JUDGMENT This regular first appeal has been filed under Section 96 read with Order XLI Rule 1 of the Code of Civil Procedure, 1908 , challenging the decree and judgment dated 30.07.2013 in O.S. No.80/2012 on the files of the Sub Court, Pathanamthitta. The appellant herein is the defendant and the respondent herein is the plaintiff. 2. Heard the learned counsel for appellant and the learned counsel appearing for the respondent, in detail. Perused the verdict under challenge, the records of the trial court and the decisions placed by both sides. 3. Parties in this appeal shall be referred with reference to their status before the trial court. 4. The plaintiff filed suit seeking return of advance money to the tune of Rs.3 Lakh with 12% interest, contending that the defendant has improperly declined to perform his part of contract inspite of willingness of the plaintiff to execute the sale deed in terms of an agreement executed between them on 02.09.2011, whereby it was agreed between the parties to sell the plaint schedule property for a total sale consideration of Rs.11,20,000/-. 5. The defendant resisted the suit by admitting the execution of the agreement. The contention raised by the defendant is that, the agreement could not be executed because of the laches of the plaintiff, though the defendant was ready to execute the sale deed on or before 02.02.2012 as agreed upon by the plaintiff and the defendant. 6. The trial court, on appreciation of rival pleadings, raised necessary issues and tried the matter. PWs 1 and 2 were examined and Exts.A1 to A6 were marked on the side of the plaintiff. DWs 1 to 5 were examined and Exts.B1 to B9 were marked on the side of the defendant. 7. Finally, the trial court found that, even though the plaintiff had been ready and willing to execute the sale deed as agreed upon, the reluctance on the part of the defendant resulted in non-execution of the sale deed and accordingly the suit was decreed as under: 1. The defendant is directed to repay the advance amount of Rs.3 lakh to the plaintiff with interest at the rate of 6% from the date of suit till its realisation from defendant and his asset. 2. By this decree a charge is created on the property attached before judgment. 3. The plaintiff is also entitled for the cost of the suit. 8. 2. By this decree a charge is created on the property attached before judgment. 3. The plaintiff is also entitled for the cost of the suit. 8. The sum and substance of the argument tendered by the learned counsel for the defendant is that, in this matter, though the suit to get back the advance sale consideration has been filed within three years from the date of agreement, the plaintiff did not file suit to get performance of the contract and the same would show that the plaintiff was not ready and willing to execute the sale deed. It is pointed out by the learned counsel for the defendant that, in the agreement for sale marked as Ext.A1, it has been provided specifically that if there was failure on the part of the plaintiff to execute the sale deed, then the advance amount is to be forfeited. The learned counsel for the defendant placed decision of the Apex Court reported in [2012 KHC 4620 : 2012 (4) KHC SN 20] Satish Batra v. Sudhir Rawal , when the Apex Court dealt with a case, where the facts of the case reads as under: The clause, therefore, stipulates that if the purchaser fails to fulfil the conditions mentioned in the agreement, the transaction shall stand cancelled and earnest money will be forfeited. On the other hand, if the seller fails to complete the transaction, the purchaser would get double the amount of earnest money. Indisputedly the purchaser failed to perform his part of the contract, then the question is whether the seller can forfeit the entire earnest money. When we examine the clauses in the instant case, it is amply clear that the clause extracted hereinabove was included in the contract at the moment at which the contract was entered into. It represents the guarantee that the contract would be fulfilled. In other words, 'earnest' is given to bind the contract, which is a part of the purchase price when the transaction is carried out and it will be forfeited when the transaction falls through by reason of the default or failure of the purchaser. There is no other clause militates against the clauses extracted in the agreement dated 29/11/2011. In other words, 'earnest' is given to bind the contract, which is a part of the purchase price when the transaction is carried out and it will be forfeited when the transaction falls through by reason of the default or failure of the purchaser. There is no other clause militates against the clauses extracted in the agreement dated 29/11/2011. We are, therefore, of the view that the seller was justified in forfeiting the amount of Rs.7,00,000/- as per the relevant clause, since the earnest money was primarily a security for the due performance of the agreement and, consequently, the seller is entitled to forfeit the entire deposit. The High Court has, therefore, committed an error in reversing the judgment of the Trial Court. 