SANJAY SINGH AND ANR.versusCENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD.

856                       [2019]
               SUPREME COURT     5 S.C.R. 856
                              REPORTS                      [2019] 5 S.C.R.


A                        SANJAY SINGH AND ANR.
                                        v.
        CENTRAL HIMALAYAN LAND DEVELOPMENT CO. LTD.
                         (Civil Appeal No. 1928 of 2019)
B                            FEBRUARY 21, 2019
          [UDAY UMESH LALIT AND ASHOK BHUSHAN, JJ.]
             Suit – Recovery of money – Appellants booked a residential
      flat whereupon a villa was to be constructed by the respondent –
      Total consideration for villa was Rs.15,65,000/- – According to
C
      appellants they paid all the installments – Thereafter, appellants
      received demand notice from respondent for payment of balance
      consideration of Rs. 5,13,850/- towards principal sum and interest
      amounting to Rs.3,61,460/-, the total being Rs.8,73,556/- – Pursuant
      thereto, respondent filed a summary suit for recovery of the said
D     amount which was dismissed – In First appeal, High Court condoned
      the delay of 721 days and directed appellants to deposit Rs. 5,13,850/
      - in Court, and further directed respondent to handover the
      possession of the villa to appellant – However, High Court reversed
      its earlier order and directed to release the amount of Rs.5,13,850/
      - and the possession of villa back to respondent – On appeal held:
E
      There was no reason for the High Court to direct reversal of the
      situation – Further, there was no satisfactory explanation for
      condoning delay of 721 days – In the totality of circumstances,
      High Court erred in condoning delay – Thus, order of the High
      Court condoning delay set aside and consequently, first appeal also
F     dismissed – Besides that, possession of villa directed to continue in
      possession of the appellants and amount of Rs.5,13,850/- deposited
      in the Court to be made over to the respondent along with interest
      accrued – Delay/Laches.
            Allowing the appeal, the Court
G           HELD : 1. In the instant case, that the High Court in its
      order dated 16.04.2018 had sought to bring about a situation
      where the area of controversy could be minimized and at the same
      time the possession of the villa could be made over the appellant.
      Appellant was directed to deposit the balance sale consideration
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                                       856
SANJAY SINGH AND ANR. v. CENTRAL HIMALAYAN LAND                      857
              DEVELOPMENT CO. LTD.

of Rs.5,13,850/- in the Court and upon same being deposited,         A
the respondent-company to hand over the possession of the Villa.
The next order dated 23.05.2018 shows that the appellants had
deposited the sum as indicated and the possession was agreed
to be handed over by the respondent by 15.07.2018. The
possession of the villa was actually handed over. Thereafter, the
                                                                     B
matter came up before the High Court on 25.07.2018. The High
Court accepted the explanation for condonation of delay and
condoned the delay of 721 days, subject to payment of costs of
Rs.20,000/- to be made over by the respondent to the appellants.
The High Court also observed that subject suit since was filed
for recovery of money and the same was dismissed and the appeal      C
was against that decree, by an interim order the appellant cannot
receive possession of the disputed Villa constructed by
respondents. Further, High Court ordered to release the amount
deposited back to the respondents along with accrued interest.
In the circumstances, the question for consideration is whether
                                                                     D
the High Court was justified in reversing the situation. In terms
of the understanding between the parties as recorded in the
earlier orders of the High Court, there was no reason
for the High Court to direct reversal of the situation.
[Paras 11 and 14][862-BC; 861-A-E; 862-C-D]
      2. The delay to the tune of 721 days was condoned by the       E
High Court when there was no satisfactory explanation. There
was gross negligence on part of the respondent and the
explanation offered in support of the prayer for condonation does
not appear to be correct. Taking totality of the circumstances,
the delay ought not to have been condoned by the High Court.         F
Therefore, the submission of the appellants is accepted. The order
condoning delay is set aside. Consequently, the First Appeal
also stands dismissed. [Para 15][862-D-E; F-G]
      3. However, considering the developments that have taken
place while the appeal was pending in the High Court, it is          G
directed: a) The possession of the villa which was handed over
to the appellants in pursuance of the order dated 23.05.2018 shall
continue to remain with the appellants and be taken to be in terms
of the Agreement entered into between the parties; b) The
amount of Rs.5,13,850/- deposited by the appellants in the
                                                                     H
858            SUPREME COURT REPORTS                          [2019] 5 S.C.R.


