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IN THE HIGH COURT OF JUDICATURE AT MADRAS
RESERVED ON: 07.11.2016
PRONOUNCED ON:
CORAM :
THE HONOURABLE MR.JUSTICE T.RAVINDRAN
S.A.No.280 of 2011
&
MP.No.1 of 2011
Thirugnanasambandam ... Appellant
Vs.
Venkatraman Pillai ... Respondent
Prayer:- This Memorandum of Second Appeal is filed under Section
100 of Civil Procedure Code against the Judgment and decree dated
23.07.2010 passed in A.S.No.69 of 2009 on the file of Subordinate
Judge, Mannargudi reversing the judgment and decree dated
24.07.2009 passed in O.S.No.29 of 2007 on the file of District
Munsif Court, Thiruthuraipoondi.
For Appellant : Mr.A.Muthukumar
For Respondent : Mr.S.Nagaraj
JUDGMENT
Challenge in this Second appeal is made by the defendant
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against the judgment and decree dated 23.07.2010 passed in
A.S.No.69 of 2009 on the file of Subordinate Judge, Mannargudi
reversing the judgment and decree dated 24.07.2009 passed in
O.S.No.29 of 2007 on the file of District Munsif Court,
Thiruthuraipoondi.
2.Suit for recovery of money.
3.The case of the plaintiff in brief is as follows:
The defendant had agreed to convey the suit properties to the
plaintiff for a sum of Rs.1,28,250/- and the plaintiff also having
giving consent to the same, the plaintiff and the defendant entered
into a Sale Agreement on 10.01.2002 evidencing the above said
transaction and pursuant to the same, the plaintiff advanced a sum
of Rs.80,000/- to the defendant towards a part of the sale
consideration and the time for completing the sale agreement is two
years. The defendant entrusted the title deeds of his properties to
the plaintiff. However, despite several requests by the plaintiff, the
defendant had on some pretext or the other delaying the completion
of the execution of the sale deed. The plaintiff was ready to entrust
the title deeds to the defendant while so the defendant on the
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ground that the title deeds in respect of one property is required for
taking survey measurement, obtained the same from the plaintiff
and despite the request of the plaintiff to hand over the same, the
defendant did not respond properly and therefore, raising suspicion
on the conduct of the defendant, the plaintiff issued a legal notice
to the defendant claiming the specific performance of the Sale
Agreement on 12.06.2006 and on the receipt of the said notice, the
defendant sent the reply containing false allegations. The plaintiff
also learnt that the defendant has alienated the property comprised
in S.No.429/16, the above conduct of the defendant amounts to
breach of contract. Hence, the plaintiff is not willing to purchase the
suit properties pursuant to the sale agreement and the plaintiff has
therefore come forward with the present suit seeking for the refund
of the advance amount paid by him to the defendant with a relief of
creating charge for the same over the suit properties.
4.The case of the defendant in brief is as follows:
The suit is not maintainable either in law or on facts. It is
false to state that the defendant and the plaintiff entered into a Sale
Agreement on 10.01.2002, whereby the defendant agreed to
convey the suit properties to the plaintiff for a sum of Rs.1,28,250/-
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and that the plaintiff had advanced a sum of Rs.80,000/- to the
defendant. The defendant did not receive any amount from the
plaintiff as part of the sale consideration and did not execute any
sale agreement in favour of the plaintiff and it is also false to state
that the parties have agreed to complete the sale transaction within
two years from the date of the sale agreement and that the
defendant entrusted his title deeds to the plaintiff. To the notice
sent by the plaintiff on 12.06.2006, the defendant sent a suitable
reply on 16.06.2006 and in the reply notice he has given the true
facts. The defendant had sold his land to one Arumugam Chithiran
and out of the sale consideration he has discharged the debt
incurred by him from the plaintiff and settled the account with the
plaintiff and despite the request of the defendant to the plaintiff to
hand over the title deeds, the plaintiff insisted that the defendant
still owed money to him in respect of the earlier transactions and
directed the defendant to take back the title deeds after the
discharge of the same and accordingly the defendant by selling his
Power Tiller, paid a sum of Rs.28,000/- to the plaintiff on
26.06.2004 and further paid Rs.5000/- on 27.02.2006 and settled
the account. Even there after, the plaintiff did not hand over the
title deeds to the defendant on the pretext that they are in the
custody of his wife and that she is not in station and subsequently,
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despite the requests of the defendant, the plaintiff did not hand over
the title deeds and on the other hand sent a false notice dated
12.06.2006 to which, the defendant sent a suitable reply containing
the true events. Therefore in as much as the defendant had paid
the debt incurred by him from the plaintiff, the case of the plaintiff
that the sale agreement has been entered into between the parties
in respect of the sale of the suit properties of the defendant is
unsustainable. It is the usual practice of the plaintiff to obtain the
sale agreement, when ever loans are sought for from him and
accordingly the defendant also used to execute the sale agreement
in favour of the plaintiff and after the discharge of the debt, used to
get back the sale agreements. However, on account of the enmity
at present, the plaintiff has come forward with the false suit. The
plaintiff is not entitled to any amount from the defendant and the
suit is not maintainable and hence the suit is liable to be dismissed.
