This appeal was dismissed. The High Court held that the agreement was for loan security, not a sale, based on admissions. A new cause of action prevented entertaining a refund claim. The trial decree for Rs.1 lakh remains, with respondents claiming satisfaction.
None granted. Appeal dismissed. Costs not allowed.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
AS.No.7 of 2016
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 19.01.2023
CORAM:
THE HONOURABLE MR.JUSTICE S.S.SUNDAR
AND
THE HONOURABLE MR.JUSTICE A.A.NAKKIRAN
AS.No.7 of 2016
Mohammed Ghouse
Appellant
Vs
Prayer:- This Appeal Suit has been filed, under Section 96 of CPC, against the judgement and decree, dated, 24.07.2015, made in OS.No.3 of 2011, by the II Additional District Court, Chidambaram.
For Appellant : Mr.R.Gururaj For Respondents : Mr.A.Muthukumar
JUDGEMENT
(Judgement of the Court was made by S.S.SUNDAR, J.)
AS.No.7 of 2016
3.
AS.No.7 of 2016
Defendants. It is further stated that the Plaintiff took the signature of the Defendants on 04.04.2008 under the pretext of being a security. The Plaintiff told the Defendant that sale proceeds, which would be realised, under the Power would be adjusted towards the loan amount. It is admitted that the Plaintiff paid a sum of Rs.17,00,000/- to Senthil Finance towards discharge of the loan advanced to the Defendants by the said private Financier. However, it is the specific case of the Defendants that the Plaintiff, on the strength of the Power of Attorney deed, have executed five sale deeds for a total consideration of Rs.11,50,000/- and later received a sum of Rs.7,00,000/- in favour of the Plaintiff's wife, as she was the one who paid by way of a cheque to Senthil Finance. It was the further case of the Defendants that the Plaintiff sold three more plots invoking the Power of Attorney deed and that the actual sale consideration was more than that was stated in the document. It was contended by the Defendants that the amount that was paid by the Plaintiff was already settled and that therefore, the suit for specific performance cannot be sustained.
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the evidence that he has sold eight plots on the basis of the Power of Attorney deed and that the amount originally paid by the Plaintiff was not as part of the sale consideration, the suit for alternative prayer for recovery of the money was also rejected. However, the Trial Court decreed the suit for a sum of Rs.1,00,000/- based on the admission of the Defendants. Aggrieved by the judgement and decree of the Trial Court, dated 24.07.2015, the above appeal is filed by the Plaintiff.
AS.No.7 of 2016
04.04.2008. The Trial Court has categorically found that the agreement is not a bona fide sale transaction, but it was executed at the instance of the Plaintiff as a security for the loan transaction. That being so, the Plaintiff's alternative prayer for recovery of a sum of Rs.17,00,000/- based on the agreement is not sustainable, when it is proved that the payment that was made by the Plaintiff on behalf of the Defendants was on the basis of different transaction. In the course of evidence, the Plaintiff has admitted the sale of eight plots on the strength of the Power of Attorney deed executed by the Defendants in favour of the Plaintiff. It is admitted that by Ex.B1 sale agreement for a sum of Rs.18 lakhs was executed as a security for loan transaction and the said agreement was cancelled under Ex.B2 dated 04.01.2009. Ex.A1 is prior to Ex.B1 and hence, it is not a bona fide sale agreement. When the Plaintiff admitted appropriation of sale proceeds out of sale deeds as Power of Attorney of the Defendants and obtained multiple sale agreements in respect of same properties, the Trial Court is perfectly right in holding that the payments admitted by the Defendants are not paid towards sale consideration for suit agreement, but as promised by the Plaintiff to discharge the loan. When the Plaintiff admitted receipt of substantial amount by selling plots of the Defendants on the basis of Power of Attorney Agent and it is stated that the Plaintiff having received more money than what was paid by the Plaintiff to discharge the mortgage, the suit for refund of money as if the payments were made under the suit agreement is not maintainable. Having regard to the fact that the Plaintiff has come
AS.No.7 of 2016
forward with a new cause of action, which is entirely different from his plea in the plaint, this Court is unable to entertain this appeal. The Trial Court, while categorically dismissing the suit for specific performance, granted a money decree for a sum of Rs.1,00,000/-, creating a charge over the property. The learned counsel for the Respondents submitted that the amount, as per the decree, has already been deposited by the Respondents. It is seen that a sum of Rs.2,26,707/- is deposited by the Defendants towards the satisfaction of the decree. Since the question as to whether the amount allegedly deposited by the Defendants would satisfy the decree, is not an issue before this Court, this Court is not inclined to express any opinion on the satisfaction of the decree as such. However, having regard to the findings of the Trial Court and the admitted facts, this Court is of the view that this Court finds no other valid grounds to sustain this appeal.
(S.S.S.R.J.) & (A.A.N..J.) 19.01.2023 Index:Yes/No Web:Yes/No Speaking/Non Speaking Srcm
AS.No.7 of 2016
S.S.SUNDAR, J. and A.A.NAKKIRAN, J.
Srcm
To
S.No.7 of 2016
19.01.2023
3 issues framed by the court
Whether the agreement dated 04.04.2008 was a bona fide sale transaction or a security for a loan.
Whether the alternative prayer for recovery of money is maintainable given that payments were made under a different transaction.
Whether the appeal is maintainable when it raises a new cause of action different from the plea in the plaint.
Mohammed Ghouse
S.S.SUNDAR
A.A.NAKKIRAN
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
