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2019 DIGILAW 850 (CAL)

Kanta Devi Bhutoria v. Srila Dutta

2019-09-06

SANJIB BANERJEE, SUVRA GHOSH

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JUDGMENT : Suvra Ghosh, J. The appellants are not represented even at the second call. The respondents are represented. The appeal be dismissed for default. The cross objections filed by the respondents are taken up for consideration. The apple of discord between the parties pertains to a property comprising about 7000 sq.ft on the third floor of premises no. 11, Picasso Bithi, formerly known as 11, Hungerford Street which was admittedly owned by the original plaintiff who was the predecessor-in-interest of the present appellants. The respondents and their predecessors intended to construct three additional floors in the disputed premises comprising two floors with a view to develop the property and obtained the sanctioned plan from the Calcutta Municipal Corporation for the said purpose. The respondents, sometime in December 1985, offered to raise such construction of the additional floors according to the sanctioned plan which was conceded to by the appellants by a verbal agreement in January 1986, upon terms and conditions agreed upon by the parties. In or about November 1988, Arun Kumar Bhutoria, deceased predecessor-in-interest of respondents nos. 1b, 1c, and 1d approached the appellants with a proposal to buy a portion of the third floor of the property (subject matter of the suit) and offered earnest money for the same. The predecessor of the appellants agreed in principle to the said proposal provided such proposal was set out in a formal agreement. In the mean time, a notice was served upon the original plaintiff by the Calcutta Municipal Corporation under Section 401 of the Calcutta Municipal Corporation Act, directing him to stop further construction. The sanctioned plan had also expired on November 25, 1988. Pending execution of the agreement for sale of the disputed third floor flat between the parties, the appellants, along with their predecessor- in-interest, forcibly occupied the third floor and proceeded to complete the construction therein despite vehement objection raised by the respondents. The appellants, on the other hand, claimed to have constructed the second, third and fourth floors of the premises and to have entered into an oral agreement with the predecessor of the respondents for purchase of the third floor. The appellants, on the other hand, claimed to have constructed the second, third and fourth floors of the premises and to have entered into an oral agreement with the predecessor of the respondents for purchase of the third floor. According to them, it was agreed between the parties that the third floor of the premises along with two garages and two servants' quarters in the ground floor would be retained by the appellants' predecessor who would pay the respondents' predecessor for the covered area of the third floor comprising 7000 sq.ft @ Rs. 150/- per sq.ft, totally amounting to Rs. 10, 50,000/- and the vendor would execute a conveyance in respect of the said property in his favour. The appellants' predecessor performed his part of the agreement and was ready and willing to abide by the terms of the agreement and the respondents' predecessor was obliged to execute such deed of conveyance in his favour. Upon neglect and refusal of the respondents' predecessor to perform his part of the obligation, the appellants' predecessor claimed specific performance of contract in addition to compensation for loss and damage incurred by him. Two separate suits were instituted - one by the owner Sukdeb Chandra Sinha, praying for recovery of possession of the suit property (C.S. No. 451 of 1989) and the other, by Arun Kumar Bhutoria for specific performance of contract (C.S. No. 348 of 1991). Both the suits were disposed of by a common judgment and order dated October 16, 2015 by the suit court, wherein the Learned Judge dismissed C.S. No. 348 of 1991 and decreed C.S. No. 451 of 1989. The operative part of the judgment impugned is set out:- "Under such circumstances, Mr. Bhutoria has failed to establish its claim for specific performance. C.S. 348 of 1991 is dismissed. The plaintiffs in Suit No. 451 of 1989 are entitled to a decree in terms of prayer (a) and (b). In the event the defendants make over possession of the schedule property to the plaintiff within six weeks from date the plaintiff shall not be entitled to mesne profits. In default Mr. Sabyasachi Chowdhury, advocate, is appointed as Commissioner to compute mesne profits from the date of filing of the suit till delivery of actual physical