M. VENKATESH v. KISHORE JATARAM — 1998 DIGILAW 73 (KAR)

H. N. TILHARI, J. ( 1 ) THESE four first appeals arise from the common judgment and decree dated 31-1-1989 passed by Sri R. S. Futane, xviii additional city civil judge, Bangalore, decreeing the plaintiffs claim for the sum of money with interest at 6% p. A. Claimed by the plaintiff-respondent in each case respectively i. e. , in o. s. No. 2339 of 1983, o. s. No. 2340 of 1983, o. s. No. 2348 of 1983 and o. s. No. 2349 of 1983. In other words, the trial court decreed the suit No. 2339 of 1983 for a sum of Rs. 30,900/- with interest at the rate of 6% p. a. , decreed suit No. 2340 of 1983 for a sum of Rs. 38,600/- with interest at the rate of 6% p. a. , decreed suit No. 2348 of 1983 for a sum of Rs. 30,9007- with interest at the rate of 6% p. a. and decreed suit No. 2349 of 1983 for a sum of Rs. 30,900/- with interest at the rate of 6% p. a. ( 2 ) THE facts of the case are almost common. According to the plaintiffs' case, in all the four cases, the defendant-appellant entered into an agreement of sale on 29-7-1980. In case No. 2339 of 1983, he agreed to sell site nos. 12 and 17 formed out of the land in sy. No. 68/4, h. s. l. No. : 323, nagasettihalli, ii stage, rajmahal vilas, for a sale consideration of Rs. 55,860/- and received a sum of Rs. 20,000/- as advance. In case No. 2340 of 1983, the defendant-appellant vide agreement dated 29-7-1980 agreed to transfer site nos. 23 and 24 formed in the same land i. e. , 6874 as mentioned above for a sale consideration of Rs. 63,3157- and the defendant-appellant received a sum of Rs. 25,0007- as advance. In o. s. No. 2348 of 1983 under the agreement of sale of the same date, the defendant agreed to sell and the plaintiff agreed to purchase site nos. 10 and 11 out of the aforesaid land i. e. , sy. No. 68/4 for a sale consideration of Rs. 55,860/- and the plaintiff-respondent paid and the defendant-appellant received a sum of Rs. 20,000/- as advance. With reference to o. s. No. 2349 of 1983 under the agreement of sale dated 29-7-1980, the defendant agreed to sell site nos. 10 and 11 out of the aforesaid land i. e. , sy. No. 68/4 for a sale consideration of Rs. 55,860/- and the plaintiff-respondent paid and the defendant-appellant received a sum of Rs. 20,000/- as advance. With reference to o. s. No. 2349 of 1983 under the agreement of sale dated 29-7-1980, the defendant agreed to sell site nos. 18 and 19 formed out of sy. No. 68/4 for a sale consideration of Rs. 55,860/- and the defendant-appellant received a sum of Rs. 20,000/- as advance from the plaintiff-respondent. Under the agreement, there were certain terms and conditions which have to be fulfilled by the defendant-appellant. The plaintiffs' case as pleaded in all these cases is that, subsequently plaintiff came to know that the defendant has no title to transfer these properties as well as he had not secured the requisite permission from the b. d. a. nor has he obtained provision for water supply etc. The plaintiff issued notice to the defendant-appellant that in view of the defect in the vendors title and absence of needful sanction from the b. d. a. and provision for water and sewerage which has not been obtained by the defendant-appellant, plaintiffs-respondents cancelled these agreements on account of breach of conditions committed by the defendant-appellant. The plaintiffs as such, in all these matters gave the notice to the defendant-appellant demanding refund of the amount which the plaintiffs had advanced to the defendant-appellant as has been mentioned above. The defendant did not comply with the notices, instead he gave the reply to the notices and denied the very fact of having entered into agreements dated 20-7-1980. Thereafter, the plaintiffs filed these four suits for recovery of the amount that has been advanced under the four agreements which was the subject-matter of those four suits. Plaintiff claimed refund of the amount advanced with interest at the rate of 18% p. a. on the notices/ summons being served, the defendant-appellant filed the written statement taking some pleas. ,i have gone through the written statements. The only contention that has been stated is that the defendant has complied with the terms and conditions and that one nandalal ram- das was instrumental in instigating the plaintiffs-respondents to file the suit. At one stage, a plea was also taken that he was authorised by the respective owners to enter into transaction. The only contention that has