Bangalore District Court
Mr. P.Dayananda Pai vs Mr. L.R.Shivarame Gowda on 26 September, 2019
1
Com.OS No.4908/2009
IN THE COURT OF LXXXII ADDL. CITY CIVIL & SESSIONS JUDGE,
BANGALORE CITY. (CCH.NO.83)
Dated: This the 26th day of September 2019.
PRESENT : Sri. Jagadeeswara. M.,B.Com,LL.B.,
LXXXII Addl.City Civil & Sessions Judge, Bangalore.
Com.O.S.NO.4908/2009
PLAINTIFF Mr. P.Dayananda Pai
S/o Late P.Narasimha Pai
aged about 64 years,
r/a No.10/1, Lakshminarayana Complex,
Palace Road,
Bangalore - 560 052.
(By Sri.Umesh.Y.S.-advocate)
VS
DEFENDANTs 1. Mr. L.R.Shivarame Gowda,
S/o late Patel L.Ramegowda,
aged about 53 years,
r/a No.2369, 19th cross,
Banashankari 2nd stage,
Bangalore -560 070.
Also available at:
No.42, "Sudha Mansion", 1st cross,
7th main, Banagiri Nagar,
Banashankari 3rd stage,
Bangalore -560 085.
2. Chetan Gowda L.S.,
S/o L.R.Shivrame Gowda,
major, at No.42, "Sudha Mansion",
1st cross, 7th main, Banagiri Nagar,
Banashankari 3rd stage,
Bangalore -560 085.
2
Com.OS No.4908/2009
(D.1 by Sri. K.P. - Advocate)
Date of institution of the suit : 24.7.2009
Nature of the suit (suit on Suit for recovery of money
pronote, suit for declaration
and possession suit for
injunction,etc) :
Date of the commencement 28.9.2011
of recording of the evidence
Date on which the Judgment 26.9.2019
was pronounced
Total duration Year/s Month/s Day/s
10 02 02
(JAGADEESWARA.M.)
LXXXII Addl.City Civil & Sessions Judge,
Bangalore.
JUDGMENT
Plaintiff has filed this suit for recovery of Rs.4,20,47,139/- with interest at 24% per annum from the defendants.
2. Brief facts of the case are as under:
It is contended in the plaint that defendant No.1 approached the plaintiff and represented that he is absolute owner of certain properties and also has agreement of sale in his favour in respect of 106 acres of land situated at Doddaguni village, Ankanahalli village and Kattaraguppe village, Bellur Hobli, Nagamangala Taluk, Mandya District. Further, defendant No.1 also represented that he is in possession of another 190 acres adjacent land and he is ready to convey all those lands to the plaintiff 3 Com.OS No.4908/2009 after obtaining necessary conversion order and title deeds. After discussion and negotiations, the sale consideration amount was fixed to Rs.5,00,00,000/- for said 106 acres and 190 acres of land and Memorandum of Understanding was entered into between the parties on 8.12.2007 on which date plaintiff paid part consideration amount of Rs.50,00,000/- to defendant No.1 through cheque. It was agreed by the plaintiff to pay Rs.1,00,00,000/- after defendant No.1 obtaining marketable title relating to 106 acres of land in the name of respective owners and after obtaining a title report from a reputed advocate which is condition precedent as per terms of MOU. Further, plaintiff has agreed to pay another sum of Rs.One Crore within 30 days of payment of above said one crore rupees and then to pay Rs.2.00 Crores to the nominee of defendant No.1. Defendant No.1 agreed to receive remaining Rs.50,00,000/- from the plaintiff after perfecting his title over the said 190 acres of land.
Plaintiff had made it very clear to defendant No.1 that he was always ready and willing to perform his part of contract. But, defendant No.1 went on postponing the same. In the month of January 2008 again defendant No.1 met the plaintiff and persuaded him to pay Rs.One Crore for preparing necessary documents of title. Hence, plaintiff paid Rs.One Crore to defendant No.1 through cheque on 7.1.2008. Subsequently, in the last week of January 2008, again defendant No.1 along with defendant No.2 approached the plaintiff and persuaded him to pay another sum of Rs.One 4 Com.OS No.4908/2009 crore for getting land conversion order and also title deeds of land. Hence, plaintiff paid Rs.One crore on 25.1.2008 through cheque issued in the name of defendant No.2 who is none other than the son of defendant No.1. After receipt of said amount defendant No.1 never turned up nor kept his words despite repeated requests of plaintiff . Again in the first week of April 2008, the first defendant along with defendant No.2 met the plaintiff and persuaded him to pay Rs.70,00,000/- with the assurance that land conversion order and land title report of advocate will be obtained in the first week of May 2008 and amount is required to pay expenses and fees etc. Hence, at the instructions of defendant No.1, plaintiff paid Rs.70,00,000/- by issuing cheques to the name of defendant No.2 on 5.4.2008, 12.4.2008 and 30.4.2008. Thus, defendants have received Rs.3,20,00,000/- from the plaintiff towards consideration amount. But, despite repeated demands and requests of the plaintiff including letter sent by the plaintiff through RPAD on 13.1.2009, defendant No.1 has failed to comply his part of obligation under MOU dated 8.12.2007. Hence, plaintiff got issued legal notice dated 8.4.2009 to the defendants and the same was served to defendant No.2. Notice sent to defendant No.1 returned with endorsement "LEFT". Inspite of issuance of legal notice, the defendants neither replied nor paid the amount. Accordingly, plaintiff has claimed recovery of amount i.e., refund of advance amount of Rs.3,20,00,000/- and interest on it at the rate of 24% p.a., amounting to 5 Com.OS No.4908/2009 Rs.4,20,47,139/-. Thus, they claimed recovery of Rs.4,20,47,139/- in all with future interest at 24% p.a.
