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TMI Blog1999 (5) TMI 622X X X X Extracts X X X X X X X X Extracts X X X X ..... t or suffer to be erected on any part of the said demised premises any buildings other than and except the buildings erected thereon at the date of these presents. (6) The Lessee shall not without the written consent of the Lessor or such officer or body as he may authorise in this behalf construct any well of any description, or install any private system of supplying water whether for irrigation or for drinking. (7) The Lessee will not without such consent as aforesaid carry on or permit to be carried on the said premises any trade or business whatsoever or use the same or permit the same to be used for any purpose other than that of a single storey residential building for a private dwelling house for one or two families in all or do or suffer to be done thereon any act or thing whatsoever which in the opinion of the Lessor or such officer as he may authorise in this behalf may be an annoyance or disturbance to the President of India or his tenants in the New Capital of Delhi . xxx xxx xxx (13) The Lessee shall before any assignment or transfer of the said premises hereby demised or any part thereof obtain from the Lessor or such Officer or body as the Lessor may au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plans of multi-storeyed building as submitted by the respondents were passed and cleared for construction by N.D.M.C. and L. D.O. or earlier by mutual agreement and the balance amount of ₹ 5,72,740/- was to be paid after the completion of the said multi-storeyed building.There are a few relevant clauses of the agreement, material for the purpose of these appeals which are extracted and re-produced hereunder:- (3) That the purchaser shall get the permission for such a conveyance from the Land Development Officer and shall pay all the charges and expenses whatsoever, for execution and registration of the sale-deed, its stamping and the charges to the Land Development Office on account of unearned increase payable by the Seller for getting the necessary permission as provided in the perpetual lease dated 11th September, 1961. (4) That the purchaser shall have the building planned in their absolute discretion and after having the plans duly sanctioned construct and sell flats in the said building as per their terms and conditions without any let or hindrances from the seller any sort whatsoever. (6) That only after the payment of the consideration in full to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entary agreement, the parties agreed that instead of the balance consideration of ₹ 5,72,740/- being paid in cash, the respondent would give to the appellant flats on 2nd, 3rd and 4th floors measuring 8,182 sq. ft. at the rate of ₹ 70/- per sq.ft. valued at ₹ 5,72,740/-. The area of 8,182 sq. ft. could be reduced or increased by 5 to 6 percent at the discretion of the respondents. An amount of ₹ 50,000/- was paid by the respondents to the appellant on 25.7.72 simultaneously with the execution of the agreement. A post-dated cheque for a sum of ₹ 2,75,000/- was also delivered by the respondents to the appellant. Though this cheque was to be encashed by the appellant in terms of the agreement only after sanction of the building plans of the proposed multi-storeyed building by the local authority i.e. N.D.M.C. and the Land and Development Office, however, the cheque for the said amount of ₹ 2,75,000/- was encashed by the appellant though the building plans had not been sanctioned by the NDMC and L DO. As agreed, the appellant also executed an irrevocable Power of Attorney which was duly registered with the Sub- Registrar Delhi on 26th July, 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... On 22.11.73 the N.D.M.C. once again informed the respondents that the case for sanction of the building plans was considered by the NDMC on 21.9.1973 and the plans were rejected for the reasons annexed with the letter.The principal of the reasons was that the area was earmarked as re-development area in the master/zonal plan and further because the size of the plot was less than one acre whereas minimum size of the plot of group housing was required to be one acre. The master/zonal plan referred to by the NDMC was one approved by the Central Government under Section 9 (2) of the Delhi Development Act and hence having a statutory effect. Efforts were repeated for the sanction of the building plans but as is borne out from the communications dated 12.8.85 and 19.11.90 by the NDMC, building plans were not sanctioned and were only rejected. Sanction has however been granted on 4.6.1991 valid upto 29.4.1993 which is subject to about 13 conditions and provides that the sanction will be void ab initio if any of the auxiliary conditions mentioned therein were not complied with. The correspondence with the NDMC indicates that the NDMC was persuaded to grant such permission on account of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... later. 6. The plinth area of each dwelling unit in the building shall not exceed 300 sq.mtrs. 7. A person shall be entitled to own only one dwelling unit in this scheme. It is clarified that for the purpose of this clause a Company shall be deemed to be a person. xxx xxx xxx 9. No transfer/substitution of a dwelling unit shall be effected without obtaining prior approval of the Administrator of Delhi. For this purpose a list of intending buyers along with copies of the agreements executed or intended to be executed with the intending buyers and affidavits individually from them to the effect that he/she does not own any dwelling unit in any group housing scheme or a residential property or a house site or has a share in any joint ancestral property exceeding 80 sq.yds., either in his/her name or in the name of unmarried minor children in the Union Territory of Delhi shall be filed with the Secretary (L B) Delhi Administration, Delhi. Here itself, we may state that the agreement to sell entered into between the parties was incapable of being honoured in the light of the stringent terms and conditions subject to which the abovesaid permission was granted. In terms o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... q.mtr. The amount of compensation determined at the abovesaid rate along with the amount of solatium and interest was received by respondents. During the course of hearing our attention was drawn to a communication dated 17.6.1993 from L D.O. to the parties whereby the sanction for construction of multistoreyed group housing building on the suit premises offered to the respondents on 18.9.1992 has been withdrawn and cancelled on the ground of non-compliance with the terms and conditions of the sanction. Some controversy between the parties also centres around the fact whether possession over the suit