Madras High Court
Parvathi vs Gowri Meena on 7 April, 2017
Author: C.V.Karthikeyan
Bench: C.V.Karthikeyan
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 07.04.2017
RESERVED ON: 16.03.2017
PRONOUNCED ON: 07.04.2017
CORAM
THE HONOURABLE MR.JUSTICE C.V.KARTHIKEYAN
AS(MD)No.266 of 2008
Parvathi
Appellant
Vs
Gowri Meena Respondent
Prayer:- This Appeal Suit is filed against the judgement and decree dated
25.01.2008 made in OS.No.15 of 2006, on the file of the Additional District
and Sessions Court (FTC), Dindigul.
!For Appellant : Mr.V.Meenakshi Sundaram
^For Respondent : Mr.K.Srinivasan, SC
:JUDGEMENT
This appeal suit had been filed by the Defendant in OS.No.15 of 2006, who suffered a judgement and decree against her.
2. The above suit had been filed by the Respondent herein, seeking specific performance of the agreement of sale dated 16.6.2005 on payment of balance sale consideration of Rs.50,000/- and for permanent injunction, restraining the Defendant, who is the Appellant herein, from dealing with the property.
3. It is the case of the Plaintiff that the Defendant was the owner of the vacant land, having purchased the same on 6.4.1998 at Natham Town. The land was purchased by obtaining loan from the Cooperative Society and a house was also constructed. It was stated that the Plaintiff and the Defendant had entered into an agreement of sale dated 16.6.2005 for a total consideration of Rs.5 lakhs and an advance of Rs.4,50,000/- was also paid. It was further mentioned in the agreement of sale that the balance of Rs.50,000/- should be paid by the Plaintiff on or before 15.2.2006 and on such payment, the Defendant should execute the sale deed in favour of the Plaintiff. It was further provided in the agreement that the Plaintiff is entitled to seek specific performance of the same. It had been specifically pleaded that the Plaintiff was always ready and willing to perform her part of the agreement of sale. She had sent a notice on 2.2.2006, seeking specific performance. A reply was sent, stating that the agreement of sale had been created by the Plaintiff. It had been further stated that the Defendant was attempting to deal with the property and consequently, the suit had been filed as stated above, seeking specific performance on payment of balance sale consideration of Rs.50,000/-.
4. The Defendant had filed a written statement, stating that the Defendant had obtained a loan of Rs.2 lakhs and at that time, the Plaintiff had obtained signatures in blank stamp papers. It had been further stated that the Defendant had paid interest till December 2005. It had been further stated that the Plaintiff had utilised the signed blank stamp papers and had created the agreement of sale. It had been, therefore, stated that the suit should be dismissed.
5. An additional written statement was also filed by the Defendant, stating that the suit had been filed on the basis of a forged agreement of sale. It had been further stated that the property had been mortgaged with the Cooperative Society and there was a due of Rs.3 lakhs towards the said mortgage. It had been further stated that there was an attachment by the Agricultural Bank for payment of Rs.6 lakhs. There was also another mortgage to a private party to a sum of Rs.2 lakhs. The property was also subjected to attachment by an order of the III Additional Sub Court, Madurai. It had been stated that the property, which is so steeped in mortgages, could not have been the subject of an agreement of sale. It had been further stated that the Plaintiff had no means to pay the advance of Rs.4,50,000/-.
6. A reply had also been filed on behalf of the Plaintiff, stating that on the basis of the written statement, issues had been framed and at the time of advancing oral evidence, the additional written statement had been filed. It had been stated that the Defendant had admitted in the written statement that she had entered into an agreement of sale and consequently, a contrary stand taken in the additional written statement has to be rejected.
7. The parties went on trial. During the trial, the following issues were framed by the court below:-
1.Whether the Plaintiff is entitled to relief sought in the plaint?
2.Whether the Plaintiff is entitled any other relief?
