Delhi High Court
Sh. Sarjeet Sharma & Ors vs Sh. Jagdev Sharma Since Deceased … on 23 April, 2026
Author: Neena Bansal Krishna
Bench: Neena Bansal Krishna
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Reserved on: 12th February, 2026
Pronounced on: 23rd April, 2026
+ RFA 666/2022, CM APPL. 55516/2022(Stay)
1. Sh. Sarjeet Sharma
2. Sh. Jagdish Sharma
3. Sh. Vijay Kumar
4. Sh. Krishan Kumar
5. Sh. Virender
All Sons of Late Sh. Mange Ram
All Residents of:
Village & P.O. Pandwala Kalan,
New Delhi .....Appellants
Through: Mr. B.D. Sharma, Advocate
versus
Sh. Jagdev Sharma (Since Deceased)
Through His Legal Representatives
1. Smt. Chanderwati
W/O Late Sh. Jagdev Sharma
2. Sh. Sanjeev Kumar
S/O Late Sh. Jagdev Sharma
3. Smt. Beena Devi
W/O Late Sh. Rajesh Vats
S/O Late Sh. Jagdev Sharma
4. Sh. Mohit Vats
S/O Late Sh. Rajesh Vats
S/O Late Sh. Jagdev Sharma
5. Sh. Rohit Vats
S/O Late Sh. Rajesh Vats
S/O Late Sh. Jagdev Sharma
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All Residents Of:
Village Samalkha, New Delhi
6. Smt. Deepika Sharma
W/O Late Sh. Rajesh Sharma
D/O Late Sh. Rajesh Vats
S/O Late Sh. Jagdev Sharma
R/O Village & P.O. Dera Fatehpur, New Delhi
7. Smt. Monica
D/O Late Sh. Rajesh Vats
S/O Late Sh. Jagdev Sharma
R/O Village Samalkha, New Delhi
8. Smt. Kanta Bhardwaj
W/O Sh. Dinesh Bhardwaj
D/O Late Sh. Jagdev Sharma
R/O H.No.1549, Sector-15, Part-Ii,
Gurgaon, Haryana.
9. Smt. Manju
W/O Sh. Ramesh Chand
D/O Late Sh. Jagdev Sharma
R/O Village Tajpur Khurd,
P.O. Chhawla, New Delhi .....Respondents
Through: Mr. Pankaj Vivek, Mr. Suryansh
Jamwal, Mr. Tarun Kumar and
Mr. Hardeep Godhara, Advocates
CORAM:
HON'BLE MS. JUSTICE NEENA BANSAL KRISHNA
J U D G M E N T
NEENA BANSAL KRISHNA, J.
1. Regular First Appeal under Section 96 read with Order XLI of the
Code of Civil Procedure, 1908 (hereinafter referred to as „CPC‟) has been
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filed against the Judgment and Decree dated 24.09.2022 whereby the
Plaintiff filed a Suit for Recovery of Rs. 1,09,82,000/- along with pendente
lite and future interest.
2. The brief facts as per Plaint are that the Plaintiff is a landlord and
agriculturist owning land in village Samalka and other villages and was
interested to purchase more agricultural lands in Delhi. The Defendants
offered to sell their 15 Bighas and 4 Biswas of land only situated in the
revenue estate of village Pandawla Kalan, New Delhi, at the rate of Rs.
2,55,00,000/- per acre of 4840 sq. yds., thus the total of 15 Bighas and 4
Biswas value at Rs. 8,07,50,000/-, to the plaintiff.
3. One company M/s Raisina Villas Pvt. Ltd., through its director Sh.
Rajeev Aggarwal, offered to join the Plaintiff in the purchase of the
abovementioned land. Consequently, at the time of purchasing the land, M/s
Raisina Villas Pvt. Ltd. handed over 05 Pay Orders bearing nos. 07767,
07768, 07766, 07765 and 53808 which were drawn on HDFC Bank, of Rs.
9,00,000/-, in favour of each Defendant, i.e. for a total sum of Rs.
45,00,000/-. The Plaintiff had given the remaining sum of 35,75,000/- to the
Defendants at the time of entering into agreement. Accordingly, upon
receiving the total amount of Rs. 80,75,000/-, the Defendant executed an
Agreement to Sell and receipt dated 18.07.2007, in favour of the Plaintiff
and M/s Raisina Villas Pvt. Ltd.
