Winding up proceeding can be admitted on failure to return advance against property on cancellation of agreement

HIGH COURT OF CALCUTTA

Sanchit Vinimay (P.) Ltd.

v.

Mrs. Sipra Thomas

CP No. 270 of 2012

December 14, 2012

JUDGMENT

The Court : The company has no manner of defence to the claim of the petitioning-creditor for refund of a part of the advance payment made for procuring an immovable property.

2. The parties entered into an agreement on July 1, 2012 by which the petitioner agreed to purchase the relevant immovable property at a consideration of Rs.1,90,33,000/-. The petitioner claims that she paid a sum of Rs. 14 lakh as advance and also tendered a further cheque for Rs. 36 lakh. According to the petitioner, she instructed her bankers to stop payment on the cheque for Rs. 36 lakh since by such time she has decided not to purchase the property. By an electronic mail of July 4, 2012, the petitioner conveyed to the company that the petitioner was not able to purchase the flat by making the payment within the given time and the petitioner had cancelled the payment of Rs. 36 lakh. The petitioner also demanded refund of the advance amount of Rs. 14 lakh after deduction of Rs. 5 lakh in terms of the agreement.

3. Clause 10 of the agreement of July 1, 2012 entitled the petitioner to specific performance of the contract in the event the petitioner was desirous of obtaining the property and the seller was unwilling to perform its part of the bargain. Clause 11 of the agreement provided as follows :-

“11. If the BUYER fails to pay the amount as mentioned in point 3 above to the SELLER within 30th August, 2012, (including grace period of TEN days) then the agreement will be cancelled and the SELLER will refund the entire amount after deducting Rs. 5,00,000/- (Rupees Five Lacs Only) as compensation charges.”

4. The petitioner issued a further mail on July 5, 2012 calling upon the company to immediately refund the deposit. Some correspondence was exchanged between the parties thereafter which may not be relevant in the present context.

5. The statutory notice was issued on July 14, 2012 to which the company replied on August 16, 2012 claiming that the company had apparently suffered huge financial loss for not being able to sell the flat and the company reserved its right to institute proceedings against the petitioner for the loss and damage. The company also denied its liability to the petitioner.

6. It is submitted on behalf of the company that since Clause 11 permitted the cancellation to be effected by the end of August, 2012, the liability of the company, if at all, could arise only after August 30, 2012. It is the company’s contention that both the statutory notice and the institution of the present proceedings are premature and the company is not called upon to address the merits of the claim.

7. The stand is utterly dishonest. Clause 11 of the agreement only stipulated the time within which the entire consideration in terms of the agreement was to be paid. Such clause did not dis entitle the buyer from terminating the agreement prior to August 30, 2012. In this case, the agreement was entered into between the parties on July 1, 2012 and by the mail of July 4, 2012, the petitioner evinced her desire not to go ahead with the transaction. Indeed, the petitioner unilaterally offered the deduction in terms of Clause 11 of the agreement though it would have been understandable for the petitioner even to require a reconsideration of the matter since the termination followed within the days of the execution of the agreement.

8. The company has no defence to the claim and none has been indicated either in the reply to the statutory notice or in the affidavit filed on its behalf.

9. CP No. 270 of 2012 is admitted for the principal sum of Rs. 9 lakh together with interest thereon at the rate of 15% per annum from July 5, 2012 till payment. If the entire amount, inclusive of interest and costs assessed at 2000 GM is paid over by the company to the petitioner within a week from date, the petition will remain permanently stayed. In default, the petition will be advertised once in The Statesman and once in Bartaman. The advertisements should indicate that the matter will appear before Court on the first available working day after the expiry of four weeks from the date of the publications being made. Publication in the Official Gazette will stand dispensed with.

10. After the order is passed, the company seeks further time for the payment to be made. Subject to the company immediately and unconditionally withdrawing the criminal proceedings in respect of the cheque for Rs. 36 lakh, the company will make payment of the sum of Rs. 9 lakh together with interest thereon at the rate of 8% per annum and costs assessed at 100 GM in three instalments payable by the last day of this month and the last day of the two succeeding months. It is only in default of payment of such installment, the petition will be advertised as per the aforesaid directions.

11. The petitioner suggests that the payments may be tendered by way of a pay order favoring the petitioner and forwarded to Advocate representing the petitioner. The installment payments will be made accordingly.