Bangalore District Court
Siddalingappa Sudhir vs Manohar.N.L on 13 January, 2017
IN THE COURT OF THE XIX ADDL. CITY CIVIL &
SESSIONS JUDGE AT BANGALORE CITY: (CCH.18)
Dated this 13th day of January, 2017.
Present
SMT.K.B.GEETHA, M.A., LL.B.,
XIX ADDL. CITY CIVIL & SESSIONS JUDGE,
BANGALORE CITY.
O.S.NO.6091/2014
PLAINTIFFS: 1. Siddalingappa Sudhir,
s/o late S.R.Siddalingappa,
aged about 46 years.
2. Sarvamangala Siddalingappa,
w/o late S.R.Siddalingappa,
aged about 76 years.
The plaintiffs are r/at at
No.268/50, Mukund Court,
Apartment No.5, 11th Cross,
Wilson Garden, Bangalore-27.
The address of 1st plaintiff
is also at No.23, Burnton Ct
Bloomington, IL-61704, USA.
(By Smt.S.K.Nagarathna,Advocate)
-VS-
DEFENDANTS : 1. Manohar.N.L.
s/o late N.R.Lingaraju,
aged about 33 years.
2. Nagarathna.N.L.
w/o late N.R.Lingaraju,
r/at No.1000,
2 O.S.No.6091/2014
11th Main, 3rd Stage,
1st Block, Basaveshwarnagar,
Bangalore-79.
( D.1 & D.2 - By Sri.R.S., Advocate)
Date of Institution of the suit : 7/8/2014
Nature of the Suit : Recovery of money
Date of commencement of recording
of evidence : 30/11/2015
Date on which the Judgment was
pronounced : 13/1/2017
Year/s Month/s Day/s
Total Duration : 02 05 06
JUDGMENT
The plaintiffs have filed this suit for recovery of Rs.17,00,000/- with interest at the rate of 21% p.a. from the date of agreement of sale dtd:8/5/2013 till filing of the suit amounting to Rs.4,46,250/-, totally amounting to Rs.21,46,250/-; for court costs and such other reliefs. 3 O.S.No.6091/2014
2. The case of plaintiffs in nutshell is that the defendants are the owners of property bearing BBMP Municipal No.16/9, Shakthi Ganapathy Nagar, 5th Cross, Bangalore with old PID No.16-24-16/9, New PID No.074- W0156-4 measuring East to West 33 feet and North to South 37 feet having purchased the same under Regd. Sale deed dtd:6/8/2012 from Smt.Umabai Janardhan Rao. Defendants applied for permission from BBMP authorities for construction on the above said property and obtained permission on 1/10/2012. Defendants intended to construct flat on the said property with four floors with name "Nandi Residency". In May, 2013 defendants approached plaintiffs offering to sell Flat No.003 in third and fourth floor of the property at Nandi Residency. After inspecting the spot and after scrutinizing all the documents pertaining to the property, plaintiffs agreed to purchase the said flat for Rs.85,50,000/-. Accordingly, an agreement of sale dtd:8/5/2013 was entered between parties. On that day, plaintiffs paid an advance of Rs.17,00,000/- to defendants through 2 cheques i.e., 1st 4 O.S.No.6091/2014 cheque bearing No.323371 amounting to Rs.2,00,000/- dtd:9/5/2013 drawn on State Bank of Mysore, Wilson Garden Branch and 2nd cheque for Rs.15,00,000/- dtd:27/5/2013 drawn on ICICI Bank, Jayanagar Branch, Bangalore, and agreed to pay the remaining Rs.68,50,000/- within 30/8/2013 and defendants agreed to complete the construction by said date and will hand over the property to plaintiffs. In the course of this period, 1st plaintiff who resides in USA was in contact with 1st defendant regarding this transaction. In the month of July, 1st defendant contacted the 1st plaintiff through e- mail and informed that it had become difficult for him to obtain loan as there was technical difficulties and 1st defendant could not obtain loan and complete the construction. Therefore, on that day itself, 1st defendant offered to return back the amount paid by plaintiff as advance. But, plaintiffs were still ready and willing to purchase the property after clearance of the said technicalities. After this, defendants did not inform the plaintiffs regarding the clearance of the technical 5 O.S.No.6091/2014 difficulties and plaintiffs waited for a word from defendants. When such being the case, plaintiffs got a notice issued by defendants through their counsel on 17/5/2014 canceling the agreement of sale and to repay the amount paid by plaintiffs after deducting the penal amount. In the said notice, it is alleged that plaintiffs failed in making payment as agreed upon. But, defendants were not ready to honour the agreement due to technical difficulties. Plaintiffs still had time to pay the balance consideration amount till 30/8/2013 and they were ready to pay it. Therefore, it was defendants who failed to honour the agreement and not the plaintiffs. Plaintiffs have suitably replied to the said notice. Defendants, who have defaulted in honouring the agreement of sale, cannot deduct any amount as penalty. The defendants, who have failed to act in accordance with the agreement, are liable to repay the entire amount with interest at 21% p.a. Hence, the suit for appropriate reliefs.
