Shri Tarsem Lal Bajaj vs Shri Gulshan Chawla
2018 Latest Caselaw 5761 Del

*            IN THE HIGH COURT OF DELHI AT NEW DELHI

+            RFA No.253/2017 and C.M. No.17914/2017 (under
             Order 41 Rule 27 CPC)

%                                             24th September, 2018

SHRI TARSEM LAL BAJAJ
                                                          ..... Appellant

                          Through:       Mr.    Narendra     Bhandari,
                                         Advocate (M. No.9313362890).
                          versus

SHRI GULSHAN CHAWLA
                                                        ..... Respondent

Through:

CORAM:

HON'BLE MR. JUSTICE VALMIKI J.MEHTA

To be referred to the Reporter or not?

VALMIKI J. MEHTA, J (ORAL)

1. This Regular First Appeal under Section 96 of the Code

of Civil Procedure, 1908 (CPC) is filed by the plaintiff in the suit

impugning the Judgment of the Trial Court dated 02.11.2016 by which

trial court has dismissed the suit for recovery of Rs. 68 lakhs filed by

the appellant/plaintiff/buyer against the respondent/defendant/seller.

The amount of Rs.68 lakhs which was claimed was on account of the

appellant/plaintiff claiming double the amount of Rs. 34 lakhs paid by

the appellant/plaintiff to the respondent/defendant under the

Agreement to Sell dated 13.06.2014.

2. Counsel for the appellant/plaintiff states that

appellant/plaintiff confines the relief in the present appeal for the

recovery of Rs. 34 lakhs as opposed to the claim in the suit for double

the amount of Rs. 34 lakhs at Rs. 68 lakhs, as this was the amount

which was paid by the appellant/plaintiff to the respondent/defendant

under the subject Agreement to Sell dated 13.06.2014.

3. It may be noted that the respondent/defendant did not

appear in the trial court and was proceeded exparte. No written

statement was filed by the respondent/defendant and no evidence has

been led by the respondent/defendant. The appellant/plaintiff led

evidence and proved the Agreement to Sell as Ex.PW1/1. The receipt

dated 12.12.2014 of appearance of the appellant/plaintiff before the

sub-Registrar for registration of the Sale Deed was proved as

Ex.PW1/4. The fact that the respondent/defendant was the owner in

terms of a Collaboration Agreement entered into by the

respondent/defendant with the owner Smt. Ish Rani has also been

deposed to by the appellant/plaintiff.

4. As to the entitlement of a seller of an immovable property

to forfeit the amount paid under an Agreement to sell, the law is now

well settled that even if a appellant/plaintiff is guilty of breach of

contract, yet, the seller/defendant cannot forfeit the amount paid under

an Agreement to sell unless the seller pleads and proves that loss has

been caused to him. In the present case, the respondent/defendant is

exparte, and therefore, there is no pleading or evidence that the

respondent/defendant has suffered loss on account of the alleged

breach of the Agreement to Sell by the appellant/plaintiff so that the

respondent/defendant can forfeit the amount of Rs. 34 lakhs paid

under the subject Agreement to Sell dated 13.06.2014/Ex.PW1/1.

This aspect that a seller cannot forfeit the amount paid under an

Agreement to Sell unless loss is pleaded and proved has been

discussed in detail in the judgment in the case of M.C. Luthra v.

Ashok Kumar Khanna 2018 (248) DLT 161. An SLP against the

judgment in the case of M.C. Luthra (supra) has been dismissed by

the Supreme Court on 15.05.2018 in S.L.P.(C) No.11702/2018.

Therefore, the law is what is held by the Constitution Bench judgment

of the Supreme Court in the case of Fateh Chand v. Balkishan Dass

AIR 1963 SC 1405 which has been interpreted in the recent judgment

of the Supreme Court in the case of Kailash Nath Associates v. Delhi

Development Authority and Another (2015) 4 SCC 136 which held

that a seller cannot forfeit the amount received under an Agreement to

Sell, besides a nominal amount, and such nominal amount can only be

forfeited in case the buyer is found guilty of breach of contract. In the

present appeal, loss is not pleaded or proved to be caused to the

respondent/defendant.

5. In view of the aforesaid discussion, this appeal is

allowed. The impugned Judgment of the Trial Court dated 02.11.2016

is set aside. Suit of the appellant/plaintiff is decreed for a sum of Rs.

34 lakhs alongwith pendente lite and future interest till payment @ 6%

per annum simple. Parties will bear their own costs. Decree sheet be

prepared.

SEPTEMBER 24, 2018                           VALMIKI J. MEHTA, J
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