M/S Sampada Enterprises vs M/S Tgs Construction Private ...
2021 Latest Caselaw 2244 Kant

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

       DATED THIS THE 15TH DAY OF JUNE, 2021

                     PRESENT

       THE HON'BLE MR.JUSTICE ARAVIND KUMAR

                       AND

   THE HON'BLE MR.JUSTICE N.S.SANJAY GOWDA

               R.F.A.No.66/2021(DEC)

BETWEEN:

M/S SAMPADA ENTERPRISES,
REGISTERED PARTNERSHIP FIRM
HAVING ITS OFFICE AT
G-16, RAVI HILL VIEW LAYOUT,
ITTAMADU, BSK III STAGE,
BENGALURU - 560 085
REPRESENTED BY ITS PARTNER,
J.PRAVEEN KUMAR SINGH,
SON OF SRI. G.JAYAPAL SINGH,
AGED ABOUT 47 YEARS,
RESIDING AT No.FF-1,
SUMUKHA ENCLAVE,
No.1, 1ST MAIN, 1ST CROSS,
VIVEKANANDA NAGAR,
BENGALURU - 560 085.                   ... APPELLANT


(BY SRI. ASHOK HARANAHALLI, SENIOR COUNSEL FOR
SRI. VENKATESH S.ARABATTI, ADV.)


AND:

M/S TGS CONSTRUCTION PRIVATE LIMITED,
HAVING ITS OFFICE AT No.142,
GROUND FLOOR, 5TH AVENUE,
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5TH MAIN, 6TH SECTOR, HSR LAYOUT,
BENGALURU - 560102
REPRESENTED BY ITS MANAGING DIRECTOR,
DR. MANDEEPKAUR.                  ... RESPONDENT

(VIDE ORDER DATED:24.02.2021, NOTICE TO
RESPONDENT IS DISPENSED WITH)

      THIS APPEAL IS FILED UNDER SECTION 96 OF THE
CPC, AGAINST THE JUDGMENT AND DECREE DATED
15.10.2020 PASSED IN O.S.No.1546/2019 ON THE FILE OF
THE V ADDL. CITY CIVIL AND SESSIONS JUDGE
BENGALURU,     PARTLY   DECREEING    THE  SUIT   FOR
DECLARATION AND DAMAGES.

    THIS APPEAL COMING ON FOR DICTATING JUDGMENT
THIS DAY, SANJAY GOWDA, J., DELIVERED THE
FOLLOWING:


                        JUDGMENT

1. The appellant is the plaintiff.

2. The appellant filed a suit seeking for a declaration

that the registered Joint Development Agreement (JDA)

dated 09.11.2015 executed by the plaintiff in favour of the

defendant as cancelled. A declaration was also sought for

that plaintiff was the absolute owner of the suit schedule

property and a direction to the defendant to pay damages

in a sum of `95,00,000/- was also sought for. Lastly, the

appellant sought for a declaration that all the agreements

entered into by the defendant in respect of the suit

schedule property were not binding on the plaintiff.

3. The facts stated in the plaint was that the plaintiff, a

registered Partnership Firm was the owner of the property

bearing No.21/2 formed in Sy.No.21 measuring 18,833 sq.

ft. situated at Pattanagere Village, Kengeri Hobli,

Bengaluru South Taluk. It was stated that the plaintiff

had purchased the said property under a registered Sale

Deed dated 07.10.2013. It was also stated that permission

had been obtained from the Deputy Commissioner for

using the land for non-agricultural purposes.

4. It was stated that the plaintiff had decided to develop

the suit property by way of a joint development with the

defendant, whereby a multistoried residential complex was

agreed to be constructed by the defendant and the plaintiff

and defendant would share the apartments in the ratio of

42% and 58%. In other words, the plaintiff was to be given

constructed area of 42%, while the defendant, who would

undertake to construct the complex at its own cost, would

get 58% of the constructed area. In addition, it was stated

that under the agreement, the defendant had paid the

plaintiff a sum of `52,00,000/- as goodwill and it had also

paid a sum of `45,00,000/- as refundable security deposit.

In other words, a total sum of `97,00,000/- was paid by

the defendant to the plaintiff as per the averment in the

plaint. It was stated that the terms of the JDA were

recorded in writing and also registered as a Joint

Development Agreement dated 09.11.2015.

5. It was stated that though a sanctioned plan had been

obtained from the BBMP and handed over to the defendant

and a General Power of Attorney (GPA) had also been

executed in favour of the defendant as per the terms of the

JDA, defendant did not undertake any work except some

excavation work. It was stated that since the defendant

failed to start the development of the property, the plaintiff

was forced to issue numerous reminders asking him to

discharge its obligations under the JDA. However, the

said request were of no avail and consequently, the

plaintiff was constrained to issue a notice dated

14.12.2016 proposing to cancel the GPA executed in

favour of the defendant. It was stated that public notice

regarding cancellation of GPA was also published on

16.12.2016 and thereafter, the plaintiff had revoked the

GPA executed in favour of the defendant by execution of a

registered cancellation deed on 28.12.2016. It was stated

that the defendant was avoiding the plaintiff and had

refused to compensate the damages suffered by the

plaintiff. Consequently, left with no other alternative, the

plaintiff was constrained to file a suit seeking for the

aforementioned reliefs.

