R.Radhakrishna Prasad vs Swaminathan

2024 INSC 463 REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 910 OF 2024

R. RADHAKRISHNA PRASAD …. APPELLANT

VERSUS

SWAMINATHAN & ANR. ...RESPONDENTS

JUDGMENT

PRASHANT KUMAR MISHRA, J.

This appeal would call in question the Judgment and

decree of the High Court of Kerala by which the High Court has

allowed the appeal preferred by the defendant no. 1 and

modified the decree passed by the Trial Court whereby, in a

suit for specific performance, the Trial Court had directed the Signature Not Verified

defendant no. 1 to refund a sum of Rs. 18,00,000/- (Rs. Digitally signed by VARSHA MENDIRATTA Date: 2024.07.08 15:22:48 IST Reason:

Eighteen Lakhs only) to the plaintiff. Under the impugned 2

Judgment, the High Court has allowed the plaintiff to recover

only a sum of Rs. 3,00,000/- (Rs. Three Lakhs only) with 12%

interest per annum from the date of suit till realisation from

the defendant no. 1.

2. Briefly stated, the facts of the case are that the

appellant/plaintiff preferred a suit for specific performance of

the agreement dated 26.03.1998 whereunder the parties

entered into an agreement for sale of the suit property over

which the defendant no. 1 had a right by virtue of Partition

Deed no. 2304/81 and Sale Deed nos. 759/93 & 1586/93 of

the S.R.O. Chengannur. The defendant no. 1 agreed to sell

the said property to the plaintiff for a sale consideration of Rs.

30,00,000/- (Thirty Lakhs only) and to handover the vacant

possession of the suit property to the plaintiff within 06

months from the date of agreement. He received an advance

sale consideration of Rs. 3,00,000/- (Three Lakhs only) from

the plaintiff and also handed over the title deeds and

encumbrance certificate to the plaintiff. The defendant no. 1

had availed of a loan from the defendant no. 2 - Bank by way

of creating an equitable mortgage on deposit of his title deeds. 3

Therefore, to clear the said liabilities, the defendant no. 1

received an additional amount of Rs. 15,00,000/- (Fifteen

Lakhs only) from the plaintiff between the period from

26.03.1998 and 12.09.1998 and extended the period of the

agreement for one year from 12.09.1998. The plaintiff

averred in the suit that he was always ready and willing to pay

the balance sale consideration as per the agreement but due

to the laches on the part of the defendant no. 1, the sale deed

could not be executed in time. In spite of repeated requests,

the defendant no. 1 did not execute the sale deed, therefore,

the suit was preferred. The plaintiff claimed for specific

performance of the agreement and in the alternative prayed

for refund of the advance sale consideration of Rs.

18,00,000/- (Eighteen Lakhs only), mesne profits etc.

together with interest and other incidental expenses. No relief

was sought from the defendant no. 2.

3. The defendant no. 1 contested the suit by denying the

whole transaction. He denied having any acquaintance with

the plaintiff as also the execution of the agreement. He also

stated that he is only a co-owner of the suit property which 4

would fetch value of more than Rs. 1,00,00,000/- (One Crore

only). Thus, according to the defendant no. 1, the plaintiff has

raised a false claim on the basis of a non-existing agreement.

It is also stated in the written statement that there were

financial transactions between one K.K. Vijayadharan Pillai and

defendant no. 1 during which the said K.K. Vijayadharan Pillai

obtained his signatures on blank papers and cheques from him

and his wife. He has also initiated criminal prosecutions and

instituted civil suit against defendant no. 1. The present suit is

one of such instances. Thus, he denied any privity of contract

between himself and the plaintiff. The suit has been instituted

under the influence of K.K Vijayadharan Pillai on the strength

of some forged and fabricated documents. The defendant no.

2 - Bank did not appear despite receiving summons and was

thus proceeded exparte.

4. Before the Trial Court, the plaintiff examined three

witnesses and exhibited documents A1 to A8 whereas, on his

side, defendant no. 1 examined two witnesses and exhibited

two documents B1 and B2.

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5. Basing on the undisputed facts that the agreement bears

the signatures of defendant no. 1, the Trial Court found that

the agreement was executed by the defendant no. 1 and the

two witnesses of the agreement namely, K.K. Vijayadharan

Pillai (PW-2) and Jose P. George (PW-3) having supported the

plaintiff’s case, the agreement is not forged or fabricated. The

Trial Court also considered the documentary evidence as

contained in exhibit A-1 to A-8 to conclude that the suit notice

was duly served on the defendant no. 1 and that he was ready

with the sale consideration amount for the execution of the

sale deed as reflected in the document exhibit A-7. Therefore,

the plaintiff is entitled to a decree for specific performance.

This finding was also found supported by the evidence of PW-2

who was examined as a witness to the agreement and the

endorsement exhibit A-1(a) and has proved that the

documents were exhibited in his presence and the defendant

no. 1 had put his signatures on the documents. Similar is the

case with the other witness PW-3 – Jose P. George. The Trial

Court also considered the evidence of DW-1, a practicing

advocate who issued exhibit B-2 notice on the defendant no. 6

1. However, this witness has been disbelieved by the Trial

Court. The defendant no. 1 examined himself as DW-2 who

admitted his ownership in the suit property. He maintained

his stand that K.K. Vijayadharan Pillai had obtained his

signatures on blank papers and blank cheque leaves and the

same has been misused to create forged agreement.