5.In support of plaintiff's case PW1 has been examined.
Exs.A1 to A4 were marked. On the side of the defendant, DW1 & 2
were examined. Exs.B1 to B6 were marked. On a consideration of
the oral and documentary evidence adduced by the respective
parties, the trial Court was pleased to dismiss the suit. The plaintiff
challenged the same. The first Appeal preferred by the plaintiff was
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allowed and consequently, the suit has been decreed by the first
Appellate Court. Challenging the same, the present Second Appeal
has been instituted.
6.The Second Appeal has been admitted and the following
substantial questions of law are formulated for consideration in this
Second Appeal:
(a)When time for performance of the
contract was fixed in the Sale Agreement,
Ex.A1= Ex.B4, whether the lower Appellate
Court erred in law in holding that the time
starts for filing suit only from the date of
refusal, viz., from the date of reply notice
Ex.A4, contrary to Article 54 of the Limitation
Act, 1963?
(b)Whether Ex.A4 is bad in law in view of
the material alteration with regard to limitation?
The short point that arises for consideration in this Second
Appeal is whether the suit laid by the plaintiff for the refund of the
advance amount is barred by limitation or not?
7.The suit has been laid by the plaintiff for refund of the
advance amount tendered by him to the defendant, pursuant to the
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Sale Agreement dated 10.01.2002, which has been marked as
Ex.A1. The case of the plaintiff is that the defendant agreed to sell
the suit properties to him for a sum of Rs.1,28,250/-, accordingly,
the parties entered into the sale agreement and the plaintiff
advanced a sum of Rs.80,000/- to the defendant as part of the sale
consideration on the date of agreement and the time fixed for the
execution of the sale deed is two years and even though, the
plaintiff was ready and willing to perform his part of the contract, in
as much as the defendant has alienated a portion of the property
comprised under the sale agreement, which act of the defendant
amounts to breach of contract and as the plaintiff is not willing to
further go ahead with the sale agreement and complete the sale
transaction, according to the plaintiff, he has come forward with the
present suit seeking for the refund of the advance amount coupled
with the prayer of the charge over the suit properties till the amount
is paid by the defendant.
8.Per contra, it is denied by the defendant that the plaintiff
and the defendant entered into the sale agreement in respect of the
suit properties on 10.01.2002 for a sum of Rs.1,28,250/- and based
upon the same, the plaintiff paid a sum of Rs.80,000/- to the
defendant as advance and the time fixed for completing the same is
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two years. According to the defendant, he used to borrow the
loans often from the plaintiff and as per the practice of the plaintiff
when ever loan is tendered, the plaintiff used to get the sale
agreement from the borrowers and accordingly the defendant
himself had executed various sale agreements in favour of the
plaintiff on earlier occasions for the amounts borrowed from the
plaintiff and later on discharging the loan he used to get back the
sale agreement and thus according to the defendant in respect of
the earlier loan transaction that he had with the plaintiff for the
amount due, the plaintiff forced the defendant to execute the sale
agreement now in question marked as Ex.A1 and left with no other
alternative, the defendant had executed the sale agreement and
also entrusted the title deeds of his property to the plaintiff and
subsequently, by sale of one of his properties to one Arumuga
Chithiran, the defendant had paid a sum of Rs.20,000/- to the
plaintiff and settled the account. However, in as much as the
plaintiff insisted that further sum is still due in respect of the loan
transaction, the defendant after selling the Power Tiller, paid a sum
of Rs.28,000/- to the plaintiff on 26.06.2004 and again a sum of
Rs.5000/- on 27.02.2006 and even there after, i.e., after the
settlement of the account, the plaintiff did not hand over the title
deeds to him on the pretext they are in the custody of his wife and
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that she was not in station and even subsequently, the plaintiff did
not come forward to hand over the title deeds and on the other
hand has sent a legal notice claiming the specific performance, to
which the defendant has sent a suitable reply containing the true
facts and therefore, according to the defendant the sale agreement
projected by the plaintiff marked as Ex.A1, has been forcibly
obtained by the plaintiff from the defendant alongwith the title
deeds and thus being the position, according to the defendant, the
plaintiff is not entitled to get the relief sought for.
