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Supreme Court Affirms Jurisdictional Scope in Contractual Disputes: The Municipal Committee Katra Case

Case Title: MUNICIPAL COMMITTEE KATRA & ORS. Vs. ASHWANI KUMAR

Case No.: CIVIL APPEAL NO(S). 14970-71 OF 2017

Dated on: May 09, 2024

Coram: J. B.R. GAVAI, J. SANDEEP MEHTA

Facts:

The case involves a dispute between the Municipal Committee Katra and Ashwani Kumar regarding a contract for supplying mules and mazdoors for transporting pilgrims to the Mata Vaishno Devi shrine. Ashwani Kumar, the second highest bidder, became the highest bidder after the original highest bidder declined the contract. The contract required 40% of the bid amount to be deposited within 24 hours, along with bank guarantees and post-dated cheques for the remaining amount. Kumar sought relaxation from this clause, but the Municipal authorities denied it, prompting him to file a civil suit. The District Judge granted a temporary injunction in Kumar’s favor, directing the Municipal Committee to issue the work order, which was later upheld by the High Court. Kumar began work on 10th May 2010, but later claimed losses for the 33 days prior to this date, filing a writ petition seeking compensation. The High Court directed the Municipal Committee to consider Kumar’s claim.

Issues:

  • Whether the High Court in exercise of writ jurisdiction, was entitled to entertain a dispute which was purely civil in nature filed for claiming monetary relief/damages arising from fallout of contractual obligations.

Legal Provisions:

  • Clause-8 of the Notice Inviting Tender (NIT):

It states that the successful highest bidder, shall have to deposit 40% of the offered amount at the time of provisional acceptance of the offer by the committee immediately but not later than 24 hours from the time of acceptance.

Contentions of the Appellants:

The appellants, Municipal Committee Katra, contended that the High Court improperly exercised its writ jurisdiction to entertain a dispute purely of a civil nature involving monetary relief arising from contractual obligations. They argued that the respondent’s request to relax the bank guarantee condition in the tender was unjustified. They also maintained that the respondent had already been provided relief through a temporary injunction and subsequent orders which allowed him to execute the contract, thus making his claim for additional compensation for the delayed start period unwarranted.

Contentions of the Respondent:

The respondent, Ashwani Kumar, contended that the provision in the tender requiring him to provide a bank guarantee for the remaining contract amount was unjust and arbitrary. Additionally, he argued that the delay in commencing the contract, which started from May 10 instead of April 1 as originally intended, resulted in a loss of revenue for 33 days. Consequently, he sought compensation amounting to Rs. 71,06,276, representing the purported loss incurred due to the curtailed contract period.

Court’s Analysis & Judgement:

The Hon’ble SC analysed whether the High Court had the jurisdiction to entertain a dispute of a purely civil nature, especially one concerning contractual obligations and claims for monetary relief. It examined the terms of the tender, particularly Clause 8, which specified the requirements for depositing the bid amount and providing a bank guarantee. The Court considered the respondent’s contentions regarding the alleged arbitrariness of Clause 8 and the loss suffered due to the delayed start of the contract.

Eventually, the Hon’ble SC upheld the decision of the High Court to entertain the dispute, emphasizing the importance of ensuring fairness and reasonableness in contractual agreements, especially those involving public authorities. It directed the appellants to consider the respondent’s claim for compensation within a specified timeframe.

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Judgement Reviewed By- Shramana Sengupta

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Delhi High Court appointed a substitute Arbitrator on account of abandonment of Arbitration proceedings by the erstwhile Arbitrator

Case title: North East Centre of Technology Application and Reach (NECTAR) Vs Divine Bamboo Mat Manufacturing Pvt. Ltd. & Anr.

Case no.: O.M.P.(T) 1/2024

Decision on: April 8th, 2024

Quoram: Justice Ms. Justice Neena Bansal Krishna

Facts of the case

The present petition sought for the appointment of a substitute Arbitrator. In this case, NECTAR and Divine Bamboo Mat Manufacturing Pvt. Ltd. had entered into a contract in 2008, through the Original Agreement for Technology Development Assistance valued at Rs. 1,75,00,000/- in lieu of setting up and developing the project for manufacturing of Bamboo Mat Composites. In furtherance of it, a Hypothecation Deed was executed between the parties at New Delhi with regard to certain present and future moveable assets of the respondent. The parties also entered into a Supplementary Agreement (I) which modified the original agreement in respect of the sanction amount. Subsequently, another Supplementary Agreement (II) was entered by the parties, wherein the respondent agreed to repay the amount of Rs. 2,20,00,000/- according to the modified schedule. Though, the petitioners made proposals for settlement, the respondent failed to pay the due amount.

