Full Judgment Text
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.4997 OF 2016
(ARISING OUT OF SLP(C) NO.32544 OF 2015)
MUKUL SHARMA ....APPELLANT
VERSUS
ORION INDIA (P.) LTD. THROUGH ITS
MANAGING DIRECTOR ...RESPONDENTS
J U D G M E N T
Leave granted.
2. The appellant filed Title Suit No.195 of 1998 before
the Civil Judge (Senior Division) No.1 at Guwahati
praying for specific performance of the instrument
dated 25.8.1992 between the appellant and the respondent.
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3. The dispute is only on a narrow compass. As per
paragraph (1) of the aforesaid agreement, half of the
built up area on the ground floor of the proposed North
Block of the complex as per the drawing No.GBA/891/03A
dated 14.12.1990 and half of the built up area on the
mezzanine floor of the same building and complete built
up area on the first floor in the same building, were
liable to be handed over to the appellant. On a dispute
as to what is the built up area, the appellant filed the
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civil suit. The suit was decreed. Aggrieved by the same,
the respondent-defendant filed first appeal before the
High Court. The following points for determination were
found to arise in the first appeal :
(i) Whether the parties had entered into
agreement knowing that 'built up area' as
mentioned in Ext.1 agreement includes the
common area?
(ii) Whether the plaintiff is entitled to
specific performance as claimed?
(iii) Whether plaintiff is entitled to a money
decree as prayed for?
4. As per the impugned order, the High Court has taken
the view that the built up area includes the common area
as understood by the parties. Reliance is placed on
Ex.'H' letter dated 15.9.1997 written by the
appellant-plaintiff to the respondent-defendant. As per
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the said letter, indisputably, the built up area has been
understood to include the common area.
5. However, the High Court has failed to appreciate
Ex.3 letter dated 9.3.1998 and Ex.4 letter dated
16.3.1998 in the correct perspective. The relevant
portion of annexure Ex.3 letter dated 9.3.1998 reads as
follows :
“(1) That the “built-up area” as in
clause 1(i), (ii) & (iii) of the Agreement
between yourself and the Company (Deed No.5581
dated 25/8/98) should be defined as “the area
within the four walls excluding the common area
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as lift well, lobby, corridor, etc.
(2) That our method of calculation and the area
so calculated is not acceptable to you.
Since we wish to resolve this long outstanding
issue as early as possible, we agree to your
definition of “built-up area” and shall
recalculate the area to be allotted to you and
shall inform you shortly.”
6. This was followed by Ex.4 letter dated 16.3.1998
wherein it is stated in the very opening paragraph of the
said letter as follows :
“Further to our letter No.ORION/44-1/98/028
dt.9/3/98, we furnish below the built-up areas
calculated for drg. Nos.GBA/891/03A,
GBA/891/04A and GBA/891/05A using our accepted
definition of “built-up area”. Please note that
all common area such as lift well, corridor,
lobby, duct, etc., have been excluded as
suggested by you.”
(All emphasis supplied)
7. It is unfortunate that the High Court has gone by
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the earlier understanding of the plaintiff on the concept
of built-up area and wholly ignoring the understanding
mutually entered into between the plaintiff and the
defendant on a later date. According to the High Court,
since the plaintiff had once accepted the position that
built-up area included common areas, he is always bound
by the same. If plaintiff had once accepted the position
in regard to the concept of 'built-up area' he cannot
resile subsequently in view of bar under section 5 of the
Indian Contract Act, 1872, once offer and acceptance is
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complete, it is held.
