NAR SINGH PRASAD Vs. SHAILENDER KUMAR MISHRA

JUDGEMENT

(1.) Exemption allowed subject to just exceptions. C.M. stands disposed of.

(2.) This Regular First Appeal under Section 96 of Code of Civil Procedure, 1908 (CPC) is filed by the defendant in the suit impugning the judgment of the Trial Court dated 19.5.2017 decreeing the suit for recovery of earnest money filed by the respondent/plaintiff. The suit has been decreed for the amount of Rs. 3 lacs along with interest at 8% per annum, and it is noted that the trial court has granted the relief of Rs. 6 lacs prayed in the suit of double the amount of earnest money of Rs. 3 lacs.

(3.) It is settled law from the Constitution Bench judgment of the Supreme Court in the case of Fateh Chand v. Balkishan Dass AIR 1963 SC 1405 and ratio of which has been recently reiterated by the Supreme Court in the case of Kailash Nath Associates v. Delhi Development Authority and Another, (2015) 4 SCC 136 that in the type of contracts which are in the nature of an agreement to sell, there cannot be forfeiture of the huge amount of earnest money unless and until loss is pleaded and proved to be caused to the affected/non-guilty party. The relevant paras of the judgment of the Supreme Court in the case of Kailash Nath Associates (supra) reads as under:-