Dismissed

K.M.Suresh Babu v. Chalil Kunhikrishna Kurup

Kerala HC23 Oct 2020RFA/237/2006

Case brief

AI extract

What is this about?

This appeal challenged a decree for refund of an advance payment based on an alleged agreement for sale. The High Court reviewed the evidence, rejected claims of forgery and blank documents, upheld the execution of the agreement, confirmed the respondent's breach, and dismissed the appeal. A subsequent review allowed a modification to the interest rate.

What did the court decide?

The appeal and cross objection were dismissed; the judgment was incorporated with a note regarding a later review modifying the interest rate to 6% per annum.

K.M.Suresh Babu Vs Chalil Kunhikrishna Kurup — Contract and Commercial Disputes | Kerala HC (2020)

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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 T.V.ANILKUMAR

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FRIDAY, THE 23RD DAY OF OCTOBER 2020 / 1ST KARTHIKA, 1942

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RFA.No.237 OF 2006

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AGAINST THE JUDGMENT AND DECREE IN OS 105/2002 DATED 29-072005 OF PRINCIPAL SUB COURT, KOZHIKODE

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APPELLANT/DEFENDANT:

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K.M.SURESH BABU RESIDING AT DHANYAM,KALATHINKUNNU AMSOM AND DESOM,, KOZHIKODE TALUK.

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BY ADVS. SRI.V.R.KESAVA KAIMAL SRI.P.VISHNU PRASAD

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RESPONDENT/PLAINTIFF:

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CHALIL KUNHIKRISHNA KURUP S/O.KANARA KURUP, RESIDING AT `SIVOHAM',, MALAPARAMBA HOUSING COLONY,, CHEVAVOOR AMSOM AND DESOM,, KOZHIKODE TALUK.

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BY ADVS. SRI.M.KRISHNAKUMAR SMT.PRABHA R.MENON

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THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 21-10-2020, ALONG WITH CO.74/2006, THE COURT ON 23-10-2020 DELIVERED THE FOLLOWING:

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R.F.A.No.237 of 2006 & CO 74/2006

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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 T.V.ANILKUMAR

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WEDNESDAY, THE 23RD DAY OF OCTOBER 2020/ 1ST KARTHIKA, 1942

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CO.No.74 OF 2006 IN RFA. 237/2006

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AGAINST THE JUDGMENT AND DECREE IN OS 105/2002 DATED 29-072005 OF PRINCIPAL SUB COURT, KOZHIKODE

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CROSS OBJECTOR/RESPONDENT/PLAINTIFF

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CHALIL KUNHIKRISHNA KURUP S/O.KANARA KURUP, `SHIVOHAM', MALAPARAMBA, HOUSING COLONY, CHEVAYOOR AMSOM AND DESOM,, KOZHIKODE TALUK.

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BY ADVS. SMT.PRABHA R.MENON SRI.M.KRISHNAKUMAR

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RESPONDENT/APPELLANT/DEFENDANT:

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K.M.SURESH BABU `DHANYAM', KALATHINKUNNU AMSOM AND DESOM,, KOZHIKODE TALUK.

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THIS CROSS OBJECTION HAVING BEEN FINALLY HEARD ON 2110-2020, ALONG WITH RFA.237/2006, THE COURT ON 23-10-2020 DELIVERED THE FOLLOWING:

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R.F.A.No.237 of 2006 & CO 74/2006

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Dated this the 23^rd day of October, 2020

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J U D G M E N T

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The appellant is the sole defendant in O.S.No.105/2002 on the file of Subordinate Judge, Kozhikode. He suffered a decree for return of

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advance amount charged on the plaint schedule property belonging to him. Rejecting his contention that he did not execute Ext.A1 agreement for sale dated 31.8.1999, the court below passed decree in favour of the respondent/plaintiff for an amount of Rs.2,50,000/- with interest.

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The appellant is the owner of undivided

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share of 82/432 in the plaint schedule 45 cents

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held by him under partition deed No.840/2002. There is no dispute as to his fractional ownership in the plaint schedule property. While the defendant challenged the decree granting relief claimed in the suit, the plaintiff being aggrieved by refusal

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of costs, filed a Cross Objection.

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The respondent's case is that the appellant

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agreed to sell his undivided share for a total sale consideration of Rs.6 lakhs within a term of one

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year and after receiving advance amount of Rs.2 lakhs, he executed Ext.A1 unregistered agreement for sale on 31.8.1999. The appellant also agreed to handover the title deed of the property along with the encumbrance certificate on completion of the

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term. Since he failed in the promise made, the respondent revoked the agreement and sent Ext.A2 suit notice on 28.2.2002 demanding return of

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advance money. The appellant sent Ext.B1 reply denying execution of agreement for sale and the

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alleged receipt of advance amount. It was in that circumstance, suit for money charged on the plaint property was laid in the court below.

