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IN THE HIGH COURT OF DELHI
C. Hari Shankar, J.
Shree Vardhman Infrahome Private Limited - Appellant
Versus
Kushal Verma - Respondent
CM(M) 523 of 2022 and CM Appl. 26549 of 2022 (stay) and CM(M) 536 of 2022 and CM Appl. 26605 of 2022
Decided On : 07-07-2022




Force majeure includes delays due to external restrictions, such as the COVID-19 pandemic and government bans, impacting contract compliance and obligations.

Headnote:(A) Constitution of India - Article 227 - Petitions against the order of the National Consumer Disputes Redressal Commission - Execution of settlement order dated 15th January, 2019 - Parties reached a settlement for the completion and possession of units, which was delayed due to force majeure events. (Paras 1, 2, 3, 10, 22)

(B) Force Majeure - Definition and applicability in contracts - Circumstances like nationwide lockdown and construction bans affecting project timelines fall under force majeure, impacting contract compliance. (Paras 3, 7, 10)

(C) Execution of Settlement Agreement - Individual flat buyers can maintain execution petitions despite their association being the original complainant - Relevant provisions recognized. (Paras 10, 11, 18)

Facts of the case:
Petitioner failed to complete the construction and deliver possession of flats as per the terms set in the settlement agreement, citing force majeure due to COVID-19 and related government restrictions. The respondents filed execution petitions for refunds alleging breaches.

Findings of Court:
The court found that the learned NCDRC did not adequately address the plea of force majeure presented by the petitioner and remanded the matter for reconsideration.

Issues: The key issue was whether the force majeure conditions adequately justified the delays in fulfilling the contractual obligations.

Ratio Decidendi: The court concluded that the learned NCDRC's failure to consider the plea of force majeure in light of the extraordinary circumstances justified remanding the petitions for a reevaluation.

Result: Petitions disposed with a remand to the NCDRC for reconsideration on the grounds of force majeure.

Table of Content
1. execution application and settlement context. (Para 1 , 2 , 3 , 5)
2. force majeure clauses in agreements. (Para 6 , 7 , 8)
3. communication of force majeure by the petitioner. (Para 9 , 10)
4. petitioner’s obligations under the settlement agreement. (Para 11 , 12 , 13)
5. court analysis of force majeure plea. (Para 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21)
6. remand for reconsideration of force majeure. (Para 22 , 23 , 24 , 25 , 26)
7. order conclusion without costs. (Para 29 , 30)

JUDGMENT (Oral)

1. These petitions, under Article 227 of the Constitution of India, assail order dated 25th April, 2022, passed by the learned National Consumer Disputes Redressal Commission ("the learned NCDRC") in a batch of execution applications, seeking execution of the order dated 15th January, 2019, passed by the learned NCRDC in Consumer Case no. 1893/2017, (Flora Welfare Association Vs. Shree Vardhman Infrahome Pvt. Ltd.).

2. The order dated 15th January, 2019 reads thus:

    "Dated: 15 Jan 2019

ORDER

    The matter has been settled between the parties. The learned counsel for the complainant, on instructions from Mr. Sangeet Bali, President of the complainant association who is present in the Court, seeks disposal of the complaint in terms of the written settlement dated 15.01.2019 which is annexed to the application IA No.894 of 2019 filed today in the Court for recording the settlement. The complaint is accordingly disposed of in terms of the settlement dated 15.01.2019 which shall form part of this order. It is also made clear that in case the OP offers to pay the balance payable in kind, such as through additional parking, additional power back-up etc. as per clause 4 and para 2 of the settlement, which shall be for the discretion of the concerned allottees whether to accept such balance in kind such as additional parking, additional power back-up etc. or not. In the event they are not agreeable to accept the said balance in kind, the OP shall pay the balance to them by way of Demand Drafts/bank transfers etc. It has also been agreed between the parties and is ordered accordingly that the aforesaid settlement would not be treated as a binding precedent."

3. The settlement agreement dated 15th January, 2019, in terms of which the learned NCDRC had, vide the afore-extracted order dated 15th January 2019, disposed of Consumer Case 1893/2017, required the petitioner to, inter alia, handover possession of the completed flats/units to the members of Flora Welfare Association, the complainant in Consumer Case 1893/2017, on or before 31st December, 2019, to apply with the concerned authorities for obtaining occupancy certificate in respect of the units on or before 31st March, 2020, and to obtain the occupancy certificate on or before 31st August, 2020.

4. The settlement agreement also incorporated the following clause:

    "(d) It is agreed and understood that the terms of the Apartment Buyer Agreement in so far as the same are not inconsistent with the terms of this settlement, shall continue to binding between the parties."

5. The "Apartment Buyer Agreement" (hereinafter referred to as the "ABA") was, it may be noted, the agreement dated 16th January, 2012 referred to the individual agreements executed between the flat buyers and the petitioner, the alleged breach of the obligations contained in which constituted the basis of Consumer Case 1893/2017.

6. The ABAs, which were identically worded, provided for force majeure in Clause 14(a), which reads thus:

    "14.(a) The Construction of the Flat is likely to be completed within a period of thirty six (36) months of commencement of construction of the particular tower/block in which the Flat is located with a grace period of six (6) months, on receipt of sanction of the building plans/revised plans and all other approvals subject to force majeure including any restraint/restrictions from any authorities, non-availability of building materials or dispute with construction agency/workforc

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