6 O.S.No.6091/2014
3. After service of suit summons, defendants appeared through their counsel and defendant No.1 filed written statement, which was adopted by defendant No.2.
4. In the written statement, defendant No.1 admitted about the suit transaction between plaintiffs and defendants and also admitted the receipt of Rs.17,00,000/- as an advance amount. But, he contended that suit is not maintainable either in law or on facts. Because, plaintiffs have approached this court with unclean hands and they have suppressed the material facts. The suit is filed only with fraudulent intention to extract money from defendants. He contended that it is plaintiffs who have committed breach of the agreement and not defendants. Defendant No.1 further contended that plaintiffs agreed to purchase the flat in question for Rs.85,50,000/- exclusive of Rs.1,50,000/- for car parking space. He denied that apartment could not be completed within the stipulated period. According to him, the apartment ought to have been completed on or before 7 O.S.No.6091/2014 15/12/2013 and not on 30/8/2013. He admitted that plaintiff No.1 was in contact with him and plaintiff No.1 expressed his intention to assist him in obtaining loan in respect of purchase of schedule apartment. Initially, he approached Axis Bank, but on account of technical difficulties, said loan processing could not be completed. But, defendant No.1 on behalf of plaintiffs approached SBM, wherein said bank had provided legal and valuation clearances subject to the guarantor to be provided by the plaintiffs residing in Bangalore as plaintiff is non-resident of India. The plaintiff No.1 only on his own had not decided to proceed with the loan. When Axis Bank had failed to provide loan to plaintiffs, defendants admitted to return back the amount immediately to the plaintiffs, but the plaintiffs having liked the schedule apartment insisted to take another chance in another bank and hence, defendant No.1 approached SBM on behalf of plaintiffs. Plaintiffs themselves did not want to seek refund of the amount, but decided to approach some other financial institutions. They have filed the loan application on 8 O.S.No.6091/2014 11/9/2013, subsequent to the defendants agreeing to receive the balance consideration within 15/12/2013, the date agreed to handover the possession of the schedule apartment subject to payment of the penal interest of 2% p.m. as agreed by the plaintiffs in the agreement. Subsequent to loan application being filled up and forwarded by plaintiffs to SBM, plaintiffs have sent e-mail to defendant No.1 to forward to SBM. Though the loan process in SBM was concluded, plaintiff could not have opted to take loan and complete the sale transaction. But plaintiffs on their own decided not to complete the contract for the reasons best known to them. When 1st plaintiff visited India during November 2013, he orally agreed to withdraw from the said contract and sought for refund of the amount. Defendants agreed to repay the amount subject to terms and conditions of the agreement of sale subsequent to deducting 5% of sale consideration amount as agreed in the agreement as well as penal interest at 2% p.m. on Rs.70,00,000/-. If the plaintiffs would have completed the contract as on November 2013, 9 O.S.No.6091/2014 plaintiffs ought to have been paid Rs.70,00,000/- along with 2% penal interest amounting to Rs.8,07,333/-. Thus, 5% of the sale consideration amount i.e., 4,35,000/- + 2% penal interest of Rs.8,07,333/-, totally amounting to Rs.12,42,333/- is to be withheld by defendant No.1 and he is liable to pay only the balance amount of Rs.4,57,667/- to the plaintiffs as on 3/11/2013. During November 2013, defendants were ready to pay the said amount to plaintiffs. But, plaintiffs did not come forward to take back the said amount. In between August, 2013 and November, 2013, defendants lost number of customers who were intended to purchase the schedule apartment at a higher rate than the agreed rate with the plaintiffs. Defendants waited for plaintiffs from 3/11/2013, but it was plaintiffs themselves who have not received the balance amount. Defendants themselves issued legal notice dtd:17/5/2014 to plaintiffs expressing their readiness to refund the amount subject to the terms and conditions of the agreement of sale. Instead of taking refund of the amount, plaintiffs have given reply to the said legal notice. 10 O.S.No.6091/2014 Thus, there is no default on the part of defendants to perform their part of contract as they co-operate with the plaintiffs till November, 2013. There is default on the part of plaintiffs to pay the balance consideration on the stipulated date. Thus, defendants are not liable to pay interest at 21% p.a. as claimed in the plaint. There is no cause of action for plaintiffs to file the suit as defendants were ready to execute the sale deed in favour of plaintiffs till 15/12/2013. Hence, prayed for dismissal of the suit with costs.
