Bangalore District Court
Arogya Swamy P vs Victor Arj J Alias J V Raj Alias J Victor ... on 3 June, 2025
1
O.S. No.8860/2018
KABC010342032018
C.R.P.67 Govt. of Karnataka
Form No.9 (Civil)
Title Sheet for
Judgments in Suits
(R.P.91)
TITLE SHEET FOR JUDGMENTS IN SUITS
IN THE COURT OF THE XL ADDL. CITY CIVIL &
SESSIONS JUDGE AT BENGALURU CITY : (CCH-41)
::Present::
Smt. Veena N., B.A.L. L.L.B.,
XL Addl. City Civil & Sessions Judge,
Bengaluru City.
Dated this 03rd day of June, 2025.
O.S. No.8860/2018
PLAINTIFF :: Sri. P.Arogya Swamy, Aged 65 years,
S/o. Late. Sri. R.Papanna, R/at: No.10,
Kanakadasa Layout, Lingarajpuram,
St. Thomas Town Post, Bengaluru - 560 084.
(By Sri. R.Vidhyasagar, Advocate)
V/s.
DEFENDANT :: Sri. J.Victor Raj @ J.V.Raj @ J.Victor R.,
Aged about 48 years, S/o. Late. A.James,
R/at: No.389, II Main, Byraveshwara Layout,
Hennur Bande, Bengaluru - 560 043.
(By Sri. R.Dayala Murthy, Advocate)
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O.S. No.8860/2018
Date of Institution of the :: 10-12-2018
Suit
Nature of the Suit :: MONEY SUIT
Date of commencement of :: 02-07-2021
recording of evidence
Date on which the :: 03-06-2025
Judgment was pronounced
Total Duration :: Year/s Month/s Day/s
06 05 24
(VEENA N.)
XL Addl. City Civil & Sessions Judge,
Bengaluru City.
JUDGMENT
Suit is one for recovery of Rs.5,75,000/- with interest at the rate of 12% p.a. from the date of suit till its realization.
2. Case of the plaintiff in brief is as hereunder:-
The plaintiff and defendant are friends and are well known to each other from past several years. Due to the said acquaintance, the defendant developed cordial relationship with plaintiff. The defendant is a real estate 3 O.S. No.8860/2018 agent and in order to establish and develop his business, he approached the plaintiff seeking hand loan of Rs.60,000/- agreeing to return the same within one year with 12% interest per annum. The plaintiff paid Rs.60,000/- by way of cheque drawn on Vijaya Bank, HBR Layout Branch, Bengaluru. Again in the first week of August 2016, the defendant approached the plaintiff and sought for financial assistance of Rs.5,00,000/- as there was some medical exigency in his family. Hence, on humanitarian grounds the plaintiff paid a sum of Rs.3,00,000/- by way of two cheques for a sum of Rs.1,00,000/- and Rs.2,00,000/- respectively drawn on Vijaya Bank, HBR Layout, Bengaluru. Again in the month of October 2016, the defendant approached the plaintiff and sought for loan of Rs.1,00,000/- and the plaintiff lent Rs.1,00,000/- to the defendant and thus in all the plaintiff paid Rs.4,60,000/- to the defendant and the defendant had agreed to return the entire loan amount within 2 months. After expiry of 2 months, the 4 O.S. No.8860/2018 plaintiff approached the defendant and demanded for repayment of hand loan of Rs.4,60,000/-. But the defendant on one or the other pretext dragged the matter. The defendant came to know that the plaintiff has entered into Joint Development Agreement with third party was cancelled and he being in real estate business mesmerized the plaintiff by promising that he will bring builders and developers to develop the property of the plaintiff. The defendant never kept up his word and he dodged the issue of making payment or getting developers on one or the other pretext and instead of repaying the loan amount he filed a false complaint against the plaintiff before jurisdictional police. Hence, the plaintiff issued legal notice on 30.08.2018 calling upon the defendant to return the loan amount and the defendant has though acknowledged the receipt of notice has issued an untenable reply. Inspite of receipt of notice, since the defendant failed to make payment, left with no choice the present suit is filed. 5
O.S. No.8860/2018
3. In pursuance to the summons issued, the defendant caused appearance and filed written statement wherein which it is contended that the plaintiff is only a customer of the defendant and he came to know the plaintiff through his colleague Mr. Uday Kumar who brought to the knowledge of this defendant that the plaintiff is the owner of property bearing khata Nos.27/3, 28/1 & 28/2 and the plaintiff offered to give the said property for Joint Venture. The defendant has an established business and there was no need for him to ask for hand loan from the plaintiff and he has not at all taken any loan from anybody. It is stated that the plaintiff requested the defendant and his colleague Mr. Uday Kumar to arrange a prospective builder to put up construction in his property and this defendant and his colleagues out of their best efforts have arranged for a builder. The defendant and his colleagues inspected the property and finally they brought one Mr. Basheer Ahmed Imran who is the proprietor of M/s. Capital 6 O.S. No.8860/2018 Projects to the plaintiff and they discussed at length and finally entered into Joint Development Agreement on 05.08.2016 and the plaintiff also executed G.P.A. in favour of builder.
