Bhandari Construction Company Vs. Narayan Gopal Upadhye  Insc 165 (20 February 2007)
B.P. SINGH & P.K. BALASUBRAMANYAN
(Arising out of SLP(C) No. 17702 of 2006) P.K. BALASUBRAMANYAN, J.
This appeal challenges the decision of the National Consumer Disputes Redressal Commission
The appellant is a construction
company. The respondent sought to purchase an office room in the third floor of
a building being constructed by the appellant. The parties agreed to sell and
purchase. According to the company the purchase price was fixed at
Documentation, registration and other expenses were to be borne by the
respondent Rs.5,00,000/- was paid by cheque.
The balance due, was Rs. 3,41,190/-. The respondent had not paid the said
sum. The sale transaction was, therefore, not complete. The room was not put in
the possession of the respondent. The terms of the transaction were reduced to
writing by an agreement dated 27.7.1997.
The respondent approached the District Consumer Redressal Forum with a
complaint. His case as per his amended complaint was as follows:
On 4.7.1997 the company agreed to sell a room having an area of 260 sq.ft.
for a price of Rs.9,00,110/-. The amount was paid in a lump. Receipt for
Rs.9,00,110/- was issued. The company issued an allotment letter dated
22.7.1997. On 31.7.1997 the agreement was executed. In spite of repeated
demands after completion of the construction, the company did not put him in
The company was demanding extra amounts. It avoided handing over of
possession. It issued a notice intending to terminate the agreement. Since
possession was not given and the company attempted to sell the premises to
someone else, he suffered losses which were shown as amounting to Rs.4,84,000.
He was, therefore, entitled to recover a sum of Rs.4,84,000/- as compensation.
He was entitled to an order restraining the company from transferring the
office room bearing No.309, to any other person. The company was liable to be
directed not to create any obstruction in his taking possession of office room
No.309. The company was to be directed to remove the lock it had put at the
door of the room.
It is seen that on 4.7.1997 the respondent handedover two cheques bearing
No.299667 and 299678 to the company for a total sum of Rs.9,00,000/-. He paid a
sum of Rs.110/- in cash. He obtained a receipt. Cheque No.299667 was for
Rs.7,50,000/- and cheque No.299668 was for Rs.1,50,000/-. The parties agree
that these two cheques were not encashed, but were returned to the respondent.
According to the company, the respondent agreed to destroy the receipt for
Rs.9,00,110/- issued in that behalf, by the company. The case of the company is
that the cheques were returned because the purchase price was something less
than Rs.9,00,000/- and it was found to be only Rs.7,75,000/-. In view of this,
the respondent on 8.7.1997, issued a fresh cheque to the company, bearing
No.299669, for a sum of Rs.5,00,000/-. That cheque was encashed by the company.
The parties reduced the transaction into writing. As per that agreement, the
payment of Rs.5,00,000/- by cheque dated 8.7.1997 and its receipt was
acknowledged. A sum of Rs.1,25,000/- was to be paid by 15.8.1997. Another sum
of Rs.1,25,000/- was to be paid by 19.9.1997. Rs.25,000/- was to be paid at the
time of transfer of possession. A sum of Rs.150/- per sq. ft. by way of deposit
for meeting the maintenance charges, was also to be paid. The payment by the
purchaser was to be the essence of the contract. The total purchase price was
shown in the agreement as Rs.7,75,000/-.
Before the District Forum, the company denied the case of the respondent
and set up in defence the written agreement between the parties. It pleaded
that in spite of being called upon to do so, the respondent had not paid the
balance amount due. The company, therefore, terminated the agreement. The
respondent was not entitled to any relief.
The sum of Rs.5,00,000/- received by cheque had been returned to the
respondent and the cheque issued in that behalf was received by him.
In his evidence before the District Forum, the respondent made a
departure from the complaint regarding consideration. He admitted that the sum
of Rs.9,00,000/- paid by way of two cheques by him on 4.7.1997, was returned to
him. He had agreed to destroy the receipt. He said that the cheques were
returned because the Director of the company wanted a portion of the
consideration in cash. He wanted Rs.5,00,000/- by way of cheque and
Rs.4,00,000/- by way of cash. The respondent handed over a cheque for
Rs.5,00,000/-, as agreed on all hands. The same day, he withdrew from the bank
a sum of Rs.4,00,000/- by cash and handed it over to one Thanekar who was an
agent of the company. But the respondent produced no receipt for payment of this
amount, though such a payment was denied by the company.
