IMPORTANT POINTS
Once civil suits are filed claiming refund of earnest money, the same cannot be agitated before reference Court u/s 30.
Power u/s 30 is discretionary, confined to the apportionment of the compensation or as to a person to whom the same is payable.

JUDGMENT :

Arun Mishra, J.

1. Leave granted.

2. The appellants-herein are aggrieved by the common judgment and order passed by the High Court of Punjab and Haryana at Chandigarh in F.A. No.1941 of 2013, dated 4th February, 2015. The High Court by the impugned judgment and order has directed refund of the earnest money by M/s. Tanmay Developers Private Ltd. Five agreements to sell were entered into between the M/s. Tanmay Developers Pvt. Ltd. and the land owners on 22.07.2006, 22.07.2006, 22.07.2006, 24.07.2006 and 21.06.2006. Out of the five agreements, earnest money of Rs.54,25,000/- was paid out of the total sale consideration of Rs,4,52,81,250/- as per agreement on 22.07.2006. As per agreement dated 22.07.2006, Rs.1,56,000,00/- was paid as earnest money out of total sale consideration of Rs.12,54,37,500/-. As per yet another agreement on 22.07.2006, earnest money of Rs.21,00,000/- was paid out of a sum of Rs.1,50,93,750/-. As per agreement dated 24.07.2006, earnest money of Rs.90,00,000/- was paid out of total sale consideration of Rs.7,71,31,250/-. As per agreement dated 21.06.2006, earnest money of Rs.2,60,000/- was paid out of a total sale consideration or Rs.14,29,687/-. Period for performance of agreement had expired in the month of September/October, 2006. The land-owners on failure of purchaser to get the sale deed executed forfeited earnest money.

3. A notification under Section 4 of the Land Acquisition Act, 1894 (for short, “the Act”) was issued on 18.3.2008 for acquiring the land which was the subject matter of the agreements. Three suits were filed for recovery of earnest money in September, 2009 and one suit was filed for specific performance of agreement to sell by the respondent-M/s. Tanmay Developer in the month of March, 2008 which was decreed on 18.04.2014 and the appeal filed by the land owners was pending at the time when the impugned judgment and order was passed by the High Court. Similarly, three other suits which were filed for recovery of the earnest money were pending. The Land Acquisition Officer has passed the award on 19.09.2008. No reference under Section 18 of the Act was sought by M/s. Tanmay Developers; however, during the pendency of the suits/appeal the respondent had filed application under Section 30 of the Act for referring the dispute to the Civil Court for refund of earnest money alongwith interest. The Land Acquisition Officer accordingly referred the matter.

4. The Reference Court on 7.12.2012 has passed an award rejecting the prayer made by respondent No.1 on the ground that the dispute with respect to the forfeiture of earnest money and whether M/s. Tanmay Developers Pvt. Ltd. was entitled for specific performance could not be adjudicated under Section 30 of the Act and it would not be appropriate for the Reference Court to decide these disputed issues between the parties in view of civil suits/appeal. The Reference Court held that the dispute under Section 30 of the Act arising out of the apportionment of the compensation or any part thereof involved the vexed question of title or the civil rights of the parties arising out of such transaction could not be adjudicated by substituting the judicial forum into the civil court. The Reference Court could not decide question of refund of earnest money by applying the provisions of Chapter 2 of Part II of the Specific Relief Act, 1963. Such powers can be exercised by the Civil Courts. Aggrieved thereby the respondent No.1 filed appeals before the High Court which have been allowed by the impugned judgment and order.

5. The respondent No.1 had sought apportionment of the compensation only on the ground that agreement for sale had been entered into by the land owners and prayed for refund of the earnest money along with the interest at the rate of 12 per cent per annum, since the agreement had become incapable of being specifically performed due to the acquisition of land. It was contended on behalf of the land owners that Respondent No.1 was n