3. Defendants No.1 & 2 appeared and filed their written statement contending that the suit of the plaintiff is not maintainable on facts and in law. The defendants admitted that after series of negotiations, the sale consideration in respect of the properties measuring to an extent of 106 acres and 190 acres of land was fixed at Rs.5 Crores and accordingly MOU dated 8.12.2007 was entered into between the parties and Rs.50 Lakhs was paid by the plaintiff through cheque bearing No.599216 dated 8.12.2007 and the receipt of the same was duly acknowledged by the first defendant. It is contended that as per the conditions of MOU, the plaintiff had to pay a sum of Rs.1.00 Crore within 30 days from the earlier payment and to satisfy that condition, plaintiff paid another sum of Rs.1.00 Crore by way of cheque No.661854 dtd. 25.1.2008. To overcome the lacuna/latches, the plaintiff has created concocted story.
3(a). It is further contended that the first defendant is the absolute owner and in possession of 106 acres of land in and around Bellur Hobli, Mandya District. Under the MOU dated 8.12.2007 entered into between the plaintiff and the first defendant, the plaintiff had requested the defendant to convey land to an extent of 296 acres in Nagamangala Taluk including 106 acres belonging to the first defendant and agreed that he shall bear the expenses for conversion of said extent of 296 acres of land 6 Com.OS No.4908/2009 for residential purposes. 190 acres of land mentioned in the MOU vests with Government and it is Gomal land. Since the first defendant is an all time politician, the plaintiff had approached the first defendant for regularization of the said land. The first defendant only after entering into the agreement with the plaintiff understood that there is a bar for regularization of the said 190 acres of land as the same is a Government land. The plaintiff had made him to believe that the land belongs to farmers. Since the first defendant was not the owner of 190 acres of land mentioned in MOU and had no right to execute the sale deed in respect of the said land in favour of plaintiff or any body, the first defendant did not proceed in terms of the MOU. The first defendant however, is always ready and willing to execute the sale deed in respect of 106 acres of land which is mentioned in the MOU.
3(b). It is further stated that as per the terms of the MOU, the plaintiff has to pay Rs.50 Lakhs as on the date of MOU and Rs.1.00 Crore against production of original documents by the defendant No.1 and after verifying the same through the plaintiff's advocate, within 30 days from the earlier payment, the plaintiff had to pay another sum of Rs.1.00 Crore to the defendant No.1 to keep the terms of the MOU. The plaintiff had also to arrange for a survey to the entire land for getting the conversion order from the competent authorities by the first defendant. Even though the plaintiff has made payment of Rs.2.50 Crores after seeing the original title deeds 7 Com.OS No.4908/2009 from the first defendant and also took the opinion of his advocate, but inspite of repeated requests by the defendants, the plaintiff has not come forward to get the survey of the land for further progress of the MOU. However, in order to shift the liability, the plaintiff has filed the present suit.
3(c). The first defendant is always ready and willing to perform his part of contract but inspite of that, plaintiff is not interested in getting registered the property due to drop in real estate markets. Even today, if the plaintiff arranges for the survey of land as per the survey report, the first defendant will co-operate for getting conversion of lands at the cost of plaintiff, but the plaintiff is not coming forward to do so.
3(d). It is further stated that the 2 nd defendant is the son of first defendant. Unnecessarily the plaintiff has made the 2nd defendant as a party to the suit without there being any valid reason and who is not a party to the MOU, only with an intention to harass the defendants. The payment of Rs.70 Lakhs to the 2nd defendant by way of cheques was given for the purpose of arranging a trip to London. The 2 nd defendant has arranged London Trip for plaintiff and first defendant for their business improvements, wherein the 2nd defendant has incurred certain amounts and to clear the same, the plaintiff has issued cheque for Rs.70 Lakhs, but has included the said amount in the suit transaction. Plaintiff has not arranged for any plans which are necessary annexures for filing application for 8 Com.OS No.4908/2009 conversion of agricultural use to residential purpose and he is postponing the same for one or the other reason. The first defendant is ready to execute the sale deed after receiving the balance sale consideration or if the plaintiff provides all necessary plans and survey reports at the cost of plaintiff, the first defendant is ready to get the conversion orders also. For none of the alternatives, the plaintiff is not coming forward. The plaintiff has not paid proper court fee. There is no cause of action for the suit. Accordingly, defendants have requested to dismiss the suit with costs.
