When the BDA rejected for plan approval
that the builder cannot escape from their liability to complete the project if
the adjacent land has been approved for the same builder.
The Hon'ble National Commission has clinched the above title and interpreted that no builder can escape from their liability once they have acted upon by promising to perform the contract if the alternative remedy was available for the builder to complete their obligation within the purview of the law.
The factual matrix of the case that the builder had been noticed by legal experts due to non-execution of
Sale Deed on behalf of the several Villa buyers because of the land for the
phase in which villas were allotted to the complainants was comprised in survey
Nos.112/P and 89/P of Boganahalli village and the building plans for the said
phase comprising 40 villas were rejected by Bangalore Development Authority
vide letter dated 11-09-2006. A perusal of the aforesaid letter would show that
the building plan for construction of residential complex on the aforesaid land
were rejected solely on the ground that a major portion of the said land was
reserved for the proposed road and a portion was reserved for residential
purpose in RCDP – 1995
The complaints have been resisted by the opposite parties
primarily on the ground that the allotment to the complainants was made subject
to approval of the plans by the concerned authorities and the plans submitted
by them to Bangalore Development Authority were not approved by the said
authority, on the ground that in the Comprehensive Development Plan (RCDP-1995)
substantial portion of the land on which villas in question were to be
constructed was reserved for a road. It is further stated in the reply that as
per the current master plan (revised master plan-2015) which came into force on
25-06-2007 the land in question is classified as industrial and residential use
is permitted only as an ancillary use in the said hi-tech zone. According to
the opposite parties, the contract between the parties was a contingent
contract, performance of which has become impossible. It is further stated in
the reply that way back in 2007 the complainants were informed that they could
take refund of their money along with interest.
The learned counsel for the opposite parties, in support of his
contention that the forum cannot direct execution of a contract which had
become impossible to perform even if such a performance becomes possible at a
later date referred to the decision of the Hon’ble Supreme Court in K.
Narendra Vs. Riviera Apartments (P) Ltd., 1999 (5) SCC 77; 2001 (5) SCC (101),
Her Highness Maharani Shantidevi P. Gaikwad Vs. Savjibhai Haribhai Patel &
Ors. He also referred to
the decisions of the Hon’ble Supreme Court in 1973
(2) SCC 746, Har Prasad Choubey Vs. Union of India & Anr. and 1969 1 SCR 65, Boothalinga
Agencies Vs. V.T.C. Poriaswanmi Nadar. He
also placed reliance upon the decision of Delhi High Court in AIR 1986 Del 158, Punj Sons Pvt.
Ltd. Vs. Union of India. However,
none of these judgments would apply considering that we are proceeding on the
assumption that on account of the refusal of the Bangalore Development
Authority to sanction the plans for construction of villas on the land
comprised in survey No.89 and 112, the contract between the parties had become
void in terms of Section 56 of the Contract Act and considering the stand taken
by the opposite parties that no villa is available with them for providing to
the complainants we do not propose to direct the opposite parties to either
construct villas or to provide readymade villas to the complainants. But It transpired during the course of hearing
that after denying the villas booked by the complainants to them, the opposite
parties got approved building plans for construction of villas on the land adjoining
the land comprised in survey No.112 & 89. Therefore, the BDA has only
rejected to issue plan approval for comprised survey Nos.112/P and 89/P.
Even if we proceed on the assumption that on account of refusal of
Bangalore Development Authority to sanction building plans on the entire land
comprised in survey No.112 and 89, the contract between the parties to sell
villas in question to the complainants had become impossible to perform, the
complainants are entitled to compensation in terms of Section 56 of the
Contract Act since in our view, the opposite parties knew or with reasonable
diligence might have known but the complainants did not know that the villas in
question could not have been constructed on the land comprised in survey No.112
and 89. Besides their right under the provisions of Contract Act the
complainants are also entitled to suitable compensation under the provisions of
Consumer Protection Act on account of deficiency/negligence in the services
rendered to them by the opposite parties. The Forum confirmed that the builder
has to pay compensation to the complainants as per the terms of the order.
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