Bangalore District Court
Sri.Basantkumar Patil vs Smt.Rajithamma on 27 June, 2015
Govt. of Karnataka
C.R.P 67
Form No.9 (Civil)
Title Sheet for
Judgment in Suits
(R.P.91)
TITLE SHEET FOR JUDGEMENTS IN SUITS.
IN THE COURT OF THE XXVI ADDL. CITY CIVIL JUDGE
AT MAYOHALL BANGALORE.
(CCH-20)
Present:
Sri. Mallareppa Veerappa Jadar, B.Sc., LL.B., (Spl.)
XXVI Addl. City Civil and Sessions Judge
Dated this the 27th day of June, 2015.
O.S.No.27225/2011
Plaintiff: SRI.BASANTKUMAR PATIL,
S/o. T.K.Patil,
Aged 64 years,
Basant Group of companies,
No.176, Gandhinagar,
Bengaluru-560 009
(By Sri.H.R.Ananthakrishnamurthy and Associates )
.Vs.
Defendants : 1. SMT.RAJITHAMMA,
W/o Sri.L.Gopalakrishna
Hindu, Aged about 62 years,
2. SRI.UMA SHANKAR @ GOKUL RAJ,
S/o. Sri.L.Gopalakrishna,
Hindu, Aged about 44 years,
2 OS No.27225/2011
3. SRI.G.K.SURESH,
S/o.Sri.L.Gopalakrishna,
Hindu, Aged about 42 years,
4. SRI.G.K.RAMESH @ BALARAM,
S/o.Sri.L.Gopalakrishna
Hindu, Aged about 38 years,
All residing at:
No.9, Kempanna Lane,
Gokul Complex, 1st Floor,
Nagarathpet,
Bangalore-560 002.
(Defendant Nos.1 and 3: Advocate by Sri.N.Krishna Murthy)
(Defendant No.2. Advocate by Sri.R.B.Anand)
Defendant No.4: Advocate by Sri.M.N.Srikanth)
Date of Institution of suit: 14.12.2011
Nature of the Suit (Suit Money suit
for Pronote, Suit for
Declaration and
Possession, Suit for
Injunction, etc.):
Date of Commencement 4.1.2014
of recording of evidence:
Date on which the 27.06.2015
Judgment was
pronounced:
Total Duration:
Years Months Days
03 06 13
( MALLAREPPA VEERAPPA JADAR)
XXVI Addl. City Civil and Sessions Judge
Mayo Hall, Bangalore.
3 OS No.27225/2011
JUDGMENT
This suit is filed by the plaintiff against the defendants for the recovery of sum of Rs.1,00,62,653/- (one crore sixty two thousand six hundred fifty three) with interest at the rate of 2.25% per month compounded every two months from the date of suit till the date of realization and for sale of the schedule property for realization of a sum of Rs.1,00,62,653/- together with interest and to proceed to recover the balance of arrears from the estate of the deceased Gopalakrishna. For court costs and such other relief deems fit in the interest of justice and equity.
The suit schedule property is as follows:
All the piece and parcel of the Property bearing No.9, Kempanna Lane, Gokul Complex, Nagarath Pet, Bengaluru-560 002, bounded on:
East: Kempanna Galli West: G.Kishanlal North: C.R.Lakshminarayana Setty House South: S.Venkatachalapathy Setty House along with superstructures.4 OS No.27225/2011
2. The averments of the plaint in brief are that......> The plaintiff knew Sri.Gopalakrishna, father of defendants and other members of the family for over a decade. The 1st defendant is the wife of Sri.L.Gopalakrishna and others are their children.
3. The said Gopalakrishna had borrowed a sum of Rs.72 Lakhs from KSFC for the sake of his sons business, mortgaging suit schedule property. According to said Gopalakrishna, he deposited various sums, he was still due in a sum of Rs.22,94,324/- to KSFC in respect of the Amount payable by M/s.Gokul Jewellery and M/s.Gokul Silks. Since he was not able to paythe sum of Rs.22,94,324/- to KSFC, the property would have come for auctioning. Hence, he sought for financial assistance from the plaintiff and assured that the amount would be repaid within a period of 3-4 months. The agreed rate of interest is at 2.25% per month. As the original documents were with the KSFC, said Gopalakrishna has written a letter to the KSFC on 17.8.2006 to hand over all the original mortgaged papers to the plaintiff.
5 OS No.27225/2011
4. The plaintiff wrote a letter to KSFC stating that, he has taken requisite pay orders and sought for confirmation that, the entire papers should be returned to the plaintiff. The plaintiff furnished the DD in favour of the KSFC by (1) DD No.145512 for Rs. 21,51,069-00 (2) DD No.145513 for Rs. 00,57, 765-00 (3) DD No.145514 for Rs. 00,85,490-00 Totally amounting to Rs.22,94,324-00 (Rupees twenty two lakhs ninety four thousand three hundred twenty four only) drawn on Indusind Bank, M.G.Road Branch, Bangalore. As per the letter dated: 28.8.2006, the entire loan amount was paid to the KSFC on behalf of the said Gopalakrishna by the plaintiff. Along with the DD's, the sum of Rs.7,05,676/- (Rupees seven lakhs five thousand six hundred seventy six) was paid in the name of said L.Gopalakrishna vide Cheque No.972970 dated: 18.8.2006 gain drawn on Indusind Bank, M.G.Road Branch, Bangalore totally amounting to Rs.30,00,000/- [22,94,324/-+ 7,05,676/-]. (Rupees Thirty lakhs). The KSFC wrote a letter to L. Gopalakrishna stating that, the entire payment has been made by Sri.Basant Kumar Patil and all the persons interested had sought release of the collateral 6 OS No.27225/2011 security documents in favour of Sri.Basant Kumar Patil. On 29.8.2006, KSFC wrote letter to L. Gopalakrishna stating that, the documents are handed over to the plaintiff.
5. L. Gopalakrishna along with Sri.G.K.Umashankar obtained an additional loan of Rs.5 Lakhs on 22.1.2007 vide Cheque No.872329. Gopalakrishna became due in a sum of Rs.36,26,375/- (Rupees thirty six lakhs twenty six thousand three hundred seventy five) along with interest as on 11..2007. He wrote a letter to plaintiff stating that, he would pay said amount within four months, sought time upto 30.4.2007. He went on making requests by letters dated:5.5.2007, 3.9.2007, 3.1.2008 and 31.5.2008 and the amount confirmed as on that date is Rs.39,94,082/-. He wrote another letter on 3.7.2008 seeking time upto 30.09.2008. On 5.7.2008, the plaintiff wrote letter to the said Gopalakrishna that, the amount should be paid on or before 30.9.2008. The plaintiff has been addressing letter stating about the amount due. In the meantime, L. Gopalakrishna passed away. His wife [defendant No.1] wrote a letter to the plaintiff on 19.1.2009. He was informed about the confirmation by the letters dated: 31.3.2009, 30.4.2009, 7 OS No.27225/2011 8.10.2009, 25.1.2010 and 16.4.2010. Ultimately, on 31.12.2009, confirmation was made in respect of Rs.60,69,135.37. (Sixty lakhs sixty nine thousand one hundred thirty five Rupees thirty seven paise). There after the plaintiff has addressed a letter stating that, the amount due is Rs.64,81,808.02 as on 31.3.2010 which has again been confirmed by the 1st defendant. As on 30.11.2011, the sum due by the defendant is Rs.1,00,62,653-00 (Rupees one crore sixty two thousand six hundred fifty three only).