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According to the appellant, he approached

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the respondent who is a money lendor only for

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R.F.A.No.237 of 2006 & CO 74/2006

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taking a loan amount of Rs.15,000/-. Seeing the

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appellant to be in urgent need for money, the

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respondent insisted him to sign a few blank papers which were partly filled up promising that the

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papers were taken only as security for repayment of borrowed amount and would not used for any other

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purpose.

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denied that he agreed for sale of his undivided share and further he had intention to sell also. He denied having received Rs.2 lakhs or agreed for sale extending to a term of one year for a price of Rs.6 lakhs. He raised a specific contention that the papers signed by him were fabricated and forged later into Ext.A1 agreement for sale which under law is void and unenforceable.

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The court below framed issues of which the

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material question that was considered related to execution of Ext.A1 agreement for sale. The court

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R.F.A.No.237 of 2006 & CO 74/2006

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below examined the question as to whether the respondent discharged his burden as to proof of execution of Ext.A1 and the transaction was supported by consideration.

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On the side of respondent, Exts.A1 to A3

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were tendered in evidence and he got examined as PW1. A witness cited as a close relative of the appellant was summoned and examined as PW2 on his side. The appellant gave evidence as DW1 and tendered Ext.B1 reply notice in evidence.

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On consideration of rival contentions and

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entire evidence on record, the court below, having regard to the admission of signatures in Ext.A1 and the education of the appellant and other circumstances of the case held that respondent's case that appellant executed Ext.A1 agreement for sale after understanding the contents thereof, was

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highly probable. The court below took a specific

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view that the evidence on record did not indicate

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R.F.A.No.237 of 2006 & CO 74/2006

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that Ext.A1 was a blank document when the appellant had affixed his signatures. The court below also found that the appellant signed Ext.A1 with the intention of selling his undivided share for consideration and his case that the document came into being in connection with a loan transaction with respondent was improbable. The evidence of PW2 was also relied on in this respect. A decision cited on behalf of the appellant reported in Velayudhan v. Velayudhan (2001(1) KLT 392) was distinguished by the court below holding that it did not apply to the facts on hand. Minor discrepancies in the evidence of respondent were ignored and were held to be insufficient to affect the reliability of his case.

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I heard the learned counsel for the

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appellant and the counsel for the respondent.

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The contention of the learned counsel for

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the appellant is that Ext.A1 is a fabricated and

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R.F.A.No.237 of 2006 & CO 74/2006

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forged document which did not create any liability on the appellant. He did not execute an agreement for sale and his mere admission of signatures in Ext.A1 was mistaken by the court below as admission of execution of Ext.A1. It was also contended that the finding as to execution being the result of misreading of evidence and against the broader probabilities of the case, the entire judgment and decree are vitiated. The learned counsel drew my attention to testimony of PW1 wherein he admitted that there were some additions in different ink and hand and also corrections in Ext.A1 document. It is also contended that the burden to prove execution lay exclusively on the respondent which he failed to establish by citing the witnesses in Ext.A1. PW2 admittedly is not an attesting witness in Ext.A1 and further his own evidence revealed that he was inimical to appellant rather than being cordial as claimed by the respondent. In short, the contention

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R.F.A.No.237 of 2006 & CO 74/2006

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is that the only evidence that remained on record

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were rival versions given by parties on oath against oath as against each other and hence preponderance of probabilities only weighed in favour of the appellant. The learned counsel contended that the market value of the undivided share was far less than Rs.6 lakhs as found by the court below itself in an order dated 16.8.2006 while rejecting the appellant's offer of plaint property as security pursuant to appellate court's order granting stay of the proceeding in this appeal.

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On the other hand, the learned counsel for the respondent took me to the evidence on record and sought to sustain the findings contending that the nature of pleadings as to defence set up in the

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written statement as well as the nature of contentions raised in Ext.B1 reply notice only supported the respondent's case that Ext.A1 was

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R.F.A.No.237 of 2006 & CO 74/2006

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accepted and signed by the appellant as agreement

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for sale and he was bound by it.

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The two material questions that need to be

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considered in the appeal are:

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(i) Whether execution of Ext.A1 was proved and it was supported by consideration?

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(ii) Whether the appellant committed breach of contract so as to entitle the respondent for refund of advance amount charged on the property?