9.To establish his case that the plaintiff was in the habit of
obtaining the sale agreements from the defendant towards the loan
transactions, no doubt the defendant, during the course of cross
examination of the plaintiff has marked Exs.B1 to B3, Sale
Agreements and the same had also been admitted by the plaintiff
in his evidence.
10.On the basis of Exs.B1 to 3, it is contended by the learned
counsel for the defendant that similarly, Ex.A1, Sale Agreement has
also been obtained by the plaintiff from the defendant forcibly
alongwith his title deeds in respect of the earlier loan transaction
and therefore, the question of refund of the alleged advance amount
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mentioned under Ex.A1, does not arise.
11.The plaintiff in his evidence has categorically denied that
Ex.A1 has been obtained by him from the defendant in respect of
the earlier loan transaction. Even though, he has admitted Ex.B1
to 3 transactions, firmly he has denied the case of the defendant in
respect of Ex.A1, Sale Agreement. In such circumstances, the
defendant without adducing any further material to sustain his case,
cannot, on an analogy equate the case of the Sale Agreement,
Ex.A1, to the other sale agreements marked as Ex.B1 to B3.
12.Now according to the defendant, in respect of the earlier
transaction amounting to Rs.20,000/- alleged to have been
borrowed by him from the plaintiff, the plaintiff had forcibly obtained
the sale agreement in question alongwith the title deeds and since
he was depending upon the plaintiff for the loan amounts left with
no other alternative, he had executed the Sale Agreement dated
10.01.2002 marked as Ex.A1. Therefore, according to the case of
the defendant Ex.A1 was not executed by the defendant out of his
free will and consent and on the other hand, it has been forcibly
obtained from him by the plaintiff in respect of the earlier loan
transaction. If that be the usual practice of the plaintiff, he would
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have also secured the title deeds of the defendant in respect of the
transactions covered under Ex.B1 to B3. But it is not the specific
case of the defendant that even in respect of Ex.B1 to B3
transactions, the defendant had part with his title deeds to the
plaintiff and that after the discharge of the loan amount pertaining
to the same, he had received back the title deeds from the plaintiff.
Therefore, the theory now projected by the plaintiff that out of force
exerted by the plaintiff, he had executed the Sale Agreement, Ex.A1
and also parted with the title deeds in respect of his properties
cannot be accepted straightaway. If that be the case, if according to
the defendant, the plaintiff out of force and compulsion and
unlawfully had obtained the Sale Agreement, Ex.A1 from the
defendant and not stopping there also obtained the title deeds of
the properties of the defendant, as rightly argued by the learned
counsel for the plaintiff, as a prudent person, the defendant would
have taken legal redressel available to him, as per law. He would
have preferred necessary complaint against the plaintiff for his
unlawful acts or would have instituted necessary suits against the
plaintiff for necessary reliefs particularly for getting back the title
deeds of his properties as early as possible. However, the
defendant for reasons best known to him had not moved his little
finger in any manner either to rescind the Sale Agreement, Ex.A1 on
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the footing, it has been illegally obtained from him by the plaintiff or
get back the sale deeds of his properties from the plaintiff. That
apart, it has not been stated by the defendant clearly in his written
statement or in the reply notice marked as Ex.B5, that in respect of
which loan transaction he was found to be due for a sum of
Rs.20000/- to the plaintiff in respect of which the sale agreement in
question is said to have been forcibly obtained by the plaintiff from
the defendant.
