Delhi High Court
Pallippuram Ramakrishnan … vs Anand Divine Developers Private … on 3 September, 2024
Author: C. Hari Shankar
Bench: C. Hari Shankar
$~
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on : 10 July 2024
Pronounced on : 3 September 2024
+ OMP (ENF.) (COMM.) 148/2021 & CCP(O) 9/2024,
CRL.M.A. 1903/2023, EX.APPL.(OS) 2751/2022,
EX.APPL.(OS) 78/2023
ANAND GUPTA & ANR. .....Decree Holder
Through: Mr. Saif Khan, Mr. Swastik
Bisarya, Mr. Achuthan Sreekumar, Mr.
Rohil Bansal and Ms. Apoorva Prasad,
Advs.
versus
M/S. ALMOND INFRABUILD PRIVATE LIMITED & ANR.
.....Judgment Debtors
Through: Mr. Kartik Nayar, Adv. with Mr.
Krish Kalra and Mr. Divyansh Rai, Advs.
+ OMP (ENF.) (COMM.) 10/2022 & EX.APPL.(OS) 2778/2022
DEEPAK TIWARI .....Decree Holder
Through: Mr. Saif Khan, Mr. Swastik
Bisarya, Mr. Achuthan Sreekumar, Mr.
Rohil Bansal and Ms. Apoorva Prasad,
Advs.
versus
ANAND DIVINE DEVELOPERS PVT. LTD & ANR.
.....Judgment Debtors
Through: Mr. Kartik Nayar, Adv. with Mr.
Krish Kalra and Mr. Divyansh Rai, Advs.
+ OMP (ENF.) (COMM.) 149/2021 & CRL.M.A. 1901/2023,
Signature Not Verified
OMP(ENF)(COMM) 148/2021 & conn. matters Page 1 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56
EX.APPL.(OS) 2744/2022, EX.APPL.(OS) 3413/2022,
EX.APPL.(OS) 102/2023
GAGANDEEP SINGH PURI .....Decree Holder
Through: Mr. Saif Khan, Mr. Swastik
Bisarya, Mr. Achuthan Sreekumar, Mr.
Rohil Bansal and Ms. Apoorva Prasad,
Advs.
versus
M/S. ALMOND INFRABUILD PRIVATE LIMITED & ANR.
.....Judgment Debtor
Through: Mr. Kartik Nayar, Adv. with Mr.
Krish Kalra and Mr. Divyansh Rai, Advs.
+ OMP (ENF.) (COMM.) 168/2021 & CRL.M.A. 1899/2023,
EX.APPL.(OS) 2747/2022, EX.APPL.(OS) 3412/2022,
EX.APPL.(OS) 104/2023
PALLIPPURAM RAMAKRISHNAN
LAKSHMINARAYANAN .....Decree Holder
Through: Mr. Saif Khan, Mr. Swastik
Bisarya, Mr. Achuthan Sreekumar, Mr.
Rohil Bansal and Ms. Apoorva Prasad,
Advs.
versus
ANAND DIVINE DEVELOPERS PRIVATE LIMITED &
ANR. .....Judgment Debtors
Through: Mr. Kartik Nayar, Adv. with Mr.
Krish Kalra and Mr. Divyansh Rai, Advs.
+ OMP (ENF.) (COMM.) 172/2021 & CRL.M.A. 1898/2023,
EX.APPL.(OS) 2743/2022, EX.APPL.(OS) 105/2023
MANEESH GOEL .....Decree Holder
Signature Not Verified
OMP(ENF)(COMM) 148/2021 & conn. matters Page 2 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56
Through: Mr. Saif Khan, Mr. Swastik
Bisarya, Mr. Achuthan Sreekumar, Mr.
Rohil Bansal and Ms. Apoorva Prasad,
Advs.
versus
ANAND DIVINE DEVELOPERS PRIVATE LIMITED &
ANR. .....Judgment Debtors
Through: Mr. Kartik Nayar, Adv. with Mr.
Krish Kalra and Mr. Divyansh Rai, Advs.
+ OMP (ENF.) (COMM.) 174/2021 & CRL.M.A. 1897/2023,
EX.APPL.(OS) 2746/2022, EX.APPL.(OS) 103/2023
NAVDEEP SHERGILL .....Decree Holder
Through: Mr. Saif Khan, Mr. Swastik
Bisarya, Mr. Achuthan Sreekumar, Mr. Rohi
Bansal and Ms. Apoorva Prasad, Advs.
versus
ALMONDS INFRABUILD PRIVATE LIMITED & ANR.
.....Judgment Debtor
Through: Mr. Kartik Nayar, Adv. with Mr.
Krish Kalra and Mr. Divyansh Rai, Advs.
+ OMP (ENF.) (COMM.) 9/2022 & EX.APPL.(OS) 2745/2022
ANURAG JAIN .....Decree Holder
Through: Mr. Saif Khan, Mr. Swastik
Bisarya, Mr. Achuthan Sreekumar, Mr.
Rohil Bansal and Ms. Apoorva Prasad,
Advs.
versus
ANAND DIVINE DEVELOPERS PRIVATE LIMITED &
ANR. .....Judgment Debtors
Signature Not Verified
OMP(ENF)(COMM) 148/2021 & conn. matters Page 3 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56
Through: Mr. Kartik Nayar, Adv. with Mr.
Krish Kalra and Mr. Divyansh Rai, Advs.
CORAM:
HON'BLE MR. JUSTICE C. HARI SHANKAR
JUDGMENT
% 02.09.2024
1. The petitioners in each of these execution petitions seek
execution and enforcement of a Settlement Agreement drawn up
amongst the petitioner(s), Respondent 1 and Respondent 2.
Respondent 2, in each of these petitions is M/s. ATS Infrastructure
Ltd1. In OMP (Enf) (Comm) 148/2021, OMP (Enf) (Comm)
149/2021 and OMP (Enf) (Comm) 174/2021, Respondent 1 is M/s
Almond Infrabuild Pvt Ltd2 whereas in OMP(Enf)(COMM) 10/2022,
OMP(Enf)(COMM) 168/2021, OMP(Enf) (COMM) 172/2021 and
OMP(Enf)(COMM) 9/2022, Respondent 1 is Anand Divine
Developers Pvt Ltd3. Almond Infrabuild and Anand Divine
Developers are wholly owned subsidiaries of ATS.
2. In each of these petitions, the disputes between the parties were
referred to mediation by the Delhi High Court Mediation and
Conciliation Centre4, under whose aegis Settlement Agreements were
drawn up, settling the disputes. These petitions seek enforcement of
the said Settlement Agreements.
1
“ATS”, hereinafter
2
“Almond Infrabuild”, hereinafter
3
“Anand Divine Developers”, hereinafter
4
“the Mediation Centre”
Signature Not Verified
OMP(ENF)(COMM) 148/2021 & conn. matters Page 4 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56
3. The terms of the Settlement Agreements are identical. As such,
the issues arising for consideration in these enforcement petitions are
also identical. For the sake of convenience, this judgment makes
reference to the parties in OMP (Enf) (Comm) 148/2021, namely
Anand Gupta and his wife, Anuradha Vinod Gupta as the petitioners,
Almond Infrabuild as Respondent 1 and ATS as Respondent 2.
Facts
4. Before adverting to the Settlement Agreements of which
enforcement is sought, a brief recital of the facts which led up to this
Execution Petition is necessary.
5. In 2014, the respondents launched a Group Housing Residential
Project under the name “ATS Tourmaline”. The project was in the
nature of a guaranteed buyback and subvention scheme. Each investor
who invested in the project are allotted a residential unit. On the
expiry of 33 to 36 months from the date of investment, an investor had
an option to exit the project by selling the residential unit back to
Respondent 1 at a price of ₹ 1,500/- per sq. ft. over and above the
booking price of ₹ 8,000/- per sq. ft. Respondent 1, as the developer,
therefore, agreed to buy back the residential unit at the said terms.
6. The petitioners invested in the project, consequent to which a
Memorandum of Understanding5 was executed among Respondent 1
and the petitioners on 26 March 2014. Clause 8 of the MOU
Signature Not Verified
OMP(ENF)(COMM) 148/2021 & conn. matters Page 5 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56
incorporated the terms of the Buyback and Subvention Scheme and
read thus:
“8. It is hereby agreed by the parties that the Purchaser/Investor,
within a time frame of 33 months from date of booking to 36
months from the date of booking, shall be entitled to call upon the
Owner/Developer in writing, to purchase the aforesaid Apartment
at the Basic Sale Price of ₹ 9,500/- per square feet plus service tax
paid till date by the Purchaser/investor and in such a case the
Owner/Developer shall repurchase the said Apartment within 30
days of expiry of 36 months from the date of booking. The
Purchaser/Investor will execute the necessary documents to
surrender the allotted units in favour of the Owner/Developer upon
receipt of payment. The Purchaser/Investor shall execute such
necessary deeds, documents in favour of Owner/Developer for the
surrender of the said Apartment by the Purchaser/investor to
Owner/Developer and the payment of repurchase price is subject to
applicable tax laws. In case of delay in making the payment of
repurchase price by the Owner/Developer to the
Purchaser/Developer beyond 30 days, the Owner/Developer shall
be liable to pay interest @ 18% per annum for the period of delay
on the total repurchase price payable to the Purchaser/Investor. It is
hereby clarified that till the time the repurchase price is fully paid
by the Owner/Developer to the Purchaser/investor, the
Owner/Developer shall also be liable to pay to the Bank all
installments, Pre possession EMI, interest to the bank directly and
keep the Purchaser/Investor fully indemnified in this regard.”
