Delhi High Court
Vijay Bhushan Arora vs Dipak Arora & Ors on 15 December, 2015
Author: Manmohan Singh
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Order delivered on: 15th December, 2015
+ I.A. No.3079/2013 in CS (OS) No.1013/2012
VIJAY BHUSHAN ARORA ..... Plaintiff
Through Ms.Meenakshi Arora, Sr.Adv. with
Ms.Mala Narayan & Ms.Vridhika
Mayar, Advs.
versus
DIPAK ARORA & ORS ..... Defendants
Through Nemo
CORAM:
HON'BLE MR.JUSTICE MANMOHAN SINGH
MANMOHAN SINGH, J.
1. The plaintiff has filed the suit for mandatory and perpetual
injunctions and for recovery of the sum of Rs.42,75,000/- along with
pendent lite and future interest.
2. By way of this order, I propose to decide the pending application
under Order XII Rule 6 filed by the plaintiff on the basis of the
admissions made by the defendant Nos.1 and 2 in
their written statement and other documents i.e. Agreement and
Memorandum of Understanding executed between the
parties.
3. The plaintiff is the eldest brother of the defendant Nos.1 and 3
and the defendant No.2 is the wife of defendant No.1, who is the
youngest brother of the plaintiff. No relief is being sought against
defendant No.3 and he is being impleaded only as a proforma
defendant.
Facts as per the Plaint
4. Admittedly, Late Sh.K.N.Arora and his wife Smt.Raj Kumari
Arora, the deceased parents of the plaintiff and the defendant Nos.1
and 3, had jointly purchased a plot of land admeasuring 296 sq. yds.,
bearing Municipal No.S-335, Greater Kailash-II, New Delhi-110048
from M/s DLF United Ltd. vide a duly registered sale deed dated 23 rd
October, 1972, registered as Document No.6899 in Addl. Book No.I,
Vol. No.3006 on pages 59 to 60 on the 25 th day of October, 1972 by
the Sub-Registrar Assurances, Asaf Ali Road, New Delhi.
Thereafter, the deceased parents of the plaintiff and the
defendant Nos.1 and 3 had constructed the ground floor, first floor and
second floor on the said property bearing No.S-335, Greater Kailash-
II, New Delhi-110048 (hereinafter referred to as the 'suit property',
which also comprises of open areas).
4.1 Late Shri. K.N.Arora, the father of the plaintiff and defendant
Nos.1 and 3 expired intestate on 13th April, 1998 leaving behind him
the following legal heirs:
a. Smt.Raj. Kumari Arora wife
b. Smt.Mohini Ahuja daughter
c. Sh.V.B. Arora son
d. Sh.A.K.Arora son
e. Sh.Dipak Arora son
4.2 After the death of their father, Late Sh.K.N. Arora, the plaintiff
and his brothers, who are the defendant Nos.1 and 3 relinquished their
entire shares in the suit property in favour of their mother, Smt.Raj
Kumari Arora, vide a Relinquishment Deed dated 24th April, 1989 duly
registered as document No.5198 in Addl. Book No.1, Vol. No.6443 on
pages 87 to 89 on 17th June, 1989. The sister of the plaintiff, namely,
Mrs. Mohini Ahuja, also relinquished her share in the suit property in
favour of her mother, Smt.Raj Kumari Arora, vide a relinquishment
deed duly registered as document No.7841 in Addl. Book No.I, Vol.
No.6530 on 29th September, 1989.
4.3 By virtue of the aforesaid relinquishment deeds, the mother of
the plaintiff and defendant Nos.1 and 3, namely, Smt.Raj Kumari
Arora, who was already the half owner of the said suit property,
became the sole, absolute and exclusive owner of the entire suit
property.
4.4 Smt.Raj Kumari Arora, vide a Will dated 2nd June, 1998, duly
registered as document No.4483 in Additional Book No.III, Vol. 75 at
pages 103 to 105 on 2nd June, 1998, while recording the execution of
the gift deed dated 4th June, 1993 gifting the entire ground floor of the
suit property in favour of the plaintiff, bequeathed the entire first floor
along with undivided interest in the land underneath the building of
the said property in favour of the defendant No.3 and further
bequeathed the entire second floor along with undivided interest in the
land underneath the suit property to the defendant Nos.1 and 2.
4.5 The mother of the plaintiff and the defendant Nos.1 and 3,
namely, Smt.Raj Kumari Arora, passed away on 8th August, 1999 and
as per the terms of the gift deed dated 4th June, 1993 and her Will
dated 2nd June, 1998 all the parties hereto became the owners having
interests in their respective portions gifted and/or bequeathed to
them.
