Smt. Urmila Vohra & Anr vs M/S Janak Properties Pvt. Ltd. & ...
2018 Latest Caselaw 4963 Del

$~OS-7
*    IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                              Date of Decision: 23.08.2018

+     CS(OS) 325/2017

      SMT. URMILA VOHRA & ANR                 ..... Plaintiffs
                   Through  Mr.Sanjeev Bajaj, Adv.

                           versus

      M/S JANAK PROPERTIES PVT. LTD. & ORS ..... Defendants
                   Through   Mr.Ashish Kapur, Adv. with the
                   defendant

      CORAM:
      HON'BLE MR. JUSTICE JAYANT NATH

JAYANT NATH, J. (Oral)

IA Nos. 7955/2017 and 14248/2017

1. IA No. 7955/2017 is filed under Order 39 Rules 1 and 2 CPC.

2. This court had on 19.07.2017 passed an order directing that till the disposal of the application, the defendants will maintain status quo regarding the title and possession and will not create any third party interest in the suit property.

3. IA No. 14248/2017 has been filed by the defendants under Order 39 Rule 4 CPC seeking vacation of the interim order.

4. The present suit is filed for specific performance of an Agreement dated 24.01.2013 and Addendum dated 19.07.2014 in respect of the property No. 14-A/69, W.E.A., Karol Bagh, New Delhi-110005 or alternatively for recovery of Rs.2.50 crores. The plaintiffs are said to have

CS(OS)325/2017 Page 1 paid part consideration to the defendants in view of the Agreement to Sell and Addendum. As per the plaint, the parties had agreed for the sale of the aforenoted property at Rs.3.95 crores and Rs.25 lakhs was paid by the plaintiff in advance. An agreement was entered on 17.10.2012. Subsequently, a deed of cancellation was executed on 22.01.2013. Advance sum of Rs. 25 lakhs was also refunded to the plaintiff. Thereafter, the parties discussed a fresh proposal and on 24.01.2013, the parties entered into a fresh agreement to sell. Now, the agreed consideration was Rs. 3.61 croes. A sum of Rs.95 lakhs was paid in advance by the plaintiffs to the defendants. It is stated that the defendant was to deposit the original title deeds on acceptance of the said sum of Rs.95 lakhs. It is further stated in the plaint that the plaintiff received information that a person by the name Amarjeet Singh is having 100 shares in defendants' company. Further the defendants undertook to initiate eviction proceeding within 07 days of the execution of the agreement against Amarjeet Singh. The defendants also agreed to apply to DDA within 7 days for conversation of the suit property from leasehold to freehold. Later on, it was revealed that the defendants had concealed the fact that an MOU had been entered into on 16.07.2009 with one Mr.Prakash Nair and a sum of Rs.90 lakhs was accepted by the defendant from the said Prakash Nair. It was also revealed that the original title documents of the suit property had been handed over to the said Prakash Nair by the defendants. It was also revealed that Mr. Amarjeet Singh who held 100 shares in the defendant Company had also given a sum of Rs.20 lakhs as advance for purchase of the property from the defendants.

5. It is pleaded that based on these facts, an Addendum was executed to the agreement to sell dated 24.01.2013 on 19.07.2014. Another sum of Rs.10

CS(OS)325/2017 Page 2 lakhs was paid pursuant to the Addendum. The defendants undertook to transfer 1100 shares belonging to defendants No. 2 and 3 in favour of the plaintiff before 31.07.2014. It is further pleaded that the plaintiff has already paid a sum of Rs.2.50 crores out of the entire sale consideration but there is complete lack of will on the part of the defendants to comply with the terms and conditions of the agreement. It is pleaded that the plaintiffs have also borne miscellaneous expenses and legal charge which are supposed to be borne equally by the plaintiffs and the defendants. It is further stated that the plaintiffs are ready and willing to pay the balance sale consideration to the defendants and to complete the transaction.

6. I have heard learned counsel for the parties.

7. Learned counsel for the defendants has vehemently argued that in all a sum of Rs. 1.54 crores has been received by the defendants. He further submits that on payment of the balance sale consideration, the defendants are ready and willing to sell the property to the plaintiffs and register the necessary sale deed. Learned counsel appearing for the defendants also submits that the defendants are in the alternative also ready to refund the advance money received from the plaintiffs if they so desire.