9. Thereafter, in paragraph No.17 the Apex Court held as under: Law is, therefore, clear that to justify the forfeiture of advance money being part of 'earnest money' the terms of the contract should be clear and explicit. Earnest money is paid or given at the time when the contract is entered into and, as a pledge for its due performance by the depositor to be forfeited in case of non- performance, by the depositor. There can be converse situation also that if the seller fails to perform the contract the purchaser can also get the double the amount, if it is so stipulated. It is also the law that part payment of purchase price cannot be forfeited unless it is a guarantee for the due performance of the contract. In other words, if the payment is made only towards part payment of consideration and not intended as earnest money then the forfeiture clause will not apply. 10. The learned counsel for the defendant also placed earlier Three Bench Decision of the Apex Court reported in [1969 KHC 625 : 1969 (3) SCC 522 ] Shree Hanuman Cotton Mills and Another v. Tata Air Craft Ltd. , which was referred by the trial court in the present case, while considering the term ‘earnest money’. 10. The learned counsel for the defendant also placed earlier Three Bench Decision of the Apex Court reported in [1969 KHC 625 : 1969 (3) SCC 522 ] Shree Hanuman Cotton Mills and Another v. Tata Air Craft Ltd. , which was referred by the trial court in the present case, while considering the term ‘earnest money’. Another decision of this Court in Ambunhi v. Sharada Amma reported in [1974 KHC 98 : 1974 KLT 471 ] has been placed to contend that, Section 74 of the Indian Contract Act, 1872 , concerns compensation for breach of contract, where the amount to be paid in the case of such breach is named or the contract contains any other stipulation by way of penalty. According to the learned counsel for the defendant, the sale deed could not be executed because of the disinclination on the part of the plaintiff alone. Therefore, the amount of Rs.3 Lakh is liable to be forfeited and the suit is liable to be dismissed. 11. Per contra, it is submitted by the learned counsel for the plaintiff that, in the instant case, the suit is filed to get back the advance sale consideration paid in terms of Section 55(6)(b) of the Transfer of Property Act, 1882 [hereinafter referred as ‘TP Act’ for short], where the one and only contingency to be considered is whether the plaintiff has improperly declined to accept delivery of the property. Once it is established that the plaintiff has not improperly declined to accept the delivery of the property and the fault is on the otherside, the amount paid as advance purchase money by the buyer in anticipation of the delivery and for interest on such amount, a statutory charge is created in view of Section 55(6)(b) of the TP Act. 12. 12. In this connection, the learned counsel for the plaintiff has placed decision of this Court in Kannan Menon v. Kuttikrishna Menon and Others reported in [1962 KHC 279 : 1962 KLJ 257 ] , wherein it has been held that, a mere prepayment at the time of a contract for sale does not automatically become an earnest or a deposit by way of security for the performance of the contract and any payment that made of part of the purchase money at the time of the contract for sale, must, even if the blame for its breach is on the buyer, be refunded to the buyer. Another decision of this Court in Ahammedkutty Bran v. Sukumaran reported in [ 2024 (3) KHC 494 : 2024 (2) KLT 199 : 2024 LiveLaw (Ker) 146] also has been placed to buttress the said point. In paragraph No. 13 of the above decision, after referring the earlier decisions, this Court held as under: 13. Thus understanding the scope of the first limb of S.55(6)(b), it is held that, where the nonperformance is not due to the fault of the buyer and the seller, or where both are at blame / default, or where the default occurred at the hands of the vendor, it cannot be said that the buyer has improperly declined to accept delivery and hence he is entitled for charge over the property for the purchase price paid and interest. Of course, whether interest is to be granted and if so at what rate are all matters for determination based on the facts of each case. 13. The learned counsel for the plaintiff placed another decision of this Court in Southern Dredging Co. (P) Ltd v. K. Muhammed Haji reported in [2022 (4) KHC 413] in order to bring home the plea of adjustment, with reference to paragraph No.11 of the decision. Paragraph No.11 reads as under: 11. Thus the legal position regarding adjustment is no more res integra on the point that a plea of