However, the Trial Court upon consideration of the equitable

principles on which a decree for specific performance is

granted, was convinced with the case of defendant no. 1 that

the suit property would fetch more value than the sale

consideration mentioned in the agreement, therefore,

considering the principles under Section 20 of the Specific

Relief Act, 1963, the Trial Court denied specific performance

and, in the alternative, directed the defendant no. 1 to repay

the advance sale consideration of Rs. 18,00,000/- (Eighteen

Lakhs only) together with interest at the rate of 12% per

annum to the plaintiff.

6. Feeling aggrieved by the decree for refund of money

passed by the Trial Court, the defendant no. 1 preferred R.F.A.

No. 25 of 2010 in the High Court, and the another Ex. F.A. No. 7

6 of 2011 was preferred by a claimant who had set up a claim

over the property of the defendant no. 1, which had been

brought to sell in execution to satisfy the decree passed by the

Trial Court. The claimant was the advocate who appeared for

the defendant no. 1 in the execution proceedings, and his

claim was dismissed. Aggrieved thereby, he preferred the said

appeal i.e. Ex. F.A. 6 of 2011.

7. Under the impugned judgement of the High Court, the

appeal preferred by the defendant no. 1 has been allowed in

part, modifying the decree and allowing the plaintiff to recover

only a sum of Rs. 3,00,000/- (Three Lakhs only) with 12%

interest per annum from the date of suit till realisation from

the defendant no. 1 and at the same time rejecting the claim

petition of the claimant who was the appellant in Ex. F.A. No. 6

of 2011.

8. In this Civil Appeal, we are concerned with the appeal

preferred by the plaintiff who alone has approached this Court.

The claimant in Ex. F.A. No. 6 of 2011 is not before us,

therefore, the said part of the judgment has attained finality. 8

9. It is also to notice that in so far as the declining of the

specific relief of the agreement of sale, there is no further

challenge from the plaintiff by preferring First Appeal before

the High Court. Therefore, the same has become final and we

are only concerned with the refund part of the relief allowed in

favour of the plaintiff by the Trial Court and modified by the

High Court.

10. We have heard the learned counsel for the parties and

perused the material papers available on record of the Civil

Appeal as also the copy of the agreement which was made

part of the record in course of hearing.

11. Since the defendant no. 1 has not preferred any appeal

before this Court challenging the findings of the First Appellate

Court that the execution of the agreement is proved, we are

not considering the said issue. The material issue to be

decided in this appeal is whether the plaintiff has proved

payment of Rs. 3,00,000/- (Three Lakhs only) initially and

another sum of Rs. 15,00,000/- (Fifteen Lakhs only) totalling

to Rs. 18,00,000/- (Eighteen Lakhs only) to the defendant no. 9

1. Both the Courts below have found that payment of Rs.

3,00,000/- (Three Lakhs only) on the date of agreement has

been duly proved in the evidence of PW-1 and PW-3. The

bone of contention between the parties is the payment of

additional advance consideration of Rs. 15,00,000/- (Fifteen

Lakhs only) as evidenced by exhibit A-1(a) endorsement. On

this aspect, the only evidence is that of the plaintiff himself

without any corroboration from any other witness. The High

Court has noted that PW-1 would state that stamp receipts

had been collected whenever such subsequent payment were

made but none of the stamp receipts were produced. We have

perused the xerox copy of the document which was made

available to us at the time of hearing. The document would

show that the witness PW-2 had signed just below that

endorsement and only thereafter, the signature of the

defendant no. 1 is seen subscribed. Ordinarily, in any

agreement witnessing payment of money, the party signs first

and the witness(s) puts his signature(s) below that

endorsement. However, in the case in hand, the witness has

signed just below that endorsement and only thereafter, the 10

defendant no. 1 is seen subscribing to the endorsement. In

the suit notice exhibit B-1 also, there is no mention of

payment of a definite sum paid as advance sale consideration

nor existence of any endorsement has been mentioned

therein. The amount of Rs. 15,00,000/- (Fifteen Lakhs only)

so received subsequent to exhibit A-1 agreement of sale, as

stated in the second notice and also in the plaint and so

reflected in exhibit A-1(a) endorsement is not stated in exhibit

B-1 suit notice. There is no reason why payment of such

substantial amount of Rs. 15,00,000/- (Fifteen Lakhs only)

would be missing in the suit notice. The only possible reason

for this could be that the advocate who prepared the notice

was not apprised of this fact. If such was the case, plaintiff’s

statement in Court, without any further corroboration, is not

believable and the High Court has rightly found that the case

of the plaintiff as to the subsequent payment of Rs.

15,00,000/- (Fifteen Lakhs only) is not established by positive

evidence.

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12. We have considered the entire evidence to examine the

correctness of the findings recorded by the High Court and we

fail to persuade ourselves to reach to any other conclusion

than the one reached by the High Court holding that the

plaintiff has proved payment of advance sale consideration of

Rs. 3,00,000/- (Three Lakhs only) at the time of execution of

the agreement.

13. In view of the foregoing, we find no substance in this

appeal which deserves to be and is hereby dismissed.

14. The parties shall bear their own costs.

…………………………………….. J.

(VIKRAM NATH)

.......………………………………. J.

(PRASHANT KUMAR MISHRA)

NEW DELHI;

July 08, 2024.