IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 13.12.2011 CORAM THE HON'BLE MR. JUSTICE VINOD K. SHARMA A.No.5528 / 2011 in E.P.193 / 2004 in C.S.1370 / 1993, A.5529 / 2011 in E.P.194 / 2004 in C.S.1338 / 1992 & A.5530/2011 in E.P.20 / 1996 in C.S.No.1126 of 1993 ORDER This order shall dispose off A.Nos.5528 to 5530 of 2011, as the common question of law and facts, are raised in these applications. 2. The plaintiffs / applicants have filed these applications for extension of time to perform, the obligations under the compromise decree dated 30.09.1993. 3. The first plaintiff is a registered Firm. Whereas other two plaintiffs, are the companies, registered under the Companies Act. 4. The respondents/ defendants had entered into agreement dated 22.04.1987 for purchase of undivided share in the land, described in Schedule A and B of the agreement, as also for purchase of built up office / shops. 5. The plaintiffs admittedly could not hand over the possession of property, agreed to be purchased by defendants. The defendants / respondents filed a complaint in the consumer Court, alleging deficiency in service. 6. Whereas, the plaintiffs filed a suit for declaration that the contract entered into with the defendants stood extinguished by cancellation, therefore, defendants were not entitled to enforcement of the contract entered into between the parties. 7. Consequential, relief was also prayed, for restraining defendants from enforcement of the contract in any manner whatsoever, the object being to stall proceedings in consumer court. 8. During the pendency of the suit, the parties entered into settlement, which resulted in passing of a consent decree dated 13.09.1993. 9. The terms of the decree passed reads as under: "It is interms thereof ordered and decreed as follows: (i) That the Plaintiff herein shall complete in all respects the Shopping Cum Office Complex known as Gemini Towers formerly known as 'The City Centre Point' under construction at No.601, Mount Road, Madras 600 006, within a period of 18 months from this date; (ii) That the Plaintiffs hereins hall hand over within a period of 18 months from this date the office space construction to eb built for the defendant under Builders Agreement dated 22.04.1987 with all the amenities stated therein like water, electricity etc and further amenities inclusive of the additional amenities etc., a) Face lift in the front of the building viz., "Gemini Towers", by adopting a new elevation and outer facade. b) Improvement of main entry to the building from Gopathy Narayanasamy Chetty Road, by providing a grant entrance and a circular road around the building of Gemini Towers. c) Entrance Lobby in the Ground Floor to be widened. d) In the lobby, interior decoration to be done. e) Landscaping to be done around the building between the car parks and also in front of the building based on Architect's recommendations. f) in all the common areas inside the complex and the Shop / Office areas , white mosaic flooring to be provided. g) Adequate power supply to be ensured by designing the panels and the transformers to the required load, taking into consideration that every unit will have air conditioning. h) in the toilet, white spartek or equivalent tiles to be used instead of ordinary glazed tiles. i) If the Madras Telephones sanctions the scheme for installing a local exchange in the building, the plaintiffs have agreed to provide a minimum of one Telephone tot he Defendant / Shop / Office on actual costs incurred by the Plaintiffs, subject again to the Telephone Department making available necessary lines: (iii) That on completion of the office space for the defendant the Plaintiff herein shall issue a notice in writing by Registered Post with acknowledgment due to the last known address of the defendant, unless the change of address has been communicated to the Plaintiff by the defendant in writing, intimating the defendant that the plaintiffs herein are ready to put the defendant in possession; (iv) That the Defendant herein shall pay the balance of Rs.99,000/- (Rupees Ninety nine thousand only) payable to the plaintiffs under the builders agreement dated 22.04.1987 within 30 days from the date of receipt of such notice as mentioned in clause 2 supra and that the plaintiff herein, shall forthwith put the defendant in possession of the office space as mentioned in clause (2) supra and also execute and register the necessary deed of sale of undivided interest in land as contemplated under the Builders agreement dated 22.04.1987; (v) That in default of payment by the defendant herein of the said balance and take possession of the space within 30 days of receipt of the notice and mentioned in clause (4) supra the builders agreement dated 22.4.1987 shall stand cancelled and the deed of sale in favour of the defendant shall become