Bombay High Court
Babulalji Siremalji Maradia vs Sayed Nurulla Quadri And 4 Ors on 5 October, 2023
Bench: Abhay Ahuja
2023:BHC-OS:10196
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION/
IN ITS COMMERCIAL DIVISION
SUMMONS FOR JUDGMENT (L) NO.18872 OF 2022
IN
COMMERCIAL SUMMARY SUIT NO.29 OF 2022
Babulalji Siremalji Maradia ... Plaintiff
Vs.
Sayed Nurulla Quadri and ors. ... Defendants
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Mr.Hitesh Mishra with Mr.Amit Mehta i/by Mr.Amit Mehta, Advocates for the
Plaintiff.
Mr.Rajiv Narula with Mr.Milind Mane i/by M/s Jhangiani Narula and Associates,
Advocates for the Defendants.
-------
CORAM : ABHAY AHUJA, J.
DATE : 05 OCTOBER, 2023.
P.C. :
1. The captioned Commercial Summary Suit (the "said suit") has been filed
by the Plaintiff against the Defendants for amounts due under supplemental
agreement dated 2nd May, 2014 executed between the Plaintiff and Defendants
to compensate the Plaintiff for the deficit carpet area of 270 sq.ft. of shop
premises of a total area of 950 sq.ft. in the newly constructed building in place
of the old Jerambhana building at Bhuleshwar, Mumbai seeking to recover an
amount of Rs.2,15,01,669/- inclusive of interest as on 30 th April, 2022 alongwith
further interest at the rate of 18% p.a. from the date of filing of the suit till
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actual realization thereof.
2. The brief facts are that Plaintiff was a tenant and occupant of the non-
residential premises being shop No.1, ground floor, ad-measuring 950 sq. ft.
carpet area in the building known as Jerambhana at Bhuleshwar, Mumbai,
redevelopment of which building had been undertaken by the Defendants No.1
to 5.
3. The Defendants had on 15th September, 2009 executed the permanent
alternate accommodation agreement with the Plaintiff which was registered
with the Sub-Registrar of Assurances, Mumbai on 17 th September, 2009,
wherein the Defendants being the Promoters had agreed to provide to the
Plaintiff a new shop on the ground floor facing on the road-side of the main road
ad-measuring 950 sq.ft. carpet area on ownership basis in the proposed new
building in lieu of the tenanted premises.
4. In the year 2014, the new premises being shop No.3 on the ground floor
of the new building was handed over to the Plaintiff.
5. It is the case of the Plaintiff that the area of the new shop was 680
sq.ft. carpet instead of 950 sq.ft. carpet leaving behind a deficit of an area of
270 sq. ft. carpet (the "deficit area"). Thereafter, the Plaintiff approached the
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Defendants and called upon the Defendants to make payments as per the market
value of the said new premises for the said deficit area of 270 sq. ft. That it
was agreed that the Defendants would pay to the Plaintiff a lumpsum amount
of Rs.1,20,00,000/- for the deficit area and accordingly, a supplementary
agreement dated 2nd May, 2014 was executed between the Plaintiff and the
Defendants to compensate the Plaintiff for the deficit area.
6. As per the said supplementary agreement, the Defendants had agreed the
following :-
"15. As per the said Supplementary Agreement the
Defendants have agreed the following:
a. to pay the monetary compensation of
Rs.1,20,00,000/-(Rupees One Crore Twenty Lakhs
only) on or before 31st March 2015 in six equal
installments of Rs.20,00,000/- (Rupees Twenty
Lakhs Only) each commencing from April 2014 till
31st March 2015;
b. that in event of default or delay in payment
of the agreed 6 installments on or before 31 st
March, 2015, the Defendants had agreed to make
payment of penalty being interest @18% per
annum on the defaulted amount.
16. The relevant portion/clauses of the Supplementary
Agreement hereinbelow :
"3. The Promoters on or before execution of these
presents have agreed to pay to the tenant a sum of
Rs.1,20,00,000/- (Rupees One Crore Twenty lacs
only) on or before 31 March 2015 and six equal
installments of 20 lakhs each commencing from
April 2014 (time being essence), being the
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compensation for difference in area between the
tenanted shop premises admeasuring 950 sq.ft
carpet area and New Shop Premises admeasuring
680 sq.ft.