7. On 15 December 2016, Petitioner 1 wrote to the respondents,
evincing the petitioners’ interest in availing the buyback option under
the MOU. The respondents were therefore requested to confirm the
sale of the unit allotted to the petitioners and make payment to the
petitioners, in terms of the MOU, by March 2017.
8. The respondents, vide reply e-mail dated 16 December 2016,
confirmed that the parties were bound by the terms and conditions of
the MOU.
5
“MOU”, hereinafter
Signature Not Verified
OMP(ENF)(COMM) 148/2021 & conn. matters Page 6 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56
9. This was, however, followed by a communication dated 10
February 2017 from Respondent 1 to Petitioner 1, recommending that
the petitioners take possession of the unit allotted to them. However,
in the alternative, if the petitioners chose to exit the MOU, the letter
requested for further time to the respondents to abide by its terms and
conditions. The letter further required the petitioners to confirm their
Bank loan details, pre EMI amount and loan account number so that
the respondents could facilitate repayment of the EMIs payable to the
Bank till consummation of the transaction.
10. As the extended period by which the respondents were to make
payment to the petitioners in terms of Clause 8 of the MOU was to
expire on 1 April 2018, the petitioners wrote to the respondents on 20
March 2018, seeking to know when the payments would be received
by them. There was no response to this communication.
11. The respondents started defaulting in paying the EMIs to the
Bank. The petitioners addressed several e-mails to the respondents
towards the beginning of January 2019 in that regard. This was
followed by a detailed legal notice dated 1 April 2019 in which it was
specifically alleged that the respondents had defrauded the petitioners,
who had resultantly, become liable to pay interest of ₹ 18 lakhs per
year on the ₹ 1.97 crore loan availed from the Bank, which was never
their liability in the first place. Besides, it was alleged that Respondent
1 also defaulted in its buyback obligations to the petitioners under the
MOU. In these circumstances, the petitioners called upon the
Signature Not Verified
OMP(ENF)(COMM) 148/2021 & conn. matters Page 7 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56
respondents to pay the buyback amount to the petitioners, along with
accrued interest, totalling ₹ 1.36 crores, repay the three defaulted
instalments of ₹ 4.62 lakhs to the Bank and settle the remaining
outstanding loan of ₹ 1.97 crores with the Bank.
12. On the respondents not complying with these requests, the
petitioners approached this Court by means of OMP (I) (Comm)
156/2020 under Section 96 of the Arbitration and Conciliation Act,
19967, as the MOU envisaged resolution of disputes between the
parties by arbitration.
13. The matter was settled between the petitioners and the
respondents, with the intervention of the Mediation Centre, vide
6
9. Interim measures, etc. by Court. –
(1) A party may, before or during arbitral proceedings or at any time after the making of the
arbitral award but before it is enforced in accordance with Section 36, apply to a Court:–
(i) for the appointment of a guardian for a minor or a person of unsound mind for
the purposes of arbitral proceedings; or
(ii) for an interim measure of protection in respect of any of the following matters,
namely:–
(a) the preservation, interim custody or sale of any goods which are the
subject-matter of the arbitration agreement;
(b) securing the amount in dispute in the arbitration;
(c) the detention, preservation or inspection of any property or thing
which is the subject-matter of the dispute in arbitration, or as to which any
question may arise therein and authorising for any of the aforesaid purposes any
person to enter upon any land or building in the possession of any party, or
authorising any samples to be taken or any observation to be made, or
experiment to be tried, which may be necessary or expedient for the purpose of
obtaining full information or evidence;
(d) interim injunction or the appointment of a receiver;
(e) such other interim measure of protection as may appear to the Court
to be just and convenient,
and the Court shall have the same power for making orders as it has for the purpose of,
and in relation to, any proceedings before it.
(2) Where, before the commencement of the arbitral proceedings, a court passes an order for
any interim measure of protection under sub-section (1), the arbitral proceedings shall be
commenced within a period of ninety days from the date of such order or within such further time
as the court may determine.
(3) Once the arbitral tribunal has been constituted, the court shall not entertain an application
under sub-section (1), unless the court finds that circumstances exist which may not render the
remedy provided under Section 17 efficacious.
7
“the 1996 Act”, hereinafter
Signature Not Verified
OMP(ENF)(COMM) 148/2021 & conn. matters Page 8 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56
Settlement Agreement dated 14 October 2020, which read thus :
“Date : 14th October 2020
SETTLEMENT AGREEMENT
This Settlement Agreement is entered into on 14th October 2020
BETWEEN
Mr. Anand Gupta, S/o Late Tarun Gupta, and Mrs. Anuradha
Vinod Gupta, w/o Mr. Anand Gupta, at C-589 Defence Colony,
First Floor, New Delhi, 110024 (jointly referred to as Petitioner)
(hereinafter referred to as a First Party).
AND
M/s Almond Infrabuild Private Limited (CIN No.
U45400DL2010PTC204100) at 711/92, Deepali, Nehru Place,
New Delhi-110019 through its Authorized Representative Ms.
Jyoti Anand (PAN – AHYPA1340E), authorized vide Board
Resolution dated 10th July 2020, copy whereof is annexed herewith
as ANNEXURE- A. (hereinafter referred to as the Second
Party).
AND
M/s ATS Infrastructure Ltd. (CIN No.
U45201DL1996PLC083475) at 711/92, Deepali, Nehru Place,
New Delhi-110019, through its Authorized Representative Ms.
Jyoti Anand (PAN-AHYPA1340E), authorized vide Board
Resolution dated 22nd September 2020, copy whereof is annexed
herewith as ANNEXURE-B (hereinafter referred to as the
Third Party)
WHEREAS the First Party had entered into an agreement with the
Second Party for purchase of an Apartment No. [1232] on the 23rd
floor having super area of approximately 3150 sq. ft. (292.64 sq.
mts.) in Tower/ Building No. 1 in ‘ATS TOURMALINE along
with 2 proposed car parking(s) earmarked in the basement/ Open
area vide Buyers Agreement dated 2 April, 2014.
AND WHEREAS the Second Party also had executed a MOU
dated 26 March 2014 with the First Party. Consequently, disputes
and differences arose between the parties arising out of the MOU
dated 26 March 2014 and the Buyers Agreement dated (2 April
Signature Not Verified
OMP(ENF)(COMM) 148/2021 & conn. matters Page 9 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56
2014) and thereafter the First Party filed an O.M.P. (I) No.
[156)/2020 against the Second Party seeking various measures of
interim relief under Section 9 of the Arbitration & Conciliation
Act, 1996 which is pending before the Hon’ble High Court of
Delhi.
AND WHEREAS during the pendency of the said O.M.P. (I)
(Comm.) No. 156/2020 the parties were referred to Samadhan
(Delhi High Court Mediation and Conciliation Centre) vide an
order dated 07.07.2020 passed by Hon’ble Ms. Justice Rekha Palli
for an attempt towards an amicable settlement
AND WHEREAS the Delhi High Court Mediation and
Conciliation Centre assigned the matter to Mr. Arun Agarwal and
Mr. Vinod Kumar as the Mediator and Co-Mediator respectively to
facilitate a settlement between the parties and the parties hereto
consented to their appointment.
AND WHEREAS comprehensive Mediation Sessions were held
by the Learned Mediator and Learned Co-Mediator with the parties
and/or their respective Counsel on various dates but the parties
could not arrive at an amicable resolution and the matter was
returned to the Hon’ble Delhi High Court as ‘not settled”.
AND WHEREAS thereafter, the matter was again referred to
Samadhan (Delhi High Court Mediation and Conciliation Centre)
vide an order dated 11.08.2020 passed by Hon’ble Ms. Justice
Rekha Palli.
AND WHEREAS the parties agreed that Mr. Sudhanshu Batra,
Senior Advocate and Ms. Nisha Bhambhani, Advocate would act
as their Mediator and Co-Mediator respectively.
