Regular Second Appeal No.4538 of 2009 1 In the High Court of Punjab and Haryana, at Chandigarh. Regular Second Appeal No.4538 of 2009 Date of Decision: 12.8.2011 Haryana Urban Development Authority, Faridabad and Another …Appellants Versus R.C. Gupta …Respondent CORAM: HON’BLE MR. JUSTICE KANWALJIT SINGH AHLUWALIA. Present: Mr. Manish Bansal, Advocate for the appellants. Mr. Manoj Bajaj, Advocate for the respondent. Kanwaljit Singh Ahluwalia, J. (Oral) The present regular second appeal has been filed by defendants to the suit. R.C.Gupta, plaintiff/respondent, through his general power of attorney Harish Gupta, filed a suit for declaration praying that the order of resumption bearing No. 8891 dated 11.1.2001, passed by appellant/defendant No.2-Estate Officer, Haryana Urban Development Authority, Sector 12, Faridabad, (hereinafter referred to as “the HUDA”) be set aside being null and void. A further prayer for issuance of permanent injunction was also made that the defendants be restrained from interfering in his peaceful possession over the suit property. The plaintiff had pleaded that he was allotted booth No. 65 Regular Second Appeal No.4538 of 2009 2 situated at Sector 8, Faridabad, in an open auction held on 15.11.1991 for a total sale consideration of ` 1,43,000. On the fall of hammer, the plaintiff had paid a sum of ` 14,300 as 10% of the total sale consideration and another 15% amount i.e. ` 21,450 was paid on 26.12.1991. The allotment letter was issued to the plaintiff on 16.11.1991. The remaining amount of total sale consideration was to be paid either in lump sum without any interest within a period of 60 days or in ten half yearly installments with 15% interest. It was further stated that after the payment of 25% of the sale consideration, the plaintiff had applied for delivery of possession of booth site on 26.12.1991. The case set out in the plaint is that the possession of booth was not delivered to the plaintiff. He had addressed several letters. Reliance was placed upon the allotment letter to show that the plaintiff was not liable to pay interest if the possession is not delivered. It was further stated that no development work had taken place in the area in view of letter dated 15.7.1992. A grievance was made that the defendants were not justified to demand penal interest and impose penalty upon the plaintiff without delivering possession of the booth in dispute. It was stated that on 19.3.1995, a letter was received wherein an offer to handover the possession was made to the plaintiff. The plaintiff approached the defendants for handing over the possession but the same was not delivered. Furthermore, the plaintiff was forced to pay a sum of ` 20,000 on 19.11.1996, another sum of ` 20,000 on 4.2.1997, ` 10,000 on 14.3.1997 and ` 60,000 on 2.9.1998. Thus, in all, the plaintiff had paid a sum of ` 1,45,750 against the original sale consideration of ` 1,43,000. Regular Second Appeal No.4538 of 2009 3 The case of plaintiff is that the possession was delivered on 3.9.1998, after a delay of 6 years and 10 months. Reliance was placed upon Clauses 5 and 6 of the allotment letter that interest would be paid only after the offer of possession and furthermore the plaintiff was only to take possession immediately after paying 15% of the sale consideration which was paid on 26.12.1991. It was further stated that wrongly the booth in dispute was resumed on 11.1.2001 and an appeal was filed by the plaintiff against the impugned resumption order. At that time, ` 3,20,250 was found outstanding against the plaintiff. The appeal, filed against the resumption order, was also dismissed. Therefore, the suit was filed praying that the appellants/defendants were not justified to raise demand of ` 3,20,250 and also charge compound interest and additional interest at the rate of 18% on the delayed instalment. Upon notice, the defendants had caused appearance. They raised preliminary objections that in view of Section 50(2) of the Haryana Urban Development Authority Act, 1977, the Civil Court had no jurisdiction to try the suit and the suit filed by the plaintiff is not maintainable as he had an alternative remedy. On merits, the defendants admitted the averments made in the plaint regarding non delivery of possession till 15.7.1992. However, it was stated that the plaintiff had failed to deposit the instalments and furthermore the development work was completed and the plaintiff was informed regarding it vide letter dated 10.2.1993. The possession was offered calling upon the plaintiff to deposit a sum of ` 40,560 due in respect of booth in question and only then the possession was to be delivered. It was further stated that instead of depositing the amount, the plaintiff Regular Second Appeal No.4538 of 2009 4 continued to raise a dispute that the defendants could not charge the interest. In paragraph 3 of the written statement, on merits, they denied the averments made by the plaintiff that the defendants had refused to handover the possession. It was further stated that since the amount of ` 3,20,250 was due, therefore, the resumption order was passed. After completion of the pleadings, the trial Court had drawn the following issues:- “1. Whether the order of resumption dated 11.1.2001 passed by defendant is null and void? OPP 2. Whether the plaintiff is entitled to the relief of permanent injunction? OPP 3. Whether the jurisdiction of this Court is barred u/s 50(2) of HUDA Act, 1977? OPD 4. Whether the suit is not maintainable? OPD 5. Whether the plaintiff has concealed the true and material facts? OPD 6. Whether the plaintiff has no cause of action to file the present suit? OPD 7. Relief.” The plaintiff examined Harish Gupta, General Power of Attorney, as PW.1, who had tendered into evidence his affidavit Ex.PW.1/A. Thereafter, the plaintiff had closed his evidence. He had also proved documents Ex.P1 to Ex.P12. The defendants examined