6. The original documents of the schedule property "Gokul Complex" have been deposited with the plaintiff by way of deposit of title deeds and created an equitable mortgage. The defendants are now liable to pay Rs.1,00,62,653-00 as on 30.11.2011.
7. The defendant Nos. 2, 3 and 4 used to come to the plaintiff's office to show the property documents along with some prospective buyers. The property document files used to be handed over to defendant Nos. 2, 3 and 4 in good faith thinking they would settle the plaintiff's account early. During one such visit, the said 8 OS No.27225/2011 defendants have knocked off the documents pertaining to Gokul Complex and the plaintiff was not aware of this. Once he came to know that, the Gokul Complex documents were missing, the plaintiff contacted Sri.Ramesh and his family members who gave evasive reply that, they had no information with regard to the original title deeds of the property. A thorough search was made to find out whether it was misplaced or stolen. The plaintiff came to know that, Sri.Ramesh and other had pledged the documents with some other financier. A complaint is lodged in this behalf at Upparpet Police Station on 19th August 2011.
8. The plaintiff has issued a legal notice on 12.11.2011 calling upon the defendants to pay the total amount of Rs.98,45,993/- (Rupees Ninety eight lakhs forty five thousand nine hundred and ninety three) due as on 31.10.2011 together with interest at 2.25% p.m. within seven days. The defendants did not collect the notice, inspite of the intimation of the fact that, the notices are addressed to each of the defendants.
9 OS No.27225/2011
9. With these main averments along with the other averments stated in the plaint, this suit is filed claiming for the reliefs stated above.
10. After service of suit summons, defendants appeared through their counsels. The defendant No.2 filed the written statement and the defendant No.4 filed the separate written statement. Remaining defendants have not filed their written statements.
11. The brief contents of the written statement of the defendant No.2 are that.....> The plaintiff knew Sri. Gopalakrishna, father of the defendants and other members of the family is only with the contest of money lent by the plaintiff and not otherwise.
12. The averment that, Gopalakrishna borrowed money from KSFC for the sake of his sons business mortgaging suit schedule property and was still in due of a sum of Rs.22,94,324/- to be paid to KSFC, the property would have come for auctioning hence, he sought financial assistance from the plaintiff and assured that, the amount would be repaid within a period of 3-4 months and the 10 OS No.27225/2011 agreed interest was 2.25% per month and the original documents were within the KSFC and Sri. Gopalakrishna written a letter dated: 17.8.2006 to the KSFC to hand over all the original mortgaged papers to the plaintiff is not wholly true.
13. The averment that, the plaintiff wrote a letter to KSFC and the entire loan amount was paid to the KSFC on behalf of the said Gopalakrishna by the plaintiff is true. The further averment that, Gopalakrishna along with this defendant No.2 obtained additional loan of Rs.5 Lakhs on 22.1.2007 etc., are denied as false.
14. The original documents of title of suit schedule property 'Gokul Complex' have been deposited with the plaintiff by way of deposit of title deeds and created an equitable mortgage may be true, but, the further averments that, the defendants are not liable to pay total sum of Rs.1,00,62,653/- (Rupees one crore sixty tow thousand six hundred fifty three) etc., are all absolutely false. 11 OS No.27225/2011
15. The allegation that, the defendants-2, 3 and 4 used to come to the plaintiff's office to show the property documents along with some prospective buyers and the property documents files used to be handed over to defendants-2, 3 and 4 in good faith thinking that, they would settle the plaintiff's amount early, are all false. Further allegations that, during one such visit the defendants have knocked off the documents pertaining to 'Gokul Complex' and the same was released later, is also false. Further the complaint lodged before Upparpet Police Station is apparently a false complaint. The allegation that, the defendants have evaded the notice issued by the plaintiff are all false. The defendants have suitably replied the legal notice caused by the plaintiff. Suit is not properly valued. Suit of the plaintiff is not maintainable.
16. The true facts is that, total extent of loan advance is Rs.35,00,000/- (Rupees thirty five lakhs) and for a period of 26 months a sum of Rs.25,00,000/- (Rupees twenty five lakhs) is paid as interest, that too being a settlement amount and thereby the total interest paid for 26 months is 73% of the loan amount. In fact the plaintiff is a professional money lender lending money without 12 OS No.27225/2011 any valid licence and has also financed several film producer and defendants seek for leave to reserve liberty to produce the documents at a later stage.
17. The property referred in the plaint as 'Gokul Complex' was subject matter of mortgage by deposit of title deeds with KSFC. In view of the scheme for one time settlement OTS floated and offered by KSFC, the defendants had opted to avail the benefits and the entire loan transaction with the KSFC was settled at Rs.1.50 Crores. since the defendants family was short of about Rs.22,94.324/-, the defendants father had approached the plaintiff for financial assistance to the tune of Rs.30,00,000/- and the plaintiff had agreed to advance the loan only if a security was created on 'Gokul Complex'.
18. The effective interest computed for a month by taking an average of the interest for a period of 12 months was ranging between 3% to 3.5%. The interest at the rate of 2.25% per month was collected on account and 0.75% was collected by cash and unaccounted.
13 OS No.27225/2011
19. The entire amount of principle as well as the interest due was settled amongst the plaintiff and the defendants at Rs.60,00,000/- (Rupees sixty lakhs) which was to be paid by the end of October-2010. The plaintiff had insisted for the payment of entire amount only by means of cash and accordingly the defendants had withdrawn the amounts from a Bank and had paid the entire amount by cash. Consequent upon which the original documents were handed over by the plaintiff to the Manager of M/s.Cosmos Bank indicate the closure of the said loan transactions. Defendants possess material and documents evidencing the same.
20. However, in relation to another property where plaintiff had lent certain amounts and had failed in arm-twisting defendants and other family members to par with the property called Hotel Apsara. The plaintiff revived a transaction which closed in October-2010 to allege theft of original documents and using his influence with the local police to impose terms on defendants. 14 OS No.27225/2011
21. The plaintiff has been charging meter rate of interest in excess of the interest notified under the Money Lenders Act and it is clear that, the plaintiff has charged and demanded interest at the rate of 4.5% per month. This is an exorbitant interest as defined under the provisions of Karnataka Prohibition of Charging Exorbitant Interest Act, 2004. Since, the demand and claim is in excess of 14% per annum, which is notified as maximum interest under Money Lenders Act for secured loans, plaintiff is liable for punishment under Sec.39 of Money Lenders Act and Sec.4 of the Karnataka Prohibition of Charging Exorbitant Interest Act, 2004.
22. The plaintiff had intended to knock off valuable property for paltry sum and attempted to coerce by filing criminal cases and even securing the arrest of defendants, since he had not succeeded in his pressure tactics he has now come out with a wholly unjust claim.
23. The act of plaintiff doing money lending business without licence is unenforceable and any agreement to the contrary is against public policy and unenforceable under Sec.23 of Indian Contract Act.
15 OS No.27225/2011
24. With these averments, in the written statement this defendant No.2 prays to dismiss the suit of the plaintiff as not enforceable under law with exemplary costs in the interest of justice and equity.
25. The defendant No.4 has filed separate written statement. The averments made in the written statement of this defendant No.4 are covered in the contentions raised in the written statement of defendant No.2, which are stated in detail in the above Paras. Hence, to avoid repetition, it is recorded stating that, the averments of the written statement of this defendant No.4 are the part and parcel of the contentions or plea raised in the written statement of defendant No.2. It can be seen by going through the corrections made in the written statement of defendant No.4 as in the written statement of defendant No.4. In the beginning two lines corrections are made by over-writing the word defendant No.2 and written as written statement of defendant No.4. The sentence prior to over-writing and after over-writing are as follows:
(1) prior to over-writing:- Written statement of Defendant No.2 u/O VIII R.1 of CPC 16 OS No.27225/2011 Subsequent to over-writing: Written statement of defendant No.4 u/O VIII R.1 of CPC.
