GIAN CHAND Vs. YORK EXPORTS LTD

JUDGEMENT

(1.) THIS appeal by the defendant is directed against the judgment and decree dated 3rd October, 2005, passed by a learned Single Judge of this Court.

(2.) THE undisputed facts are that the plaintiff, M/s York Export Ltd., and the defendants entered into an agreement whereby the defendants agreed to sell and the plaintiff agreed to purchase 164 bighas 7 biswas of land owned by the defendants comprised in Khata Khatauni No. 98/105, Khasra No. 245, Mauza Beerh Plassi, Pargana Plassi, Tehsil Nalagarh, District Solan, H.P. This agreement was entered into between the parties on 02.08.1995 and the rate of the land was fixed at Rs. 50,000/ per bigha. Rupees two lac were paid as advance on 02.08.1995 itself and the agreement was reduced into writing. As per this agreement, the sale deed was to be got executed on or before 31.05.1996, but prior to that date, the plaintiff was required to pay a sum of Rs. 15,03,500/ to the defendants. Admittedly, this amount was also paid on 21.08.1995. However, the sale deed could not be executed by the plaintiff by 31.05.1996 because permission under Section 118 of the H.P. Tenancy and Land Reforms Act was granted to the plaintiff for purchase of only 125 bighas of land. Thereafter, the parties renewed the agreement on 31.05.1996. The renewed agreement was also reduced into writing. As per this renewed agreement, the plaintiff was to pay Rupees eighteen lac more, which it paid on 4th June, 1996. As per this agreement, the sale deed was to be got executed by 31.12.1996, if by then permission to purchase the land was granted. This second renewed agreement also contained a clause that in the event of permission not being granted by the aforesaid date, the plaintiff was to pay another sum of Rupees seven lac and the sale deed could be executed up to 31.05.1997. It was further agreed that in case the permission was not granted even up to 31.05.1997, the plaintiff would pay the balance sale consideration in its entirety.

(3.) ACCORDING to the plaintiff, it approached the defendants offering to make payment of Rupees seven lac as per the terms of the renewed agreement. However, the defendants refused to accept the said drafts. Thereafter, the plaintiff wrote a letter on 08.01.1996 that since the permission to purchase the entire land had not been accorded, the time for execution of the sale deed stood automatically extended up to 31.05.1997. The plaintiff expressed their willingness to pay the sum of Rupees seven lac. The defendants responded to this letter by their letter dated 16.01.1997 and alleged that the plaintiff had failed to get the sale deed executed by 31.12.1996 and, therefore, both the agreements for sale stood revoked. According to the plaintiff, it took all steps to obtain permission for purchase of the entire suit land, measuring 164 bighas and 7 biswas, but the Government granted permission to the plaintiff to purchase only 145 bighas of land. Therefore, according to the plaintiff, the agreement/contract stood frustrated and the plaintiff was entitled to refund of the entire amount paid by it, i.e. Rs. 35,03,500/ alongwith interest at the rate of 18% per annum.