4.6 It is the case of the plaintiff that as the previous sale deed was a
sham transaction made only with the purpose that the defendant
Nos.1 and 2 may be able to avail loans from banks in order to tide
over their financial problems, the said sham transaction was not even
mentioned in the said Will. The said transaction being without
consideration, was null and void and of no consequence.
4.7 The suit property is admittedly an old construction badly in need
of extensive repairs, all the parties hereto agreed to re-
develop/reconstruct the suit property for their personal use after
demolishing the existing old structure erected thereon.
After several meetings were held between all the parties and
their advocates, it was agreed between all the parties that after
demolition of the old construction a new building would be constructed
on the suit land and since no other party had the financial resources
for the said construction activities, it was agreed that the plaintiff
would be solely responsible for the demolition of the existing structure
and for construction activities, it was agreed that the plaintiff would be
solely responsible for the demolition of the existing structure and for
construction of a new building comprising of stilt parking, ground floor,
first floor, second floor and third floor entirely at his own costs and
expenses. It was also agreed that in consideration of the plaintiff
bearing all the expenses pertaining to the aforestated demolition and
construction activities including that of engaging architects,
contractors, getting the building plans prepared and sanctioned, etc.
to the entire exclusion of all the other parties, the plaintiff, besides his
own ground floor, shall also be entitled to the exclusive ownership of
the newly constructed third floor along with terrace rights and that if
the plaintiff so desired he would also be entitled to construct for
himself a basement in the suit property which would also vest in him.
It was agreed that the plaintiff shall also pay the sum of
Rs.50,00,000/- only to the defendant Nos.1 and 2 on the one part and
another sum of Rs.50,00,000/- to the defendant No.3 against
acquiring ownership rights on the third floor along with terrace rights.
It was further agreed that in case the plaintiff decided to construct for
himself the basement floor he shall additionally pay the sum of
Rs.5,00,000/- to the defendant Nos.1 and 2 on the one part and
another sum of Rs.5,00,000/- to the defendant No.3.
4.8 It was finally decided and agreed by all the parties that the
plaintiff shall pay the sum of Rs.10,00,000/- to the defendant Nos.1
and 2 on the one part at the time when they hand over vacant
possession of the second floor of the suit property to the plaintiff and
another sum of Rs.10,00,000/- to the defendant No.3 when he hands
over vacant possession of the first floor of the suit property to the
plaintiff for the purpose of demolition and reconstruction of the said
suit property. Another sum of Rs.10,00,000/- was agreed to be paid
to the defendant Nos.1 and 2 collectively as also the sum of
Rs.10,00,000/- was agreed to be paid to the defendant No.3 at the
time of completion of construction of structure. Finally, the sum of
Rs.30,00,000/- was agreed to be paid to the defendants Nos.1 and 2
on the one part and the defendant No.3 on the other part at the time
of execution and registration of documents conferring title /ownership
in favour of the plaintiff of the third floor and terrace.
4.9 Before the said terms could be recorded in writing the defendant
No.1 disclosed to the plaintiff the fact that he had taken a personal
loan from the Punjab National Bank which had to be urgently paid off
by him and requested for release of funds to the tune of Rs.10 lac
urgently to him. As alleged it disclosed to the plaintiff that the said
Bank had threatened that in case he fails to pay the money, the Bank
shall force the defendant No.1 to sell the second floor of the suit
property and that the Punjab National Bank had threatened to take
legal action against the defendant No.1. It was also later on disclosed
by the defendant Nos.1 and 2 that they had availed yet another loan
from the State Bank of Hyderabad against mortgage of the second
floor with the said Bank. However, the defendant Nos.1 and 2 agreed
that they shall be solely responsible for either foreclosing the said loan
on their own or taking a 'No Objection' from the said State Bank of
Hyderabad for carrying out the aforestated demolition and
reconstruction activities prior to handing over of possession of their
second floor to the plaintiff. Hence, in order to bail the defendant
Nos.1 and 2 out of a difficult situation the plaintiff agreed to advance
the sum of Rs.10 lac to them. The plaintiff immediately handed
over/advanced the sum of Rs.1.80 lac to the defendant No.1 vide
cheque No.196056 dated 20th May, 2011 drawn on HDFC Bank to be
given to the Punjab National Bank in order to avoid any coercive action
as threatened by the said Bank.
4.10 The parties hereto thereafter entered into and duly signed and
executed an agreement/Memorandum of Understanding on 31st May,
2011 detailing all the terms agreed by and between them.
