Courts Cannot Rewrite or Create a New Contract and Have to Simply Rely on The Terms and Conditions of The Agreement as Agreed Between the Parties
This was observed by the Hon’ble Supreme Court while deciding an Appeal filed against an order of the National Consumer Dispute Redressal Commission (“NCDRC”) rejecting the Appellant/ Buyer’s Application seeking termination of the Agreement and refund of the consideration.
Brief background of the case,
As per the terms of the contract, in case the Respondent fails to obtain the Occupation Certificate before the expiry period, the Appellant would have an option of election to terminate the contract and claim full refund of consideration paid.
However, NCDRC while rejecting the Appellant’s right to terminate the contract seeking refund of consideration observed that, “there was some delay in handling over the possession of the apartment by the Respondent company but it was not ‘unreasonable’, whereby the Appellants could cancel the Agreement and seek a refund.” In doing so, the NCDRC gave new interpretation of the contract entered between the Appellants and Respondents/ Seller for the purchase of an apartment.
Issue for Consideration
Whether the NCDRC can rewrite the terms and conditions of the covenants binding on the parties or make a new contract based on its interpretation?
Supreme Court’s Observation
The Hon’ble Supreme Court ruled that the Appellant/ Buyer’s action of terminating the Agreement on the date, as stipulated therein, cannot be deemed defective if the Respondent fails to furnish the ‘Occupation Certificate’ before the period expires.
The Supreme Court while setting aside the impugned order passed by the NCDRC observed that disregarding the legally enforceable covenants in the Agreement and using its own logic and reasoning to determine the parties’ and, more specifically, the Appellants, best course of action going forward, the NCDRC overreached its authority and jurisdiction.
CASE DETAILS: Venkataraman Krishnamurthy & Anr v. Lodha Crown Buildmart Pvt. Ltd.,[1]
[1] Civil Appeal No. 971 of 2023
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- Courts Cannot Rewrite or Create a New Contract and Have to Simply Rely on The Terms and Conditions of The Agreement as Agreed Between the Parties