been stated is that the defendant has complied with the terms and conditions and that one nandalal ram- das was instrumental in instigating the plaintiffs-respondents to file the suit. At one stage, a plea was also taken that he was authorised by the respective owners to enter into transaction. He mentioned that all the amount of advance have been paid to the respective owners of the property and that they had executed the sale-deeds respectively. The defence was taken that plaintiffs were not entitled to maintain the suits and claim for refund of the amount of advance with reference to each agreement. ( 3 ) ON the basis of the pleadings of the parties, the trial court framed the material issues in the four suits which read as under : issues in o. s. No. 2339 of 19831. Whether the plaintiff proves that the defendants committed breach of the conditions of the agreement to sell?2. Whether the defendant proves that he has fulfilled all the conditions as stated in the written statement in respect of the agreement to sell?3. Whether the plaintiff is entitled to return of Rs. 20,000/- advance?4. Whether the plaintiff is entitled to interest? If so, at what rate?5. To what amount?6. What decree or order?issues in o. s. No. 2340 of 19831. Whether the plaintiff proves that the defendant has refused to perform his part of the contract as per the agreement dated 29-7-1980?2. Whether the plaintiff proves that the defendant is liable to refund the amount of advance of Rs. 25,000/- with interest at 18% p. a. ?3. Whether the plaintiff is entitled to suit claim?4. To what reliefs the parties are entitled to?issues in o. s. No. 2348 of 19831. Does defendant prove as contended in para 3 of the written statement that the suit sale agreement has been fully complied with by him?2. Does defendant prove that the original suit sale agreement remained with the plaintiff and that the same is being misused by the plaintiff in this suit as contended in paras 3 and 4 of the written statement?3. Does plaintiff prove having performed his part of the contract under the suit sale agreement?4. Does plaintiff prove that he was entitled to put an end to the contract as contended in para 3 of the plaint, and claim compensation?5. Does plaintiff prove having performed his part of the contract under the suit sale agreement?4. Does plaintiff prove that he was entitled to put an end to the contract as contended in para 3 of the plaint, and claim compensation?5. If so, is the plaintiff entitled to compensation of Rs. 20,000/-?6. If so, is the plaintiff further entitled to interest thereon at 18% p. a. from the date of contract?7. To what other relief or reliefs is plaintiff entitled?8. What decree? Or order?issues in o. s. No. 2349 of 19831. Whether the defendant had refused to perform his part of the contract in not giving a reply to the legal notice dated 25-2-1983 regarding the good title in respect of the sites agreed to be sold in favour of the plaintiff by defendant?2. Whether the sites mentioned in the agreement were given different numbers by the b. d. a. ?3. If so, whether the said sites were sold by the defendant to the plaintiff by registered sale deed dated 20-1-1981?4. To what relief the plaintiff is entitled?5. What order or decree? ( 4 ) AFTER having considered the material on record, the trial court answered the issues as under : O. S. No. 2339 of 1983 Issue No. 1 Affirmative; Issue No. 2 Negative; Issue No. 3 Affirmative; Issue No. 4 Affirmative; Issue Nos. 5 and 6. As per final order. O. S. No. 2340 of 1983 Issue No. 1 Affirmative; Issue No. 2 Negative; Issue No. 3 Affirmative; Issue No. 4 As per final order. O. S. No. 2348 of 1983 Issue No. 1 Negative Issue No. 2 Negative; Issue No. 3 Affirmative; Issue No. 4 Affirmative; Issue No. 5 Affirmative; Issue No. 6 Affirmative; Issue Nos. 7 and 8 As per final order. O. S. No. 2349 of 1983 Issue No. 1 Affirmative; Issue No. 2 Negative; Issue No. 3 Negative; Issue Nos. 4 and 5. As per final order. ( 5 ) AFTER having answered the issues as indicated above, the trial court decreed all the suits filed by the plaintiff-resondent as has been mentioned above. The defendant-appellant has come up in appeal before this court. He has filed four appeals arising from each suit. 4 and 5. As per final order. ( 5 ) AFTER having answered the issues as indicated above, the trial court decreed all the suits filed by the plaintiff-resondent as has been mentioned above. The defendant-appellant has come up in appeal before this court. He