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It is true that the respondent being a

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person seeking decree for refund has to shoulder the burden of proving that Ext.A1 is an agreement for sale executed by the appellant after being aware of the true transaction. Mere admission of signature in a blank document by itself is no proof of execution against the executant. The plaintiff

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in the suit has to prove that the signature was subscribed after the signatory being aware of the

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R.F.A.No.237 of 2006 & CO 74/2006

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contents. But it however does not mean that the

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signatory has no role at all in the suit after denying execution and can sit as a silence spectator watching the suitor as to how he was proceeding against him in discharge of burden of proof. Though an act of putting signature in a blank document may not equal to acknowledging execution of the document, there is a rebuttable presumption against the signatory that he subscribed his signature after understanding the contents of the document in the ordinary course of the nature. To this extent, the burden of proof on the plaintiff is not as higher as in the case of the defendant denying the very signature itself.

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The appellant is, therefore, bound to

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explain and show the circumstances in which he

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happened to affix signatures in the alleged blank document. This burden of proof has to be discharged by him and the respondent has always the benefit of

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rebuttable presumption in his favour arising on

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account of appellant's admitted signatures appearing in the document alleged to be blank. This legal position was rightly understood by the court below from the decision cited before him.

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Respondent testified in the course of the trial that he had gone to the property before Ext.A1 date and after finding the land to be attractive, agreed to purchase it from the

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appellant. According to him, he took a legal

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opinion from a lawyer as to whether the purchase of undivided share of land was legal and proceeded afterwards for purchasing the share of the appellant. He, however, could not remember the survey number of the land in court nor knew the contents in Ext.A1. He convincingly said that the amount for advance payment was raised from his son

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who was running a shop. All these facts indicate

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that respondent transacted with the appellant for

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R.F.A.No.237 of 2006 & CO 74/2006

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purchase of property rather than for advancing loan. He denied that he is a money lendor or had any occasion to be involved in money lending transactions with anybody. This is not rebutted by any independent evidence.

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PW2 whom the court below believed, however appears to be an interested witness. He being inimical, as shown by answers elicited in his cross-examination, should not have been believed by the trial court and his evidence was only liable to have been rejected. He is not an attesting witness in Ext.A1. The two attesting witnesses in Ext.A1 were not summoned and examined in support of respondent's case for no good reasons. In my view, notwithstanding their non examination also, the respondent's case is satisfactorily proved by the facts and circumstances and also the nature of contention raised by the appellant in his own pleadings and in the reply notice.

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R.F.A.No.237 of 2006 & CO 74/2006

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The case pleaded by the appellant is very

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relevant in arriving at the conclusion as to the execution of Ext.A1 and the nature of the transaction evidenced by it. Ext.A1 consists of three papers each containing appellant's signature. He does not have a case that all the papers were fully blank except his own signatures. He admits that they were partially filled up and were not wholly blank. He made it clear in Ext.B1 reply notice sent to the respondent's counsel that one of the pages consisted of a printed paper with blank columns. The last page contained the description of the property. The first page, it appears from evidence, was not blank. There is a minor correction made to the Malayalam letter of house name described in the first page. This is admitted by DW1 also. The correction was initialed by both PW1 and DW1 jointly. The difference in the ink as well as in the handwriting appearing in the

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property description column of the last page is not denied by PW1.

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The appellant testified that the page

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containing printed matter was left blank in three places and they were filled up subsequently by the respondent inserting the amounts of sale consideration, the advance money and the term of contract period. Taking the nature of defence contention which was affirmed in the evidence given by DW1 into consideration, it is obviously clear that the papers signed by the appellant contained all necessary terms and stipulations constituting an agreement for sale of his undivided share held under partition deed No.840/1982. There cannot be any doubt of this, even assuming that blank portions left out were later filled up with figures of amount. He cannot successfully deny that he had adequate notice that he signed papers knowing that the document was intended to be an

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R.F.A.No.237 of 2006 & CO 74/2006

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agreement for sale rather than repayment of loan.

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The appellant is an educated man. He is a

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Science Graduate and was employed as a Senior Chemist Gwalior as he himself admitted in his oral evidence. He is a Managing partner of Cross Real Estate. The evidence brought out through cross examination further shows that he had been involved in a few criminal cases and had been in jail also.

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This evidence may not be much relevant in appreciating the issues involved in this case. He admitted that at the instance of his brother Dinesh Babu, he was being prosecuted on the charge of forging brother's signature. Nobody knows what is or was the outcome of the criminal case. I referred to these circumstances only to express my impression about the appellant that he is not a man who lived divorced from social realities or was vulnerable to fraud or forgeries. It is difficult to believe that he would have tended to sign a

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blank document under any circumstances. His only explanation for signing the blank papers is that he needed money for meeting urgent affairs and he took the respondent into confidence that the signed blank papers would not be misused. It is hard to believe the evidence given by the appellant that he executed Ext.A1 as a security for loan transaction.

