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2010 DIGILAW 813 (KER)

PERERA A. J. v. NALINI NETHIYAR

2010-10-21

M.N.KRISHNAN

body2010
JUDGMENT : M.N. KRISHNAN, J. 1. This appeal is preferred against the judgment and decree passed by the Sub Court, Palakkad in OS No. 482 of 1992. The suit is one for return of the advance amount. The brief facts necessary for the disposal of the appeal are stated as follows: The plaintiff had entered into an agreement with the defendants for the purchase of 4 acres of land for a consideration at the rate of Rs. 500/- per cent and had paid Rs. 57,000/- as advance and there is a further stipulation that the document has to be registered on or before 30/04/1988. It is submitted that deliberately one of the survey numbers is not incorporated in the agreement and the land sought to be assigned really had vested in the forest department by virtue of Act 8 of 1971 and in spite of repeated demands, the defendants did not rectify or satisfy the conscience of the plaintiff regarding the right to assign the property and the plaintiff had sent a notice in October, 1989 cancelling the contract and demanding for the amount. J. On the other hand, defendants would contend that it is the plaintiff, who had committed the breach of contract. Actually the agreement of the year 1988 was a continuation of the agreement of 1986 and the parties were totally aware of the lands involved and the document relating to exemption granted by the forest department has been handed over to the plaintiff and in spite of the same under one ground or the other, the plaintiff had declined to perform the contract and therefore the plaintiff is not entitled to the relief as prayed for. 2. In the Trial Court, PW 1 and DW 1 were examined. Exts. A1 to A3 and B1 to B5 were marked. On analysis of the materials, the Trial Court dismissed the suit. It is against the same, the plaintiff has come up in appeal. 3. Heard the learned counsel on both sides. The young learned counsel for the appellant had forcefully submitted before me that the approach of the Trial Court is totally erroneous and really there is a charge on the property as contemplated under S.55(6) of the Transfer of Property Act, 1882 and therefore there is no limitation to file the suit. 3. Heard the learned counsel on both sides. The young learned counsel for the appellant had forcefully submitted before me that the approach of the Trial Court is totally erroneous and really there is a charge on the property as contemplated under S.55(6) of the Transfer of Property Act, 1882 and therefore there is no limitation to file the suit. The amount has been paid only as an advance amount which forms as a part of the consideration when the transaction goes through and it is not given as a security and therefore it is not liable to be forfeited. It is also contended that it is the breach committed by the defendants and not by the plaintiff. 4. A resolution of the dispute in this case depends upon the question who had committed breach of contract and whether S.55(6) of the said Act will come into the rescue of the plaintiff. If S.55(6) comes into his rescue then there will be an entitlement for a charge which will make the prescribed period of the suit as 12 years. 5. On the contra, if S.55(6) cannot be applied and the benefit given, then the term of the agreement by virtue of Ext. B5 letter had ended on 10th May, 1988 and being a suit for money, it should have been filed 3 years from that date and as the suit is filed only in the month of October, 1992 the suit will be hopelessly barred by limitation. 6. Now let me consider about the breach of the contract. The plaintiff would contend that defendants in spite of repeated requests refused to satisfy the conscience of the plaintiff regarding their entitlement to transfer the property in his favour. He would contend that the very description in Ext. A1 agreement omitting one of the survey numbers 1/8 A1 is a calculated mischief because it has vested in the forest. It is further contended that when an order from the custodian realising this property was sought, no objection certificate was not obtained and given to him and therefore he was unable to proceed with the terms of the contract. A1 agreement omitting one of the survey numbers 1/8 A1 is a calculated mischief because it has vested in the forest. It is further contended that when an order from the custodian realising this property was sought, no objection certificate was not obtained and given to him and therefore he was unable to proceed with the terms of the contract. On the contra, defendants would contend that the parties were totally conscious of the fact regarding the property that was sought to be assigned and the properties obtained by the defendants by virtue of a partition deed wherein F schedule has been set apart to him which covers an extent of 8 acres and 42 cents. It is also submitted that boundaries are given in the agreement and those boundaries will take in the property covered by RS No. 1/8A1 also and so the plaintiff is not taken aback or surprised by the same. Ext. B2 would further reveal that as early as in the year 1975 defendants had obtained an order from the custodian of the vested forest exempting these lands from vesting as per Act 8 of 197. It has to be stated that some of the survey numbers are not seen there. But the contention is that exemption is applied for only to the property relating to or subject to the vesting by the Government order. Therefore it can be seen from the materials available that as early as on 1975 exemption order is obtained there had been a prior agreement between the plaintiff and defendants in the year 1986 with respect to assignment of two acres of land which did not materialise and therefore by intervention of the mediators further agreement was entered which is the subject -matter under Ext. A1. 