AND WHEREAS virtual meetings through Cisco Webex of the
mediation centre were held with the parties on 24.08.2020,
01.09.2020, 17.09.2020, 22.09.2020, 25.09.2020, 01.10.2020 and
the parties have with the assistance of the Learned Mediator and
Co- Mediator, voluntarily arrived at an amicable resolution of all
their disputes and differences. The First Party was accompanied by
its counsel, Mr. Nishant Kumar, Advocate (Enrl. No. D/2061/2017)
(email: [email protected]), the Second Party was accompanied
by its counsel, Mr. Kartik Nayar, Advocate (Enrl. No. D/513/2007)
(email: [email protected]) and Mr. Sarthak Malhotra, Advocate
(Enrl. No. D/6588/2017) (email: [email protected]), and the
Third Party was accompanied by its counsel Mr. Kartik Nayar,
Advocate (Enrl. No. D/513/2007) (email: [email protected]) and
Mr. Sarthak Malhotra, Advocate (Enrl. No. D/6588/2017)
Signature Not Verified
OMP(ENF)(COMM) 148/2021 & conn. matters Page 10 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56
(email: [email protected]). The parties, with the assistance of the
Mediator and proactive participation of the counsels have
voluntarily arrived at an amicable solution resolving the
abovementioned disputes and differences.
AND WHEREAS although the Second Party disputes the case of
the First Party and denies the Buy Back Agreement on various
grounds but the Parties herein have decided to settle their dispute
amicably and mutually but without getting into the merits of the
matter, the parties have entered into this settlement agreement.
1. The First Party hereby authorizes the Second Party to act on
their behalf and sell the Apartment No. [1232] on the 23rd floor
having super area of approximately [3150] sq. ft. ([292.64] sq.
mts.) in Tower/ No. [1] along with [2] proposed car parking(s)
earmarked in the basement/ Open area (“Apartment”) in respect of
which the parties had executed a Buyers Agreement dated [2 April
2014) and an MOU dated [26 March 2014) as well as a Tripartite
Agreement dated (2 April 2014] with [ICICI] Bank for loan
account number [LBNOD00002088057], on an ‘as is where as
basis’. It is agreed between the First Party and Second Party that
the Second Party shall be fully authorized to sell the said
Apartment subject to the NO OBJECTION from the (ICICI) Bank,
on such terms and conditions as maybe considered fit by the
Second Party and the Second Party shall be entitled to appropriate
the entire sale proceeds from the sale of the said Apartment. It is
agreed between the parties hereto that the First Party shall
authorize the Second Party, who shall be responsible to get the ‘NO
OBJECTION’ from the (ICICI) Bank, for sale of the said
apartment. Failure to obtain the ‘NO OBJECTION’ for any reason
whatsoever shall not absolve the Second and Third Parties of their
obligations contained in this settlement agreement.
2. In consideration of the above, the Second Party agrees and
undertakes to pay to the First Party on or before the 14th July 2021,
the principal amount invested by the First Party i.e. an amount of
Rs. [52,34,581]/- (Rupees [Fifty Two Lakhs, Thirty Four
Thousand, Five Hundred Eighty One] Only) and a further amount
of [33,62,248) (Rupees [Thirty Three Lakhs, Sixty Two Thousand,
Two Hundred Forty Eight) Only) which is equivalent to the entire
EMIs paid directly by the First Party to [ICICI] Bank and such
further amount being 50% of monthly EMIs that will be paid by
virtue of this agreement and in terms of the Loan Account No.
[LBNOD00002088057) and more particularly set out in
Annexure-C(hereafter referred to as the ‘Settled amount’). The said
Settled amount shall be paid by the Second Party to the First Party
Signature Not Verified
OMP(ENF)(COMM) 148/2021 & conn. matters Page 11 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56
irrespective of the sale of the Apartment as envisaged in Clause 1
for whatever reason. It is further agreed that the said payment of
the Settled amount may be made or caused to be paid by the
Second Party or any other person/ entity on behalf of the Second
Party either in a single installment or in multiple tranches so as to
pay the entire amount agreed upon herein on or before the 14th July
2021
3. It is further agreed that the Second Party shall continue to pay
50% of all future monthly EMIs to ICICI Bank under Loan
Account No. LBNOD00002088057 by way of direct bank transfer
to the First Party three days before the stipulated dates of payment
of the EMI under the Loan Agreement till such time that the entire
amount due to the Bank under Loan Account No.
(LBNOD00002088057] is not completely discharged/paid by the
Second Party either through itself or any other person/entity. It is
agreed by the Parties that the remaining 50% of all future EMIs to
(ICICI) Bank under Loan Account No. LBNOD00002088057,
shall continue to be borne by the First Party which shall be
reimbursed to the First Party by the Second Party by including it in
the Settled amount, in terms of Clause 2 above.
4. In addition to the aforesaid payments, which are required to be
paid by the Second Party to the First Party on or before the 14th of
July 2021, the Second Party agrees and undertakes to make the
entire payment to [ICICI] Bank under Loan Account No.
[LBNOD00002088057] on or before the 14th July 2021irrespective
of the sale of the Apartment as envisaged in Clause 1including but
not limited to any accrued interest, charges and accumulated EMIs
(and EMI interest owing to the moratorium) as on the date of
execution of the Settlement Agreement. It is further agreed that the
said payment to the Bank may be made or caused to be paid by the
Second Party or any other person/entity on behalf of the Second
Party either in a single installment or in multiple tranches. In case
of failure of the Second Party to clear the entire outstanding loan
amount of the First party as stipulated herein, the Second Party and
Third Party jointly and severally agree and undertake to indemnify
and keep harmless the First party from any claim raised or action
taken by the (ICICI) Bank against the First Party absolutely and
forever.
5. The Parties hereto agree that in terms of Clause 2 and 3 in case
the Second Party fails, neglects or otherwise refuses to pay the
agreed Settled amount and clear the Bank loan no
[LBNOD00002088057] from [ICICI] Bank in the manner and
within the time envisaged in this settlement agreement, the Second
and Third Parties shall be jointly and severally liable to pay the
Signature Not Verified
OMP(ENF)(COMM) 148/2021 & conn. matters Page 12 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56
‘Settled amount’ plus the entire loan amount paid and payable by
the First party to the ICICI Bank along with simple interest @18%
per annum on the unpaid Settled amount (as on 15th July 2021)
from the date of expiry of three years from the date of execution of
the Buyer’s Agreement till the date of actual payment. In such
eventuality, the First Party shall be entitled to enforce such
payment through execution of the order of court passed in terms of
this Settlement Agreement in accordance with law in addition to
any other remedy available to him.
6. Notwithstanding anything contained in this Agreement, the First
Party shall at its sole discretion, have a right to retain the aforesaid
Apartment No. [1232] and claim possession thereof by issuing a
notice to the Second Party before the expiry of the period of ten
months from the date of this Agreement. In the event the First
Party exercises this right under the foregoing provision, the present
Settlement Agreement shall stand extinguished and the Parties
shall be bound by the Buyers Agreement dated (2 April 2014)
7. In view of this Settlement Agreement, the First Party further
agrees to withdraw all other proceedings (if applicable) initiated
against the Second Party in any other forum within 7 days from the
date of this Agreement.
8. The Third Party being the flagship company of the ATS
group hereby agrees and undertakes that in case of failure of the
Second Party to pay the settled amount and clear the Bank Loan no
[LBNOD00002088057] from [ICICI] Bank in terms hereof, the
Third Party shall be jointly and/or severally liable to pay the
amounts payable by the Second Party and shall be liable for all
consequences arising therefrom.
9. Any and all amounts payable by the Second Party or Third
Party, as the case may be to the First Party under this Agreement
shall be paid to the First Party’s bank account set out in Annexure-
C.
10 The First Party agrees to file an appropriate application before
the Hon’ble High Court in O.M.P.(I) No. 156/2020 seeking
impleadment of ATS infrastructure Limited as a party to the said
proceeding before the next date of hearing so as to bind itself to the
terms of this settlement.
11. The Second Party agrees to file an appropriate application
before the Hon’ble Delhi High Court in O.M.P.(I) No. 156/2020
seeking early listing thereof within 7 days from the date of
execution of this Agreement.
Signature Not Verified
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Date:04.09.2024 22:59 22:56
12. In the event of non-compliance of this Agreement, the
defaulting party shall also be deemed to be in a default akin to a
default of an undertaking given to a court and the non-defaulting
party shall be entitled to pursue appropriate remedies in accordance
with law including but not limited to initiating contempt of court
proceeding against all the signatories and Directors of the
defaulting Parties.
13. The Parties agree that they shall not disclose the existence of
this Agreement or the terms and conditions contained herein and
shall keep the same confidential Notwithstanding the foregoing, the
information shall not be subject to this confidentiality obligation if
it (a) is already known to the receiving party at the time it is
obtained; (b) is or becomes publicly known or available through no
wrongful act of the receiving party, (c) is requested or required to
be disclosed by the receiving party pursuant to a court order or
governmental agency request or law, (d) is relevant to the defense
of any claim or cause of action asserted against the receiving party,
or (e) is necessary or desirable for the parties to release such
information for compliance with this Agreement. The provisions of
this Clause shall survive termination of this Agreement.
14. The present Agreement shall be deemed to have come into
effect from 15 September 2020.