8. During the trial, the Plaintiff had examined herself as PW.1 and also examined three other witnesses as PW.2, PW.3 and PW.4, who were the attestors and the scribe to the agreement of sale respectively. The Plaintiff had marked three documents, namely, the agreement of sale dated 16.6.2005, the advocate notice dated 2.2.2006 and the reply, as Ex.A1 to Ex.A3. The Defendant had examined herself as DW.1 and examined an independent person, as DW.2, who was the employee of the Cooperative Bank, from where loan was availed. The Defendant had marked two documents, namely, the encumbrance certificate and the attachment notice from the Housing Board, as Ex.D1 and D2, respectively.
9. On consideration of the oral and documentary evidence, the Trial Court had decreed the suit with costs and had further directed that the Plaintiff should deposit the balance sale consideration of Rs.50,000/- within one month and on such deposit, the Defendant should execute the sale deed in favour of the Plaintiff. The Defendant was also restrained by an order of interim injunction from dealing with or alienating the suit property. Challenging the findings in the said judgement, the Defendant had preferred this appeal.
10. In this appeal, the learned counsel for the Appellant had, after taking the court through the pleadings and the evidence, both oral and documentary, stated that in the written statement, the Appellant denied the agreement and actually stated that signed stamp papers had been given to the Plaintiff and in the additional written statement, the forgery was explained, by stating that the said blank signed stamp papers were filled in as an agreement of sale. It had been further stated that this court should give necessary weightage to Section 20 of the Specific Relief Act and it was also urged that there was no pleadings with respect to readiness and willingness as contemplated under Section 16(c) of the said Act. The learned counsel also drew the attention of this court to Ex.D1, encumbrance certificate and the entries madae therein and stated that it was highly improbable that the Respondent would have entered into such an agreement of sale for a total sale consideration of Rs.5 lakhs and paid a substantial advance of Rs.4,50,000/- and seek 8 months time to pay the balance of Rs.50,000/-. It had been further stated that there was no necessity for the Respondent to enter into an agreement of sale. The property was already Appellant to mortgages and attachment and it was also highly improbable that the Respondents would seek to purchase such a property.
11. The learned senior counsel for the Respondent countered the said arguments and pointed out that the signature has been admitted and the agreement of sale was a validly executed document. He also pointed out that the notice was issued prior to the date of expiry of the agreement of sale and the suit was also filed immediately thereafter on 28.3.2006. It had been further stated that even according to the Appellant, there was necessity for immediate cash and consequently, a substantial portion of the sale consideration had been paid by the Respondent. The learned senior counsel further stated that witnesses to the document were examined to speak about the execution of the document. The scribe had also been examined. The scribe had further stated that he had written the agreement of sale. The learned senior counsel further stated that the judgement of the court below did not warrant any interference by this court and the Respondent had come to court based on a validly executed agreement of sale, which is to be enforced by this court.
12. This court considered the arguments of the learned counsel on either side and also considered their rival submissions and also perused the materials placed on record.
13. The point to be decided in this appeal is as to whether Ex.A1, which is projected as an agreement of sale by the Respondent, herein, had been executed by the Appellant with knowledge that it was an agreement of sale or whether the said agreement of sale had been signed on blank stamp papers by the Appellant and subsequently, filled in by the Respondent.
14. The Trial Court commented upon the contrary stands taken by the Appellant in the written statement and in the additional written statement. In the written statement, the Appellant had claimed that the suit was based on forgery. This was taken note by the court below since it had framed issues that the signatures of the Appellant had been forged by the Respondent herein in Ex.A1. However, in the additional written statement, the Appellant had admitted to signing in blank stamp papers, thereby admitting the signatures, but had stated that the wordings ?agreement of sale? had been subsequently filled in. It is the stand of the Appellant that they did not have any intention to sell the property and they required a loan of Rs.2 lakhs and when the same was advanced by the Respondent, the Appellant had been forced to sign on blank stamp papers and these signed blank stamp papers were used by the Respondent to indicate that an agreement of sale had been entered into between the parties. When this is the stand taken by the Appellant, the burden of proof is more on the Appellant to show that there had been borrowal from the Defendant to an extent of Rs.2 lakhs and as stated in the additional written statement, they had discharged the borrowals by repaying the interest amount till December 2005 and thereafter, there had been differences between the Appellant and the Respondent and consequently, the Respondent had utilised the signed blank stamp papers as if it was an agreement of sale. This burden is to be primarily discharged in the first place by the Appellant with respect to borrowal of Rs.2 lakhs and its repayment. To this extent, there is no oral or documentary evidence advanced by the Appellant.