The terms agreed between the parties hereto are as under:-
"1. That the parties hereto have agreed to getting the
said property re-developed / re-constructed after demolition
of the existing structure.
2. That the parties hereto agree that after the
demolition of the existing structure a new building be
constructed on the said property, comprising of Stilt
Parking, Ground Floor, First Floor, Second Floor, Third Floor
and Terrace.
3. That the First Party undertakes that it shall be his
sole responsibility to demolish the existing structure on the
said property and develop, construct, and/or build a
building consisting of Stilt Parking, Ground Floor, First
Floor, Second Floor, and Third Floor with terrace, at its
own costs and expense, after getting the building plans
sanctioned from the authorities concerned, in accordance
with the provisions of Master Plan, 2021.
That the First Party will install a Lift in the said
building for the common use of the Owners/Occupants of
the Stilt, Ground Floor, First Floor, Second Floor and Third
Floor of the said building. Permission, if obtainable, for
operating this lift will be taken by the First Party from the
statutory authority.
4. That the First Party shall develop, construct and
complete the building, after procuring the requisite
permission, sanctions and approvals for development /
construction and completion of the building on the said
property, at his own cost and expenses.
6. That after obtaining the approval of the Second
Party, Third Party and Fourth Party, the First Party shall
get, the building plans sanctioned from the concerned
authorities.
10. That the Second Party, Third Party and Fourth Party,
in accordance with the terms and conditions herein
recorded, shall place at the complete disposal of the First
Party, the vacant physical possession of the said property
and from the date thereof, the possession of the said
property shall irrevocably, vest in the First Party, with all
the powers and authorities of the First Party as may be
considered necessary by the First Party for obtaining the
requisite permissions, sanctions from the concerned
authorities for demolition/ re-construction of the proposed
building.
11. That the Fourth Party undertakes that before the
handing over of the possession by him to the First Party he
shall get the mortgage on the Second Floor redeemed at his
own cost and expenses. The Fourth Party shall be solely
responsible for completing all the formalities for getting the
property cleared from the mortgage with the State Bank of
Hyderabad, Delhi. In the alternative, it shall be open to the
Fourth Party to obtain a No Objection Certificate from State
Bank of Hyderabad, Delhi, to which it has mortgaged the.
Second. Floor of the said property, for demolition of the
existing structure and reconstruction of the same as per the
terms of the present agreement.
16. That the share of the parties in the building
constructed by the First Party on the said property, shall be
as under:
FIRST PARTY: Entire Ground Floor as well as
25% share in the Stilt Parking
and 25% share in the land
underneath the building,
alongwith common use of Lift,
Passages, and other common
areas.
AND
Entire Third Floor with Roof
Rights as well as 25% share in
the Stilt Parking and 25% share
in the land underneath the
building, alongwith common use
of Lift, Passages, and other
common areas.
SECOND PARTY Entire First Floor
as well as 25% share in the Stilt
Parking and 25% share in the
land underneath the building,
alongwith common use of Lift,
Passages, and other common
areas.
THIRD PARTY
AND FOURTH PARTY
COLLECTIVELY: Entire Second
Floor as well as 25% share in
the Stilt Parking and 25% share
in the land underneath the
building, alongwith common use
of Lift, Passages, and other
common areas.
17. That upon completion of the said building, the First
Party shall hand over the possession of the allocation of the
other parties in the said building to them respectively.
18. That the First Party undertakes to pay an amount of
Rs.50,00,000/- (Rupees Fifty Lacs Only) each to the Second
Party on one hand and to the Third Party and the Fourth
Party collectively, on the other hand. The said amount shall
be deemed to be the consideration for the entire Third Floor
with Roof Rights.
It is agreed and understood between the parties that the
aforesaid amount shall be paid by the First Party to the
Second Party on one hand and to Third Party and Fourth
Party on the other hand, in the manner described in
SCHEDULE B annexed herewith.
19. That the First Party, if so desires shall be at liberty
to construct a basement in the said property. If the First
Party wishes to construct a basement in the said property,
the entire expenses for the same shall be borne by the First
Party alone.
If the said basement is constructed by the First Party,
the same shall absolutely belong to and vest in the First
Party alone. However, the First Party shall pay an amount of
Rs.5,00,000/- (Rupees Five Lacs Only) each to the Second
Party on one hand and to the Third Party and the Fourth
Party collectively, on the other hand. The said amount shall
be deemed to be the consideration for the entire Basement.
20. That the Second Party, Third Party and the Fourth
Party undertake to execute all necessary documents of title
in favour of the First Party so as to give effect to the terms
of the present agreement. The First Party shall bear all the
expenses for the execution and registration of the said
documents.