4. Based on the above pleadings, the following issues are framed :
ISSUES
1. Whether the plaintiff proves that he is always ready and willing to perform his part of the contract and 1 st defendant went on postponing the same ?
2. Whether the plaintiff proves that 1st defendant approached the plaintiff and requested the plaintiff to pay a sum of Rs.One Crore during the month of January 2008 ?
3. Whether the court fee paid by the plaintiff is sufficient ?
4. Whether the plaintiff is entitled for the reliefs as prayed for ?
5. Whether the plaintiff is entitled for interest as prayed ?9
Com.OS No.4908/2009
6. What order or decree ?
5. Plaintiff to prove his case, has got examined himself as PW.1 and got examined the attesting witness to the Memorandum of Understanding dated 8.12.2007 as PW.2 and got marked documents at Exs.P.1 to P.24. On the other hand, the Defendant No.1 was examined as DW.1. No documents were marked on behalf of defendants.
6. I have heard the arguments of both sides.
7. My findings on the above issues are as follows: -
Issue Nos. 1 & 2 : Affirmative Issue No.4 & 5 : Plaintiff is entitled to recover Rs.3,20,00,000/-
with interest at 18% per annum from the date of suit from defendant No.1 only.
Issue No.3 : Affirmative
Issue No.6 : As per final order
for the following:
REASONS
8. Issue Nos.1,2,4 & 5 : It is submission of learned advocate for plaintiff that it is admitted fact that plaintiff and defendant No.1 had entered into Memorandum of Understanding dated 8.12.2007 at Ex.P.1 under which defendant No.1 had agreed to convey land measuring 106 acres and land measuring 190 acres of various survey numbers situated in Doddaguni, Ankanahalli and Kattaraguppe villages of Bellur Hobli, Nagamangala Taluk, Mandya District, in favour of plaintiff for 10 Com.OS No.4908/2009 consideration of Rs.5 Crores. It is also admitted fact that on the date of MOU dated 8.12.2007, plaintiff paid part consideration amount of Rs.50 lakhs to the defendant No.1 by way of cheque No.599216. Subsequently as per the terms of MOU, plaintiff paid Rs.One Crore to the first defendant through cheque No.599962 dated 7.1.2008 and then plaintiff paid another sum of Rs.One Crore through cheque No.661854 dated 25.1.2008.
Defendants have admitted payment of Rs.2 Crores made by the plaintiff through those two cheques dated 7.1.2008 and 25.1.2008. Subsequently as per the request of defendant No.1, plaintiff paid Rs.70 lakhs by way of issuing cheques dated 5.4.2008, 12.4.2008 and 30.4.2008 bearing cheque Nos.289458, 289745 and 283324 to the name of defendant No.2 who is none other than son of defendant No.1. There is no dispute raised by the defendants relating to payment of this Rs.70 Lakhs made by the plaintiff through said cheques issued to the name of defendant No.2. But, it is the contention of defendants that the said payment of Rs.70 Lakhs through cheques to the name of 2nd defendant was made by the plaintiff for the purpose of arranging a trip to London for the plaintiff and defendant No.1 and said amount was not paid towards consideration amount. Defendants have failed to prove that said payment of Rs.70 Lakhs through cheques to the name of 2nd defendant was made by the plaintiff for the purpose of arranging a trip to London for the plaintiff and defendant No.1 and said amount was not paid towards consideration amount. DW.1 has expressed 11 Com.OS No.4908/2009 his ignorance relating to alleged trip of London. Defendant No.2 has not been examined to prove said payment of Rs.70 lakhs was to arrange trip of London and not for payment of consideration amount. Thus, it is clearly proved by the plaintiff that already plaintiff has paid major portion of consideration amount of Rs.3.20 Crores out of agreed consideration amount of Rs.5 Crores. As per the terms and conditions of the MOU at Ex.P.1 out of balance consideration amount, Rs.2 Crores was to be paid to the nominee of the first defendant within a period of 15 days from the date of defendant No.1 obtaining conversion order from the revenue department relating to 106 acres of land from agricultural to non-agricultural purpose. But, defendant No.1 has failed to get the clearance of the title deeds of the subject matter of the property of the MOU and further, defendant No.1 has failed to get the conversion order of 106 acres of land. Therefore, plaintiff could not pay Rs.2 Crores to the nominee of defendant No.1. In fact, plaintiff was always ready and willing to perform his part of contract. It is defendant No.1 who has committed default in performing his obligation under the MOU. Therefore, plaintiff is entitled for refund of advance paid amount with interest at 24% per annum as claimed. Accordingly, learned advocate for plaintiff has requested to answer Issue Nos.1,2,4 &5 in the affirmative.