has filed four appeals arising from each suit. The learned counsel for the appellant contended before me that the suits have been illegally decreed as the defendant-appellant had paid all the advances received by him by the plaintiffs to the owners of the respective properties and that the respective owners of the properties have also sold or transferred the properties to the plaintiffs-respondents. Therefore, the plaintiffs are not entitled to the decree and the decrees have been passed by the court below erroneously. The learned counsel contended that the appellant had been authorised by the respective owners to enter into transaction of sale or agreement to sell and so he received the advance and paid to the persons concerned. ( 6 ) THESE contentions of the appellant's counsel have hotly been contested by the learned counsel for the respondents Sri S. G. Bhagavan. Sri Bhagavan contended that the purchases of the plots which alleges to have been made by the plaintiffs-respondents not from the defendant but from real owners. The learned counsel for the respondents contended that the defendant-appellant represented himself to be the owner of those sites and obtained the advance and executed an agreement to sell those sites and the plaintiff-respondents relied on the defendant-appellant's representation and entered into agreement and advanced to the defendant the money. Later, investigation revealed that the defendant -appellant was not the owner and it was misrepresented. So they gave the notice to the defendant to refund the money. He cannot claim the benefit of any transaction of sale that have been made by two of the owners of the sites in favour of the present plaintiffs of suits nos. 2339 of 1983 and 2340 of 1983. The learned counsel further contended that money has been taken by the defendant-appellant from the plaintiffs-respondents in his own capacity alleging himself to be the owner of the plot. 2339 of 1983 and 2340 of 1983. The learned counsel further contended that money has been taken by the defendant-appellant from the plaintiffs-respondents in his own capacity alleging himself to be the owner of the plot. When the defendant-appellant has not been the owner and misrepresented himself and obtained money from the plaintiffe-resondents, the learned counsel for the respondents Sri Bhagavan contended that the agreement is based on misrepresentation and has, been void and the plaintiffs-respondents have asked the defendant-appellant for refund of money. The learned counsel submitted that it was never indicated either in the agreement or otherwise that the defendant-appellant was entering into agreement as the agent of some different persons instead the defendant-appellant represented himself to be the owner of the sites in question. So in view of the Provisions of sections 65 and 70 of the Contract Act, the defendant-appellant is bound to refund and the court below rightly decreed the suit. Learned counsel for the respondents contended that there is no question of any wrong instigation given by anybody. He submitted that when under the agreement money has been taken by the defendant-appellant as advance and when agreement appears to have been void then as money had not been paid gratuitously. The defendant- appellant is bound to refund and the trial court rightly decreed the suit. ( 7 ) I have applied my mind to the contentions of the learned counsel for the parties. A perusal of ex. D. 21 to ex. D. 25 reveals the basis of the suit are the agreements for sale dated 29-7-1980 which are ex. P. 5, ex. P. 6, ex. P. 7 and ex. P. 8 on record. A perusal of these exhibits per se reveals that these agreements were entered into by the defendant representing himself not as an agent of anybody, but he executed those deeds representing himself to be the owner in possession of the sites in question and on this representation, the parties agreed to the terms contained in the deed. Nowhere in these deeds it has been indicated that the defendant-appellant entered into agreement in the capacity other than the owner. Nowhere in these deeds it has been indicated that the defendant-appellant entered into agreement in the capacity other than the owner. This factum could not be denied by the appellant's counsel that the representation was made by the defendant-appellant to be the owner of the property and he obtained money advanced, while it is admitted that owners of the property of sites are different persons. I may mention that owners were not being