Rajesh Sarkar (M/S Sarkar Construction) vs. Smt. Bela Rani Bose

Held

The Court held that the appellant, having received the entire sale consideration and other amounts for furnishing, and by executing the MoU that preponed the delivery date to December 2019, was estopped from claiming an automatic extension of time to hand over possession based on the RERA registration period or COVID extensions. The Court applied the principle of promissory estoppel, citing M/s. Motilal Padampat Sugar Mills Co. Ltd. Vs. State of Uttar Pradesh & ors., stating that the parties altered their position by the execution of the MoU, creating a legal obligation for the appellant to hand over possession by December 2019. The Court agreed with the Appellate Tribunal that the RERA's finding regarding the respondent's failure to serve notice was faulty, as neither the agreement nor the Act of 2016 contemplated such a requirement. The Court found no perversity in the Appellate Tribunal's appreciation of evidence, including the correspondence showing the appellant's contradictory stand (offering flat No. 501 with a significantly lower sale consideration and then offering flat No. 105), which supported the Appellate Tribunal's decision in favor of the respondent. The Court found no substantial question of law arising from the facts and dismissed the appeal. The Court also directed that if execution proceedings are filed, they should be concluded within two months, considering the respondent's age.

Facts

The appellant, Rajesh Sarkar (M/s. Sarkar Construction), entered into an agreement with the respondent, Smt. Bela Rani Bose, on October 23, 2018, to sell her flat No. 105 for Rs. 65,16,000/-. The agreement stipulated possession by February 20, 2022, but a subsequent Memorandum of Understanding (MoU) on the same date committed to delivery by December 2019. The appellant failed to deliver by December 2019. The respondent, an 84-year-old senior citizen, had paid the entire sale consideration and furnishing costs. The appellant later offered flat No. 501, which was mortgaged, and sent a sale deed format showing a consideration of Rs. 25,79,000/-. The respondent filed a case before the Real Estate Regulatory Authority (RERA), which directed the registration of either flat No. 105 or 501. The Chhattisgarh Real Estate Appellate Tribunal, in its impugned order, directed the return of the entire Rs. 65,16,000/- with 10.50% interest and costs. The appellant is aggrieved by this order.

Key Issues

1. Whether the appellant is estopped from claiming an extension of the possession date beyond December 2019, despite the RERA registration period extending to June 2022 (with a COVID-related extension), based on the execution of the MoU and the principle of promissory estoppel? - Petitioner's argument: The appellant contends that the MoU preponed the delivery date, and having received the entire sale consideration, they are bound by this promise. They argue that the RERA registration validity and COVID extensions should not override the specific commitment in the MoU. They are ready to execute the sale deed for flat No. 105. - Respondent's argument: The respondent argues that the appellant failed to deliver possession by December 2019 as promised in the MoU after receiving the full payment. They highlight the appellant's inconsistent offers (flat No. 501 with a lower sale consideration, then flat No. 105) and the appellant's inability to complete the flat due to lack of funds. They also argue that the RERA's finding that the respondent failed to serve notice for sale was faulty and rightly set aside by the Appellate Tribunal. 2. Whether the finding of the RERA that the respondent (purchaser) had not made any effort to serve a notice to the appellant is faulty? - Petitioner's argument: Not explicitly recorded. - Respondent's argument: The respondent argues that the agreement and the Act of 2016 do not contemplate such a requirement for notice, and the Appellate Tribunal rightly set aside this finding.