4. Before arranging the builder to put up construction in joint venture the plaintiff assured to pay Rs.5,00,000/- towards service charges. As such, the defendant has arranged and procured builder. At the time of execution and registration of joint development agreement and G.P.A., the plaintiff issued cheque to the defendant towards service charges. The job of the defendant and his colleagues completed after execution and registration of joint development agreement. The plaintiff has not paid sum of Rs.4,60,000/- as hand loan and on the other hand, it was paid towards the charges for the service rendered by the defendant. This defendant is not at all aware of the cancellation of joint development agreement and he is not liable to refund the service charges to the plaintiff, since the defendant 7 O.S. No.8860/2018 already rendered service to the plaintiff by procuring prospective builder to the plaintiff. The plaintiff along with goonda elements demanded the defendant to repay the service charges paid to him and hence, the defendant lodged complaint against the plaintiff. It is stated that construction is not carried out for the reasons best known to the plaintiff and the said builder. The plaintiff instead of demanding the builder to carry out the construction work, is making hectic efforts in demanding the defendant to return the service charges amount taken for the services rendered by the defendant and it is not fair to demand the service charges paid by the plaintiff. It is stated that the intention of the plaintiff is to spoil the reputation and tarnish the image of defendant in the real estate market and the defendant has suffered mental agony and cardiac arrest and has incurred huge expenses towards his treatment and has sustained heavy loss in real estate business. Since the amount received by the defendant is towards the service 8 O.S. No.8860/2018 charges paid by the plaintiff, the defendant is not liable to refund the service charges amount and instead the plaintiff himself is liable to pay Rs.40,000/- and liable to pay Rs.10,00,000/- towards damages and loss sustained by the defendant and contending these facts sought for dismissal of suit.
5. The aforesaid pleadings have occasioned following ;
ISSUES
1. Whether plaintiff proves that defendant has taken loan of Rs.4,60,000/- on various dates as pleaded ?
2. Whether plaintiff proves that defendant has committed default in repaying the loan amount ?
3. Whether the plaintiff is entitled for relief sought ?
4. What order or decree ?
6. In order to establish his case, the plaintiff got examined himself as P.W.1 and relied upon 4 documents marked at Ex.P.1 to Ex.P.4 and closed the evidence. 9
O.S. No.8860/2018
7. The defendant got examined as D.W.1 and has relied upon 9 documents marked at Ex.D.1 to Ex.D.9 and closed the evidence.
8. Heard learned counsel for the plaintiff and defendant. Perused records.
9. My answers to the above issues are as follows:
ISSUE NO.1 :: In the Affirmative
ISSUE NO.2 :: In the Affirmative
ISSUE NO.3 :: Partly in the Affirmative
ISSUE NO.4 :: As per final order for the
following;
REASONS
10. ISSUES NO.1 TO 3 :: All these issues are taken up collectively for common discussion to avoid repetition of facts and also for convenience of the Court.
The present suit is one recovery of Rs.5,75,000/- with interest at the rate of 12% p.a. from the date of suit 10 O.S. No.8860/2018 till its realization. According to the plaintiff, the defendant in order to meet out his needs approached the plaintiff seeking financial assistance and since the defendant was well acquainted to the defendant, out of cordiality and humanity, the plaintiff lent loan of Rs.4,60,000/- on various dates as mentioned in the plaint and thereafter, he did not repay the loan amount of Rs.4,60,000/- as agreed by him within 2 months and instead lodged a complaint against the plaintiff before the jurisdictional police, when the plaintiff demanded for repayment of the loan amount and hence the suit.
