Usha Joshi v. Ashok Kumar Ahluwalia & Anr.

12. Though there can be no dispute on the fact that the order dated 22.07.2022 clearly records the terms of the settlement arrived at between the parties, the fact remains that the same has not been signed by the parties.

13. In Gurpreet Singh (supra), interpreting the provisions of Order XXIII Rule 3 of the CPC, the Supreme Court has observed as under:

10. Under Rule 3 as it now stands, when a claim in suit has been adjusted wholly or in part by any lawful agreement or compromise, the compromise must be in writing and signed by the parties and there must be a completed agreement between them. To constitute an adjustment, the agreement or compromise must itself be capable of being embodied in a decree. When the parties enter into a compromise during the hearing of a suit or appeal, there is no reason why the requirement that the compromise should be reduced in writing in the form of an instrument signed by the parties should be dispensed with. The court must therefore insist upon the parties to reduce the terms into writing. xxxxx

12. In any event, the present case clearly does not come within the ambit of the second part of Order XXIII, Rule 3 of the Code. Under the terms of the proposed compromise, the appellant was required to pay Rs 2,25,000 by a bank draft on 17-3-1987, but the fact remains that the respondent before the due date resiled from the proposed compromise saying that it was detrimental to his interest. That being so, the appellant could only fall back on the first part. But in the absence of an agreement in writing, the learned Judges had no other alternative but to direct that the appeal be listed for hearing on merits.”

14. The submission of the learned counsel for the defendants that the decree can still be passed recording the satisfaction of the claim of the plaintiff, also cannot be accepted as the defendant is not conceding to the prayers made in the suit. The plaintiff is also not conceding that the claim in the suit stood satisfied with the order of 22.07.2022. She, in fact, does not wish to abide by the same.

15. In view of the above, I have no option but to dismiss the present application. IA 20189/2022

16. This application has been filed by the plaintiff under Order VI Rule 17 of the CPC, praying for permission to amend the Plaint so as to add the following prayer in the alternative: - “Or in the alternative b. Pass a decree in favour of the plaintiff and against the defendants thereby directing the defendants to refund the entire earnest money to the plaintiff amounting to Rs. 85 lacs illegally and unjustifiably withheld by the defendants apropos the Agreement to Sell dated: 07.03.2022, along with an interest @ 9% p.a.”

17. Placing reliance on Section 22 of the Specific Relief Act, 1963 (in short, ‘the Specific Relief Act’), the learned counsel for the plaintiff submits that as the suit is at the initial stage, moreover, as the written statement has not been filed by the defendant yet, the plaintiff is entitled to amend the plaint so as to add the alternate relief.

18. On the other hand, the learned counsel for the defendants submits that in terms of the Agreement to Sell dated 07.03.2022 itself, the defendants are entitled to forfeit the amount of earnest money that was paid by the plaintiff in terms of the said agreement.

19. He further submits that in view of the order of 22.07.2022 passed by this Court, even otherwise, the plaintiff is not entitled to seek refund of the earnest money deposited. He submits that in fact, with the 2018 amendment to the Specific Relief Act and specifically in Section 10 thereof, the Specific Performance of the agreement is the norm and the discretion earlier vested in the Court is no longer available. The plaintiff having failed to comply with the terms of settlement has disentitled herself to the claim of specific relief and equally to the relief of refund of the earnest money. He submits that the application has been filed by the plaintiff with mala fide intent of continuing with the frivolous suit.

21. The learned counsel for the defendants submits that in the suit filed, the plaintiff has prayed for specific performance of the agreement dated 07.3.2022 claimed by the plaintiff to be revised by the defendants orally and through WhatsApp on 24.05.2022, while by the present application, the plaintiff seeks refund of the earnest money deposited only under the Agreement to Sell dated 07.03.2022. He submits that therefore, there is inconsistency in the prayers.

22. I have considered the submissions made by the learned counsels for the parties.

23. Section 22 of the Specific Relief Act provides that where the plaintiff has not claimed a relief, inter alia, of refund of the earnest money or deposit paid or made by him under the Agreement to Sell, the Court shall, at any stage of the proceedings, allow him to amend the plaint on such terms as may be just for including a claim for such relief.

24. In view of the above provision, the plaintiff is within his rights to now add the alternate prayer, especially as the suit is at the initial stage itself with the defendants not even having filed their Written Statement. Whether the alternate prayer can or cannot be granted, is not to be considered by this Court at the stage of considering the present application. The same would necessarily have to await the formal amendment to the plaint. The submissions of the learned counsel for the defendants are primarily on the merit of the prayer which now is sought to be added by the plaintiff in the plaint. The consideration of the merit of the prayer has to await and cannot be a reason for rejecting the amendment.

28. Accordingly, the present application is allowed. The amended plaint is taken on record.

29. Let the Plaint be registered as a Suit.

30. Issue summons to the defendants.

31. Summons are accepted by Mr.Sanjeev Sahay, Advocate on behalf of the defendants.

32. Let the Written Statement be filed within four weeks. Replication thereto, if any, be filed within four weeks of the receipt of the Written Statement. The Written Statement and the Replication shall be accompanied with the affidavit of admission/denial of the documents filed by the other party, failing which the Written Statement/Replication shall not be taken on record.