4. It is further submitted that as per the Agreement to Sell dated
18.07.2007, the seller was required to obtain a ‘No Objection Certificate‟
from the Revenue Authorities and Land Acquisition Collector.
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5. The Plaintiff claimed that on 18.07.2007, he handed over the duly
filled and signed NOC Forms to the Defendants for obtaining the NOC from
the Revenue Authorities and Land Acquisition Collector. However, the
Defendants neither applied nor intimated the Plaintiff regarding the same.
6. Further, the Defendants sent a Legal Notice Dated 06.06.2008,
called upon the Plaintiff to obtain the NOC and execute the Sale Deed or
otherwise they would have to suffer the forfeiture of the advance amount,
paid by the Plaintiff, i.e. Rs. 80,75,000/-. However, as per the Agreement,
the Defendants were bound to obtain the NOC and other clearances.
Moreover, the Defendants were facing difficulty in obtaining NOC, as they
held other land in the same Village, and unless they sold or transferred the
entire land, which was less than 08 standard acres, they could not obtain the
NOC for the Agreement to Sell dated 18.07.2007, in terms of Section 33 of
the Delhi Land Reforms Act, 1954.
7. Accordingly, the Plaintiff sent a Reply on 30.06.2008, wherein the
Plaintiff made clear to the Defendants that he is willing to comply with the
Agreement dated 18.07.2007 and he has sufficient finances for the same.
8. The Plaintiff also claimed that despite repeated requests, the
Defendants neglected to obtain the NOC, because the prices of the land in
that particular area were steadily rising and the Defendants hoped for finding
some other buyer, at a higher price value.
9. In November 2009, the Plaintiff came to know that the Defendants
were negotiating for the sale of land with some other buyers. The Plaintiff
thus, contacted the Tehsildar and other authorities, requesting them to not
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issue NOC in favour of anyone else, as the Plaintiff held a valid and
subsisting Agreement with the Defendants.
10. Therefore, the Plaintiff in fear of not obtaining land without
protracted litigation and also the violation of Section 33 of Delhi Land
Reforms Act, 1954, sought refund of the advance amounts/ earnest money
paid to the Defendants, in furtherance of the Agreement to Sell dated
18.07.2007.
11. In the meantime, the Plaintiff claimed that he had settled with M/S
Raisina Villas Pvt. Ltd. and refunded the contribution of Rs. 45,00,000/- in
their joint purchase under Agreement to Sell dated 18.07.2007, for obtaining
the rights to purchase the entire aforementioned land. Thus, the Plaintiff is
entitled to seek specific performance from the Defendants. Moreover, the
Plaintiff being a joint-purchaser, is entitled to sue in his own right to recover
the entire sum as the Agreement could be termed as a partnership for a
particular transaction.
12. Thus, the Plaintiff filed a Suit for Recovery of Rs. 1,09,82,000/-
along with pendente lite and future interest till recovery @ 12 % per annum
from 18.07.2007 till filing of the Suit, i.e. 16.07.2010.
13. The Defendants in their Written Statement stated that the present
suit is not maintainable, as the parties to the Suit are governed by the terms
of the Agreement to Sell dated 18.07.2007, and the relief sought by the
Plaintiff was beyond the terms of the contract. The contract did not confer
any right upon the Plaintiff for recovery of money and as such, no right for
recovery of the amount had arisen under this Agreement to Sell dated
18.07.2007. As per this Agreement, the earnest money was to stand forfeited
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in case the Plaintiff did not perform his part of the contract. Further, the
Defendant alleged that the Plaintiff had never shown any readiness and
willingness to perform his part of the contract, at any point of time.
14. It was also submitted that the present Suit was barred by limitation,
as the Plaintiff did not take the appropriate steps during the stipulated period
of time, in terms of the Agreement to Sell dated 18.07.2007. Although, the
Defendants admitted taking Rs. 80,00,000/- by way of cash and cheque,
however, the receipt of Rs. 75,000/- in cash, was denied by the Defendants.