5. From the above facts, the following issues were framed:-
ISSUES
1. Whether plaintiffs prove that defendants defaulted the agreement to sell dtd:08/05/2013?
2. Whether defendants prove that plaintiffs defaulted the agreement to sell dtd:08/05/2013?
3. Whether plaintiff is entitled for interest at 21% p.a. as prayed in the plaint?
4. Whether plaintiff is entitled for suit claim?
5. What order or decree?11 O.S.No.6091/2014
6. On behalf of plaintiffs, the GPA Holder of plaintiffs is examined as P.W.1, got marked Ex.P.1 to Ex.P.10 and closed their side. On behalf of defendants, 1st defendant is examined as D.W.1, got marked Ex.D.1 to Ex.D.3 and closed their side.
7. Heard arguments of both sides.
8. Findings of this court on the above issues are:-
Issue No.1:- In Affirmative; Issue No.2:- In Negative; Issue No.3:- Partly in Affirmative; Issue No.4:- Partly in Affirmative; Issue No.5:- As per the final order for the following:-
REASONS ISSUE Nos.1 & 2
9. These issues are taken together as they require common discussion.
The admitted facts of the case are that 2nd plaintiff is the mother of 1st plaintiff; 2nd defendant is the mother of 1st defendant. Plaintiffs entered into agreement of sale 12 O.S.No.6091/2014 with defendants agreeing to purchase Flat No.003 in third and fourth floor of the property at Nandi Residency situated at BBMP Municipal No.16/9, Shakthi Ganapathy Nagar, 5th Cross, Bangalore. The defendants are owners of said property. Plaintiffs have paid Rs.17,00,000/- to defendants by way of advance through 2 cheques i.e., 1st cheque bearing No.323371 amounting to Rs.2,00,000/- dtd:9/5/2013 drawn on State Bank of Mysore, Wilson Garden Branch and 2nd cheque for Rs.15,00,000/- dtd:27/5/2013 drawn on ICICI Bank, Jayanagar Branch, Bangalore. It was agreed that plaintiffs shall pay Rs.68,50,000/-, the balance sale consideration amount before 30/08/2013 and defendants agreed to complete the construction by said date and hand over the property to plaintiffs. It is also not in dispute that 1st plaintiff is residing in USA and was in contact with 1st defendant regarding this transaction.
10. It is also not in dispute that 1st defendant assisted 1st plaintiff in obtaining loan to purchase flat from Axis Bank and Axis Bank rejected the loan application of 1st 13 O.S.No.6091/2014 plaintiff on the ground that there was technical deviation in the construction of the building.
11. 2nd plaintiff being the aged lady and 1st plaintiff being resided in USA have executed the GPA in favour of one Smt.Jyothi Jayanth as per Ex.P.1 and she has given evidence in this suit.
12. Learned counsel for defendants vehemently submitted arguments that this P.W.1 personally does not know the suit transaction and thus, she has no capacity to give evidence and hence, her evidence cannot be considered. In this regard, defendant's counsel has relied on the citation reported in Hon'ble Supreme Court of India in Civil Appeal No.147-148/2001 between "Man Kaur(dead) by Lrs & Hartar Singh Sangha", wherein, their lordships held as follows:-
"We may now summarise for convenience, the position as to who should give evidence in regard to matters involving personal knowledge:
14 O.S.No.6091/2014
(a) An attorney holder who has signed the plaint and instituted the suit, but has no personal knowledge of the transaction can only give formal evidence about the validity of the power of attorney and the filing of the suit.
(b) If the attorney holder has done any act or handled any transactions, in pursuance of the power of attorney granted by the principal, he may be examined as a witness to prove those acts or transactions. If the attorney holder alone has personal knowledge of such acts and transactions and not the principal, the attorney holder shall be examined, if those acts and transactions have to be proved.