15. In terms of the aforesaid arrangement and upon fulfilling all
obligation by the respective parties hereto, any and all obligations
of each of the Parties in respect of the MOU dated [26 March
2014] and Buyers Agreement dated (2 April 2014) shall stand
completed and discharged and this Settlement Agreement shall
constitute a full and final settlement of the Parties claims under
these agreements
16. By signing this Agreement and upon fulfilment of the parties’
obligations as specified herein, the parties hereto agree that they
shall be left with no further claims or demands against each other
and all the disputes and differences in this regard shall be deemed
to have been amicably settled by the Parties hereto through the
process of Mediation
17. That the parties undertake before the Hon’ble Court to abide by
the terms and conditions set out in this agreement and not to
dispute the same hereinafter in future.
18. This agreement has been arrived at between the parties
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voluntarily and without any force, fraud or undue influence from
any quarters
19. The parties agree that they shall appear before the Hon’ble
court during the virtual hearing to make their statements in terms of
the present settlement agreement…”
14. Following the execution of the above Settlement Agreement,
this Court disposed of OMP (I) (Comm) 156/2020 by the following
order passed on 18 November 2020:
“I.A. 10628/2020
2. This is an application filed by the petitioner under Order-1
Rule 10 read with Section 151 of the Code of Civil Procedure,
1908. Vide the present application, the petitioner is primarily
seeking disposal of the petition in terms of the Settlement
Agreement dated 14.10.2020 arrived at between the parties before
the Delhi High Court Mediation and Conciliation Centre.
However, since, M/s ATS Infrastructure Limited is a party to the
aforesaid settlement, the petitioner is also seeking its impleadment
as respondent no. 4 in the present petition.
3. Issue notice. Mr. Sarthak Malhotra, Advocate accepts
notice and does not oppose the application.
4. Having perused the contents of the settlement agreement, I
am inclined to accept the application and the same is, accordingly,
allowed. Consequently, M/s ATS Infrastructure Limited is
impleaded as respondent no. 4. Amended memo of parties, if not
already filed, be filed within three days.
5. The application is disposed of.
O.M.P. (I) (COMM.) 156/2020
6. Mr. Sarthak Malhotra, Advocate enters appearance on
behalf of the newly added respondent no. 4.
7. In view of the application being allowed and the Settlement
Agreement being taken on record, the petition is disposed of in
terms of the settlement dated 14.10.2020, which will now form
part of the record. Needless to say, the parties will remain bound
by the terms of the said settlement.
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8. The petition is disposed of in the aforesaid terms and the
next date of hearing stands cancelled.”
15. The present petition seeks execution and enforcement of this
settlement agreement. Mr. Khan, learned Counsel for the petitioners,
presses only prayers a) to c) in the petition. As such, it is necessary to
extract the said prayers:
“45. In the light of the foregoing, it is most respectfully prayed
that this Hon’ble Court may be pleased to pass the following
orders:
a) An order issuing notice to the Judgement Debtors,
its Director and authorised signatory whilst directing them
to comply with the consent order dated 18 November 2020,
passed by this Hon’ble Court in OMP (I) (Comm)
156/2020 by immediately complying with the terms of the
Settlement Agreement dated 14 October 2020 forming part
of the consent order dated 18 November 2020, thereby
paying the Decree Holder is the Settlement Amount along
with interest at the rate of 18% per annum as stipulated
under Clause 2 read with Clause 3 and Clause 5 of the said
Settlement Agreement and also by immediately clearing off
the remaining loan amount with the ICICI Bank against the
Loan Account No. LBNOD00002088057 as undertaken in
Clause 4 of the settlement agreement; and
b) An order directing the Judgement Debtors to pay
100% of the EMI amounts owed to the banks and remove
the current burden on the Degree Holders of paying the
50% EMI amount, till such time when the entire loan
amount with the ICICI Bank against the Loan Account No.
LBNOD00002088057 is paid off by the Judgement
Debtors; and
c) Pass an order attaching the assets of the Judgement
Debtors and direct them to deposit the decree will amount
(sum total of the Settlement Amount interest along with the
total amount to clear off the above-mentioned ICICI Bank
Loan) in accordance with the Settlement Agreement dated
14th October, 2020 before this Hon’ble Court.”
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Orders passed by this Court in the present proceedings
16. The following orders came to be passed by this Court in the
present petition:
(i) While issuing notice on 20 September 2021, the
respondents were directed to file the affidavits of their assets
and were also restrained from alienating their assets/properties
to the extent of the amount payable to the petitioners as per the
Settlement Agreement.
(ii) On 23 March 2022, the respondents submitted that they
needed time to pay the decretal amount and that they were
paying the EMIs to the Bank. They also undertook to “take
over the payment of all EMIs being paid by or to be paid by the
Decree Holders, with effect from the next EMI”. The
undertaking was accepted, and an affidavit to that effect was
directed to be filed. The Court went on to grant the parties three
days’ time “to work out the schedule of payment and other
modalities whereby the decree will be satisfied without any
further financial obligation or pressure upon the Decree
Holders”, and directed that the amount already paid by the
petitioners would be repaid to them by the respondents.
(iii) On 10 May 2022, the following order was passed:
“1. Learned senior counsel for the judgment debtor
prays for some time to submit a proposal to pay the entire
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decreed amount. He submits that for the said purpose
certain documentation would be required to be executed by
the decree holders.
2. Learned counsel for the decree holders submits that
they have no objection to the execution of the documents
provided there is no further liability or obligation on their
part either towards the proposed third party purchasers or
towards the bank and they are paid their amount as per the
agreed timelines.”
(iv) On 9 September 2022, learned Counsel for the
respondents stated that the respondents would make the EMI
payments to the Bank as per the stipulated date in the
Settlement Agreement.
(v) On 11 April 2023, further submissions and undertakings
were given by the respondents, which were recorded thus:
“2. Mr. Nayar submitted that in order to lay all
controversies at rest, the respondents are ready and willing
to negotiate and enter into arrangements with the banks and
financial institutions which have extended loans and other
financial facilities to the petitioners in this batch and to take
over the entire liability in terms of the Settlement and the
Award. It was his submission that once such arrangements
are entered into with the individual financial institutions,
the respondents shall call upon the petitioners to either
enter into an Agreement to Sell with third parties identified
by the respondents or to execute a “Surrender” document
enabling them to take further steps for disposal of the
immovable properties in question. It was submitted that till
such time as the liabilities owed by the petitioners to the
financial institutions is cleared and the transfer or sale of
the immovable properties are finally affected, the
respondents would tender security in the shape of title
deeds of unencumbered immovable properties which would
cover the entire liability that are owed to all the petitioners
in this batch.
3. In order to evaluate the merits of the offer that is made it
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would appear expedient for the respondents being called
upon to place the same on the record of these proceedings
by way of an affidavit of a responsible officer of the
company duly authorized in this regard. Let the said
affidavit be filed within a period of two weeks from today.
The affidavit be filed in OMP(ENF.)(COMM.)148/2021
and copies thereof be circulated amongst learned counsels
appearing for the petitioners in this batch.
4. The respondents shall, in any case, be liable to abide by
the terms of the agreement and the assurance recorded
earlier that they would continue to service all EMIs’
payable by the petitioners in the meanwhile”
(vi) On 27 February 2024, the following order was passed:
3. Mr. Nayar, learned counsel for the judgment-debtors
assures that the monthly EMIs shall be paid within one
week from today.
4. Mr. Nayar further states that the judgment-debtors are
ready and willing to sell the flats of the decree-holders.
5. Mr. Khan, learned counsel for the decree-holders states
that he is ready to sign the Agreement to Sell provided that
the judgment-debtors will indemnify for any liability that
may arise out of the Agreement to Sell. The decree-holders
are agreeable to have an agreement with ATS Infrastructure
Private Limited provided they also make a submission that
they will pay the interest as per the Samadhan Agreement.
Thereafter, on 10 July 2024, arguments were heard in these petitions
and orders reserved.
Rival Contentions and Analysis
17. In their reply to the petitioners’ application under Order XXI
Rule 41 of the CPC, as well as in their written submissions tendered
after orders were reserved in these matters, the respondents have
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raised issues of maintainability as well as merits. Though arguments
in Court were restricted to the merits of the petition, I proceed to deal
with both aspects.
18. Re. Submission that order dated 18 November 2020 is neither
an “award” nor a “decree” and cannot, therefore, be executed under
Section 368 of the 1996 Act
18.1 The respondents contend that the order dated 18 November
2020, of which execution/enforcement is sought, is neither an award
nor a decree and cannot, therefore, be executed.
18.2 The present Execution Petitions have not been filed under
Section 36 of the 1996 Act, but have been filed under Order XXI Rule
109 read with Section 15110 of the CPC. The petitioners do not seek to
invoke Section 36 of the 1996 Act.
8
36. Enforcement-
(1) Where the time for making an application to set aside the arbitral award under Section 34
has expired, then, subject to the provisions of sub-section (2), such award shall be enforced in
accordance with the provisions of the Code of Civil Procedure, 1908 (5 of 1908), in the same
manner as if it were a decree of the court.