A     Registry of the High Court which stands converted into a Fixed
      Deposit Receipt, upon maturity shall be made over to the
      respondent along with interest accrued thereon; c) The pending
      appeal before the State Commission shall be dealt with on its
      own merits. [Para 16][862-G-H; 863-A-B]
B           CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1928
      of 2019.
            From the Judgment and Order dated 25.07.2018 of the High
      Court of Delhi at New Delhi in Regular First Appeal No. 876 of 2016.
            Rajan K. Chourasia, Adv. for the Appellants.
C
           Rajat Sehgal, Ms. Ritagya Riti Singh, Praveen Rao, Ms. Vandana
      Anand, Advs. for the Respondent.
            The Judgment of the Court was delivered by
            UDAY UMESH LALIT, J. 1. Leave granted.
D
             2. This appeal is directed against the judgment and order dated
      25.07.2018 passed by the High Court of Delhi at New Delhi in Regular
      First Appeal No.876 of 2016.3
             3. The appellants had booked a residential plot whereupon a villa
      was to be constructed by the respondent in a project called “Cloud-9 Hill
E
      Town” in village Khabrar, Ramgarh, District-Nainital, Uttarakhand. An
      agreement in that behalf was executed on 14.04.2004 in terms of which
      the total consideration for the villa was Rs.15,65,000/- and the villa was
      to be completed within 30 months. Later, sale deed in respect of the plot
      was registered in favour of the appellants on 14.05.2004. According to
F     the appellants they had secured loan to the tune of Rs.13,30,000/- from
      a bank and had paid all the instalments as and when they were due. On
      or about 03.10.2007 the appellants received a demand notice for payment
      of balance consideration of Rs.5,13,850/- together with interest @ 24%.
      The amount of Rs.5,13,850/-was tendered by the appellants on 12.10.2007
      but the cheque was returned by the respondent.
G
            4. Thereafter, a statement of accounts was prepared
      by the respondent which reflected outstanding dues to the
      tune of Rs.5,13,850/- towards principal sum and interest amounting to
      Rs.3,61,460/-, the total being Rs.8,73,556/-. Soon thereafter, the
      respondent filed a Summary Suit for recovery of said amount of
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SANJAY SINGH AND ANR. v. CENTRAL HIMALAYAN LAND                                859
   DEVELOPMENT CO. LTD. [UDAY UMESH LALIT, J.]

