Kerala High Court
K.N. Narasimha Shenoy vs Anie Jos Thaliath on 5 February, 2025
2025:KER:7041
RFA No. 437 of 2016
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IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE A. BADHARUDEEN
WEDNESDAY, THE 5TH DAY OF FEBRUARY 2025 / 16TH MAGHA, 1946
RFA NO. 437 OF 2016
AGAINST THE JUDGMENT AND DECREE DATED 30.01.2016 IN
O.S.NO.997 OF 2011 OF SUBORDINATE JUDGE'S COURT-II,
ERNAKULAM.
APPELLANT/1ST DEFENDANT:
K.N. NARASIMHA SHENOY,
AGED 75 YEARS, S/O. K.K.NARAYANA SHENOY,
KALARICKAL HOUSE, DOOR NO.XL/6803,
BEHIND PADMA THEATRE, KOCHI-682035.
BY ADVS.P.VISWANATHAN
SUNIL N.SHENOI
K.V.VINOD
RESPONDENTS/PLAINTIFFS AND 2ND DEFENDANT:
* 1 ANNIE JOS THALIATH, *(DIED)
W/O. JOS J.THALIATH, 43/333A,
CRYSTAL MANOR, CITIZEN ROAD,
ERNAKULAM NORTH P.O., KOCHI-18.
** 2 RANA J.THALIATH,
S/O. JOS J.THALIATH, 43/333A,
CRYSTAL MANOR, CITIZEN ROAD,
ERNAKULAM NORTH P.O., KOCHI-18.
** 3 JOS J.THALIATH,
AGED 64 YEARS, S/O. JOSEPH,
43/333 A, CRYSTAL MANOR,
CITIZEN ROAD, ERNAKULAM NORTH P.O.,
KOCHI-18.
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RFA No. 437 of 2016
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ADDITIONAL RESPONDENT NO.4 IMPLEADED
ADDL.R4 RENEE JOS THALIATH,
D/O JOS J. THALIATH, AGED 40 YEARS,
CRYSTAL MANOR, CITIZEN ROAD,
AYYAPPANKAVU, ERNAKULAM, PIN-682018
** IT IS RECORDED THAT RESPONDENTS 2 & 3 WHO ARE
ALREADY IN THE PARTY ARRAY ARE THE LEGAL
REPRESENTATIVES OF THE DECEASED 1ST RESPONDENT
AS PER ORDER DATED 15/3/2024 IN I.A.NO.3/2024.
* ADDITIONAL RESPONDENT NO.4 IS ALSO IMPLEADED
BEING THE OTHER LEGAL REPRESENTATIVE OF THE
DECEASED 1ST RESPONDENT AS PER ORDER DATED
15/3/2024 IN I.A.NO.3/2024
R2-R4 ADVS.K.C.CHARLES
M.POLY MATHAI
VIMAL K.CHARLES
THIS REGULAR FIRST APPEAL HAVING COME UP FOR HEARING
ON 28.01.2025, THE COURT ON 05.02.2025 DELIVERED THE
FOLLOWING:
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RFA No. 437 of 2016
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'C.R.'
JUDGMENT
Dated this the 5th day of February, 2025 Aggrieved by the judgment and decree in O.S.No.997/2011 on the files of the Subordinate Judge's Court-II, Ernakulam, the 1st defendant has preferred this appeal under Section 96 read with Order XLI Rule 1 of the Code of Civil Procedure, arraying the plaintiffs as well as the 2nd defendant as the respondents herein.
2. Heard the learned counsel for the 1st defendant and the counsel appearing for the plaintiffs in detail. Perused the pleadings and evidence in this matter.
3. The parties in this appeal will be referred to as 'plaintiffs', '1st defendant' and '2nd defendant' hereinafter for easy reference.
