Satish Batra vs Sudhir Rawal

The Supreme Court held that a seller is not entitled to forfeit the entire earnest money deposit of Rs.7,00,000/- when the purchaser fails to pay the balance amount, as per the terms of the Agreement for Sale dated 29.11.2005. The Court referenced the precedent set in Fateh Chand v. Balkishan Dass AIR 1963 SC 1405, establishing that only a nominal amount can be forfeited, allowing the seller to retain Rs.50,000/- and mandating the return of Rs.6,50,000/- to the purchaser along with interest at 12% per annum. The Court upheld the High Court's decision, affirming the principle of proportionality in forfeiture of earnest money.