adjustment by payment is definitely and essentially a different plea and can be pressed into service only if the same was raised before the institution of the suit and not afterwards. Paragraph No.11 reads as under: 11. Thus the legal position regarding adjustment is no more res integra on the point that a plea of adjustment by payment is definitely and essentially a different plea and can be pressed into service only if the same was raised before the institution of the suit and not afterwards. To determine whether a plea raised in defence is a plea of set off or of payment by adjustment it has to be ascertained as to whether a separate action could be maintained by the defendant on the basis of his claim. If he could institute a separate suit for realisation of the amount due to him, it is a case of set off. If the adjustment was made prior to the filing of the suit by the plaintiff and a plea is taken to that effect, it would be a plea of adjustment by payment. That apart, no pecuniary liability arises till the Court determine that the party complaining of the breach is entitled to damages. The Court in the first place must decide that the other side is liable and then, it should proceed to assess and quantify the liability. Till the said determination, there is no liability at all upon the other side and no 'adjustment' in regard to the damages which is not quantified is liable to sustain. 14. In this matter, the points arise for consideration are: 1. Whether the trial court is justified in holding that the plaintiff has been ready and willing to execute Ext.A1 agreement? 2. Whether the trial court is right in granting the decree for return of advance money, as prayed for in the suit? 3. Whether the advance money is liable to be forfeited as contended by the defendant? 4. Whether the decree and judgment of the trial court would require interference? 5. Reliefs and costs. 15. In the instant case, Ext.A1 is the agreement entered into between the plaintiff and the defendant dated 02.09.2011. As per Ext.A1, the plaintiff agreed to purchase the plaint schedule property for a total consideration of Rs.11,20,000/- and out of which Rs.3 Lakh was paid as advance and the period for execution of the sale deed was fixed as five months. The period expired on 02.02.2012. According to the plaintiff as on 28.01.2012, the plaintiff personally requested the defendant to execute the sale deed on 31.01.2012. The period expired on 02.02.2012. According to the plaintiff as on 28.01.2012, the plaintiff personally requested the defendant to execute the sale deed on 31.01.2012. But the defendant willfully not performed his part of contract, though the plaintiff reached the Sub Registrar ofÏce through one Vasantha Babu, a document writer at Kadampanadu on 31.01.2012 with the balance sale consideration and in order to prove the said contention, he has placed Ext.A6, copy of sale deed No.78/2012 of Kadampanadu S.R.O. executed on 30.01.2012. Thus, the case of the plaintiff is that he had been ready and willing to execute the sale deed within the period agreed upon, but the same could not be executed because of the reluctance on the part of the defendant. 16. Whereas, the contention raised by the defendant is that, the plaintiff was not ready and willing to execute Ext.A1 and thereby he also sustained loss on account of advance paid to one Hari Kumar to purchase his property to the tune of Rs.50,000/- as borne out from Ext.B5 dated 20.10.2011 and also an amount of Rs.25,000/- paid to one Vasanthi to purchase her property, as evident from Ext.B7 agreement dated 03.11.2011. In order to prove Exts.B5 and B7, the said Hari kumar and Vasanthi got examined as DWs 3 and 4 and the execution of Exts.B5 and B7 also proved. 17. In paragraph No.21 of the trial court judgment, the trial court after analyzing the evidence, found that there was no allegation that the defendant was not inclined to enter into Ext.A1 agreement under pressure from the plaintiff and the defendant voluntarily singed on Ext.A1 agreement properly. So, there were no vitiating elements in Ext.A1 contract and the plaintiff was ready and willing to perform his part of contract. It is pointed out by the learned counsel for the defendant that the said finding is not based on correct appreciation of evidence. Per contra, the learned counsel for the plaintiff submitted that, Ext.A6 supported the evidence of PW1 stating that, on 28.01.2012 the plaintiff personally informed the defendant to come before the Sub Registrar OfÏcer, Kadampanadu to execute the sale deed would show the readiness and willingness on the part of the plaintiff. Per contra, the learned counsel for the plaintiff submitted that, Ext.A6 supported the evidence of PW1 stating that, on 28.01.2012 the plaintiff personally informed the defendant to come before the Sub Registrar OfÏcer, Kadampanadu to execute the sale deed would show the readiness and willingness on the part of the plaintiff. Therefore, it has to be held that, the plaintiff not improperly declined to accept the delivery of the property and accordingly the plaintiff is entitled to get back the advance amount in view of Section 55(6)(b) of the TP Act. 18. Insofar as ‘earnest money’ is concerned, in Shri Hanuman Cotton Mills ’s case (supra) it has been held that, 1. It must be given at the time contract is signed 2. It represents a guarantee that the contract will be fulfilled or, in other words, "earnest money" is given to bind the contract. 