The Clause 17 of Original Agreement provided for Arbitration and also mentioned the venue of Arbitration to be New Delhi. Consequently, the Notice of Invocation of Arbitration was served to the respondent. But however, they ignored the same and stopped communicating with the petitioner. The petitioner appointed the sole Arbitrator to adjudicate the disputes inter se the parties. Upon commencement of arbitral proceedings, both the parties submitted their claims and counterclaims before the Arbitrator. However, the matter reached a deadlock when the respondent filed an Application under Sections 12 and 13 of the Act challenging the appointment of Arbitrator.

Submission of the Parties

The Counsel for the Petitioner detailed the array of facts in the submissions. He asserted that despite the agreement to pay the outstanding amount by the respondents, they defaulted in their repayment obligations in terms of Original Agreement, Supplementary Agreement (I) and (II). Further, he submitted all the facts and circumstances of the case leading to its deadlock. Hence, the Counsel filed a petition under Section 14 read with Sections 15 and 11 of the Arbitration and Conciliation Act, 1996 seeking for the appointment of a substitute Arbitrator to break the deadlock.

The Counsel for respondents on instructions submitted that he has no objection in allowing the present petition. Hence, he did not raise any objections in the present matter.

Legal Provisions

Section 11 – It provides for the Appointment of Arbitrators.

Section 12 & 13 – They provide for the Grounds and Procedure for challenging the Appointment of an Arbitrator.

Section 14 & 15 – They provide for the Termination of Mandate of Arbitrator and his Substitution by another.

Court’s Analysis and Judgement

The Court addressing the question of limitation for filing the application relied on the case of Tarun Kr. Jain, Sole Proprietor vs. M.C.D., which held the limitation period for the substitution of Arbitrator under Section 14 of the Act, 1996 to be three years. It noted that in the present case the time limit for the mandate of the Arbitrator had expired, as per Section 29A of the Act, 1996, even after excluding the COVID-19 Pandemic period. Considering the fact that no proceedings have been undertaken by the Arbitrator since 14.12.2019 when the Application under Section 12 of the Act, 1996 was made, the Court stated that the Arbitrator had abandoned the Arbitration proceedings and also had withdrawn from his Office.

In light of these circumstances, the Delhi High Court allowed the present petition and appointed Mr. Justice V.K. Jain, retired Judge of Delhi High Court, as a substitute Arbitrator to adjudicate the disputes between the parties. Thereby, it facilitated the parties to present their claims and counterclaims before the arbitrator.

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Judgement Reviewed by – Keerthi K

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Reexamining the notion that time is not the essence of a contract involving immovable property is necessary: Karnataka High Court

Case No: 406/2007.

Facts of the case:-

The Plaintiff commenced legal proceedings to enforce the 20.07.2006 sale agreement by specific execution of the contract. As an alternative, Rs. 11,51,000 with interest charged at a rate of 15% annually is requested damages and a return of the earnest money. According to the plaintiff, PW-1, the plaintiff’s power of attorney holder, paid Rs. 5 lakhs as advance consideration on July 20, 2006, and the remaining Rs. 6,51,000/-was supposed to be paid at the time the sale deed was registered. Six months were allotted in the agreement to finish the sale transaction. The plaintiff contended that the defendant failed to show up to sign the sale deed despite his constant readiness and willingness to fulfill his half of the bargain. The accused objected to the lawsuit. The defendant acknowledged carrying out the arrangement. Nevertheless, it was argued that the contract’s deadline was crucial. The defendant further claims that the plaintiff failed to pay the remaining consideration amount within the allotted six months. The defendant asserted that because the deal was not finalized within the allotted six months, he verbally withdrew the selling agreement dated July 20, 2006.

Appellant Contentions:-

Learned counsel Sri.K.L.Patil, appearing for the appellant, made the following submissions:

(i) The suit for specific performance is decreed for recovery of the nearest amount which overcomes the contentions of the respondent. The agreement is considered proven, and the defendant has not made a decision about returning the money. Therefore, a cannot challenge the execution of the sales contract.

(ii) In the case of sale of immovable property, time is not of the essence in a contract and this well-settled principle of properly considered by the trial court. The district court erred when it found that the content of the agreement concluded on 20.07.2006 is time.