8. The relevant consideration by the High Court at
para 26 of the impugned judgment reads as follows :
“If Ext.3 and Ext.4 are studied and compared it
would appear that prima facie, defendant
undertook to accept the definition of 'built up
area' given by the plaintiff and therafter
deferred the matter for recalculation of the
entitlement on the light of such definition. But
in the subsequent communication, the defendant
made recalculation as to entitlement of the
plaintiff by applying his own definition of the
'built up area' and thus included common areas in
the 'built up area'. This letter was written on
16.3.1998. But prior to that it is the plaintiff
who had accepted the concept of 'built up area'
as given by the defendant in his letter dated
15.9.1997 and made his own calculation about the
entitlement of 'built up area'. According to the
version of the plaintiff in the said letter dated
15.9.1997 (Ext.H), he was allotted possession of
8726.43 sq.ft of 'built up area' in total in
three floors, namely, first floor, mezzanine
floor and the third floor. Out of this total
'built up area' of 8726.43 sq.ft., plaintiff
himself admitted in the said letter that there
was 558.19 sq.ft. common area in the first floor,
544.74 sq.ft common area in the mezzanine floor
and 540 sq.ft in the third floor. Thus, out of
8726.43 sq.ft 'built up area' handed over to the
plaintiff, there was 558.19 sq.ft + 554.74 sq.ft
+ 540 sq.ft = 1652.93 sq.ft common areas and
balance 7083.50 sq.ft under exclusive possession
of the plaintiff. The plaintiff after showing
this calculation claimed thereafter that he was
still entitled to 3445.57 sq.ft in the top floor
i.e. eighth floor. The sum of 8726.43 sq.ft +
3445.57 sq.ft is 12172 sq.ft and so there is
logic behind this calculation shown by the
plaintiff. Once this calculation is accepted, it
is clear that prior to issuance of letter
9.3.1998, the plaintiff had accepted the
proposition that built up area would include
common areas. If plaintiff had accepted the
proposition of the defendant in regard to concept
of 'built up area' he cannot resile subsequently
in view of bar under section 5 of the Indian
Contract Act, 1872.”
JUDGMENT
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9. It is not a case where the plaintiff resiled from
the agreement. It is a case where the defendant himself
subsequently accepted the dispute raised by the plaintiff
with regard to the concept of 'built-up area'. In express
terms, the respondent-defendant has subsequently agreed
that the built-up area will not include the common area
like lift well, corridor, lobby, duct, etc. Admittedly,
the expression “built up area” is not defined in the sale
deed. It is something to be deciphered from the conduct
of the parties. No doubt, the appellant plaintiff had,
after five years of the sale deed, as per letter Ex.'H'
dated 15.9.1997 understood the built up area as including
common area. But subsequently, he disputed the position
and it was the respondent-defendant who accepted and
agreed to the position that built up area does not
include common area. It is not as if an attempt is made
for interpreting the express terms of an agreement, by
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subsequent conduct. It is a situation where there is a
dispute on a concept relating to an expression/concept
which is not explained in the agreement. The plaintiff
had initially understood the concept in a particular
angle or manner. But that does not prevent him from
raising a dispute. And on raising such a dispute, nothing
prevented the defendant from insisting the plaintiff to
stick to his original stand. On the contrary, it is the
defendant who changed his stand as per Ex.3 and Ex.4 and
accepted the position as raised by the plaintiff.
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Thereafter and therefor, under the true spirit of
section 5 of the Contract Act, defendant cannot resile
from the mutually agreed position.
10. In Abdulla Ahmed vs. Animendra Kissen Mitter – AIR
1950 SC 15, this Court has dealt with a similar situation
and it has been held that “
“Extrinsic evidence to determine the effect of
an instrument is permissible where there remains
a doubt as to its true meaning. Evidence of the
acts done under it is a guide to the intention
of the parties in such a case and particularly
when acts are done shortly after the date of the
instrument.”
This was followed in The Godhra Electricity Co. Ltd
& Anr. vs. The State of Gujarat & Anr. - AIR 1975 SC 32 :
“In these circumstances, we do not think we will
be justified in not following the decision of
this Court in Abdulla Ahmed vs. Animendra
Kissen Mitter – 1950 SCR 30 at p.46 = (AIR 1950
SC 15 at p.21), where this Court said that
extrinsic evidence to determine the effect of an
instrument is permissible where there remains a
doubt as to its true meaning and that evidence
of the acts done under it is a guide to the
intention of the parties, particularly, when
acts are done shortly after the date of the
instrument.”
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11. We, accordingly, allow this appeal, set aside the
impugned judgment of the High Court with regard to the
finding on the 'built-up area' and restore that of the
trial court.
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12. We find that the High Court has remanded the matter
to the trial court for the purpose of calculation of the
built up area to be handed over to the
plaintiff-appellant. We direct the trial court to make
the calculation in terms of this judgment and
accordingly, dispose of the suit expeditiously.
No costs.
.........................J
[KURIAN JOSEPH]
..........................J
[ROHINTON FALI NARIMAN]
NEW DELHI;
MAY 10, 2016.
JUDGMENT
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