null and void and that thereafter the plaintiffs shall be entitled to register a deed of cancellation after paying back the actual amounts paid by the defendant under the said agreement dated 22.4.1987 together with interest thereon at the rate of 10% per annum; (vi) That the Defendant herein shall pay escalated cost at the rate of Rs.130.00 (Rupees one hundred and thirty only) per sq.ft. of constructed area (which rate includes cost of additional amenities) within a period of six months from the date of possession and to ensure such payment the builders agreement dated 22.4.1987 as well as the deed of sale executed and Registered in favour of the defendant herein shall be kept in deposit with the plaintiff by the defendant as security for such payment and that if the defendants fails to make the payment within the said period the builders agreement dated 22.4.1987 shall stand cancelled and the deed of sale in favour of the defendant shall become null and void and thereafter the plaintiff shall be entitled to register a deed of cancellation after paying back the actual amount paid by the defendant under the builders agreement dated 22.4.1987 together with interest thereon at the rate of 12% p.a. (vii) That the defendant of handing over of the possession by the plaintiff herein within 18 months period as mentioned in clause (1) Supra the Plaintiff shall be liable to pay interest at the rate of 24% per annum on Rs.2,41,000/- (Rupees Two Lakhs forty One thousand only) paid by the defendant under the builders agreement dated 22.4.1987 from the date of expiry of the 18th month period till date of delivery and that if delivery is delayed beyond 24 months from this date, then the builders agreement shall be deemed cancelled and the plaintiff shall be liable to refund the sum of Rs.2,41,000/- (Rupees Two Lakhs and forty one thousand only) paid by the defendant under the builders agreement dated 22.4.1987 together with interest thereon at the rate of 24% per annum with quarterly rests from the date of payments made by the defendants viz. 1.on Rs.15,000/- from 23.3.1987 2.on Rs.1,00,000/- from 22.4.1987 3.on Rs.14,000/- from 1.6.1987 4.on Rs.14,000/- from 30.6.1987 5.on Rs.14,000/- from 30.7.1987 6.on Rs.14,000/- from 31.8.1987 7.on Rs.14,000/- from 25.9.1987 8.on Rs.14,000/- from 2.11.1987 9.on Rs.14,000/- from 30.11.1987 10.on Rs.14,000/- from 23.12.1987 11.on Rs.14,000/- from 28.1.1988 till date of payment by the Plaintiffs in full and till such payment is made in full there shall be a charge on the land and building known as Gemini Towers in favour of the defendant. (viii) That the defendant herein shall not object to the plaintiff constructing upto a maximum of 7 additional floors over and above the existing basement, ground plus 3 floors provided the plaintiffs obtain requisite sanction. (ix) That the plaintiff and the defendant shall withdraw all other proceedings instituted by either of them in respect of the builders agreement dated 22.4.1987; (x) That there be no to costs, if the Plaintiff Company with clauses (1) and (2) of Supra, and that if delivery is delayed beyond 24 months from this date rendering the Plaintiff liable to refund amounts as specified Clause (7) Supra, the Plaintiffs herein shall pay to the Defendant herein, the costs of this suit as and when taxed by the taxing officer of this Court and noted in the margin hereof; SCHEDULE 'A' All those piece and parcel of land measuring about 1 Ground and 9536 sq.ft out of 16 Grounds 0311 Sq.ft or thereabouts in R.S.No.3/1 Part of Block No.1 Mylapore, bearing Door No.596 and 601 Anna Salai, Madras-600 006 within the Sub-Registration District of Thousand Lights, bounded on the North by R.S.No.3/1 and 3/8, East by R.S.No.3/11, South by R.S.No.3/10, and West by R.S.No.3/1 Part. SCHEDULE 'B' All those piece and parcel of land measuring about 13 Grounds 1804 sq.ft or thereabouts situate in R.S.No.3/1 Part, Block No.1 Mylapore, bearing Door No.598 Anna Salai, Madras-600 006 within the Sub-Registration District of Thousand Lights, bounded on the North-East by R.S.No.3/1 Part, North- East by Road leading from Nungambakkam High Road, and Southeast by R.S.No.3/10 and Southwest by property R.S.No.3/4 Part. SCHEDULE 'C' An undivided 142.01/50400 share in all that piece and parcel of land described in 'A' & 'B'. SCHEDULE 'D' Shop/Office No."L" in South wing in the I Floor of the Shopping Cum-Office Complex known as THE CITY CENTRE POINT measuring about 572 sq.ft. of built up area (including proportionate share of common area in the particular floor). SCHEDULE 'E' MEMORANDUM OF COMPROMISE FILED UNDER ORDER XXIII RULE 3 OF THE C.P.C. The Plaintiffs and the Defendant have compromised their differences and have arrived at the following terms of settlement and pray that this Honourable Court may be pleased to pass a decree as follows: 1. The Plaintiffs undertake to complete in all respects the Shopping Cum Office Complex to be known as 'Gemini Towers' formerly to be known as "The City Centre Point" under Construction at No.601, Mount Road, Madras-600 006 within a period of 18 months from the date of the decree. 