13.Therefore, as per the case of the defendant, it appears
that even prior to Ex.A1 or the execution of Ex.A1, the defendant
has borrowed loans from the plaintiff. However, the defendant has
not come out with clear averments with reference to which earlier
loan transactions he had with the plaintiff, the sale agreement in
question is said to have been taken from him forcibly by the
plaintiff.
14.Be that as it may, now according to the defendant, by
selling one of his properties to one Arumugam Chittiran, he has paid
a sum of Rs.20000/- to the plaintiff and demanded the plaintiff to
return the sale deeds of his properties. However, according to the
defendant, in as much as the plaintiff insisted that further sum of
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Rs.30000/-, is still due from the defendant, according to the him,
left with no other alternative, he has sold his Power Tiller and
thereby paid a sum of Rs.28000/- to the plaintiff on 26.06.2004 and
further paid a sum of Rs.5000/- on 27.02.2006 and thereby settled
the loan transaction he had with the plaintiff.
15.The above case of the defendant is vehemently refuted by
the plaintiff. Even then, the defendant has not placed any material
to sustain the above factum of his defence theory. If according to
the defendant he had paid a sum of Rs.20000/- to the plaintiff as
alleged by him he would have obtained necessary receipt for the
same from the plaintiff. The receipt has not been produced nor any
independent witness examined evidencing the payment of the above
sum has been examined. The evidence of DW2 examined on the
side of the defendant does not improve his case. Similarly, for the
subsequent payments alleged to have been made by the defendant
to the plaintiff in a sum of Rs.28000/- on 26.06.2004 and a sum
of Rs.5000/- on 27.02.2006 also, if really such payments have
been made, the defendant would have insisted the plaintiff to give
due receipts acknowledging the payment or established the above
payments through acceptable and reliable evidence.
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16.However, baring the ipse dixit testimony of the defendant,
no other material is forthcoming to buttress the above case of the
defendant. If really the defendant had paid the entire loan amount
that he had borrowed from the plaintiff and settled the account and
if even there after the plaintiff had not returned or cancelled the
sale agreement in question or returned back the title deeds of his
properties, as a prudent person in the normal course of events, the
defendant would have taken necessary legal action against the
plaintiff. However, according to the defendant in as much as the
plaintiff has informed that the title deeds of his properties were in
the custody of his wife, as his wife was not in station, the defendant
was unable to get back the title deeds. Even assuming the above
reason to be true, nothing prevented the defendant to get back the
title deeds of his properties, subsequently from the plaintiff on the
return of the plaintiff's wife or at least get back the sale agreement
duly discharged from the plaintiff, if it had been obtained in respect
of the loan transaction as now alleged by the defendant.
17.However, according to the defendant, despite several
requests, the plaintiff has on some pretext or the other, refused to
return the title deeds and subsequently it is stated that the plaintiff
had sent a legal notice on 12.06.2006. The above theory projected
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by the defendant, cannot be accepted. In the normal course of
events, if really he had discharged the loan amount and settled the
account of the plaintiff, as done the earlier in the case of Ex.B1 to
B3, he would have received back Ex.A1, Sale Agreement also from
the plaintiff. However, giving a new theory for the failure of the
defendant to get back the sale agreement in question, according to
the defendant on account of the difference of opinion between him
and the plaintiff, the plaintiff had not returned back either the sale
agreement in question duly discharged or the title deeds of his
properties. If that be the case, what prevented the defendant from
taking suitable legal action against the plaintiff has not been
explained in any manner by the defendant. Therefore, it could be
seen that the defendant has raised the defence in the present case
without any foundation and therefore, unable to sustain the same
by adducing acceptable and reliable proof.
18.In the light of the above discussions, the theory projected
by the defendant that Ex.A1, Sale Agreement has been taken
forcibly from him by the plaintiff in respect of the earlier transaction
alongwith his title deeds cannot be believed in any manner and as
rightly argued, the above defence has been taken for the purpose of
this case to deceive the lawful rights of the plaintiff. The plaintiff's
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case is that the parties had agreed to complete the sale transaction
within two years as stipulated in the Sale Agreement, Ex.A1 and
accordingly on seeing the attitude of the defendant amounting to
breach of contract, left with no other way, it is stated that the
plaintiff issued a legal notice and there after instituted the present
suit.