25. The parties agr ee that the present
Memorandum of Understanding is irrevocable and
the terms of the same can be varied only by mutual
consent of all the parties hereto.
26. That the parties agree that they shall remain bound
by their respective rights and obligation under the present
Memorandum of Understanding during its subsistence."
SCHEDULE B
TERMS OF PAYMENT
The First Party shall pay the amounts to the Second
Party, Third Party and Fourth Party in the following manner:
Stage of Construction Amount to be paid
At the time of handing over of Rs.10,00,000/- to the
possession by the second second party.
party, third party and fourth
party.
AND
Rs.10,00,000/- to the
third party and fourth
party collectively.
On the completion of the Rs.10,00,000/- to the
structure of the building over second party.
the said property.
AND
Rs.10,00,000/- to the
third party and fourth
party collectively.
On execution/registration of Rs.30,00,000/- to the
the necessary documents of second party.
title by the second party, third
party and fourth party in
favour of the first party.
AND
Rs.30,00,000/- to the
third and fourth party
collectively.
A copy of the Memorandum of Understanding (MOU) dated 31st
May, 2011 has been placed on record.
4.11 The plaintiff alleges that even though the plaintiff was not
required to pay any amount whatsoever to the defendant Nos.1 and 2
till the vacation and handing over of vacant possession of the second
floor premises by the defendant Nos.1 and 2 to the plaintiff upon their
foreclosing the loan or obtaining an NOC from the State Bank of
Hyderabad as per the agreement reached between the parties,
however, in order to help out his youngest brother the plaintiff
advanced the sum of Rs.10,00,000/- to the defendant Nos.2 and 3 as
under:
Cheque No. Date Amount Bank
196056 20.5.2011 Rs.1,80,000/- HDFC Bank
196059 1.6.2011 Rs.3,20,000/- HDFC Bank
196061 17.6.2011 Rs.5,00,000/- HDFC Bank
4.12 It is alleged that the plaintiff in fact had made the said
payments only to help his younger brother and to bail him out of a
difficult situation with the Bank although the plaintiff was required to
make this payment only upon being handed over the vacant
possession of the second floor by the defendant Nos.1 and 2.
4.13 Despite receiving the aforestated amount of Rs.10 lac from the
plaintiff which the latter was not required to pay till he was handed
over vacant possession of the second floor, the defendant Nos.1 and 2
kept on pressurizing the plaintiff to give to them more and more funds
while failing to give any date when they would be vacating second
floor of the suit premises. It was represented by them that they are all
packed up but needed money to pay to the landlords whose premises
they shall be taking on rent.
4.14 In the meantime the building plans were prepared by the
architect in consultation with and active participation of all the parties
hereto who also got the same altered to suit their own specific
requirements. The parties appended their signatures only upon being
fully satisfied with the plans. As the building plans were anticipated to
be sanctioned soon, the plaintiff, on 21st September, 2011, gave a
notice to vacate the suit premises on or before 30 th October, 2011 so
that the construction activities could commence as per the agreement.
4.15 By early October, 2011 the building plans were sanctioned by
the Municipal Corporation of Delhi and all the other permissions and
approvals had also been obtained by the plaintiff who had by then,
incurred a lot of expense on the hiring of architect, contractor,
preparation and sanction of plans and obtaining the other approvals
and permissions. As per the terms of the agreement, in order to
commence the construction activities, the plaintiff took premises on
rent with a lock in period of fourteen months, to reside there during
the construction period and vacated and moved out of the ground floor
of the suit premises on 24th October, 2011. Similarly the defendant
No.3 also vacated and handed over the possession of the first floor of
the suit property on 31st October, 2011 and moved into a rented
accommodation.
4.16 It is averred by the plaintiff that the defendant Nos.1 and 2 also
once again represented to the plaintiff that they had packed up all
their belongings and were ready to vacate and hand over possession
of the second floor of the suit property. However, as they did not have
Rs.2,00,000/- to pay as advance to the landlord from whom they were
hiring the premises to shift into during the construction period, they
were unable to vacate. Once again even though the plaintiff had
already paid Rs.10 lac to the defendant Nos.1 and 2 despite not being
liable to pay any money to the defendant Nos.1 and 2 before they
vacated the premises, however, in order to help out his brother and
sister in law, the plaintiff once again gave in to the demands of the
defendant Nos.1 and 2 and advanced to them the sum of
Rs.2,00,000/- vide cheque No.349487 dated 15th October, 2011 drawn
on HDFC Bank. A certificate issued by the HDFC Bank certifying the
encashment of all the cheques mentioned hereinabove vide which the
total payment of Rs.12,00,000/- was made to the Defendant Nos.1
and 2 has been annexed as Annexure D.