33. List before the learned Joint Registrar (Judicial) on 28th July,

2023. I.A. 11267/2022

34. This application has been filed by the plaintiff praying for the following relief:- “a) Pass an ex-parte ad-interim order injuncting and restraining the Defendants, their agents, delegates, representatives, assignees, legal representatives, legal heirs etc. from creating any third party interest, selling, alienating, offering for sale, dealing with or making any alteration or construction of any kind in the suit property for which the agreement to sell dated 07.03.2022 had been signed and executed by the Defendants in favour of the Plaintiff pending disposal of the present suit.”

35. When the suit was first listed before this Court on 22.07.2022, the following order was passed:- “5. The present suit has been filed seeking, inter alia, specific performance of an Agreement to Sell dated 7th March, 2022, in terms of which the defendants had agreed to sell to the plaintiff the residential property, being property no. B-4/2, admeasuring 272.15 square yards situated in the area of Village Basai, Darapur Colony, known as Rajouri Garden, New Delhi-110027 (suit property) for a sum of Rs.8,50,00,000/-. Out of the aforesaid amount, a sum of Rs.85,00,000/- has been paid by the plaintiff to the defendants as earnest money.

6. Counsel for the plaintiff, on instructions from the plaintiff, who is present in person, states that out of the remaining amount, a sum of Rs.2,00,00,000/- would be paid to the defendants on or before 31st July, 2022 and the remaining amount shall be paid on or before 20th August, 2022. Counsel for the defendants is agreeable to the same, provided the plaintiff pays interest on the amount paid after 31st

7. Counsel for the plaintiff states that the plaintiff is agreeable to pay interest at the rate of 9% per annum on the balance amount that remains unpaid after 31st

8. Accordingly, it is agreed between the parties that on the balance amount that remains unpaid as on 31st July, 2022, the plaintiff shall pay interest at the rate of 9% per annum to the defendants.

9. It is also agreed that the plaintiff shall cooperate with the defendants in getting the FIR No. 390/2022 under Sections 420/406/34 of the Indian Penal Code, 1860 registered on 2nd July, 2022 at Kirti Nagar Police Station, quashed.”

36. The above order records the terms of the settlement between the parties. Though, as held hereinabove, the said terms of settlement cannot lead to a decree being passed, however, they would be relevant for determining the present application.

37. It is a matter of record that the plaintiff defaulted in complying with the terms of the settlement, and instead, filed an application, being I.A. No.11820/2022, inter alia praying for modification of the order dated 22.07.2022, contending therein that the above settlement was not consented to by the plaintiff but was wrongly conceded to by the then counsel of the plaintiff. The said application, however, has been withdrawn by the plaintiff by the order dated 14.3.2023. With the withdrawal of the said application, two consequences follow:- (a) The parties had entered into a settlement whereby, in spite of a prima facie default of the plaintiff to comply with the terms of the agreement to sell, the defendant had agreed to give further time to the plaintiff to comply with the terms of the settlement, subject to payment of interest on the amount outstanding; (b) The plaintiff defaulted in complying with even this concession. In fact, the plaintiff remains in default even till date.

38. The learned counsel for the plaintiff submits that the plaintiff had, in fact, obtained in-principle approval of a home loan from the Axis Bank. He submits that the transaction could not be completed for want of co-operation from the defendants. This is disputed by the learned counsel for the defendants. He submits that, in fact, the Bank Loan was withdrawn by the plaintiff prior to the filing of the present suit.

41. Be that as it may, the fact remains that the plaintiff has neither complied with terms of the agreement to sell dated 07.3.2022 nor with the settlement terms as recorded in the order dated 22.7.2022. In terms of Section 16 of the Specific Relief Act, therefore, prima facie the plaintiff would not be entitled to a relief of specific performance of the Agreement to Sell. The plaintiff has now also sought an alternate relief of refund of the earnest money deposited by the plaintiff. The said relief has been allowed to be added to the Plaint by the order passed today.

43. In view of the above, I find no prima facie case made out by the plaintiff for grant of relief. The balance of convenience is also in favour of the defendants and against the plaintiff. In fact, the very pendency of the suit can result in a gross irreparable damage to the defendants inasmuch as, the value of their property shall stand depreciated in view of the present suit.

44. In Santokh Singh and Anr. Vs. M/s Shagun Farm Pvt. Ltd., 2017 SCC OnLine Del 6844, taking into account the conduct of the plaintiff therein, the court observed that the doctrine of lis pendens will not apply to the property that was subject matter of the suit and the defendant therein would be free to deal with the property. This Court observed as under:-.

45. The above view was followed by this Court in Earthz Urban Spaces Pvt. Ltd. v. Ravinder Munshi & Ors., 2022 SCC OnLine Del 1745, where again a learned Single Judge of this Court held that the doctrine of lis pendens shall not apply, observing as under:

45. In the present case as well, taking into account the conduct of the plaintiff, I am of the view that the likelihood of the plaintiff succeeding is remote and that great prejudice would be caused to the defendants if the doctrine of lis pendens is to apply against the Suit property merely because summons in the Suit have been issued.

46. In view of the above, in my opinion, the doctrine of lis pendens shall not apply against the subject property.

45. Accordingly, I find no merit in the present application. The same is dismissed holding that even the doctrine of lis pendens shall not apply to the Suit property.

NAVIN CHAWLA, J APRIL 26, 2023