Covid-19 cannot be used as an excuse to defer payment obligations indefinitely: The High Court of Delhi

IN THE HIGH COURT OF DELHI AT NEW DELHI Date of Decision :18.06.2021 LPA 191 2021 & CM APPLs. 18854 55 2021 ..... Appellant Through Mr.D.Relan Adv. SC for DDA DELHI DEVELOPMENT AUTHORITY along with Mr.Adarsh Aggarwal ..... Respondent Through Mr.Siddharth Banthia Adv. VIKAS GOYAL HON BLE MR. JUSTICE NAVIN CHAWLA HON BLE MS. JUSTICE ASHA MENON NAVIN CHAWLA J.This hearing has been held through video conferencing. CM APPL. 18854 2021(Exemption) Allowed subject to all just exceptions. LPA 191 2021 & CM APPL. 18855 2021 As the learned counsel for the respondent has appeared on an advance notice and has been heard in the appeal we dispose of this appeal at this stage itself. This appeal has been filed by the appellant challenging the interim order dated 13.05.2021 passed by the learned Single Judge in LPA No.191 2021 Digitally SignedBy:SHALOO BATRA19.06.2021 11:39:34Signature Not Verified W.P. No.5138 2021 filed by the respondent herein inter alia directing as under: 7. The petitioner is ready and willing to Rs.1 63 12 000 less Rs.5 25 600 already paid. Without prejudice to the rights and contentions of the parties let the said monies be deposited with the DDA by the petitioner within 3 weeks. The petitioner’s right and position in the said plot of land shall remain secured till the next date." The learned counsel for the appellant has drawn our reference the e mails dated 04.11.2020 11.12.2020 and 19.12.2020 addressed by the respondent to the appellant to contend that the plea of the respondent that the Letter of Intent cannot be given effect to for it did not mention the number of the plot allotted to the respondent is on the face of it incorrect inasmuch as the respondent was well aware of the plot allotted to him and had in fact been seeking extension of time to make the payment on account of financial difficulties arising out of Covid. On the other hand the learned counsel for the respondent submits that the fact that the LOI does not mention the exact plot allotted to the respondent is evident from a reading of the said document. He further submits that the Letter of Intent has not been communicated to the respondent and the appellant has not even placed LPA No.191 2021 Digitally SignedBy:SHALOO BATRA19.06.2021 11:39:34Signature Not Verified on record the purported e mail dated 29.04.2020 along with which it claims to have sent the LOI. He submits that while two extensions were granted for the bidders for making payment of the balance 75% of the bid amount the extension for making the initial deposit of the 25% was granted only once thereby causing discrimination. The learned counsel for the respondent further submits that in terms of the Impugned Order the respondent has also issued a cheque qua the amount payable in terms of the said order in favour of the appellant. 8. We are not impressed with the submissions made by the learned counsel for the respondent. The e mail dated 04.11.2020 of the respondent reads as under: I had applied through e Auction No. Phase VII for INDUSTRIAL PLOT SI. No. 79 Plot No. C 59 Mangolpuri Ph I 100 mtr). I was the highest bidder @ INR 1 63 12 000 as on 20th November 2019.The EMD of INR 5 25 600 was paid on 15 November 2019. I waited for a long time for the letter of intent and later discovered that the letter of intent No.F.1 IndustrialAction Plots DDA 2017 614 had been uploaded on the online portal on 29 April 2020. There was no intimation via email or message. Since the letter of Intent was uploaded in the Covid lockdown period it was not duly communicated to us. Also the time extended by your good self was not LPA No.191 2021 Digitally SignedBy:SHALOO BATRA19.06.2021 11:39:34Signature Not Verified sufficient to meet out the payments as there was a cash crunch due to the pandemic. However I am interested in purchasing the plot and am in the position to make the necessary payments along with interest if any. Thus I want an extension so that I can pay for the plot now. Let me know how to proceed further and allow me to make the Kindly consider unprecedented times." the request The above email clearly gives the plot number which has been allotted to the respondent to his own knowledge as also mentions about the LOI being discovered as having been uploaded on 29.04.2020. It does not complain that the said LOI does not give the plot number thereby in any manner disabling the respondent from making the payment. 10. The e mail dated 11.12.2020 reads as under: successful bidder of above I was mentioned two plots. I have received letter for paying amount of LOA by 15.07.2020. By that time payment was not possible at all due to pandemic however now I can make payment and request you to provide me extension for paying due amount of interest should be LOA. Further no applicable to due amount and the same should be waived off as it was completely beyond my control to make payment in pandemic situation. Kindly consider my extension request. LPA No.191 2021 Digitally SignedBy:SHALOO BATRA19.06.2021 11:39:34Signature Not Verified Please be informed that while I applied for this auction the situation was normal for the business and I had taken commitments for loan from my relatives and friends for fund management However as your good self is aware that now the situation has been changed. The novel coronavirus outbreak has resulted in robust mitigation and containment measures being taken by countries around the world and is having impacts on business activities. This pandemic is a "Force Majeure Event" and is beyond the control of both parties Bidder and DOA. Everyone is under tremendous pressure now. Even our government and RBI has came up with various relaxations and support plans considering such disaster in business and finance sector. Government authorities are refunding all dues to assist public in managing their expenses due to adverse affect on inflow of revenue. Whereas upon receipt of your LOI I felt very much depressed as there was no certainty for how long it will take to get the normal situation and will be able to