(2) Where an application to set aside the arbitral award has been filed in the court under
Section 34, the filing of such an application shall not by itself render that award unenforceable,
unless the court grants an order of stay of the operation of the said arbitral award in accordance with
the provisions of sub-section (3), on a separate application made for that purpose.
(3) Upon filing of an application under sub-section (2) for stay of the operation of the arbitral
award, the court may, subject to such conditions as it may deem fit, grant stay of the operation of
such award for reasons to be recorded in writing:
Provided that the court shall, while considering the application for grant of stay in the case of an
arbitral award for payment of money, have due regard to the provisions for grant of stay of a money
decree under the provisions of the Code of Civil Procedure, 1908 (5 of 1908)
9
10. Application for execution – Where the holder of a decree desires to execute it, he shall apply to the
Court which passed the decree or to the officer (if any) appointed in this behalf, or if the decree has been sent
under the provisions hereinbefore contained to another Court then to such Court or to the proper office
thereof.
10
151. Saving of inherent powers of Court – Nothing in this Code shall be deemed to limit or otherwise
affect the inherent power of the Court to make such orders as may be necessary for the ends of justice or to
prevent abuse of the process of the Court.
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AN HARI SHANKAR
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Date:04.09.2024 22:59 22:56
18.3 Insofar as the enforceability of the order dated 18 November
2020, passed by this Court in OMP (I) (Comm) 156/2020 is
concerned, the issue stands covered against the respondents by the
judgment of the Division Bench of this Court, authored by Gita Mittal
J (as she then was) in Angle Infrastructure Pvt Ltd v Ashok
Manchanda11. The decision clearly holds that an order passed in a
petition under Section 9 of the 1996 Act, based on a settlement arrived
at in mediation is a “decree” and is, therefore, capable of being
executed under the CPC.
18.4 In Angle Infrastructure, disputes having arisen between Angle
Infrastructure12 and Ashok Manchanda13, and as the contract between
them contained an arbitration clause, Ashok filed a petition against
Angle under Section 9 of the 1996 Act, seeking pre-arbitral interim
reliefs. The parties were referred to the Delhi High Court Mediation
and Conciliation Centre, to attempt resolution of their disputes by
mediation, by order dated 8 May 2013 passed by this Court. In
mediation, the parties arrived at a settlement, and a Settlement
Agreement dated 30 October 2013 was drawn up. Consequent
thereon, the Section 9 petition filed by Ashok was disposed of, by a
learned Single Judge of this Court, by the following order passed on 6
November 2013:
“I have perused the terms of the settlement. The same are lawful.
As prayed, the petitions are disposed of in terms of the Settlement
Agreement dated 30.10.2013. Parties shall abide by the terms of11
228 (2016) DLT 624 (DB)
12
“Angle” hereinafter
13
“Ashok” hereinafter
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the settlement. Accordingly, a decree is passed in terms of the
settlement agreement.
The petitions are, accordingly, disposed of.”
18.5 Ashok filed Execution Petition 405/2014 for execution of the
Settlement Agreement. A learned Single Judge of this Court held, on
14 November 2014, that the settlement had morphed into an arbitral
award on the terms agreed in the Settlement Agreement. It was,
therefore, required to be treated as an arbitral award, which could
straightaway be executed by the concerned court in Gurgaon, as the
immovable property against which execution was sought was located
in Gurgaon. The learned Single Judge, therefore, disposed of the
Execution Petition, reserving liberty with Ashok to execute the
Settlement Agreement as an arbitral award before the Gurgaon Court.
18.6 Angle challenged the order dated 14 October 2014 of the
learned Single Judge by way of appeal to the Division Bench of this
Court.
18.7 In an intricately reasoned judgment, the Division Bench first
examined whether the Settlement Agreement dated 30 October 2013
was the outcome of mediation or of conciliation. This, it was noted,
was relevant as Section 7414 of the 1996 Act accorded, to a
conciliation agreement, the “same status and effect as if it is an
arbitral award”, while not according any such status to a Settlement
Agreement which was the outcome of mediation. Section 36 of the
14
74. Status and effect of settlement agreement. -The settlement agreement shall have the same status and
effect as if it is an arbitral award on agreed terms on the substance of the dispute rendered by an arbitral
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1996 Act envisaged enforcement of an arbitral award “in the same
manner as if it were a decree”. Thus, enforcement of a Settlement
Agreement emerging from conciliation would, therefore, have to be
under Section 36 of the 1996 Act, treating the Settlement Agreement
as an arbitral award, which, therefore, became enforceable like a
decree. Para 38 of the report in Angle Infrastructure, which so holds,
read thus:
“38. Therefore, enforcement of such settlement would have to
be effected in accordance with Section 36 under Chapter-VIII of
the Arbitration and Conciliation Act, 1996. Section 36 specifically
dealing with enforcement, stipulates that an arbitral award shall be
enforced “under the Code of Civil Procedure, 1908 (5 of 1908) in
the same manner as if it were a decree”. Therefore, such
conciliation, that commences by voluntary acts as provided under
Part-III of the Arbitration and Conciliation Act, 1996 does not
envisage intervention of the court other than for the purposes of
enforcement thereof which has to be by the civil court as it were a
decree of the court. A settlement in the conciliation, therefore,
would not result in a decree.”
(Emphasis in original)
Reliance was also placed, in this context, on Section 8915 of the CPC,
which empowered the Court to refer parties, under sub- section (2), to
tribunal under section 30.
15
“89. Settlement of disputes outside the Court.–
(1) Where it appears to the court that there exist elements of a settlement which may be
acceptable to the parties, the Court shall formulate the terms of settlement and give them to the
parties for their observations and after receiving the observations of the parties, the court may
reformulate the terms of a possible settlement and refer the same for–
(a) arbitration;
(b) conciliation;
(c) judicial settlement including settlement through Lok Adalat; or
(d) mediation.
(2) Where a dispute has been referred--
(a) for arbitration or conciliation, the provisions of the Arbitration and Conciliation
Act, 1996 (26 of 1996) shall apply as if the proceedings for arbitration or conciliation
were referred for settlement under the provisions of that Act;
(b) to Lok Adalat, the Court shall refer the same to the Lok Adalat in accordance
with the provisions of sub-section (1) of Section 20 of the Legal Services Authority Act,
1987 (39 of 1987) and all other provisions of that Act shall apply in respect of the dispute
so referred to the Lok Adalat;
(c) for judicial settlement, the Court shall refer the same to a suitable institution or
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arbitration, conciliation, Lok Adalat settlement, judicial settlement or
mediation. If the dispute was referred to conciliation, Section 89(2a)
specifically mandated that the provisions of the 1996 Act would
apply, as if the dispute had been referred for settlement under it. The
Division Bench encapsulated this legal position thus, in para 48 of the
report:
“48. From the above, it is apparent that conciliation as a dispute
redressal mechanism can be initiated voluntarily by the parties in
accordance with Part-III of the Arbitration and Conciliation Act,
1996. Even in a case before the court, the parties, with their
consent, can be referred to conciliation under Section 89 of the
CPC. Such reference would be dealt with in accordance with
Section 6416 of Arbitration Act. The settlement, if any, shall be
governed by Section 74 of the Arbitration and Conciliation Act and
would require to be enforced in the manner of an arbitral award.”
18.8 As against this, on a settlement being arrived at in mediation,
Section 89(2)(d) of the CPC applied, and the Court was required to
person and such institution or person shall be deemed to be a Lok Adalat and all the
provisions of the Legal Services Authority Act, 1987 (39 of 1987) shall apply as if the
dispute were referred to a Lok Adalat under the provisions of that Act;
(d) for mediation, the Court shall effect a compromise between the parties and shall
follow such procedure as may be prescribed.”
16
64. Appointment of conciliators.–
(1) Subject to sub-section (2)--
(a) in conciliation proceedings, with one conciliator, the parties may agree on the
name of a sole conciliator;
(b) in conciliation proceedings with two conciliators, each party may appoint one
conciliator;
(c) in conciliation proceedings with three conciliators, each party may appoint one
conciliator and the parties may agree on the name of the third conciliator who shall act as
the presiding conciliator.
(2) Parties may enlist the assistance of a suitable institution or person in connection with the
appointment of conciliators, and in particular,–
(a) a party may request such an institution or person to recommend the names of
suitable individuals to act as conciliator; or
(b) the parties may agree that the appointment of one or more conciliators be made
directly by such an institution or person:
Provided that in recommending or appointing individuals to act as conciliator, the institution or
person shall have regard to such considerations as are likely to secure the appointment of an
independent and impartial conciliator and, with respect to a sole or third conciliator, shall take into
account the advisability of appointing a conciliator of a nationality other than the nationalities of the
parties.
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effect a compromise between the parties and follow such procedure as
may be prescribed. These procedures, it was noted, in para 49 of the
report, were contained in the Delhi High Court Mediation and
Conciliation Rules, 2004.