15. The Appellant has called upon this court to presume that there was no necessity to borrow or to sell the suit property. According to the learned counsel for the Appellant, the suit property already had preexisting encumbrances as evidenced by Ex.D1. There was a loan from the Housing Society. The property was also under mortgage with the Cooperative Bank. There had also been attachment by a competent civil court. Consequently, it had been stated that it was only a loan transaction and it was not an agreement of sale. I disagree with the said contention of the Appellant.
16. The Appellant claimed that her borrowal was Rs.2 lakhs, but the loan from the Housing Society, mortgage from the Cooperative Bank and the attachment by a civil court exceeded the said sum of Rs.2 lakhs. However, the fact that the property was subjected to mortgage and there was a minimum threat of sale of the property is evident from the entries shown in Ex.D1. Consequently, the Appellant had required liquid cash. This was provided by the Respondent. The learned counsel for the Appellant had stated that the the sale consideration was fixed at Rs.5 lakhs and a sum of Rs.4.5 lakhs was said to have been paid as advance. This is only in consonance with the debt trap which the Appellant faced. She required immediate loan and consequently, the Respondent had advanced a sum of Rs.4.5 lakhs. But, even otherwise, a perusal of Ex.A1 shows that the signatures of the Appellant is very close to the printed matter in all the pages 1, 2, 3 and 4. In fact, in page 4, the address had to be written in close lines in ink. Moreover, the witnesses, who are shown in the document, have been examined as PW.2 and PW.3. Another witness is the husband of the Appellant. PW.4 is the document writer. The learned counsel for the Appellant stated that the document writer had not given his licence numbers and other details in Ex.A1, but that will not be a ground to set aside the document. The stand taken by the learned counsel for the Appellant on facts is rejected by this court. The signature is admitted by the Appellant. Thereafter, the burden shifts to the Appellant. Moreover, if there is a plea of forgery, then the burden is heavily on the Appellant. There are no reasons either to discredit or disbelieve the evidence of PW.2 to PW.4.
17. In the decision of this court relied on by the learned counsel for the Appellant reported in 2012-4-LW-435 (Pappammal @ T.Pappa Vs. P.Ramasamy) which is a case, where for a total sale consideration of Rs.40,000/-, a sum of Rs.30,000/- had been paid as advance and for the balance sum of Rs.10,000/-, 5 years time was fixed in the agreement of sale and there was no explanation as to why 5 year period was given, this court had found that the said agreement was not an agreement of sale, but a loan transaction. In the case hand, the facts are entirely different. In this case, the property was subjected to heavy mortgages with three or four different mortgagees. There was also attachment by a court. Moreover, the period was just eight months and the Respondent herein as the Plaintiff had issued notice Ex.A2 even prior to the expiry of the said eight months and the suit has been filed within one month thereafter. Ex.A1 agreement of sale is dated 16.6.2005 and Ex.A2 notice was issued on 02.02.2006 and the suit was filed on 28.3.2006. Consequently, on facts, I will have to distinguish the said decision.
18. The learned counsel for the Appellant had also relied on the decision of this court reported in 2016-4-LW-66 (S.Mallika Vs. R.Saravanan) in which case, for the total sale consideration of Rs.4,05,000/-, a sum of Rs.4 lakhs was paid as advance on the date of the agreement and for payment of balance of Rs.5,000/-, three years time was fixed. Taking these factors into consideration, this court had held that the said agreement was improper and that it was only a loan transaction. Again, with much respect, in this case as stated above, facts are different, as in the case on hand, time limit fixed for payment of balance sale consideration was only eight months and consequently, I hold that Ex.A1 is an agreement of sale.