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4. The case put up by the plaintiffs before the trial court is as under;
The plaintiffs' case is that the 1st defendant agreed to sell the plaint schedule property, which he obtained on the strength of settlement deed No.1385/1970 of Ernakulam SRO, for a total consideration of Rs.22 lakhs, and an agreement in writing had been entered on 17.08.2001. The case of the plaintiffs further is that out of the sale consideration, Rs,21,78,750/- was paid in advance earlier and Rs.16,250/- more paid on the date of execution of the agreement, making a total sum of Rs..21,95,000/- paid as advance and it was agreed by the 1st defendant to execute the sale deed on paying Rs.5000/- towards balance consideration. Accordingly, the possession of the property was also handed over to the plaintiffs with right to take usufruct thereof. According to the plaintiffs, no period was fixed for executing the agreement and on 2025:KER:7041 RFA No. 437 of 2016 -5- 07.11.2011, the plaintiffs sent legal notice to the 1 st defendant demanding specific performance of the agreement. Though the same was accepted by the 1 st defendant, he refused to perform his part of contract, on receipt of notice. Accordingly, the present suit has been filed.
5. The 1st defendant entered appearance and filed written statement denying execution of the agreement and receipt of money as alleged in the agreement. According to him, the possession of the property also was not put under the plaintiffs and the building in the plaint schedule property was given on rent to the 2nd defendant much earlier. The further case put up by the defendants is that the 1 st defendant happened to avail loan of Rs.50,000/- from the 2 nd defendant in connection with his cattle feed business and the 2nd defendant insisted for issuance of blank signed stamp papers and blank signed papers towards security for the said loan from the 1 st defendant.
2025:KER:7041 RFA No. 437 of 2016 -6- Accordingly, he had given blank signed stamp papers and blank signed papers. Though he discharged the said liability and demanded the return of blank signed stamp papers and blank signed papers, he was informed that the said documents were missing. According to the defendants, the 2nd defendant and the plaintiffs colluded together and misused the blank signed stamp papers and signed blank papers and fabricated two agreements. According to the defendants, no agreement executed to grant decree of specific performance and even otherwise, the suit is barred by limitation.
6. On the above pleadings, the trial court raised the following issues;
"(1) Whether the suit is barred by the period of limitation?
(2) Whether the agreement dated 17.08.2001 was executed by 1st defendant as alleged?
2025:KER:7041 RFA No. 437 of 2016 -7- (3) Whether the plaintiffs paid a sum of Rs.22,00,000/- to the 1st defendant towards sale consideration of the plaint schedule property as claimed?
(4) Whether the plaintiffs had always been ready and willing to perform the contract?
(5) Whether the said agreement is a fabricated one as contended in the written statement?
(6) Whether the prayer for specific performance allowable?
(7) Whether the prayer for injunction allowable?
(8) Reliefs and costs?"
7. Thereafter, the trial court recorded evidence confined to that of PW1 and PW2, and Exts.A1 to A21 on the side of the plaintiffs. The 1st defendant got examined as DW1 and Exts.B1 to B4 were marked, on the side of the 1 st defendant.
2025:KER:7041 RFA No. 437 of 2016 -8- Exts.C1 and C2 also were marked. The trial court addressed the question of limitation and found that the suit is not barred by limitation. The trial court also addressed the evidence adduced by the plaintiffs to prove the execution of Ext.A1 agreement and the trial court found that Ext.A1 is a genuinely executed agreement and the execution was proved by the evidence of PW1 and PW2. The trial court also given much emphasis on receipt of Rs.5,000/- being balance consideration admitted by DW1 to hold that the plaintiffs are entitled to a decree for specific performance of Ext.A1 agreement and accordingly, the suit was decreed, granting the relief of specific performance of the contract as sought for, and also prohibitory injunction with costs.
8. The learned counsel for the 1 st defendant reiterated the contentions before the trial court. According to him, the suit is barred by limitation, the execution of Exts.A1 and 2025:KER:7041 RFA No. 437 of 2016 -9- A3 were not proved properly, non examination of the 2 nd defendant to prove the consideration and also the delay in filing the suit in 2011 after ten years were grounds to disbelieve the case of the plaintiffs and to non suit them. The learned counsel read out the depositions of PW1, PW2 and DW1 with reference to the recitals therein and the mode of payment of consideration to unsettle the trial court verdict.
9. The learned counsel for the plaintiffs resisted the contentions relying on the evidence of PW1 and PW2, DW1 as well as Ext.A16 in support of the verdict of the trial court.
10. Having heard so, the following points arise for consideration;
(1) Whether the trial court went wrong in holding that the suit is barred by limitation? (2) What is the period of limitation to file a suit for specific performance of contract?