19.The above case of the plaintiff that time limit stipulated in
the agreement for completing the transaction is fixed as two years
is challenged and on the other hand, as per the defendant's case,
the time limit is fixed only as one year and hence according to the
defendant, the plaintiff has caused a material alteration in the
agreement with reference to the time from 1 to 2 years and
therefore, if the time limit is fixed for the completion of the contract
is one year, the limitation for instituting the suit for the refund of
advance amount, according to the defendant, commences from
10.01.2003 and in as much as the plaintiff has not laid the suit
within three years thereafter, instead filed the suit on 15.12.2006, it
is argued that the suit is barred by limitation. It is further argued
that even assuming for the sake of arguments that Ex.A1 has been
taken only as sale agreement in respect of the purchase of the
properties, even then according to the defendant, in as much as one
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year period is fixed in the sale agreement, as per Article 54 of the
Limitation Act, the plaintiff should have file the suit within three
years from the date fixed for the performance.
20.In this case, in as much as the plaintiff has failed to file the
suit on or before 10.01.2006 and on the other hand instituted the
suit only on 15.12.2006, according to the learned counsel for the
defendant, the suit is clearly hit by limitation.
21.The first Appellate Court invoking the second part of Article
54 of the Limitation Act computed the period of limitation from the
refusal of the performance of the contract and accordingly, held that
the suit is not barred by limitation. On the same line, the learned
counsel for the plaintiff also placed his submissions in the Second
Appeal. Further according to the learned counsel for the plaintiff,
time is not the essence of the contract in respect of the immovable
properties and for explaining that proposition of law, he relied on
the authority reported in 2010 (3) CLT 560(S.Sambandam Vs.
C.Pushparani).
22.To establish that the plaintiff had altered the period in
Ex.A1, Sale Agreement, the defendant has produced the copy of
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the sale agreement given to him at the time of execution of Ex.A1,
which has been marked as Ex.B4 and according to the defendant,
the time limit in Ex.B4 is stated to be only one year and therefore,
based upon Ex.B4, the Court should held that invoking the first part
of Article 54 of the Limitation Act, the suit is time barred. However,
the plaintiff has denied the truth and validity of Ex.B4, it is stated
that the same had been created by the defendant for the purpose of
this case. If according to the defendant, Ex.A1 itself has been
forcibly obtained from him by the plaintiff alongwith the title deeds
in respect of the earlier loan transactions, it is farfetched to
contend that even at that point of time, the parties had taken a
copy of the sale agreement in the nature of Ex.B4 and the same
had been handed over to the defendant by the plaintiff. Therefore,
the production of Ex.B4 also would belie the theory projected by the
defendant that Ex.A1, Sale Agreement has been forcibly secured
from him by the plaintiff in respect of the earlier loan transaction.
23.It is argued by the learned counsel for the defendant that
the plaintiff has failed to examine the attestor of the sale agreement
to establish that the time limit fixed in the sale agreement is only
two years and not one year as mentioned in Ex.B4. According to
the plaintiff, in as much as the attestor is related to the defendant,
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he was unable to examine the attestor. To the same, it is contended
by the defendant that in such circumstances also the duty is cast
upon the plaintiff to examine the attestor and in the event of the
attestor not supporting the plaintiff's case, the plaintiff would be
entitled to treat him as an hostile witness and cross examine him
with reference to his case.
24.Be that as it may, it is found that the theory projected by
the defendant that Ex.A1, Sale Agreement was taken forcibly by
the plaintiff in respect of the loan transaction has not been
established by the defendant. No doubt, on the face of it, the
period is found to be altered in Ex.A1. However, to establish his
case, nothing prevented the defendant from examining the attestor.
It is not the case of the defendant that the attestor is not his
relative or known to him. Therefore, if really the period fixed and
agreed to be fixed is only one year, nothing prevented the
defendant from examining the attestor to elicit the truth. No doubt
it is the duty of the plaintiff to establish the Sale Agreement Ex.A1,
in complete particularly, even with reference to the period
mentioned in the agreement when the same has been disputed.