Before the District Forum, the
respondent gave up his claim for compensation and pressed only the relief of
getting possession of the building on the basis that he had paid the entire
consideration. Of course, he tried to say that he had already been put in
possession and his possession was being interfered with by the company. The
District Forum took the view that it would be proper to leave the respondent to
approach the Civil Court for relief in view of the nature of the dispute. The
complaint was, therefore, dismissed. The respondent went up in appeal to the
State Commission. The State Commission remanded the complaint to the District
Forum to decide the dispute. It took the view that it was not necessary or
proper to refer the complainant to a suit. Thus, the matter came back to the
Before the District Forum, further
evidence was taken. The complainant and the representative of the company were
cross-examined on the affidavits filed by them.
The District Forum found that the respondent had not established that he had
paid the entire consideration of Rs.7,75,000/-. According to the District
Forum, the written agreement governed the relationship between the parties.
There was also no evidence to prove the payment of Rs.4,00,000/- in cash as
claimed by the respondent. The payment of Rs.5,00,000/- out of the purchase
price of Rs.7,75,000/- by way of cheque alone was established.
Though the same had been returned to the respondent by way of a cheque, he
had not encashed it. The District Forum therefore passed an order giving
liberty to the respondent to pay a sum of Rs.3,40,890/- along with interest at
15% per annum from 3.9.1999 till the date of payment and to obtain possession
of the office premises in question within a period of two months from the date
of receipt of that judgment and directed the company to handover vacant
possession of the premises within a period of two months from the date of
receipt of the amount. But alternatively, it gave liberty to the respondent to
demand from the company the refund of Rs.5,00,000/- along with interest at 15%
per annum from 8.7.1997 till the date of realisation by issue of a notice in
that behalf to the company. On receipt of such a notice the amount was to be
paid by the company within two months of its receipt.
The respondent, feeling aggrieved,
appealed to the State Commission. The company, it is said filed a belated appeal
but the delay was refused to be condoned. Therefore, the decision of the
District Forum as against the company became final.
The State Commission proceeded to accept an affidavit filed by an
employee of the bank on which a self cheque was drawn by the respondent. The
allegation in that affidavit was that a self cheque for Rs.4,00,000/- was
encashed by the respondent and the amount was handed over to Thanekar, an agent
of the company. That allegation was accepted. No opportunity was provided to
the company to cross-examine the employee. The State Commission modified the
decision of the District Forum. It directed the company to handover the
premises to the respondent on the basis that the entire consideration had been
paid. It also ordered that the company had to pay interest at 6 % per annum on
the sum of Rs.9,00,110/-. The order of the State Commission is seen to be
cursory. It had not even referred to the relevant pleadings and the evidence,
before interfering with the order of the District Forum. It is difficult to
understand its reasoning.
The company filed a revision before the National Commission. The company
pointed out the variance between the case set up by the respondent in his
complaint and in his evidence. It pointed out that the terms of the transaction
having been reduced to writing, it was not open to the respondent to lead
evidence in variation thereof. It also pointed out that the evidence attempted
to be given was also at variance with the case set up. It pointed out that
there was no receipt evidencing the alleged payment of Rs.4,00,000/- to the
company. The payment was not proved. All the other payments had been
acknowledged by receipts. The State Forum was, therefore, in error in
interfering with the order of the District Forum. It was also submitted that
during the pendency of the proceedings, the premises had been transferred to
some other person and hence the company should be relieved of its obligation to
deliver the premises. The respondent reiterated his contention that he had paid
a sum of Rs.9,00,000/- to the company. He also appears to have made some
general submissions on the tendency of builders to receive part of the sale
price in cash.
The National Commission brushed aside
the contentions of the company. It did not place due emphasis on the case set up
by the respondent in his complaint and the total departure from that case made
in his evidence. It ignored the fact that the agreement between the parties
having been reduced to writing there was a bar against leading evidence
contradicting its terms. Decrying what it termed the attitude of builders in
demanding part of the sale price in cash, the National Commission dismissed the
revision. This is what is challenged in this appeal by the company.
