legal aspect of business assignment

7/30/2019 Legal Aspect of Business Assignment

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Page 1 of5ASSIGNMENT13th May 2013Assignment/NMP26-07/LAB/01

DATE NATURE PAGEDOCUMENT NUMBER

Thisdocumentisthepro

pertyofManagementDevelopmentInstitute,

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ASSIGNMENT ON CASE ANALYSIS

MDI

GHAZIABAD DEVELOPMENT AUTHORITYGHAZIABAD DEVELOPMENT AUTHORITYGHAZIABAD DEVELOPMENT AUTHORITYGHAZIABAD DEVELOPMENT AUTHORITY

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UNION OF INDIAUNION OF INDIAUNION OF INDIAUNION OF INDIA

Submitted by:

GROUP # 7Jewel Christy Jose 26NMP26

Piyush Monga 26NMP33

Prashant Singh 26NMP35

Shiv Bhavan 26NMP53

Swaraj Mallick 26NMP10

Vikas Bhardwaj 26NMP58

MANAGEMENT DEVELOPMENT INSTITUTE

GURGAON

13 MAY 2013


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Table of Contents

S. No. Title Page No.

- Cover page 1

- Table of Contents 2

1 Introduction 3

2 Issue(s) 3

3 Question(s) 4

4 Relevant Legal Provision(s) 4

5 Decision(s) 5


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1. Introduction:

Ghaziabad Development Authority Appellant

Union of India and Another Respondent

Date of Judgment: 12/05/2000

Bench: RC Lahoti, SR Babu

Ghaziabad Development Authority had been constituted under section 4 of the Uttar

Pradesh Urban Planning and Development Act, 1973. The Authority has from time to

time promoted and advertised several schemes for allotment of developed plots for

construction of apartments and/or flats for occupation by the allottees. Several persons

who have subscribed to the schemes approached different forums complaining offailure or unreasonable delay in accomplishing the schemes.

2. Issue(s):

The decisions taken by different forums (before the matter reached Supreme Court) are

summarized below:

Brief of Cases/Petitions Judgment(s)

Civil Writ petitions under article 226 of

the constitution before High Court ofAllahabad.

The term in the brochure issued by

Authority(GDA) that in the event of theapplicant withdrawing its offer orsurrendering the same, no interestwould be payable to the claimants washeld violative of Article 14 of theconstitution.

The court directed the amount dueand payable to be refunded withinterest calculated at the rate of 12percent per annum from the date ofdeposit to the date of refund.

G.D.A. Vs Brajesh Mehta before the

Monopolies and Restrictive TradePractices Commission (MRTP)

The MRTP commission has held the

claimants entitled to an amount of `50,000/= as compensation for mentalagony suffered by the claimants.

In all other appeals before the SC, the commission or forum (Consumer DisputesRedressal Forum) directs payment of the amount due to the claimants with interestat the rate of 18%.

GDA had appealed to the Supreme Court for review of the above decisions. The

appeals were heard together in reference to common questions of law as detailed in

Para 3.


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3. Question(s):

The questions arisen for decision were:

1. Whether compensation can be awarded for mental agony suffered by theclaimants?

2. Whether in the absence of any contract or promise held out by Ghaziabad

Development Authority, any amount by way of interest can be directed to be

paid on the amount found due and payable by the Authority to the claimants?

3. If so, the rate at which the interest can be ordered to be paid?

4. Relevant Legal Provision(s):

The Indian Contract Act, 1972 (specifically section 73)

The Specific Relief Act, 1963

The principle is to put the aggrieved party monetarily in the same position as far as

possible in which it would have been if the contract would have been performed.

For Mental Agony:

Chitty on Contracts (27th Edn, Vol 1, Para 26.041):

o Normally no damages will be awarded for mental anguish or distress

except in contracts whose purpose is to provide peace of mind or

freedom from distress

o Damages for anguish and vexation caused by breach of contract

cannot be awarded in an ordinary commercial contract.

For Award of Interest:

o The general provision of section 34 of Civil Procedure Code (CPC)

being based on justice, equity and good conscience would authorize

the Redressal Forums and Commissions to award interest on

equitable grounds.


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5. Judgement(s):

o No payment for Mental Agonyo Awarding of interest at the rate of 12% per annum to the claimants for cases

under consideration.

o The provision contained in the brochure issued by the Development Authority

that it shall not be liable to pay any interest in the event of an occasion arising

for return of the amount should be held to be applicable only to such cases in

which the claimant is itself responsible for creating circumstances providing

occasion for the refund.

o In the case relating to allotment of a flat (Civil Appeal No. 8482 of 1997), an

option was given to claimant for allotment of an alternative flat to which the

claimant was not agreeable on account of location & high price. The refund of

amount to the claimant with rate of interest 12% per annum has been directed

by the court.

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