C.S.No.54 of 2009

IN THE HIGH COURT OF JUDICATURE AT MADRAS

Judgment Reserved on : 28.04.2023

Judgment Pronounced on : 28.07.2023

CORAM : JUSTICE N.SESHASAYEE

C.S.No.54 of 2009

Parinee Realty Private Limited

formerly known as

Green Bird Developers Private Ltd.,

.... Plaintiff

(Amended as per oder dated 10.03.2016 in

A.No.1243 of 2016 in CS.No.54 of 2009)

Vs

M/s.Peirce Leslie India Limited

.... Defendant

Prayer : Civil Suit filed under Section Order IV Rule 1 of O.S.Rules read with

Order VII Rule 1 of CPC., praying for a judgment and decree against the

defendants :

(a) for a sum of Rs.1,00,00,000 (Rupees one crore) claimed and further

interest at 18% p.a., from the date of the plaint till realization.

(b)to award the costs of the suit.

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C.S.No.54 of 2009

(c) To pass further order that may deem fit in the circumstances of the

case.

For Plaintiff

: Mr.Sathish Parasaran, Senior Counsel

Asst. by Ms.Aparajitha Viswanathan

For Defendant

: Mr.Krishna Srinivasan

for M/s.Ramasubramanian & Associates

JUDGMENT

The suit is filed for recovery of a sum of Rs.1.0 crore paid as advance amount

by the plaintiff to the defendant under a Memorandum of Understanding dated

23.04.2008, with future interest at 18% per annum.

The Pleadings:

2. The case of the plaintiff is follows:

● The plaintiff is a Private Limited Company engaged in the business of

promoting multi-storeyed apartments and villas. It is headquartered in

Mumbai. It proposed to expand its activities in Kerala, and was scouting

for suitable lands there.

● The defendant is also a company registered under the Companies Act,

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with its registered head office at Chennai. It owns lands measuring 6.56

acres at Mamally, Feroke near Calicut. It has nominated M/s Wisma

Project Management Services, another Chennai based company, (not a

party to the litigation), as its agent/consultant, for negotiating the sale of

the said property.

● While so, sometime in April, 2008, the plaintiff came across the

defendant's agent Wisma Consultants, to whom the plaintiff has

conveyed that the former was looking for lands for developing and

promoting residential apartments and villas, and the agent of the

defendant informed the plaintiff about the 6.56 acres land which the

defendant owns in Kerala.

● The plaintiff negotiated with the agent of the defendant, M/s Wisma

Project Management Services. Indeed, Wisma Consultants informed the

plaintiff vide a letter dated 15.04.2008, that it is acting on behalf of the

defendant. It also enclosed a draft Memorandum of Understanding

(MoU) along with the said letter, and informed the plaintiff that the deal

could be finalised along the lines of the draft MoU. The plaintiff was also

informed that the price of the land and the other conditions stipulated in

the draft MoU are non-negotiable. The price of the land was fixed at

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C.S.No.54 of 2009

Rs.1,50,000/- per cent (which implied the total consideration for the

property is around Rs.9.86 crores).

● On 23.04.2008 the MoU was executed, under which the plaintiff paid an

advance of Rs.1.0 crore through a cheque. The remaining sale

consideration is required to be paid in two instalments: (a) the first

instalment was Rs.3.0 crores to be paid within 30 days of the date of the

MoU; and (b) the second and final instalment is required to be paid on or

before 60 days from the date of the MoU. In short, the MoU provided for

60 days time for the parties to complete performance of their respective

contractual obligations.

● After signing the MoU, the plaintiff came to know that the subject

matter of MoU was notified as 'red zone' by the Planning Authority,

which implied that was notified as exclusive industrial zone, and not for

residential purposes. The plaintiff was oblivious