possession. There shall be decree for a sum of Rs. 11.25 lakhs in favour of the plaintiffs in C.S. No. 348 of 1991. In default Mr. Sabyasachi Chowdhury, advocate, is appointed as Commissioner to compute mesne profits from the date of filing of the suit till delivery of actual physical possession. There shall be decree for a sum of Rs. 11.25 lakhs in favour of the plaintiffs in C.S. No. 348 of 1991. The said sum shall carry interest at the rate of 16% per annum from April, 1988 till payment. However, there shall be no order as to costs". Separate appeals were preferred by the appellants against the judgment impugned and the appeals stood dismissed for default as stated earlier. The cross objections filed by the respondents are on three grounds:- (i) In the judgment impugned, the Learned Judge directed the appellants to deliver possession of the suit property to the respondents within six weeks from the date of the judgment failing which the respondents would be entitled to mesne profits from the date of filing of the suit till delivery of actual physical possession. The respondents contended that such latitude should not have been given to the appellants and they are entitled to mesne profits from the date on which the appellants trespassed into the property. (ii) Though the suit filed by the appellants was dismissed, a decree for a sum of Rs. 11.25 lakhs was granted in favour of the appellants by the Learned Judge despite holding that concluded contract between the parties was not proved. (iii) As the respondents suffered the ordeal of the suits for a considerable period of about 30 years, they are entitled to costs payable by the appellants. In dismissing the appellants' suit and decreeing the respondents' suit by the judgment impugned, the learned Judge allowed mesne profits in favour of the respondents from the date of filing of the suit till delivery of actual physical possession in default of making over possession of the suit property in their favour by the appellants within six weeks from the date of judgment. It appears that the appellants forcibly occupied the suit property (the third floor of the premises) on December 13, 1988 and decree for recovery of possession of the suit property was granted in favour of the respondents by the learned Judge. It appears that the appellants forcibly occupied the suit property (the third floor of the premises) on December 13, 1988 and decree for recovery of possession of the suit property was granted in favour of the respondents by the learned Judge. Therefore the respondents are entitled to mesne profits from the date of forcible occupation of the property by the appellants, i.e., December 13, 1988 till recovery of possession of the property, as prayed for by the respondents. Such mesne profits shall be computed in terms of the direction in the judgment impugned. With regard to the decree for a sum of Rs. 11.25 lakhs in favour of the appellants, to be payable by the respondents, the negotiation between the parties as well as terms of the impugned oral agreement referred to by them requires consideration. It is the case of the respondents that a verbal agreement was entered into by and between the parties for construction of the three additional floors of the building upon certain terms and conditions. One such condition is required to be set out:- "The entire costs of construction of the second, third and fourth floors would be initially borne by the defendants. The plaintiff would have the sole, absolute and unfettered right to sell all the second and third floors or portions thereof to any buyer or buyers as the plaintiff might select and without reference to the defendants. Intimation of such sales shall be given by plaintiff to the defendants and the plaintiff shall arrange and/or cause payments of the costs of construction to be made to the defendants from the intending buyer or buyers." Further case of the respondents in their suit was that the appellants intended to purchase the third floor of the premises (the suit property) and offered a price of Rs. 650/- per sq.ft in addition to 10% of such price as earnest money. The respondents' predecessor Sukdeb Chandra Sinha stated in his evidence before the suit court that he paid Rs. 4,45,000/- to the appellants in advance for the construction and also requested the appellants to raise bills with regard to the cost of construction raised by them in order to enable him to liquidate the amount due to the appellants. Per contra, the appellants' version in the suit is that they were required to pay Rs. 10.5 lakhs to Sukdeb Chandra Sinha @ Rs. Per contra, the appellants' version in the suit is that they were required to pay Rs. 