15. Further it was submitted, that as per para 7 of the Agreement to Sell,
both the parties were required to obtain the NOC from the Tehsildar or other
concerned authority at the cost of second party. The Agreement to Sell was a
bilateral transaction and cooperation of both the parties was required in
obtaining the NOC or any other permission. However, the Plaintiff neither
approached the Defendants for obtaining the NOC, nor handed over the
NOC Forms with his signatures to the Defendants, for the purpose of
obtaining NOC. Moreover, the Plaintiff was required to pay the entire
balance sale consideration amount within 03 months from the date of the
Agreement to Sell; the insistence on obtaining the NOC without paying the
entire balance consideration amount, was unjustified.
16. Further, it is alleged by the Defendant that the Plaintiff is a property
dealer, and not a bonafide purchaser of the aforesaid land in question, and as
such, avoided the completion of sale transaction. It was claimed that the Suit
of the Plaintiff was liable to be dismissed.
17. The Plaintiff in his Replication, reiterated the averments made
in the Plaint and stated that the NOC, as per law, needed to be acquired by
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the seller from the Revenue Authorities and Land Acquisition Collector,
before execution of the Sale Deed. The Plaintiff himself had handed over the
duly filled and signed forms to the Defendants on the day of execution of the
Agreement dated 18.07.2007. The Defendants, with a malafide intention,
had sent the Legal Notice dated 06.06.2008, in order to avoid their
responsibility by asserting that the Plaintiff had not signed the NOC forms
for the execution of the agreement.
18. The Issues on the pleadings were framed on 06.03.2012, as under:
1) "Whether the suit is barred by time? OPD.
2) Whether the plaintiff had committed breach of his
obligation as contained In Agreement to Sell dated
18.07.2007? OPD.
3) Whether the suit is without any cause of action? OPD
4) Whether the plaintiff has settled the matter with M/s
Raisina Villas Pvt. Ltd.? If so, its effect? OPP.
5) Whether the plaintiff is entitled to suit amount? OPP.
6) Whether the plaintiff is entitled to interest? If so, its
effect? OPP.
7) Relief."
19. The Plaintiff Jagdev Sharma expired on 25.05.2012, and vide order
dated 04.03.2015, his LRs were impleaded as parties.
20. The Plaintiffs in support of their case, examined PW1 Sh.
Sanjeev Kumar, who by way of evidence affidavit Ex. PW1/1, reiterated the
assertions made in the Plaint.
21. PW2 Sh. Rajesh Kumar, was authorized vide the Board Resolution
dated 06.11.2017, who deposed that he was a witness to the execution of
Agreement dated 18.07.2007, and identified his signatures, as well as the
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signatures of late Sh. Jagdev Sharma. He also deposed that Sh. Rajeev
Aggarwal had made a handwritten acknowledgement of the Receipt of Rs.
45,00,000/-, wherein he settled his claim on the Agricultural land Ex.
PW2/2.
22. PW3 Sh. Rajeev Pandey, was also a witness to the execution of
Agreement dated 18.07.2007, on which he identified the signature of Sarjeet
Sharma, Jagdish Sharma, Krishan Kumar, Virender and Vijay Kumar.
Further, he also deposed that the Defendants had obtained sums of Rs.
35,00,000/- and Rs. 75,000/- in cash from Plaintiff and also obtained Pay
Orders of Rs. 45,00,000/- before signing the receipt dated 18.07.2007 Ex.
PW-3/2.
23. The Defendants in order to prove their case, examined DW1
Sarjeet Sharma, who tendered his evidence by way of affidavit Ex. DW1/A
wherein he reiterated the averments made in the Written Statement.
24. DW2 Sh. Raj Kumar from the office of Sub-registrar, Dwarka,
proved the Sale Deed dated 21.06.2012 and 25.02.2012 respectively, as Ex.
DW1/1 and Ex. DW1/2.
25. DW3 Ashok Kumar, who was the broker between the parties,
deposed that the Plaintiff first approached him in May 2007, at which point
he introduced the Plaintiff to the Defendants regarding the purchase of the
aforesaid agricultural land. Further, he confirmed the negotiations and the
execution of the Agreement to Sell dated 18.07.2007. However, he further
deposed that the Defendants’ signatures were obtained on a combination of
blank and partially typed papers. Additionally, he stated that while no cash
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was exchanged on the day the Agreement was signed, the Plaintiff made
partial payments at a later date.
