Sanjay Singh and Shalini Singh vs Central Himalayan Land Development Co. Ltd.

CIVIL APPEAL NO. 1928 OF 2019 (@ SLP(C) NO.24690 OF 2018) SANJAY SINGH AND ANR. VS. CENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD.

1 Reportable IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 1928 OF 2019 (Arising out of Special Leave Petition (Civil)No.24690 of 2018)

SANJAY SINGH AND ANR. .…Appellants

VERSUS

CENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD. .…Respondent

JUDGMENT

Uday Umesh Lalit, J.

Leave granted.

2. This appeal is directed against the judgment and order dated 25.07.2018

passed by the High Court of Delhi at New Delhi in Regular First Appeal

No.876 of 2016.

Signature Not Verified Digitally signed by MUKESH KUMAR Date: 2019.02.21

3. The appellants had booked a residential plot whereupon a villa was to be 17:12:53 IST Reason:

constructed by the respondent in a project called “Cloud-9 Hill Town” in CIVIL APPEAL NO. 1928 OF 2019 (@ SLP(C) NO.24690 OF 2018) SANJAY SINGH AND ANR. VS. CENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD.

2 village Khabrar, Ramgarh, District-Nainital, Uttarakhand. An agreement in

that behalf was executed on 14.04.2004 in terms of which the total

consideration for the villa was Rs.15,65,000/- and the villa was to be

completed within 30 months. Later, sale deed in respect of the plot was

registered in favour of the appellants on 14.05.2004. According to the

appellants they had secured loan to the tune of Rs.13,30,000/- from a bank

and had paid all the instalments as and when they were due. On or about

03.10.2007 the appellants received a demand notice for payment of balance

consideration of Rs.5,13,850/- together with interest @ 24%. The amount of

Rs.5,13,850/-was tendered by the appellants on 12.10.2007 but the cheque

was returned by the respondent.

4. Thereafter, a statement of accounts was prepared by the respondent

which reflected outstanding dues to the tune of Rs.5,13,850/- towards

principal sum and interest amounting to Rs.3,61,460/-, the total being

Rs.8,73,556/-. Soon thereafter, the respondent filed a Summary Suit for

recovery of said amount of Rs.8,73,556/-. The Suit was registered as CS

No.431/14/2008 on the file of Additional District Judge, Tis Hazari, New

Delhi.

CIVIL APPEAL NO. 1928 OF 2019 (@ SLP(C) NO.24690 OF 2018) SANJAY SINGH AND ANR. VS. CENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD.

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5. A Consumer Complaint was filed by the appellants being CC/110/2008

against the respondent submitting that though the outstanding amount was

tendered by the appellants on 18.10.2007, the respondent refused to accept the

same unless the principal sum was accompanied with interest @ 24% and that

the project was not completed in time as a result of which the appellants were

put to loss. It was prayed that the respondent be asked to deliver possession

of villa along with all the facilities and accept the balance payment of

Rs.5,13,850/-. The respondent contested the claim and submitted that the

appellants never paid instalments as per schedule; that there was no delay on

part of the respondent; and, therefore, the respondent was justified in

demanding interest.

6. The complaint was allowed by District Forum-II, New Delhi by order

dated 29.04.2010 which directed the respondent to deliver the completed villa

to the appellants against the balance payment of Rs.5,13,850/- without any

interest and further directed the respondent to pay compensation to the tune of

Rs.1,00,000/- to the appellants. The order passed by the District Forum-II is

presently pending appeal before the State Commission, New Delhi. CIVIL APPEAL NO. 1928 OF 2019 (@ SLP(C) NO.24690 OF 2018) SANJAY SINGH AND ANR. VS. CENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD.

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7. The Civil Suit filed by the respondent was dismissed by Additional

District Judge-15 (Central), Tis Hazari Courts, Delhi by his judgment and

order dated 30.07.2014. The principal issue framed was whether the

respondent was entitled to recovery of Rs.8,73,556/- as alleged? The case put

up by the respondent was not accepted by the trial court and rejecting all the

contentions of the respondent the suit was dismissed.

8. The respondent being aggrieved filed Regular First Appeal No.876 of

2016 in the High Court with an application to condone the delay of 721 days

in filing said appeal. The explanation offered in support of condonation of

delay was that the then advocate had not informed the respondent about the

disposal of suit; that the respondent was, therefore, constrained to lodge a

complaint against said advocate before the Bar Council of Delhi, which was

pending adjudication and that the respondent ought not to suffer on account of

the failure on part of their advocate. The appeal came up before the High

Court on 16.04.2018. After going into the rival contentions, the High Court

observed:

“Considering the facts and circumstances of this case, as recorded in the previous orders, where only some part of the total consideration is due and that too the same was tendered by the Respondents but was not CIVIL APPEAL NO. 1928 OF 2019 (@ SLP(C) NO.24690 OF 2018) SANJAY SINGH AND ANR. VS. CENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD.

5 accepted by the Appellant Company, it is directed that the balance sale consideration of Rs.5,13,850/-, shall be deposited by the Respondents in this Court within a period of four weeks. Upon the same being deposited, the Appellant Company shall hand over the possession of the Villa for the peaceful occupation and enjoyment of the Respondents. The Appellant Company shall ensure that the Villa would be in liveable condition and shall be complete in all respects.

Considering the allegations made against the Company and the status report, which has been handed over by the police station Amar Colony, it is directed that a responsible person from the management of the Appellant Company shall remain present in the Court on the next date of hearing.

The question, as to whether the Appellant Company is entitled to interest due to the alleged delay in payment of the principal sum, shall be decided at the time of final hearing of the appeal. Original status report is taken on record.

List on 23rd May, 2018 for final hearing. Trial court record be requisitioned for the next date of hearing.”