2) Prior to over-writing:- The defendant No.2 in the above case begs to file their written-statement as under:
Subsequent to over-writing:- the defendant No.4 in the above case begs to file their Written statement as under:
Even this over-writing is found in the last sheet of the Written statement of defendant No.4. It is as follows:
Para No.18:- Prior to over-writing-Wherefore the defendant No.2 most humbly prays that:
Para No.18:-after over-writing:- Wherefore the defendant No.4 most humbly prays that:
Hence, it is seen that, the plea raised in the Written statement of defendant No.4 and in the Written statement of defendant No.2 are all one and the same.
26. On the basis of pleadings of both parties the following Issue No.1 to 7 are framed. The said Issues are as follows :- 17 OS No.27225/2011
ISSUES
1. Whether the plaintiff proves that, the defendants are liable to pay a sum of Rs.1,00,62,653-00 together with interest?
2. Whether the plaintiff proves that there is subsisting mortgage by deposit of title deeds?
3. Whether the defendants prove that the entire transaction has been closed and settled at a sum of Rs.60,00,000-00?
4. Whether the defendants prove that they have paid a sum of Rs.60,00,000-00 and therefore the mortgage stood discharged by the return of documents?
5. Whether the defendants prove that the suit is not maintainable and is barred under the provisions of the Karnataka Money Lenders Act and provisions of the Karnataka Prohibition of Charging Exorbitant Interest Act, 2004?18 OS No.27225/2011
6. Whether the plaintiff is entitled for the relief's sought for?
7. What order or decree?
27. To prove his case, the plaintiff himself got examined as PW1. In all 17 documents are marked as Exhibits-P1 to P17. On the side of the defendants, the defendant No.2 is examined as DW1 and the defendant No.3 is examined as DW2. No documents are marked as Exhibits on the side of the defendant. After closure of the evidence, the counsel for the plaintiff canvassed his arguments. Inspite of sufficient opportunities given to the defendants, the defendants have not canvassed the arguments. Hence, on 16.6.2015, it is recorded that, arguments is closed. Posted for judgement by adjourning the suit to 27.6.2015 for judgment. In the meantime, on 22.6.2015, the defendants filed application under Section 151 of CPC to advance the case. In this suit, the Hon'ble High Court of Karnataka has fixed the time for disposal of this suit in M.F.A No.4704/2013 in its Order dated: 10.10.2013, in which the Hon'ble High Court of Karnataka has fixed the time for disposal of this suit within one year from the date of receipt of the said 19 OS No.27225/2011 order. The contents of the order sheet goes to show that...> there is an entry in the order sheet dated:18.12.2013 regarding the receipt of the order copy of the said order. Hence, from that day, the one year expires on expiry of 17/12/2014. (I took the charge of this court on 31/5/2014. For the first time, this file placed before me in June 2014. At that time, it was at the stage of plaintiff's evidence). So as to dispose off the matter within the said period, the parties have not co-operated by attending the court on the date on which the matter is fixed for trial. Hence, on 18/12/2014, it is ordered to send the requisition to the Hon'ble High Court of Karnataka for extension of time. The Hon'ble High Court of Karnataka has extended the time upto six months which expires on the end of June-2015. Knowing all these facts, again, one of the party tried to drag on the proceedings even after hearing the arguments of the plaintiff and adjourn the suit on 16.6.2015 by recording that..> argument is closed and posted for judgement on 27.6.2015. Thereafter, one of the party i.e., the defendant filed an application on 22.6.2015 to advance the case from the stage fixed for judgement on 27.6.2015. To the said I.A., opponent i.e., plaintiff filed the objections and it was heard and passed the detailed order 20 OS No.27225/2011 by observing that->this applicant has availed more than 27 adjournments at the stage of evidence. Inspite of that, he has not proceeded further at the stage of evidence. The detailed order passed on the said I.A on 25.6.2015 is to be required to be perused so as to know the conduct of the party, though they are bound to co-operate with the court proceedings, so as to enable the court to dispose off the matter within the time fixed by the Hon'ble High Court of Karnataka. "As the time fixed by the Hon'ble High Court of Karnataka to the trial Court to dispose of the matter, is not only binding to the trial court, but, equally binding on the parties concerned". Because, only on the active participation of the party concerned, court can dispose of the matter within the time fixed by the higher court. With this observation, I proceed to analyse the materials placed before the court.
28. My answer to the above Issues are as follows :-
ISSUE NO.1 :- Partly in the affirmative
ISSUE NO.2 :- In the affirmative
ISSUE NO.3 :- In the negative
ISSUE NO.4 :- In the negative
21 OS No.27225/2011
ISSUE NO.5 :- In the negative
ISSUE NO.6 :- Partly in the affirmative
ISSUE NO.7 :- As per final order
for the following
REASONS
29. ISSUE NO.1 :- This Issue is on the plaintiff. In this Issue, the plaintiff has to prove that, the defendants are liable to pay a sum of Rs.1,00,62,653/- together with interest. The PW1 is the plaintiff. In his affidavit, filed by way of examination in chief, has reiterated the plaint averments which are as stated in the above Paras referred as: The averments of the plaintiff in brief. In the Affidavit at Para Nos. 2 and 3, the PW1 has sworn in detail regarding the transactions stating that......> I knew Sri.GopalaKrishna, father of the defendants and other members of the family for over a decade. In the Plaint Para No.3, this plaintiff has pleaded that.......> plaintiff knew GopalaKrishna father of the defendants and other members of the family for over a decade. In the written-statement, this plea is not denied. On the other hand, it is admitted by pleading that.....> Plaintiff knew Sri.GopalaKrishna, father of the defendants and other members of 22 OS No.27225/2011 the family, is only with the contest of the money lent by the plaintiff and not otherwise. The PW1 in the Affidavit at Para No.2 further sworn that......> The said Gopalakrishna had borrowed a sum of Rs.72 Lakhs from KSFC. Though said GopalaKrishna had paid various sums, he was still due in a sum of Rs.22,94,324/- to KSFC. The property would have come for auctioning. Hence, he sought for financial assistance from me and assured that, the amount would be repaid within a period of 3-4 months. In Para No.3 of the Affidavit, PW1 has sworn that.....> I have furnished the Demand Drafts in favour of the KSFC..... Bangalore. The entire loan amount was paid to the KSFC on behalf of said GopalaKrishna by me...... along with the DDs the sum of Rs.7,05,676/- was paid in the name of L.GopalaKrishna vide Cheque No.972970 dated: 18.8.2006 totally amounting to Rs.30,00,000/- [Rs.22,94,324/-+ Rs.7,05,676/-]..... the KSFC wrote a letter to L.Gopalakrishna stating that, the entire payment has been paid by Sri.Basant Kumar Pail and all the persons interested had sought release of the collateral security documents in favour of Sri.Basant Kumar Patil. Once again KSFC wrote letter to L.GopalaKrishan stating that, the documents would be handed over 23 OS No.27225/2011 to me [i.e., Basant Kumar Patil].....L.GopalaKrishna along with G.K.Umashankar obtained an additional loan of Rs.5 Lakhs on 22.1.2007 vide Cheque No.872329. Gopalakrishna became due in a sum of Rs.36,26,375/- along with interest [These particulars shows that, in August-2006, the PW1 paid total sum of Rs.30,00,000/- out of which, Rs.22,94,324/- was towards the satisfaction of the loan liability of L.GopalaKrishna to the KSFC and Rs.7,05,676/- through Cheque and on 22.1.2007 had paid sum of Rs.5 Lakhs through cheque.. The total payment made by the plaintiff is Rs.30,00,000/-+ Rs.5,00,000=Rs.35,00,000/- as on 1.1.2007. The total liability of L.GopalaKrishna was arrived as Rs.36,26,375/-. the excess sum of Rs.35,00,000/- which is the capital amount as interest towards the sum of Rs.35,00,000/- advanced by him towards the discharge of loan of L.Gopalakrishna to KSFC and towards the payment made to GopalaKrishna and his sons. These particulars show that, from August-2006 to January-2007. For 5 months period to the sum of Rs.30,00,000/-, the interest arrived is Rs.1,26,375/- as the payment of Rs.5,00,000/- is made on 22.1.2007].