(c) The attorney holder cannot depose or give evidence in place of his principal for the acts done by the principal or transactions or dealings of the principal, of which principal alone has personal knowledge.
(d) Where the principal at no point of time had personally handled or dealt with or participated in the transaction and has no 15 O.S.No.6091/2014 personal knowledge of the transaction, and where the entire transaction has been handled by an attorney holder, necessarily the attorney holder alone can give evidence in regard to the transaction. This frequency happens in case of principals carrying on business through authorised managers/attorney holders or persons residing abroad managing their affairs through their attorney holders.
(e) Where the entire transaction has been conducted through a particular attorney holder, the principal has to examine that attorney holder to prove the transaction, and not a different or subsequent attorney holder.
(f) Where different attorney holders had dealt with the matter at different stages of the transaction, if evidence has to be led as to what transpired at those different stages, all the attorney holders will have to be examined.
(g) Where the law requires or contemplated the plaintiff or other party to a proceeding, to establish or prove 16 O.S.No.6091/2014 something with reference to his 'state of mind' or conduct', normally the person concerned alone has to give evidence and not an attorney holder. A landlord who seeks eviction of his tenant, on the ground of his 'bona fide' need and a purchaser seeking specific performance who has to show his 'readiness and willingness' fall under this category.
There is however a recognized exception to this requirement. Where all the affairs of a party are completely managed, transacted and looked after by an attorney (who may happen to be a close family member), it may be possible to accept the evidence of such attorney even with reference to bona fides or 'readiness and willingness'. Examples of such attorney holders are a husband/wife exclusively managing the affairs of an old and infirm parent, a father/mother exclusively managing the affairs of a son/daughter living abroad."
17 O.S.No.6091/2014
13. In the above said citation, their Lordships held under what circumstances, the attorney holder can give evidence on behalf of parties to the suit. P.W.1 is none other than the sister of first plaintiff and daughter of second plaintiff and thus, come under the category of 'g' mentioned in the above said citation.
14. Defendant's counsel further relied on another judgment of Hon'ble High Court of Karnataka in W.P.No.20298/2014(GM-CPC) between "Nagarathna Murthy & Sri.S.Narayanappa(dead by LRs)", wherein their Lordships held as follows:-
"Thus, in the present case, the learned Judge shall allow GPA to 'act' on behalf of the plaintiff within the parameters as reflected in the aforementioned judgment of the Supreme Court and this court. In other words, it is open to GPA to act on behalf of the plaintiff. He may also examine himself as witness like any other witness, if he is so competent in law to testify the existence or non-existence of any fact in issue in the suit or proceedings or such other facts as are 18 O.S.No.6091/2014 declared to be relevant under the provisions of the Indian Evidence Act, if such facts are within his personal knowledge. In any case, he can not appear as a witness in place of principal or as a principal. As observed by the Supreme Court, the learned Judge while allowing the GPA to step into witness box like any other witness shall see to it that his deposition confines only to the acts done by him, in exercise of the power granted to him by virtue of the instrument. He may depose for the plaintiff in respect of such acts but he cannot depose for the principal for the acts done by the principal, and not by him. He cannot depose for the principal in respect of the matter, as regards which, only the principal can have personal knowledge and in respect of which, the principal is entitled to be cross-examined. Keeping all the principles in view, the learned Judge shall allow the GPA to produce power of attorney and 'act' on behalf of the plaintiff. Insofar as admissibility of any portion of his deposition, if he steps into the witness box, shall be considered on merits in accordance with law and in the light of the aforesaid 19 O.S.No.6091/2014 judgments and other judgments that will be cited by the parties."
15. In the above said citation, their Lordships held that what would be the evidentiary value attached to the evidence of GPA Holder i.e., the court has to assess the evidence of General Power of Attorney holder after verifying his knowledge about the facts of the case. With this background, the evidence of P.W.1 is to be looked into.
16. P.W.1 in her affidavit evidence has stated the case of plaintiffs in detail. In the cross-examination, she has deposed that she was all along present at the time of execution of the suit agreement and thus, P.W.1 is personally aware about the suit transaction.
17. The learned counsel for plaintiff submitted that though in the agreement it is stated that it was executed on 8/5/2013, but its stamp paper was purchased on 10/5/2013. Hence, P.W.1 is not personally aware about the suit transaction.
