The Supreme Court reiterated that no additional price can be demanded for the allotment of the plot if no such clause exists in the allotment letter or the lease-cum-sale agreement signed between the parties. The Court while holding so dismissed the appeal filed by the Belgaum Urban Development Authority (BUDA).

Noticing that even though sale consideration as such has not been mentioned in the lease-cum-sale agreement, however, the price as negotiated between the parties is clearly mentioned in the letter of allotment, a two-judge Bench of Justice Abhay S. Oka and Justice Rajesh Bindal observed that "the price as negotiated between the parties has to be read as part of the lease-cum-sale agreement".

Advocate Anuradha Mutatkar appeared for the Appellant and Advocate Anil Kumar appeared for the Respondent.

In a brief background, the Respondent made an application to the Appellant (Belgaum Urban Development Authority) for allotment of residential site, which was granted, and possession of the site was handed over to the Respondent. Thereafter, lease-cum-sale agreement was executed in favour of Respondent. As demand for additional price for the plot was raised from the Respondent, a suit was filed, wherein the Trial Court decreed the suit. When the matter reached High Court, the Appellant was directed to execute the sale deed in favor of Respondents and further directed to refund the additional price paid by the Respondents.

After considering the submissions, the Apex Court found from the perusal of clause-5 in the allotment letter that, option has been given to vary the price of the plot in case there is a change in the size of plot.

Observing that the entire clause has to be read in totality and no part in isolation, the Apex Court clarified that clause-5 does not talk about demand of additional price on account of any other factor specially the one raised in the present appeals, namely, on account of enhancement of compensation on account of acquisition of land for carving of the plots.

Even the clauses as contained in the lease-cum-sale agreement also does not come to the rescue of the Appellant for the reason that it talks about the negotiated price between the vendor and the vendee. The vendor in the case at hand is the Appellant and the vendee is the Respondent”, added the Bench.

The Bench took support from the decision of this Court in the case of Preeta Singh (Km) and others v. Haryana Urban Development Authority and Others [(1996) 8 SCC 756], wherein referring to the Section 2(aa) of the Punjab Urban Estate (Sale of Sites) Rules, 1965 which defines “additional price”, as the allotment was in terms of the aforesaid rules, demand of additional price on account of enhanced compensation for the acquisition of land which was utilized for carving of the plots was upheld.

Accordingly, the Apex Court dismissed the appeal.

Cause Title: The Belgaum Urban Development Authority vs. Dhruva & Anr.

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