24 OS No.27225/2011
30. The further averments of the Affidavit of the PW1 shows that, Gopala Krishna went on making requests by letters dated: 5.5.2007, 3.9.2007, 3.10.2008 and 31.5.2005 and confirmed the amount as on 31.5.2008 as Rs.39,94,082/- and on 3.7.2008, he wrote another letter seeking time upto 30.9.2008. On 5.7.2008, the plaintiff wrote letter to the said GopalaKrishna asking to repay the amount on or before 30.9.2008. In the meantime, he died. Then the wife of GopalaKrishna wrote letter dated: 19.1.2009 and confirmed loan liability on 31.3.2009, 30.4.2009, 8.10.2009, 25.1.2010 and 16.4.2010. According to the contents of the Affidavit of the plaintiff, his further evidence in Para No.3 of the Affidavit in the last few lines are that:.....> "Ultimately, confirmation in respect of Rs.60,69,135.37 was made as on 31.12.2009. Thereafter, the plaintiff addressed letters stating that, the amount due is Rs.64,81,808.02 as on 31.3.2010. According to PW1, the defendant No.1 has confirmed the balance as on 30.11.2011. The sum due by the defendants is Rs.1,00,62,653/- ". This is the Affidavit evidence of the PW1 by way of examination-in- chief. In the further examination-in-chief, he has produced in all 25 OS No.27225/2011 17 documents marked as Exs.P1 to P17 in support of the claim of the plaintiff.
31. In the cross-examination, the PW1 has deposed that:
"1£Éà ¥ÀæwªÁ¢ UÀAqÀ J¯ï. UÉÆÃ¥Á®PÀȵÀÚ £À£ÉÆßA¢UÉ a£ÀßzÀ ªÁå¥ÁgÀ ªÀiÁqÀÄwÛzÀÝgÀÄ. DzÀÝjAzÀ CªÀgÀ ¥ÀjZÀAiÀÄ £À£ÀUÉ DVzÉ. CªÀgÀÄ ¤ªÀÄä£ÀÄß AiÀiÁªÀÅzÀPÉÆÌøÀPÀgÀ ¸ÀA¥ÀQð¹zÀÝgÀÄ CAzÀgÉ F ªÁåeÁåzÀ zÁªÁzÀ D¹Û DzÀ UÉÆÃPÀÄ® PÁA¥ÉèPïì ªÉÄÃ¯É PÉ.J¸ï.J¥sï.¹ AiÀÄ ¸Á® EzÉ DzÀÝjAzÀ £À£ÀUÉ D «µÀAiÀĪÁV ºÀtPÁ¹£À ¸ÀºÁAiÀÄ ªÀiÁrj JAzÀÄ £À£Àß §½UÉ §A¢zÀÝgÀÄ. DUÀ CªÀgÀÄ £À¤ßAzÀ 30 ®PÀë gÀÆ. ºÀtªÀ£ÀÄß D ¸ÀzÀj «µÀAiÀĪÁV ¸Á® PÉýzÀgÀÄ. D «µÀAiÀĪÁV £Á£ÀÄ CªÀjUÉ r.r. ªÀÄÄSÁAvÀgÀ 22 ®PÀë 94 ¸Á«gÀzÀ 3£ÀÆgÀ E¥ÀàvÁÌ®ÄÌ gÀÆ.UÀ¼À£ÀÄß PÉÆnÖgÀÄvÉÛÃ£É CAzÀgÉ ¤d. ¸ÀzÀj ºÀtªÀ£ÀÄß PÉ.J¸ï.J¥sï.¹AiÀÄ ¸Á®zÀ ¨Á§ÄÛ dªÀiÁ ªÀiÁrPÉƼÀî®Ä PÉÆnÖgÀÄvÉÛãÉ...... 30 ®PÀë gÀÆ. ¨Á§ÄÛ G½zÀ ºÀtªÀ£ÀÄß CªÀjUÉ DªÁUÀ¯Éà ZÉPï ªÀÄÄSÁAvÀgÀ PÉÆnÖgÀÄvÉÛãÉ...... 2£Éà PÀAvÁV ºÀtªÀ£ÀÄß AiÀiÁªÁUÀ AiÀiÁjUÉ PÉÆnÖ¢ÝÃgÁ CAzÀgÉ 5 ®PÀë gÀÆ.UÀ¼À£ÀÄß 2007£Éà E¸À« d£ÀªÀj wAUÀ¼À°è ¸ÀzÀj UÉÆÃ¥Á®PÀȵÀÚ EªÀjUÉ PÉÆnÖgÀÄvÉÛãÉ........ 2£Éà PÀAvÁV PÉÆlÖ 5 ®PÀë gÀÆ.UÀ¼À£ÀÄß £Á£ÀÄ CªÀjAzÀ ªÁ¥À¸ï £ÀUÀzÁV ¥ÀqÉzÀÄPÉÆArgÀÄvÉÛÃ£É CAzÀgÉ ¸ÀjAiÀÄ®è. UÉÆÃ¥Á®PÀȵÀÚgÀªÀgÀÄ vÁªÀÅ £À¤ßAzÀ ¥ÀqÉzÀ ¸Á®PÉÌ wAUÀ¼ÀÄ wAUÀ¼ÀÄ §rØAiÀÄ£ÀÄß 26 OS No.27225/2011 PÉÆqÀÄwÛzÀÝgÀÄ CAzÀgÉ ¸ÀjAiÀÄ®è. In the further cross-examination at Page No.4, PW1 has deposed that........