(iii) According to the terms of the contract, the defendant must request the cancellation of the contract by refunding the outstanding fee if the remaining fee is not paid within 6 months. The defendant could not cancel the contract and did not return the advance payment. Therefore the claim that the defendant did not cancel the contract is false. The defendant admitted in cross-examination that the plaintiff is a fairly wealthy man. This showed the readiness and willingness of the plaintiff to perform the contract. Shortly after the plaintiff noticed a public notice soliciting opposition to the defendant’s proposed sale of the properties to a third-party, the plaintiff filed suit for specific performance contract. The district court erroneously found that the plaintiff was not ready and unwilling to perform his part of the contract.

(vi) Alternatively, if a specific action is not possible for any valid reason, there should have been compensation order in addition to the order to return the amount with 15% interest on the claimed amount.

The learned counsel for the Appellant has relied on the following judgments:

(a) Man Kaur (Dead) by lrs vs. Hartar Singh Sangha (2010) 10 SCC 512

(b) Swarnam Ramachandran vs. Aravacode Chakungal Jayapalan, AIR online 2004 SC 907

(c) Balasaheb Dayandeo Naik (Dead) through lrs &Ors vs. Appasaheb Dattatraya Pawar AIR 2008 SC 1205

(d) Gaddipati Divija vs. Pathuri Samrajyam AIR online 2023 SC 290

(e)M/s Greater Ashoka and Land Development Company vs. Kanti Prasad Jain (Deceased) Through lrs. SLP No.23655-56/2018

Respondent Contentions:-

Learned Elderly counsel Sri.S.P.Shankar appearing on behalf of the replier/defendant would raise the following contentions it’s demonstrated in the cross-examination of the Pw- 1. The power of attorney holder of complainant that Pw- 1 has Spentrs. 5 lakhs( quantum allegedly with him after paying 5 lakhs as advance consideration quantum) which the complainant claims to have given to buy the property. Hence, PW1 had no plutocrat to complete the trade sale. The complainant alone could have spoken about his readiness and amenability to perform his part of the contract and he nestled down from the substantiation box.

The alleged power of Attorney holder is unskillful to speak about the intention of the complainant to perform his part of the contract. It doesn’t seem like the sale agreement entered into on behalf of the principal is the one marked at Ex. P17. The purported power of attorney is not mentioned in the agreement. To have been carried out in PW-1’s favor. Not even in the complaint is there any mention of the purported attorney’s authority in PW-1’s favor. The purported power of attorney, dated 02.02.2003 (Ex.P10), is fabricated and predated.The plaintiff asked for two different remedies. 

(a) Relates to a contract’s specific performance. An alternate remedy for the reimbursement of the earnest money and compensation is relief.

 (b)The order for the return of the earnest money has been approved by the court. Because of this, the plaintiff is not a party to the dispute and cannot contest the order that returns the earnest money, which was awarded in response to the prayer included in the plaint.

Learned Senior counsel appearing for the Respondents relied upon the following judgments:

(i) Vidyadhar vs. Manikrao and another (1999)3 SCC 573

(ii) Man Kaur (Dead) by lrs. Vs. Harthar Singh Sangha (2010) 10 SCC 512

(iii) N P Thirugnanam (Dead) by lrs vs. Dr.R.jaganmohan Rao and others AIR 1996 SC 116

(iv) Loonkaran Sethia etc vs. Mr.Ivan E John & others Etc , AIR 1977 SC 336

(v) Mohinder Kaur vs. Sant Paul Singh (2019) 9 SCC 358

(vi) Janki Vashdeo Bhojwani & another vs. Indusind Bank Ltd & others AIR 2005 SC 439

(vii) Lt.Cdr. MC Kendall vs. S. Chandrashekar ILR 1991 Kar 4142

(viii) (viii)Gangabai vs Vijay kumar and others AIR 1974 sc 1126

(ix) Sharnamma vs Renuka and others (RSA No.7034/2011)

Court Analysis and Judgement:-

The court believed that the agreement for sale is in respect of land measuring 2 Acres and 27 guntas. The boundaries of the properties indicate that the land is adjacent to a national highway. This court can certainly take judicial note of the fact that there is a considerable escalation in the value of the land. It is also relevant to note from a recital in the agreement for sale, the plaintiff came forward to purchase the property from the defendant who needed money and received Rs.5,00,000/- in advance. That payment must have provided some sort of succor to the defendant who was in dire need of money. This court should also bear in mind that the trial court has awarded 6% interest on the consideration amount of Rs.5,00,000/- which if calculated comes approximately to Rs.4,87,500/-.