4.17 However, the defendants Nos.1 and 2, instead of vacating and
handing over the vacant possession of the second floor to the plaintiff,
once again raised another demand to the effect that the plaintiff clears
their entire loan outstanding amounting to Rs.31,00,000/- with the
State Bank of Hyderabad. They expressed their inability to either clear
their loan themselves or to obtain an NOC from the said Bank for
carrying out the demolition and reconstruction activity on the said
property. Another demand for the release of a further sum of
Rs.3,00,000/- only over and above the said demand was also raised on
the pretext that this amount was needed to pay for the rentals of the
place that the said defendant Nos.1 and 2 intended to shift into and
also for sustenance. The plaintiff who had earlier already paid the sum
of Rs.2,00,000/- only for the same purpose of payment to the landlord
was shocked to receive yet another demand for the same purpose and
he realized that his youngest brother and sister-in-law were only
interested in making capital out of the situation by extracting as much
money as they could from their elder brother, who had already made
huge investments on the said project and who had also shifted into
another rented residence.
4.18 It is alleged by the plaintiff that once again on the request of the
family the plaintiff was prevailed upon to agree to assist the defendant
Nos.1 and 2 in foreclosing the loan / mortgage taken by them from the
State Bank of Hyderabad and the plaintiff agreed to advance another
sum of Rs.28,00,000/-. However, looking at their past conduct, the
plaintiff insisted that he would pay the said amount directly to the Bank
although the defendant No.1 kept on insisting that this amount be paid
to him and then he would negotiate with the Bank for an NOC and
continue to pay the EMIs to the Bank. It is also pertinent to mention
herein that far from making any program for vacating the premises the
defendant Nos.1 and 2 had, on the contrary, by this time, applied for
and obtained a new water connection which clearly showed that they
had no intention of moving out. Despite the plaintiff was prepared to
hand over Rs.28 lac directly to the Bank, the defendant Nos.1 and 2
then demanded a further sum of Rs.3,00,000/- to be handed over to
them on the pretext that the said amount was to be paid towards
rentals for the premises that they proposed to take on rent. This
demand was made despite the fact that already a sum of Rs.2 lac had
been advanced by the plaintiff for giving to the landlord even though as
per the terms of the agreement he was not required to advance the
said sum.
4.19 As the defendants Nos.1 and 2 had yet neither foreclosed the
loan nor vacated the second floor premises, the plaintiff was not liable
to make any payments whatsoever to the said defendants. Since
making the payment of a further sum of Rs.28 lac would have
tantamounted to a material and substantial change in the payment
terms incorporated in the MOU and as the plaintiff would be
paying/advancing the sum of Rs.40 lac as against the total amount of
Rs.50 lac payable to the defendant Nos.1 and 2 upon the completion of
the project and upon their executing the title documents in favour of
the plaintiff of the newly constructed floors, the plaintiff sent an
amended agreement incorporating the change in terms necessitated by
the said developments for the signature of the defendant Nos.1 and 2
where, in order to safeguard the interests of the plaintiff and to ensure
compliance of the MOU by the defendant Nos.1 and 2, it was clearly
mentioned that the said defendants would not demand possession of
the second floor till such time that they executed and registered
documents conferring title of the third floor and. terrace as also the
basement, if constructed, upon the plaintiff.
4.20 As per the terms of the MOU the total amount of Rs.50 lac would
have become payable only upon the execution of the title documents in
favour of the plaintiff. Further looking at the conduct of the defendant
Nos.1 and 2 it had become obvious to the plaintiff that they would try
to extract more money from the plaintiff for executing the said
documents by raising frivolous objections. When the agreement
incorporating the said changes was sent to the defendant Nos.1 and 2,
they started raising objections to the said amended agreement. As the
defendant Nos.1 and 2 were neither vacating the second floor of the
suit premises nor agreeing to sign the agreement incorporating the
change in the payment schedule and subsequent events necessitating
changes in some of the terms of the MOU. Upon the suggestion of the
family members, a new amended agreement incorporating some
changes desired by the defendant Nos.1 and 2 was sent to the said
defendants along with a letter on 24th January, 2012.
