Mool Chand Gupta vs Oriental Bank Of Commerce
2011 Latest Caselaw 805 Del

     IN THE HIGH COURT OF DELHI AT NEW DELHI


+                RFA 424/2006


%                         Judgment delivered on: 10.02.2011

     Mool Chand Gupta             ...... Appellant
              Through: Ms.Latika Chaudhary, Advocate.


                          versus


     Oriental Bank of Commerce       ..... Respondent
                Through: Ms.Kittu Bajaj, Advocate



CORAM:
HON'BLE MR. JUSTICE KAILASH GAMBHIR

1.   Whether the Reporters of local papers may
     be allowed to see the judgment?                         Yes

2.   To be referred to Reporter or not?                      Yes


3.   Whether the judgment should be reported
     in the Digest?                                          Yes

KAILASH GAMBHIR, J. Oral

*

1. By this regular first appeal filed under Section 96

of Code of Civil Procedure, 1908 the appellant seeks to

challenge the judgment and decree dated 24.04.2006 passed

by the learned trial court whereby the suit filed by the

appellant for recovery of Rs.7.60 lacs was decreed in favour of

the appellant by only awarding damages of Rs.5,000/- along

with interest on the delayed payment.

2. Brief facts of the case relevant for deciding the

present appeal are that the appellant was working as a

branch office manager in the respondent bank and opted for

the Voluntary Retirement Scheme 'VRS' offered by the

respondent bank. That as per the said scheme the appellant

was to be relieved on 15.1.01 and all his retrial benefits were

to be released within 45 days i.e on 1.3.01 but due to delay,

the payment was only made on 20.3.01. In the meanwhile, the

appellant entered into a transaction for purchase of a plot of

Rs.7 lacs and paid an earnest money of Rs 2 lacs by borrowing

from his friends and relatives and the remaining amount of

Rs.5 lacs was to be paid by 4.3.01, but due to the delay in the

release of payment of the retrial dues, the earnest money was

forfeited. Thereafter the appellant filed a suit for recovery of

Rs.7.60 lacs which was decreed in favour of the appellant for

Rs.5000 with costs alongwith interest. Feeling aggrieved with

the same, the appellant has preferred the present appeal.

3. Assailing the said judgment and decree, Ms.Latika

Chaudhary, learned counsel appearing for the appellant

contended that the learned trial court failed to take into

consideration the loss suffered by the appellant due to his

failure to pay the balance sale consideration amount of Rs.5

lacs to the seller of the property with whom the appellant had

entered into sale transaction anticipating the payment of

retiral benefits within the specified time given by the

respondent-Bank under the VRS Scheme. The contention of

counsel for the appellant was that the appellant had paid the

earnest amount of Rs.2 lacs to the vendor of the property, but

since the appellant failed to pay the balance sale

consideration amount of Rs.5 lacs to the vendor of the said

property within the time agreed to between the parties,

therefore, the earnest amount of Rs.2 lacs paid by the

appellant was forfeited by the vendor of the property and this

loss of Rs.2 lacs can be easily attributed to the respondent-

Bank, as had the respondent-Bank paid the said retiral

benefits within the said period of 45 days in terms of the VRS

Scheme, then the appellant would have been in a position to

pay the balance sale consideration amount of Rs.5 lacs to the

vendor of the said property within the agreed time.

4. Another contention raised by counsel for the appellant

was that the said property was ultimately sold by the vendor

to some other person for a sum of Rs.10 lacs which would

mean that had the appellant been successful in purchasing

the plot then he would have gained the profit of Rs.3 lacs

instead of the said vendor of the said property. Counsel thus

submits that in this manner the net loss occasioned to the

appellant was Rs.5 lacs (Rs.3 lacs plus interest) due to the

failure of the said sale transaction. Counsel also submits that

the appellant had taken the decision to seek voluntary

retirement from the respondent-Bank with a view to purchase

a property out of the retiral benefits to be received by him,

but the said purpose and objective of the appellant was

defeated by the respondent-Bank due to the delay caused by

them in releasing the retiral benefits to the appellant. Counsel

for the appellant also submits that in terms of the VRS

Scheme announced by the respondent-Bank, the Bank had

clearly represented that they will make the payment of the

entire retiral dues in lump sum within a period of 45 days

from the date when an employee is relieved from his service.

The contention of counsel for the appellant is that it was

incumbent upon the respondent-Bank to have released the

payment of the entire retiral dues in lump sum within the said

period of 45 days and for any delay on the part of the

respondent-Bank the appellant is entitled to recover the

damages as suffered by him due to the failure in the sale

transaction. Counsel for the appellant also submits that some

of the retiral dues are still outstanding which are yet to be

paid by the respondent-Bank.