4. The tenant acknowledges, agrees and
confirms that on he being put in position of the
new shop premises number three on ground floor
of the new multistoried building, and measuring
680 sq.ft carpet area and on receipt of
Rs.1,20,00,00/- (Rupees One Crore Twenty lacs
only) from the promoters, other tenant , legal
hairs in future will have no claim or demand of
any nature whatsoever against the promoters
under the hearing before recited agreement dated
15 September 2009 and confirms and
acknowledges that the promoters have discharge
their obligation as contained in the urine before
recited agreement dated 15 September 2009 in its
entirety save and except the area of 950 sq.ft shop
shop and the promoters have no further acts or
deeds to be performed under the said agreement
save and except the conveyance title to the
cooperative society or an association of occupiers
to the premises in the new multistoried building
or a limited company to be formed of such
occupiers whether all tenants by way of
permanent alternate accommodation or the flat
buyers of the premises from the promoters.
8. It is hereby further agreed by and between
the parties that any event of default or delay in
payment the penalty will be charged @ 18% p.a.
on default of the amount. "
7. It is the case of the Plaintiff that the Defendants only made a payment of
Rs.35,00,000/- out of the agreed Rs.1,20,00,000/-. The dates on which payment
of Rs.35,00,000/- was made by the Defendants to the Plaintiff is set out in the
table hereinbelow:
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Sr Date Amount (Rs)
No.
1. 9th May 2015 15,00,000
2. 14th October 2019 10,00,000
3. 6th March 2020 10,00,000
8. That despite executing the Supplementary Agreement and agreeing to
make payment of compensation of Rs.1,20,00,000/- (Rupees One Crore Twenty
Lakhs) on or before 31st March 2015, and despite consistent follow up,
Defendants had only made a part payment of Rs.35,00,000/- (Rupees Thirty-
Five Lakhs only) in tranches as above.
9. That as the Defendants failed and neglected to make the payment of
outstanding sum to the Plaintiff, the Plaintiff left with no option issued legal
notice, through his Advocate on 14 th January 2019 to the Defendants, calling
upon the Defendants to pay the balance amount of Rs.1,05,00,000 with an
interest of 18% p.a. The same was replied to by the Defendants by their letter
dated 2nd February 2019 acknowledging the fact that amounts are due and
payable to the Plaintiff. The Defendants in their letter dated 2 nd February, 2019
inter-alia stated that:
"As regarding payment of balance amount, I have personally told
you again. And now I would like to mention here that, we are
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passing through financial crises therefore we are unable to pay
you the balance of Rs.65,00,000/- (Rupees Sixty-Five Lacs Only).
I assure you that as soon as we receive amount first, we shall
make payment to you."
10. That since despite follow up, Defendants failed and neglected to make the
payment of outstanding amounts due and payable under the Supplementary
Agreement of Rs.85,00,000/- (Rupees Eighty Five Lakhs) to the Plaintiff along
with interest @ 18% p.a. as on 30 th April 2022, amounting to Rs.2,15,01,669
(Rupees Two Crores Fifteen Lakhs One Thousand Six hundred and Sixty Nine
only), the Plaintiff issued another legal notice, through his Advocate on 20 th
December 2021 to the Defendant.
11. It is the Plaintiff's case that despite the receipt of the said notice dated 2 nd
December 2021, the Defendants have failed and neglected to make payment.
12. Thereafter, on 5th January 2022, the Plaintiff through his Advocate issued
a reminder Notice to the Defendants calling upon them to make payment of
outstanding dues of the Plaintiff, but again despite of receipt of the said
reminder, the Defendants failed and neglected to make payment of the
outstanding dues and/or reply to the reminder notice.
13. It is the case of the Plaintiff that since despite the Plaintiff's efforts to
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reach out to the Defendants to make the balance payment to the Plaintiff, the
Defendants avoided in making the payments to the Plaintiff and therefore, the
Plaintiff has filed the subject Summary Suit for an order and decree of a sum of
Rs.2,15,01,669/- with interest at the rate of 18% p.a. The Defendants entered
appearance after which on 15 th June, 2022 the Plaintiff has filed Summons for
Judgment. The Defendants have filed the affidavit-in-reply to the Summons for
Judgment on 10th July, 2023, after which on 21 st July, 2023 affidavit-in-rejoinder
has been filed on behalf of the Plaintiff.
14. The Defendants have in their reply raised two fold contentions against the
claim by the Plaintiff under the Summons for Judgment. Firstly, it is submitted
that the suit is barred by limitation in as much as the suit is in respect of the
documents executed in the year 2014 and therefore, not maintainable as
Summary Suit, since the Plaintiff has failed to show the extension of limitation
under section 19 of the Limitation Act, 1963. It is therefore submitted that the
Summons for Judgment be dismissed in limine.