26. The Learned District Judge after appreciating the evidence,
observed that Defendants have miserably failed to prove any loss caused to
them on account of failure of the execution of the Sale Agreement. DW1
Sh. Sarjeet Sharma in his cross examination, deposed as under:
“….We are still recorded owners of the suit property.
I am not ready to sell the suit property at the rates
mentioned in agreement Ex.P1. It is for the reason
that now the rates have increased and today I have no
need to sell the land. We are not concerned with rates
now nor we are not in need of money. It is correct that
at the time of execution of Ex.P1 we were in need of
money.”
Therefore, the learned Additional District Judge decreed the Suit of the
Plaintiff for recovery of Rs. 80,75,000/- along with the interest @ 7% per
annum from the date of filing of the Suit till its realization and pendente-lite,
vide Judgment dated 24.09.2022.
27. Aggrieved by the impugned Judgment dated 24.09.2022, the
present Appeal has been preferred by the Defendants/Appellants on the
grounds that the learned Trial Court has erred in holding that the Suit is not
barred by limitation. The date of institution of Suit is 19.07.2010 whereas
the Agreement to Sell is dated 18.07.2007, hence, the Suit is barred by
limitation.
28. Secondly, the Plaintiff is the dominis litis; he had discretion and
option to sue for the recovery of earnest money and not for Specific
Performance of the Agreement to Sell dated 18.07.2007. However, the
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Agreement to Sell, itself provided a remedy, which was to file a Suit for
Specific Performance in the event of breach of the Agreement, and parties
are bound by the terms of the contract.
29. Thirdly, the learned Additional District Judge erred in holding that
the Plaintiff could not file the Suit for Specific Performance because of the
bar envisaged in Section 33 of the Delhi Land Reforms Act, 1954. However,
the bare perusal of the averments in the plaint, reveals that NOC could not
be obtained due to violation of Section 33 of Delhi Land Reforms Act.
Further, it was admitted that Section 33 can be avoided if the Defendants
transfer the entire land, which reflects a contradiction in the pleadings.
30. Furthermore, the learned Additional District Judge erred in holding
that the Defendants were not competent to execute the Sale Deed, to which
effect no document is on record by the Plaintiff to prove otherwise.
31. Fourthly, learned Trial Court erred in holding that there was a
breach of Agreement on the part of the Defendants, as they did not
cooperate in obtaining the NOC. It was not the case of the Plaintiff that the
Defendants refused to sign the papers, as and when presented by the
Plaintiffs. Moreover, the PW-1 in his testimony has testified that “I did not
take any steps for obtaining the NOC”, and further testified that no written
communication was made to the Defendants between the period 18.07.2007
to 06.06.2008, asking Defendants to come forward for the execution of the
sale deed.
32. Fifthly, learned Trial Court perversely held that the if a Suit for
Specific Performance would have been filed by the Plaintiff, no relief could
have been granted to him, as he had to bear the consequences of Section 33
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of Delhi Land Reforms Act. This finding is against the admission of the
plaintiff/respondents as the bar of Section 33 of Delhi Land Reforms Act,
1954 could have been avoided, as stated by the plaintiff in his plaint, itself.
33. Sixthly, the learned Trial Court erred in holding that the Defendants
had tried to confuse Court by taking the objection of Section 69 of Indian
Partnership Act with reference to Agreement dated 07.11.2007, which was
executed between the Plaintiff and M/s Raisina Villas Pvt. Ltd, and
therefore, as per para no.17 of the plaint, it was admitted by the Plaintiff that
this partnership was termed as a „Partnership‟ for this particular transaction
and it has no reference to the Agreement to Sell and Receipts Ex. PW-3/1
and Ex. PW-3/2 respectively, and as such the finding of the learned Trial
Court, regarding the objection of section 69 of Indian Partnership Act, with
reference to Agreement to Sell and receipt dated 18.07.2007, is contrary to
the facts admitted by the Plaintiff in the plaint.
34. Seventhly, learned Trial Court erred in its interpretation of Section 5
of the Delhi Land (Restrictions on Transfer) Act, 1972, by observing that the
Defendants were required to obtain a NOC and that their failure to do so,
constituted a breach of contract. However, a bare perusal of Sections 4 and 5
would reflect that Defendants were not required to obtain NOC.
35. It is therefore, submitted that the impugned judgement, be set aside.
Submissions heard and record perused.