The defendant has not questioned the decree for refund of earnest amount and also the interest awarded on it. The plaintiff has claimed damages of Rs.6,51,000/- which according to him is the balance payable on the sale agreement. Since the court has concluded that the time was the essence of the contract and the plaintiff did not prove readiness and willingness to perform the contract, there cannot be a decree for compensation of Rs.6,51,000/- as claimed. Since this court is awarding the compensation despite the plaintiff not performing his part of the contract, and it is primarily based on the concession by the respondents who left to the discretion of the court to award a reasonable compensation, this court is of the view that interest of justice will be met if 60% of the compensation amount of Rs.6,51,000/- claimed i.e., Rs.3,90,600/- which is rounded off to Rs.4,00,000/- is awarded with 7% interest per annum from the date of the suit till realization of the amount.

Thus, the Plaintiff/appellant is entitled to Rs.5,00,000/- towards refund of earnest amount and Rs.4,00,000/- towards compensation, and with 7% interest per annum on Rs.9 lakhs from the date of the suit till realization.

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Judgement Analysis Written by – K. Immey Grace

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A notice to terminate the contract cannot be issued unilaterally by one party without the adjudication of the Court: Jharkhand High Court

Case title – M/s Aditya and Rashmi Construction Pvt. Ltd. VS The State of Jharkhand & Ors

Case no. – W.P. (C) No. 2924 of 2014

Decision on – February 27, 2024

Quoram – Justice Rongon Mukhopadhyay & Justice Deepak Roshan

Facts of the case

The Petitioner, M/s Aditya and Rashmi Construction Pvt. Ltd, a Private Limited Company, participated in a tender process floated by the respondent-authorities for construction of a High-Level Bridge over Mayurkola River at 17 Km. The petitioner being the successful bidder was awarded the contract of Rs.3,00,36,287/- and the time for completion was 13 months. The Parties entered into an agreement for the same.

The Petitioner’s work got delayed due to non-acquisition of land and non-payment of compensation by the respondents. Despite, several representations to the authorities to remove such hindrances and facilitate the construction work, there was no action taken by the respondents.

Although an extension of time was granted to the Petitioner upon its application, the same was contradicted by serving a show cause notice on the potential termination of the contract and blacklisting. The Petitioner responded to the notice, but however, the contract was terminated. Further, the authorities issued an order to recover an amount of Rs. 1,04,33,493/- on the ground of fundamental breach, negligence and slow progress in the work allotted to the petitioner. Subsequently, a writ petition was filed by the Petitioner before the High Court.

Submission on behalf of the Petitioner

The Counsel appearing for the Petitioner submitted that termination of the contract issued by the respondent is in gross violation of the principle of natural justice. Moreover, though a show cause notice was issued to the petitioner, no personal hearing was given prior to such termination.

He further, submitted that the delay in the construction work is due to the lethargic attitude of the respondents in acquiring the land and thus, contended that the petitioner was not at any default.

The Counsel submitted that the respondent-authorities have unilaterally terminated the contract and issued a certificate case for realization of the damages. Further, there was also no adjudication on this matter to fix the quantum of damages.

Submission on behalf of the Respondent

The Counsel highlighted clause 49 of the SBD Agreement, which outlines that the obligation of the contractor to pay liquidated damages to the employer on account of failure of completion of the work allotted within the intended completion or on account of the fundamental breach of the contract by the contractor.

The Counsel argued that attributing project failure solely to the respondent authorities, emphasizing that the lack of land acquisition during a specific period cannot solely be deemed to be the fault of the respondent.

Court’s Analysis and Judgement

The Court noted that the construction of Bridge was not possible without the complete acquisition of the land. The Court observed that the show cause notice to terminate the contract was issued immediately after the authorities granted a time extension for the Construction. Moreover, the authorities proceeded without providing the petitioner an opportunity to be heard before the termination.

The Court asserted that the mere acquisition of the land without extending the compensation to the land holders would automatically lead to disruption in the construction process.

The Court after the perusal of the facts pointed to arbitrary action by the authorities in terminating the contract wand imposing Rs. 1,04,33,493/- as liquidated damages instead of closing the contract or refunding of the security deposit.