11. On the contrary, the defendant has seriously disputed the alleged loan transaction and it is his contention that the plaintiff had requested the defendant to look for a builder to put up construction and develop his property and since the defendant was into real estate business he procured the builder and they entered into joint development agreement and the plaintiff had agreed to pay Rs.2,00,000/- towards service charges 11 O.S. No.8860/2018 and he paid Rs.4,60,000/- on various dates towards the service charges rendered by the defendant and his colleague and the plaintiff is still due of Rs.40,000/- and since the amount is towards service charges he is not liable to repay the amount.
12. So now the issue that needs to be adjudicated is as to whether the alleged transaction between the plaintiff and the defendant is a loan transaction or it was paid by the plaintiff as charges towards service rendered by the defendant. So the initial burden is upon the plaintiff to establish the alleged loan transaction. In order to discharge the same, the plaintiff got examined himself as P.W.1 and he has in his evidence deposed that the defendant had a very cordial relationship with him and he was running a real estate business and he obtained hand loan of Rs.60,000/- from plaintiff agreeing to repay the same within one year with interest at the rate of 12% p.a. and the said amount was paid by the plaintiff by way of cheque drawn on Vijaya 12 O.S. No.8860/2018 Bank, HBR Layout in favour of the defendant. Subsequently, the defendant approached the plaintiff seeking financial assistance Rs.5,00,000/- and on humanitarian grounds the plaintiff paid Rs.3,00,000/- by way of two cheques for a sum of Rs.1,00,000/- and Rs.2,00,000/- respectively drawn on Vijaya Bank, HBR Layout Branch, Bengaluru and again in the month of October 2016, in order to meet out his financial prices he requested the plaintiff for hand loan and the defendant paid a sum of Rs.1,00,000/- by way of cheque to the plaintiff and thus, in all the plaintiff paid Rs.4,60,000/- to the defendant by way of cheque. Thereafter, the defendant did not keep up his promise and he did not make payment as agreed and he dragged the matter on one or the other pretext. The defendant came to know that the joint development agreement entered into by the plaintiff with third party was cancelled and since he was in real estate business he promised to procure builders and developers to 13 O.S. No.8860/2018 develop his property and the defendant could get monetary benefits and though the plaintiff accepted the same, the defendant never kept his word and has dodged the issue on making payment or getting developers to develop his property and the plaintiff waited for reasonable time and after coming to know about the intention of the defendant of defrauding him, he demanded for repayment of loan amount and the defendant filed false complaint against him. Hence, the plaintiff issued legal notice and the defendant issued untenable reply denying his claim and hence, the present suit is filed.
13. In support of his evidence P.W.1 has relied upon Ex.P.1 which is the account statement of plaintiff maintained at Vijaya Bank, HBR Layout, Bengaluru for the period 08.08.2015 to 22.10.2016 which shows the payment of Rs.60,000/- by the plaintiff to the defendant by way of cheque on 14.12.2015, Rs.1,00,000/- by way 14 O.S. No.8860/2018 of cheque on 09.08.2016, Rs.2,00,000/- by way of cheque on 23.08.2016 and Rs.1,00,000/- by way of cheque on 21.10.2016. So this statement shows the payment of Rs.4,60,000/- by the plaintiff to the defendant on various dates. Ex.P.2 is the legal notice 18.09.2018 issued by the plaintiff calling upon the defendant to make payment of Rs.4,60,000/- within the time stipulated and he has in detail narrated the various dates on which the payment was made and the purpose for which the defendant had taken hand loan from the plaintiff and sought for repayment of the amount. Ex.P.2(a) and (b) are the postal receipt and postal acknowledgment which proves the factum of issuance and service of legal notice on the defendant. Ex.P.3 is the reply notice issued by the defendant on 24.09.2018 wherein which he has denied the contents of the notice and has raised a defense that the amount of Rs.4,60,000/- was paid towards the service rendered by the plaintiff in procuring the builder for development of 15 O.S. No.8860/2018 the property of the plaintiff and he is not liable to pay the amount and instead the plaintiff is due for Rs.40,000/- and has sought for payment of Rs.10,40,000/- towards the damages and the loss suffered by the defendant.