6. On suit being registered, summons were ordered to

be issued to the defendant. However, the said summons

sent through Court and by registered post were returned

with an endorsement that 'the defendant had vacated the

address'. Substituted service was also taken out by way of

paper publication and even to this, there was no response

and consequently, defendant came to be placed ex parte.

7. The plaintiff, in order to prove his case, examined

one of its partners as P.W.1 and through her, got exhibited

nine documents.

8. Trial Court thereafter framed the following points for

consideration:

"1. Whether the Plaintiff firm proves its title and possession over the suit schedule property as on the date of the suit?

2. Whether the plaintiff further proves that registered General Power of Attorney dated 09/11/2015 came to be cancelled in accordance with terms of JDA dated 09/11/2015?

3. Whether registered JDA dated 09/11/2015 is liable to be cancelled?

4. Whether the plaintiff is entitled for the relief of damages?

5. Whether the plaintiff is entitled for the relief as sought for?

6. What Order or decree?"

9. Trial Court, on consideration of the evidence, arrived

at a conclusion that plaintiff had proved that it had title

over the suit schedule property. However, it came to be

held that plaintiff had not proved that the registered GPA

had been cancelled in accordance with the registered

terms of the JDA and it also came to the conclusion that

JDA was not liable to be cancelled. Trial Court also held

that plaintiff was not entitled for the relief of damages and

it proceeded to decree the suit in part.

10. Trial Court in conclusion has held that plaintiff was

the absolute owner of the suit schedule property.

However, it held that plaintiff was not entitled to the relief

of declaration that JDA was cancelled; declaration that

plaintiff was not bound by the agreements entered into by

the defendant in respect of the suit schedule property and

for damages and has accordingly passed the decree.

11. Being aggrieved by the dismissal of the prayer for

declaration that the JDA was cancelled, the plaintiff was

not entitled for damages and the declaration that the

plaintiff was not bound by the agreements entered into by

the defendant in respect of the suit schedule property, the

appellant is in appeal.

12. In this appeal, the learned Senior Counsel Sri Ashok

Haranahalli appearing for the appellant contended that the

Trial Court has fundamentally arrived at a conclusion that

the suit was liable for dismissal in respect of the prayer for

declaration and damages only on the ground that the

plaintiff had not produced page Nos.19 and 20 of the JDA

and this according to the Trial Court was a deliberate

suppression of material facts which disentitled the plaintiff

from any relief. He submitted that non production of two

pages of the JDA was an inadvertent error and the

appellant had in fact filed an application in this appeal

seeking for permission to produce the entire JDA. He

submitted that since the entire JDA had now been

produced, including the missing pages, the decree could

not be sustained.

13. In this appeal, since the respondent was placed ex

parte in the Court below, notice of this appeal was

dispensed with as provided under Order XLI Rule 14 of

CPC.

14. We have heard the learned Senior Counsel appearing

for the appellant and perused not only the Trial Court

records but also the entire material produced before us.

15. The points that arise for consideration in this appeal

are:

(i) Whether the Trial Court was justified in dismissing the suit in respect of the remaining two declaratory prayers and damages sought for principally on the ground that entire JDA had not been produced?

(ii) Whether the prayer of the appellant for production of entire JDA including the missing pages could be admitted as additional evidence in this appeal?

OR

Whether I.A.1/2021 filed by appellant for production of JDA dated:09.11.2015 (marked as Ex.P.1) deserves to be allowed?

16. As stated above, the simple case of the appellant was

that it had entered into a JDA on 09.11.2015 with the

defendant with the objective of ensuring a multistoried

apartment complex was constructed on the suit schedule

property at the cost of the defendant and after the

apartments were constructed, the plaintiff and the

defendant would share the constructed area in the ratio of

42% and 58% respectively.

17. It was the case of the plaintiff that the defendant did

not undertake any work and it was therefore constrained

to issue a notice to cancel the GPA and since there was no

response even thereafter, it was constrained to file the suit.

18. It is not in dispute that the defendant was served

with the summons in the Trial Court through substituted

service namely paper publication, but chose to remain

absent and was therefore placed ex parte. It is therefore

clear that claim made by the plaintiff remained

unchallenged.

19. However, Trial Court proceeded to decree the suit

partly for the following reasons:

"17. In this regard, on perusal of Ex.P.1 certified copy of JDA dated 09/11/2015 we can find that though plaintiff has sought the relief

of declaration to cancel the alleged JDA dated 09/11/2015 as per prayer column No.i of the plaint, the plaintiff has not furnished complete document i.e. complete copy of JDA, because the relevant and important paragraphs from para 19 to 24 i.e. page 19 and 20 of the said document are not available in Ex.P.1, which indicates that plaintiff has deliberately suppressed the material facts before this court and not come to the court with clean hands.