10.5 lakhs to Sukdeb Chandra Sinha @ Rs. 150/- per sq.ft for the third floor flat. According to the appellants, more than Rs. 33, 00,000 lakhs was due to them from Mr. Sinha as cost of construction after Rs.1.25 lakhs were paid. The appellants' predecessor Arun Kumar Bhutoria stated that he requested Mr. Sinha on several occasions for payment of the balance amount and such payment was repeatedly assured despite which no payment was actually made. The judgment impugned held that the appellants failed to prove any concluded oral agreement or specific performance of contract by and between the parties. The suit court observed that though Mr. Sinha claimed to have paid Rs. 4.45 lakhs to the Bhutorias, the Bhutorias admitted receiving only a sum of Rs. 1.25 lakhs and Rs. 11.25 lakhs was found to be due and payable to the Bhutorias by Mr. Sinha. It is unknown as to how such figure of Rs. 11.25 lakhs was arrived at by the suit court. A copy of money receipt dated 02-12-1987 suggests receipt of a sum of Rs. 3, 00,000/- by AK Construction Company (P) Ltd. (Company of the Bhutorias) from Sukdeb Chandra Sinha but relevance of the said document to the suits cannot be inferred. Similarly, the balance sheet of the construction company cannot be related to the suit premises in any manner. There is only an endorsement in the balance sheet of the company dated March 31, 1990 to the effect that "the company has incurred cost of Rs. 11, 24,726.85/- for construction job on land belonging to Sri Sukdeb Chandra Sinha at 11, Hungerford Street, Calcutta, up to 31st March, 1990 shown under the head of work-in-progress. Due to certain dispute, nothing has been done during the year. The company has also received advance amounting to Rs. 1, 25,000/- from the proposed flat buyers."An invoice dated January 24, 1987 issued by Otis Elevator Company (India) Ltd. issued in the name of M/S. A.K. Construction Company (P) Ltd. refers to supply and installation of lift at 11, Hungerford Street, Calcutta, i.e., the suit premises. A verbal agreement between the parties to the effect that the second, third and fourth floors of the premises would be constructed by the appellants is the admitted position. A verbal agreement between the parties to the effect that the second, third and fourth floors of the premises would be constructed by the appellants is the admitted position. The case of the respondents before the suit court was that the appellants would initially bear the entire costs of construction of the three floors. The respondents would sell out the second and third floors or portions thereof to any intending buyer/buyers and arrange for reimbursement of the cost of construction incurred by the appellants from the said buyer/buyers. Also, the respondents would occupy the fourth floor and would pay the appellants the actual costs of construction of the same. The respondents complained that such construction was not completed by the appellants in tune with the agreement and to make it worse, the appellants forcibly and unlawfully occupied the third floor of the premises. It is not disputed that the second floor was sold out to one Bani Rani Bose and Sampa Bose by separate deeds executed by and between the purchasers and Sukdeb Chandra Sinha. Cheques worth Rs. 7, 00,000/- were issued in favour of Sinha by each of the purchasers. There is no evidence on record which suggests that the said amount or any portion thereof was handed over to the appellants in lieu of the cost of construction incurred by them. It is in fact, clear that some amount is due and payable to the appellants by the respondents, though such amount cannot be ascertained from the evidence on record, more so, as the appellants have not cared to place their case before the court in appeal. In the result, it is difficult to perceive that an amount of Rs. 11.25 lakhs is due and payable by the respondents. It is strange to note that no demand fortified by any statement of accounts for expenses incurred was made in writing to the respondents by the appellants. Therefore, this portion of the judgment impugned allowing a sum of Rs. 11.25 lakhs in favour of the plaintiffs in C.S. no. 348 of 1991 cannot be sustained. Moreover, C.S. no. 348 of 1991 was dismissed by the suit court in its entirety. So granting a decree for a sum of Rs. 11.25 lakhs in the same suit was not permissible in law. 11.25 lakhs in favour of the plaintiffs in C.S. no. 348 of 1991 cannot be sustained. Moreover, C.S. no. 348 of 1991 was dismissed by the suit court in its entirety. So granting a decree for a sum of Rs. 11.25 lakhs in the same suit was not permissible in law. However, this judgment shall not preclude the appellants