9. On the other hand, it is submission of learned advocate for defendants that plaintiff was not ready and willing to perform his part of 12 Com.OS No.4908/2009 the contract in as much as plaintiff has failed to get the survey of the land conducted through proper surveyors as per the terms of MOU. In fact, land measuring 190 acres shown in the MOU at Ex.P.1 is Gomala land and it belongs to the Government. Inspite of having knowledge of this fact, plaintiff made defendant No.1 to enter into such MOU at Ex.P.1 to convey said Government land measuring 190 acres and therefore, MOU at Ex.P.1 is not enforceable one. So far as land measuring 106 acres is concerned, which is shown in the MOU at Ex.P.1, defendant No.1 obtained clear title deeds of said land and after verifying the same plaintiff made payment of Rs.2 Crores to the first defendant i.e., Rs.One crore through cheque No.599962 dated 7.1.2008 and then Rs.One Crore through cheque No.661854 dated 25.1.2008. As per the terms of MOU at Ex.P.1 plaintiff had to pay Rs.2 Crores to the nominee of defendant No.1 within 15 days from the date of defendant No.1 furnishing clear title deeds of the land measuring 106 acres. Though defendant No.1 furnished clear title deeds of said land, but plaintiff has failed to make payment of Rs.2 Crores to the nominee of defendant No.1 and thereby plaintiff has committed breach of terms of MOU at Ex.P.1. This shows plaintiff was not ready and willing to perform his part of contract under MOU at Ex.P.1. Further it is also submission of learned advocate for defendants that in fact payment of Rs.70 lakhs made by the plaintiff by issuing three cheques to the name of defendant No.2 was for arranging business trip to London for the plaintiff 13 Com.OS No.4908/2009 and defendant No.1 and it was not for payment of consideration amount. In fact defendant No.2 is not a party to the MOU at Ex.P.1 and therefore, amount of Rs.70 lakhs paid to the name of defendant No.2 was not towards consideration and same is not recoverable. Since plaintiff was not ready and willing to perform his part of contract, he is not entitled to claim refund of advance paid amount with interest. There is no contract for payment of interest. Interest claimed by the plaintiff is excessive and exorbitant. Accordingly, learned advocate for defendants has requested to answer Issue Nos.1,2,4 & 5 in the negative.
10. At this stage itself it is material to note that plaintiff has produced original Memorandum of Understanding dated 8.12.2007 at Ex.P.1. Terms and conditions of the MOU at Ex.P.1 are as under:
"Description of the property:
Property bearing a) Survey Nos.19, 24 and 25 of Doddaguni Village, Nagamangala Taluk, b) 8 Items of properties owned by Sri. Dayananda Reddy as per the Agreement of Sale dated 17/10/2007, c) 14 Items of properties from Sri.B.N.Thimma Reddy as per the Agreement dated 17/10/2007 and d) 11 Items of properties from Smt.Neelamma as per Agreement daed 17/10/2007. Thus altogether an extent of 106 Acres of one Block of land and fenced on all the four sides and situated within 70 Kms. From Bangalore.
Extra land:
The First Party further confirms that he has in his possession and cultivation an additional 190 Acres of lands holding since last several years adjacent to 106 Acres plot. The First Party undertakes to get these lands of 190 Acres regularized by perfecting the Title at his own cost and convey the same in favour of the Second Party.
Sale price:14
Com.OS No.4908/2009 The agreed sale consideration is Rs.5.00 Crores is inclusive of 106 Acres of titled property as residentially converted lands and 190 Acres of land for which Title to be perfected. The statutory payment for the conversion of these lands shall be borne by the Second Party alone.
Terms of payment:
1) Out of the agreed sale consideration amount of Rs.5.00 Crores, Rs.50.00 lakhs has been agreed to be held back by the Second Party till the Title for 190 Acres land is perfected and the First party is able to convey this portion.
2) The remaining sum of Rs.4.50 Crores to be released by the Second Party to the First Party in the following manner:
i) Rs.50.00 Lakhs (Rupees Fifty Lakhs only) by cheque bearing No.599216, dated 8/12/2007, drawn on Centurion Bank of Punjab Limited, K.H.Road, Branch, Bangalore, favouring the First Party as an advance at the time of signing this MoU.
ii) Rs.1.00 Crore to be paid by the Second Party to the First Party on First Party obtaining marketable Title Certificate for 106 Acres of land in the names of the respective Owners with latest Encumbrance Certificate and Revenue Records. The detailed Title Certificate to be certified by any reputed Advocate of the First Party.