4.21 In the letter, the plaintiff had clearly mentioned that he had till
that date already spent a sum of Rs.42,75,000/- towards expenses
incurred on the said project as under :-
Nupur Arora Rs.12,00,000/-
A.K.Arora Rs.5,00,000/-
Architect Rs.2,00,000/-
MCD Approvals Rs.10,68,384/-
House Rentals for lock in period Rs.8,40,000/-
Security paid to landlord Rs.1,80,000/-
Brokerage/registration of lease deed Rs.44,000/-
Expenses on shifting of residence Rs.67,800/-
Legal expenses Rs.52,000/-
Miscellaneous Rs.1,23,000/-
Total Rs.42,75,000/-
5. The plaintiff was left with no option but to file the present suit.
6. During the pendency of the suit, the plaintiff had filed an
application being I.A. No.13079/2013 under Order XII Rule 6 read with
Section 151 CPC on the basis of admissions as alleged by the plaintiff.
7. It is mentioned in the application that the defendant Nos. 1 and
2 in their written statement have admitted that they have
signed/executed the agreement dated 31st May, 2011 as per the terms
of which the plaintiff had agreed to redevelop the suit property after
demolishing the same at his own cost and expense and in
consideration of the same the parties had agreed that the additional
floor to be built by the plaintiff shall belong to him and the plaintiff had
agreed to pay the sum of Rs.50,00,000/- to the defendant Nos.1 and 2
on the one part and another sum of Rs.50,00,000/- to the defendant
No.3 on the other part.
8. The defendants have stated in their written statement that the
true and correct facts are that it was agreed that the consideration for
the plaintiff being allowed to build an additional floor on the suit
property along with terrace rights was that he would bear all the
expenses relating to the demolition, construction, including that of
engaging architects, contractors, getting the building plans prepared
and sanctioned, etc. along with a sum of Rs.50,00,000/- only which
was to be paid each to the defendant Nos. 1 and 2 on the one part and
defendant No.3 on the other part. It was agreed that the plaintiff
besides his own ground floor, shall also be entitled to the exclusive
ownership of the newly constructed Third Floor along with terrace
rights and if the plaintiff as against a consideration of the plaintiff
having to bear all the costs relating to the demolition and
reconstruction and an amount of Rs.50,00,000/- to be paid each to the
defendant Nos.1 and 2 on the one part and the defendant No.3 on the
other part. It was also agreed that the plaintiff would be allowed to
build a basement for himself in the proposed construction of the suit
property which would vest in him as against a further payment and
consideration of Rs.5,00,000/- which was to be paid each to the
defendant Nos. 1 and 2 on the one part and defendant No.3 on the
other part."
9. The agreement/MOU dated 31st May, 2011 as well as the terms
thereof have been admitted by the defendant Nos.1 and 2 and some of
the terms have even been reproduced by the said defendants in their
written statement. It is the case of the plaintiff that he has incurred
huge expenses while complying with the terms of the said agreement
and he is claiming damages from the defendants on account of the
same.
10. It is not denied by the defendant Nos.1 and 2 that they had
executed the said MOU / agreement but they were unable to vacate
the second floor on account of the bank loan that they had taken
rather it is alleged by them that the plaintiff had agreed to clear their
loan with the bank and that based on the said alleged assurance of the
plaintiff, the defendants had entered into the said agreement.
However, the terms of the agreement speak otherwise. It may be
pointed out that as per Sections 91 and 92 of the Evidence Act, 1872 a
written agreement and the terms thereof do not require any evidence
to be proved and that no oral evidence or oral agreement can be
admitted to contradict, vary, add or modify the said written
agreement.
11. It is the case of the defendant Nos.1 and 2 that they did not
comply with the terms of the MOU/agreement dated 31st May, 2011 as
they could not vacate the second floor since the same was mortgaged
with the Bank. The defendant Nos.1 and 2 in their written statement
have stated that "infact, the defendant Nos.1 and 2 asked the plaintiff
to make the balance payment of atleast the outstanding Bank Loan
immediately so that they could pay off the Bank and get the title
documents released. The defendants Nos.1 and 2 could not have
moved out of the premises of the second floor without having paid off
the Bank because no demolition activity of subsequent construction
thereupon could have taken place on the suit property without the
Bank being paid off and the NOC obtained from the Bank." It has been
further submitted by the said defendants in their written statement
that "the amount of Rs.2 lac was paid but the plaintiff did not pay the
balance amount of Rs.28 lac which the defendants would have
received and would have cleared the Bank Loan and then move out
from the second floor." The defendants have also submitted that "the
defendants No.1 and 2 would have vacated the premises if the plaintiff
would have made the payment of the entire amount of Rs.28 lac in
order to clear the outstanding Bank Loan."