19. On the other hand, the learned senior counsel for the Respondent had relied on the decision of this court reported in 2003-1-MLJ- 694 (M.Ramalingam (died) and others Vs. V.Subramanyam (died) and others) wherein the Division Bench of this court had discussed in details the conditions to be borne in mind to differentiate an agreement of sale and a loan transaction. In paragraph 10, it had been held as follows:-
?10. What the Defendant contended before the lower court and equally here also is that it was only a loan transaction; that the sale agreement was only manipulated and brought about to hold a threat upon the Defendant to secure the due repayment of Rs.40,000 lent by the Plaintiff; and that it was never intended to be acted upon. When the Defendant came with a plea stating that the intention of the parties was only to treat the same as a loan transaction, and it was never intended to be acted upon, which is inconsistent with the terms of the document, a duty is cast upon the Defendant to strictly prove that it was a different transaction altogether, and what was recorded in the document was intended to be of no consequence whatsoever. No doubt, the Defendant who came with such a plea, can well adduce evidence to show that Ex.A1 agreement though executed by him, was never intended to be operated as an agreement for sale, but only a loan transaction, which was not recorded in the document. After careful consideration of the available materials, the court may hasten to say that the Appellants have miserably failed to prove that the Appellants have miserably failed to prove that it was a loan transaction, and the agreement was never intended to be acted upon. The Defendant has not examined any independent witness or the attestors to the document, nor has he placed acceptable materials to hold so. Except the interested testimony of the Defendant, nothing more is available on record. The specific averments in the written statement run as follows:-
?nkw;go fld;fis gpujpthjp bghWg;ghf bfhLf;fntz;Lk; vd;W mr;RUg;ig Vw;gLj;Jtjw;fhf nkl;Lg;ghisak; tPl;il Fwpj;J U:/40.000/-f;F fpuak; bra;J bfhLf;fntz;Lbkd;w xU xg;ge;jk; vGjp gpujpthjpaplk; ifbaGj;J th';fp hp$p!;lUk; bra;Jbfhz;lhh;/@ This part of the written statement would clearly be indicative of the fact that before executing Ex.A1 sale agreement, the Defendant had the full knowledge that it was an agreement for sale in respect of the plaint schedule mentioned property and it was also registered. Hence, the contention of the Appellants'side that the Defendant signed the document without knowing the contents of the same cannot be countenanced.?
20. The learned senior counsel for the Respondent had also relied on another decision of this court reported in 2010-5-MLJ-899 (D.Ananda Moorthy Vs. P.Chandrakala) wherein also this court, in a plea of defence that the sale agreement executed was only a security for loan, had held as follows:-
? 20. It is an everlasting principle of law that an opinion given by an expert is not a conclusive proof nor substantive evidence and at the most, the Court can come to a conclusion that it is nothing but an opinion. Therefore, the evidence given by DW.4 as well as Ex.B4 are not at all sufficient to make out the defence put forth on the side of the Defendant.
21. Now, the court has to look into the remaining part of the evidence available on record. On the side of the Defendant, as stated earlier Ex.B3 has been filed. Ex.B3 is nothing but a pocket notebook alleged to have been maintained by DW.2 wherein it is stated that some amounts have been given to the husband of the Plaintiff. But as taunted earlier, no signature is found in ex.B3. If really as per the direction of the Defendant, DW.2, has given certain amounts to the husband of the Plaintiff, definitely Ex.B3 must contain his signature. But no signature is found. Therefore, Ex.B3 coupled with the evidence of DW.2 is not at all sufficient to accept the defence taken on the side of the Defendant.?
21. The Division Bench of this court, in 2017-1-LW-120 (Ponammal and others Vs K.V.Janarthanam) had an occasion to discuss the stand of the Defendant, wherein the Plaintiff had refused to hand over the documents as well as blank stamp papers and had observed in paragraph 15 as follows:-
?15. In the written statement filed on the side of the Defendants, it is averred that the Defendants have approached the Plaintiff to repay loan amount of Rs.1,00,000/- (Rupees one lakh only) borrowed by them. But, the Plaintiff has refused to return all the document as well as blank stamp papers. In fact, in the written statement, no specific date has been mentioned . If really such occurrence has taken place and the Plaintiff has refused to hand over all the documents as well as blank stamp papers, definitely the Defendants would have taken some steps. But, in the instant case, no steps have been taken on the side of the Defendants. Therefore, it is quite clear that the defence put forth on the side of the Defendants with regard to Ex.A15 and A16 is of no use.?
