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2023 Supreme(P&H) 3061

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
VINOD S. BHARDWAJ, J.
M/s. Puri Construction Pvt. Ltd. – Petitioner
Versus
Permanent Lok Adalat & Anr. – Respondents
CWP NO.11422 of 2019
Decided On : 10-05-2023

Advocates Appeared:
Mr. B.S.Mittal, Advocate; For the Petitioner
Ms. Samridhi Sareen, Legal Aid Counsel for Respondent No.2.

Headnote:(A) Legal Services Authorities Act, 1987 - Section 22

(C) - Permanent Lok Adalat - Quashing of award - Claim for refund of balance amount sought after considerable delay and alleged duress - Failure to demonstrate proper acknowledgment of liability or reason for delay in pursuing claim under Limitation Act, 1963 - The Permanent Lok Adalat erred by not recognizing the claim as time-barred. (Paras 1, 11, 12, 14, 16)

(B) Limitation Act, 1963 - The claim is barred due to inaction over several years. (Paras 12, 13)

Facts of the case:
The petitioner sought to quash an award directing the refund of a balance amount following a delay of nearly 8 years in raising the claim, perpetuating allegations of coercion and duress regarding a full and final settlement.

Findings of Court:
The court concluded that the Permanent Lok Adalat failed to consider the claim's maintainability under the Limitation Act and allowed its petition.

Issues: Main issues involved determining the validity of a long-delayed refund claim and assessing whether any acknowledgment of liability was made.

Ratio Decidendi: The court established that failure to act within the limitation period precluded the respondent from pursuing the claim, reaffirming the need for acknowledgment in the context of legal actions on liability.

Result: Writ petition allowed; award set aside.

Table of Content
1. factual basis of the refund application (Para 1 , 2 , 3)
2. arguments regarding refund liability and limitation (Para 7 , 8 , 9 , 10)
3. court's detailed analysis on limitation issues (Para 11 , 12 , 13 , 14 , 15)
4. final ruling on the award's validity (Para 16)

JUDGMENT

Vinod S. Bhardwaj, J. (Oral)

The present petition has been filed for seeking quashing of the award dated 08.03.2019 (Annexure P-6) passed by the Permanent Lok Adalat (Public Utility Services), Faridabad in case No. 2906 dated 16.10.2017.

2. Learned counsel appearing on behalf of the petitioner submits that the respondent-applicant had filed an application under section 22 (C) of the Legal Services Authorities Act, 1987 before the Permanent Lok Adalat (Public Utility Services), Faridabad stating that he had booked a flat with an area of 1720 sq. feet in the project advertised by the petitioner in the year 2007 for Sector 82 to 85 in Faridabad with the name "The Paranayam". A sum of Rs. 5,41,800/- had been deposited by the respondent vide receipt No. 22 dated 10.12.2007. The basic sale price of the flat was Rs. 36,12,000/-. Till 21.08.2008, a sum of Rs. 16,33,068/- had been deposited by the respondent-applicant. It was alleged that as there was a slow construction at the site, hence, an application dated 25.02.2009 was submitted by the applicant to the petitioner for seeking refund of his money. No builder buyer agreement was executed between the parties. Various reminders were sent and that finally the request was accepted. Four post dated cheques of Rs. 3,23,928/- each totaling to Rs. 12,95,712/- were issued. The respondent alleged that he was forced to sign blank full and final payment receipt prior to issuing the aforesaid cheques and an oral promise was made to him that the balance amount of Rs. 3,37,359/- shall also be paid in due course. However, they backed out of the promise to pay the balance amount, hence, a letter was sent by him on 06.11.2009 and he had also been continuously visiting the office of the petitioner-builder for seeking the balance amount. Finally a legal notice was served by him on 14.01.2016 but to no avail. The application under Section 22 (C) was thus filed before the Permanent Lok Adalat (Public Utility Services), Faridabad for seeking refund of the balance amount of Rs. 3,37, 359/- alongwith interest @ 24% per annum and other reliefs.

3. The petitioner entered its appearance before the Permanent Lok Adalat (Public Utility Services), Faridabad and submitted response challenging the maintainability of the application before the Forum. It was also pointed out that there was no default on the part of the petitioner-developer and that it had already offered possession of the flat to more than 700 families that were residing there. It was further averred that the petitioner himself made a request for refund on the ground that he was retired government servant and had suffered huge losses and he was thus not in a position to pay the remaining installments. The refundable amount was assessed between the parties and full and final payment of Rs. 12,95,712/- was released in favour of the respondent after permissible deductions. There was no occasion or reason for the respondent to be signing any blank papers especially when the respondent-applicant himself was an educated person and a former government employee in the Engineering Wing. No assurance or acknowledgment has been placed on record to show that the balance amount was ever admitted or acknowledged by the petitioner to be paid to the respondent later. He further submits that despite having executed a letter of full and final settlement and being fully satisfied with the receipt of the aforesaid amount, the application in question was filed by him after a gap of nearly 08 years of the receipt of the amount without giving any reasons as to how the claim itself would be within limitation.

4. Efforts for amicable resolution of the dispute were initiated by the Permanent

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