2. The Plaintiffs undertake to hand over the Office space constructed to be built for the Defendant under builders agreement dated 22.4.1987 with all amenities stated thereinlike water, electricity etc. and further amenities inclusive of the following amenities viz., a) Face lift in the front of the building viz., "Gemini Towers", by adopting a new elevation and outer facade. b) Improvement of main entry to the building from Gopathy Narayanasamy Chetty Road by providing a grand entrance and a circular road around the building of Gemini Towers. c) Entrance lobby in the Ground Floor to be widened. d) In the lobby, interior decoration to be done. e) Lanscaping to be done around the building between the car parks and also in front of the builders based on Architect's recommendations. f) In all the common areas inside the complex and the shop / office areas, white mosaic flooring to be provided. g) Adequate power supply to be ensured by designing the panels and the transformer to the required load, taking into consideration that every unit will have air conditioning. h) In the toilet, white spartek or equivalent tiles to be used instead of ordinary glazed tiles. f) If the Madras Telephones sanctions the scheme for installing a local exchange in the building the plaintiffs have agreed to provide a minimum of one Telephone to the defendant Shop / Office on actual costs incurred by the Plaintiffs, subject again to the Telephone Department making available necessary lines within a period of 18 months from the date of the decree. 3. On completion of the office space for the defendant, the plaintiffs shall issue a notice in writing by Registered Post with acknowledgment due to the last known address of the Defendant, unless the change of address has been communicated to the Plaintiffs by the Defendant in writing, intimating the Defendant that the Plaintiffs are ready to put the Defendant in possession. Within 30 days from the date of receipt of such notice the Defendant shall pay the balance of Rs.99,000/- payable to the Plaintiffs under the Builders Agreement dated 22.4.1987 and the Plaintiffs shall forthwith put the Defendant in possession of the office space as contemplated under clause 2 of the decree and that Plaintiffs shall also execute and register the necessary deed of sale of undivided interest in land as contemplated under the Railways Agreement dated 22.4.1987. I the Defendant does not tender the balance and take possession within 30 days of receipt of the notice there the builders agreement dated 22.4.1987 shall stand cancelled and the Deed of Sale in favour of the Defendant shall become null and void. Thereafter, the Plaintiffs shall be entitled to register a Deed of Cancellation after paying back the actual amounts paid by the Defendant under the Builders agreement dated 22.4.1987 together with interest thereon at the rate of 10% per annum. 4. The Defendant shall pay the escalated cost at the rate of Rs.130.00 per sq.ft of constructed area (which rate includes cost of additional amenities) within a period of six months from the date of possession. To ensure such payment, the builders Agreement dated 22.4.1987 as well as the Deed of Execution and registered in favour of the Defendant shall be deposit with the Plaintiff by the Defendant as security for such payment. If the Defendant failed to make the payment within the said period the Builders Agreement dated 22.4.1987 shall stand cancelled and the Deed of sale in favour of the Defendant shall become null and void. Thereafter, the Plaintiffs shall be entitled to Register a Deed of Cancellation after paying back the actual amounts paid by the Defendant under the Builder's Agreement dated 22.4.1987 together with interest thereon at the rate of 12% per annum. 5. In the event that possession is not handed over by the Plaintiffs within the 18th months period stipulated, then the Plaintiffs shall be liable to pay interest at the rate of 24% per annum on Rs.2,41,000/- paid by the Defendant under the Builders Agreement dated 22.4.1987 from the date of expiry of the 18th month period till date of delivery and if the delivery is delayed beyond 24 months from the date of decree then the Builders Agreement shall be deemed cancelled and the Plaintiffs will be liable to refund the sum of Rs.2,41,000/- paid by the Defendant under the Builders Agreement dated 22.4.1987 together with interest thereon at the rate of 24% per annum with quarterly rests from the date of payments made by the Defendant viz., 1.On Rs.15,000/- from 23.3.1987. 