- (1.) THIS appeal came up for hearing on admission on 14th January, 2003 when the learned counsel for the parties agreed that the appeal should be heard finally at the stage of admission itself and was accordingly adjourned for final hearing. Appeal then came up for final hearing on 22nd January, 2003 and after hearing for sometime was adjourned several times for settlement. As the settlement was not possible, hearing was continued and concluded today. FACTS
(2.) FOR the sake of convenience, the parties are referred to by reference of their original status in the suit. The plaintiff is the owner of several properties hearing C. T. S. Nos. 150, 150/1 to 6, 151, 152, 152/1 and 2 together admeasuring about 6,251. 30 sq. metres and more particularly described in clause 1 of Exhibit A to the plaint which are hereafter referred to as the suit properties. The plaintiff is also the owner of some other properties in respect of which separate agreementls were executed between the parties but, which are not the subject matter of the suit. By an agreement dated 29/09/1986 executed by the plaintiff on the first part and promoters of defendant No. 3 company on the second part, the plaintiff agreed to entrust the development rights in respect of the suit properties in favour of defendant No. 3 which was then under incorporation. The defendant No. 3 company was subsequently incorporated and it is common ground between the parties that the agreement was thereafter regarded as an agreement entered between the plaintiff and the defendant No. 3 company and was acted as such. Under the said agreement, the defendant No. 3 agreed to pay the plaintiff the consideration calculated at Rs. 150/- per sq. ft of the Floor Space' Index (for short fsi) permitted for development by the Municipal Corporation of Brihan mumbai which is the defendant No. 1 in the suit. Clause 6 (a) of the agreement shows that a sum of Rs. 1,00,000/- was paid as earnest money and further sum of Rs. 7,00,000/- was to be paid by the developers (defendant No. 3) within a period of 30 days of the obtaining of the Intimation of development (for short IDD ). The entire balance except Rs. 50,000/- was to be paid within 30 days of the obtaining of the Commencement Certificate. The agreement contains usual clauses regarding the rights of defendant No. 3 to carry out the building construction and to sell flats, shops, offices etc in the buildings to be constructed on the suit properties and giving of Power of attorney by the plaintiff to the defendant No. 3 or its nominees. The agreement did not contain a clause of termination. On 19/11/1986 a supplementary agreement was executed between the plaintiff, on one hand and the promoters. of defendant No. 3 on the other hand under which all the terms and conditions of the previous agreement dated 29/09/1986 except to the extent modified by the supplemental agreement were to remain in force. Clause 3 of the supplemental agreement dated 19/11/1986 conferred a right and option to the plaintiff either to terminate the original agreement dated 29/09/1986 if, the defendant No. 3 did not pay the consideration within 90 days of the due date or to claim interest at 18% p. a. from the expiry of 90 days. In pursuance of the said agreement dated 2 9/09/1986 the plaintiff has executed a power of attorney in favour of three persons namely Mr. Waynee C. D. Lima and Mr. Julian A. D. 'souza and Mr. Sunil C. Preira who were the directors of defendant No. 3 company. The third attorney Mr. Julian A. D'souza was son of the plaintiff and has since died. The deed of power of attorney authorises the attorneys to do all necessary thing in furtherance of the agreement dated 29/09/1986 and specifically authorises the attorneys to appoint architects, engineers and surveyors. Before granting of the power of attorney on 3/08/1990 the plaintiff on the request of defendant No. 3 had submitted plans under his own signature to the defendant No. 1 municipal Corporation for sanction on 1/01/1990. In pursuance of the Commencement Certificate granted by the respondent No. 1 Municipal Corporation on 6/05/1994, the defendant No. 3 commenced the development of the property and part of the property has been developed. As per clause 6 of the agreement dated 29/09/1986, the defendant No. 3 ought to have paid the entire consideration except a sum of Rs. 50,000/- within 30 days of the obtaining of the Commencement certificate i. e. by 6/06/1994. Learned counsel for the defendant No. 3 submits that the plans were sanctioned for construction of 71,850 sq. ft. but the defendant No. 3 was to commence the work in stages under different Commencement Certificates issued on 25/11/1994. 2 3/12/1995 and 26/04/2001. The learned counsel for the defendant No. 3 has not given any particulars as to the FSI sanctioned at each stage. He is however submitted that the total F. S. I, sanctioned was 71850 sq. feet and consideration calculated at the rate of Rs. 150/- per sq. ft. of fsi would come to Rs. 1,07,77,500/ -. According to the defendant No. 3, it has so far paid to the plaintiff a sum of Rs. 62,12,000/- which is disputed by the plaintiff who claims to have received only Rs. 22,00,000/- in respect of the suit properties. According to the plaintiff, he has received some more money in respect of his other properties for which separate agreements were made with the defendant No. 3 Even if I were to assume that the defendant No. 3 has paid a sum of Rs. 62,12,000/- as contended by it, still there is a huge shortfall of more than Rs. 40,00,000/-which had to be paid within 30 days of the obtaining of the Commencement Certificate.
(3.) ACCORDING to the plaintiff, despite several requests and demands and writing of letters, the defendant No. 3 did not pay the balance consideration. Therefore, by a notice dated 3/12/1999 addressed to the defendant No. 3 and its directors the plaintiff terminated both the agreements (i. e. agreement dated 29/09/1986 and supplemental agreement dated 19/11/1986) and also revoked and cancelled the power of attorney/s executed in favour of the directors of defendant No. 3. In paragraph 8 of the notice, the plaintiff has enumerated several breaches of the agreement including non-payment of consideration and non-payment of municipal taxes agreed to be paid by the defendant No. 3. The plaintiff also wrote a letter to the defendant No. 1 municipal Corporation on 14/12/1999 intimating the termination of the agreements and the revocation of the power of attorney and also informing it that the attorneys whose authority was revoked were no longer entitled to represent the plaintiff. Prior to the termination of the agreement) Mr. G. D. Sambhare was appointed as an architect for supervising the construction by common consent of the plaintiff and defendant No. 3. In view of this termination and disputes between the plaintiff and defendant No. 3, by a letter dated 21/12/1999 Mr. Sambhare withdrew his supervision memo and resigned as the architect of the project. By a letter dated 3/01/2000, the defendant No. 1 municipal Corporation informed the plaintiff about the resignation of mr. Sambhare and requested him to appoint a new architect for supervising the construction. The plaintiff thereafter appointed one Mr. C. S. Mahajan as the architect of the project and informed the corporation about his appointment. The plaintiff also submitted a letter of "no objection" obtained from Mr. Sambhare for appointment of Mr. C. S. Mahajan, as required under rules of the defendant No. 1 Municipal Corporation.;