9. The matter was, thereafter, taken up by the High Court on 23.05.2018

when it was observed:

“The Respondent is stated to have deposited the money as directed on the last date, with the Registrar General of this Court. The amount shall be kept in a FDR on automatic renewal mode. The possession of the villa has not yet been given by the Appellant. They undertake that the possession of the fully completed CIVIL APPEAL NO. 1928 OF 2019 (@ SLP(C) NO.24690 OF 2018) SANJAY SINGH AND ANR. VS. CENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD.

6 villa shall be handed over to the Respondents on 15th July, 2018.”

10. As per record, the amount of Rs.5,13,850/- which was stated to be

balance payable towards the principal sum, was deposited by the appellants

with the Registry of the High Court. The amount was, thereafter, converted

into a Fixed Deposit Receipt awaiting final directions in the matter.

According to the order dated 23.05.2018, it was undertaken by the respondent

that the villa would be handed over and the possession of the villa was

accordingly handed over to the appellants.

11. Thereafter, the matter came up before the High Court on 25.07.2018.

The High Court accepted the explanation for condonation of delay and

condoned the delay of 721 days, subject to payment of costs of Rs.20,000/- to

be made over by the respondent to the appellants. The High Court also

observed:-

“6. The subject suit was a suit for recovery of moneys filed by the appellant/plaintiff. For the settlement, the appellant/plaintiff was directed to hand over the villa constructed for the benefit of the respondents/defendants pursuant to an interim order passed by a learned Single Judge of this Court and whereby respondents also deposited a sum of Rs.5,00,000/- in this Court. There cannot be an interim CIVIL APPEAL NO. 1928 OF 2019 (@ SLP(C) NO.24690 OF 2018) SANJAY SINGH AND ANR. VS. CENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD.

7 order in a proceeding which is beyond the scope of main proceedings. The subject suit since was a suit filed by the plaintiff for recovery of moneys which has been dismissed and the present appeal is against that decree, by an interim order the respondents cannot receive possession of the disputed flat/villa constructed by the appellant in Cloud-9, Hill Town, Village Khabrar, Ram Garh, District Nainital, Uttarakhand. Therefore, it is ordered that the amount deposited by the respondents in this Court be released back to the respondents along with accrued interest thereon within a period of four weeks from today and simultaneously or before the respondents will hand over possession back of the subject villa received by the respondents from the appellant pursuant to interim orders in this appeal to the appellants.”

The First Appeal was admitted and directed to be listed in due course

as per the year of its seniority.

12. The aforesaid order dated 25.07.2018 is now under challenge. While

issuing notice, this Court had stayed the operation of said order.

13. We have perused the record and considered rival submissions advanced

by learned counsel for both the sides. The following features are clear:-

a) The balance sum of Rs.5,13,850/- which was supposed to be due

from the appellants was deposited by the appellants.

CIVIL APPEAL NO. 1928 OF 2019 (@ SLP(C) NO.24690 OF 2018) SANJAY SINGH AND ANR. VS. CENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD.

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b) In terms of the order dated 23.05.2018 the amount so deposited

stands converted into a Fixed Deposit Receipt.

c) In terms of the order dated 23.05.2018 and as undertaken by the

respondent, possession of the villa was made over to the appellants.

14. In the instant case, that the High Court in its order dated 16.04.2018 had

sought to bring about a situation where the area of controversy could be

minimized and at the same time the possession of the villa could be made

over the appellant. The next order dated 23.05.2018 shows that the appellants

had deposited the sum as indicated and the possession was agreed to be

handed over by the respondent by 15.07.2018. The possession of the villa

was actually handed over. In the circumstances, the question for our

consideration is whether the High Court was justified in reversing the

situation. According to us, the situation having been brought about in terms

of the understanding between the parties as recorded in the earlier orders of

the High Court, there was no reason for the High Court to direct reversal of

the situation.

15. But, what is more striking is that the delay to the tune of 721 days was

condoned by the High Court when there was no satisfactory explanation. In CIVIL APPEAL NO. 1928 OF 2019 (@ SLP(C) NO.24690 OF 2018) SANJAY SINGH AND ANR. VS. CENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD.

9 our view, there was gross negligence on part of the respondent and the

explanation offered in support of the prayer for condonation does not appear

to be correct. This is evident from the fact that no effective steps were taken

to pursue the complaint which was lodged against the then advocate. In the

petition for special leave, it was asserted that the complaint against the

Advocate was not being proceeded with and the respondent had remained

absent on the relevant date. Said assertion was not answered satisfactorily in

the affidavit in reply filed in this Court. Taking totality of the circumstances,

in our view the delay ought not to have been condoned by the High Court.

We, therefore, accept the submission of the appellants and set aside the order

condoning delay. Consequently, the First Appeal also stands dismissed.

16. However, considering the developments that have taken place while the

appeal was pending in the High Court, we pass following directions:-

a) The possession of the villa which was handed over to the appellants

in pursuance of the order dated 23.05.2018 shall continue to remain with

the appellants and be taken to be in terms of the Agreement entered into

between the parties.

CIVIL APPEAL NO. 1928 OF 2019 (@ SLP(C) NO.24690 OF 2018) SANJAY SINGH AND ANR. VS. CENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD.

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b) The amount of Rs.5,13,850/- deposited by the appellants in the

Registry of the High Court which stands converted into a Fixed Deposit

Receipt, upon maturity shall be made over to the respondent along with

interest accrued thereon.

c) The pending appeal before the State Commission shall be

dealt with on its own merits.

17. With the aforesaid directions this appeal is allowed. No costs.

..………..…..……..……J. (Uday Umesh Lalit)

...………….……………J. (Ashok Bhushan) New Delhi, February 21, 2019.