> F zÁªÁ D¹ÛUÉ ¸ÀA§AzÀs¥ÀlÖ ªÀÄÆ® zÁR®ÉUÀ¼ÀÄ £À£Àß ¸Áé¢üãÀzÀ°è 2010 £Éà E¸À«ªÀgÉUÀÆ EzÀݪÀÅ CAzÀgÉ ¤d. ¥ÀæwªÁ¢UÀ¼ÀÄ zÁªÁ ¸ÀéwÛ£À zÁR¯ÉUÀ¼À£ÀÄß PÁ¸ïªÀiÁ¸ï ¨ÁåAPï£À°è CqÀªÀiÁ£À ªÀiÁr C°èAzÀ ¸Á® ¥ÀqÉzÀÄ £À£Àß ¸Á® ªÀÄgÀÄ¥ÁªÀw ªÀiÁrgÀÄvÁÛgÉ CAzÀgÉ ¸ÀļÀÄî." Further, in the cross-examination on dated: 16.7.2014 at Page No.7, this PW1 has deposed that......> ¥ÀæwªÁ¢AiÀÄgÀÄ £À£UÀ É PÉÆqÀ¨ÉÃPÁzÀ ¸Á®ªÀ£ÀÄß £ÀªÀÄä ªÀiÁå£ÉÃdgï ¥Àæ¸À£ÀßPÀĪÀiÁgïgÀªÀjUÉ wÃgÀĪÀ½ ªÀiÁrgÀÄvÁÛgÉ CAzÀgÉ ¸ÀjAiÀÄ®è. F zÁªÁzÀ°è £ÀªÀÄÆ¢¹gÀĪÀ ªÀåªÀºÁgÀPÉÌ ¸ÀA§AzÀ¥ÀlÖAvÉ £Á£ÀÄ F ¥ÀæwªÁ¢AiÀÄjUÉ 30 ®PÀë gÀÆ ªÀiÁvÀæ ¸Á® PÉÆnÖgÀÄvÉÛÃ£É CAzÀgÉ ¸ÀjAiÀÄ®è. 35 ®PÀë PÉÆnÖgÀÄvÉÃÛ £É........ In Page Nos.7 and 8 of the cross-examination, the PW1 has deposed that.....> F zÁªÁzÀ°è ¥ÀæwªÁ¢AiÀÄgÀÄ £À£ÀUÉ MAzÀÄ PÉÆÃn 62 ¸Á«gÀzÀ 6 £ÀÆgÀ LªÀvÀÛªÀÄÆgÀÄ gÀÆ.UÀ¼À£ÀÄß PÉÆqÀĪÀÅzÀÄ ¨ÁQ EzÉ JAzÀÄ zÁR°¹gÀÄvÉÃÛ £É CAzÀgÉ ¤d. ¤ÃªÀÅ PÉÆlÖ 35 ®PÀë gÀÆUÉ wAUÀ½UÉ ±Éà 3gÀAvÉ §rØ DPÀgÀuÉ ªÀiÁr 28-08-2006jAzÀ zÁªÁ zÁR°¸ÀĪÀªÀgÉUÉÀ ¯ÉPÀÌ ªÀiÁr 1 PÉÆÃn 62 ¸Á«gÀzÀ 6 £ÀÆgÀ LªÀvÀÛªÀÄÆgÀÄ gÀÆ ºÀtªÀ£ÀÄß zÁªÁzÀ°è £ÀªÀÄÆ¢¹gÀÄvÉÃÛ £É CAzÀgÉ ¸ÀjAiÀÄ®è. F zÁªÁzÀ°è ªÀÄÆ® ºÀt 35 ®PÀëPÉÌ CzÀgÀ 2¥ÀlÄÖVAvÀ ºÉaÑUÉ §rØ DPÀgÀuÉ ªÀiÁr zÁªÁ zÁR°¹gÀÄvÉÃÛ £É CAzÀgÉ 27 OS No.27225/2011 ªÀÄÆ® ºÀt ºÁUÀÆ CzÀgÀ ªÉÄð£À §rØ ¸ÀÉÃj zÁªÁzÀ°è £ÀªÀÄÆ¢¹zÀ ªÉÆvÀÛ DUÀÄvÀÛzÀÉ...... F zÁªÁzÀ°è £ÀªÀÄÆ¢gÀƪÀ UÉÆÃPÀįïPÁA¥èÉPïìzÀ zÁR¯ÁwUÀ¼À£ÀÄß PÁ¸ïªÀiÁ¸ï ¨ÁåAQ£À°è 2010£Éà E¸À«AiÀÄ°è CqÀªÀiÁ£À ªÀiÁr £À£Àß F ¸Á®ªÀ£ÀÄß ªÀÄgÀÄ¥ÁªÀw ªÀiÁrgÀÄvÁÛgÉ CAzÀgÉ ¸ÀjAiÀÄ®è......
32. In the cross-examination dated: 1.8.2014 at Page No.10 and in Page No.11, this PW1 has deposed that......> ¥ÀæwªÁ¢ vÀAzÉ UÉÆÃ¥Á®PÀȵÀÚgÀªÀgÀÄ PÉ.J¸ï.J¥sï.¹¬ÄAzÀ 72 ®PÀë gÀÆ¥Á¬ÄUÀ¼À£ÀÄß ¸Á® ¥ÀqÉzÀÄPÉÆArzÀÝgÀÄ CAzÀgÉ EgÀ§ºÀÄzÀÄ. ¸ÀzjÀ ¸Á®ªÀ£ÀÄß F zÁªÁ D¹ÛAiÀÄ£ÀÄß CqÀªÀiÁ£À ªÀiÁr ¥ÀqÉzÀÄPÉÆArzÀÝgÀÄ CAzÀgÉ ¤d. PÉ.J¸ï.J¥sï.¹AiÀÄ°è ªÀ£ï mÉʪÀiï ¸ÉmïèªÉÄAmï CAvÀ 22 ®PÀë 94 ¸Á«gÀ gÀÆ¥Á¬ÄUÀ¼À£ÀÄß ¥ÁªÀw ªÀiÁrzÀgÉ ¸Á® wÃgÀĪÀ½ DUÀÄvÀÛzÉ JAzÀÄ ¸ÀzÀj ºÀtªÀ£ÀÄß ªÀÄgÀÄ¥ÁªÀw ªÀiÁqÀ®Ä ¥ÀæwªÁ¢UÀ¼ÀÄ £À£Àß ºÀwÛgÀ ¸Á® PÉýzÀgÀÄ CAzÀgÉ ¤d...... ¸ÀzÀjAiÀĪÀgÀÄ ±ÉÃqÁ 27gÀAvÉ §rØ PÉÆqÀ®Ä M¦àzÀÝgÀÄ. D ¥ÀæPÁgÀ £Á£ÀÄ M¦à ¥ÀæwªÁ¢AiÀÄjUÉ ¸Á® PÉÆnÖgÀÄvÉÛãÉ..... PÉ.J¸ï.J¥sï.¹UÉ ¸ÀzÀj ºÀtªÀ£ÀÄß £Á£ÀÄ ªÀÄgÀÄ¥ÁªÀw ªÀiÁrzÀ £ÀAvÀgÀ ¥ÀæwªÁ¢AiÀÄgÀÄ CqÀªÀiÁ£À EnÖzÀÝ zÁR¯ÁwUÀ¼À£ÀÄß £À£ÀUÉ PÉÆqÀ®Ä PÉ.J¸ï.J¥sï.¹UÉ °TvÀªÁV «£ÀAw¹PÉÆArzÀÝgÀÄ. ¢£ÁAPÀ 29-08-2006 gÀAzÀÄ zÁªÁ ±ÉqÀÆå¯ï D¹ÛUÉ ¸ÀA§AzÀ¥ÀlÖ zÁR¯ÁwUÀ¼À£ÀÄß ¤±Á£É ¦ 4 gÀ ¥ÀvÀæzÀ ¥ÀæPÁgÀ PÉ.J¸ï.J¥sï.¹AiÀĪÀgÀÄ £À£Àß ¸Áé¢üãÀPÉÌ PÉÆnÖgÀÄvÁÛgÉ CAzÀgÉ 28 OS No.27225/2011 ¤±Á£É ¦ 4 gÀ ¥ÀvÀæzÀ°è PÉ.J¸ï.J¥sï.¹AiÀĪÀgÀÄ ªÀÄÆ® zÁR¯ÉUÀ¼À£ÀÄß £À£Àß ¸Áé¢üãÀPÉÌ PÉÆqÀĪÀÅzÁV zÀÈrÃPÀj¹gÀÄvÁÛgÉ......."