18.9 The Division Bench went on to examine the position which
obtained in the Section 9 petition filed by Ashok against Angle. It
was observed, in para 50 of the report, that the dispute was not
referred to conciliation following the procedure envisaged in that
regard in Part III of the 1996 Act, but was referred specifically to
mediation by the Mediation Centre. The settlement that resulted was,
therefore, the outcome of mediation, not of conciliation. In that view
of the matter, the Division Bench found the learned Single Judge to
have been in error in holding that the Settlement Agreement had
morphed into an arbitral award and that, therefore, it was directly
executable as an arbitral award under Section 74 of the 1996 Act.
These findings clearly apply, on all fours and mutatis mutandis, to the
present case.
18.10 Having thus held that the Settlement Agreement had not
morphed into an arbitral award, as held by the learned Single Judge,
the Division Bench went on to examine whether the settlement
agreement, or the consequent order passed by the Court disposing of
the Section 9 petition, was a “decree”, executable under the CPC.
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18.11 A Section 9 petition, it was held, was disposed of by an “order”,
and not a “decree”. Section 2(14)17 of the CPC clearly excluded, from
the ambit of the definition of “decree”, “orders”. Even if, therefore,
are Section 9 petition were to be allowed, the Court doing so could
neither pass a decree not direct a decree to be drawn up. It was so
held in para 63 of the report:
“63. It is therefore, well settled that even if a petition under
Section 9 of the Arbitration Act was to be allowed, no decree could
be passed nor a decree sheet could be ordered to be drawn up.
Proceedings under Section 9 of the Arbitration Act culminating in
a Settlement Agreement between the parties result in the passing of
an order in terms thereof.”
Thus, the Division Bench found the direction, contained in the order
dated 6 November 2013 passed by the learned Single Judge, under
challenge before it, to draw up a decree in terms of the order, to be an
unnecessary surplusage and contrary to law, as an order disposing of
Section 9 petition on the basis of a mediated settlement cannot result
in a decree.
18.12 The present respondents rely only on the above enunciation, in
Angle Infrastructure, that a Settlement Agreement executed
consequent on mediation by the Mediation Centre is neither an award
nor a decree. The respondents, however, conveniently omit to refer to
the fact that, having so observed, the Division Bench in Angle
Infrastructure goes on to hold that the order disposing of the Section
9 petition on the basis of the Settlement Agreement is nonetheless
17
2. Definitions.–In this Act, unless there is anything repugnant in the subject or context,–
*****
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enforceable under the CPC, just as a decree would be enforceable, in
view of Section 3618 of the CPC, which equates orders with decrees.
Para-83 of the report in Angle Infrastructure specifically so holds:
“”83. Such an order (passed in terms of the settlement
agreement) would be executable under Section 36 of the Code of
Civil Procedure in the same manner as a decree.”
(Emphasis supplied)
18.13 Thus, though the order dated 18 November 2020, passed by
this Court disposing of OMP (I) (Comm) 156/2020 is neither an
award nor a decree, it is capable of being executed in the same manner
as a decree is executed, in view of Section 36 of the CPC, as held in
para 83 of the judgment of the Division Bench in Angle
Infrastructure.
18.14 The respondents’ objection that, as the order dated 18
November 2020 is neither an award nor a decree, it is not capable of
execution under the CPC is, therefore, rejected.
18.15 I may observe, here, that, though some of the provisions of the
1996 Act dealing with mediation stand deleted with the enactment of
the Mediation Act, 2023, those deletions would not apply here, as the
Settlement Agreement was executed prior to the coming into force of
the Mediation Act. Even otherwise, the ratio decidendi of Angle
Infrastructure would squarely apply to the present case.
(14) “order” means the formal expression of any decision of a Civil Court which is not a decree
18
36. Application to orders.–The provisions of this Code relating to the execution of decrees (including
provisions relating to payment under a decree) shall, so far as they are applicable, be deemed to apply to the
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19. Re. submission that, as the respondent’s assets are located
outside Delhi, this Court lacks the territorial jurisdiction to deal with
the present Execution Petitions
19.1 The respondents next contend that the present execution
petition is not maintainable before this Court, as the assets of the
respondents are situated outside its jurisdiction.
19.2 Ironically, however, the passage, from the judgment of the
Supreme Court in Sundram Finance v Abdul Samad19, on which the
respondents rely, itself defeats their contention. The passage reads
thus:
“19. The Madras High Court in Kotak Mahindra Bank
Ltd. v. Sivakama Sundari20, referred to Section 46 of the said
Code, which spoke of precepts but stopped at that. In the context of
the Code, thus, the view adopted is that the decree of a civil court
is liable to be executed primarily by the court, which passes the
decree where an execution application has to be filed at the first
instance. An award under Section 36 of the said Act, is equated to
a decree of the court for the purposes of execution and only for that
purpose. Thus, it was rightly observed that while an award passed
by the Arbitral Tribunal is deemed to be a decree under Section 36
of the said Act, there was no deeming fiction anywhere to hold that
the court within whose jurisdiction the arbitral award was passed
should be taken to be the court, which passed the decree. The said
Act actually transcends all territorial barriers.”
The Supreme Court, in the above passage from Sundram Finance,
has distinguished between a decree and an arbitral award, insofar as
the Court which can be approached for execution is concerned.
Section 36 of the 1996 Act equates an arbitral award with a decree of
execution of orders (including payment under an order).
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a court only for the purposes of its executability. Section 36 only says
that the award is executable as a decree of a Court. This is in
contradistinction to the position which obtained under the erstwhile
Arbitration Act, 1940, under which an arbitral award was not per se
executable, unless it was made rule of the Court on moving a specific
application for the purpose. As against this, under the 1996 Act, by
virtue of Section 36, the arbitral award is ipso facto executable as a
decree of the Court. The Supreme Court clarified, however, that the
entitlement to execution of an arbitral award as a decree of a Court
cannot be extended to the award being treated as a decree of the Court
within whose territorial jurisdiction the award was rendered. This is
in keeping with the well tested principle that a deeming fiction cannot
extend beyond the frontiers to which it is intended. Thus, an arbitral
award passed within the territorial jurisdiction of this Court is
executable as a decree, but it does not transmogrify into a decree of
this Court. The appropriate Court, which would have to be moved for
execution of the award would, therefore, have to be determined on the
basis of the situs of the properties against which the execution is
directed, and not the Court within whose territorial jurisdiction the
award is rendered.
19.3 This principle, however, has no application to the present case,
as the order dated 18 November 2020 of this Court, of which the
petitioners seek execution, is not an award, as Angle Infrastructure
clarifies, but an order. The principles applicable to execution of an
arbitral award, contained in para 18 of Sundram Finance do not,
therefore, apply.
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19.4 What applies is, rather, the preceding observation in the same
paragraph of Sundaram Finance, that it is “liable to be executed
primarily by the Court, which passes the decree where an execution
application has to be filed at the first instance”. Section 36 of the
CPC equates the order dated 18 November 2020 with a decree under
the CPC. Ergo, insofar as the aspect of execution is concerned (as held
in Angle Infrastructure), the execution petition has to be filed before
this Court, as the Court which has passed the order of which execution
was sought. In the event that, for execution, the properties of the
respondents are situated outside the territorial jurisdiction of this
Court have to be attached, the Court would have to issue the necessary
precepts to the Court(s) within whose jurisdiction the properties are
situate. That is all.
19.5 The execution petitions are, however, clearly maintainable
before this Court, and the objection to the contrary, raised by the
respondents is, therefore, also rejected.
20. Relief, if any, to which the petitioners are entitled
20.1 As already noticed in para 15 supra, Mr. Khan presses only
prayers a) to c) in each of these petitions. Prayer a) seeks a direction
to the respondents to make payment to the petitioners in terms of
Clauses 2, 3 and 5 of the Settlement Agreement and to clear off the
remaining loan amount with the ICICI Bank as per Clause 4 of the
Settlement Agreement. This prayer, in fact, subsumes prayers b) and
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c), inasmuch as prayer b) seeks a direction to the respondents to pay
the entire EMI amounts owed to the banks and prayer c) seeks a
direction to attach the assets of the respondents and direct them to
deposit the total of the settlement amount with interest and the amount
required to be paid for clearing of the ICICI Bank loan, in accordance
with the Settlement Agreement.
20.2 In view of my decision that the present Execution Petition lies,
and is maintainable before this Court, it is obvious that both sides
have to comply with the terms of the Settlement Agreement. All that
is to be seen, therefore, is what the Settlement Agreement requires.
20.3 It is not necessary to refer to the rival contentions in this regard,
is one may directly advert to the Settlement Agreement itself, to
understand its contents.
20.4 To my mind, the covenants of the Settlement Agreement are
fairly clear, and do not admit of any complexity. The rival rights and
obligations, as encapsulated in the Settlement Agreement, may be
enumerated as under:
(i) Vide Clause 1, the petitioners authorised Respondent 1 to
act on the petitioner’s behalf and sell Apartment 123221 along
with two proposed earmarked car parkings, subject to NOC
from the ICICI Bank. The responsibility of obtaining NOC
from the ICICI bank was of Respondent 1. The terms andSignature Not Verified
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conditions of sale were to be determined by Respondent 1.
