SONIA ASSOCIATES Vs. B B SABHARWAL

JUDGEMENT

(1.) HAVING heard arguments on May 08, 2012 in RFA(OS) No.36/2011 which lays a challenge to the impugned judgment and decree dated January 14, 2011 as also in CM No.8376/2012 which is the Cross-Objection filed by the respondents challenging the same judgment and decree, we are deciding the appeal and the cross objection, noting at the outset that suit seeking specific performance of the agreement to sell Ex.P-1 dated June 20, 1997 has been disposed of under the impugned decree, denying relief of specific performance but granting damages in sum of RS.10,00,000/- (Rupees Ten lakhs) i.e. double the amount of the earnest money paid by the respondents to the appellant when agreement Ex.P-1 was executed.

(2.) AS per Ex.P-1, appellant Sonia ASsociates, the sole proprietary firm of Ms.Sonia Ahuja wife of Dinesh Ahuja had agreed to sell to the respondents the first floor with roof rights of the property bearing Municipal No.D-144, New Rajinder Nagar for a sale consideration of RS.40,00,000/- (Rupees Forty lakhs) and had received RS.5,00,000/- (Rupees Five lakhs) towards earnest money-cum-part sale consideration, requiring appellant to obtain the necessary No Objection Certificate from the Land & Development Office as also the necessary Income Tax clearance from the Income Tax Authorities within 15 days and thereafter requiring the respondents to tender the balance sale consideration and simultaneously the appellant executing the sale deed.

(3.) DEFENCE taken by the appellant was that the land comprising the subject property was a free-hold land and thus no sanction or permission was required from the Land & Development Office, and to said extent the requirement under Ex.P-1 to obtain a No Objection Certificate from the Land & Development Office was a surplusage. Pleading that simultaneous to the execution of Ex.P-1, on the same date i.e. June 20, 1997, another agreement was entered into by the appellant with the daughter of respondent No.1 under which appellant had to sell the basement of the property to the daughters of respondent No.1, it was pleaded that pursuant thereto a sale-deed was executed by the appellant on July 04, 1997 selling the basement to the daughters of respondent No.1 and at that time the respondents agreed to abandon their right under Ex.P-1 for a consideration of the appellant charging a lesser amount from the daughters of respondent No.1; meaningfully read, to mean that RS.5,00,000/- (Rupees Five lakhs) received by the appellant from the respondents under Ex.P-1 was adjusted against sale of the basement. Denying that the appellant received RS.15 lakhs from the respondents on any date, much less June 25, 1997, and further denying that the appellant invested said money to purchase the shop wherefrom business of M/s.Tilak Exclusif was being conducted, appellant pleaded that her husband was a tenant of the shop in question since the year 1984. Asserting that a decree for specific performance could not be passed in favour of the respondents, an alternative plea was taken: Since it was recorded in clause-4 of the agreement that failure of the appellant to execute the sale deed would entitle the respondents to a refund of the earnest money with penalty in same amount, at best the respondents would be entitled to refund of the earnest money and award of penalty i.e. only RS.10 lakhs.