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(3) Whether the trial court went wrong in
holding that the plaintiffs proved Ext.A1 agreement so as to grant the relief of specific performance of the same?
(4) Whether the decree and judgment would
require interference?
(5) Reliefs and costs.
11. Point No.1 :- According to the learned counsel for the 1st defendant, Ext.A1 is an agreement executed on 17.08.2001 and therefore, a suit to enforce the same should have been filed within three years and therefore, the suit is barred by limitation.
12. Reading Article 54 of the Schedule to the Limitation Act, the learned counsel for the plaintiffs resisted the contention and submitted that in view of the second limb of 2025:KER:7041 RFA No. 437 of 2016 -11- Article 54, the present suit is not at all barred since the time to file suit would start to run from the date of refusal of the agreement, as no time limit is fixed for execution of Ext.A1. The trial court also relied on Article 54 of the Schedule to the Limitation Act and held that the suit is not barred by limitation.
13. It is not in dispute that Article 54 of the Schedule to the Limitation Act deals with the period of limitation to file a suit for specific performance of contract. As per Article 54, the period for filing a suit for specific performance of contract is three years and the time from which the period begins to run is 'from the date fixed for performance or if no such date is fixed, when the plaintiff has notice that performance is refused.' In the instant case, as per Ext.A1, on getting the entire sale consideration, short of Rs.5,000/-, the possession also alleged to be parted with the plaintiffs undertaking to execute the sale deed without specifying any date for the same.
2025:KER:7041 RFA No. 437 of 2016 -12- According to the plaintiffs, while so, as on 18.10.2011, the plaintiffs issued Ext.A6 lawyer notice and the same was returned 'unserved'. Again the plaintiffs issued another notice on 07.11.2011 and Ext.A8 is the copy of the said lawyer notice, Ext.A9 is the postal receipt and Ext.A10 is the postal acknowledgement signed by the 1st defendant. Ext.A11 is the reply dated 12.12.2011 issued by the 1st defendant. Therefore, the refusal on the part of the plaintiffs and the 1 st defendant to execute Ext.A1 started on getting notice dated 07.11.2011 and accordingly, the case of the plaintiffs is that the cause of action for the suit arose on 09.11.2011. As per Article 54, the period to file a suit for specific performance of contract is three years and the time from which the period begins to run is 'from the date fixed for performance, when a date is fixed. If no such period is fixed, the time begins to run from when the plaintiff has notice that performance is refused.' Only exception to this general rule 2025:KER:7041 RFA No. 437 of 2016 -13- is in relation to contracts where time is fixed as the essence of contract with specific clause in the contract to be discernible from the contract with all the characteristics to hold that the time is fixed as the essence of contract in deviation from the general rule. Here no time is fixed for the performance of Ext.A1, therefore, the time to file a suit for specific performance of contract would start to run from the date when the plaintiff has noticed that performance has been refused. If so, the finding of the trial court that in the instant case, the suit is not barred by limitation is only to be justified.