3. It is part of the purchase price when the transaction is carried out. 4. It is forfeited when the transaction falls through by reason of the default or failure of the purchaser. It has been held further that, unless there is anything to the contrary in terms of contract, on default by purchaser, the seller is entitled to forfeit the earnest money. 19. Earnest money in other contracts is different from earnest money in cases of contract for sale of immovable property. In fact, the amount paid as advance sale consideration can also be referred as ‘earnest money’ in contract for sale provided the said amount is paid or given at the time when the contract is entered into, and as a pledge for its due performance by the depositor to be forfeited in case of non-performance, by the depositor. It is also the law that part payment of purchase price cannot be forfeited unless it is a guarantee for the due performance of the contract. In other words, if the payment is made only towards part payment of consideration and not intended as earnest money then the forfeiture clause will not apply. Section 55(6)(b) of the TP Act is the relevant provision makes charge on the property, as against the seller and all persons claiming under him, in respect of the purchase money paid by the buyer in anticipation of the delivery and for the interest on such amount specifically. Section 55(6)(b) of the TP Act provides as under: 55. Section 55(6)(b) of the TP Act is the relevant provision makes charge on the property, as against the seller and all persons claiming under him, in respect of the purchase money paid by the buyer in anticipation of the delivery and for the interest on such amount specifically. Section 55(6)(b) of the TP Act provides as under: 55. Rights and liabilities of buyer and seller. —In the absence of a contract to the contrary, the buyer and the seller of immoveable property respectively are subject to the liabilities, and have the rights, mentioned in the rules next following, or such of them as are applicable to the property sold: xxx xxx xxx (6) The buyer is entitled— xxx xxx xxx (b) unless he has improperly declined to accept delivery of the property, to a charge on the property, as against the seller and all persons claiming under him, to the extent of the seller's interest in the property, for the amount of any purchase-money properly paid by the buyer in anticipation of the delivery and for interest on such amount; and, when he properly declines to accept the delivery, also for the earnest (if any) and for the costs (if any) awarded to him of a suit to compel specific performance of the contract or to obtain a decree for its rescission. 20. At the same time Section 73 of the Contract Act, 1872, also provides for compensation for loss or damage caused by breach of contract and Section 74 of the Contract Act provides for compensation for breach of contract, where penalty stipulated for. Sections 73 and 74 of the Contract Act reads as under: 73.Compensation for loss or damage caused by breach of contract. —When a contract has been broken, the party who suffers by such breach is entitled to receive, from the party who has broken the contract, compensation for any loss or damage caused to him thereby, which naturally arose in the usual course of things from such breach, or which the parties knew, when they made the contract, to be likely to result from the breach of it. Such compensation is not to be given for any remote and indirect loss or damage sustained by reason of the breach. 74. Compensation for breach of contract where penalty stipulated for. Such compensation is not to be given for any remote and indirect loss or damage sustained by reason of the breach. 