Allowed

M.v.Selvaraj v. N.a.Vijayan Achari

Kerala HC14 Aug 2019RFA/506/2004

Case brief

AI extract

What is this about?

The High Court altered a specific performance decree. Finding the plaintiffs failed to prove genuine offer and acceptance due to inflated consideration relative to the property value, the court awarded their payment as a debt instead.

What did the court decide?

Plaintiffs granted decree for realisation of Rs.7,08,000 with 9% interest from date of agreement, creating a charge on the property and assets of the defendants.

M.v.Selvaraj Vs N.a.Vijayan Achari — Contract and Commercial Disputes | Kerala HC (2019)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE SATHISH NINAN

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WEDNESDAY, THE 14TH DAY OF AUGUST 2019 / 23RD SRAVANA, 1941

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RFA.No.506 OF 2004(C)

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AGAINST THE JUDGMENT IN OS 109/1999 DATED 23-06-2004 OF SUB COURT, MAVELIKKARA

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APPELLANTS/DEFENDANTS 2 & 3:

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1 M.V.SELVARAJ, MOOLAPADAVIL, ASHVATHY BHAVAN, ANGADIKAL MURI, CHENGANOOR VILLAGE, CHENGANNOOR TALUK.

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2 M.V. MURUKESH, MOOLAPADAVIL, ASHVATHY BHAVAN, ANGADIKAL MURI, CHENGANOOR VILLAGE, CHENGANNOOR TALUK.

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BY ADVS.

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SRI.S.SANAL KUMAR SMT.BHAVANA VELAYUDHAN

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RESPONDENTS/PLAINTIFFS:

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1 N.A.VIJAYAN ACHARI NAVARATHNA BHAVAN, AZHURU MURI, PATHANAMTHITTA VILLAGE, KOZHENCHERY TALUK.

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2 N.A. SELVAN ACHARI, NAVARATHNA BHAVAN, AZHURU MURI, PATHANAMTHITTA VILLAGE, KOZHENCHERY TALUK.

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R1 & 2 BY ADV. SRI.G.SREEKUMAR CHELUR

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THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 14.08.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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SATHISH NINAN, J.

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= = = = = = = = = = = = = = = = = = RFA No.506 of 2004

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= = = = = = = = = = = = = = = = = = Dated this the 14^th day of August, 2019

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J U D G M E N T

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Defendants 2 and 3 assails the decree for specific

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performance of an agreement for sale.

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The first defendant, who is the mother of

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defendants 2 and 3, was the owner of the property in question. She died pending the suit. As per order dated 07.03.2000 on I.A No.1305 of 1999, defendants 2 and 3

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were recorded as her legal heirs. Defendants 2 and 3 joined the agreement as persons in possession of the property.

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Ext A1 dated 21.12.1998 is the agreement sought

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to be specifically enforced. The property which is the subject matter of Ext A1 has an extent of 30 cents with a residential building thereon. It is agreed to be conveyed to the plaintiffs for a total consideration of Rs. 8 lakhs. An amount of Rs.7,08,000/- is stated to

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have been paid towards advance sale consideration. The

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RFA No.506 of 2004

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:- 3 :-

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period fixed for performance is six months. Alleging failure on the part of the defendants to honour Ext A1, the suit is filed.

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The first defendant died even before filing written statement. Defendants 2 and 3 filed written statement denying Ext A1. According to them, their mother the first defendant was ailing due to various illness. They borrowed Rs.70,000/- from the plaintiffs and as required by them, signed blank papers were entrusted by defendants 2 and 3. The signature of first defendant in Ext A1 is disputed. Accordingly they prayed for dismissal of the suit.

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The trial court upheld Ext A1 and granted a decree for specific performance.

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Heard Sri.S.Sanal Kumar, learned counsel for the appellants - defendants and Sri.Sreekumar Chelur, learned counsel for the respondents – plaintiffs.

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Though the signature of the first defendant in Ext A1 is disputed by the defendants and it is contended

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RFA No.506 of 2004

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:- 4 :-

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that on the date of Ext A1 the first defendant was undergoing treatment at the Pushpagiri Hospital, Thiruvalla, no documents evidencing the same has been produced. In the cross examination of DW1, it was admitted that the discharge summary is available. However, it is not produced. Records evidencing that she was in the hospital on the relevant date would have been the best evidence to prove that the first defendant has not signed Ext A1. The best evidence has been withheld. This leads to drawing of adverse inference against the defendants. That apart, DW1 during the cross-examination has admitted the signature of the first defendant in the second page of Ext A1. According to defendants 2 and 3, signed blank papers have been fabricated into Ext A1. Prior to the suit, the plaintiffs caused Ext A5 notice to be issued to the defendants. The receipt of the notice is admitted; however no reply was issued denying/challenging Ext A1. Though an attempt was made to explain it away stating that it was an omission on

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RFA No.506 of 2004

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:- 5 :-

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the part of the advocate to whom it was entrusted for issuing reply, the same does not inspire confidence. The trial court has on appreciation of the evidence, upheld Ext A1. No material to dislodge the said finding is placed before me. Therefore I concur with the finding of the trial court regarding the genuineness of Ext A1.