Rs.8,73,556/-. The Suit was registered as CS No.431/14/2008 on the             A
file of Additional District Judge, Tis Hazari, New Delhi.
      5. A Consumer Complaint was filed by the appellants
being CC/110/2008 against the respondent submitting that though the
outstanding amount was tendered by the appellants on 18.10.2007, the
respondent refused to accept the same unless the principal sum was             B
accompanied with interest @ 24% and that the project was not completed
in time as a result of which the appellants were put to loss. It was
prayed that the respondent be asked to deliver possession of villa along
with all the facilities and accept the balance payment of Rs.5,13,850/-.
The respondent contested the claim and submitted that the appellants
never paid instalments as per schedule; that there was no delay on part        C
of the respondent; and, therefore, the respondent was justified in
demanding interest.
       6. The complaint was allowed by District Forum-II, New Delhi
by order dated 29.04.2010 which directed the respondent to deliver the
completed villa to the appellants against the balance payment of               D
Rs.5,13,850/- without any interest and further directed the respondent to
pay compensation to the tune of Rs.1,00,000/- to the appellants. The
order passed by the District Forum-II is presently pending appeal before
the State Commission, New Delhi.
        7. The Civil Suit filed by the respondent was dismissed by             E
Additional District Judge-15 (Central), Tis Hazari Courts, Delhi by his
judgment and order dated 30.07.2014. The principal issue framed was
whether the respondent was entitled to recovery of Rs.8,73,556/- as
alleged? The case put up by the respondent was not accepted by the
trial court and rejecting all the contentions of the respondent the suit was   F
dismissed.
       8. The respondent being aggrieved filed Regular First Appeal
No.876 of 2016 in the High Court with an application to condone the
delay of 721 days in filing said appeal. The explanation offered in support
of condonation of delay was that the then advocate had not informed the        G
respondent about the disposal of suit; that the respondent was, therefore,
constrained to lodge a complaint against said advocate before the Bar
Council of Delhi, which was pending adjudication and that the respondent
ought not to suffer on account of the failure on part of their advocate.
The appeal came up before the High Court on 16.04.2018. After going
into the rival contentions, the High Court observed:                           H
860             SUPREME COURT REPORTS                           [2019] 5 S.C.R.


A           “Considering the facts and circumstances of this case, as recorded
            in the previous orders, where only some part of the total
            consideration is due and that too the same was tendered by the
            Respondents but was not accepted by the Appellant Company, it
            is directed that the balance sale consideration of Rs.5,13,850/-,
            shall be deposited by the Respondents in this Court within a period
B
            of four weeks. Upon the same being deposited, the Appellant
            Company shall hand over the possession of the Villa for the peaceful
            occupation and enjoyment of the Respondents. The Appellant
            Company shall ensure that the Villa would be in liveable condition
            and shall be complete in all respects.
C           Considering the allegations made against the Company and the
            status report, which has been handed over by the police station
            Amar Colony, it is directed that a responsible person from the
            management of the Appellant Company shall remain present in
            the Court on the next date of hearing.
D           The question, as to whether the Appellant Company is entitled to
            interest due to the alleged delay in payment of the principal sum,
            shall be decided at the time of final hearing of the appeal. Original
            status report is taken on record.
            List on 23rd May, 2018 for final hearing. Trial court record be
E           requisitioned for the next date of hearing.”
            9. The matter was, thereafter, taken up by the High Court on
      23.05.2018 when it was observed:
            “The Respondent is stated to have deposited the money as directed
F           on the last date, with the Registrar General of this Court. The
            amount shall be kept in a FDR on automatic renewal mode. The
            possession of the villa has not yet been given by the Appellant.
            They undertake that the possession of the fully completed villa
            shall be handed over to the Respondents on 15th July, 2018.”
             10. As per record, the amount of Rs.5,13,850/- which was stated
G
      to be balance payable towards the principal sum, was deposited by the
      appellants with the Registry of the High Court. The amount was,
      thereafter, converted into a Fixed Deposit Receipt awaiting final directions
      in the matter. According to the order dated 23.05.2018, it was undertaken

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SANJAY SINGH AND ANR. v. CENTRAL HIMALAYAN LAND                                 861
   DEVELOPMENT CO. LTD. [UDAY UMESH LALIT, J.]

