First appellant in regular first appeal challenged a money decree. holding the paid amount was an advance not earnest money as misdescribed, the appeal failed to succeed, and the appellant was liable to refund the entire advance.
The appeal is dismissed. The appellant has to refund the advance amount to the plaintiff.
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IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE SATHISH NINAN
WEDNESDAY, THE 14TH DAY OF AUGUST 2019 / 23RD SRAVANA, 1941
RFA.No.802 OF 2011
AGAINST THE DECREE AND JUDGMENT IN OS 466/09 DATED 29.6.11 PASSED BY THE COURT OF ADDITIONAL SUBORDINATE JUDGE, IRINJALAKUDA
APPELLANT/IST DEFENDANT:
THOMAS, AGED 51 YEARS, S/O.ELENJIKKAL MENANCHERY DOMINIC, ALATHOOR VILLAGE,DESOM, MUKUNDAPURAM TALUK.
BY ADVS. SRI.A.RANJITH NARAYANAN SRI.S.K.SAJU
RESPONDENT/PLAINTIFF AND DEFENDANTS 1 AND 2:
1 BABY, AGED 45 YEARS, S/O.MOONJELY JOSEPH,THURAVOORKARA, THURAVOOR VILLAGE,ALUVA TALUK - 683586.
2 SURENDRAN, AGED 64 YEARS, S/O.KAYAMPURATH AYYARUKUTTY, VELLANI DESOM, KARALAM VILLAGE, MUKUNDAPURAM TALUK 680 711.
3 DEVAYANI,AGED 61 YEARS, W/O.KAYAMPURATH SURENDRAN, VELLANI DESOM, KARALAM VILLAGE,MUKUNDAPURAM TALUK, 680 711.
R1 BY ADV. SRI.M.H.HANIL KUMAR
R1 BY ADV. SRI.P.A.ROY
THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 14-08-2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
SATHISH NINAN, J.
= = = = = = = = = = = = = = = = = = RFA No.802 of 2011
= = = = = = = = = = = = = = = = = = Dated this the 14th day of August, 2019
J U D G M E N T
Challenging a decree for money, the first defendant is in appeal.
19,100/- per cent. An amount of 5,25,000/- was paid towards advance sale consideration. Alleging failure on the part of the first defendant to perform the contract and alleging that there is an encumbrance over the property, the suit is filed for recovery of the advance sale consideration paid.RFA No.802 of 2011
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thereto that Ext.A1 agreement was entered into with the plaintiff. According to the first defendant, the plaintiff failed to perform in terms of Ext.A1 which resulted in the breach of Ext.A1 contract as well as the agreement entered into by him with defendants 2 and 3. It is further contended that consequent on the breach of contract between him and defendants 2 and 3, he has suffered damages.
RFA No.802 of 2011
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entered into between the first defendant and defendants 2 and 3 in respect of the property in question failed. However, the learned counsel for the appellant - first defendant submitted that the breach of contract entered into by the first defendant with defendants 2 and 3 occurred consequent on the failure of the plaintiff to pay the amounts as stipulated in Ext.A1. As noticed, there is lack of evidence as to at whose fault the breach occurred.
RFA No.802 of 2011
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affidavit of PW1 it has been stated that the amount is paid as advance sale consideration. It is specifically stated therein that the amount does not represent earnest money. The said contention of PW1 is not challenged in cross examination. Earnest money is paid to show the earnestness of the purchaser. It represents the very small portion of the purchase price. At the time of making the payment, it is intended only to secure the due performance of the contract. However, in the case at hand, it is evident that the amount paid is towards part of the sale consideration. It can only be concluded that the amount paid under Ext.A1 partakes the character of advance, and not earnest money.
defendant claimed to be towards refund of `3.5 lakhs which the first defendant claims to be part
RFA No.802 of 2011
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of 5 lakhs paid by him as advance under the agreement for sale with them. It is his case that the remaining amount of 1.5 lakhs was forfeited consequent on the breach of agreement with them. This is hardly sufficient to find the case of damages set up by the first defendant. In the absence of any proof regarding damages, he is liable to re-fund the entire advance amount received under Ext.A1 to the plaintiff.
In the result, this appeal fails and is dismissed. No costs.
Sd/SATHISH NINAN JUDGE
kns/-
//True Copy//
P.S. to Judge
3 issues framed by the court
Whether the sum paid under the agreement is earnest money or advance sale consideration.
Whether the appellant is liable to refund the amount without proving damages or if it constitutes forfeiture.
Whether the trial court's award of interest at 6% is sustainable.
THOMAS
BABY
SURENDRAN
DEVAYANI
SATHISH NINAN
As recorded by the court registry
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