Delhi Development Authority vs R.K. Jain
2019 Latest Caselaw 1132 Del

*            IN THE HIGH COURT OF DELHI AT NEW DELHI

+                         RFA No. 313/2007

%                                                  20th February, 2019

Delhi Development Authority                               ..... Appellant

                   Through:        Mr. Sanjeev Sagar, Standing Counsel
                                   for DDA with Ms. Nazia Parveen,
                                   Advocate (Mobile No. 9811016162).

                          versus

R.K. JAIN                                               ..... Respondent

                   Through:        Mr. Rajesh Aggarwal, Advocate
                                   (Mobile No. 9810179438).


CORAM:
HON'BLE MR. JUSTICE VALMIKI J. MEHTA

To be referred to the Reporter or not?


VALMIKI J. MEHTA, J (ORAL)

1. Though effectively, and the later part of this judgment

will show that there were really no disputes which remained for being

decided in this appeal, however, in order to understand the position

that in reality there are no disputes, narration of the facts of the case

would be required so as to dispose of this Regular First Appeal under

Section 96 of the Code of Civil Procedure, 1908 (CPC) filed by the

defendant in the suit challenging the impugned Judgment of the trial

court dated 29.11.2006.

2. The impugned Judgment dated 29.11.2006 decrees the

suit for permanent injunction filed by the respondent/plaintiff and the

trial court while decreeing the suit in favour of the

respondent/plaintiff, the trial court has directed that the

appellant/defendant cannot claim ground rent at 2½% of the

price/premium paid for the property till 24.06.1998. The disputes

arose because for the first five years, after the grant of allotment of the

suit property purchased by the respondent/plaintiff in auction, the

ground rent payable was to be of only Rs. 1/- per year and it is only

after the expiry of the period of five years from the grant of allotment

that the ground rent would become 2½% of the price/premium paid for

the property.

3. The facts of the case are that the appellant/defendant held

an auction on 18.01.1985 for granting lease rights of the subject

property which is a 148.64 sq. mtr. bearing plot no. B-2, in the Local

Shopping Complex in MMTC/STC Colony, New Delhi. The

respondent/plaintiff was the successful auction purchaser for a price of

Rs. 18,07,000/-. The respondent/plaintiff deposited 25% of the

auction amount of Rs. 4,51,750/- on his bid being accepted. The

balance payment of 75% of the amount of Rs. 18,07,000/- was to be

deposited by the respondent/plaintiff within 60 days from the date of

allotment. The date of allotment as per the Terms and Conditions of

the auction is the date when the appellant/defendant issues the letter

communicating the allotment to the respondent/plaintiff. This Letter

communicating the allotment by the appellant/defendant to the

respondent/plaintiff is dated 01.04.1985. On payment of the balance

amount within 60 days from 01.04.1985 by the respondent/plaintiff,

Clause 5 of the Terms and Conditions of the auction would come into

operation whereby the appellant/defendant was bound to hand over the

physical vacant possession of the property and also execute the lease

deed in favour of the respondent/plaintiff.

4. However, disputes arose because the suit property was

occupied by encroachers and the possession of the suit property was

only given to the respondent/plaintiff on 29.09.1988. Though, at the

time of handing over of possession by the appellant/defendant to the

respondent/plaintiff on 29.09.1988, a lease deed would also ordinarily

have been executed in view of Clause 5 of the Terms and Conditions

of allotment, however since the respondent/plaintiff who had to

deposit the balance amount of 75% within 60 days from 01.04.1985,

and he did not deposit the same within 60 days, but deposited the said

amount much later on 04.12.1986, issue arose of claim of interest by

the appellant/defendant on this 75% amount for the period from

01.04.1985 till 04.12.1986. In this regard, the respondent/plaintiff had

agreed by his Letter dated 14.03.1988 that they would pay interest for

the period of delay of deposit of the 75% of the price at 18% per

annum. This amount towards interest was thereafter deposited by the

respondent/plaintiff on 17.03.1990 with the appellant/defendant.