Regular Second Appeal No.4538 of 2009 5 Kunwar Chand Rawat, Assistant, Office of Estate Officer, HUDA, as DW.1 and proved documents Ex.D1 to Ex.D15. The trial Court held that delivery of possession was offered for the first time on 31.3.1995. The Court further held that the plaintiff was always ready and willing to receive and accept the offer of possession which the defendants were under obligation to deliver to the plaintiff after the receipt of 25% of the total sale consideration. The Court further held that since on 3.9.1998 vide document Ex.P12 the plaintiff had already paid the entire amount of sale consideration in question, demand of balance amount is not justifiable as the resumption order Ex.D15 was passed on the basis of assumption that the plaintiff had failed to deposit the amount. Therefore, issues No.1 and 2 were decided against the defendants and in favour of the plaintiff. It was further held that the Civil Court had jurisdiction to try the civil suit. Issues No.4, to 6 were not pressed by the defendants, therefore, the same were decided in favour of the plaintiff. Aggrieved against the same, the present appellants filed an appeal in the lower Appellate Court. The lower Appellate Court while upholding the findings of the trial Court modified the decree to the extent that calculation of both the sides are not available on the record nor they can be readily available, therefore, if any amount is due, the same shall be paid by the allottee and the amount, which is payable, shall be informed by the appellants. I have heard Mr. Manish Bansal, Advocate, appearing for the appellants/defendants and Mr. Manoj Bajaj, Advocate, appearing for the respondent/plaintiff. The following substantial questions of law arise for Regular Second Appeal No.4538 of 2009 6 consideration of this Court:- 1) Whether due to delay in payment, resumption order can be sustained? 2) Whether the appellants/defendants are entitled to charge penal interest and penalty on the delayed payment in accordance with the terms & conditions of the allotment letter and statutory rules? What is important and material document on the record is Ex.P7 i.e. letter issued by the Estate Officer, Faridabad, to the Executive Officer, HUDA, Faridabad. This letter has been issued on 15.7.1992. Vide this letter, an information was sought from the Executive Officer, HUDA, Division No.1, to intimate as to whether the development work of Shopping Complex, Sector 8, has been completed and if not, by which date it would be completed. Furthermore, last line of Clause 5 of the allotment letter Ex.P2 specifically states that “the interest shall further accrue from the date of offer of possession”. Clause 6 of the allotment letter also states that “possession of the plot/building may be taken immediately after making payment of balance 15 amount as demanded in para 4 above”. Another document which cannot be ignored is Ex.D2, which is issued by the Estate Officer, HUDA Faridabad, to the allottee wherein it was specifically stated that ` 40,560 are due and the amount be remitted and possession be taken. Therefore, it is apparent that vide Ex.P7, the development work of the Shopping Centre had not been completed and possession could not be delivered on or before 15.7.1992. As per document Ex.D2, the allottee was called upon to take Regular Second Appeal No.4538 of 2009 7 possession on 10.2.1993. These facts were admitted in the pleadings by both the parties. A perusal of the plaint reveals that from 10.2.1993 when the possession was offered, remaining instalments were not paid, rather for the first time ` 20,000 was paid on 19.11.1996, another sum of ` 20,000 on 4.2.1997, ` 10,000 on 14.3.1997 and ` 60,000 on 2.9.1998. Thus, there is delay on the part of the allottee to pay the installments as per schedule of the allotment letter. This Court is in agreement with the finding returned by the lower Appellate Court that the resumption is very harsh measure and it should be resorted only when the allottee has no intention to pay the instalments. It seems that the allottee was disputing the rights of the appellants/defendants to charge interest as the development work had not been completed. It is also not disputed that by 2.9.1998, the allottee had paid ` 1,45,750. A period of more than decade is going to elapse. At this stage, to forfeit the amount and dispossess the allottee in view of the resumption order will cause unnecessary hardship to the allottee of the booth. This Court cannot become oblivious of the fact that the total area of booth is 27 square yards. Thus, the finding of both the Courts below that the resumption order is not sustainable, is upheld. However, it is held that as per terms & conditions of the allotment letter or the statutory rules, the appellants/defendants will be entitled to charge penal interest and impose penalty upon the plaintiff/respondent w.e.f. 10.2.1993 when the possession was offered vide Ex.D2. In view of the discussion held above, the present appeal is partly accepted and the decree of both the Courts below is modified to the extent that w.e.f. 10.2.1993 when the possession of the site was Regular Second Appeal No.4538 of 2009 8 offered vide Ex.D2, the appellants/defendants are entitled to charge penal interest and penalty in accordance with the terms & conditions of the allotment letter and statutory rules. A notice calling upon the allottee to deposit the amount in consonance with the observations made above shall be issued within a period of three months from the date of receipt of a certified copy of this order and the same shall be paid by the allottee within a period of three months thereafter. Till the date the payment is made, the allottee is liable to pay the interest and penal charges. With the modifications made above in the decrees of both the Courts below, the present appeal is disposed of. (Kanwaljit Singh Ahluwalia) Judge August 12, 2011 “DK”