Against making this payment, the First Party shall deliver all the Original Title Deeds pertaining to the entire 106 Acres to the Second Party.
iii) Rs.1.00 Crore to be paid as further advance within 30 days time from the date of the previous payment.
iv) Out of the remaining sum of Rs.2.00 Crores, the Second Party shall pay a sum of Rs.2.00 Crores directly to Sri.Dayananda Reddy, the nominee of the First Party and this payment shall be made within a period of 15 days time from the date of the First Party obtaining conversion order from Revenue Department converting these 106 Acres of land from agriculture to non-agriculture residential purposes and against conveyance of the property in favour of the Second Party or his nominee or nominees.
15Com.OS No.4908/2009 Other terms:
i) On signing this MoU, the Second Party is allowed to survey the land through proper surveyors.
ii) The entire cost of conveyance and registration shall be borne by the Second Party.
Iii) The Sale Deed to be registered in favour of the Second Party or his nominee or nominees either as one Deed or in parts purely at the discretion of the Second Party."
It is admitted fact that plaintiff and defendant No.1 had entered into MOU at Ex.P.1 under which defendant No.1 had agreed to convey land measuring 106 acres and land measuring 190 acres of various survey numbers situated in Doddaguni, Ankanahalli and Kattaraguppe villages of Belur Hobli, Nagamangala Taluk, Mandya District, in favour of plaintiff for consideration of Rs.5 Crores. It is also admitted fact that on the date of MOU dated 8.12.2007, plaintiff paid part consideration amount of Rs.50 lakhs to the defendant No.1 by way of cheque No.599216. Subsequently as per the terms of MOU, plaintiff paid Rs.One Crore to the first defendant through cheque No.599962 dated 7.1.2008 and then plaintiff paid another sum of Rs.One Crore through cheque No.661854 dated 25.1.2008. Defendants have admitted payment of Rs.2 Crores made by the plaintiff through those two cheques dated 7.1.2008 and 25.1.2008.
11. Defendant No.1 has been examined as DW.1 who has filed his affidavit in lieu of his chief examination. In para No.3 of his affidavit, it is 16 Com.OS No.4908/2009 admitted as under:
"3.I further state that it is an admitted fact that myself and the plaintiff had entered into a Memorandum of Understanding dated 8.12.2007 as per the terms and conditions agreed upon. As on the date of the Agreement, I was having 106 acres in my possession. Apart from that, the adjacent land measuring 190 acres was also in my possession. However, I had not acquired the title to the same. But it was agreed that the same has to be regularised by perfecting the title in respect of the same and conveyed in favour of the plaintiff."
So far payment of part consideration amount of Rs.2.50 Crores made by the plaintiff to the defendant No.1 is concerned, it is admitted by DW.1 in para no.5 of his chief examination affidavit as under:
"5. I further state that as per the terms of the Memorandum of Understanding the plaintiff had paid Rs.50.00 Lakhs by way of cheque bearing No.599216 dated 8.12.2007 drawn on Centurion Bank of Punjab Ltd., K.H. Road branch, Bangalore, in my favour and Rs.1.00 Crore on 7.1.2008 and further Rs.1.00 Crore on 25.1.2008 after obtaining marketable title in respect of 106 acres of land with latest encumbrance certificate and the revenue records."
Thus, it is clearly and categorically admitted by the defendants that plaintiff and defendant No.1 had entered into MOU at Ex.P.1 agreeing to convey 106 acres of land and also 190 acres of land shown in Ex.P.1 in favour of plaintiff for consideration of Rs.5 Crores and as on the date of MOU at Ex.P.1, defendant No.1 had received Rs.50 Lakhs and then defendant No.1 had received Rs.1.00 Crore on 7.1.2008 and then Rs.1.00 Crore on 25.1.2008 from the plaintiff towards part consideration amount. Having made such clear and categorical admission both in the written statement and also in the chief examination affidavit of DW.1 relating to 17 Com.OS No.4908/2009 receipt of part consideration amount of Rs.2.50 Crores, but in the cross- examination it is strange story stated by DW.1 at Page No.13 as under:
"I received advance amount of Rs.50,00,000/- on 8.12.2007 when MOU was entered into. Subsequently on 7.1.2008 I received Rs.1,00,00,000/- from the plaintiff towards election purpose. It is false to suggest that plaintiff had paid Rs.1,00,00,000/- on 7.1.2008 to me towards balance consideration amount. There is no records to show that on 7.1.2008 plaintiff had paid Rs.1,00,00,000/- to me as gift towards my election expenses and not as balance consideration amount."
Evidence deposed by DW.1 in his cross-examination is not trust worthy for the reasons that in the written statement it is the admission of defendants and in chief examination affidavit it is also clear admission of DW.1 that on 7.1.2008 defendant No.1 received Rs.1,00,00,000/- from the plaintiff towards consideration amount. But in the cross-examination at page No.13, it is strange evidence of DW.1 that he received Rs.1,00,00,000/- from the plaintiff on 7.1.2008 as gift towards his election expenses and not towards consideration amount. He has no records to show that on 7.1.2008 plaintiff had paid Rs.1,00,00,000/- to him as gift towards his election expenses and not as balance consideration amount.