7. Now what is the conduct of a prudent purchaser is very important in this case. After the execution of Ext. A1, we find that the first record in writing is regarding the demand for return of the advance money in October, 1989. The plaintiff would contend that he has been running from pillar to post to get things done. They had stated about the involvement of this land, but he does not know the survey number. A1, we find that the first record in writing is regarding the demand for return of the advance money in October, 1989. The plaintiff would contend that he has been running from pillar to post to get things done. They had stated about the involvement of this land, but he does not know the survey number. But, in spite of all these things, the plaintiff did not even send a letter to the defendants demanding the documents or rectification of any mistakes which he wanted. But the conduct of the defendants are not like that. Two letters which were sent by the defendants are Exts. B3 and B5. Ext. B3 is a letter addressed to the plaintiff wherein a narration of the previous agreement and the calculated attempt of the plaintiff to get out of the contract, etc. are specifically stated. It is also specifically mentioned in that document that 8 acres and 42 cents of land covered by the partition deed had been exempted from vesting and that a copy of that order has been given to the plaintiff one month before notice. It is also stated that the plaintiff should take steps to get the document registered on or before 30/04/1988. Then comes Ext. B5. It is again a letter addressed by the defendants on 10/05/1988 whereby they reiterated the same allegations against the plaintiff and would submit that unless the document is registered, the plaintiff will loose the right and the agreement will remain cancelled. To the surprise of one and all even for this, the plaintiff did not send any reply. The plaintiff waited for another 17 months to send a notice to the defendants demanding the return of money. That is why it is always said men may lie but circumstances will never lie. The circumstances are classic in this case where the plaintiff has attempted somehow or the other to get away from the contract. There was a stipulation in the agreement that there was loan with the land mortgage bank with this property as charge and the option was either for the plaintiff to satisfy or the defendants to satisfy and get it reduced in the purchase price. The plaintiff did not move his little finger and never pay any amount towards that also. There was a stipulation in the agreement that there was loan with the land mortgage bank with this property as charge and the option was either for the plaintiff to satisfy or the defendants to satisfy and get it reduced in the purchase price. The plaintiff did not move his little finger and never pay any amount towards that also. So, the sum and substance of the entire materials leads to the irresistible conclusion that it was the plaintiff who had been responsible for the breach of contract. 8. Now the learned counsel would contend that the plaintiff is entitled to refund of the amount making the property as charge. As stated by me earlier, unless the plaintiff is entitled to have a charge over the property, the suit will be barred by limitation. Now the learned counsel had brought to my notice a decision of the Kerala High Court 1962 KLJ 257 (kannan Menon v. Kuttikrishna Menon and Others). There the learned Judge refers to a passage from Mulla's TP Act which is extracted as follows: "If the buyer improperly refuses to accept it he loses his charge for the purchase money. But although the buyer loses his charge the seller has no right to retain any instalments of price that have been paid, unless they have been paid as deposit or earnest". So, the above quoted passage makes it very clear that merely by virtue of the fact that the plaintiff is not entitled to protection under S.55(6) it does not ipso facto make the amount forfeited. What the decisions says is that if that amount is realisable then the law permits such realisation unless it is in the form of an earnest money or in the form of a deposit. Now as stated by me earlier, it was on account of the conduct of the plaintiff and the plaintiff alone the agreement did not fructify. The document was not executed because he had committed the breach. He had refused to accept possession and therefore I have no hesitation to hold that he is not entitled to any charge. The learned counsel had submitted the decision of the Supreme Court reported in Delhi Development Authority Vs. Skipper Construction Co. (P) Ltd. and Others. The document was not executed because he had committed the breach. He had refused to accept possession and therefore I have no hesitation to hold that he is not entitled to any charge. The learned counsel had submitted the decision of the Supreme Court reported in Delhi Development Authority Vs. Skipper Construction Co. (P) Ltd. and Others. The Apex Court held that "clause (b) of sub-section (6) of S.55 of the TP Act, provides that in the absence of a contract to the contrary, the buyer will have a charge on the seller's interest in the property which is the subject - matter of the sale agreement insofar as the purchase money and interest on such amount are concerned, unless the buyer has improperly declined to accept delivery". The Supreme Court also held that even if there is conversion, the buyer can proceed against the substituted security. In the case before me, it is the plaintiff who had committed the breach and improperly declined to accept delivery. Therefore he cannot get this benefit. When he is not entitled to any charge over the property then the question of limitation looms very large. The agreement is entered into on 26/01/1988. The time stipulated in the agreement is 30/04/1988. The first notice is issued on 30/04/1988 and Ext. B5 is sent on 10/05/1988. In Ext. B5, there is a unequivocal declaration by the defendants that unless the plaintiff gets the document registered immediately he will forfeit the amount and further the agreement will stand cancelled. So somewhere in the month of May, 1988 the agreement has been terminated. When the agreement has been terminated, the cause of action arises for the plaintiff to sue for the amount. That has to be done within 3 years, i.e. at least by the end of May, 1991. The suit is filed only on 20/10/1992 which is after 17 months. Therefore the claim for money is hopelessly barred by limitation and therefore it cannot be granted. Since I have found that the plaintiff has committed the breach and that he is not entitled to protection under S.55(6) and further that the suit is barred by limitation the other question just like whether the amount paid as advance is earnest money or not does not arise for consideration. Since I have found that the plaintiff has committed the breach and that he is not entitled to protection under S.55(6) and further that the suit is barred by limitation the other question just like whether the amount paid as advance is earnest money or not does not arise for consideration. It has to be remembered that in majority of immovable properties this amount forms a part of consideration for sale and therefore may be strictly earnest money which is liable to be forfeited. But on the technical ground of limitation nothing can be granted to the plaintiff and therefore I am constrained confirm the judgment and decree of the Trial Court and dismiss the appeal by directing the parties to bear their respective costs.