14. During cross-examination of P.W.1, he has categorically denied all the suggestions putforth that the plaintiff approached Mr. Uday Kumar who is an agent and expressed his intention to execute joint venture agreement and the said Uday Kumar approached the defendant to refer any builders and the defendant arranged one Basheer Ahmed as builder to his property and they entered into joint development agreement. But P.W.1 volunteers that though the joint venture agreement is executed it was not through the defendant. The other suggestions putforth that after the cancellation of the said joint venture agreement the plaintiff again approached the defendant to make arrangement for a builder is denied and he admits that he again entered into a registered agreement with one Mr. Moinuddin who 16 O.S. No.8860/2018 is also a builder. The suggestion putforth that he has given Rs.4,60,000/- toward the service rendered by the defendant and the said amount was paid at the time of execution of joint development agreement by way of cheque is denied. So P.W.1 denies that the amount was paid towards the service charges and he says the joint development agreement was entered with Space Solutions but it was not through the defendant. P.W.1 admits that the defendant has signed as a witness to the joint development agreement and P.W.1 says since he was along with him his signature was taken and he gave the amount as a loan and not as service charges. So the evidence of P.W.1 shows he has consistently deposed that the amount was paid as a hand loan and has not as a commission charges to the defendant and he though admits the execution of the first joint development agreement with one Basheer Ahmed Imran and it was cancelled subsequently and he though the admits that the second joint development agreement was entered 17 O.S. No.8860/2018 with space solutions, he denies that the defendant acted as a agent and he procured the builder.
15. On the contrary, the defendant got examined himself as D.W.1 and he has in his evidence deposed that the plaintiff is only a customer of the defendant and he came to know the plaintiff through his colleague Mr. Uday Kumar who brought to the knowledge of this defendant that the plaintiff is the owner of property bearing khata Nos.27/3, 28/1 & 28/2 and the plaintiff offered to give the said property for Joint Venture. The defendant has an established business and there was no need for him to ask for hand loan from the plaintiff and he has not at all taken any loan from anybody. It is stated that the plaintiff requested the defendant and his colleague Mr. Uday Kumar to arrange a prospective builder to put up construction in his property and this defendant and his colleagues out of their best efforts have arranged for a builder. The defendant and his colleagues inspected the property and finally they 18 O.S. No.8860/2018 brought one Mr. Basheer Ahmed Imran who is the proprietor of M/s. Capital Projects to the plaintiff and they discussed at length and finally entered into Joint Development Agreement on 05.08.2016 and the plaintiff also executed G.P.A. in favour of builder.
16. Before arranging the builder to put up construction in joint venture the plaintiff assured to pay Rs.5,00,000/- towards service charges. As such, the defendant has arranged and procured builder. At the time of execution and registration of joint development agreement and G.P.A., the plaintiff issued cheque to the defendant towards service charges. The job of the defendant and his colleagues completed after execution and registration of joint development agreement. The plaintiff has not paid sum of Rs.4,60,000/- as hand loan and on the other hand, it was paid towards the charges for the service rendered by the defendant. This defendant is not at all aware of the cancellation of joint 19 O.S. No.8860/2018 development agreement and he is not liable to refund the service charges to the plaintiff, since the defendant already rendered service to the plaintiff by procuring prospective builder to the plaintiff. The plaintiff along with goonda elements demanded the defendant to repay the service charges paid to him and hence, the defendant lodged complaint against the plaintiff. It is stated that construction is not carried out for the reasons best known to the plaintiff and the said builder. The plaintiff instead of demanding the builder to carry out the construction work, is making hectic efforts in demanding the defendant to return the service charges amount taken for the services rendered by the defendant and it is not fair to demand the service charges paid by the plaintiff. It is stated that the intention of the plaintiff is to spoil the reputation and tarnish the image of defendant in the real estate market and the defendant has suffered mental agony and cardiac arrest and has incurred huge expenses towards his treatment and has sustained 20 O.S. No.8860/2018 heavy loss in real estate business. Since the amount received by the defendant is towards the service charges paid by the plaintiff, the defendant is not liable to refund the service charges amount and instead the plaintiff himself is liable to pay Rs.40,000/- and liable to pay Rs.10,00,000/- towards damages and loss sustained by the defendant and contending these facts sought for dismissal of suit.