12. Relating to payment of Rs.70,00,000/- made by the plaintiff by issuing cheques to the name of 2nd defendant is concerned, it is relevant to note that it is contention of plaintiff that during the first week of April 2008, first defendant approached him along with defendant No.2 and convinced him by saying that all the original documents and the orders of conversion of the lands are ready and first defendant is in need of money to 18 Com.OS No.4908/2009 pay the conversion fee, advocate's fee and other incidental expenses and accordingly first defendant requested the plaintiff to pay amount by issuing cheque to the name of defendant No.2. Hence plaintiff paid Rs.70 lakhs by way of cheques dated 5.4.2008, 12.4.2008 and 30.4.2008 bearing cheque Nos. 289458, 289745 and 283324 and those cheques were issued in the name of defendant No.2 as per the request of defendant No.1. Defendants have not raised dispute relating to amount of Rs.70 Lakhs paid by the plaintiff by issuing cheques to the name of defendant No.2. But in the written statement defendants have contended as under:
"It is submitted that the payment of Rs.70.00 Lakhs to the Second defendant by way of cheques which has given to him for the purpose of arranging a trip to London. The Second defendant has arranged London trip for plaintiff and first defendant for their business improvements. For which, the Second defendant has incurred certain amounts to clear the same, the plaintiff has issued Rs.70.00 lakhs by way of cheques, but the plaintiff has included the said amount in the suit transaction, wherein the second defendant is not a party to the MoU."
Thus, though defendants have admitted payment of Rs.70 Lakhs made by the plaintiff by way of issuing cheques to the name of defendant No.2, but it is contention of defendants that the said payment of Rs.70.00 Lakhs was given to the second defendant towards expenses incurred for arranging a trip to London for the improvement of business of plaintiff and defendant No.1. Relating to this amount of Rs.70.00 Lakhs, it is stated by DW.1 in para No.8 of chief examination affidavit as under:
"I further state that the plaintiff had paid a sum of Rs.25.00 Lakhs on 5.4.2008, Rs.25.00 Lakhs on 12.4.2008 and Rs.20.00 Lakhs on 30.4.2008, in all netting 19 Com.OS No.4908/2009 Rs.70.00 Lakhs in favour of second defendant, who is not a party to the agreement. The said net cited amount of Rs.70.00 Lakh was paid by the plaintiff for his business purpose towards publicity and advertisement in foreign countries with regard to formation of layout proposed to be formed by the plaintiff, which is neither refundable nor shall be calculated as a part of the sale consideration. Therefore, inclusion of Rs.70.00 Lakhs,which is paid by the second defendant, is only to make London trip for the improvement of his business prospects. Hence, Rs.70.00 lakhs which is paid by the second defendant is not an amount which forms part of the sale consideration. As such, it is not refundable. Therefore, the suit filed by the plaintiff inclusive of Rs.70.00 lakhs is improper and incorrect."
Whereas in the cross-examination, it is strange and contradictory evidence of DW.1 as under:
"Defendant No.2 is my son. I do not know how much amount was received by the defendant No.2 from the plaintiff. I do not know Rs.70,00,000/- which is shown in Para No.14 of chief examination affidavit, given by the plaintiff to the defendant No.2. I do not know Rs.70,00,000/- paid by the plaintiff to defendant No.2 and further I do not know when plaintiff paid Rs.70.00 Lakhs, if any to defendant No.2."
Thus, it is undisputed fact that plaintiff made payment of Rs.70.00 Lakhs by issuing cheques to the name of defendant No.2 who is none other than son of defendant No.1. It is contention of plaintiff that as per the request of plaintiff, he paid said Rs.70,00,000/- towards consideration amount, by way of issuing cheques to the name of defendant No.2. After having admitted payment of Rs.70 Lakhs made by the plaintiff by way of issuing cheques to the name of defendant No.2, it is contention of defendants in their written statement that plaintiff paid Rs.70 Lakhs to defendant No.2 since defendant No.2 made expenses to arrange a trip to London for plaintiff and defendant No.1 for improvement of their business. Same is 20 Com.OS No.4908/2009 the story stated by DW.1 in his examination in chief affidavit. But, in the cross-examination it is strange evidence of DW.1 that he does not know Rs.70 Lakhs paid by the plaintiff to the name of defendant No.2. He does not know why and when plaintiff made payment of Rs.70 Lakhs to the defendant No.2. This type of contradictory evidence of DW.1, is sufficient to hold that evidence of DW.1 is not trust worthy relating to payment of Rs.70 Lakhs is concerned. Defendant No.2 has not stepped into the witness box to depose that he had arranged London trip for the plaintiff and defendant No.1 and as such, for the expenses incurred in that regard, plaintiff made payment of Rs.70 Lakhs to him. Therefore, from these materials and the circumstance of the case, the contention of the plaintiff that as per the request of defendant No.1, he paid Rs.70,00,000/- by issuing cheques to the name of defendant No.2 towards consideration amount is probable and acceptable one.