14. Point Nos.2 to 5:- In this case, the plaintiffs' case is that as on 17.08.2001, the 1st defendant executed an agreement to sell the plaint schedule property for a total consideration of Rs.22 lakh. Out of the sale consideration, Rs.21,78,750/- was paid in advance earlier and Rs.16,250/- more paid on the date of execution of the agreement, making a total sum of Rs.21,95,000/-
2025:KER:7041 RFA No. 437 of 2016 -14- paid as advance and it was agreed by the 1 st defendant to execute the sale deed, on receiving balance sale consideration to the tune of Rs.5,000/-. Accordingly, the possession of the property was also handed over to the plaintiffs with right to take usufruct thereof. The further case of the plaintiffs is that the balance sale consideration after payment of Rs.21,95,000/- towards the agreed sale consideration, coming to Rs.5,000/-, was sent by the plaintiffs to the 1st defendant by postal money order on 28.09.2011 and the same was received by the 1st defendant on 29.09.2011. Therefore, the plaintiffs have performed their part and they are always ready and willing to perform their part of contract. Whereas the case of the 1 st defendant is that the 1 st defendant happened to avail loan of Rs.50,000/- from the 2 nd defendant in connection with cattle feed business and the 2 nd defendant insisted for issuance of blank signed stamp papers and blank signed papers towards security for such loan from the 2025:KER:7041 RFA No. 437 of 2016 -15- 1st defendant. Accordingly, he had given blank signed stamp papers and blank signed papers. Though he discharged the said liability and demanded back the blank signed stamp papers and blank signed papers, he was informed that the said documents were missing. According to the defendants, the 2nd defendant and the plaintiffs colluded together and misused the blank signed stamp papers and signed blank papers, and fabricated the agreements, produced as Exts.A1 and A3. Ext.A3 is another agreement allegedly executed on the same day permitting the plaintiffs to receive the rent from the 2nd defendant. According to the 1st defendant, no agreement was executed so as to grant decree of specific performance. In order to prove execution of Ext.A1 as well as Ext.A3, the 1st plaintiff got examined as PW1 and one Advocate Anilkumar C. got examined as PW2. The trial court relied on the evidence of PW1 and PW2, supported by the evidence given by DW1 admitting the fact that he had received 2025:KER:7041 RFA No. 437 of 2016 -16- Rs.5,000/- sent by money order towards balance sale consideration, understanding the fact from the money order form itself that the said amount was towards balance sale consideration.
15. In this case, PW2 is Advocate Anilkumar C. and his evidence is of subtle importance. He deposed that the drafts for Ext.A1 and Ext.A3 agreements were prepared by him. According to him, drafts for Exts.A1 and A3 agreements were requested to be prepared by the 1 st plaintiff and he prepared draft for the same though the fair agreements were not prepared by him. According to him, for the purpose of preparing the draft, a promissory note and the copy of the title deed were handed over and he had prepared the drafts of Ext.A1 and A3 after examining the documents. Although he was cross- examined to shake his version, during examination also, he supported the execution of Exts.A1 and A3 at his office. He had 2025:KER:7041 RFA No. 437 of 2016 -17- deposed before the trial court that on the date of execution of Exts.A1 and A3, the 1st defendant, the 2nd defendant and the 2nd plaintiff, who is the wife of the 2nd defendant and the 1st plaintiff were present along with the other witnesses. When a question was asked, who was the 2nd witness in Ext.A1, PW2 answered that he was the 2nd witness to Ext.A1. It is true that during cross- examination of PW1, he stated about handing over of Rs.6 lakh to the 2nd defendant. As per recitals in Ext.A1, out of the total consideration of Rs.22 lakh, the 2nd defendant received Rs.21,78,750/- as per the demand promissory note dated 30.07.2001 from the 2nd defendant, who is the husband of the 2nd plaintiff and the father of the 1st plaintiff in advance. That apart, from the date of execution of the agreement, Rs.16,250/- also was paid and the balance retained by the plaintiffs is Rs.5,000/-.
16. Even though the 1st defendant denied execution of Exts.A1 and A3 and his case is that Exts.A1 and A3 are 2025:KER:7041 RFA No. 437 of 2016 -18- documents fabricated by using his blank signed stamp papers and blank signed papers given by the 2nd defendant when he borrowed Rs.50,000/- from him during 2001, during cross- examination of DW1, he admitted that he had received Rs.5,000/- as money order and that though he received the amount, believing the same as rent, he had noticed from the money order form that the amount was towards sale consideration. The plaintiffs' case is that on the date of Ext.A1 agreement, Ext.A3 agreement also was executed so as to permit the plaintiffs to receive rent from the 2nd defendant and therefore, the payment of rent under the execution of Ext.A1 to the 1st defendant and 2nd defendant doesn't arise. In this connection, when DW1 was cross-examined, he stated that he did not receive any rent after the execution of Ext.A3 and the 2 nd defendant did not give any rent thereafter. After stating so, his version further is that there was payment of rent till July 2010 2025:KER:7041 RFA No. 437 of 2016 -19- and he had tendered Ext.B1 to prove the same. The trial court disbelieved Ext.B1 since the names of other tenants were not shown therein and held that Ext.B1 is created for the purpose of this case. Having considered the facts of this case, the finding of the trial court as regards to Ext.B1 is only to be justified.
