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High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE D. HARIPARANTHAMAN
Himayam Engineers and Builders Represented by its Proprietor P. Ramana Reddy
Versus
S. Ravichandran & Others
C.S.NO.460 of 2005
Decided on : 30-03-2012
Suit for specific performance of development agreement - Plaintiff failed to obtain plan approval from CMDA within a reasonable time - Development agreement lacks minuet details relating to construction of multi-storeyed complex - Plaintiff not entitled to equitable relief of specific performance - Plaintiff is not entitled to damages in the absence of evidence - Plaintiff entitled to refund of advance amount without interest - Suit is liable to be dismissed, in view of the earlier suit filed by the plaintiff, on the same cause of action, in view of Order II Rule 2 C.P.C.
Fact of the Case:
Plaintiff entered into a development agreement with the defendants for the construction of a multi-storeyed complex on the suit property. The plaintiff was to obtain plan approval from CMDA for the construction. The plaintiff applied for plan approval but failed to obtain it within a reasonable time. The defendants terminated the agreement. The plaintiff filed a suit for specific performance of the agreement and for damages.
Finding of the Court:
The court held that the plaintiff was not entitled to the equitable relief of specific performance because he failed to obtain plan approval from CMDA within a reasonable time and the development agreement lacked minuet details relating to the construction of the multi-storeyed complex. The court also held that the plaintiff was not entitled to damages in the absence of evidence. However, the court held that the plaintiff was entitled to a refund of the advance amount without interest. The court also held that the suit was liable to be dismissed, in view of the earlier suit filed by the plaintiff, on the same cause of action, in view of Order II Rule 2 C.P.C.
Issues: ['Whether the plaintiff is entitled to get a decree for specific performance of contract on the basis of development agreement dated 10.09.2003 and to get a consequential order of permanent injunction as prayed for?', 'Whether the plaintiff is entitled to the alternative relief of Rs.71,00,000/-towards damages for breach of suit agreement and Rs.20,00,000/-being the return of advance amount?', 'Whether the suit land subjected to any land acquisition proceedings of the Tamil Nadu Housing Board?', 'Whether the plaintiff has failed to perform his part of the contract?', 'Whether clause 18 of the development agreement dated 10.09.2003 will be applicable?', 'Whether the plaintiff is entitled to claim any damages in spite of his inordinate delay in executing the contract?', 'Whether the plaintiff has any cause of action to file the suit?', 'To what relief, the plaintiff is entitled?']
Ratio Decidendi: The court held that the plaintiff was not entitled to the equitable relief of specific performance because he failed to obtain plan approval from CMDA within a reasonable time and the development agreement lacked minuet details relating to the construction of the multi-storeyed complex. The court also held that the plaintiff was not entitled to damages in the absence of evidence. However, the court held that the plaintiff was entitled to a refund of the advance amount without interest. The court also held that the suit was liable to be dismissed, in view of the earlier suit filed by the plaintiff, on the same cause of action, in view of Order II Rule 2 C.P.C.
Final Decision: The court decreed the suit in part so far as the claim for refund of advance amount is concerned and directed the defendants to refund the advance amount, within a period of three months from the date of the order, failing which, the defendants shall pay interest at the rate of 9% per annum from the date of the order till actual payment is made. In all other aspects, the suit was dismissed with a direction to the plaintiff to pay a cost of Rs.1,00,000/- (Rupees One Lakh Only) to the defendants.
1. The present suit is filed for specific performance of the development agreement dated 10.09.2003 entered into between the plaintiff and the defendants 1 and 2 represented by their power of attorney agent, the third defendant herein. The plaintiff also prayed for permanent injunction restraining the defendants from in any manner interfering with the plaintiff from proceeding with construction in the suit property in accordance with the approved plan hereafter to be obtained from the Chennai Metropolitan Development Authority. Alternatively, the plaintiff prayed for direction to the defendants 1 and 2 to pay the plaintiff a sum of Rs.71,00,000/-(Rupees Seventy One Lakhs Only) towards damages for breach of development agreement and Rs.20,00,000/- (Rupees Twenty Lakhs Only) being the return of advance amount, in all a total sum of Rs.91,00,000/-(Rupees Ninety One Lakhs Only).
2. The averments made by the plaintiff in the plaint are as follows:
(a) The plaintiff entered into a development agreement on 10.09.2003 with the third defendant, who is the power of attorney agent of the defendants 1 and 2 to develop four plots of land in S.No.415, Mogappair Village, Saidapet Taluk, Chengalpet District. Out of the four plots, two plots belong to the first defendant and the same was shown as item nos.1(a) and 1(b) in the schedule to the plaint. The remaining two plots belong to the second defendant and the same was shown as item nos.2(a) and 2(b) in the schedule to the plaint. Pursuant to the development agreement, the defendants put the plaintiff in possession of the suit property.
(b) As per the development agreement, the plaintiff shall construct a multi-storeyed complex on the suit property exclusively at his cost as per the building plan as may be permitted by the authorities concerned.
(c) As per the development agreement, the plaintiff shall commence the construction of the building within 30 days of obtaining sanction for the building plan and complete the same within 18 months with a grace period of three months from the date of plan sanction.
(d) As per the development agreement, the plaintiff and the defendants shall share the constructed area upon the suit property in the ratio of 56:44, that is, 56 % for the plaintiff and 44 % for the defendants 1 and 2, being the owners of the property.
(e) After the defendants made available the patta, which is a necessary document to be submitted for plan sanction before the Chennai Metropolitan Development Authority (CMDA), the plaintiff submitted an application dated 23.01.2004 to the CMDA for plan approval.
(f) The CMDA informed the plaintiff that he shall produce a No Objection Certificate (NOC) from the Tamil Nadu Housing Board (TNHB) as the suit property comes under the TNHB Land Acquisition Notification.
(g) The plaintiff informed the defendants about the said fact and the defendants agreed to apply for NOC from the TNHB.
(h) Accordingly, the defendants obtained NOC from TNHB and handed over the same to the plaintiff on 25.06.2004. The plaintiff immediately submitted the same to the CMDA.
(i) However, the said NOC was not accepted by the CMDA for the reason that the same was vague and not clear. The CMDA called upon the plaintiff to get a clear and fresh NOC from the TNHB.
(j) The plaintiff took lot of pains and obtained a fresh NOC from TNHB on 31.10.2004 and submitted the same to CMDA.
(k) According to the plaintiff, the delay of 13 months in submitting the NOC was caused entirely due to the defendants failure to produce NOC from TNHB.
(l) The plaintiff cleared bushes and demarcated the boundaries of the suit property as directed by the CMDA and also dug out a well for construction purposes.
(m) The plaintiff paid a sum of Rs.10,00,000/-to the defendants 1 and 2 as refundable advance on the date of development agreement and later, on the request of the defendants 1 and 2, the plaintiff paid a sum of Rs.4,00,000/-on 14.01.2004 and Rs.1,00,000/- on 23.03.2004 and
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