5. Opposing the present appeal, counsel for the

respondent-Bank submits that the period of 45 days given in

the VRS Scheme was never the essence of the Scheme, as the

said period was given to the employees seeking VRS to

complete all procedural formalities before the release of the

final amount of the retiral dues. Counsel further submits that

the appellant was paid the entire retiral dues on 20.03.2001

and, therefore, just a delay of 20 days had occurred on the

part of the bank in the release of the said dues for which the

learned trial court has already granted a compensation of

Rs.5,000/- in favour of the appellant. The contention of

counsel is that no fault can be found in the impugned

judgment and decree passed by the learned trial court, as the

learned trial court has already granted the compensation

much in excess than the loss suffered by the appellant or

proved on record by the appellant.

6. I have heard learned counsel for the parties and

have gone through the records.

7. A suit for recovery of Rs.7.60 lacs was filed by the

appellant herein against the respondent-Bank. The appellant

claimed the said compensation amount from the respondent-

Bank on the ground that he took the voluntary retirement

from his service after opting for VRS Scheme announced by

the respondent-Bank, but he was not paid the entire retiral

dues within the period of 45 days from the date of his being

relieved from service and there was a delay of 20 days in the

payment of the said retiral dues. The argument of counsel for

the appellant is that the said period of 45 days stipulated in

the VRS Scheme was of binding nature and under no

circumstance the payment of retiral dues could have been

delayed by the respondent-Bank. As per the case set up by the

appellant this delay of 20 days has caused a loss of Rs.7.60

lacs to the appellant as he had entered into an agreement to

sell to purchase a plot for a sum of Rs.7 lacs for which he had

paid an amount of Rs.2 lacs towards the earnest money after

having borrowed the same from his relatives and friends on

interest @ 3.50% p.a. The appellant has further claimed that

he could not purchase the said plot because of the said retiral

dues not being released by the respondent-Bank within the

said time bound period and, therefore, the amount of Rs.2

lacs paid by him towards the earnest money was forfeited by

the seller of the said property. The appellant has further

claimed an amount of Rs.5 lacs which he is alleged to have

suffered due to the sale of the said plot in question by the

seller to some other person at a later period for a sum of

Rs.10 lacs.

8. It would be thus evident that the compensation

amount which has been claimed by the appellant is primarily

on account of his failure to purchase the said plot, decision for

which he had taken based on the representation made by the

respondent-Bank under the VRS Scheme that he would get all

his retiral dues within the period of 45 days from the date of

his being relieved from the service. Indisputably, the period of

45 days has been duly stipulated under the said VRS Scheme

for the final payment of retiral dues and the learned trial

court has also taken a view that it was obligatory on the part

of the bank to have paid the entire retiral dues of the

appellant within the said period of 45 days as announced by

the respondent-bank under the VRS Scheme. There was,

however, a delay of 20 days in the payment of said retiral

dues.

9. The question which arises is whether this delay of

20 days can make the appellant entitled to claim damages to

the tune of Rs.7.60 as claimed by him in the said recovery

suit. In order to entitle a person to the grant of any damages

by reason of breach of the contract, the injury for which

compensation is asked for should be one that may be fairly

taken to have been contemplated by the parties as a possible

result in the event of breach of the contract. The loss

complained of must be immediately flowing out of the breach

of the said contract and not merely a loss which is remotely

connected with the contract itself or which cannot be

foreseen or contemplated by the parties. The present case is a

clear depiction of a case where the respondent-bank could not

have contemplated that the non-payment of the retiral dues

within the said period of 45 days could have resulted in the

cancellation of the alleged sale of the plot between the

appellant and the seller of the same. The compensation to the

appellant, therefore, cannot be given for such a remote and

indirect loss even if the same was suffered by him for the non-

payment of the retiral dues by the respondent-bank within the

specified period of 45 days. The appellant had entered into

the sale transaction at his own peril and his failure for not

paying the balance sale consideration amount towards the

said plot/property cannot in any manner be attributed to the

respondent-bank. The learned trial court has already granted

a sum of Rs.5,000/- as damages in favour of the appellant and

against the respondent-bank, despite the fact that the amount

of interest for a period of 20 days @ 5% was calculated as

just Rs.815/-. The remaining amount has been awarded by the

learned trial court towards mental agony suffered by the

appellant due to the said delay caused by the respondent-

bank in the release of the final amount of retiral dues.

10. In the light of the above, I do not find any infirmity,

illegality or perversity in the impugned judgment and decree

passed by the learned trial court and the same is therefore

accordingly upheld by this Court.

11. There is no merit in the present appeal and the

same is hereby dismissed.

February, 10 2011           KAILASH GAMBHIR, J
dc