a specific declaration to declare the cancelling of the agreement by the Defendant as void led to the central prayer in the suit of specific performance not being capable of being granted. The appeals were dismissed, and no costs were awarded.
Issues: The issues included the entitlement to the relief of specific performance, the amendment of reliefs, the limitation for claiming damages, and the necessity of seeking a declaration of termination of the agreement to sell as void.
Ratio Decidendi: The court's decision was influenced by the law explained by the Supreme Court in I. S. Sikandar v K. Subramani (2013) 15 SCC 27, which emphasized the necessity of seeking a declaration of termination of the agreement to sell as void for maintaining a suit for specific performance.
Final Decision: The appeals were dismissed, and the pending application was also disposed of. No costs were awarded.
JUDGMENT
S. Muralidhar, J. - These are three appeals by the Appellant Dharampal Satyapal Limited, the Plaintiff in CS(OS) No.320/2006, against the Respondents/Defendants Sanmati Trading And Investment Ltd (Defendant No.1) and Veejay Buildwell Pvt. Ltd. (Defendant No.4). The Director of Defendant No.1, Mr. V. Sundaram was Defendant No.2 and his wife was impleaded as Defendant No.3 in the said suit.
2. While FAO(OS) No.219/2016 is directed against an order dated 2nd May, 2016 of the learned Single Judge passed in IA No.3276/2011 filed by the Plaintiff under Order VI Rule 17 of the Civil Procedure Code ("CPC"), FAO(OS) No.373/2016 is directed against an order dated 5th October, 2016, whereby the Plaintiff was debarred from carrying out the amendment that was allowed by the order dated 2nd May 2016.
3. The third appeal being FAO(OS) No.131/2017, is directed against an order dated 23rd February, 2017 passed by the learned Single Judge, deciding the preliminary issue (i) against the Plaintiff, and holding that the Plaintiff is not entitled to the relief of specific performance for the reasons of not having claimed the relief of declaration of the termination, admittedly effected by the Defendant No.1 by letters dated 1st March and 22nd March, 2005, of the Agreement to Sell as void.
4. The Court would first like to deal with the third appeal being FAO(OS) No.131/2017, since the issue involved therein goes to the root of the suit filed by the Plaintiff.
5. The suit filed by the Plaintiff sought specific performance of an Agreement to Sell dated 17th June, 2004, in terms of which, according to the Plaintiff, the Defendant No.1 agreed to sell the property bearing number 3, Friends Colony (West), New Delhi (hereafter, "the property in question") to the Plaintiff. According to the Plaintiff, pursuant to the agreement between the Plaintiff and the Defendant No.1 that the property in question would be sold to the Plaintiff for a sum of Rs.16.29 crores, the Plaintiff paid to the Defendant No.1 a sum of Rs.11 lacs.
6. According to the Plaintiff, instead of completing the sale, the Defendant No.2, on 1st March, 2005, wrote a letter resiling from the agreement and returning to the Plaintiff the sum of Rs.11 lacs by way of a cheque dated 1st March, 2005. Defendant No.2 stated that "the agreement signed by the parties and kept in a sealed cover, be cancelled and returned to Defendant No.1".
7. The Plaintiff states that it replied on 14th March, 2005, registering its protest, asserting that it had always been and still was ready and willing to pay the balance sale consideration and that it was willing to execute the necessary documents so that the sale transaction could be completed without further delay "at one go". The Plaintiff claimed that it had also returned the cheque dated 1st March, 2005, for the sum of Rs.11 lacs to the Defendant No.1.
8. On 22nd March, 2005, the Defendant No.1, under the signatures of the Defendant No.2, claimed that the returned cheque was not found enclosed with the Plaintiff''s letter dated 14th March, 2005. The Defendant No.1 also reiterated that "the deal stands cancelled" on account of the Plaintiff''s "failure to pay the total sale consideration". The Plaintiff reiterated its stand by a further letter dated 28th March, 2005 and thereafter filed CS(OS) No.320/2006 on 30th December, 2005.
9. It transpired that by a registered sale deed dated 10th June, 2005, the Defendant No.1 sold the property in question to the Defendant No.4 (i.e. Respondent No.2 in the appeal). This led to the Plaintiff filing IA No.6351/2008 in May, 2008, seeking to implead Defendant No.4 as a party Defendant. The said application was allowed on 18th March, 2014.
10. In the meanwhile, the Plaintiff filed IA No. 3276/2011, seeking to add the relief of declaration i.e. declaring the transaction of sale by the Defendant No.1 in favour of Defendant No.4 Veejay Buildwell Pvt. Ltd. by the registered sale deed dated 10th June, 2005 to be bad in law. T