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DW1's evidence that small correction in the first page of Ext.A1 was jointly initialled reveals that the first page was already filed up when he signed it. The third page containing description of appellant's share of property shows that additions as to features of land were made in a different ink and handwriting. This admission of PW1 does not affect or change the nature of Ext.A1 document in any material or substantial manner. Even ignoring the additions made to the schedule of property also, the subject mater of agreement would remain the same without any material change. The addition

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is in no way to be taken as forgery except that it

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was meant for a clarification. The contents in the printed paper are unambiguous enough to show that it contained all requisite conditions and stipulations essential for an agreement for sale.

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The testimony of DW1 is not satisfactory

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and convincing enough to establish that the blank

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columns in the printed paper were subsequently filled up by the respondent. PW1 denied the allegations made against him. Being an educated man with sufficient social experience in life, the normal presumption that applies against him is that he signed the document after knowing the contents fully well. This presumption has not been rebutted either by circumstances or probabilities in the case.

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The learned counsel for the appellant

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rightly contended that nothing precludes a party to a document from showing that his intention was

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different from what appears in the document and bar under Section 92 of the Evidence Act will not apply against him as held in Gangabai v. Chhabubai (1982 KHC 228) . But there is no convincing evidence forthcoming to support the appellant's case that his intention was to sign an agreement for repayment of loan. His assertion that he did not intend to execute the agreement for sale is without

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any bona fides and is not corroborated any circumstances to probabilise his case.

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On reappreciation of evidence and legal principles bearing on facts of the case, I am satisfied that the finding of the court below that appellant signed Ext.A1 document accepting it as agreement for sale of undivided share is legal and proper. There is no legitimate reason to interfere with the said finding.

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The respondent has substantiated that

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though he was willing to execute the sale deed, it

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was foiled because appellant did not handover the

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title deed or get encumbrance certificate of the property to him. Thus breach of terms of contract is satisfactorily proved by respondent's evidence. He therefore rightly revoked the terms of the contract as contended in the plaint and suit notice. The appellant did not have a case that he was ready and willing to perform his part of the contract. The breach of contract being contributed by him, the respondent rightfully sought refund of the advance amount charged on the plaint property. The court below justifiably upheld the claim of the respondent which in my opinion, does not call for any interference. Thus agreeing with the view taken by the court below, I hold that appellant failed to prove his contentions in denial of his liability.

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As regards the Cross Objection filed by the respondent, I am of the opinion that the court below rightly exercised the discretion of directing

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parties to bear costs.

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In the result, the appeal and the Cross

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Objection fail and they are dismissed.

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All pending interlocutory applications are

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closed.

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T.V.ANILKUMAR JUDGE

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ami/

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Contd...

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R.F.A.No.237 of 2006 & CO 74/2006

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The order dated 06/09/2021 in RP 577/2021

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in RFA 237/2006 “The future interest granted at the

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rate of 9% to the sum adjudged in a suit for recovery of advance amount was sought to be reviewed on the ground that it violates the mandate under Section 34(1) of Code of Civil Procedure. In support of their argument, the order of the Apex Court in Special Leave application brought to the notice of this Court. The future interest (from the date of decree till the realisation) payable shall not exceed 6% per annum unless the transaction is of commercial nature. Reliance was also placed on a Division Bench decision of this Court in Sujeth P.S. and another v. C.S.Ramesh (2020 KHC 2363). Hence review is allowed modifying the rate of

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future interest (from the date of suit till the date of realisation) to the sum adjudged in the impugned decree and judgment. A fresh decree shall be drawn modifying the interest at 6% per annum to

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the sum adjudged from the date of decree till realisation. Review hence, allowed accordingly” is incorporated as part of the judgment dated 23/10/2020 in RFA 237/2006.

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Sd/- JOINT REGISTRAR

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Contd....

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R.F.A.No.237 of 2006 & CO 74/2006

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The order dated 19/07/2022 in RP 577/2021 in RFA 237/2006 “A fresh decree shall be drawn modifying the interest at 6% per annum to the sum adjudged from the date of suit till its realisation. Review hence, allowed accordingly” is incorporated as part of the judgment dated 23/10/2020 in RFA 237/2006.

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Sd/- JOINT REGISTRAR

K.M.Suresh Babu v. Chalil Kunhikrishna Kurup

Case brief

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What did the court decide?

K.M.Suresh Babu v. Chalil Kunhikrishna Kurup

Case brief

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