33. This is the material oral evidence of the PW1 in connection with the loan transaction. On perusal of the above referred evidence of the PW1 and the documents marked as Exs.P1 to P17, it is seen that, the deceased Gopala Krishna and this plaintiff were doing business in Gold and also seen that, the deceased Gopala Krishna approached this plaintiff for financial assistance to discharge his loan taken in KSFC. Hence, the plaintiff has advanced the loan to discharge the loan taken in the KSFC by said Gopalakrishna
34. In the written-statement of defendant No.2 and defendant No.4, they have taken the contention that, the plaintiff is doing money-lending business. Though the defendant No.2 filed affidavit by way of examination in chief as DW1 and defendant No.4 has filed his Affidavit by way of examination in chief as DW2, no single instance of alleged private money lending of the plaintiff is stated by mentioning the details as to whom and when this plaintiff has 29 OS No.27225/2011 advanced the loan, so as to establish that, this PW1 is doing private money lending business. On the other hand, the suggestion made to the PW1 in the cross-examination on dated: 1.8.2014 recorded in Page No.11 shows that-> the defendants themselves approached PW1 requesting to advance the loan to discharge the loan taken in KSFC. The evidence of PW1 deposed in Page No.2 of the cross- examination on dated: 5.7.2014 shows that, L.Gopala Krishna and this plaintiff were doing business in Gold...
"J¯ï. UÉÆÃ¥Á®PÀȵÀÚ £À£ÉÆßA¢UÉ a£ÀßzÀ ªÁå¥ÁgÀ ªÀiÁqÀÄwÛzÀgÝ ÀÄ. DzÀÝjAzÀ CªÀgÀ ¥ÀjZÀAiÀÄ £À£ÀUÉ DVzÉ." When such being the case, the act of this plaintiff in advancing the money on the request of said L.GopalaKrishan cannot be termed as an act of money lending business. In view of the principles laid-down in the citation given in ILR 1986 (I) Kar Page 180 in a case Katte Shivappa V/s Kari Eranna-> In this it is stated that -> In order to make person money lender within the meaning of the Act, the defendant must show that, the plaintiff has been advancing a series of loan in continuity. Two or three stray instances of lending money will not make him as money lender. The activities of money lending must be carried on 30 OS No.27225/2011 as a business. There must be profit motive and money lending must be carried on as a profession... When such being the base, though defendants-2 and 4 have raised plea in the written- statement that, the plaintiff is the money lender, no such other instances of money lending stated to be made by the plaintiff is even not narrated in their written-statement. Hence, the act of advancing of loan by this plaintiff to the deceased GopalaKrishna (who approached him for financial assistance) who is the father of the defendant Nos.2 to 4 and the husband of defendant No.1 with whom this plaintiff carried Gold business cannot be termed as money lending.
35. The above referred evidence of the PW1 shows that, in connection with the transaction , the plaintiff has advanced a sum of Rs.35 Lakhs. As in the cross-examination on dated: 16.7.2014 at Page No.7, suggestion is made to the PW1 stating that, he has paid a sum of Rs.30 Lakhs. He denied this suggestion and deposed that, he paid Rs.35 Lakhs.>This evidence of the P.W.1 deposed in the cross-examination on dated: 16.7.2014 at Page No.71 is as follows :-
31 OS No.27225/2011
....> F zÁªÁzÀ°è £ÀªÀÄÆ¢¹gÀĪÀ ªÀåªÀºÁgÀPÉÌ ¸ÀA§AzÀ¥ÀlÖAvÉ £Á£ÀÄ F ¥ÀæwªÁ¢AiÀÄjUÉ 30 ®PÀë gÀÆ ªÀiÁvÀæ ¸Á® PÉÆnÖgÀÄvÉÛÃ£É CAzÀgÉ ¸ÀjAiÀÄ®è. 35 ®PÀë PÉÆnÖgÀÄvÉÛãÉ.... In the cross-examination of PW1 on dated:
5.7.2014, at Page Nos. 2 and 3, he has deposed that.....> MlÄÖ CªÀjUÉ ¤ÃªÀÅ 30 ®PÀë gÀÆ. PÉÆnÖgÀÄwÛÃgÁ CAzÀgÉ PÉÆnÖgÀÄvÉÛÃ£É CzÀ£ÀÄß ªÀÉÆzÀ¯£Éà PÀAvÁV PÉÆnÖgÀÄvÉÛãÉ..... 2 £Éà PÀAvÁV JµÀÄÖ ºÀtªÀ£ÀÄß AiÀiÁªÁUÀ AiÀiÁjUÉ PÉÆnÖ¢ÝÃgÁ CAzÀgÉ 5 ®PÀë gÀÆ.UÀ¼À£ÀÄß 2007£Éà E¸À« d£ÀªÀj wAUÀ¼À°è ¸ÀzÀj UÉÆÃ¥Á®PÀȵÀÚ EªÀjUÉ PÉÆnÖgÀÄvÉÛãÉ...... ¸ÀzÀjAiÀĪÀjUÉ 2£Éà PÀAvÁV PÉÆlÖ 5 ®PÀë gÀÆ.UÀ¼À£ÀÄß £Á£ÀÄ CªÀjAzÀ ªÁ¥À¸ï £ÀUÀzÁV ¥Àqz É ÀÄPÉÆArgÀÄvÉÃÛ £É CAzÀgÉ ¸ÀjAiÀÄ®è." In the Affidavit filed by way of examination in chief of PW1 at page No.3 in the middle, this PW1 has deposed/sworned that.>- - - - - - -"I" submit that, L.Gopala Krishna along with Sri.G.K.Umashankar obtained an additional loan of Rs.5 Lakhs on 22.1.2007 vide Cheque No.872329...... The said G.K.UmaShankar is the DW1. In his Affidavit, at Para No.4, has sworn that.> A similar letter appears to have been obtained 32 OS No.27225/2011 on 5.5.2007 where it is shown that, the total loan amount was Rs.41,05,000/- and additional loan amount of Rs.5,00,000/- was paid on 22.1.2007 where a cheque was given in my name. I was made to withdraw the cash and give it back to the plaintiff's Manager and this Rs.5,00,000/- is again shown as having been paid on 5.5.2007. ..... This content of the evidence of DW1 sworn in the Affidavit filed by way of examination-in-chief shows that-> he has "admitted" the receipt of cheque in his name to the sum of Rs.5,00,000/-. But, "his say" is that, he encashed the cheque and paid the cash of Rs.5,00,000/- to the plaintiff's "Manager". This portion of evidence regarding the said Payment is an allegation".
But where as the receipt of cheque in his name and the encashment of the cheque "is an admission". The principles of Law is that.> Admitted facts need not be proved. On the other hand, the allegation mad is to be proved. In the above referred evidence of DW1 sworn in Para No.4 of his Affidavit shows that, he has admitted the receipt of cheque for value of Rs.5,00,000/- drawn in his name. This fact is not required to be proved, as it is admitted one. But, allegation of repayment to the Manager of this PW1 is to be proved, to that effect that -> there is no acceptable evidence laid 33 OS No.27225/2011 before the court by the DW1. On the other hand, his evidence shows that, the said Cheque is issued vide Ex.P5 in the name of this D.W.1 and he got encashed the same.
36. Hence, on all these grounds, plaintiff proved that, so far as regards this transaction he has advanced the sum of Rs.35 Lakhs to the deceased Gopala Krishna and his son G.K.Umashankar (DW1).