2.On Rs.1,00,000 from 22.4.1987 3.On Rs.14,000/- from 1.6.1987 4.On Rs.14,000/- from 30.6.1987 5.On Rs.14,000/- from 30.7.1987 6.On Rs.14,000/- from 31.8.1987 7.On Rs.14,000/- from 25.9.1987 8.On Rs.14,000/- from 2.11.1987 9.On Rs.14,000/- from 30.11.1987 10.On Rs.14,000/- from 23.12.1987 11.On Rs.14,000/- from 38.1.1988 till date of payment by the Plaintiffs in full and till such payment is made in full there shall be a change on the land and building known as Gemini Tower in favour of the Defendant. 6. The Defendant agrees not to object to the Plaintiffs constructing upto a maximum of 7 additional floors over and above the existing basement, ground plus 3 floors provided the Plaintiffs obtained requisite sancticn. 7. The Plaintiffs and Defendants hereby agree to withdraw all other proceedings instituted by either of them in respect of the Builders Agreement dated 22.4.1987. 8. Neither party shall be entitled to costs if the Plaintiffs comply with clauses 1 and 2 of the Decree but the Plaintiffs shall be liable to pay costs of the Defendant if delivery is delayed beyond 24 months from the date of decree rendering the Plaintiff liable to refund amounts as specified in clause 5 of the Decree. Dated at Madras this 11th day of September, 1993." Similar decrees were passed in all three suits. 10. It is not disputed that the plaintiffs failed to comply with the terms of the decree, and failed to hand over the possession of the property agreed to be purchased by defendants within the period stipulated, under the compromise decree, which resulted in cancellation of agreement, and obligation on the plaintiffs / applicants to pay the amount with compound interest in terms of consent decree. The clause reads as under: "(vii) That the defendant of handing over of the possession by the plaintiff herein within 18 months period as mentioned in clause (1) Supra the Plaintiff shall be liable to pay interest at the rate of 24% per annum on Rs.2,41,000/- (Rupees Two Lakhs forty One thousand only) paid by the defendant under the builders agreement dated 22.4.1987 from the date of expiry of the 18th month period till date of delivery and that if delivery is delayed beyond 24 months from this date, then the builders agreement shall be deemed cancelled and the plaintiff shall be liable to refund the sum of Rs.2,41,000/- (Rupees Two Lakhs and forty one thousand only) paid by the defendant under the builders agreement dated 22.4.1987 together with interest thereon at the rate of 24% per annum with quarterly rests from the date of payments made by the defendants viz. 1.on Rs.15,000/- from 23.3.1987 2.on Rs.1,00,000/- from 22.4.1987 3.on Rs.14,000/- from 1.6.1987 4.on Rs.14,000/- from 30.6.1987 5.on Rs.14,000/- from 30.7.1987 6.on Rs.14,000/- from 31.8.1987 7.on Rs.14,000/- from 25.9.1987 8.on Rs.14,000/- from 2.11.1987 9.on Rs.14,000/- from 30.11.1987 10.on Rs.14,000/- from 23.12.1987 11.on Rs.14,000/- from 28.1.1988 till date of payment by the Plaintiffs in full and till such payment is made in full there shall be a charge on the land and building known as Gemini Towers in favour of the defendant." 11. In view of cancellation of the agreement between the parties, in terms of the decree, defendants / non applicants filed execution petition, in this Court for recovery of the amount under the consent decree. The Learned Master, in order to execute decree, ordered attachment and auction of property of the plaintiffs. 12. The order is challenged by plaintiffs / applicants in this Court along with an application for condonation of delay. This Court allowed the condonation application, subject to payment of Rs.1,00,00,000/- (Rupees One Crore only) to each of the defendants, representing part payment of decretal amount, which admittedly stands paid. 13. Before the application could be taken up for hearing, the plaintiffs / applicants, have filed the present applications for extension of time to perform the terms of the compromise decree to complete the construction, and hand over possession to the respondents, pending the disposal of the execution petition and pass such further or other orders, which this Hon'ble Court may deem fit, in the facts and circumstances of the case. 14. In the applications, it is pleaded that the project / construction was progressing well, when the Government suddenly issued a show cause notice, to cancel the G.O.Ms.No.1729 Housing and Urban Development dated 16.11.1987, vide Letter No.26534/U D1(1)/89-1 dated 28.04.1989, alleging certain violation of the Development Control Rules. 15. The applicants / plaintiffs submitted reply to the show cause notice followed by further representations, including representation to the Hon'ble Chief Minister. 