Bangalore District Court
Sri.Lokesh Srinivasan vs M/S.Gift It on 2 November, 2018
IN THE COURT OF LXVII ADDL CITY CIVIL AND
SESSIONS JUDGE; BENGALURU CITY (CCH.No.68)
PRESENT
SRI.K.SUBRAMANYA, B.Com., LL.M.
LXVII ADDL CITY CIVIL & SESSIONS JUDGE,
BENGALURU.
Dated this the 2nd day of November 2018.
O.S.No.8277/2015
PLAINTIFF : 1. Sri.Lokesh Srinivasan,
S/o.Srinivasan,
43 years,
R/at.No.816,
River Song Place,
Cary NC 27519,
United States of America.
2. Pradeep,
S/o.Srinivasan,
40 years,
R/at.No.523,
Front Ridge Drive,
Carry NC 27519,
United States of America.
Both are represented by their
P.A.Holder:
Smt.Gowramma,
64 years,
R/at.No.968/16,
12th Main, 4th Cross,
K.K.Hebbar Road,
Hanumanthanagar,
Bengaluru.
[
(By Sri.B.V.B., Advocate)
.Vs.
2 O.S.No.8277/2015
DEFENDANTS : 1. M/s.Gift It,
No.70/24, Ground Floor,
Ganesh Mandir Road,
Tata Silk Farm,
Thyagarajanagar,
Bengaluru.
Rep. by its Partners
Defendant Nos.2 to 4.
2. Sri.Sandesh Shenoy,
No.469, 12th Cross,
25th Main, J.P.Nagar I Phase,
Bengaluru.
3. Sri.J.K.Sharath,
No.151, 'Simhadri',
Y.V.Anaiah Road,
Yelachenahalli,
Bengaluru.
4. Sri.G.Deepak,
No.284/A, 34th 'A' Cross,
Jayanagar 8th Block,
Bengaluru.
(By Sri.N.G.S., Advocate)
Date of institution of suit : 29.09.2015
Nature of Suit : Money Suit
Date of commencement of
evidence : 17.04.2017
Date on which the judgment
is pronounced: 2.11.2018
Duration taken for disposal : Year/s Month/s Day/s
03 01 03
(K.SUBRAMANYA)
LXVII Addl.City Civil and Sessions Judge,
BENGALURU.
3 O.S.No.8277/2015
JUDGMENT
The plaint is filed under Section 26 r/w. Order VII Rule 1 of C.P.C.
The reliefs sought for :-
a) directing the defendants to pay a sum of Rs.18 lakhs together with interest at 21% per annum, from the date of date of suit till realization ;
b) to grant such other relief as the court deems fit under the facts and circumstances of the case, with costs.
2. Plaintiff's case in brief is as under:
The plaintiffs and defendants had entered into Investment and Share Purchase Agreement on 29.03.2010. The terms and conditions of the agreement is set out in the document. The plaintiffs had invested Rs.50 lakhs. The defendants have duly acknowledged the receipt. The defendants on 11.03.2011 had entered into amicable settlement and agreed to pay interest of Rs.15,00,000/-. The defendants also further agreed to repay the principal amount and have returned a sum of Rs.47 lakhs out of the principal. The defendants have agreed to pay a sum of Rs.18 lakhs as total liability due to the plaintiffs. The defendants have not paid the amount nor deposited in spite of repeated requests. Hence, this suit for recovery of said 4 O.S.No.8277/2015 amount along with such other costs as the court deems fit under the facts and circumstances of the case.
3. After service of suit summons, the defendants have appeared and filed their written statement contending that the claim of Rs.18 lakhs is not in any way justified and he is not liable to pay the said sum. The plaintiff initiated the suit with the motive of abusing the process of law. The suit is a vexatious proceedings and just to cause fear in the mind of the defendants. The plaintiff resorted to concealment of the fact "Suppressio Varie and Suggestio Falsie". The material facts are not properly revealed and it has been suppressed. The parties to the above suit are not only discharged from the obligation under the agreement, dated:29.03.2010, but also under the subsequent alleged agreement, dated:11.03.2013. There is novation in the contract. There is e-mail and exchange of correspondence through e-mails. The parties have mutually agreed for full and final settlement of the disputes whereby the defendants had to pay the balance sum of Rs.6 lakhs to the plaintiffs. The plaintiffs agreed to receive the said sum and settled the matter without further claim. The defendants expressed their readiness and willingness and undertaken to pay Rs.6,00,000/- and it has been intimated through e-mails. The particulars of e-mail is also set out in para No.6 of the written statement. The receipt of legal notice and the reply given are all contended in the written statement. Therefore, sought for dismissal of the suit.