20 O.S.No.6091/2014
18. It is to be noted here that P.W.1 in her affidavit evidence at para No.6, has deposed that pursuant to that an agreement of sale was entered into by the plaintiffs and defendants on 8/5/2013.
19. Though the stamp paper was purchased on 10/5/2013, it is not in dispute between both parties that the agreement between parties was entered on 8/5/2013 and it is stated so in the plaint and it is not disputed by defendants in their written statement. Even P.W.1 was not cross-examined on this point. Hence, merely because, agreement was executed on 10/5/2013 and P.W.1 has deposed hat it was executed on 8/5/2013, it cannot be said that P.W.1 does not personally aware about the suit transaction.
20. P.W.1 was cross-examined in length by defendant's counsel, but in the said cross-examination, nothing was elicited to say that P.W.1 does not personally aware about the suit transaction. It is to be noted here that parties admitted the agreement of sale and that no issue is 21 O.S.No.6091/2014 framed regarding execution of said document; merely because, it is stated in the affidavit evidence of P.W.1 that Ex.P.1 was executed on 8/5/2013 instead of saying that it was executed on 10/5/2013; it cannot be said that P.W.1 has no personal knowledge about the suit transaction. Further, there is not even a suggestion by defendant's counsel to P.W.1 that she does not know the suit transaction. Hence, these 2 rulings are not helpful for defendants to prove that P.W.1 does not know the suit transaction.
21. P.W.1 has produced the e-mail conversation between plaintiff No.1 and defendant No.1 dtd:11/7/2013 as per Ex.P.8 and e-mail conversation between plaintiff No.1 and bank which e-mail was sent to 1st defendant as per Ex.P.9. As per Ex.P.9, 1st plaintiff had requested Axis Bank to hand over his personal documents to Mr.Manohar Nandi (1st defendant). He sent said e-mail on 25/7/2013 at 6.29 a.m. and he has sent the copy of e-mail to 1st defendant. Afterwards, 1st defendant had sent mail on 11/7/203 at 1:11 A.M. to 1st plaintiff wherein he has stated as follows:- 22 O.S.No.6091/2014
"Sudhir there is some slight technical deviation in the construction (double height living space) for which axis bank have rejected, whereas other banks can process, these technical deviations can be sorted out by Akrama & Sakrama Scheme by Govt. of Karnataka which is my responsibility. The payment what you have made can be refunded anytime. Call me when you free."
22. Thus, through this e-mail, defendant No.1 intimated plaintiff that there are some technical deviations in the construction of the building and only for that reason, Axis Bank rejected the loan application of 1st plaintiff and 1st plaintiff could approach other banks for loan and he has also stated that it is his responsibility to cure all these defects and he has also offered that he would refund the amount at any time.
23. In the cross-examination, D.W.1 admitted that officer of Axis Bank has inspected the building in question for sanctioning the loan to plaintiffs and after such inspection, Axis Bank rejected to sanction the loan on the ground that 23 O.S.No.6091/2014 there was technical deviation in construction of the building. He further admitted that there was excess construction compared to the approved sanction plan at the building in question. But, he volunteers that it was within the permissive limit and he cannot say that said construction was not within the permissive limit because he is new to this industry. He admitted that there was excess construction of one room compared to floor area ration (FAR). Hence, Axis Bank told that there are technical deviations in the building. He admitted about the issuance of e-mails to 1st plaintiff. He made only enquiries in Government Office to sort out the technical deviations through Akrama-Sakrama scheme. But he has not given any written application to any of the Department of Government. He further admitted that plaintiffs were waiting for corrections of technical deviations in the building in question with an intention to purchase the property.
24. This admission of D.W.1 in the cross-examination reveals that even though defendant No.1 offered that he 24 O.S.No.6091/2014 would refund the money; plaintiffs were interested in purchasing the property after corrections of technical deviations in the building and thus, if plaintiffs were awaiting for the action being taken by 1st defendants.
25. D.W.1 in the cross-examination further admitted that plaintiffs were in his contact and he suggested them to obtain loan from SBM. He also admitted that plaintiff sent filled application form to him through e-mail. D.W.1 has produced the said e-mail along with attachment as per Ex.D.1, Ex.D.1(a) & (b). In the Ex.D.1, 1st plaintiff had sent e-mail to D.W.1 to forward the scanned attachment to Nagaraj (Manager of SBM).