13. As per the terms of MOU at Ex.P.1 part consideration amount of Rs.50,00,000/- was paid by the plaintiff to the defendant No.1 on the date of Ex.P.1 and out of balance consideration amount, Rs.1.00 Crore shall be paid by the plaintiff to the defendant No.1 on the defendant No.1 obtaining marketable Title Certificate for 106 acres of land in the names of respective owners with latest Encumbrance Certificate and latest Revenue Records and the detailed Title Certificate to be certified by any reputed advocate of the plaintiff and after making this payment of Rs.1.00 crore, the defendant 21 Com.OS No.4908/2009 No.1 shall deliver all the original Title Deeds pertaining to the entire 106 acres of the land to the plaintiff and then Rs.1.00 Crore should be paid as further advance within 30 days time from the date of previous payment of Rs.1.00 Crore and then out of the remaining sum, Rs.2.00 Crores should be paid directly to the nominee of defendant No.1 within a period of 15 days from the date of defendant No.1 obtaining conversion order from the revenue department converting 106 acres of land from agricultural to non- agricultural/residential purpose and against conveyance of the property in favour of the plaintiff.
14. As could be seen from the materials on record including the recitals of MOU at Ex.P.1, factually defendant No.1 was not owner and title holder of the lands shown in Ex.P.1 when the Ex.P.1 was entered into. It appears defendant No.1 had obtained some agreements of sale from the owners of the land measuring 106 acres. In the MOU itself it is shown that defendant No.1 has been in possession and cultivation of an additional 190 acres of lands since last several years situated adjacent to 106 acres of plot. But, in the written statement and also in examination in chief affidavit of DW.1, it is stated that the said land measuring 190 acres is Gomala land belonges to Government and without bringing this fact to the notice of defendant No.1, plaintiff made the defendant No.1 to enter into such MOU at Ex.P.1 including such Government land measuring 190 acres. This contention of defendants that defendant No.1 was not aware as on the date 22 Com.OS No.4908/2009 of MOU at Ex.P.1 that 190 acres of land is Gomala land and belongs to Government, is nothing but false story stated by the defendants for the reasons that in the cross-examination it is evidence of DW.1 as under:
"AT the time of MOU it was known to me that said land 190 acres belonged to Government."
Thus, it is admission of DW.1 in his cross-examination that he was aware at the time of entering into MOU at Ex.P.1 that land measuring 190 acres belonged to Government. So far land measuring 106 acres, which is shown in the MOU at Ex.P.1, is concerned it is relevant to note that as could be seen from the recitals of the MOU and also oral evidence of DW.1, defendant No.1 was not owner of said land as on the date of MOU. He had taken agreements of sale from its real owners. In the cross- examination in page No.13, it is evidence of DW.1 as under:
"I have not furnished original title reports and original records of said 106 acres of land to the plaintiff."
As per the terms of MOU at Ex.P.1, it was obligatory on the defendant No.1 to furnish original title deeds with the reports to the plaintiff and then plaintiff shall pay Rs.1.00 Crore to the defendant towards consideration amount and then within 30 days defendant No.1 shall get land conversion orders etc., and after furnishing the same to the plaintiff, plaintiff shall pay Rs.1.00 Crore to the defendant No.1 towards consideration amount. There are no materials placed by the defendants to show that defendant No.1 had complied the said obligation. As noted above, it is admitted by DW.1 in his 23 Com.OS No.4908/2009 cross-examination that he never furnished original title deeds of the property measuring 106 acres of land to the plaintiff. Admittedly defendant No.1 has not obtained land conversion order relating to said 106 acres of land. In fact, defendant No.1 had no title in the said land as on the date of MOU. Nothing is placed by the defendants to show defendant No.1 had any sort of right either on the date of MOU at Ex.P.1 or on the date of filing of the suit or as on today, in the lands shown in the MOU at Ex.P.1. In furtherance of MOU at Ex.P.1, out of agreed consideration amount of Rs.5.00 Crores, in the absence of obligations complied with by the defendant No.1, still plaintiff made payment of Rs.3.20 Crores in all to the defendant No.1 towards consideration amount. Even plaintiff has produced letter at Ex.P.2, postal receipts at Exs.P.3 to P.5, postal acknowledgement at Ex.P.6, returned postal covers at Exs.P.7 & P.8, legal notice dated 8.4.2009 issued by his advocate to the defendants at Ex.P.10, returned postal cover at Ex.P.17, application given by the plaintiff to the Post Master at Ex.P.18, reply