5 O.S.No.8277/20154. From the above pleadings, the following issues have been framed.
1. Whether the plaintiffs prove that the plaintiffs and defendants have amicably settled on 11.03.2013 for refund of principal amount of Rs.50,00,000/- along with interest of Rs.15,00,000/- and accordingly, made the part payment of Rs.47,00,000/- and still due of Rs.18,00,000/- ?
2. Whether the defendants prove the novation in the contract and agreed to pay Rs.6,00,000/- only ?
3. Whether the plaintiffs are entitled for suit claim as prayed ?
4. What Order or Decree ?
5. The plaintiff examined P.W.1 and got marked the documents Exs.P.1 to 6. In defense, D.W.1 is examined and Exs.D.1 to 3 got marked.
6. Heard arguments of both the sides.
7. My findings to the above issues are as under:
ISSUE No.1 - Partly in the Affirmative, ISSUE No.2 - In the Affirmative, ISSUE No.3 - Partly in the Affirmative. ISSUE No.4 - As per the final order, for the following :6 O.S.No.8277/2015
REASONS
8. ISSUE Nos.1 TO 3 : Since all these issues are interconnected, they have been taken up together for my discussion in order to avoid the repetition of reasonings.
P.W.1 has reiterated the facts stated in the plaint and filed an affidavit under Order XVIII Rule 4 of C.P.C., for the purpose of evidence. It is stated that the plaintiffs and defendants had entered into Investment and Share Purchase Agreement on 29.03.2010. The plaintiffs had invested the amount of Rs.50 lakhs. The defendants have duly acknowledged the receipt. On 11.03.2013, the plaintiffs and defendants had entered into amicable settlement whereby the defendants agreed to pay interest of Rs.15 lakhs and further, agreed to return the principal amount. The defendant has returned Rs.47 lakhs towards principal. The defendant is still due of Rs.3 lakhs towards principal and agreed to pay the same with interest, in all Rs.18 lakhs. The defendants have not paid the amount as per the terms. Hence, the suit is filed.
9. The plaintiff relied upon the documents in 'P' series - The investment and Share Purchase Agreement, dated:29.03.2010. The settlement agreement, dated:11.03.2013 is also produced and according to it, the defendants agreed for full settlement of Rs.15 lakhs towards interest. The legal notice, reply notice and power of attorney is also relied on behalf of the plaintiff. Those documents are clear as to the parties intent to settle the 7 O.S.No.8277/2015 dispute interse fixing certain amount. But, the parties have not reconciled themselves and further continued negotiations after settlement agreement as per Ex.P.2 admitted by both the parties. It is pertinent to note that the amount mentioned is Rs.15 lakhs pertaining to the interest. The amount due is admittedly Rs.3 lakhs in view of repayment of Rs.47 lakhs as per the admitted fact and admitted in evidence by P.W.1 in the affidavit. Therefore, it is just and necessary to correlate the rate of interest with the balance of principal and to ascertain whether there is liability existed so as to discharge the suit claim by the defendants. The defendants relied upon the reply notice and e-mail correspondence as per Exs.D.1 to 3. The same could be relied under Sections 64(A) & (B) of Indian Evidence Act and under Sections 2(A) and 2(8) of Information Technology Act. It is apparent that P.W.1 has admitted the e-mail made by the defendants and it is revealed by his children.