manage the payment. By the due date of LOA payment first priority of every person was to attain back their business on the track likewise pre Covid. The expansion and investments shall come at very late stage. Everyone has watched the situation and all finance was at stand still till August 2020. No customer was making any business payment. Even at that I was in strong need of money to meet out my personal financial requirement. LPA No.191 2021 Digitally SignedBy:SHALOO BATRA19.06.2021 11:39:34Signature Not Verified Competent Authority has issued LOI on 6th May 2020 for further payment and even extended payment date of 15th July 2020 was completely undue. Due to government restrictions it was not possible for bidders to arrange funds for such heavy investment during this pandemic. Most of the states were in complete lock down and even Delhi government has declared lock down during that period. Even banking services were not in place for any facilitation of loan & finances. In such a situation any obligation which requires something to be done on a particular date in a specific manner was truly impossible to perform. It cannot be possible to pay LOI amount during lockdown and even after immediate resumption of lockdown. frustration now after such breakdown in Indian Economy it is not possible for bidder to pay such heavy amount so conveniently. All industries have been said to pay all business fixed dues and considering no revenue despite forced to pay all fixed expenses shall hugely adversely affect all business person and the disruption has caused heavy losses in all impracticality of performance of terms and conditions laid in Auction contract due to this unexpected occurrence of pandemic situation. This has resulted in frustrating the purpose of this obligation between bidder and Competent Authority. At the time of LOA payment due date whole Indian economy was affected due to all being at a stand still shutdown self isolation or quarantine. Considering the special circumstances I request you to LPA No.191 2021 Digitally SignedBy:SHALOO BATRA19.06.2021 11:39:34Signature Not Verified grant me extension for LOA. I have already sent request letter for extension on 21st September 2020 5th November 2020 20th November 2020 via email and registered post but no response received so any interest if applicable due to delay in payment shall not be bear by me as I am continuously following up with DDA team. Looking forward to your positive outlook on the same." 11. This e mail again admits that the payment was to be made by 15.07.2020 however claims that the respondent was not in a position to make the payment due to the outbreak of the pandemic. This e mail again does not raise any grievance regarding the LOI not mentioning the plot number or other submissions that are now being made by the learned counsel for the respondent. 12. From the above e mails it appears that the ruse of the respondent that the LOA did not mention the number of the plot in question is only an afterthought and an excuse for not having made the payment in time. 13. The submission of the learned counsel for the respondent that for the bidders to make the balance 75% payment two extensions were granted till December 2020 while for making initial deposit by 25% only one extension was granted in our view at least at this stage did not entitle the respondent for any interim relief. LPA No.191 2021 Digitally SignedBy:SHALOO BATRA19.06.2021 11:39:34Signature Not Verified 14. We may also note that the respondent has preferred the writ petition in question only in April 2021 after having come to know that the appellant has to be placed the plot in question in re auction In view of the above the Impugned Order passed by the learned Single Judge is modified to the extent that the appellant shall be free to proceed with the auction process that it has already announced even qua the plot in question however the result thereof as far as the plot in question is concerned shall be subject to further directions of the learned Single Judge in the writ petition. 16. The appellant shall also be at liberty to move an application before the learned Single Judge seeking preponement of the date of hearing of the writ petition if so advised. 17. The present petition is disposed of in the above terms. JUNE 18 2021 NAVIN CHAWLA) VACATION JUDGE ASHA MENON) VACATION JUDGE LPA No.191 2021 Digitally SignedBy:SHALOO BATRA19.06.2021 11:39:34Signature Not Verified 

Summary: The justification given by a person to delay the payment for an auction for an indefinite period of time in lieu of the Covid-19 pandemic is no excuse and cannot be covered by irrational vindications. The aforesaid has been the premise adopted by the Delhi High Court in the case of Delhi Development Authority v. Vikas Goyal [LPA 191/2021 &amp; CM APPLs. 18854-55/2021] which was decided by a two judge bench comprising Justice Navin Chawla and Justice Asha Menon on 18th June 2021. The facts of the case are as follows. It has been contended by the counsel for appellant that in the emails sent by the respondent, it is evident that he was aware about the plot no. that he has been allotted and even sought an extension for the due amount by citing the difficulties faced by him during the pandemic and that the contention made by the respondent about him being unaware of the plot no. is completely baseless and false. On the contrary, the counsel for respondent contended that the Letter of Intent has not been communicated to the respondent and the appellant has not even placed on record the purported e-mail dated 29.04.2020 along with which it claims to have sent the LOI. He submitted that while two extensions were granted for the bidders for making payment of the balance 75% of the bid amount, the extension for making the initial deposit of the 25% was granted only once, thereby causing discrimination. This appeal has been filed by the appellant challenging the interim order dated 13.05.2021 passed by the learned Single Judge whereby he ordered the petitioner to pay the remaining amount within 3 weeks and retain his right and position in the said land.