DESH RAJ & ORS. versus ROHTASH SINGH

DESH RAJ & ORS. versus ROHTASH SINGH

The Supreme Court held that the sale agreements expressly made time the essence and the respondent delayed and failed to prove he procured required NOCs; the appellants lawfully treated the agreements as terminated and forfeited the earnest money under the contractual terms; the respondent had not prayed for refund of earnest money in the plaint and did not contest the nature of forfeiture, therefore the refund decree was unsustainable and the suit was to be dismissed.

Parties
Appellants: Desh Raj & Ors.; Respondent: Rohtash Singh
Jurisdiction
India
Judgment Date
14 December 2022
Procedural Posture
Civil Appeal (supreme Court) / Appeal Against High Court Judgment Dated 15.05.2019
Outcome
Appeal allowed; judgments of courts below set aside; suit dismissed
Legal Topics
Specific Performance, Forfeiture of Earnest Money, Time as Essence of Contract, Refund of Earnest Money, Obligations to Procure Nocs, Effect of Acquisition on Contracts
Indian Contract Act, 1872 Specific Relief Act, 1963 Haryana Development and Regulation of Urban Areas Act, 1975 Hindu Minority and Guardianship Act, 1956 Land Acquisition Act, 1894 Code of Civil Procedure, 1908 Specific Performance Forfeiture of Earnest Money +4 more

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Parties

Desh Raj & Ors.

Appellants

Rohtash Singh

Respondent

Procedural Posture

Civil Appeal (supreme Court) / Appeal Against High Court Judgment Dated 15.05.2019

Legal Issues

  1. 1 Whether time was the essence of the sale agreements and consequences of non-performance at fixed time
  2. 2 Whether the appellants willfully avoided performance by not procuring NOCs under Section 7A of the HUDA Act
  3. 3 Whether the respondent was entitled to recovery/refund of earnest money despite not claiming it in the plaint

Ratio Decidendi

The Supreme Court held that the sale agreements expressly made time the essence and the respondent delayed and failed to prove he procured required NOCs; the appellants lawfully treated the agreements as terminated and forfeited the earnest money under the contractual terms; the respondent had not prayed for refund of earnest money in the plaint and did not contest the nature of forfeiture, therefore the refund decree was unsustainable and the suit was to be dismissed.

Court Disposition

Appeal allowed; judgments of courts below set aside; suit dismissed

Orders

  • Impugned judgments and decrees of the High Court and lower courts set aside
  • Suit for specific performance dismissed