8. Learned counsel for the plaintiffs has however made various submissions to insist that he has paid a sum higher than Rs.1.54 crores. It has also been pleaded that the property had to be converted into freehold which has not been done so far. It is thirdly pleaded relying upon para 6 of the Addendum, that a sum of Rs.72.80 lakhs has been given to the defendants as loan from the friends of the plaintiffs. Learned counsel for the plaintiffs submits that this amount has been repaid by him to his friends. Hence, he submits that the total payment received by the defendants is not

CS(OS)325/2017 Page 3 Rs.1.54 crores but much more. He fourthly submits that the plaintiffs have incurred legal expenses which are also to be reimbursed.

9. Learned counsel for the defendants has clarified that in case the plaintiffs have paid back the loan of his friends of Rs.72.80 lakhs taken by the defendants, the defendants would be taking this payment into account provided proper receipts are shown to the satisfaction of the defendants that payments have been made for the loan taken by the defendants to the friends of the plaintiffs.

10. In my opinion, there is no clarity in the stand of the plaintiffs. My said conclusion is reached on the following facts:

(i) Firstly admittedly, as per the agreement to sell dated 24.01.2013 out of the total sale consideration of Rs. 3.61crores, a sum of Rs.95 lakhs was paid to the defendants. Clause 2 of the agreement to sell clearly states so. Further as per the Addendum which was signed on 19.07.2014, a sum of Rs.1.34 crores has been paid by the plaintiffs to the defendants. Along with the Addendum, another sum of Rs. 20 lakhs was paid making a total payment of Rs.1.54 crores. Hence, as per the pleadings and the documents, a sum of Rs.1.54 crores has been paid to the defendants. However, the plaintiffs insist that as per Clause 6 of the Addendum, the plaintiffs have arranged a loan of Rs. 65 lakhs from their friends to the defendants. This loan amount including interest was on repayment to be Rs.72.80 lakhs. It is further stated that the plaintiffs have paid the said amount of Rs.72.80 lakhs on behalf of the defendants to their friends and this amount has to be deducted from the balance sale consideration payable.

(ii) I may only note that in the plaint there is no averment that the plaintiffs have paid Rs.72.80 lakhs to their friends who had given the loan to

CS(OS)325/2017 Page 4 the defendants. In fact in para 21 of the written statement the defendant has clearly said that a sum of Rs.1,54,00,000/- has been received as part payment by the defendant and a balance of Rs.2,07,00,000/- is still due and payable by the plaintiff. In the rejoinder filed there is no specific denial by the plaintiff to the said averment. However, learned counsel appearing for the defendants has very fairly stated that in case such a payment is made and the plaintiffs show the necessary receipts, the defendants would also take that into consideration while completing the transaction.

(iii) However, there is another hazy issue. As noted above, it appears that at best the plaintiffs have paid Rs.2,26,80,000/- to the defendants in terms of the agreement to sell dated 24.01.2013 and Addendum dated 19.07.2014. The plaintiffs insist as stated in the plaint that a sum of Rs.2.50 cores has been paid by them. Further, the plaintiffs stated that they are entitled to receive legal expenses. The plaint is silent as to how this figure of Rs.2.50 crores is arrived at. It has also not been explained in the course of arguments in court through documents as to how this figure of Rs.2.50 crores has been arrived at.

11. There is another bone of contention between the parties. This aspect is regarding conversion of the property to free hold. The stand of the defendant is that it was the responsibility of the plaintiff to get the property converted to freehold. However, it is pleaded that the plaintiff has failed to take steps to have the property converted to freehold. This aspect has been denied by learned counsel for the plaintiff. The plaintiffs blame the defendant for failing to convert the property to free hold. Clause 5 of the Agreement to Sell dated 24.01.2013 and Clause 5 and Clause 8 of the Addendum dated 19.07.2014 read as follows:-

CS(OS)325/2017 Page 5 "5. That the Seller shall after the execution of this agreement to sell and purchase, shall within 7(seven) days thereof, apply to DDA, for converting the said property into freehold. The process of the conversion of the property into freehold shall be done by the PURCHASERS at the cost of the SELLER. The SELLER shall Cooperate fully with the PURCHASERS for getting the said property converted into freehold and shall also sign all documents, present themselves before the appropriate authority as and when required and do all other acts necessary for conversion of the said property into free hold.