Respondent 1 was entitled to appropriate the entire sale
proceeds.
(ii) Clause 1 further stipulated that the respondents would
not be absolved of their obligations under the Settlement
Agreement even if they failed to obtain an NOC from the ICICI
Bank.
(iii) “In consideration of the above”, Clause 2 obligated
Respondent 1 to pay, to the petitioners, on or before 14 July
2021,
(a) ₹ 52,34,581/-, being the principal amount invested
by the petitioner,
(b) ₹ 33,62,248/-, equivalent to the EMIs directly paid
by the petitioners to the ICICI Bank and
(c) 50% of the monthly EMIs is payable to the Bank
as per the Settlement Agreement in respect of Loan
Account No LBNOD00002088057, as set out in
Annexure C to the Settlement Agreement.
(iv) Clause 2 further clarified that the liability of
Respondent 1 to make the above payment to the petitioners
was “irrespective of the sale of the Apartment as envisaged in
Clause 1 for whatever reason”.
21
“the Apartment”, hereinafter
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(v) Clause 3 obligated Respondent 1 to continue to pay 50%
of all future monthly EMIs to the Bank by direct transfer to the
petitioners, 3 days prior to the stipulated date of payment of the
EMI, till complete discharge of the entire amount due to the
Bank by Respondent 1.
(vi) While the petitioners undertook to pay the remaining
50% of future EMIs to the Bank, Clause 3 obligated
Respondent 1 to reimburse the said payment to the petitioners
by including it in the Settled amount as per Clause 2.
(vii) Clause 4 further obligated Respondent 1 to make
payment of the entire loan amount, including accrued interest,
charges and accumulated EMIs as on the date of the Settlement
Agreement to the Bank on or before 14 July 2021, irrespective
of the sale of the Apartment, whether in one instalment or
multiple tranches.
(viii) Clause 5 was in the nature of a penalty clause. In the
event of Respondent 1 failing to pay the agreed Settled amount
and clear the Bank loan in the manner and within the time
envisaged in the Settlement Agreement, the respondents have
been made jointly and severally liable to pay, to the petitioners,
(a) the Settled amount,
(b) the entire loan amount paid and payable by the
petitioners to the Bank, and
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(c) simple interest @ 18% per annum on the unpaid
Settled amount as on 15 July 2021 from the expiry of 3
years from the date of execution of the Buyers
Agreement (2 April 2014) till the date of actual payment.
(ix) By Clause 6, the petitioners were, till the expiry of 10
months from the date of the Settlement Agreement, given the
right to retain and claim possession of the Apartment, by
issuing notice to Respondent 1. In that event, the Settlement
Agreement would stand extinguished. Undisputedly, no such
notice was ever issued by the petitioners.
(x) Vide Clause 8, Respondent 2 undertook that, in the case
of failure of Respondent 1 to pay the settled amount and clear
the Bank loan in terms of the Settlement Agreement,
Respondent 2 would be liable to pay the amounts payable by
Respondent 1 as well as for all consequences arising in that
regard.
The terms of the Settlement Agreement, and the rights and obligations
of the petitioners and the respondents thereunder are, if I may employ
a time-worn cliché, clear as crystal.
20.5 The main plank of the respondents’ argument is that, owing to
default, on the part of the petitioners, in granting no objection for sale
of the Apartment, the sale could not take place. The respondents seek
to rely on the words “in consideration of the above”, with which
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Clause 2 of the Settlement Agreement commences, to contend that all
obligations of the respondents towards the petitioners were
conditional on the petitioners cooperating in effecting sale of the
Apartment by, inter alia, tendering no objection for such sale. The
respondents believe that the Settlement Agreement contained
reciprocal obligations, the obligation of the respondents to make
monetary payments, whether to the petitioners or to the Bank being
conditional upon the petitioners providing its no objection and thereby
cooperating in the sale of the Apartment. The respondents also
invoke, in this context, the expression “on such terms and conditions”,
contained in Clause 1 of the Settlement Agreement. Mr. Nayar
contends that Respondent 1 was, therefore, entitled to call upon the
petitioners to provide its no objection for sale of the Apartment, as
one of the terms and conditions on which Respondent 1 would
execute the said Settlement Agreement. The words “irrespective of
sale of the Apartment”, contained in Clause 2, he submits, is intended
to cater to a situation in which, despite compliance, by the petitioners,
of its obligations under the Settlement Agreement, sale of the
Apartment still could not take place. In such an event, the obligation
of the respondents to make payments to the petitioners would subsist,
even though the Apartment could not be sold. No such obligation,
however, he submits, would even arise if the petitioners were in
default of their obligation to provide no objection for sale of the
Apartment, thereby hindering the sale from taking place.
20.6 The submission is, in my view, completely unacceptable.
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20.7 The Settlement Agreement, at more than one point, makes it
clear beyond doubt that the monetary obligations of the respondents –
primarily of Respondent 1 – towards the petitioners was “irrespective
of the sale of the Apartment”. The attempt of the respondents to
interlink the sale of the Apartment with their financial obligations to
the petitioners is, therefore, completely futile and cannot be accepted
for an instant.
20.8 Besides, Mr. Khan correctly submits that permission to act on
behalf of the petitioners and sell the Apartment already stood
accorded by Clause 1 of the Settlement Agreement. The only
condition, subject to which the sale of the Apartment was to be
undertaken, was obtaining of the NOC from the Bank which, too, as
per Clause 1, was the obligation and responsibility of Respondent 1.
Clause 1, nonetheless, went on to clarify that failure to obtain NOC
from the Bank would also not discharge the respondents of their
obligations under the Settlement Agreement towards the petitioners.
20.9 The words “in consideration for the above”, with which Clause
2 of the Settlement Agreement commences, cannot support the
respondents’ stand to any noticeable extent. These words merely
indicate that, as Respondent 1 had been given permission, by Clause 1
of the Settlement Agreement, to sell the Apartment and appropriate
the entire sale proceeds, Respondent 1, in consideration therefor, was
made liable to make payments to the petitioners as set out in Clause 2
and enumerated earlier in this judgment. It was in order to avoid the
possibility of the respondents adopting the stand that Mr. Nayar has
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sought to canvas before this Court, i.e., that the financial liabilities of
the respondents towards the petitioners was contingent and
conditional upon sale of the Apartment taking place, that the
Settlement Agreement, in Clause 2 and Clause 4, obligated the
respondents to make payments to the petitioners irrespective of the
sale of the Apartment. The submissions of Mr. Nayar seek to urge
precisely that which the Settlement Agreement sedulously seeks to
avoid.
20.10 It defeats comprehension, therefore, as to how the respondents
are seeking to contend, in their written submissions, that “the payment
obligations as envisaged in the SA were to accrue only after the unit
was sold and the sale consideration was appropriated by the JD”.
Needless to say, the submission is completely unacceptable, being in
the teeth of the express stipulation, in the Settlement Agreement, that
the financial obligations of the respondents were irrespective of the
sale of the Apartment.
20.11 In fact, a reading of the covenants of the Settlement Agreement
make it apparent that no obligation remained to be performed by the
petitioners, towards ensuring sale of the Apartment. Consent and
permission for such sale already stands granted by Clause 1 of the
Settlement Agreement, whereby and whereunder Respondent 1 was
authorized to act on behalf of the petitioners and sell the Apartment.
No further NOC, from the petitioners, or, for that matter, any other act
to be performed by the petitioners, is envisaged in the Settlement
Agreement. Respondent 1 has sought to contend, in its written
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submissions, that Clause 1 of the Settlement Agreement “only
authorized (Respondent 1) to identify a buyer and facilitate the sale of
the apartment to the prospective buyer”. This contention is clearly
untenable, as it is contrary to the express words in Clause 1,
whereunder the petitioners has authorized Respondent 1 “to act on
their behalf and sell the Apartment No. [1232] … along with [2]
proposed car parking(s) earmarked in the basement/Open area…” In
calling upon the petitioners to further provide NOC or permission to
sell the Apartment, therefore, the respondents were transgressing the
terms of the Settlement Agreement.
20.12 The reliance, by Mr. Nayar, on Clause 6 of the Settlement
Agreement, is also completely futile. Clause 6 merely granted the
right, to the petitioners, if it so chose, to retain possession of the
Apartment by issuing notice to Respondent 1. This was merely a
possible eventuality, which never came to pass. No such notice was
ever issued by the petitioners to Respondent 1. The Settlement
Agreement does not envisage Respondent 1 waiting for 10 months
before proceeding to sell the Apartment.
20.13 In any event, at the cost of repetition, as the financial liabilities
and responsibilities of the respondents towards the petitioners under
the Settlement Agreement are in no way linked to the sale of the
Apartment, Clause 6 can make no substantial difference to the
controversy.