Even otherwise if we go through in continuation of para 24.b of Ex.P.1 abundantly makes it clear that the said agreement shall not be terminated unilaterally by any of the parties herein and appointment of the builder shall be irrevocable till the completion of the project.

18. It is to be noticed that unilateral contract means-in which only one party makes an express promise or undertakes a performance without first securing a reciprocal agreement from the other party. So an unilateral contract differs from a bilateral contract, in which the parties exchange mutual promises and commonly used in business transactions. In this connection as could be seen from perusal of Ex.P.6 and 7 that though the plaintiff firm got issued legal notice by notifying about the decision to revoke and cancel the GPA executed by the plaintiff firm dated 09/11/2015 (wrongly mentioned in para 2 as 09/11/2016) and it is revoked, but no bit of document viz., postal acknowledgment for having served notice with intimation to the decision of cancellation of GPA is forth coming before this court. Ex.P.9 is nothing but public notice issued in a daily news paper dated 20/12/2016, but again Ex.P.5 cancellation of GPA also does not disclose the participation of the defendant M/s TGS constructions Pvt. Ltd., which also would indicate that the said registered cancellation of GPA is nothing but unilateral and not bilateral, one sided and

contrary to the terms and conditions of Ex.P.1 JDA dated 09/11/2015."

20. As could be seen from the aforesaid reasoning, Trial

Court was of the view that the relevant and most

important pages i.e., page Nos.19 and 20 containing

paragraphs 19 to 24 of the JDA had not been produced

along with certified copy of JDA marked as Ex.P.1 and

therefore this indicated that the appellant had deliberately

suppressed material fact before the Court and he had not

come to the Court with clean hands.

21. The appellant, in this appeal, has produced the

entire JDA along with an application seeking permission to

produce it as additional evidence. We have perused the

entire agreement and we have noticed that the missing

pages i.e., page Nos.19 and 20 containing paragraphs 19

to 24 are also produced in this appeal. We are of the view

that non production of two pages, which was an obvious

inadvertent error, was not a reason for which, the Trial

Court could have penalized the plaintiff by dismissing the

other two declaratory prayers and also the claim for

damages itself. In our considered view, the Trial Court

could have called upon the plaintiff to produce the missing

pages and if the same had not been produced then it could

have proceeded to dismiss the suit. However, the Trial

Court has not chosen to follow this path and this has

caused serious prejudice to the appellant.

22. We are of the view this inadvertent error on the part

of the plaintiff-appellant should not have resulted in non-

consideration of the claim of the plaintiff for a declaration

that the JDA was cancelled. Further, non-production of

JDA with two missing pages being an inadvertent error on

the part of the appellant which is now sought to be

rectified by filing an application seeking for permission to

produce the entire JDA, we are of the view that the said

application deserves to be allowed and the same is

accordingly allowed. Consequently point No.2 formulated

is answered in the affirmative namely in favour of

appellant.

23. As a consequence of the entire JDA having been

produced before this Court, in our view, it would be just

and necessary to remand the matter to the trial court since

trial court has proceeded on the footing non production of

the entire JDA had created an impression that plaintiff

had suppressed material facts, which in turn, disentitled

the plaintiff for consideration of three of its claims. The

error of not producing the entire JDA having been rectified

by production of the entire JDA in this appeal thus

entitles the appellant to an order of remand with a

direction to the trial court to reconsider the remaining tow

declaratory prayers and the claim for damages afresh and

come to an appropriate conclusion in accordance with law.

24. We accordingly answer both the points of

determination in favour of the appellant and hold that the

judgment and decree of the trial court insofar as the

dismissal of the suit in relation to the remaining two

declaratory prayers and claims for damages cannot be

sustained.

25. We make it clear that we are not expressing any

opinion on the merits of the case. We also make it clear

that trial court shall issue a fresh notice to the

defendant/respondent and thereafter decide the matter in

accordance with law.

26. Thus, we hereby allow this appeal, set aside the

impugned judgment and decree dated:15.10.2020 passed

in O.S.No.1546/2019 on the file of the V Additional City

Civil and Sessions Judge, Bengaluru and remand the

matter to the trial court with a direction to the trial court

to permit the appellant to produce the entire JDA dated

09.11.2015 as an exhibit and then consider the matter

afresh in accordance with law after issuing fresh summons

to the defendant. The appellant shall also be permitted to

adduce further evidence, if it so desires.

27. It is however made clear that the decree of the suit

insofar as grant of declaration that the plaintiff was the

owner of the suit property remains unaffected by this

order.

In view of the this order of remand, the appellant

would be entitled for refund of the entire Court fee as

provided under Section 66 of the Karnataka Court Fees

and Suits Valuation Act. Registry to issue cheque in

favour of the appellant forthwith.

The appellant shall appear before trial court on

12.07.2021 without expecting a notice and shall take

further instruction from the Trial court.

Sd/-

JUDGE

Sd/-

JUDGE

PKS