12. It is the case of the plaintiff as stated in para 27 of the plaint
that he had been "prevailed upon to agree to assist the defendant
Nos.1 and 2 in foreclosing the loan/mortgage taken by them from the
State Bank of Hyderabad and the plaintiff agreed to advance another
sum of Rs.28,00,000/-. However, the plaintiff has stated that he had
agreed to pay off the said amount directly to the Bank directly
provided his interests were safeguarded and the defendant Nos.1 and
2 executed the sale /title deeds pertaining to the third floor and the
basement in his favour prior to handing over of possession of the
second floor to the defendant Nos.1 and 2.
13. The defendant Nos.1 and 2 in their written statement have now
stated that they are agreeable to executing the title deeds when the
super structure of the building is complete.
14. In reply to the application filed by defendant Nos.1 and 2, it is
admitted that the amount received by them from the plaintiff has been
forfeited by the said defendants and nothing is due. There is no
admission of liability. The present application under Order XII Rule 6
CPC is not maintainable.
15. As far as the payment made by the plaintiff to defendant Nos. 1
and 2 of Rs.12,00,000/- is concerned, the same has not been denied
by them. The plea of the defendant Nos. 1 and 2 for forfeiting the
amount received has no force in view of the admitted facts in the
matter.
16. The plaintiff at the same time is also seeking the relief of
recovering of Rs.27,75,000/- which is allegedly spent by him towards
expenses incurred on the object as per details given in para 31 of the
plaint.
The above said amount spent by the plaintiff is a disputed
question of fact and the plaintiff has to prove the same in trial. But as
far as the making payment of Rs.12,00,000/- is concerned, the same
is undisputed fact which cannot be denied by the defendant Nos. 1 and
2.
17. Having gone through the plaint, written statement and the
averments made in the application, prima-facie, I am of the
considered view that it is the defendant Nos.1 and 2 who are in
violation of the MOU arrived at between the parties. Defendant Nos.1
and 2 now in the written statement have taken the contrary stand to
some extent to the MOU arrived at between them. The MOU has not
been denied by them, rather there are admissions made by the
defendant Nos.1 and 2 in their written statement. Defendant Nos.1
and 2 have not denied that they have received Rs.12 lac from the
plaintiff. Actually, as observed, they are in violation of the terms of
the MOU. Therefore, they cannot forfeit the said amount, in view of
merely reading the terms and conditions of the MOU. They cannot
raise the pleas which are contrary to the terms and conditions of the
written agreement between the parties.
18. The law in deciding the application under Order XII Rule 6 is
quite settled. In Uttam Singh Duggal & Co. Ltd. vs. United Bank
of India, (2000) 7 SCC 120, it has been held as follows:
"In the objects and reasons set out while amending the
said rule, it is stated that "where a claim is admitted,
the court has jurisdiction to enter a judgment for the
plaintiff and to pass a decree on admitted claim. The
object of the Rule is to enable the party to obtain a
speedy judgment at least to the extent of the relief to
which according to the admission of the defendant, the
plaintiff is entitled." We should not unduly narrow down
the meaning of this Rule as the object is to enable a
party to obtain speedy judgment. Where other party
has made a plain admission entitling the former to
succeed, it should apply and also wherever there is a
clear admission of facts in the face of which, it is
impossible for the party making such admission to
succeed."
19. This Court in the case of Zulfiquar Ali Khan (dead) through
LRs and Ors. vs. Straw Products Limited & Ors.,2000 (56) DRJ
590 in para 10 observed as under:
"10. This is a notorious fact that to drag the case, a
person so interested often takes all sorts of false or legally
untenable pleas. Legal process should not be allowed to be
misused by such persons. Only such defense as give rise to
clear and bona fide dispute or triable issues should be put to
trial and not illusory or unnecessary or mala fide based on
false or un- tenable pleas to delay the suit. The issues will
be framed in a suit only when pleadings raise material
proposition of law and/or fact which need investigation and
so could be decided after trial giving parties opportunities to
adduce such relevant evidence as they may think necessary
and proper. Material proposition of law or fact would mean
such issues which are relevant and necessarily arise for
deciding the controversy involved. If a plea is not valid and
tenable in law or is not relevant or necessary for deciding
the controversy involved, the Court would not be bound and
justified in framing issue on such unnecessary or baseless
pleas, thereby causing unnecessary and avoidable
inconvenience to the parties and waste of valuable court
time."