36. The first objection taken by the Appellant is that the Suit was barred
by Limitation. It is claimed that the parties entered into the Agreement to Sell
on 18.07.2007, while the Suit for Recovery was instituted on 19.07.2010.
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The period of limitation of three years, must be computed from the date of
the Agreement to Sell and the Suit was time barred.
37. This contention, however, proceeds on an erroneous assumption that
the cause of action for recovery of the advance amount, arose on the date of
execution of the Agreement to Sell, i.e. 18.07.2007. Article 58 of the
Schedule of Limitation Act, 1963, provides that the period of limitation is
three years and it has to be reckoned from “when the facts entitling the
Plaintiff to have the instrument or decree cancelled or set aside for the
contract rescinded first became known to him.” Therefore, in a contract of
sale, the right to sue for damages or refund of advance accrues, when the
contract is repudiated or the promisor refuses or becomes unable to perform,
and not on the date of the contract itself.
38. In the present case, the Agreement between parties for the
completion of the sale was within a period of three months from the
Agreement to Sell dated 18.07.2007, inter alia to obtain the requisite NOC
from the Revenue Authorities and the Land Acquisition Collector.
39. The first clear assertion of forfeiture and denial of the Plaintiff’s
rights, is contained in the Legal Notice dated 06.06.2008, whereby the
Defendants called upon the Plaintiff to execute the sale deed, failing which
the amount of Rs. 80,75,000/- would stand forfeited. The plaintiff
immediately repudiated the wrongful demand and forfeiture by Reply dated
30.06.2008 and called upon the Defendants to perform their obligations
under the Agreement.
40. On these facts, the earliest possible date on which the Plaintiff’s
right to sue had first accrued, is the date when the Defendants refused or
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failed to perform, that is, on or after the Legal Notice dated 06.06.2008.
Therefore, even if the strictest possible view is taken and the cause of action
is reckoned from the date of the Notice dated 06.06.2008, the Suit was filed
on 19.07.2010, which is well within the period of Limitation.
41. The next aspect which has been agitated by the
Appellants/Defendants is that in terms of Agreement to Sell dated
18.07.2007, the Plaintiff had an option to seek specific performance of
Agreement, but he has chosen to seek recovery of the money paid
thereunder.
42. Reliance is being placed on Clause 8 of the Agreement to Sell which
specified that in the event of breach of Agreement, the aggrieved party shall
be entitled to seek specific performance and the earnest money may be
forfeited if the purchaser fails to pay the balance consideration.
43. The pertinent questions, therefore, to be considered are whether the
Plaintiffs should have exercised the remedy of seeking specific performance
of the Agreement to Sell or whether the Plaintiffs were justified in seeking
recover of the money paid under the Agreement to Sell on account of the
non-compliance of the requisite pre-conditions by the Appellants. In order to
appreciate this contention, it is pertinent to refer to the Agreement to Sell
dated 18.07.2007, which was in respect of the agricultural land. It was
undeniable that NOC was required for sale of the agricultural land. The
Clause 7 of the Agreement to Sell reads as under:-
“7. That the first party and second party shall apply
obtain the No Objection Certificate from the Tehsildar
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to sell the said land in favour of the second party or the
nominee/s at the cost of the second party.”
44. This Clause reflects that both the parties were required to cooperate
with each-other to ensure that the NOC was obtained. The Plaintiff in his
testimony had deposed that NOC was required to be obtained by the
Defendants before execution of the Sale Deed. The requisite duly filled and
signed NOC forms were supplied to the Appellants/Defendants on
18.07.2007 itself for procuring the NOC. Though the Defendants neither
applied nor intimated the Plaintiffs about having obtained the NOCs.
Despite repeated reminders, the Defendants failed to obtain the NOC or
furnish the copy of the same to the Plaintiffs.
45. The defence taken by the Appellants was that it was the Plaintiffs
who had not provided the requisite forms and fault was with the on the
Plaintiffs on account of which the Agreement to Sell could not be executed.
To corroborate their defence, the Defendants/Appellants had relied upon a
Legal Notice dated 06.06.2008 Ex.P-2 wherein it was admitted the execution
of Agreement to Sell but claimed that the formalities of like NOC, ITCC,
etc., was to be obtained within three months from July, 2007 but the
Plaintiffs failed to approach the Defendants within the stipulated time for the
reasons best know.