from claiming their dues from the respondents before the appropriate forum in accordance with law. It is pertinent to mention that the appellants filed a separate suit being C.S. no. 349 of 1991 against the respondents, claiming a sum of Rs. 33, 15,000/- from the present respondents as costs of construction of the second and fourth floor of the premises. The said suit was dismissed by the learned Judge with the following observation: - "The plaintiffs have not adduced any evidence in support of its claim for damages as pleaded in paragraph 28 of the plaint. In absence of any evidence and having regard to the findings arrived at in suit no. 451 of 1989 and C.S. no. 349 of 1991, the instant suit being C.S. no. 349 of 1991 stands dismissed." Last but not the least, the respondents have prayed for awarding costs in their favour as they suffered harassment due to pendency of the suits for a considerable period of time. The respondents have placed reliance upon the judicial authority reported in AIR 2005 Supreme Court 3353 (Salem Advocate Bar Association v/s. Union of India). The relevant paragraph of the judgment is required to be set out:- "Judicial notice can be taken of the fact that many unscrupulous parties take advantage of the fact that either the costs are not awarded or nominal costs as awarded on the unsuccessful party. Unfortunately, it has become a practice to direct parties to bear their own costs. In large number of cases, such an order is passed despite Section 35(2) of the Code. Such a practice also encourages filling of frivolous suits. It also leads to taking up of frivolous defences. Further wherever costs as awarded, ordinarily the same are not realistic and are nominal. When Section 35(2) provides for cost to follow the event, it is implicit that the costs have to be those which are reasonably incurred by a successful party except in those cases where the Court in its discretion may direct otherwise by recording reasons thereof. Further wherever costs as awarded, ordinarily the same are not realistic and are nominal. When Section 35(2) provides for cost to follow the event, it is implicit that the costs have to be those which are reasonably incurred by a successful party except in those cases where the Court in its discretion may direct otherwise by recording reasons thereof. The costs have to be actual reasonable costs including the cost of the time spent by the successful party, the transportation and lodging, if any, or any other incidental cost besides the payment of the court-fee, lawyer's fee, typing and other cost in relation to the litigation. It is for the High Courts to examine these aspects and wherever necessary make requisite rules, regulations or practice direction so as to provide appropriate guidelines for the subordinate courts to follow." It appears that the earlier suit was filed by the respondents' predecessor in 1989 and the later suit by the appellants' predecessor in 1991. Both the parties came forward with their respective claims and merely because the appellants were unable to succeed in the suit, it cannot be said that their claim was false or frivolous. It is evident that both the parties suffered the ordeal since institution of the first suit so the respondents are not entitled to any cost as prayed for. The ratio of the judgment cited can, therefore, be distinguished from the factual scenario of the present case. In the light of the observations made above, the cross objections filed by the respondents are partly allowed and the judgment impugned is modified to the extent stated hereinbelow:- (i) The respondents are entitled to mesne profits from the date of forcible occupation of the property by the appellants, i.e., December 13, 1988 till recovery of possession of the property, to be computed in terms of the directions in the judgment impugned. (ii) The portion of the judgment impugned decreeing a sum of Rs. 11.25 lakhs in favour of the plaintiffs in C.S. No. 348 of 1991 is set aside. However, the appellants shall not be precluded from claiming their dues from the respondents before the appropriate forum in accordance with law. (iii) The respondents are not entitled to any costs on account of pendency of the suits for considerable period of time. A.P.D. 40 of 2016 and A.P.D 42 of 2016 are disposed of accordingly. However, the appellants shall not be precluded from claiming their dues from the respondents before the appropriate forum in accordance with law. (iii) The respondents are not entitled to any costs on account of pendency of the suits for considerable period of time. A.P.D. 40 of 2016 and A.P.D 42 of 2016 are disposed of accordingly. There will be no order as to costs.