26. Ex.D.2 is another e-mail dtd:17/9/2013 sent by 1st plaintiff to 1st defendant along with attachments i.e., filled application form of 1st plaintiff. Thus, even on 16th & 17th of September 2013, plaintiffs were interested in purchasing the property in question and they were waiting for correction of technical deviations.
25 O.S.No.6091/2014
27. As per terms and conditions of Ex.P.2 - sale agreement, plaintiffs should pay the 2nd installment of Rs.68,50,000/- within 30/8/2013 and if they failed to make such payment, the plaintiffs shall pay 2% interest p.m. to the said amount from the date of agreement. The remaining sum of Re.1/- and Cover Car parking cost of Rs.1,50,000/- shall be paid at the time of registration. Thus, under this clause, plaintiffs ought to have made payment on or before 31/8/2013, but they could not make this payment before that date, because of technical deviation in the building and 1st defendant had taken responsibility that he would correct those deviations and he admitted that plaintiffs were waiting for such corrections. Under those circumstances, definitely nobody would come forward to make payment. It is to be noted here that there is no evidence produced by both parties on which date, defendants corrected those technical deviations. However, even then, plaintiffs come forward to purchase the property by obtaining loan from SBM and 26 O.S.No.6091/2014 1st plaintiff had sent the scanned copy of filled application to 1st defendant to submit the same to the bank.
28. There is no evidence produced by either party to say that what happened to said application given by plaintiff. Whether SBM granted the loan or rejected the loan application is not forthcoming from the evidence. There is no proper pleading also on this point.
29. It was suggested to D.W.1 that the result of said loan application given to SBM was not intimated to plaintiff No.1, but it was denied by D.W.1 and he has deposed that there were talks going on between plaintiff and bank Manager in that regard, but no evidence is produced in that regard and no pleadings of both parties on that point. P.W.1 was not cross-examined regarding this loan application to SBM. Hence, it is crystal clear that no evidence is produced on this aspect.
30. It is an admitted fact that on 7/5/2014, defendants sold the property in question to one Smt.Pankajakshi under registered sale deed and plaintiffs have produced its 27 O.S.No.6091/2014 certified copy as per Ex.P.6. It is the contention of plaintiffs that as on the date of execution of said sale deed, sale agreement between plaintiffs and defendants was in existence and even then, defendants sold the property to third parties. However, it is not the contention of defendants that during November, 2013 when plaintiff No.1 visited India, he orally cancelled the agreement of sale and hence, he sold the property in question to third parties during May, 2014.
31. To substantiate the above contention of defendants, they have also examined one broker as D.W.2.
32. D.W.2 was examined by defendants to say that agreement between plaintiffs and defendants was got cancelled by defendants during November, 2013 when plaintiff No.1 visited India. On perusal of over all oral evidence adduced by D.W.2, it is clear that D.W.2 has not signed any document to show that he was all along present at the time of execution of sale agreement between plaintiffs and defendants and even at the time of 28 O.S.No.6091/2014 talks for cancellation of the said agreement. P.W.1 was not cross-examined by defendant's counsel on this point.
33. D.W.1 in his affidavit evidence at para No.11 has stated that "plaintiffs were provided with additional time from 30/8/2013 to pay the balance sale consideration amount and it was the act of plaintiff himself to withdraw from the contract, the defendants were liable to refund 2% penal interest as well as 5% of the amount to be forfeited as on 3/11/2013 the date when the plaintiffs had orally withdrew from the contract".
34. In the cross-examination at para 28, D.W.1 reiterated that "during November, 2013 plaintiffs came to India and at that time, they have orally cancelled the agreement with me". However, according to defendants, there is no written document on this point. When a document was executed between parties in writing, then, it is to be cancelled only through writing. Oral cancellation of a written document is not permissible in law. Any amount of oral evidence on this point is also not admissible in law. 29 O.S.No.6091/2014
35. Even otherwise, cross-examination of D.W.2 said to be an independent witness reveals that he is not personally aware about what happened between plaintiffs and defendants after execution of Ex.P.2, because in para No.10, D.W.2 has deposed that there were talks between plaintiff No.1 and defendant No.1 in respect of balance amount up to August 2013, but he was not present in those talks and defendant No.1 informed him about these talks. This shows that evidence of D.W.2 on this point is hear say evidence.
