The Delhi High Court held that the writ petition filed in an attempt to renovate the contract is not permissible under law. A contract cannot be rewritten between the parties by the High Court while exercising Writ Jurisdiction. The terms of the contract are to be altered mutually only as provided under Section 62 of the Indian Contract Act, 1872.
Brief Facts:
The Appellant is a part of Supertech Group, a real estate developer. Financial assistance was sought by the Appellant from a consortium of Banks for a project. The said financial assistance was agreed upon by the consortium of Banks and a term loan was also sanctioned. In 2018, the account of the Appellant was categorized as Non-Performing Asset (hereinafter referred to as “NPA”).
Thereafter, negotiations were held between the parties and a one-time settlement was reached. This settlement was modified mutually and further amended as per the modifications.
The dispute between the parties arose as the Appellant failed to pay the monthly instalments despite letters being served by the Bank.
Brief Background:
The Appellant contended that no amount or instalment was due and filed the present Writ Petition to seek writ for quashing of the said letters and directing Respondent to extend the period of moratorium.
The said writ petition was dismissed by the Learned Single Judge on grounds that any alteration in the terms of the contract can only be done by mutual consent of the parties as per Section 62 of the Indian Contract Act, 1872.
The present appeal has been filed against the said order.
Observations of the Court:
As per the terms of the modified settlement letter, the balance amount was to be paid in 24 instalments after 3 months moratorium from the date of conveying the original sanction to the borrower.
The issue between the parties was about the date from which the moratorium period had to be calculated. The Learned Single Judge held that the moratorium will be calculated from the date of conveying the original sanction to the Borrower.
The High Court opined that the terms of the settlement unequivocally stated that 3 months moratorium will be calculated from the date of conveying the original sanction to the borrower.
It was held that the writ petition was filed in an attempt to renovate the contract which is not permissible. A contract cannot be rewritten between the parties by the High Court while exercising writ jurisdiction. The terms are to be altered mutually only.
The decision of the Court:
Based on the above-mentioned reasons, the Delhi High Court dismissed the appeal.
Case Title: Supertech Realtors Pvt. Ltd. V. Bank of Maharashtra
Coram: Hon’ble Chief Justice Mr. Satish Chandra Sharma, Hon’ble Mr. Justice Subramonium Prasad
Case No.: LPA 676/2022
Advocates for Appellant: Advs. Ms. Maninder Acharya, Mr. Ishan Dewan, Mr. V. Siddharth, Mr. Viplav Acharya, Ms. Udita, Ms. Priyal Bopana
Advocates for Respondent: Advs. Mr. Nishant Awana, Mr. G.S. Awana, Ms. Monika Arora, Mr. Yash Tyagi, Mr. Shivam Raghuwanshi
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