In the case on hand, the Appellant has not taken any consistent stand, but merely changed her stand taking mutually destructive pleas in the written statement and in the additional written statement. It is clear that the Appellant had consistently changed her stand. In this connection, once the signature is admitted, then a contrary stand cannot be taken under Section 92 of the Indian Evidence Act. Section 92 of the Indian Evidence Act is as follows:-
? 92. Exclusion of evidence of oral agreement. When the terms of any such contract, grant or other disposition of property, or any matter required by law to be reduced to the form of a document have been proved according to the last section, no evidence of any oral agreement of statement shall be admitted, as between the parties to any such instrument or their representative in interest, for purpose of contradicting, varying, adding to, or subtracting from, its items.
Proviso:- (1) Any fact may be proved which would invalidate any document, or which would entitle any person to any decree or order relating thereto; such as fraud, intimidation. Illegality, want of due execution, want of capacity in any contracting party want or failure of consideration, or mistake in fact or law.
Proviso (2) The existence of any separate oral agreement as to any matter on which a document is silent, and which is not inconsistent with its terms, may be proved. In considering whether or not this proviso applies, the court shall have regard to the degree of formality of the document.
Proviso (3) The existence of any separate oral agreement, constituting a condition precedent to the attaching of any obligation under any such contract, grant or disposition of property, may be proved.
Proviso (4) The existence of any distinct subsequent oral agreement to rescind or modify any such contract, grant or disposition of property, may be proved, except in cases in which such contract, grant or disposition of property is by law required to be in writing, or has been registered according to the law in force for the time being as to the registration of documents.
Proviso (5) Any usage or custom by which incidents not expressly mentioned in any contract are usually annexed to contract of that description, may be proved:
Provided that the annexing of such incident would not be repugnant to, or inconsistent with express terms of the contract.
Proviso (6) Any fact may be proved which shows in what manner the language of a document is related to existing facts.
22. In 1993-2-LW-205 (Nanjammal (died) and another Vs. Palaniammal) the Division Bench of this court has held in paragraph 5 as follows:-
?5. It was one of the contentions urged in the court below that the Plaintiff had not even obtained encumbrance certificate before the execution of Ex.A1 and she had not taken the title deed from the Defendant. The court below has pointed out the recital in Ex.A1 under which the Defendant had undertaken to obtain an encumbrance certificate and give it to the Plaintiff. The fact that the Plaintiff had not taken the title deed in advance does not in any way discredit the truth of the agreement in Ex.A1. In fact, the evidence of the Defendant is that what was written was really an agreement though it was only for the purpose of securing the loan. She (Defendant) has admitted that the Plaintiff wanted her to execute an agreement for sale by way of security for the loan and she did execute such an agreement. When that is the fact, it is not open to the Defendant to raise a plea that the terms of the agreement should be ignored as the real purpose was to secure the loan transaction. It is conceded by the learned counsel for the Appellants that the Defendant is barred from raising such a plea by Section 92 of the Indian Evidence Act.??
23. With respect to the fact of this case, the following facts emerge:-
1.The Appellant had signed Ex.A1.
2.The signatures of the Appellant in Ex.A1 are very close to the printed matter on each page of the four pages.
3.The witnesses to the document had been examined as PW.2 and PW.3.
4.The husband of the Appellant was also a witness to the document, but was not examined by the Appellant to disprove the contents.
5.The scribe to the document was also examined as PW.4 who had stated that he had actually prepared the said document.
6.The document was already under mortgage with several mortgagees and consequently, there was necessity for immediate cash by the Appellant.
7.The agreement of sale was dated 16.6.2005, the suit notice was issued on 2.2.2006 and the suit itself was filed on 28.3.2006.
8.There are pleadings to the effect that the Appellant is ready and willing to pay the balance amount in the plaint.
Once these facts emerged and when the stand of the Appellant that it was only a loan transaction is negatived, this court has no other option except to enforce the agreement of sale Ex.A1.