17. It is relevant to note that Ext.A16 is the deposition given in RCP No.57/2011 filed by the 1 st defendant against the 2nd defendant seeking enhancement of rent. As per Ext.A16, he deposed that he had conducted the cattle feed business upto 1972 and not thereafter. But in this case, the contention now advanced by the 1st defendant is that he borrowed Rs.50,000/- from the 2nd defendant during 2001 for cattle feed business. In view of the vital material contradictions in the versions of DW1, the learned counsel for the plaintiffs fervently argued that the evidence given by DW1 is not at all believable. In the instant case, on perusal of Exts.A1 and A3, it 2025:KER:7041 RFA No. 437 of 2016 -20- could be gathered that these are documents normally written and signed by the parties, as deposed by PW1 and PW2. In fact, the execution of Exts.A1 and A3 is proved by the evidence of PW1 and PW2 and the same is fortified by the evidence of DW1 admitting that he had received Rs.5,000/- sent by money order towards balance sale consideration on noticing the same from the money order form itself that the said amount was towards balance sale consideration. In fact, on receipt of balance consideration to the tune of Rs.5,000/- with the said knowledge, no steps were taken by the defendants to return the money or send a notice intimating that he received the amount towards rent. That apart, Ext.A3 would show that no rent is payable to the 1st defendant after the execution of Exts.A1 and A3 and therefore, the likelihood of sending Rs.5,000/- towards rent itself is an impossibility.
18. In the instant case, the execution of Exts.A1 and 2025:KER:7041 RFA No. 437 of 2016 -21- A3 was proved by the evidence of PW1 and PW2 supported by DW1 and therefore, there is no reason to disbelieve the case. Once execution of a contract for sale is proved prior to amendment of the Specific Relief Act, the court has the discretion either to grant the discretionary relief for the performance of contract or in the alternative, to order return of the advance money.
19. Since the learned counsel for the appellant failed to justify interference with the trial court verdict regarding proof of Exts.A1 and A3, the learned counsel pressed for altering the verdict by granting return of advance money, and denying the discretionary relief for specific performance.
20. It is the settled law that when the plaintiff has been ready and willing to execute his part of the contract, which is proved, the court has discretion to grant the relief itself. It is equally well settled that the discretionary power shall not be 2025:KER:7041 RFA No. 437 of 2016 -22- exercised in an arbitrary manner and the same shall be exercised in accordance with sound and reasonable judicial principles. Section 20 of the Specific Relief Act, prior to its amendment with effect from 01.08.2018 stipulated that the jurisdiction to decree specific performance is discretionary, and the court is not bound to grant such relief merely because it is lawful to do so.
21. In the instant case, it is well discernible that on the date of execution of Ext.A1, the balance outstanding towards sale consideration was Rs.21,250/- and Rs.21,78,750/- was paid in advance earlier. Further, on the date of execution, Rs.16,250/- more also was paid towards sale consideration and the balance was a scanty sum of Rs.5,000/-, which was also paid and accepted by the 1st defendant, as already discussed. In such a case, the trial court exercised its discretion without any arbitrariness, applying sound principles and the said verdict is 2025:KER:7041 RFA No. 437 of 2016 -23- not liable to be interfered.
22. To sum up, it is held that the verdict under challenge does not require any interference.
23. In the result, this appeal fails and is accordingly dismissed. Resultantly, the decree and judgment of the trial court are confirmed.
24. Regarding cost, considering the facts of this case, there is no reason to disallow the cost of the plaintiffs/respondents. Therefore, cost also is allowed to be realised from the 1st defendant/appellant throughout the proceedings.
25. The interim stay granted in this case shall stand vacated.
26. All pending interlocutory applications in this appeal are dismissed accordingly.
2025:KER:7041 RFA No. 437 of 2016 -24- Registry is directed to forward a copy of this order to the trial court for information and further steps.
Sd/-
A. BADHARUDEEN JUDGE bpr 2025:KER:7041 RFA No. 437 of 2016 -25- APPENDIX OF RFA 437/2016 RESPONDENTS' ANNEXURES Annexure R3(A) A TRUE COPY OF THE SLP 5616/2012 FILED BEFORE THE HONOURABLE SUPREME COURT OF INDIA