Baby Kalapurayil v. C. NajeeB

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MRS. JUSTICE SHIRCY V.** **TUESDAY, THE 19TH DAY OF MARCH 2019 / 28TH PHALGUNA, 1940** ## **RFA.No. 121 of 2007** **AGAINST THE JUDGMENT AND DECREE IN OS 633/2001 of III ADDITIONAL SUB COURT, ERNAKULAM DATED 19-09-2006** ## **APPELLANT/PLAINTIFF:** **BABY KALAPURAYIL, AGED 45 YEARS, SON OF MATHEW KALAPURAYIL, KALAPURAYIL HOUSE,, AVOLI P.O., MUVATTUPUZHA.** **BY ADV. SRI.PEEYUS A.KOTTAM** ## **RESPONDENT/DEFENDANT** **C.NAJEEB,M/S. NAJEEB ASSOCIATES RESIDING AT THAMMANA HOUSE, S.R.M.ROAD,, ERNAKULAM.** **BY ADV. SRI.TOM K.THOMAS** **THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 18.12.2018, THE COURT ON 19.3.2019 DELIVERED THE FOLLOWING:** RFA 121/2007 2 ## **JUDGMENT** The plaintiff in O.S.No.633/2001 on the file of the Subordinate Judge's Court, Ernakulam (3[rd] Additional Sub Court) is challenging the judgment and decree dated 19.9.2006, whereby his suit was dismissed. The sole defendant is the respondent. 2. Facts relevant for disposal of the appeal are as follows: The defendant is an Architect and Builder of a Multi storied building by name 'Swiss House' at Vazhakala, Ernakulam. He approached the plaintiff and requested to invest in his venture and thus the plaintiff agreed to invest 10,00,000/- on condition that it will be returned with a profit of Rs.8,00,000/- after 2 years from 9.8.1995, the date of the agreement. The plaintiff was entitled to get Rs. 18,00,000/- including profits and out of the same, the defendant effected part payment of Rs.2,50,000/- each on RFA 121/2007 3 24.9.1998 and 18.10.1998. Thereafter a sum of Rs.3,00,000/- was also paid on 10.1.1999. So the balance outstanding is Rs.10,00,000/- with interest. In spite of repeated requests including notice, payment was not effected by the defendant and hence the suit to recover the amount of Rs.10,00,000/- with 18% interest . 3. The defendant admitted the execution of the agreement with the plaintiff but contended that he was not entitled to receive the amount claimed by him. As per the agreement, the plaintiff had the option to market two flats and appropriate the amount invested by him against the value of the apartment remains to be marketed. The plaintiff opted to reserve a flat in the name of his sister-in-law, Smt. Lisa Kalapurayil and the flat was allotted in her name for Rs.11,64,500/-. She paid Rs.3,00,000/- towards the value of the flat and the balance amount due from her was Rs.8,64,500/-. Since only one flat was marketed at the instance of the plaintiff, an amount of Rs.25,000/- was liable RFA 121/2007 4 to be deducted from the amount due to the plaintiff. So after deducting the said amount only Rs.9,75,000/-was due to the plaintiff. But the balance amount of Rs.8,64,500/- due as cost of the flat marketed by the plaintiff ,the same have to be adjusted towards the amount payable to the plaintiff, it could only be Rs.1,10,500/-. The defendant issued two cheques for Rs.50,000/- each in favour of Lisa Kalapurayil and she encashed those cheques. Hence, the balance due to plaintiff was only Rs.10,500/- and the defendant was ready to pay the amount to the plaintiff. The suit was also barred by limitation, was the stand taken by the defendant. 4. Before the court below, the plaintiff and his Power of Attorney Holder were examined as PWs.1 and 2 and Exts.A1 to A4 were marked. DWs.1 to 4 were examined and Exts.B1 to B4 were marked for the defendant. Exts.C1 and C2 were also marked as court exhibits. 5. The court below after considering the relevant materials on record concluded that the plaintiff was not RFA 121/2007 5 entitled to get a decree for the plaint amount. Thus , the suit was dismissed. - 6.Heard both sides 7. Admittedly, the defendant is a builder and architect and he invited the plaintiff to invest for profit in the venture of construction of apartments by name 'Swiss House' at Vazhakkala and thus the plaintiff invested an amount of Rs.10,00,000/- as per an agreement dated 9.8.1995. The agreement and the receipt of an amount of Rs.10,00,000/for construction of 'Swiss House' had been admitted by the defendant. It is pertinent to note that though the execution of Ext.A1 agreement dated 9.8.1995 was admitted, it was contended that the agreement was not legally enforceable. Of course, the plaintiff was not a signatory to Ext.A1 agreement. But it is discernible from Ext.A1 that the defendant was constructing a multi storied building namely Swiss House, and the plaintiff joined the venture by investing an amount of Rs.10,00,000/- towards the capital RFA 121/2007 6 for profit as recited in the agreement. Though a contention