36. In para No.11 of his cross-examination, D.W.2 denied the suggestion that defendants constructed the building exceeding approved plan and it was deviating from the approved plan. In para No.12, again he denied the suggestion that bank authorities refused to give loan to 1st plaintiff for purchasing the apartment on the ground that the building construction is deviated from the approved plan. But, as already discussed above, D.W.1 has already admitted this deviation in his cross-examination and he 30 O.S.No.6091/2014 also admitted that e-mail as per Ex.P.8 was sent by him to 1st plaintiff and in the said e-mail, 1st defendant himself categorically stated about this technical deviations. These facts establish that D.W.2 is not personally aware about the transaction that being took place between 1st plaintiff and 1st defendant after execution of Ex.P.2. Hence, his say that he was present at the time of cancellation of agreement during November, 2013 between 1st plaintiff and 1st defendant is also doubtful.
37. As discussed earlier, on 7/5/2014 defendants sold the property in question to third party without intimating plaintiffs. Even there was no cancellation of sale agreement at that point of time. Defendants got issued legal notice as per Ex.P.3 dtd:17/5/2014 i.e., only after execution of sale deed as per Ex.P.6 to third parties. Even though this legal notice was issued subsequent to execution of sale deed to third parties; it was not recited in the said legal notice. On the other hand, it is stated that during November, 2013 plaintiff No.1 visited India and intimated the defendants that they are unable to complete 31 O.S.No.6091/2014 the contract and defendant No.1 accepted the cancellation of agreement of sale. If really, these facts are true, there was no impediment for defendants to pay back the advance amount to plaintiffs immediately during November, 2013 or atleast at the time of issuance of this legal notice. They could have immediately refunded the advance amount by deducting charges which they have mentioned in Ex.P.2. However, inspite of doing so, from November, 2013 till execution of sale deed to third parties and even afterwards, defendants kept quiet and only afterwards, they got issued legal notice by canceling the sale agreement stating that they are ready to refund the amount after reducing the penal amount.
38. Learned counsel for defendant submitted arguments that as per Clause 2(b) of Ex.P.2, plaintiff ought to pay 2% interest p.m. on balance amount and thus, defendants are entitled for retaining Rs.8,07,33/- and as per Schedule 'G' at clause No.9 of Ex.P.2, they are also entitled for forfeiture of 5% of sale consideration amount in advance 32 O.S.No.6091/2014 amount amounting to Rs.4,35,000/- and thus, they are entitled to with held Rs.12,42,333/- and liable to refund only Rs.4,57,667/-.
39. If the say of Learned counsel for defendant is true, immediately, during November, 2013 itself, defendants could have refunded this Rs.4,57,667/- to plaintiffs, but they did not do so. Even if the terms of Ex.P.2 are read completely, plaintiffs could pay 2% interest p.m. only if they were going to purchase the flat in question. But, in the instant case, flat in question was not at all purchased by plaintiffs and an agreement of sale was not concluded in the sale deed. Hence, there is no question of withholding of Rs.8,07,333/- by defendants.
40. As far as Clause No.9 in schedule "G" of Ex.P.2 is concerned, in case of any breach from the plaintiffs, defendants are entitled to forfeit 5% of the sale consideration amount. However, as discussed earlier, admittedly there was technical deviation in the construction of the building by defendants and plaintiffs 33 O.S.No.6091/2014 were waiting for its correction and thus, there was no breach from plaintiffs and hence, defendants are not entitled to forfeit 5% of the sale consideration amount in advance amount as mentioned in Clause No.9 of Schedule "G" of Ex.P.2. Hence, this court holds that defendants are not entitled to withhold Rs.12,42,333/- as alleged in the written statement. Further defendants failed to prove that it is plaintiffs who have defaulted the sale agreement dtd:8/12/2013. On the other hand, plaintiffs have proved that it is defendants who have defaulted the agreement because there was technical deviation in constructing building in question. Furthermore, defendants have not claimed Set-off or Counter-Claim to withhold the said amount. Accordingly, issue No.1 is answered in Affirmative and issue No.2 is answered in Negative.
ISSUE No.3
41. Plaintiffs claim interest at 21% p.a. on the advance amount of Rs.17,00,000/- from the date of agreement till filing of the suit and even from the date of suit till realization.