It is a rule of law of evidence, which is also known as the "best
evidence rule" that in case a written document is available, no oral
evidence can be lead in that regard. In the present case, in the face of
a document in writing, the pleas of the defendant cannot be permitted
to be taken and are barred by the provision of Section 92 of the
Evidence Act. The following cases are relevant in this regard:
(a) In M/s. Kusum Enterprises and ORs.Vs. Vimal Kochhar
and Anr. 207(2014)DLT172, it was observed as follows:
"(c) Section 91 of the Indian Evidence Act, 1872 provides
that where the terms of a contract have been reduced in
the form of a document and where the matter is required
by law to be reduced in the form of a document, no
evidence shall be given in proof of the terms of such
contract except the document itself; Section 92 of the
Evidence Act provides that where the terms of the
contract required by law to be reduced in the form of a
document have been proved according to Section 91, no
evidence of any oral agreement between the parties for
the purpose of contradicting, varying, adding to, or
subtracting from its terms shall be admitted; though
there are exceptions to both the said provisions but the
same have not been invoked by the respondents/plaintiffs
or their counsel and the case is not found to be falling in
any of the exceptions;
(d) it is also the settled position in law (See Chandrakant
Shankarrao Machale Vs. Parubai Bhairu Mohite (2008) 6
SCC 745 and S. Saktivel Vs. M. Venugopal Pillai (2000) 7
SCC 104) that the terms of a registered document can be
varied/altered by a registered document only; in Raval &
Co. Vs. K.G. Ramachandran (1974) 1 SCC 424 it was
specifically held that any variation of rent reserved by a
registered lease deed must be made by another
registered instrument."
(b) In the case of Roop Kumar v. Mohan Thedani (2003) 6 SCC
595, it was held as follows:
"Section 91 relates to evidence of terms of contract,
grants and other disposition of properties reduced to form
of document. This section merely forbids proving the
contents of a writing otherwise than by writing itself; it is
covered by the ordinary rule of law of evidence, applicable
not merely to solemn writings of the sort named but to
others known some times as the "best evidence rule". It
is in really declaring a doctrine of the substantive law,
namely, in the case of a written contract, that of all
proceedings and contemporaneous oral expressions of the
thing are merged in the writing or displaced by it. (See
Thaver's Preliminary Law on Evidence p. 397 and p. 398;
Phipson Evidence 7th Edn. p. 546; Wigmore's Evidence p.
2406.) It has been best described by Wigmore stating
that the rule is no sense a rule of evidence but a rule of
substantive law. It does not exclude certain data because
they are for one or another reason untrustworthy or
undesirable means of evidencing some fact to be proved.
It does not concern a probative mental process - the
process of believing one fact on the faith of another. What
the rule does is to declare that certain kinds of facts are
legally ineffective in the substantive law; and this of
course (like any other ruling of substantive law) results in
forbidding the fact to be proved at all. But this prohibition
of providing it is merely the dramatic aspect of the
process of applying the rule of substantive law. When a
thing is not to be proved at all the rule of prohibition does
not become a rule of evidence merely because it comes
into pay when the counsel offers to "prove" it or "give
evidence" of it; otherwise any rule of law whatever might
reduced to a rule of evidence. It would become the
legitimate progeny of the law of evidence. For the
purpose of specific varieties of jural effects - sale,
contract etc. there are specific requirements varying
according to the subject."
20. In view of the above said facts and circumstances of the case, it
is clear that the admissions are made by defendant Nos.1 and 2
admitting the agreement and the terms contained therein as well as
non-compliance by them. They have also received Rs.12 lac from the
plaintiff. The suit of the plaintiff is partly decreed for a sum of Rs.12
lac along with interest @ 18% per annum from the date of payment till
the date of realization by defendant Nos.1 and 2. Decree be drawn
accordingly. It is clarified that as far as the remaining amount claimed
by the plaintiff, the details of which are given in the plaint, is
concerned, the suit shall continue.
21. If the defendant Nos.1 and 2 shall give an undertaking by way of
affidavit within 4 weeks to the effect that they are still interested and
ready to comply with all the terms and conditions of the MOU, the
liberty is granted to them to move an application for settlement within
the stipulated period, then the appropriate order would be passed. In
failure to do so, the plaintiff would be entitled to recover the decreetal
amount in accordance with law to enforce the decree.
22. The application is accordingly disposed of.
CS(OS) No.1013/2012
23. List the suit before the Joint Registrar on 25th January, 2016 for
further proceedings.
24. As the valuation of the suit is even less than Rs.1 crores, in case
there is no settlement between the plaintiff and the defendant Nos. 1
and 2, an appropriate order to transfer the matter to a subordinate
Court would be passed accordingly.
(MANMOHAN SINGH)
JUDGE
DECEMBER 15, 2015