by the respondent that the villa would be handed over and the possession        A
of the villa was accordingly handed over to the appellants.
       11. Thereafter, the matter came up before the High Court on
25.07.2018. The High Court accepted the explanation for condonation
of delay and condoned the delay of 721 days, subject to payment of
costs of Rs.20,000/- to be made over by the respondent to the appellants.       B
The High Court also observed:-
      “6. The subject suit was a suit for recovery of moneys filed by the
      appellant/plaintiff. For the settlement, the appellant/plaintiff was
      directed to hand over the villa constructed for the benefit of the
      respondents/defendants pursuant to an interim order passed by a           C
      learned Single Judge of this Court and whereby respondents also
      deposited a sum of Rs.5,00,000/- in this Court. There cannot be
      an interim order in a proceeding which is beyond the scope of
      main proceedings. The subject suit since was a suit filed by the
      plaintiff for recovery of moneys which has been dismissed and
      the present appeal is against that decree, by an interim order the        D
      respondents cannot receive possession of the disputed flat/villa
      constructed by the appellant in Cloud-9, Hill Town, Village Khabrar,
      Ram Garh, District Nainital, Uttarakhand. Therefore, it is ordered
      that the amount deposited by the respondents in this Court be
      released back to the respondents along with accrued interest              E
      thereon within a period of four weeks from today and
      simultaneously or before the respondents will hand over possession
      back of the subject villa received by the respondents from the
      appellant pursuant to interim orders in this appeal to the appellants.”
        The First Appeal was admitted and directed to be listed in due          F
course as per the year of its seniority.
     12. The aforesaid order dated 25.07.2018 is now under challenge.
While issuing notice, this Court had stayed the operation of said order.
       13. We have perused the record and considered rival submissions
advanced by learned counsel for both the sides. The following features          G
are clear:-
      a) The balance sum of Rs.5,13,850/- which was supposed to be
      due from the appellants was deposited by the appellants.

                                                                                H
862             SUPREME COURT REPORTS                           [2019] 5 S.C.R.


A           b) In terms of the order dated 23.05.2018 the amount so deposited
            stands converted into a Fixed Deposit Receipt.
            c) In terms of the order dated 23.05.2018 and as undertaken by
            the respondent, possession of the villa was made over to the
            appellants.
B             14. In the instant case, that the High Court in its order dated
      16.04.2018 had sought to bring about a situation where the area of
      controversy could be minimized and at the same time the possession of
      the villa could be made over the appellant. The next order dated 23.05.2018
      shows that the appellants had deposited the sum as indicated and the
C     possession was agreed to be handed over by the respondent by
      15.07.2018. The possession of the villa was actually handed over. In
      the circumstances, the question for our consideration is whether the
      High Court was justified in reversing the situation. According to us, the
      situation having been brought about in terms of the understanding between
      the parties as recorded in the earlier orders of the High Court, there was
D     no reason for the High Court to direct reversal of the situation.
             15. But, what is more striking is that the delay to the tune of 721
      days was condoned by the High Court when there was no satisfactory
      explanation. In our view, there was gross negligence on part of the
      respondent and the explanation offered in support of the prayer for
E     condonation does not appear to be correct. This is evident from the fact
      that no effective steps were taken to pursue the complaint which was
      lodged against the then advocate. In the petition for special leave, it was
      asserted that the complaint against the Advocate was not being proceeded
      with and the respondent had remained absent on the relevant date. Said
F     assertion was not answered satisfactorily in the affidavit in reply filed in
      this Court. Taking totality of the circumstances, in our view the delay
      ought not to have been condoned by the High Court. We, therefore,
      accept the submission of the appellants and set aside the order condoning
      delay. Consequently, the First Appeal also stands dismissed.

G            16. However, considering the developments that have taken place
      while the appeal was pending in the High Court, we pass following
      directions:-
            a) The possession of the villa which was handed over to the
            appellants in pursuance of the order dated 23.05.2018 shall continue
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SANJAY SINGH AND ANR. v. CENTRAL HIMALAYAN LAND                               863
   DEVELOPMENT CO. LTD. [UDAY UMESH LALIT, J.]

      to remain with the appellants and be taken to be in terms of the        A
      Agreement entered into between the parties.
      b) The amount of Rs.5,13,850/- deposited by the appellants in the
      Registry of the High Court which stands converted into a Fixed
      Deposit Receipt, upon maturity shall be made over to the
      respondent along with interest accrued thereon.                         B
      c) The pending appeal before the State Commission shall be dealt
      with on its own merits.
      17. With the aforesaid directions this appeal is allowed. No costs.

                                                                              C
Ankit Gyan                                                  Appeal allowed.




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