74. Compensation for breach of contract where penalty stipulated for. When a contract has been broken, if a sum is named in the contract as the amount to be paid in case of such breach, or if the contract contains any other stipulation by way of penalty, the party complaining of the breach is entitled, whether or not actual damage or loss is proved to have been caused thereby, to receive from the party who has broken the contract reasonable compensation not exceeding the amount so named or, as the case may be, the penalty stipulated for. 21. In the decision of the Apex Court in [AIR 2003 3 SC 2629 : (2003) 5 SCC 705 ] Oil & Natural Gas Corpn. Ltd. v. Saw Pipes Ltd. , while considering the question of compensation and damages, it has been held that principles and considerations for assessment of, in case of breach of contract-in terms of Ss. 73 and 74 of the Contract Act, it can be held that: (1) Terms of the contract are required to be taken into consideration before arriving at the conclusion whether the party claiming damages is entitled to the same. (2) If the terms are clear and unambiguous stipulating the liquidated damages in case of the breach of the contract unless it is held that such estimate of damages/compensation is unreasonable or is by way of penalty, party who has committed the breach is required to pay such compensation and that is what is provided in S. 73 of the Contract Act. (3) S. 74 is to be read alongwith S. 73 and, therefore, in every case of breach of contract, the person aggrieved by the breach is not required to prove actual loss or damage suffered by him before he can claim a decree. The Court is competent to award reasonable compensation in case of breach even if no actual damage is proved to have been suffered in consequence of the breach of a contract. The Court is competent to award reasonable compensation in case of breach even if no actual damage is proved to have been suffered in consequence of the breach of a contract. (4) In some contracts, it would be impossible for the Court to assess the compensation arising from breach and if the compensation contemplated is not by way of penalty or unreasonable, the Court can award the same if it is genuine pre-estimate by the parties as the measure of reasonable compensation. 22. While considering return of advance amount, the cardinal element to be found by the Court is whether the party, who seeks return of advance amount has improperly declined to accept delivery of the property in terms of Section 55(6)(b) of the TP Act? Similarly, when compensation for loss or damages caused by breach of contract is alleged, the Court has the duty to find out who committed the breach and what is the amount of compensation to be granted in terms of Section 73 of the Contract Act? 23. Section 74 deals with a situation to grant compensation for breach of contract, if the sum is named in the contract as the amount to be paid in case of such breach, or if the contract contains any other stipulation by way of penalty, the party complaining of the breach is entitled, whether or not actual damage or loss is proved to have been caused thereby, to receive from the party who has broken the contract reasonable compensation not exceeding the amount so named or, as the case may be, the penalty stipulated for. 24. When coming to contract for sale, it is necessary to harmonize Sections 73 and 74 of the Contract Act with that of Section 55(6)(b) of the TP Act. In order to claim compensation under Sections 73 and 74 of the Contract Act, breach of contract to be pleaded and proved by the party claiming compensation. In order to claim advance purchase money in terms of Section 55(6)(b) of the TP Act, the buyer claiming so has to establish that he did not improperly declined to accept the delivery of the property. 25. In order to claim advance purchase money in terms of Section 55(6)(b) of the TP Act, the buyer claiming so has to establish that he did not improperly declined to accept the delivery of the property. 25. In this case, during cross-examination of PW1, he stated that at the time of execution of the agreement, only photocopy of the title deed of the defendant and tax receipts of the property were handed over to the plaintiff and it was agreed to give the original title deed, after clearing the loan liability. When a question was asked to DW1 in this regard during his cross-examination, his answer was that he did not handover the original title deed, since the pastor of the church advised him to not handover original title deed to anybody. 26. Anyhow, as submitted by the learned counsel for the defendant, no encumbrance to be found in the property. According to the learned counsel for the plaintiff, when the original title deed is deposited by creating equitable mortgage in favour of a Nationalized bank, the same would not depict in the Encumbrance certificate. Therefore, in such cases, Encumbrance certificate could not be the last word to hold that the property is free from liability or encumbrance. 