We find that the respondent had totally given up the case set up by him
in his complaint while giving evidence. The transaction on 4.7.1997 as set up
by the respondent was given up by him. He also admitted that the two cheques
handed over for Rs.9,00,000/- that day, were not encashed by the appellant. He
admitted that they were returned. He further admitted that the receipt for
Rs.9,00,000/- issued to him was in respect of those two returned cheques. He
also admitted that he had thereafter issued a cheque for Rs.5,00,000/-. He
agreed that a sum of Rs.5,00,000/- by way of a cheque was returned to him by
the company. But he had not encashed it.
He admitted the agreement dated 27.7.1997 and the terms thereof and the
factum of its registration on 31.7.1997. He also admitted that he had no
receipt to show the payment of Rs.4,00,000/- in cash.
When the terms of the transaction are
reduced to writing, it is impossible to lead evidence to contradict its terms in
view of Section 91 of the Evidence Act. There is no case that any of the
provisos to Section 92 of the Act are attracted in this case. Why the case that
was sought to be spoken to by the respondent was not set up by him in the
complaint was not explained. The case set up in evidence was completely at
variance with the case in the complaint. There was no evidence to show that the
consideration was to be Rs.9,00,000/-, especially, in the light of the recitals
in the registered agreement. There was also no document to show the payment of
Rs.4,00,000/- by way of cash. Hence, this was no evidence to show that the
balance amount due under the agreement after the admitted payment of
Rs.5,00,000/- was paid. The affidavit produced before the State Forum and the
evidence of the colleague of the respondent is clearly inadmissible and
insufficient to prove any such payment.
Thus, the case set up by the respondent in his evidence was not established.
It is in that situation that the District Forum taking note of the payment of
Rs.5,00,000/- and the failure of the respondent to encash the cheque for
Rs.5,00,000/- that was returned by the company, ordered the complainant to pay
the balance amount due under the transaction as evidenced by the written
instrument and take delivery of the premises in question and in the alternative
gave him the option to take back the sum of Rs.5,00,000/- with interest.
Neither the State Commission, nor the National Commission has given any
sustainable reason for differing from the conclusion of the District Forum. A
mere suspicion that builders in the country are prone to take a part of the
sale amount in cash, is no ground to accept the story of payment of
Rs.4,00,000/- especially when such a payment had not even been set up in the
complaint before the District Forum. Not only that, there was no independent
evidence to support the payment of such a sum of Rs.4,00,000/- except the ipse
dixit of the respondent. The affidavit of the bank employee filed in the State
Commission cannot certainly be accepted as evidence of such a payment. Payment
of such a sum had clearly been denied by the company. The respondent had,
therefore, to prove such a payment. His case that the purchase price was
Rs.9,00,000/-, itself stands discredited by the recitals in the agreement dated
27.7.1997 in which the purchase price was recited as Rs.7,75,000/-. Not only
that the respondent did not have a receipt for evidencing the payment of
Rs.4,00,000/- and if the amount was paid on 5.7.1997 or 8.7.1997, as claimed by
him, he would certainly have ensured that the payment was acknowledged in the
agreement for sale executed on 27.7.1997. The agreement for sale actually
speaks of his obligation to pay the balance to make up Rs.7,75,000/- after
acknowledging receipt of Rs.5,00,000/-. The respondent is not a layman. He is a
practising advocate. According to him, he specialises in documentation. He cannot,
therefore, plead ignorance about the existence of the recital in the agreement.
He cannot plead ignorance of its implications.
We were taken through the entire material. The respondent who appeared
in person, brought to our notice the evidence in extenso. At the end of it all,
we find that we cannot agree either with the State Commission or with the
National Commission. Actually, the District Forum had been indulgent to the
respondent in giving him the relief it did.
Suffice it to say, we find it impossible to sustain the decision of the
Hence, we allow this appeal. We set
aside the decision of the National Commission and that of the State Commission.
We restore the decision of the District Forum.
Normally, we would have ordered the cost of the appeal to the company, but
since the respondent appeared in-person, we refrain from ordering it. The
parties will bear their costs in this Court.