(Addendum)

5.That it is mutually agreed between the parties that on the said property being converted into freehold by the SELLER and the fulfilment of the above said conditions, the balance full and final payment after, deducting all expenses incurred by the Purchasers on behalf of , the Seller, will be made by the PURCHASERS to the SELLER on or before 28th February 2015, and the SALE DEED(S) shall be executed by the SELLER simultaneously on the same day of the full and final payment being made, i.e. on or before 28th February 2015. The SELLER shall also handover symbolic possession of the said property to the PURCHASERS immediately on receiving the full and final payment, in case the possession of the said property is still with Mr.Amarjeet Singh. In case there is any delay in the conversion of the property in question to freehold, in such a case, the balance full and final payment after deducting all the expenses incurred by the Purchasers on behalf of the Seller, will be made by the PURCHASERS to the SELLER within 60 days of the execution of conveyance deed/conversion of the said property into freehold." .....

8. That it is mutually agreed between the parties that on the said property being converted into freehold by the SELLER and the fulfilment of the above said conditions, the balance full and final payment will be made by the PURCHASERS to the SELLER as stipulated in clause 5 above and the SALE

CS(OS)325/2017 Page 6 DEED(S) shall be executed by the SELLER simultaneously on the same day of the full and final payment being made. The SELLER shall also handover symbolic possession of the said property to the PURCHASERS immediately on receiving the full and final payment, in case the possession of the said property is still with Mr. Amarjeet Singh."

12. As per the agreement to sell, the process of conversion of the property into freehold was to be done by the plaintiffs at the costs of the defendants. The defendants had to cooperate with the plaintiffs for getting the property converted into freehold. The above clauses of the Addendum, however seem to suggest that it would be the seller who has to get the property converted into freehold.

13. Learned counsel for the defendant has stated that de hors this controversy the defendant can execute a deed in favour of the plaintiff. He has further offered that appropriate conveyance deed can be executed in favour of the plaintiffs and he is ready and willing to have the conveyance deed executed provided the balance sale consideration is paid by the plaintiffs, namely, a sum of Rs.3.61 crores less a sum of Rs.1.54 crores already received by the defendants. It has further been stated that in case the plaintiffs have paid Rs.78.20 lakhs to their friends in lieu of repayment of the loan given to the defendants, the said amount may be added to the consideration received by the defendants. In the alternative, he submits that he is ready and willing to refund the entire sum of Rs.1.54 cores and Rs.72.80 lakhs in case payment has been made to the friends by the plaintiffs back. He has further pleaded that another way forward would be for the defendants No.2 and 3 to transfer their entire shareholding in defendant No.1 in favour of the plaintiff which would also enable control

CS(OS)325/2017 Page 7 over defendant No.1 company who owns the property.

14. I may note that in response to this offer learned counsel for the plaintiff was unable to take any stand. There was no denial of the fact that the defendant can execute the necessary conveyance deed in favour of the plaintiff or transfer the shares of the company defendant No.1 in favour of the plaintiff.

15. What follows from the above is that the defendant has made a fair offer to the plaintiff to either complete the transaction on payment of the balance unpaid sale consideration, On receipt of this balance consideration the defendant is ready to transfer the property in favour of the plaintiff in terms of the agreement. An alternative offer is made that the defendant is ready to refund to the plaintiff the entire advance received.

16. Keeping in view the above, in my opinion, the plaintiffs have failed to make out a prima facie case. From the stand of the defendant, it is clear that the defendant has shown that he is ready and willing to perform his part of contract. However, the facts as noted above show that prima facie the plaintiff is not ready and willing to perform his part of contract.

17. It is clear that the plaintiffs have failed to make out any case for grant of injunction. Balance of convenience is not in favour of the plaintiffs. Accordingly, I dismiss IA No. 7955/2017 and allow IA No. 14248/2017. The interim order of this court dated 19.07.2017 stands vacated.

18. However, in the interest of justice, I extend the interim order for a period of two months from today. It is left open to the plaintiffs to choose any of the two options given by the defendants, namely, to take back the payments made to the defendants i.e. Rs.1.54 crores plus Rs.72.80 lakhs on showing proper original receipts from the friends of the plaintiffs being a

CS(OS)325/2017 Page 8 total of Rs.2,26,80,000/-. In the alternative, the plaintiffs may pay the balance sale consideration as agreed upon in the Agreement to Sell dated 24.01.2013 and addendum dated 19.7.2014 subject to the defendants executing the necessary conveyance deed in favour of the plaintiff. Any other relief that the plaintiff wishes to press can be left open for adjudication in the main suit. In case, the plaintiffs choose any one of these two options, liberty is granted to the plaintiffs to move an appropriate application to the said effect.

19. The applications stand disposed of.

CS(OS) 325/2017 List on 30.11.2018.

                                                      JAYANT NATH, J
AUGUST 23, 2018
Rb/n
corrected and released on 06.09.2018




CS(OS)325/2017                                                            Page 9