15. The other contention is that the Plaintiff is guilty of suppression of
material facts and documents.
16. That the Defendants have made a payment of Rs.58,00,000/- out of
Rs.1,20,00,000/- as agreed in the supplementary agreement dated 2 nd May,
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2014 and which payments to the Plaintiffs have been made in the following
manner :
Sr Date of Payment Mode of Payment Amount
No.
(Rs)
1 28th March, 2014 Cash 6,00,000
2 9th January, 2016 Cash 4,00,000
3 7th April, 2016 Cash 3,00,000
4 6th May, 2016 Cheque 15,00,000
5 5th December, 2016 Cash 10,00,000
6 10th October, 2019 Cheque 10,00,000
7 5th March, 2020 Cheque 10,00,000
TOTAL 58,00,000
17. It is the Defendants' case that subsequent to the development of the said
property, new premises being Shop No.3 on the Ground Floor of the new
building ad measuring 760 sq. ft was handed over to the Plaintiff in the year
2014 and that the Plaintiff has therefore made a false statement on oath, by
stating that new allotted premises was 680 sq.ft instead of the 760 sq ft.
Therefore, the deficit area of the new premises in comparison with the old
premises was of 190 sq. ft instead of 210 sq. ft as stated by the Plaintiff in his
Plaint as well as Summons for Judgment along with Affidavit in Support thereof.
19. That the Defendant has recently come to know that, as per MAHDA's
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Assessment the carpet area of the said shop is 85.76 sq.mts which is equivalent
to 923.113 sq ft. Therefore, as of today, the deficit area is only 27 sq.ft. That the
Supplementary Agreement which was executed between the Plaintiffs and the
Defendants was to compensate the Plaintiff for the deficit area and since the
deficit area is only 27 sq.ft. and not 190 sq.ft. as mentioned in Paragraph 5.6, it
is clear that, the Defendants have already paid the Plaintiffs more money than
which is required to be paid to them for compensation of the actual deficit area
i.e. 27 sq. ft.
18. In the above facts, it is submitted on behalf of Defendants that the
Plaintiff is guilty of suppressing material facts and vital information. That
therefore there are "triable issues" in the matter since the claim of the Plaintiff is
grossly inflated as the Plaintiff has concealed from this court vital information
regarding several payments made by the Defendants to the Plaintiff.
19. It is therefore submitted on behalf of the Defendants that the Summons
for Judgment be dismissed and unconditional leave be granted to the
Defendants to defend the suit.
20. I have heard the learned counsel for the parties and considered the rival
contentions.
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21. Admittedly, the total amount of compensation towards the deficiency of
rehab area as accepted by both the Plaintiff and the Defendants is
Rs.1,20,00,000/- . By communication dated 2 nd February, 2019, the Defendants
have not only admitted to the aforesaid amount of Rs.1,20,00,000/-, but also
submitted that they have paid an amount of Rs.55,00,000/- and that they are
unable to pay the balance of Rs.65,00,000/- as they are passing through
financial crises. By the said letter the Defendants have assured the Plaintiff that
as soon as they receive the amount, first they will make payment to the Plaintiff.
22. In the reply the Defendants have stated that they have made the payment
of Rs.58,00,000/-to the Plaintiff which includes payment made of Rs.6,00,000/-
made by cash which the Defendants submit was made prior to the signing of the
supplementary agreement and which was to be included in the payment
decided to be made under the said supplementary agreement as the Plaintiff
and Defendants had a long standing business relation. The Defendants have
annexed copies of the cash vouchers purportedly issued by the Defendants to the
Plaintiff. In the plaint the Plaintiff has agreed that Rs.35,00,000/- has been
made over to the Plaintiff by the Defendants. A comparison between the table
at paragraph No.19 of the plaint and paragraph No.5.6 of the Defendants'
reply to the Summons for Judgment both of which have also been set out above,
clearly indicates that the amounts of the three payments referred to in
paragraph No.19 of the plaint though of different dates appear to correspond
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to the amounts of the three cheque payments referred to in paragraph No.5.6 of
the reply. Further, even if the last payment of Rs.10,00,000/- by cheque on 5 th
March, 2020 as set out in the reply of the Defendants were to be taken, the
suit which is stated to be filed on 4 th May, 2022, in my view would be within
the period of limitation.
