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2010 Supreme(P&H) 23
PUNJAB & HARYANA HIGH COURT
Deepak Gupta and V.K.Ahuja JJ.
Himachal Pradesh State Industrial Development Corporation
Versus
S.C.Johnson Products Pvt Ltd
Letter Patent Appeal No. 141 of 2007,
Decided On : JANUARY 4, 2010
The petitioner company was bound by the agreement to pay the unearned increase as per the original offer, and therefore was not entitled to the execution of the sale deed until fulfilling this commitment.
Headnote:
Unearned Increase - Dispute over Sale of Industrial Plot - State Financial Corporation Act, 1951, Sec. 29 - The court held that the petitioner company was liable to pay the unearned increase as agreed in the original offer, and therefore entitled to the execution of the sale deed in its favour, subject to the payment of unearned increase.
Fact of the Case:
The petitioner company sought quashing of letters issued by the appellant demanding unearned increase money for the purchase of an industrial plot. The company argued that the sale consideration was fixed at Rs.78.00 lacs and there was no agreement for payment of unearned increase money.
Finding of the Court:
The court found that the petitioner company had agreed to pay the unearned increase as per the original offer, and therefore was liable to fulfill this commitment before being entitled to the execution of the sale deed.
Issues: Dispute over payment of unearned increase money for the purchase of an industrial plot, and the entitlement of the petitioner company to the execution of the sale deed.
Ratio Decidendi: The petitioner company was bound by the agreement to pay the unearned increase as per the original offer, and therefore was not entitled to the execution of the sale deed until fulfilling this commitment.
Final Decision: The court set aside the findings of the learned Single Judge and allowed the appeal filed by the appellant, holding that the petitioner company was entitled to the execution of the sale deed in its favour, subject to the payment of unearned increase.
V. K. Ahuja, J.
1. This is a Letters Patent Appeal filed by the appellant against the judgment passed by the learned Single Judge on 24.10.2007 in CWP No.233 of 2001. By the said judgment, the learned Single judge has allowed the writ petition filed by respondent No.1 as against the appellant and respondent No.2 and had quashed Annexures P18 and P-19, letters dated 27.12.2000 and 19.2.2001, respectively, issued by the respondents, with further direction to the respondents to execute the conveyance deed in favour of the petitioner M/s S. C. Johnson Products Pvt. Ltd. in respect of plot No.70.
2. Briefly stated the facts of the case are that an industrial plot bearing No.70 at Baddi was allotted in favour of M/s Shivalik Video Communication Private Limited, vide communication, dated 7.4.1989, and possession of the plot was also handed over to M/s Shivalik Video. A sale/conveyance deed was also executed in favour of M/s Shivalik Video on 4.9.1989. M/s Shivalik Video also sought permission of respondent No.1 to mortgage the plot with respondent No.2 i. e. Himachal Pradesh Financial Corporation to enable them to avail financial assistance from both the respondents jointly by mortgaging plot No.70. Respondent No.2 (HPFC) sanctioned a term loan of Rs.57.30 lacs in favour of Shivalik Video on 2.5.1988 for establishing an industrial unit at Baddi. The Company availed of the loan of Rs.54,80,860/-. A loan agreement was also entered into in between Shivalik Video and respondent No.2/hpfc on 7.10.1989. Respondent No.2 initiated action under Sec.29 of the State Financial Corporation Act, 1951 against M/s Shivalik Video for realization of the outstanding loan and also took over the possession of the mortgaged/hypothecated assets of M/s Shivalik Video on 29.11.1994.
3. The assets of M/s Shivalik Video were put to sale and the petitioner Company, which was interested to purchase a plot, entered into correspondence with respondent No.2. Respondent No.2, vide its communication, dated 17.9.1996, informed the petitioner Company about the total area of the plot being 6994 square meters and the total constructed area is 12757.75 square feet and that the sale shall take place strictly on "as is where is" basis. The petitioner company was also advised to inspect the assets. A draft of rs.7,80,000/- was sent to the Managing Director of respondent No.2 Corporation informing that they were interested in purchasing the unit and made the offer as under: (i) Rs.78.00 lacs payable as sale consideration (ii) Rs.7.34 lacs as unearned increase money to HPSIDC, if applicable. (iii) Rs.1.50 lacs as maintenance charges due to HPSIDC, if applicable.
4. Respondent No.2 informed the petitioner Company that the offer made by them was acceptable and the petitioner Company was directed to deposit the sale proceeds of Rs.70.20 lacs in addition to Rs.7.80 lacs already deposited by draft. The petitioner Company deposited the amount by way of drafts of Rs.45.00 lacs and Rs.30.00 lacs. An intimation was sent by respondent No.2 to respondent No.1 informing that the purchaser Company, vide letter, dated 10th July, 1997, had deposited the entire sale proceeds of Rs.78.00 lacs with the Corporation and the possession of the assets be handed over to the purchaser. The petitioner company took over the possession of the Unit on 22.7.1997.
5. Respondent No.1 Corporation sent a communication to the petitioner Company on 22nd September, 1999 seeking certain details with regard to unearned increase etc. followed by another letter, dated 19.11.1999. The petitioner Company informed respondent No.1 Corporation that it has already paid the entire dues as advised by respondent No.2 and have also taken over the assets on 22.7.1997. The petitioner Company also wrote letter to respondent No.2 on 18.9.2000 to get executed the sale deed in their favour. Respondent No.1 sent a legal notice to the petitioner Company on 24th December, 1999 whereby the unearned increase/annual maintenance ch