of Post Master at Ex.P.19, postal acknowledgement and postal receipts at Exs.P.20 & P.21, reply of postal authorities at Ex.P.22 etc. These records disclose that prior to filing of this suit, plaintiff had sent demand letter as per Ex.P.2 to the correct office and residential address of defendant No.1 through registered post and also plaintiff issued lawyer's notice as per Ex.P.10 to the correct addresses of defendants. DW.1 in his cross-examination has admitted that his correct 24 Com.OS No.4908/2009 office and residential addresses are shown in the returned postal covers. This shows despite plaintiff has dispatched his letter as per Ex.P.2 and also lawyer's notice as per Ex.P.10 to the defendants to their correct addresses, but defendants managed not to receive those postal covers and thereby they managed to return back those postal covers. Letter sent by the plaintiff as per Ex.P.2 to the office address of defendant No.1 was served by the authorized representative of the defendant No.1 as per postal acknowledgement at Ex.P.6 and postal authorities have issued letter to the plaintiff along with copy of the letter dated 14.3.2009 given by the defendant No.1 to the postal authorities instructing them to deliver the postal letters sent to his name to his agent by name N.V.Vidyaprasad. Apart from that, as noted above it is admission of DW.1 that his correct office address and residential address are shown in the postal covers. Therefore, it is nothing but defendants have avoided to receive the letter and notice sent by the plaintiff through post. Therefore, these materials clearly show that plaintiff was always ready and willing to perform his part of contract under MOU at Ex.P.1. Therefore, plaintiff is entitled for refund of advance paid amount of Rs.3.20 Lakhs. Plaintiff has claimed interest on this amount at the rate of 24% per annum. But, rate of interest claimed by the plaintiff is excessive and exorbitant. Under the circumstances of this case, it is just and proper to award interest at 18% per annum from the date of suit payable by the defendant No.1 on Rs.3,20,00,000/-. Undisputedly 25 Com.OS No.4908/2009 defendant No.2 is not party to MOU at Ex.P.1. It is the contention of plaintiff that as requested by the defendant No.1, he had made payment of Rs.70.00 Lakhs to the name of defendant No.2, who is son of defendant No.1, by issuing cheques. Therefore, it is say of plaintiff that he made payment of Rs.70.00 lakhs towards consideration amount by issuing cheques to the name of defendant No.2 as per the instruction of defendant No.1. If that is so, it is defendant No.1 alone who is liable to refund amount of Rs.3,20,00,000/- to the plaintiff. For these reasons, Issue Nos.1 & 2 are answered in the 'Affirmative' and Issue Nos.4 & 5 are answered with the answer that plaintiff is entitled to recover Rs.3,20,00,000/- with interest at 18% per annum from the date of suit from defendant No.1 only.
15. Issue No.3 : Plaintiff has filed this suit for recovery of Rs.4,20,47,139/- with interest at 18% per annum. Plaintiff has paid court fee of Rs.4,17,300/-. It is not shown by the defendants as to how court fee paid is not sufficient. Hence, this Issue is answered in the 'Affirmative'.
16. ISSUE NO.6 : For the above discussed reasons and findings to the issue Nos.1 to 5, I proceed to pass the following:-
ORDER Suit of the plaintiff is partly decreed with proportionate cost against the defendant No.1 only.26
Com.OS No.4908/2009 Plaintiff is entitled to recover Rs.3,20,00,000/- from defendant No.1 with interest at 18% per annum from the date of suit till realisation of entire amount.
Defendant No.1 shall pay above amount to the plaintiff. Draw up decree accordingly.
(Dictated to the Judgment Writer, transcribed/typed by her, corrected and then pronounced by me in open Court on this the 26 th day of September, 2019).
(Jagadeeswara.M.), I Addl. City Civil & Sessions Judge, Bangalore.
ANNEXURE
LIST OF WITNESSES EXAMINED FOR PLAINTIFF
PW.1 P. Dayananda Pai
PW.2 P. Harish Kumar
LIST OF DOCUMENTS MARKED FOR PLAINTIFFs
Exs.P-1 Memorandum of Understanding dated. 8.12.2007
" P-2 Copy of letter dated 13.1.2009
" P-3 to 5 Postal receipts
" P-6 Postal acknowledgement
" P-7 & 8 Returned postal covers
" P-9 Letter dated. 23.7.09 issued by HDFC bank
27
Com.OS No.4908/2009
" p.10 Copy of legal notice dated 8.4.2009
" p.11 Certificate of posting
" p.12 to 14 Postal receipts
" p.15& 16 Postal acknowledgement
" p.17 Unservwd postal cover
" p.18 & 19 Letter dated 17.4.2009
" p.20 Postal receipt
" p.21 Postal acknowledgement
" p.22 Reply dated 17.6.2009
" p.23 & 24 Copies of invoices
LIST OF WITNESSES EXAMINED FOR DEFENDANTS :
DW.1 L.R.Shivarame Gowda
LIST OF DOCUMENTS MARKED FOR DEFENDANTS: NIL
(JAGADEESHWARA.M.)
LXXXII Addl.City Civil & Sessions Judge,
Bangalore.
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Com.OS No.4908/2009