The Court relied upon the decisions in State of Karnataka vs Shree Rameshwara Rice Mills, J.G. Engineers Private Limited vs Union of India and Another, and Inox Air Products Limited vs Steel Authority of India Limited, which emphasized that whether either party breached the contract terms must be adjudicated by a Court or Tribunal, and cannot be unilaterally decided by one party.

The Court held that despite repeated representations by the petitioner the respondent-authorities failed to provide any response in that regard. Therefore, the Court allowed the writ petition and quashed the order terminating the contract and demanding the liquidated damages.

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Judgement Reviewed by – Keerthi K

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“NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION OVERSTEPPED ITS POWERS AND JURISDICTION”: SUPREME COURT

CASE TITLE:  Venkataraman Krishnamurthy and Anr. v. Lodha Crown Buildmart Pvt. Ltd.

CASE NO: Civil Appeal No. 971 of 2023

DECIDED ON: 1.03.2024

QUORUM:  Hon’ble Justice Sanjay Kumar

FACTS OF THE CASE

This Civil Appeal has been filed by the complainants aggrieved by the order passed by the National Consumer Disputes Redressal Commission (NCDRC). The respondent company was constructing a building wherein the appellant wished to buy an apartment. Hence, the appellant and the company entered an Agreement to Sell on 29.11.2023. After that, a four bhk flat in ‘Lodha Evoq’ was allotted to the appellants. As mentioned in the contract’s payment schedule, the appellants were supposed to make payments in four instalments, and the balance amount was to be paid at the time of fit-outs. When the complaint was filed, it was undisputed that the appellants were up to date with their payments in accordance with the contract. The contract further mentioned that the respondent party was supposed to hand out the apartment on two occasions: one for fit-outs by 30.06.2016 and the second for the offer of possession of the apartment along with the issuance of the occupancy certificate. A grace period of one year was given to the company in case of failure to provide the apartment on the aforementioned date. The company failed to comply with the terms and conditions by not giving the apartment on an earlier date. Hence, the appellants approached the NCDRC, praying for a refund of the amount they paid with a compound interest of @18% p.a., as well as compensation for the litigation costs and mental distress caused.

The respondent party is hereinafter referred to as the ‘OP’.

The NCDRC passed the following judgement:

The NCDRC directed the OP to give the entire physical possession of the property to the complainants within three months from the date this order was passed.

Both parties must inspect the property in question together, and in case of any deficiencies, the same must be reversed within 30 days of the inspection. The OP shall inform the complainants in writing after making the necessary changes and give them 15 days to complete the required formalities to be fulfilled to possess the property. The OP can also demand maintenance costs, such as car parking, club membership, etc., from the complainants. If the OP deems it necessary, it can take an indemnity bond from the complainants to pay taxes the authorities may likely demand in the future.

The OP shall bear compensation for delay in property transfer at simple interest 6% p.a. Parties are to bear their litigation costs. If the complainants wish to seek a refund, the OP shall be informed in writing within 15 days of the order. The OP shall refund the money after deducting the deposit amount within two months of the request made by the complainants.

APPELLANTS CONTENTIONS

The appellants contended that the respondent company did not comply with the contractual terms since they failed to offer the property for fit-outs on the time and date mentioned in the agreement. The possession of the apartment was to be delivered to the appellants on 30.06.2016 or extended by the grace period of one year.

RESPONDENT’S CONTENTIONS

The respondents contended that they had already obtained the occupancy certificate required before the expiry of the grace period. They informed the same to the appellants via email and asked them to make balance payments for the final property transfer. However, the appellants did not respond to the mail; hence, the respondent did not breach the contract. Additionally, they contended that the appellants wanted to terminate the contract due to the introduction of the Goods and Services Tax. They only want to avoid tax.

LEGAL PROVISIONS

Regulation 6(7) of the Development Control Regulations, 1991.

COURT ANALYSIS AND JUDGEMENT

The respondent company had obtained a ‘Part Occupancy Certificate’ from the Town & Country Planning Division of Mumbai instead of an Occupancy Certificate. The certificate was issued on the condition that the respondent company must finish the internal work before applying for a total occupancy certificate. The format was not in accordance with Regulation 6(7) of the Development Control Regulations, 1991. Moreover, the respondent company bypassed the date of offering the apartment for fit-outs. It directly offered possession of the apartment and could not even procure the full occupancy certificate, which cannot be overlooked as it is a severe breach of the terms of the contract. The appellants rightfully exercised their rights to terminate the contract and contended that they had not received any letter for the offer of property for fit-outs.