25.Be that as it may, since the Second Appeal is confined
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mainly on the question of limitation, in my considered opinion,
its immaterial whether the period mentioned in the sale agreement
in question is one year or two years as it is found that as regards
the refund of advance amount by the agreement holder, the
relevant article for the same would not be Article 54 of the
Limitation Act and on the other hand the relevant Article would be
only Arcicle 62 of the Limitation Act.
26.Insofar as this case is concerned, it is found that the
defendant has failed to establish that Ex.A1, Sale Agreement is
forcibly obtained by the plaintiff in respect of the earlier loan
transaction. It is therefore clear that the sale agreement in
question was only pursuant to the agreement entered into between
the parties towards the sale of the suit properties. However, instead
of seeking the main relief of specific performance, the plaintiff has
chosen to lay the suit only for the refund of advance amount based
upon the sale agreement. In such circumstances, whether the
period mentioned in the sale agreement is one year or two years,
when it is found that only Article 62 of the Limitation Act would
apply in such case, it could be seen that the suit instituted by the
plaintiff on 15.12.2006 is not hit by the law of Limitation.
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27.In this connection, it is found that the Hon'ble Apex Court
in the decision reported in 2004 (2) L.W 871(Videocon
Properties Ltd., Vs. Dr. Bhalchandra Laboratories & Others)
has held that the buyer under an agreement for sale of an
immovable property was entitled to a charge on the property as
against the seller to the extent of the seller's interest in the
property for the amount of any purchase money paid and for the
interest on such amount and that as per section 55(6)(b) of the
Transfer of Property Act, 1882, the buyer under the agreement for
sale was entitled to a charge even against the third party purchaser.
Further, in the decision reported in 2000(1) CTC 507(Delhi
Development Authority Vs. Skipper Construction Co.(P)Ltd.,
and Others), the Hon'ble Apex Court has held that the charge of
the purchaser under Section 55(6)(b) of the Transfer of Property
Act, 1882, would continue to run even after the conversion of the
property into some other property. In addition, in the said case, the
Hon'ble Supreme Court held that the period of limitation for
enforcement of refund of purchase money paid on the sale
agreement with regard to the immovable property plus interest
thereon shall be 12 years from the date when the money becomes
due.
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Article 62 of the Limitation Act, 1963(which corresponds to
Article 132 of the Limitation Act, 1908) provides a period of 12
years ''to enforce payment of money secured by a mortgage or
otherwise charged upon immovable property''. Time runs from the
date ''when money became due''.
28.Following the above decisions of the Hon'ble Supreme
Court of India, our High Court in the decision reported in 2013 (5)
LW 253(K.Shanmugam & Another Vs. C.Samiappan & Others)
has held that the limitation for refund of advance money with
interest under an agreement for sale of immovable property is
governed by Article 62 of the Limitation Act as the buyer has got a
statutory charge over the property to the extent of interest of the
seller and that hence the period of limitation shall be 12 years from
the date on which the right to sue for the refund of advance amount
accrues. In the above decision also our High Court has found that
the lower Court has committed an error in invoking Article 54 of the
Limitation Act, while deciding the question of limitation for such type
of suit by holding the same as three years from the date of accrual
of right to sue.
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29.Following the above said decisions, it could be seen that
the argument of the learned counsel for the defendant that the suit
is barred by limitation on the footing that the time limit fixed in the
sale agreement is only one year cannot be accepted in any manner.
As adverted to earlier, whether the time limit fixed in the Sale
Agreement, Ex.A1, is either one year or two years as the case may
be, it could be seen that when the relevant article that would govern
the issue is Article 62 of the Limitation Act, the plaintiff will be
having 12 years period to institute the suit and accordingly, it is
seen that the suit filed by the plaintiff on 15.12.2006 is well within
the time and not hit by the law of limitation.
30.In the light of the above discussions, the substantial
questions of law formulated in this second appeal are answered in
favour of the plaintiff and against the defendant. Consequently, the
second appeal fails and is dismissed. No costs. Consequently,
connected miscellaneous petition is closed.
.12.2016
Index: Yes/No
Internet:Yes/No
dn
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To
1.The Subordinate Judge,
Mannargudi.
2.The District Munsif Court,
Thiruthuraipoondi.
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T.RAVINDRAN.J.,
Dn
S.A.No.280 of 2011
.12.2016
