Mr. Dinesh Gupta & ANR. v. Sh. Maman Singh, & ORS.

$~32 *

IN THE HIGH COURT OF DELHI AT NEW DELHI

+ MR. DINESH GUPTA & ANR.

..... Petitioners Through:

Mr Gaurav Mitra, Mr Nandita Abrol Ms Vrishti Gupta and Ms Rashmita Roy Chawdhury, Advocates.

versus SH. MAMAN SINGH & ORS.

..... Respondents Through:

CORAM:

HON'BLE MR. JUSTICE VIBHU BAKHRU

O R D E R

% 01.02.2017 IA No.1330/2017 1.

Allowed, subject to all just exceptions.

2.

The application is disposed of.

3.

The petitioner has filed the present petition under Section 9 of the Arbitration and Conciliation Act, 1996 (hereafter 'the Act'), inter alia, praying as under:- "a.

Restrain the Respondent from forfeiting the amount of Rs.

8,42,91,661/- paid as part consideration by the Petitioners to the Respondents till the arbitration proceedings and further secure the amount of Rs.8,42,91,661/- which is the part consideration of the purchase paid by the Petitioners;

b.

Restrain the Respondent for alienating any third party interest in the aforesaid land mentioned in the agreement

dated 09.12.2015 till the finality of the arbitration proceedings;"

4.

The petitioners state that they had entered into an agreement to sell (ATS) with the respondents on 09.12.2015 whereby the petitioners had agreed to purchase and the respondents had agreed to sell a parcel of agricultural land measuring 23.16 bighas (4.95818 acres) located at Vasant Kunj, New Delhi, at the rate of ₹17,00,51,000/- per acre. The petitioners state that in terms of the ATS, they paid a sum of ₹8,42,91,661/- as part payment towards the sale consideration for purchase of the land in question. 5.

In terms of ATS, the sellers (respondents) agreed not to enter into any agreement to sell in respect of the land in question or any part thereof. The petitioners further agreed to pay the balance 45% of the consideration within a period of nine months from the date of the ATS and the remaining balance within 12 months. In other words, the petitioners were to pay 45% of the consideration on or before 15.09.2016 and the remaining balance by 15.12.2016. Admittedly, the petitioners have failed to pay any sum other than the initial payments aggregating to ₹8,42,91,661/-. Since the petitioners failed to pay the balance consideration within the agreed period, the respondents caused a notice dated 16.12.2016 to be sent to the petitioners calling upon them to pay the balance consideration within 15 days of the receipt of notice, failing which the respondents would forfeit the amounts already paid and the ATS would stand cancelled. This has led the petitioners to approach this Court by way of the present petition. 6.

The learned counsel appearing for the petitioners earnestly contended that there was no default on the part of the petitioners as, in terms of the

ATS, the respondents had agreed to pay the property tax, water, electricity charges and other dues in respect of the land in question up to the date of registration of the sale deed. He drew the attention of this Court to a notice dated 13.06.2016 sent by the Assistant Assessor and Collector, South Delhi Municipal Corporation calling upon the sellers to appear before the authority for assessment of property tax. He submitted that thereafter, the petitioners had also sent a letter dated 03.09.016 calling upon the respondents to pay the requsite taxes and arrange certain documents for proceeding further with the ATS. He submitted that the respondents had failed to pay the property taxes for several years and, therefore, were responsible for the delay in completion of the transaction.

He further submitted that initial amounts paid were not earnest money but part of the sale consideration and, thus, could not be forfeited. He submitted that in the aforesaid context, the respondents should be restrained from alienating the land in question for securing the petitioners for the amount already paid.

7.

It is prima facie apparent from the above that petitioners are in default of performing their obligations under the ATS. The contention that the respondents were required to settle the property tax dues as a pre-condition for the petitioners to pay even the first tranche of the balance amount, is unpersuasive. Concededly, the petitioners were required to pay 45% of the total consideration within a period of 9 months and the remaining 45% by 15.12.2016. Admittedly, the petitioners have even defaulted in making payment of the first tranche of balance consideration. Plainly, the petitioners would not be absolved of their liability to pay the first tranche for the stated reasons. Prima facie non-payment of property tax cannot be

accepted as a ground which would absolve the petitioners from making payment of even the first tranche of the consideration. 8.

It is also relevant to note that there is no averment made in the petition which would indicate that the respondents are in the process of alienating or secreting their assets which would frustrate any money award that may be passed in favour of the petitioners.

9.

The respondents have cancelled the ATS and prima facie for good reason. In view of the prima facie finding that the petitioners are in default of their obligations under the ATS, the injunction restraining the respondents from transfering or selling the land in question cannot be granted. Further no order for securing any amount paid by the petitioners is warranted at this stage as there are no pleadings which would indicate that there are any reasonable grounds to apprehend that the respondents would alienate their assets and frustrate any arbitral award for refund of initial payment (or damages) that may be passed against them.

10.

The petition is, accordingly, dismissed.

VIBHU BAKHRU, J FEBRUARY 01, 2017 RK