17. In support of his evidence he has relied upon Ex.D.1 and Ex.D.2 which are the registered JDA dated 05.08.2016 and G.P.A. dated 05.08.2016 and Ex.D.3 is the Deed of Cancellation dated 05.08.2016 and these documents shows the plaintiff has entered into the said agreement with M/s. Capital Projects for the purpose of developing the property belonging to the owners subject to the terms and conditions stipulated therein and it also shows the defendant is one of the witness to the said agreement. Ex.D.2 is the G.P.A. executed by the plaintiff 21 O.S. No.8860/2018 in favour of the said builder on the same day empowering him to do all the acts mentioned therein and again the defendant is one of the witness to the said document. Ex.D.3 shows the said joint development agreement came to be cancelled with mutual discussions and they considered to not to proceed with the proposed development of the schedule property. Ex.D.4 is the second joint development agreement entered by the plaintiff with M/s. Space Solutions in respect of the property for the purpose of development of his property and the defendant is not a signatory to this document. Ex.D.5 is the Encumbrance Certificate which shows the execution of the second joint development agreement in favour of M/s. Space Solutions and also the earlier agreement entered into by the plaintiff with M/s. Capital Projects. Ex.D.6 and Ex.D.7 are the legal notice and the reply notice issued by the exchange to the plaintiff and defendant which is discussed herein before.
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18. So relying on these documents D.W.1 claims that it was not a loan transaction and the amount was paid towards the service rendered by him. During cross- examination of D.W.1, he says the plaintiff was not known to him and he was introduced by one Uday Kumar in the year 2016 before entering into JDA and denies that in the year 2015 a sum of Rs.60,000/- was transferred from the account of plaintiff and denies all the suggestion that he used to obtain loan from the plaintiff and he had loan transaction from the plaintiff and the amount of Rs.4,60,000/- was paid as hand loan. He admits that he has not issued any receipt to show the said amount Rs.4,60,000/- was issued towards service charges and D.W.1 says the said amount is towards his service charges and the plaintiff is still due for Rs.40,000/-. D.W.1 in his cross-examination categorically admits that the payment of Rs.60,000/- on 14.12.2015, Rs.1,00,000/- on 09.08.2016, Rs.2,00,000/- on 23.08.2016 and Rs.1,00,000/- on 21.10.2016 and he 23 O.S. No.8860/2018 has received Rs.4,60,000/- and he also admits that after 21.10.2016 there was no transaction between them and at the time of entering into second JDA the present suit was still pending for consideration and he did not insist the plaintiff to pay balance of Rs.40,000/- and to with draw the present suit.
19. D.W.1 volunteers even under the second JDA he did not pay the amount as agreed and the plaintiff has cheated him. D.W.1 admits that he has not entered into any agreement with plaintiff towards payment of service charges under second JDA and the suggestion putforth that he was not entitled for any service charges and no agreement was entered into between them and he is liable to pay Rs.4,60,000/- to the plaintiff are all categorically denied by D.W.1.