46. It was further asserted that the Defendants had gone to the office of
Sub-Registrar on 30.07.2007 for execution of the Sale Deed, but none
appeared on behalf of the Plaintiffs, which reflected that they were not
willing to complete their part of the transaction. Hence, it was stated that
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within one month, the sale transaction be completed, failing which the
earnest money shall stand forfeited and the sale transaction cancelled.
47. The Plaintiffs had given a Reply dated 30.06.2008 wherein he had
refuted all the averments made in the Legal Notice. It was further asserted
that the formalities of obtaining NOC from the Revenue Department, ITCC,
etc., was upon the Defendants which they had failed to complete despite
repeated requests and it was re-affirmed that the Plaintiffs were ready and
willing to perform their part of the Agreement.
48. The learned District Judge has referred to this evidence and
concluded that as per Section 5 of Delhi Lands (Restriction on Transfer)
Act, 1972, it was the obligation of the seller to obtain the requisite
permission before sale of land. The learned Trial Court, therefore, noted that
the responsibility of obtaining NOC was of the Defendants. In this context,
it is also relevant to refer to Section 33 of Delhi Land Reforms Act, which
reads as under:-
“Section 33. Restrictions on the transfers by a
Bhumidhar .-
(1) No Bhumidhar shall have the right to transfer by
sale or gift or otherwise any land to any person, other
than a religious or charitable institution or any person
in charge of any such Bhoodan movement, as the Chief
Commissioner may, by notification in the Official
Gazette, specify, where as a result of the transfer, the
transferor shall be left with less than eight standard
acres in the Union Territory of Delhi:
Provided that the Chief Commissioner may exempt
from the operation of this section, the transfer of any
land made before the 1st day of December, 1958, if the
land covered by such transfer does not exceed one
acre in area and is used or intended to be used forRFA 666/2022 Page 15 of 20
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purposes other than those mentioned in clause (13) of
section 3.
(2) Nothing contained in sub section (1) shall
preclude the transfer of land by a Bhumidhar who
holds less than eight standard acres of land, if such
transfer is of the entire land held by him;
Provided that such Bhumidhar may transfer a part of
such land to any religious or charitable institution or
other person referred to in sub section (1).
49. From the bare perusal of Section 33, it is evident that no Bhumidar
could sell or transfer his land where as the result of transfer, the transferor
would be left with less than 08 standard acres of land in Delhi. Section 33(2)
further provided that this condition would not be applicable if the Bhumidar
who holds less than 08 acres of land transfers the entire land held by him. It
is, therefore, evident that there was an anticipated violation of Section 33
DLR Act, which has not been questioned in the pleadings or in the
testimony of the PW1. Therefore, the obligation was on the
Defendants/Appellants to obtain the NOC, which they have failed to obtain.
50. The specious contention has been raised by the Appellants that the
bar of Section 33 could have been overcome by the sale of entire land
holding as had been stated by the Plaintiffs/Respondents themselves.
However, it is the Appellants who were the owners of the land and it was for
them to overcome the restrictions of Section 33 DLR Act by having obliged
to sell the entire land holding if it was less than 08 acres. It was not in the
hands of the Plaintiffs to overcome this restriction without the land being
offered by the Appellants for sale.
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51. However, as held by this very Court in Umesh Gaur (Deceased)
through LRs v. Shamsher Rana & Anr 2018:DHC:1161 and in M/s Shri
Neelpadmaya Consumer Products Pvt. Ltd. v. Satyabir & Ors
2016:DHC:882, the bar under Section 33 operates at the stage of actual
transfer of Bhumidhari rights and does not render an Agreement to Sell per
se void or incapable of enforcement amongst the parties.
52. The learned Trial Court therefore, rightly concluded that there was
nothing brought on evidence to reflect that it was the Plaintiffs who failed to
perform his part of the Agreement rather the overwhelming evidence
reflected that Appellants failed to produce any evidence to show that he ever
applied for NOC before the concerned authorities or that he was unable to
get the NOC on account of non-cooperation of the Plaintiffs.
53. In this context, it may also be relevant to refer to Legal Notice dated
06.06.2008 of the Appellants wherein while claiming that the Plaintiffs had
not obtained the NOC, he in the same breath stated that he had gone to the
office of Sub-Registrar, but Plaintiffs failed to appear for the purpose of
execution of Sale Deed.