10. In the cross examination, it is admitted that she do not know reading and writing of the document and she knows little bit Kannada. The plaintiffs have not appeared in person, on the other hand, their mother has testified in affidavit. Therefore, the testimony is to be scrutinized with proper care and caution, as the P.A.Holder was not aware of the facts in toto transpired between the parties. It is also admitted in the cross examination of P.W.1. In page No.8 of the cross examination, it is stated that " I do not know 8 O.S.No.8277/2015 about further Settlement Agreement, dated:27.09.2014 by exchange of e-mail. If my children asked, they are in position to answer the same". Therefore, the vital evidence is not forthcoming on behalf of the plaintiff. P.W.1 also pleaded ignorance as to e-mail sent by her children on 28.09.2014 and 13.02.2015. It is also admitted that the children are not cited as witness.
In further cross examination, it is admitted that she do not know the conversation as per Ex.D.2 through e-mail. The suggestion as to children admitting the claim for Rs.6,00,000/- as per e-mail conversation, dated:27.09.2014. But, unequivocally admitted in page No.10 of the cross examination on 28.09.2014 my children expressed to attorney in Bengaluru that the amount as per settlement to be received and parties to take back the documents, but she has not seen the e-mails. Therefore, the unequivocal admission as to settlement through attorney is to be considered under Sections 17 and 18 of Indian Evidence Act. This admission gains weight to the defense as to settlement arrived through e-mail and there is novation of earlier agreement as per Ex.P.2.
11. D.W.1 also reiterated the facts and stated that there was negotiations through e-mail and it has been marked in 'D' series and as per that, there was final settlement agreement and relinquishing of claim and restricting comprehensive claim to Rs.6 lakhs. The certification under Section 65(B) of Indian Evidence Act also authenticate the 9 O.S.No.8277/2015 mail and that has not been disputed. Hence, the defense is sustainable as to novation of contract/agreement and final settlement given to effect.
12. The learned counsel for plaintiffs has relied upon The Information Technology Act, 2000, wherein it is held as under:
10(A). Validity of contracts formed through electronic means:
Where in a contract formation, the communication of proposals, the acceptance of proposals, the revocation of proposals and acceptances, as the case may be, are expressed in electronic form or by means of an electronic record, such contract shall not be deemed to be unenforceable solely on the ground that such electronic form or means was used for that purpose.
The counsel also relied upon the definition of clause of Indian Contract Act - It is relied as to a proposal and acceptance and when it becomes a promise.
13. The learned counsel for defendants relied upon the following dictums:
1. AIR 1999 SC 1441 (Vidhyadhar .Vs. Mankikrao and another), wherein it is held as under :
(A) Evidence Act (1 of 1872), Section 114 - Adverse inference - Party to suit - Not entering the witness box -
Give rise to inference adverse against him.
10 O.S.No.8277/2015Here in this case also, the plaintiffs even though had personal knowledge of the transaction have not chosen to adduce the evidence by entering into the witness box and deserves the adverse inference.
2. 2005(2) SCC 217 (Janki Vashdeo Bhojwani and another .Vs. IndusInd Bank Ltd., and others), wherein it is held as under:
A. Civil Procedure Code, 1908 - Order
3 Rule 1 and 2, Order 18 Rule 4 and 19, Order 10 Rule 4, Order 11 Rule 1 and Order 26 - Power of power-of-attorney holder to "act" on behalf of the principal - Word "acts" in Order 3 Rule 1 and 2 -
Scope - Power to depose on behalf of the principal - Scope - Power to depose in place of principal, held, extend only to depositions in respect of "acts" done by power of attorney holder in exercise of power grated by the instrument - Term "acts" would not include deposing in place of and instead of the principal for acts done by principal and not by power of attorney holder".
Therefore, the principal plaintiffs, who acted and parted in transaction could not able to depose all the events through the power of attorney holder, who is having limited perseverance of facts. Hence, the plaintiffs have not placed reliable testimony by entering into the witness box.
Even the dictum (2010) 0 SCC 512 (Man Kaur (Dead) by LRs., .Vs. Hartar Singh Sangha) also relied to show 11 O.S.No.8277/2015 adverse presumption relating to abstinence of the plaintiffs to personally tender in box.
It is also observed that the attorney holder cannot depose or give evidence in his place for the acts done by the principal, which the principal alone has personal knowledge.
The dictums and its observations are aptly observed to the case on hand.
Further, the defendants counsel relied upon the dictum AIR 1991 Bombay 129 (Andheri Bridge View Co-op. Hsg. Society Ltd., .Vs. Krishnakant Anandrao Deo and others), wherein the provision Section 62 of Contract Act being enunciated. It reads thus:
" Novation of contract - Substantial changes going to root of contract - There is novation".
