UMA KAPOOR Vs. KAPIL AGGARWAL

JUDGEMENT

(1.) On October 04, 2005 a development agreement was executed in writing. Uma Kapoor and her son Vivek Kapoor were referred to therein as the first party and Kapil Aggarwal was referred to therein as the second party. As per the agreement, the first party was the owner of property bearing No.18, Road No.78, Punjabi Bagh, ad-measuring 550 sq.yds. As per the agreement, the second party had to demolish the existing building and reconstruct the same using his own funds. He had to pay Rs. 2,10,00,000/- (Rupees Two Crores Ten Lacs only) to the first party. After reconstruction, the ground floor was to belong to the first party. The first and the second floor with roof rights above were to belong to the second party. To facilitate the redevelopment the first party was to vacate the property within three months. The property had to be reconstructed by February 2007 or within sixteen months from the date when second party took over possession from the first party. A penalty of Rs. 25,000/- (Rupees Twenty Five Thousand only) per month for delayed construction was stipulated in the agreement.

(2.) The agreement records that the second party has paid Rs. 25,00,000/- (Rupees Twenty Five Lacs only) to the first party. It records that the balance sum of Rs. 1,85,00,000/- (Rupees One Crore Eighty Five Lacs only) shall be paid by the second party to the first party within three months from the date of execution of the agreement or when the sale-deed was executed by the first party in favour of the second party with respect to the first and the second floor, whichever was earlier. Parties are not at variance that the second party paid a further sum of Rs. 75,00,000/- (Rupees Seventy Five Lacs only) to the first party in different instalments, the last of which was in sum of Rs. 20,00,000/- (Rupees Twenty Lacs only) on February 22, 2006.

(3.) The redevelopment was a non-starter. The reason was that the plot of land was a part of a larger plot ad-measuring 2609 sq.yds and in a partition as per a compromise decree passed by this Court in a suit the 550 sq.yds land came to the share of the first party. Before reconstructing sanctions had to be obtained from the municipal authorities which require an existing unauthorized construction to be regularized before plans were sanctioned for reconstruction of the property and thereafter the existing structure was to be demolished. The unauthorized constructions in the building could be regularized only by May 17, 2007, by which date, the stipulated date of completion had become history. It was only thereafter the second party requested the first party to hand over possession of the existing building so that after demolishing the same he could reconstruct on the plot. The first party refused.