37. The PW1 in his Affidavit at Para No.2 at the end has sworn that.> The agreed interest is 2.25% per month.....This evidence of the PW1 shows that, he charged interest at 2.25% per month which "will" yield at the rate of 2.25% X 12= "27%" per annum. No doubt, this PW1 is not the money lender and also not the financial institution. If the PW1 is one among the above said two category either as financial institution or as private money lender, then quantum of charging of interest governed under the Money Lenders Act or Financial Institutions advancing guidelines issued by RBI were applicable. But, to this PW1 both are not applicable. When such being the case, whether the PW1 can enter 34 OS No.27225/2011 into an Agreement to demand the interest at 2.25% per month which is the sum now claimed by him? The counsel for the plaintiff in his Arguments has submitted that-> The defendants themselves have agreed to pay the said sum. Hence, the plaintiff is entitled to the interest as agreed between him and the defendants. He submitted in Para No.3 of his written-arguments at the end stating that-> The defendants have also agreed to pay interest at the rate of 2.5% per month towards the above amount. If the submission is considered then the amount of interest payable is 2.5% X 12=30% per annum. In support of his submission, the counsel for the plaintiff relined on the citations given in 2009 AIR SCW 1934 S.K.Jain V/s. State of Haryana & Anr. Head Note (A)-
"Arbitration agreement-Validity-Agreement clause providing for mandatory security deposit by contractor-cannot be challenged on ground that, it was result of unequal bargaining power of parties- Concept of unequal bargaining power has no application in case of commercial contracts....> In the citation at Para No.3, it is mentioned that....> On 4.3.1992, an agreement was entered into between the parties, which incorporated sub-clause(7) of clause 25-A providing for arbitration in case of any dispute...>This 35 OS No.27225/2011 contention of Para No.3 of the Judgement shows that.> there was an agreement dated: 4.3.1992 which obliged the appellant to deposit 7% of the total claim and incorporated sub-clause(7) of Clause 25-A providing for arbitration........> This is not the situation on the suit on hand to the effect of depositing 7% of the total claim. But, payment of interest is involved. Hence, the principles laid down in the said citation cannot be made applicable to the case on hand. In this suit on hand, the provisions of Indian Contract Act are applicable. As per Sec. 23 of the Indian Contract Act-> The consideration or object of an agreement is lawful, unless..> is of such nature that-> if permitted, it would defeat the provisions of any law...... This Clause of Sec.23 of the Indian Contract Act is applicable. According to this, Sec.23 of the Indian Contract Act-> the agreement is lawful unless it would defeat the provisions of law..> In the suit on hand, the plaintiff is not the money lender so as to bring his act of charging interest under the Money Lenders Act and this plaintiff is not the financial institution so as to made applicable the RBI Guidelines in charging interest on the advance made by him. Under such circumstances, his act of charging interest be controlled under Sec.23 of the Indian Contract 36 OS No.27225/2011 Act referred above. As per this Section, the Agreement is lawful, unless it would defeat the provisons of law. Now the question before this court is, if the plaintiff is permitted to charge the interest at 2.25% per month i.e., 27% per annum defeats the provisions of law. In my considered view, it defeats the provisions of law relating to Money Lenders Act, in which more privilege is given to the Money Lenders in charging interest as compared to the RBI rate of interest and also it affects the law relating to Prohibition of Charging Exorbitant Interest Act, 2004.
38. In AIR 2010 SC at Page No.1511 in case of State of Haryana and others Vs. M/s.S.L.Arora and Company [relied by the plaintiff], in Head Note(A) it is stated that-> Compound Interest- Power to levy- Only if there is specific contract or authority under Statue. In Head-Note (C)-> it is stated that-> If rate is not specified or interest is not excluded, rate of 18% would apply. On perusal of these principles, it is seen that, in Head-Note (A) it is stated that->compounding of interest is to be made only if there is specific contract or authority under Statute-> But, in the suit on 37 OS No.27225/2011 hand, question before the court is not only compounding of interest but, also question of rate of interest.
39. In AIR 2001 SC Page 3095 in case of Central Bank of India in Head Note (A) it is held that.>......The principal sum adjudged included the amount of interest charged on a periodical rests and capatalized with the principal sum actually advanced.
40. In the suit on hand, the interest claimed by the plaintiff is at 2.25% per month will yield 27% per "annum" which exceeds the limit of interest under the provisions of Money Lenders act and also comes under the category of Exorbitant Interest Act. Hence, the award of 18% interest compounded quarterly would justify the claim or the demand regarding rate of interest. Hence, I hold that, the plaintiff is entitled to the principal sum of Rs.35 Lakhs with interest at the rate of 18% compounded quarterly instead of 2.25% per month compounded once in two months which yields more than 27% per annum as the value of 2.25% p.m. interest will be 27% per annum and arrived to its claim of Rs.1,00,62,653/-. Hence, it is held that, the plaintiff is entitled to interest at 18% 38 OS No.27225/2011 compounded quarterly on the principal sum of Rs.35 Lakhs from the date of advancement of loan (of Rupees thrity five lakhs) till the date of realisation. Accordingly, I answered this Issue No.1 in the partly affirmative.
41. ISSUE NO.2:- This Issue is on the plaintiff. In this Issue, the plaintiff has to prove that, there is subsisting Mortgage by deposit of title deeds. In the Plaint Para Nos. 5 and 6, the plaintiff has pleaded that.> GopalaKrishna had borrowed a sum of Rs.72 Lakhs from KFSC mortgaging the suit schedule property. Though the said GopalaKrishna paid various sums, he was still in due a sum of Rs.22,94,324/- to be paid to KSFC, the property would have come for auctioning. Hence, he sought for financial assistance of the plaintiff. As original documents were with the KSFC, Gopala Krishna had written a letter dated: 17.8.2006 to the KSFC to hand over all the original mortgaged papers to the plaintiff. In Para No.7 of the plaint, plaintiff pleaded that.> plaintiff wrote a letter to KSFC. The plaintiff furnished the Demand Draft in favour of the KSFC total amounting to Rs.22,94,324/- drawn on Indusind Bank, M.G.Road Branch, Bangalore. The entire loan amount was 39 OS No.27225/2011 paid to the KSFC on behalf of the said Gopala Krishna by the plaintiff. The KSFC wrote a letter to L.Gopala Krishna stating that, the entire payment had been paid by Sri.Basant Kumar Patil and all the persons had interested had sought release of the collateral security documents in favour of Sri.Basant Kumar Patil. Once again on 29.8.2006 KSFC wrote a letter to L.Gopala Krishna stating that, the document would be handed over to the plaintiff.
42. In the Affidavit filed by way of examination-in-chief, the PW1-plaintiff has sworn to the above facts in the Affidavit in Para No.3. On perusal of the documents produced by the plaintiff got marked as Exs.P1 to P17, it is seen that,-> Ex.P4 is the letter dated: 29.8.2006 issued by the KSFC to the L.GopalaKrishna, in which, it is communicated to L.Gopala Krishna stating that, as per the consent letter of the Gopala Krishna dated: 17.8.2006 and other letters mentioned in Reference, has informed to said Gopala Krishna stating that-> in view of closure of three loan accounts by Basant Kumar Patil, the documents are handed over to him. Hence, on al these materials, the plaintiff proved that-> subsisting of 40 OS No.27225/2011 Mortgage by deposit of title deeds. Accordingly, I answered this Issue No.2 in the affirmative.