The NCDRC opined that the respondent company’s delay in issuing the flat was not unreasonable. But if the complainants still want to terminate the agreement and seek a refund, the respondent’s company shall return the amount they paid in full after reducing the deposit amount. Hence, it passed the aforementioned judgement. However, it cannot be contended that there was no delay in providing possession of the property since it can be deduced that the contract provided a full occupancy certificate. To this effect, the respondent party still has to issue an occupancy certificate.

The Supreme Court stated that when the parties enter into a contract outlining all the terms and conditions, they must abide by the same. If the contract provides for the actions to be taken in case of a breach, then such a method must be followed. If not, the complainants can legally enforce the same on the party at fault.

In the case of General Assurance Society Ltd. v. Chandumull Jain and another[1] relating to insurance documents, it was held that the court’s duty is limited to interpreting the documents rather than amending them. This changes the structure and substance of the contract; hereby, the court goes beyond its powers. Hence, however unreasonable the contract may be, it is not the court’s responsibility to make changes. The court must interpret the contract and apply the established terms and conditions. The same was reiterated in the case of Rajasthan State Industrial Development & Investment Corporation vs Diamond & Gem Development Corporation[2], Ltd. Shree Ambica Medical Stores vs Surat People’s Coop. Bank Ltd.[3] and GMR Warora Energy Ltd. vs Central Electricity Regulatory Commission[4].

The court said that the respondent company could not argue because the appellants accepted their proposal of delayed apartment delivery. The appellants were informed about the delay on two separate occasions. However, their response still demanded that the occupancy certificate be uploaded to the website to obtain a loan. The appellants were scheduled to see the property/apartment in question on 14.06.2017, which was delayed to August 2017 or later. It is unknown when the appellants were given the ‘part occupancy certificate’, but it is undisputed that after the expiry of the grace period, the appellants immediately sought to terminate the agreement by providing notice to the respondent company in writing. The appellants rightfully followed the terms and conditions of the contract. The respondents cannot infer the communication between the parties before the expiry of the grace period as a green signal by the appellants. It is not suggestive of their acceptance when they were not even aware of the full facts of the situation then. The fact that the appellants wanted to complete all the formalities to avoid the Goods and Services Tax is not grounds for them to be held against. The court observed that the urgency shown by the appellants due to the introduction of GST was justified and natural. Avoidance of tax does not amount to evasion of tax.

The respondent company relied on the case of Ireo Grace Realtech Pvt. Ltd. v. Abhishek Khanna[5] to pray for the reduction of interest rates. The court observed that the facts of this case do not apply to the current scenario. In this case, the contract provided that any delay after the expiry of the grace period shall allow the other party to terminate the contract and obtain a refund without any interest. Hence, in all fairness, the court ordered a refund with a 9% p.a. simple interest. In the instant matter, it has been explicitly laid down in the contract that an interest of 12% p.a. has to be paid along with the refund. Thus, the court does not hold the authority to amend the same.

The court further held that the National Consumer Dispute Redressal Commission (NCDRC) exceeded its power and authority. The court not only amended the terms and conditions of the contract but also set out the discourse to be taken by both parties, especially the appellants. The appellant company wished to terminate the agreement despite the offer of possession made by the respondents on 29.07.2017. Accordingly, the court has directed the respondent company to refund the amount the appellants paid in twelve equal monthly instalments. Post-dated cheques and a simple interest of 12% p.a will be paid. The first instalment must be paid on the 5th of April and the remaining on the fifth of each month till it is fully repaid.

CONCLUSION

In this judgement, the court reversed the NCDRC’s order. This judgement is crucial for determining the duties and powers of the judges when dealing with contractual cases. The court referred to various judgements and reiterated that the court’s power is limited to understanding the contract and applying the terms and provisions to the facts presented. Even in cases wherein the contract is arbitrary, the court must not amend a valid contract. This judgment also serves as a reminder to the parties entering into contracts to carefully devise and review the terms and conditions of the contract since they cannot change the same unless expressly provided for in the contract. The parties must be aware that even the omission of a task mentioned in the contract shall lead to a breach enforceable by the aggrieved party.

Judgement analysis written by- Rashi Hora

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[1] AIR 1966 SC 1644

[2] (2013) 5 SCC 470

[3] (2020) 13 SCC 564

[4] (2023) 10 SCC 401

[5] 5 (2021) 3 SCC 241

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