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20.14 Similarly, the reliance, by Mr. Nayar, on the words “on such
terms and conditions” as contained in Clause 1, is no more than an
argument of desperation. These words merely clothed Respondent 1
with the authority to decide the terms and conditions on which the
Apartment was to be sold. These terms and conditions would, quite
obviously, be between Respondent 1 and the buyer of the Apartment.
They cannot, quite obviously, be employed by Respondent 1 to
contend that it could insist for a further NOC from the petitioners
before selling the Apartment. That, quite clearly, would amount to
rewriting the Settlement Agreement.
20.15 These findings have been returned only in view of the
respondents’ submissions that they were unable to sell the Apartment
owing to the petitioners’ default and that their financial obligations to
the petitioners under the Settlement Agreement was conditional upon,
and commenced, only when the Apartment was sold and its proceeds
realized by Respondent 1. In fact, the Settlement Agreement neither
contained reciprocal obligations, nor were the respondents entitled to
treat their financial obligations towards the petitioners as conditional
upon the Apartment being sold.
20.16 The inexorable sequitur is that, as Respondent 1 has failed to
pay the Settled amount and clear the Bank loan in the matter within
the time envisaged in the Settlement Agreement, the respondents have
been rendered jointly and severally liable to pay the entire settled
amount, along with the entire loan amount paid and payable by the
petitioners to the Bank along with simple interest at the rate of 18%
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p.a. from the date of execution of the Buyers Agreement, i.e. from 2
April 2014 till the date of actual payment.
20.17 Mr. Nayar sought to contend, apropos the respondents’ liability
to interest, that, on 13 December 2021, Respondent 1 had offered to
pay the petitioners ₹ 22.05 lakhs, so that no interest can run from that
date. This submission, too, has obviously to be rejected as, with the
default, on its part, to making payment of the Settled amount along
with all Bank dues in the manner and within the timelines envisaged
in the preceding clauses of the Settlement Agreement, the respondents
became liable to make all payments to the petitioners as were
envisaged in Clauses 5 and 6 of the Settlement Agreement.
20.18 Thus, the petitioners are clearly entitled to complete
enforcement of the Clauses of the Settlement Agreement in its favour
and against Respondents 2 and 3.
20.19 Mr. Khan has pointed out that, under cover of affidavit dated 17
May 2023, Respondent 1 has also offered the title deeds of two
agricultural properties owned by it and located at in Khata/Khatauni
No. 00215, Khasra No. 567 A Area 4.1440 Hectare & Khasra No.
567-B Area 0.0460 Hectare Total Khata No. 2 Total Area 4.1900
Hectare, Situated at Village Gajroulashiv, Par. & Tehsil & District
Bijnor, Uttar Pradesh, and agricultural Land comprised in
Khata/Khatauni No. 0004, Khasra No. 595 Area 0.228 Hectare Total
Khata No. 4 Total Area 3.351 Hectare Situated at Village
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Gajroulashiv, Par. & Tehsil & District Bijnor, Uttar Pradesh22 valued
at ₹ 19 crores. In the event of the respondents not making payments
to the petitioners in terms of the Settlement Agreement, the amounts
would have to be recovered by sale/auction of the said properties, till
which they would have to remain encumbered.
Conclusion
21. Accordingly, this Enforcement Petition is disposed of in the
following terms:
(i) The respondents are directed, forthwith, to deposit, with
the Registry of this Court, the entire amounts payable to the
petitioners in terms of Clause 5 of the Settlement Agreement,
which would include
(a) the Settled Amount as per Clause 2 of the
Settlement Agreement,
(b) the entire remaining amount to be paid to the Bank
towards the loan availed from it, and
(c) the entire amount thus far paid to the Bank by the
petitioner,
along with interest thereon @ 18% p.a. Compliance be effected
positively within 2 weeks from the date of uploading of this
judgment on the website of this Court.
22
“the two attached properties”, hereinafter
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(ii) The properties at agricultural Land comprised in
Khata/Khatauni No. 00215, Khasra No. 567 A Area 4.1440
Hectare & Khasra No. 567-B Area 0.0460 Hectare Total Khata
No. 2 Total Area 4.1900 Hectare, Situated at Village
Gajroulashiv, Par. & Tehsil & District Bijnor, Uttar Pradesh,
and agricultural Land comprised in Khata/Khatauni No. 0004,
Khasra No. 595 Area 0.228 Hectare Total Khata No. 4 Total
Area 3.351 Hectare Situated at Village Gajroulashiv, Par. &
Tehsil & District Bijnor, Uttar Pradesh shall stand attached.
The respondents are restrained from dealing with the said
properties in any manner till the entire dues of the petitioners
are paid as directed in (i) supra.
(iii) List before the Joint Registrar to ensure compliance with
the above directions on 18 September 2024.
(iv) In the event of the respondents failing to liquidate the
petitioner’s dues as directed hereinabove within 2 weeks from
the date of uploading of this judgment on the website of this
Court, the two attached properties shall be put to auction, for
which purpose the Joint Registrar shall renotify this matter
before the Court for directions.
(v) In the event of the amounts payable to the petitioners as
set out in (i) supra being paid within two weeks, the attachment
of the two attached properties shall stand lifted and the title
deeds would be returned to the respondents.
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22. The Enforcement Petition stands allowed in the aforesaid terms.
OMP (Enf) (Comm) 9/2022, OMP (Enf) (Comm) 10/2022, OMP
(Enf) (Comm) 149/2021, OMP (Enf) (Comm) 168/2021, OMP
(Enf) (Comm) 172/2021, OMP (Enf) (Comm) 174/2021
23. The petitioners in these petitions are also purchasers and
investors in the respondent’s scheme. There is no difference between
the facts of these cases and those in OMP (Enf) (Comm) 148/2021,
except that the project in OMP (Enf) (Comm) 149/2021 and OMP
(Enf) (Comm) 174/2021 is the ‘ATP Tourmaline’ and that in OMP
(Enf) (Comm) 9/2022, OMP (Enf) (Comm) 10/2022, OMP (Enf)
(Comm) 168/2021, OMP (Enf) (Comm) 172/2021 is the ‘ATP
Triumph’. Else, the issues of fact and law are identical. In all these
cases, Settlement Agreements, identical to that in OMP (Enf) (Comm)
148/2021, on the basis of which the Section 9 petitions filed by the
petitioners were disposed of, have been executed. The covenants of
the Settlement Agreements are also identical. The reasoning and
conclusions in OMP (Enf) (Comm) 148/2021 would, therefore, apply
mutatis mutandis to these petitions.
24. Mr. Khan had handed over, in Court, a chart depicting the
amounts payable under the Settlement Agreements to each of the
petitioners in these petitions. The chart constitutes Annexure A to this
judgment. Inasmuch as there is no traversal to the figures in the chart,
in the written submissions which subsequently came to be filed by the
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respondents, the Court proceeds on the premise that the figures in the
chart represents the correct amounts payable.
25. These petitions, too, therefore, are allowed in terms of the
judgment rendered today in OMP (Enf) (Comm) 148/2021.
C. HARI SHANKAR, J.
SEPTEMBER 3, 2024
yg
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Annexure A
OVERVIEW OF AMOUNTS PAYABLE BY JUDGMENT
DEBTORS IN ACCORDANCE WITH THE RESPECTIVE
SAMADHAN AGREEMENT OF INDIVIDUAL DECREE
HOLDERS
Sl. Name of the Amount due Amount owed Total amount
No Decree Holder to Decree to the Bank due to the
Holder as on Decree
including 31.03.2022 Holder and
interest Bank
as on as on
31.03.2022 31.03.2022
1. Mr Anand ₹1,87,30,906 ₹2,02,63,444 ₹3,89,94,350
Gupta and Mrs
Anuradha
Vinod Gupta
2. Mr. Gagandeep ₹84,85,023 ₹1,15,54,200 ₹2,00,39,223
Singh Puri
3. Mr ₹1,32,07,660 ₹1,57,80,392 ₹2,89,88,052
Lakshminaraya
nan P.R
4. Mr Maneesh ₹1,51,17,217 ₹1,59,11,734 ₹3,10,28,951
Goel
5. Mr. Navdeep ₹86,36,394 ₹1,14,24,092 ₹2,00,60,486
Shergill
6. Mr. Anurag ₹1,02,91,180 ₹1,58,65,159 ₹2,61,56,339
Jain
7. Mr. Deepak ₹1,04,67,156 ₹1,50,46,023 ₹2,55,13,179
Tiwari
GRAND ₹8,49,35,536 ₹10,58,45,044 ₹19,07,80,580
TOTAL
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OMP(ENF)(COMM) 148/2021 & conn. matters Page 45 of 45 Signature Not Verified
Digitally Signed Digitally Signed
By:AJIT KUMAR By:CHANDRASHEKHAR
AN HARI SHANKAR
Signing Signing Date:04.09.2024
Date:04.09.2024 22:59 22:56