Further, the defendants counsel relied upon the dictum reported in AIR 1956 Madhya Bharat 25 (Todarmal Tejmal and another .Vs. Chironjilal, Gopilal and another), it reads thus :
" (B) Contract Act (9 of 1872), Section 62 -
Novation - What constitutes - Novation if constitutes consideration.
In a novation, there must be immediate and present substitution of another contract, and there is no due novation, if the liability under the original contract is not extinguished by the new contract and if there is reversion to the old contract. An agreement under Section 62 12 O.S.No.8277/2015 necessarily implies consideration. Novation itself constitutes a "good consideration" for a fresh promise. (C) Contract Act for Repayment of debt - Discharge or substitution by new contract involving payment of reduced amount.
It cannot be held that a contract for the repayment of a debt can never be discharged or substituted by a new contract which involves the payment of a reduced amount to the creditor in a specified manner. Illustration (b) to Section 62 clearly indicates that such a new contract extinguishes the old debt.
(F) Contract Act, Sections 62 and 63 - Defendant acknowledging debt - Liability substituted by new contract - Suit on original obligation, if maintainable. Defendant acknowledging sum of money as due from him to plaintiff - Subsequently parties agreeing that plaintiff and other creditors of defendant would receive certain properties as satisfaction of their debts, that they would have properties sold and proceeds thereof distributed pro rate - Some properties sold and proceeds distributed - Plaintiff suing defendant on original obligation - Subsequent agreement held was composition between parties and was fully supported by consideration - Defendant's liability to pay amount acknowledged by him was wiped out and substituted by new contract and plaintiff could not, therefore, sue on original obligation. Therefore, the defendants acknowledgement and acceptances through e-mail and the plaintiffs intendment 13 O.S.No.8277/2015 to settle through attorney as admitted by P.W.1 is clear indication of novation of contract earlier entered into between the plaintiffs and defendants.
The power of attorney has been given to the aged mother and it is not natural course, usually the old aged mother will give power of attorney to her sons.
Therefore, the suit deserves to be partly decreed. Hence, I answer the Issue Nos.1 to 3 accordingly.
14. ISSUE No.4: My finding on this Issue is as per the following :
ORDER The suit of the plaintiffs is decreed in part with costs. The defendants are directed to pay a sum of Rs.6,00,000/- along with interest at the rate of 6% per annum from the date of suit till realization as per Section 34 of C.P.C.
Draw the decree accordingly.
(Dictated to the Judgment-writer, transcript thereof is corrected and then pronounced by me in the open court on this the 2nd day of November 2018) (K.SUBRAMANYA) LXVII Addl.City Civil and Sessions Judge, BENGALURU.
14 O.S.No.8277/2015ANNEXURE
1. WITNESSES EXAMINED IN FAVOUR OF THE PLAINTIFF:
P.W.1 Gowramma
2. WITNESSES EXAMINED IN FAVOUR OF THE DEFENDANT :
D.W.1 P. Sandesh Shenoy
3. DOCUMENTS MARKED IN FAVOUR OF THE PLAINTIFF:
Ex.P.1 Investment and Share Purchase Agreement Ex.P.2 Settlement Agreement Ex.P.3 Copy of legal notice Ex.P.4 Reply Notice Ex.P.5 Special Power of Attorney Ex.P.6 General Power of Attorney
4. DOCUMENTS MARKED IN FAVOUR OF THE DEFENDANTS :
Exs.D.1 & E-mails info
1(b)
Ex.D.1(a) Annexure
Exs.D.2, E-mails info
2(a) and (b)
Ex.D.3 65(B) Certificate
(K.SUBRAMANYA)
LXVII Addl.City Civil and Sessions Judge, BENGALURU.
Digitally signed by KRISHNAMURTHY SUBRAMANYA DN: cn=KRISHNAMURTKRISHNAMURTHY HY
SUBRAMANYA SUBRAMANYA,o=G
OVERNMENT OF
KARNATAKA,st=Kar
nataka,c=IN
Date: 2018.11.03
11:56:13 IST