5. Therefore, as on 17.03.1990, the respondent/plaintiff as

the buyer of the property had paid the complete price of the property,

and having paid the complete price, consequently, in terms of Clause 5

of the Terms and Conditions of allotment, the respondent/plaintiff was

entitled to possession of the property as also the execution of the lease

deed of the property. Execution of the lease deed was important

because it was only on the respondent/plaintiff being granted a lease

deed, would the respondent/plaintiff have been entitled to approach

the appellant/defendant for sanction of the building plan for

construction. As stated above, the possession of the suit property was

already with the respondent/plaintiff with effect from 29.09.1988, and

the balance payment of the price towards interest was paid by the

respondent/plaintiff only on 17.03.1990. Therefore, till 17.03.1990

the respondent/plaintiff could not legally seek execution of the lease

deed or in the alternative an NOC from the appellant/defendant for

making construction on the suit property. However, an NOC was

granted by the appellant/defendant to the respondent/plaintiff some

months later on 05.10.1990.

6. In the aforesaid facts, the issue which therefore required

determination was that what would be the period of first five years,

and in this period only Rs.1/- per year was payable as ground rent, and

consequently therefore when would the period after the first five years

commence for payment of ground rent at 2½% of the price/premium

paid for the property.

7. As already stated above, ordinarily the obligation of the

appellant/defendant for getting execution of the lease deed in favour of

the respondent/plaintiff did arise on 17.03.1990 when the balance

price was paid by the respondent/plaintiff to the appellant/defendant,

but it is admitted by both the parties that though the first period of five

years would commence from 18.03.1990 and would end on

17.03.1995, but since the NOC was only given by the

appellant/defendant to the respondent/plaintiff on 05.10.1990,

therefore, it is not disputed that the first period of five years will start

on 06.10.1990 and end on 05.10.1995. The payment of the ground

rent at 2½% of the price/premium of the property will therefore

commence on 06.10.1995. The parties have therefore agreed before

this Court that the date for commencement of payment of 2½% of the

price/premium as ground rent by the respondent/plaintiff to be

06.10.1995, and once that is so, no other disputes remain to be decided

between the parties.

8. Accordingly, this appeal is disposed of by observing that

the entitlement of the appellant/defendant to claim ground rent at 2½%

of price/premium of the property has commenced against the

respondent/plaintiff only from 06.10.1995.

9. At the time when the subject suit was filed, and for the

respondent/plaintiff to be successful in being granted interim

injunction, the respondent/plaintiff had deposited the disputed amount

in this Court, and this disputed amount was the amount being claimed

by the appellant/defendant. This amount which is deposited in this

Court is lying in an FDR and is thus earning interest. Therefore, now

the appellant/defendant will calculate ground rent payable at 2½% of

the price/premium from 06.10.1995, and accordingly raise a demand

against the respondent/plaintiff payable as from 06.10.1995 till the

respondent/plaintiff deposited the disputed amount in this Court. Till

the amount due to the appellant/defendant from 06.10.1995 was

deposited by the respondent/plaintiff in this Court, the

appellant/defendant also be entitled to interest as per Rules. The

interest due as per the Rules to the appellant/defendant will thereafter

cease because of the amount being deposited in this Court. The

appellant/defendant from the date of deposit in the Court will be

entitled to only that interest which has accrued on the FDR created of

the total amount of principal due from 06.10.1995 alongwith the

interest as per Rules till the date of deposit. Putting it in other words,

the appellant/defendant will not be entitled to interest as per Rules

after the deposit by the respondent/plaintiff of the amount due in this

Court, and that the appellant/defendant thereafter will only be entitled

to interest at that rate at which the fixed deposit has earned interest.

10. Accordingly, this appeal is disposed of by observing that

the date of commencement of payment of ground rent at 2½% of the

price/premium of the property in favour of the appellant/defendant and

against the respondent/plaintiff will be 06.10.1995. The appellant/

defendant will thereafter be entitled to claim interest on this amount

payable as per the Rules till the date of deposit of the principal amount

plus interest as per Rules, by the respondent/plaintiff in the suit in this

Court. After the date of deposit by the respondent/plaintiff in this

Court, the interest which will be payable to the appellant/defendant

will not be as per the Rules of the appellant/defendant but will be the

interest which has been earned on the fixed deposit.

11. Let the amount payable to the appellant/defendant in

terms of this judgment now therefore be calculated by the

appellant/defendant, and such calculation be given to the

respondent/plaintiff through counsel and also to the counsel for the

appellant/defendant, and if the amount available in this Court today in

the fixed deposit would be more than the amount which the

appellant/defendant is entitled to in terms of this judgment, then the

remaining balance will be returned by the Registry of this Court to the

respondent/plaintiff by encashing the FDR.

12. In view of the aforesaid discussion, the appeal is

accordingly disposed of in terms of the aforesaid observations.

FEBRUARY 20, 2019                            VALMIKI J. MEHTA, J