23. However, on the basis of the following two aspects, I am of the view
that there are triable issues in the matter: one is that although in the letter
dated 2nd February, 2019 the Defendants have claimed that they have paid
Rs.55,00,000/- to the Plaintiff leaving a balance of Rs.65,00,000/- for which
they have given an assurance to pay to the Plaintiff as soon as they clear the
financial crises, in the plaint as well as in the reply of the Defendants there is
reference to a payment in the month of March, 2020 of Rs.10,00,000/- by
cheque (which the Plaintiff claimed to have been made on 6 th March, 2020 and
Defendants claimed to have been made on 5 th March, 2020). As also the earlier
payment of Rs.10,00,000/- by cheque (as claimed by the Plaintiff to have been
made on 14th October, 2019 and to have been made on 10 th October, 2019 by
the Defendants). Both these payments totalling to Rs.20,00,000/- are after the
letter dated 2nd February, 2019 by the Defendants. If these two payments
totalling to Rs.20,00,000/- made after 2 nd February, 2019 are accounted for,
then the same will have to be deducted from the admitted outstanding of
Rs.65,00,000/- bringing the outstanding to Rs.45,00,000/-. But the Plaintiff
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claims to have received by cheque only Rs.35,00,000/- leaving a balance of
Rs.85,00,000/- without interest. The Defendants in their reply have submitted
that Rs.58,00,000/- including cash of Rs. 23,00,000/- has been paid to the
Plaintiff and also sought to rely upon the cash vouchers at Exhibits A-1 to A-7
(which though have been denied by the Plaintiff as bogus) in addition to the
claim that Rs.6,00,000/- cash was paid prior to the supplementary agreement
due to business relation. All these contentious issues, in my view will require a
factual determination and consideration in a trial pursuant to evidence that
will have to be led by the parties.
24. Secondly, although it is observed from the supplementary agreement
dated 2nd February, 2014 between the Plaintiff and the Defendants that the
area of permanent alternate accommodation mentioned therein is 680 sq. ft.
and the deficit area is 270 sq.ft., however, the admission letter dated 2 nd
February, 2019 seeks to clarify that the carpet area occupied by the Plaintiff is
760 sq. ft. as per RERA. This aspect will also need to be considered in a trial
even if the issue with respect to MHADA's assessment of the carpet area of the
said shop is considered to have been brought up for the first time in the
affidavit-in-reply and not forming part of the agreement between the Plaintiff
and the Defendants.
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25. It is also pertinent to observe that the Defendants have also in the
affidavit-in reply to the Summons for Judgment in paragraph No.23 clearly
admitted that there is a delay in payment of the remaining amount as there
were multiple inter-se disputes between the partners as a result of which the
business got adversely affected and had slipped into disarray. Paragraph No.23 of
the said reply is pertinent and is usefully quoted as under :-
"23. With referent to Paragraph No.22, I deny that the
Defendants have without any valid justification withheld
outstanding payment. I say that the Defendants have valid
reasons for the delay in the payment of the remaining amount
as there were multiple inter se disputes between the partners
as a result of which the business got adversely affected and
had slipped into the state of disarray. There were also severe
problems with making arrangement for funds due to the
Covid 19 pandemic resulting in national lockdown and
affecting the business. The delay in payment is also due to
disagreement over the amount of payment between us and the
Plaintiff as the Plaintiff have to the reasons best known to
them always failed to acknowledge the payment that was
made by us in cash."
26. In my view therefore triable issues have been raised and therefore, in
view of the law laid by the Hon'ble Supreme Court in the case of B.L.Kashyap
and sons Vs. M/s JMS Steels Power Corporatio and another 1, I pass the
following order:-
ORDER
i. Leave to defend the present suit is granted to the Defendants subject to
depositing a sum of Rs.65,00,000/- within a period of six weeks from today.
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ii. If the aforesaid deposit is made within the stipulated period, this suit
shall be transferred to the list of Commercial Causes and the Defendants shall
file written statement within a period of six weeks from the date of deposit.
iii. If this conditional order of deposit is not complied with within the
aforementioned period, the Plaintiff shall be entitled to apply for an ex-parte
decree against the Defendants after obtaining a Non-Deposit Certificate from
the Prothonotary and Senior Master of this Court.
iv. Summons for Judgment stands disposed in the aforesaid terms.
(ABHAY AHUJA, J.)
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Signed by: Priya Soparkar
Designation: PA To Honourable Judge
Date: 07/10/2023 21:32:04