54. This Legal Notice dated 06.06.2008 clearly shows that it was the
defence that was tried to be created by the Appellants despite being aware
that without the NOC or without execution of the draft Sale Deed, no
purpose would be served by going to the office of Sub-Registrar. Also
pertinently, no date of visit to the office of Sub-Registrar has been
mentioned. Additionally, there is no averment that a Notice was given to the
Plaintiff, to come in the office of Sub-Registrar for the registration of the
Sale Deed.
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55. Clearly, from the contents of Legal Notice dated 06.06.2008 given
by the Defendants, it is more than obvious that Defendants themselves had
failed to perform their part of the obligation under the Agreement to Sell to
get an NOC, but had tried to put the blame on the Plaintiffs.
56. The learned District Judge had rightly concluded that the breach of
terms of Agreement to Sell was with the Defendants and not with the
Plaintiffs.
57. Having so concluded, it is further pertinent to refer to the
contentions of the Respondents that apprehending the restrictions of Section
33 as there was no NOC, he did not want to ahead with the transaction and
be involved in the litigation and therefore, chose to return the money under
the Agreement to Sell.
58. In the above scenario discussed in detail, the Plaintiff was not
unjustified in seeking the refund of his earnest money.
59. The Plaintiffs had contended that in the Agreement to Sell, the mode
of performance itself was provided wherein it stated that either party would
have a right to seek specific performance for execution of Sale Deed or else
the Defendants would have a right to forfeit the earnest money if the
purchaser fails to pay the sale consideration.
60. It has been rightly submitted on behalf of the Plaintiff that this sale
could not have gone ahead in the absence of NOC.
61. The case in hand is not of failure of the Plaintiff to fulfill his
obligations or not pay the balance consideration but the pre-condition
requirement of getting an NOC was not satisfied by the Appellants, and
therefore, the Plaintiff was well justified in seeking the refund of money.
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Signed By:VIKAS
ARORA
Signing Date:23.04.2026
17:19:33
62. The Plaintiff was, therefore, justified in seeking the recovery of the
earnest money paid under the Agreement to Sell dated 18.07.2007.
63. The Appellant made another attempt to avoid his liability under the
Agreement to Sell by claiming that there existed a partnership between the
Respondent and M/s Raisina Villas Pvt. Ltd., which was not registered and
therefore, the bar of Section 69 Partnership Act was attracted and the Suit
could not have been filed by the Plaintiffs. The argument may seem
attractive, but it was completely misplaced. The Plaintiff had explained that
for the purchase of land, he had made the payment of Rs.80,75,000/- while
Rs.45,00,000/-were paid by M/s Raisina Villas Pvt. Ltd. and for the purpose
of this deal of purchase of land, they had entered into an Agreement which
was in the nature of partnership.
64. Clearly, from the averments made by the Plaintiffs, it is evident that
there was no partnership as understood under the Partnership Act that was
entered into between the parties, but they partnered together for the purchase
of the Sale Deed. Once there was no formal partnership, there was no
question of it being registered.
65. It may also be noted that while Rs.45,00,000/- had been paid by M/s
Raisina Villas Pvt. Ltd., but inter se the Plaintiff and M/s Raisina Villas Pvt.
Ltd. entered into an Agreement and the Plaintiff returned Rs.45,00,000/- to
M/s Raisina Villas Pvt. Ltd., and therefore, the Plaintiff alone became
entitled for the recovery of the entire amount.
66. This is a simpliciter case of recovery of the money paid by the
Plaintiff under the Agreement to Sell dated 18.07.2007 and because it failed,
the Plaintiff was rightly held to be entitled to the recovery of the amount.
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Signed By:VIKAS
ARORA
Signing Date:23.04.2026
17:19:33
67. Hence, there is no infirmity in the Judgment and decree passed by
learned Additional District Judge dated 24.09.2022, and therefore the
Appeal is hereby, dismissed.
68. Pending Application(s), if any, also stand disposed of accordingly.
(NEENA BANSAL KRISHNA)
JUDGE
APRIL 23, 2026
N
RFA 666/2022 Page 20 of 20
Signature Not Verified
Signed By:VIKAS
ARORA
Signing Date:23.04.2026
17:19:33