20. On analysis of the oral and documentary evidence relied upon by both the parties, it is evident that the plaintiff being the owner of the property bearing 24 O.S. No.8860/2018 khata Nos.27/3, 28/1 & 28/2 situated at Lingarajapuram Village, Kasaba Hobli, Bengaluru North Taluk measuring East to West 60 ft. and North to South 50 ft. has entered into JDA as per Ex.D.1 with M/s. Capital Projects represented by its proprietor Basheer Ahmed Imran on 05.08.2016 for the purpose of development of his property. No doubt, as admitted by the plaintiff in his cross-examination defendant is one of the witnesses to Ex.D.1 and also the G.P.A. and Ex.D.2. The said JDA was executed on 05.08.2016. So relying on these documents, the defendant has raised a defense that since he procured the service of builder towards his service charges the amount of Rs.4,60,000/- was paid by the plaintiff. As per admission of D.W.1, he has not entered into any agreement with the plaintiff in respect of the commission charges and his own admission shows he has not issued any receipt to the plaintiff for having received the amount towards his service charges. Further as stated earlier, Ex.D.1 is executed on 25 O.S. No.8860/2018 05.08.2016 and the account statement Ex.P.1 shows a sum of Rs.60,000/- is paid on 14.12.2015 i.e. much prior to the execution of Ex.D.1 and a sum of Rs.1,00,000/- is paid on 09.08.2016 and Rs.2,00,000/- on 23.08.2016 and Rs.1,00,000/- on 21.10.2016 and these payments are made subsequent to the execution of JDA. No doubt, Ex.D.3 shows the said JDA is cancelled on 01.03.2021. It is the contention of the defendant that for the reasons best known to the parties the JDA is cancelled and hence, the defendant is not liable to refund the amount. It is necessary to note that, the suit is filed in the year 2018 and the Deed of Cancellation is executed in the year 2021. So this shows the plaintiff is not seeking for refund of service charges on account of cancellation of the JDA and the final transaction between the parties is on 21.10.2016 and even after issuance of notice in the year 2018, since the defendant did not repay the amount the suit is filed. Ex.P.1 clearly demonstrates the date on which the payments are all 26 O.S. No.8860/2018 made which are also admitted by D.W.1 in his cross- examination. So none of these documents establishes that the amount was paid towards the service charges. When the account statement establishes the payment of amount to the defendant, the plaintiff has discharged the burden of proving loan transaction and the onus of proof was upon the defendant to establish that the amount was paid towards his service charges. But absolutely no document is forthcoming to establish the same. Hence, the defendant has failed in establishing that the amount so paid was towards his service charges. On the contrary, the plaintiff has established that the defendant has taken loan of Rs.4,60,000/- on the dates mentioned therein and has committed default in repay the loan amount and as such, the plaintiff is entitled for the relief claimed. So far as the interest is concerned, plaintiff is claiming interest at the rate of 12% p.a. But there is no document to prove the contractual rate of interest between the parties. Since the said transaction is not a 27 O.S. No.8860/2018 commercial transaction, it is considered just and proper to award interest at the rate of 6% p.a. Thus in view of the aforesaid reasoning, this Court proceeds to answer the Issues No.1 & 2 in the Affirmative and Issue No.3 Partly in the Affirmative.
21. ISSUE NO.4 :: In view of findings on issues No.1 to 3, this Court proceeds to pass the following:-
ORDER Suit of the plaintiff is decreed in part with costs.
The defendant is liable to repay Rs.4,60,000/- with interest at the rate of 6% p.a. from the date of suit till its realization.
Draw decree accordingly.
(Dictated to the Stenographer, transcribed by her, transcription corrected and then pronounced by me in the open Court on this 03rd day of June, 2025).
(VEENA N.) XL ADDL. CITY CIVIL & SESSIONS JUDGE, BENGALURU CITY.28
O.S. No.8860/2018 ANNEXURE I. LIST OF WITNESSES EXAMINED ON BEHALF OF:
(A) PLAINTIFF SIDE :: P.W.1 :: P.Arogya Swamy (B) DEFENDANT SIDE :: D.W.1 :: J.Victor Raj
II. LIST OF DOCUMENTS EXHIBITED ON BEHALF OF:
(A) PLAINTIFF SIDE :
Ex.P.1 :: Statement of account
Ex.P.2 :: Legal notice
Ex.P.2(a) :: Postal receipt
Ex.P.2(b) :: Postal acknowledgment
Ex.P.3 :: Reply notice
Ex.P.4 :: Endorsement dated 31.07.2018
(B) DEFENDANT SIDE ::
Ex.D.1 :: Certified copy of registered joint development
agreement dated 05.08.2016
Ex.D.2 :: Certified copy of registered G.P.A. dated
05.08.2016
Ex.D.3 :: Certified copy of deed of cancellation dated
05.08.2016
Ex.D.4 :: Certified copy of development agreement dated
01.03.2021
Ex.D.5 :: Encumbrance Certificate
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Ex.D.6 :: Copy of legal notice dated 17.07.2018
Ex.D.7 :: Copy of notice dated 18.09.2018
Ex.D.8 :: Reply notice dated 28.04.2018
Ex.D.9 :: Returned RPAD cover
(VEENA N.)
XL ADDL. CITY CIVIL & SESSIONS JUDGE,
BENGALURU CITY.