produced by the defendant-appellant in support of his case to show that really they had authorised him (defendant) to enter into agreement and the advance money received by the appellant has been transferred to them and on the request of the defendant-appellant, they executed the sale-deeds in pursuance of that transaction entered into by the defendant-appellant. Had they been produced by the defendant-appellant, there might be something worth consideration. Learned counsel for the appellant invited my attention to ex. D. 21 to ex. D. 25 and had contended that these are the documents which prove that money was paid. Money received from the plaintiffs had been paid to the respective owners. Learned counsel contended that vouchers are itself for sites having been purchased. But, it is immaterial. No doubt, no evidence has been produced to prove these drafts. But even if it is taken that these drafts are real, whether these payments were made in relation to or with reference to the agreement entered exhibited by ex. P. 5 to ex. P. 8, they cannot be linked with that transaction in absence of any evidence being produced on that behalf and particularly on account of non-production of site owners. Defendant's counsel submitted that these owners were related to him. They are near relatives of the defendant-appellant. Why they have not been produced, no reason has been given. If these persons were near relatives of the defendant-appellant and if for no reason they have not been produced, it indicates that had they been produced, their statement would have gone against the defendant-appellant's case. So adverse presumption has to be taken against the defendant-appellant. Apart from this, it also appears that the money in the form of advance had been obtained by misrepresentation of ownership of land. The defendant-appellant had no title to the property. But, he represented himself to be the owner of the sites and obtained money. So adverse presumption has to be taken against the defendant-appellant. Apart from this, it also appears that the money in the form of advance had been obtained by misrepresentation of ownership of land. The defendant-appellant had no title to the property. But, he represented himself to be the owner of the sites and obtained money. As such, these agreements are voidable at the instance of the plaintiff-respondent. There is no dispute about the fact that the defendant-appellant had no title. He could not agree to sell and as such, the agreements being void or having become void in view of the Provisions of Section 65 of the Contract Act, it was the obligation of the defendant-appellant to have refunded the money and to have restored the benefit he had obtained on that voidable agreement. Section 65 of the Contract Act reads as under:"section 65. Obligation of person who has received advantage under void agreement, or contract that becomes void. When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it, or to make compensation for it, to the person from whom he received it". ( 8 ) IN view of the Provisions of Section 65 of the Contract Act and law against unjust enrichment under Section 70 of the Contract Act, in my opinion, the defendant-appellant has been bound to restore back the money and loss. I mean to say that loss which the plaintiffs-respondents suffered during this period commencing from 29-7-1980 to the date of suit and thereafter. This could be compensated only by awarding of interest. In this view of the matter, the trial court has been justified in decreeing the plaintiffs' suit for refund of the advance sums as indicated above as per the agreements which the defendant-appellant had received under those agreements along with interest thereon which had been awarded at the rate of 6% p. A. Though plaintiffs-respondents had claimed 18% p. a. had the plaintiffs-respondents filed cross-objections, I could have considered the contention as to question of enhancing the same from 6%. Any way, no cross-objections having been filed, it appears just and proper to confirm the decree passed in all the suits and dismiss all the appeals. Any way, no cross-objections having been filed, it appears just and proper to confirm the decree passed in all the suits and dismiss all the appeals. In the result, all the four appeals are hereby dismissed with costs and the trial court's decrees in all the suits are hereby confirmed. Whatever interim order if granted shall stand vacated and be deemed to have become extinct. --- *** --- .