27. In the instant case, even though the forfeiture of advance amount, treating the same as earnest money is the contention raised by the defendant, the ingredients to substantiate the same under Sections 73 and 74 of the Contract Act not established. Otherwise, as provided under Section 55(6)(b) of the TP Act, on establishing that the buyer has improperly declined to accept the delivery of the property, the seller is entitled to forfeit the advance amount. In this matter, the plaintiff’s evidence is that he personally informed the defendant to come before the Sub Registrar OfÏcer, Kadampanadu to execute the sale deed and the defendant did not turn up to execute the sale deed. Ext.A6 document executed on the same day bearing the signature of the plaintiff has been produced in this regard, to prove his presence before the Sub Registrar OfÏcer on the last day provided in Ext.A1 to execute the sale deed. The relevant aspect in this context is the attitude of the defendant. It was agreed between the parties that the liability of the property be cleared before the execution of the sale deed. The relevant aspect in this context is the attitude of the defendant. It was agreed between the parties that the liability of the property be cleared before the execution of the sale deed. As submitted by the learned counsel for the defendant, no visible liability is forthcoming from the evidence available. However, creation of equitable mortgage by depositing the original title deed before a Nationalized Bank for the purpose of availing loan could not be ruled out. The evidence given by the defendant during cross-examination is that, he did not part with the original title deed to the plaintiff as instructed by the pastor of the church. Thus, it has to be inferred that the defendant is hiding something which would show liability to the property and reluctance of the defendant in executing the sale deed as agreed, within time. In such contingency, it could not be held that the plaintiff has improperly declined to accept the delivery of the property, so as to execute the operation of Section 55(6)(b) of the TP Act. Thus, the available evidence would show the readiness and willingness on the part of the plaintiff to execute the sale deed, but not on the side of the defendant. Therefore, it has to be held that, the plaintiff has not improperly declined to accept the delivery of the property and accordingly the plaintiff is entitled to get back the advance amount in view of Section 55(6)(b) of the TP Act. 28. In this connection, it is necessary to address the legal principle of ‘unjust enrichment’. Unjust enrichment is a legal principle that prevents someone from unfairly gaining a benefit at the expense of another person. It is a fundamental legal principle that applies in many common law jurisdictions including India, UK and US. In order to substantiate the claim of unjust enrichment, (1) the plaintiff must prove that the defendant was unjustly enriched at his expense (2) the plaintiff must show that the defendant gained a benefit such as money, property or services free of cost and (3) the plaintiff must also show that it would be inequitable to allow the defendant to keep the benefit, without paying back to the plaintiff. 29. 29. It is true that, by executing Exts.B5 and B7 agreements with DW3 and DW4 for consideration of Rs.50,000/- and Rs.25,000/- respectively to purchase their property in anticipation of the sale of the plaint schedule property by the defendant on getting the balance consideration agreed has been pointed out by the learned counsel for the defendant to establish that the defendant suffered loss on those counts. In fact, the defendant could very well sue against DW3 and DW4 to get back the said amount and if so, it could not be held as a loss to adjust the same from the advance sale consideration paid by the plaintiff. 30. On overall evaluation of the evidence discussed in the facts of this particular case, the trial court rightly found that the plaintiff is entitled to get back the advance sale consideration. The said decree and judgment are only to be justified. Therefore, there is no reason to interfere with the verdict of the trial court. 31. In the result, the appeal stands dismissed and the verdict under challenge stands confirmed. Having considered the facts of the case, both parties are directed to suffer their respective costs. 32 All interlocutory applications pending in this regular first appeal stand dismissed. 33. Since the appeal has been filed as C.M.C.P. and this Court allowed the appellant to proceed with the appeal without paying court fee as indigent persons the appellant is bound to pay court fee in view of dismissal of the appeal. Therefore, Registry is directed to take necessary steps in this regard. The appellant/defendant is directed to pay court fee of Rs.30,985/- (Rupees Thirty Thousand Nine Hundred and Eighty Five only), within a period of one month from today and on failure, Registry is directed to forward a copy of the decree to the District Collector concerned to realise the same from the appellants/defendants, as per law, without fail, at any rate, within a period of two weeks, on completion of one month period to pay the court fee with specific direction to the District Collector to realise the court fee, within three months from the date of receipt of a copy of the decree.