43. ISSUE NO.3:- This Issue is on the defendants. In this Issue, the defendants have to prove that, the entire transaction has been closed and settled at a sum of Rs.60,00,000/-. In the written statement of defendant No.2 and in the written statement of defendant No.4 at Para No.13, it is pleaded that-> The entire amount of principal as well as the interest due was settled amongst the plaintiff and the defendants at Rs.60,00,000/- [Rupees Sixty Lakhs only], which was to be paid by the end of October-2010. the plaintiff has insisted for the payment of entire amount only by means of cash and accordingly, the defendants had withdrawn the amount from the bank and paid the entire amount by cash, consequent upon which, the original documents were handed over by the plaintiff to the Manager of M/s.Cosmos Bank indicating this closure of said loan transactions. Defendants possess material and documents evidencing the same. The DW1 in the Affidavit at Para No.7 has reiterated stating that-> Plaintiff insisted for payment of entire amount. The defendants had sought for loan 41 OS No.27225/2011 from M/s.Cosmos Bank. The loan was sanctioned, since the plaintiff insisted that, he wants the entire amount of Rs.16,00,000/-[ought to be Rs.60,00,000/- as in the written statement at Para No.13 the entire amount of principal as well as interest is mentioned as Rs.60,00,000/-] which was settled amount for the entire loan transaction. But, to prove this aspect, no documents are produced by the defendants [DW1]. In the evidence of the DW2, there is nothing to this effect. Mere plea without proof is of no use in favour of either of the party. Hence, on all these grounds, I hold that, the defendants have not proved this Issue No.3 casted on them. Accordingly, I answered this Issue No.3 in the negative.
44. ISSUE NO.4:- In this Issue, the defendants have to prove that-> they have paid the sum of Rs.60,00,000/- and mortgage stood discharged by the return of documents. In the written statement at Para No.13 itself, this plea is raised by defendants-2 and 4. For the reasons stated to the Issue No.4 in detail, the defendants have failed to prove the plea of settlement of entire loan transaction of sum of Rs.60 Lakhs and its repayment by the 42 OS No.27225/2011 defendants to the plaintiff. When such being the case, the defendants have failed to prove this Issue No.4. Accordingly, I answered this Issue No.4 in the negative.
45. ISSUE NO.5:- In this Issue, the defendants have to prove that, suit is not maintainable and is barred under the provisions of Karnataka Money Lenders Act and provisions of Karnataka Prohibition of Charging Exorbitant Interest Act, 2004. In the written statement at Para No.15, defendants-2 and 4 have raised this plea. But, in the citation given in ILR 1986(1) Kar Page180 in a case Katte Shivappa Vs. Kari Eranna.> it is held that.> In order to make a person money lender within the meaning of this Act, the defendant must show that, the plaintiff has been advancing a series of loan in-continuity. Two or three stray instances of lending money will not make him a money lender. The activities of money lending must be carried on as a business. There must be a profit motive and money lending must be carried on as a profession. These observations made in this citation shows that, only after proof of these ingredients, one can be called as a money lender. So far as regards the plaintiff of this suit is concerned, the defendants 43 OS No.27225/2011 have not placed acceptable materials before this court to hold that-> The plaintiff is the money lender. Hence, this Issue No.5 is to be answered in the negative. Accordingly, I answered this Issue No.5 in the negative.
46. ISSUE NO.6:- In this Issue, it to be determined whether the plaintiff is entitled for the relief sought for. This Issue is to be adjudicated on the findings given to the Issues-1 and 2 above. For the reasons stated to Issue No.1 this court held that-> Plaintiff has proved that, he has advanced the total sum of Rs.35 Lakhs to the defendants out of which, the sum of Rs.22,94,324/- towards the satisfaction of the loan due in KSFC and the payment of balance of Rs.7,05,676/- in the name of L.GopalaKrishna by Cheque bearing No.972970 [total sum of Rs.22,94,324/- +Rs.7,05,676/-] Rs.30,00,000/- paid to L.Gopala Krishna and payment of Rs.5 Lakhs to L.Gopala Krishna and to G.K.Umashankar on 22.1.2007 vide Cheque No.872329. In all a sum of Rs.35 Lakhs. It is fully discussed in the reasons quoted on Issue No.1 and also it is held in the said Issue No.1 stating that, the plaintiff is entitled for interest at 18% p.a. compounded 44 OS No.27225/2011 quarterly instead of his claim at 2.25% per month compounded once in two months from the date of suit till the date of realization with cost. Accordingly, I answered this Issue No.6 partly in the affirmative.
47. ISSUE NO.7:- In the result, I proceed to pass the following Order:
ORDER In the result, suit of the plaintiff is partly decreed with costs.
In the consequences, it is held that->
defendants are liable to pay the sum of
Rs.35,00,000/- [Rupees thirty five lakhs only]
with interest at the rate of 18% p.a.
compounded quarterly from the date of
advancement of loan till the date of realization.
The defendants are jointly and severally liable to pay the above said sum. Defendants have to pay the above said sum within six months from the date of judgment and decree.
In failure of which, plaintiff is at liberty to proceed against the property mortgaged by the defendants to the plaintiff by way of an 45 OS No.27225/2011 equitable mortgage by way of sale of the property.
If the sale proceeds falls deficit, the plaintiff is at liberty to proceed against the defendants' remaining property and also against the person of the defendants 2, 3 and 4 who are male members, as the execution of the decree for recovery of money cannot be directed/initiated against the person of the woman who is defendant No.1.
In the even if the defendants repay the entire loan amount with interest and proportionate cost, with in the period of six months, in such event, the plaintiff has to return the original title documents deposited by the defendants. If necessary, plaintiff has to reconvey the mortgage property free from mortgage at the cost of the defendant.
Draw preliminary decree accordingly.
(Dictated to the Stenographer, transcript thereof, is corrected and then pronounced by me in the open court on this the 27th day of June, 2015) ( Mallareppa Veerappa Jadar ) XXVI Addl. City Civil and Sessions Judge Mayo Hall, Bangalore.
46 OS No.27225/2011
SCHEDULE PROPERTY
All the piece and parcel of the Property bearing No.9,
Kempanna Lane, Gokul Complex, Nagarath Pet,
Bengaluru-560 002, bounded on:
East: Kempanna Galli
West: G.Kishanlal
North: C.R.Lakshminarayana Setty House
South: S.Venkatachalapathy Setty House
along with superstructures.
ANNEXURES
1. List of witnesses examined for the plaintiff:
P.W.1 Basantkumar Patil 4.1.2014
2. List of witnesses examined for defendants:
D.W.1 G.K.Umashankar 15.12.2014
D.W.2 G.K.Suresh 3.1.2015
47 OS No.27225/2011
3. List of documents exhibited for the plaintiff:
Exs.P.1 to P3 3 letters dated: 18.8.2006 Ex.P.4 Letter dated: 29.8.2006 Ex.P.5 Letter dated: 1.1.2007 Ex.P.6 Receipt dated: 22.1.2007 Ex.P.7 Letter dated: 5.5.2007 Ex.P.8 Letter dated: 3.9.2007 Ex.P9 Letter dated: 3.1.2008 Ex.P.10 Letter dated: 31.5.2008 Ex.P11 Letter dated: 3.7.2008 Ex.P12 Letter dated: 31.3.2009 Ex.P13 Letter dated: 30.4.2009 Ex.P14 Letter dated: 8.10.2009 Ex.P15 Letter dated: 25.1.2010 Ex.P16 Letter dated: 3.2.2010 Ex.P17 Letter dated: 16.4.2010
4. List of documents exhibited for defendants: NIL ( MALLAREPPA VEERAPPA JADAR) XXVI Addl. City Civil & Sessions Judge Mayo Hall, Bangalore.