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Now coming to the consideration that has passed between the parties, as per Ext A1 an amount of Rs.7,08,000/- has been paid whereas according to the defendants, only an amount of Rs.70,000/- was received by them. Though Ext A1 recites that Rs.7,08,000/- was paid in a lump on the date of Ext A1, PW1 in his chief examination has stated that the amounts were paid in instalments on various occasions. According to him, till

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the date of Ext A1 he had paid an amount of Rs.6,08,000/- and on the date of Ext A1 an amount of Rs.1 lakh was borrowed from PW3, thus making the total payment at Rs.7,08,000/-. Exts A6 to A8 Bank pass books evidence withdrawal of amounts by the plaintiffs on

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RFA No.506 of 2004

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various occasions, totalling to Rs.6,08,000/-. Though no receipts or documents were obtained by the plaintiffs at the time of payment of amounts to the defendants, it is to be noticed that the parties are first cousins. In view of the near relationship, the transaction cannot be ruled out merely for the non obtaining of receipts or documents at the time of advancing the amounts. Ext A1 agreement recites regarding payment of Rs.7,08,000/-. I have already held Ext.A1 to be genuine. There is no reason to find that the amount as mentioned therein was not paid to the defendants. Therefore, I concur with the trial court that the plaintiffs paid a total amount of Rs.7,08,000/- to the defendants.

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Now coming to the question as to whether the plaintiffs are entitled for a decree for specific performance, the relief of specific performance has its roots in equity, and the mere upholding of an agreement does not by itself entail a decree for specific performance. The conduct of the party who approaches the

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RFA No.506 of 2004

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:- 7 :-

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Court seeking the relief is of much significance. As noticed above, though Ext A1 recites payment of an amount of Rs.7,08,000/- on the date of Ext A1, the plaintiffs have a totally different case at the time of evidence, regarding payment in instalments. In the cross-examination of PW1 it is admitted that the payments have been made on various dates which ranges up to a period of almost two years prior to the date of Ext A1. It is also admitted that the payments were not originally intended as payment towards advance sale consideration and that the thought of entering into a sale agreement was formed only few days prior to execution of Ext A1. Even according to the plaintiffs, the market rate for the property is only 7,500/- per cent thus making the total price for the land at Rs.2,25,000/-. According to PW1 the value of the building situated in the property is Rs. 1 lakh. Therefore, even according to the plaintiffs, the total value of the property agreed to be conveyed under Ext A1

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RFA No.506 of 2004

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:- 8 :-

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is only Rs.3,25,000/-. However, Ext A1 recites the total sale consideration at Rs.8 lakhs. Though PW1 offers an explanation that the said consideration was agreed to in view of the close relationship between the parties, the same cannot be accepted without a pinch of salt. The parties are first cousins. DW1 has spoken to that the property covered under Ext A1 is the only residential property of the defendants. It is not challenged by the plaintiffs. Suffice to notice that on the entire materials, the only conclusion possible is that, the discretion has to be exercised against the plaintiffs in negativing the prayer for specific performance. The trial court has not appreciated the various aspects noticed above. The judgment of the trial court granting a decree for specific performance is liable to be interfered with, and I do so.

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Having enjoyed the benefit of Rs.7,08,000/-,

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the defendants are bound to return the same to the plaintiffs with reasonable interest thereon. Considering

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RFA No.506 of 2004

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:- 9 :-

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the prevalent rate of interest, I deem it appropriate that the interest be fixed at 9% per annum from the date of Ext A1.

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In the result, this appeal is allowed. The decree and judgment of the trial court are set aside. The plaintiffs are granted a decree for realisation of Rs.7,08,000/- with interest at the rate of 9% per annum from 21.12.1998 (date of Ext A1) till realisation, from the plaint schedule property as a charge and by sale of it, and from the assets of the first defendant that has devolved upon defendants 2 and 3 and are available with them. No costs.

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Sd/SATHISH NINAN JUDGE

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vdv/-

M.v.Selvaraj v. N.a.Vijayan Achari

Case brief

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M.v.Selvaraj v. N.a.Vijayan Achari

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