24. In 1993-2-LW-205 (Nanjammal (died) and another Vs. Palaniammal) the Division Bench of this court has held in paragraph 6 as follows:-
?6. Hence, the only question to be considered is whether the relief of specific performance should not be granted to the Plaintiff. The normal rule is that once the truth of the agreement is made out the court shall enforce it unless there are circumstances which would prove that equity will suffer by enforcing the agreement for sale. In the present case no such circumstances has been brought to the notice of the court either in the pleadings or in the evidence to show that equity favours the Defendant and relief of specific performance should be denied. The Defendant has stated in the evidence that the property was worth much more than Rs.1,01,000/- at the time of the agreement. But, there is absolutely no evidence in support of the same. No document has been produced to prove the value of the lands in the locality and no witness has been examined to speak to the same. In such circumstances we cannot accept the case of the Defendant that the property is more valuable than the consideration mentioned in Ex.A1.?
25. In this case, the Appellant has not shown any circumstances to give any relief on equity and she has not come forward with proper disclosure of facts.
26. In 2011-9-SCC-147 (Citadel Fine Pharmaceuticals Vs. Ramaniyam Real Estates Private Limited and another), the Honourable Supreme Court, while discussing about the equity and when it should be extended, had stated that there should proper disclosure of facts and held in paragraphs 57 to 61 as follows:-
?57. There is another aspect of the matter also. In the instant case by asking for specific performance of the contract, the Plaintiff purchaser is praying for a discretionary remedy. It is axiomatic that when a discretionary remedy is prayed for by a party, such party must come to court on proper disclosure of facts. The plaint which it filed before the court in such cases must state all the facts with sufficient candour and clarity. In the instant case, the Plaintiff purchaser made an averment in the plaint that the Defendant vendor be directed to return the advance amount of Rs.10,00,000/- with interest at the rate of 24% from the date of payment of the said amount till the realisation and an alternative prayer to that effect was also made in the prayer clause (c).
58. However, the fact remains that prior to the filing of the suit the Defendant vendor returned the said amount of Rs.10,00,000/- by its letter dated 4.9.1996 by an account payee cheque in favour of the Plaintiff and the same was sent to the Plaintiff under registered post which was refused by the Plaintiff on 6.9.1996. the Plaintiff suppressed this fact in the plaint and filed the suit on 9.9.1996 with a totally contrary representation before the court as if the amount had not been returned to it by the vendor. This is suppression of a material fact, and disentitles the Plaintiff purchaser from getting any discretionary relief of specific performance by the court.
59. In this connection, we may refer to the Principle of Equitable Remedies by ICF Spry, (4th Edition, Sweet and Maxwell, 1990). Dealing with the question of 'clean hands' the learned author opined that where the Plaintiff is shown to have materially misled the court or to have abused its process, or to have attempted to do so, the discretionary relief of specific performance can be denied to him. In laying down this principle, the learned author relied on a decision of the English Court in Armstrong Vs. Sheppard and Short Limited (1959-2-QB-397) (See Spry, Equitable Remedies, P.243).
60. This court has also taken the same view in Arunima Baruah Vs. Union of India (2007-6-SCC-120) at p.125, paragraph 12 of the Report, this court held that it is trite law that to enable the court to refuse to exercise its discretionary jurisdiction suppression must be of a material fact. This court, of course, held that what is a material fact, suppression whereof would disentitle the suitor to obtain a discretionary relief, would depend upon the facts and circumstances of each case. However, by way of guidance this court held that a material fact would mean that fact which is material for the purpose of determination of the lis.
61. Following the aforesaid tests, this court is of the opinion that the suppression of the fact that the Plaintiff refused to accept the cheque of Rs.10 lakhs sent to it by the Defendant under registered post with acknowledgement due in terms of clause 9 of the contract is a material fact.
So on that ground the Plaintiff purchaser is not entitled to any relief in its suit for specific performance.?
In this case also, there has been suppression of facts by the Appellant and consequently, I hold that the Appellant has not made out any prima facie case to reverse the impugned judgement and decree of the court below.
27. In the result, this appeal suit is dismissed with costs.
To:
The Additional District and Sessions Court (FTC), Dindigul..