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Synopsis

The Supreme Court has recently ordered M/s Greater Ashoka and Land Development Company to pay Rs 50 lakh as a full and final settlement to the legal representatives of a man, who could not get a plot at the rate of Rs 25 sq yard in a plan approved in 1961 for a colony in Faridabad, despite payment of booking amount and allotment in the year 1963.

A bench of Justices Vikram Nath and Rajesh Bindal said that merely refunding the earnest money paid, after sixty years would be unreasonable as the respondent, Kanti Prasad Jain (deceased) through his legal representatives after booking the plot, had been waiting all along as even in the litigation since 1986. The price of the land in the area has increased manifold for the last 60 years, court noted. 

"We find that allotment of plot was made way back on 19.11.1963. Six decades have passed thereafter. No doubt, there were certain developments in the meantime," the bench said.

After the enactment of the Punjab Scheduled Roads and Controlled Areas Restriction of Unregulated Development Act, 1963 and the Haryana Restriction of Development and Regulation of Colonies Act, 1971, certain permissions were required to be taken by the appellant for the development of the land as a colony, which were taken and even the plot was offered to the respondent. 

However, when the cost of the plot was demanded at a higher rate, even on the asking of the respondent, details were not furnished. The amount demanded was at the rate of Rs 135 per square yard as against Rs 25 per square yard at which initial allotment was made.

During the hearing, the appellant took the stand that at present all the plots had been sold out. 

To this, the bench said, "We are not going into that aspect as the appellant agreed to pay damages to the respondent as, according to it, alternative relief for damages in the form of refund of earnest money along with interest has been claimed. Though the claim, as per the appellant, is for refund of the money along with interest at the rate of 18% per annum, however, the appellant is even ready to pay interest at a higher rate."

The court also went through the prayer made in the suit which showed that in the alternative, only a refund of earnest money along with interest had not been claimed, rather the respondent/plaintiff had claimed adequate damages, which may include refund of the earnest money along with interest. 

"The argument of the appellant (company) that the respondent had requested for refund of the earnest money paid by him vide letters dated 27.01.1975 and 1.01.1976 also deserves to be rejected as it was not responded to by the appellant," the bench said.

The apex court, however, modified the Punjab and Haryana High Court's order which had restored the trial court's decree for specific performance of the contract and set aside the appellate court's order that had reversed the direction for execution of the sale deed.

"Considering the totality of the facts, in our view, the interest of justice will meet in case the impugned judgment and decree of the High Court is modified to the extent that instead of getting the sale deed of the plot registered at the rate of Rs 25 per square yard, in the alternative, the appellant pays a total amount of Rs 50,00,000 to the respondent as full and final settlement of claim in the suit. The amount is to be paid within a period of three months," the bench said.

Case Title: M/s Greater Ashoka And Land Development Company Vs Kanti Prasad Jain (deceased) Through Representatives