34 O.S.No.6091/2014
42. In the reply to legal notice as per Ex.P.4, plaintiffs had demanded interest at 18% from the date of agreement, but in the suit they demanded 21% interest. Admittedly, there is no agreement between plaintiffs and defendants for payment of this interest at the time of refund of the advance amount. There is no condition stipulated condition in Ex.P.2 regarding refund of advance amount or for cancellation of the agreement by plaintiffs. Even otherwise, as transaction between plaintiffs and defendants is pertaining to purchase of a flat i.e., a commercial transaction and as there was default from defendants; it is their incumbent duty to refund the entire advance amount to plaintiffs at the earliest.
43. According to defendants, the plaintiffs cancelled the agreement during November, 2013, but defendants failed to prove said cancellation. It is to be noted here that even during July, 2013 itself, before due date for payment of 2nd installment, defendants were ready to refund the advance amount. These facts made it clear that plaintiffs 35 O.S.No.6091/2014 are entitled for interest only at 10% p.a. not from the date of agreement of sale but from the date of execution of sale deed by defendants to third parties i.e., from 7/5/2014 till filing of the suit and from date of suit till realization. Accordingly, Issue No.3 is answered Partly in Affirmative.
ISSUE No.4
44. In view of findings on issue Nos.1 to 3, this court holds that plaintiffs are entitled for the suit claim amount of Rs.17,00,000/- along with interest at 10% p.a. amounting to Rs.42,501/- from 7/5/2014 till filing of the suit, totally amounting to Rs.17,42,501/- and also entitled for 10% interest from the date of suit till realization. Accordingly, Issue No.4 is answered in Partly in Affirmative.
ISSUE No.5
45. In view of findings on issue Nos.1 to 4, this court proceeds to pass the following:-
36 O.S.No.6091/2014
ORDER Suit is partly decreed with costs against defendants for a sum of Rs.17,42,501/- with current and future interest at 10% p.a. on Rs.17,00,000/- from the date of suit till realization.
Defendants are jointly and severally liable to pay the suit claim.
(Dictated to the Judgment Writer, transcribed and computerized by her, corrected and then pronounced by me in the open Court on this the 13th day of January, 2017).
(K.B.GEETHA) XIX ADDL.CITY CIVIL & SESSIONS JUDGE, BANGALORE CITY.
ANNEXURE I. List of witnesses examined on behalf of :
(a) Plaintiffs side :
P.W.1 - Jyothi Jayanthi
b) Defendants' side :
D.W.1 - N.L.Manohar D.W.2 - A.Venkatachala II. List of documents exhibited on behalf of :
(a) Plaintiffs' side :
Ex.P.1 GPA
Ex.P.2 Sale agreement dtd:8/5/2013
37 O.S.No.6091/2014
Ex.P.3 Legal notice dtd:17/5/2014
Ex.P.4 Office copy of the reply notice
dtd:27/5/2014
Ex.P.5 Postal acknowledgement
Ex.P.6 Certified copy of the sale deed
dtd:7/5/2014
Ex.P.7 Encumbrance certificate
Ex.P.8 E-mail conversation between
plaintiff No.1 and defendant No.1
dtd:11/7/2013 at 1.11 a.m.
Ex.P.9 E-mail conversation between
plaintiff No.1 and bank
dtd:24/7/2013 at 11.21 p.m. and
reply to this on 25/7/2013 at 6.29
p.m.
Ex.P.10 Certificate U/S 65B of the Indian
Evidence Act.
(b) Defendants' side : -
Ex.D.1 E-mail dtd:16/9/2013 at 18.46.29
hours sent by 1st defendant to
D.W.1
Ex.D.1(a) & Attachments to Ex.D.1 e-mail
1(b )
Ex.D.2 Another e-mail dtd:17/9/2013 at
13.52.11 hours sent by 1st
defendant to D.W.1
Ex.D.3 Certificate u/s 65-B of Evidence Act
(K.B.GEETHA)
XIX ADDL.CITY CIVIL & SESSIONS JUDGE,
BANGALORE CITY.
GVU/-
38 O.S.No.6091/2014
13/1/2017
Judgment pronounced in open court
vide separate detailed judgment with the following operative portion:-
ORDER Suit is partly decreed with costs against defendants for a sum of Rs.17,42,501/- with current and future interest at 10% p.a. on Rs.17,00,000/- from the date of suit till realization.
Defendants are jointly and severally liable to pay the suit claim.
(K.B.GEETHA) XIX ADDL.CITY CIVIL & SESSIONS JUDGE, BANGALORE CITY.