16. It is also pleaded that there underwent a change of constitution of the applicants' management and, the new Board of Directors felt that no useful purpose was going to be served by continuing the project, in view of the show cause notice to cancel the G.O.Ms.No.1729 Housing and Urban Development dated 16.11.1987, issued to the applicants. 17. The applicants, accordingly, invoked Clause-18, of the Agreement, to cancel the contract, on the ground of "impossibility" to perform the contract. 18. The notice issued by the applicants / plaintiffs, was challenged by defendants, before the Consumer District Redressal Forum on ground of deficiency of service. 19. It is case of the applicants itself that it was in order to overcome pending proceedings, that Civil Suits were filed in this Court, to seek cancellation of agreement. The management also approached the Government of Tamil Nadu, with fresh proposal for development of the property in multistoried building. 20. As noticed, suits filed by the plaintiffs were compromised, and a compromise decree was passed, as detailed above. 21. The applicants / plaintiffs now seek extension of time to perform its part of contract, on the ground that sanction granted to the applicants / plaintiffs was cancelled by the Government of Tamil Nadu on 28.02.1995, which resulted in stoppage of work. 22. It is also pleaded by applicants / plaintiffs, that order of cancellation of planning permission was challenged by applicants / plaintiffs by way of writ petition, which was allowed on 22.04.2008, by directing the authorities to consider the representations filed by plaintiffs / applicants. 23. The representations of applicants / plaintiffs were again rejected by the State Government, against which applicants have filed an appeal, with the State Government, which is yet to be disposed off. 24. The contention of the learned senior counsel for the applicants / plaintiffs, is that it was on account of reasons beyond control of the applicants / plaintiffs that applicants were not able to complete the construction, and hand over the possession of the property agreed to be sold to defendants. 25. It is also the contention of the learned senior counsel for the applicants, that it is defendants / respondents, who have violated the terms of compromise decree by not accepting the offer, of handing over the constructed property, within reasonable time, by taking a stand that the contract no longer existed as per compromise decree and by insisting to enforce the money decree, as per the consent decree, passed by this Court. 26. In support of the contention, that the applicants / plaintiffs are entitled to extension of time, learned Senior Counsel placed reliance on the judgment of the Hon'ble Supreme Court in the case of Smt.Periyakkal and others vs. Smt.Dakshyani, (1983) 2 SCC 127, wherein the Hon'ble Supreme Court was pleased to lay down as under: "4. In the case before us, the situation Is totally different. Unlike the case of Hukam Chand v. Bansilal where there was a statuory compulsion to confirm the sale on the dismissal OF the application under order XXI Rule 90 and, therefore, postponement and further postponement of the confirmation of the sale could only be by the consent of the parties in the case before us, there was no statutory compulsion to dismiss the application under order XXI, Rule 90 in the absence of an agreement between the parties. The court would have then decided the appeal arising out of the application on the merits. The parties, however, entered into a compromise and invited the court to make an order in terms of the compromise, which the court did. The time for deposit stipulated by the parties became the time allowed by the court and this gave the court the jurisdiction to extend time in appropriate cases. Of course, time would not be extended ordinarily, nor for the mere asking. It would be granted in rare cases to prevent manifest injustice. True the court would not rewrite a contract between the parties but the court would relieve against a forfeiture clause; And, where the contract of the parties has merged in the order of the court, the court's freedom to act to further the ends of justice would surely not stand curtailed. Nothing said in Hukamchand's case militates against this view. We are, therefore, of the view that the High Court was in error in; thinking that they had no power to extend time. Even so, Shri Jawali submitted that this was not an appopriate case for granting any extension of time. We desire to express no opinion on that question. The High Court will decide that question. We accordingly, set aside that judgment dated 15th January, 1979, of the High Court and direct the High Court to dispose of I. A. No. VIII in Execution Second Appeal No. 89/74 in accordance with law. The parties will bear their own costs." 27. The contention of the learned Senior Counsel, was that the Hon'ble Supreme Court categorically held, that the Court can enlarge the time stipulated in the compromise