property was handed over by the appellant to the respondents or not. The agreement to sell recites delivery of possession by the appellant to the respondents. The learned Trial Judge has recorded a finding that the recital in the agreement as to delivery of possession was not true and that the appellant had delivered possession of an area of 45 sq.yards merely to the respondents for the purpose of storing the material, on which area the respondents did raise some temporary structures; the physical possession was to be handed over after the necessary permissions/sanctions were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the property having been acquired for the purpose of road widening, the Land Acquisition Officer has estimated the value of the acquired property at ₹ 33,400/- per sq.mtr. Going by the standard adopted by the Land Acquisition Collector, which is always on the lower side, the value of the property had risen astronomically. If such circumstances taken together should the Court exercise its jurisdiction in favour of decreeing the specific performance? It is true that the agreement to sell dated 25th July, 1972 does not specifically provide for a time limit within which the agreement was to be performed or its performance secured. The Constitution Bench has held in the case of Smt. Chand Rani (dead) by LRs. vs. Smt. Kamal Rani (dead) by LRs. AIR 1993 SC 1742:-.lm15 .rm55 In the case of sale of immovable property there is no presumption as to time being the essence of the contract. Even if it is not of the essence of the contract the Court may infer that it is to be performed in a reasonable time if the conditions are : (1) from the express terms of the contract; (2) from the nature of the property; and (3) from the surrounding circumstances, for example: the obje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... legal notice dated 25.1.1979. Having emphasized the failure on the part of the respondents in securing sanctions/clearances and the insurmountable difficulty created in the way of the transfer by ULCRA, the appellant declared that the agreement had become void and unenforceable and hence respondents may vacate about 405 sq.ft. of the property in their possession within a period of two weeks failing which the appellant would be constrained to initiate legal proceedings. On 3.5.1979, the appellant filed a suit seeking a decree for a declaration that the agreement dated 25.7.1972 had become null and void and impossible of performance and a decree for delivery of possession of a portion of the land measuring about 45 sq.yards shown in the plan attached with the plaint. On 14.3.1980, the respondents filed a suit against the appellant seeking specific performance of the contract for sale, a mandatory injunction directing the appellant to handover vacant possession of the premises/part of the old building in possession of the appellant as described in the map and in the alternative to grant a decree for the refund of ₹ 3,25,000/- with interest calculated @ 18% p.a. and a decree ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssence of the contract ) should be decreed provided it is filed within the period of limitation notwithstanding the time-limits stipulated in the agreement for doing one or the other thing by one or the other party. That would amount to saying that the time-limits prescribed by the parties in the agreement have no significance or value and that they mean nothing. Would it be reasonable to say that because time is not made the essence of the contract, the time-limit (s) specified in the agreement have no relevance and can be ignored with impunity? It would also mean denying the discretion vested in the court by both Sections 10 and 20. As held by a Constitution Bench of this Court in Chand Rani vs. Kamal Rani (SCC p.528, para 25) ....it is clear that in the case of sale of immovable property there is no presumption as to time being the essence of the contract. Even if it is not of the essence of the contract, the Court may infer that it is to be the express terms of the contract; (2) from the nature of the property; and (3) from the surrounding circumstances, for example, the object of making the contract. In other words, the court should look at all the relevant circumstanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... knew it well that they were the respondents who were being depended on for securing such sanctions/clearances. Part of the land forming subject matter of the agreement was an excess land within the meaning of ULCRA and hence could not have been sold. Part of the land has been acquired by the State and to that extent the agreement has been rendered incapable of performance. The feasibility of a multi-storeyed complex as is proposed and planned by the respondents appears to be an impracticality. If the respondents would not be able to construct and deliver to the appellant some of the flats as contemplated by the novated agreement how and in what manner the remaining part of consideration shall be offered/paid by the respondents to the appellant is a question that defies answer on the material available on record. Added to all this is the factum of astronomical rise in the value of the land which none of the parties would have fore contemplated at the time of entering into the agreement. We are not in the least holding that the consideration agreed upon between the parties was inadequate on the date of the agreement. We are only noticing the subsequent event. Possession over a meagr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs from the date of the contract. Permission for constructing a multi-storeyed complex on the premises was refused time and again by the NDMC until the suit for specific performance came to be decreed by the Trial Court.On none of the two events either of the parties had any control. We are clearly of the opinion that at one point of time the contract had stood frustrated by reference to Section 56 of the Contract Act. We do not think that the subsequent events can be pressed into service for so reviving the contract as to decree its specific performance. The learned counsel for the respondents submitted that in spite of a part area of the property agreed to be transferred having been rendered inalienable by the owner on account of its having been acquired by the State and part of the property having been found to be inalienable on account of being in excess of the ceiling limit provided by ULCRA, the respondents were prepared to have a sale deed executed of such remaining part of the property as is available to be transferred without insisting on a corresponding reduction in the price agreed to be paid. The learned counsel for the respondents also submitted that the ULCRA havin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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