was raised by the defendant that as the plaintiff had not signed the agreement, it cannot be termed as a legally enforceable agreement, by placing reliance on the decision in **Alka Bose v. Parmatma Devi and Others [ AIR 2009 SC 1527],** the learned counsel for the plaintiff argued that the agreement is a valid one which is legally enforceable ,as even oral agreement is held to be valid. It has been observed by the Apex Court in this decision that in India an agreement of sale signed by the vendor alone and delivered to the purchaser and accepted by the purchaser had always been considered as a valid contract. In the event of breach of such contract, it can be specifically enforced by the purchaser. So it could be seen that the offer of the defendant that the amount invested by the plaintiff will be returned with profit of Rs.8 lakhs was accepted by the plaintiff in terms of Ext.A1 a legally enforceable agreement and hence the argument of the learned counsel for the RFA 121/2007 7 defendant is only to be rejected. 8. According to the plaintiff as per Ext.A1 agreement including the profit of Rs.8 lakhs offered by him, the defendant was bound to return in total an amount of Rs. 18 lakhs to him. But out of the same Rs.2,50,000/- each was paid on 24.9.1998 and 18.10.1998 respectively and Rs.3,00,000/- on 10.1.1999. The defendant had produced Exts.B1 account book maintained by him with respect to the construction of apartments of the multi-storied building. Ext.B1 pertains to the accounts of his customers who purchased apartments from him as well the accounts pertaining to the persons who invested money in the venture. In page No.34 of Ex.B1, the receipt of Rs.10,00,000/- by the defendant from the plaintiff was seen entered. The payment of Rs.8,00,000/- by the defendant to the plaintiff was also seen entered in the account book and it would show that Rs.2,50,000/- was returned on 24.9.1998 and Rs.2,50,000/- on 18.10.1998. The balance RFA 121/2007 8 of Rs.3,00,000/- was on 10.7.1999. As per Ext.B1, it is also evident that the balance to be settled after deducting the commission of Rs.25,000/- is Rs.9,75,000/-. Ext.B1 is the account book maintained by the defendant himself and the entries were made by him. Therefore, the genuineness of this document was not under challenge. Ext.A2 is the lawyer notice issued by the plaintiff to the defendant dated 5.5.2001. Ext.A3 is the reply notice sent by the defendant to the plaintiff. It is significant to note that in the reply notice he had specifically stated that he had already settled the accounts with the plaintiff. But did not place material before the court to discharge his burden. 9. It is also pertinent to note that he had raised a contention that Smt. Lisa Kalapurayil, the sister-in-law of the plaintiff had purchased an apartment in 'Swizz House' and the said transaction was considered as one marketed by the plaintiff as he was supposed to market two apartments in the building. According to him, the total value RFA 121/2007 9 of the flat purchased by her was Rs.11,64,500/- but she paid only Rs.3,00,000/- out of the same and so the balance due was Rs.8,64,500/-. Therefore, after adjusting the amount of Rs.25,000/- for marketing one flat, the balance is 9,75,000/- and when the balance amount of Rs.8,64,500/- due from Lisa Kalapurayil is adjusted, it is only Rs.1,10,500/- and out of the same, Rs.50,000/- each had been paid by way of two cheques to Lisa Kalapurayil and she encashed it. Then balance is only Rs.10,500/- **.** It is pertinent to note that Smt.Lisa Kalapurayil is not a party to the agreement and purchase of an apartment by her for a total sum of Rs.11,64,500/- has nothing to do with the transaction between the plaintiff and the defendant and therefore, as the value of the flat if any amount is due to the defendant from Smt. Lisa Kalapurayil it cannot be adjusted towards the amount due to the plaintiff from the defendant. 10. The next question to be looked into is whether the RFA 121/2007 10 plaint claim is barred by limitation. According to the learned counsel for the defendant, the date of Ext.A1 was 9.8.1995, but the suit was filed only on 1.11.2001 and hence the claim is hopelessly barred by limitation. Admittedly the last payment of Rs.3 lakhs was on 10.1.1999. As the suit was filed on 1.11.2001 the plaint claim is not barred by limitation. It is also to be noted that the defendant had a contention that after adjusting Rs.25,000/-, the balance due to the plaintiff was Rs.9,75,000/- and when it is adjusted towards the value of the flat, the amount is only Rs.10,500/-. But the defendant has not mentioned any dates with regard to the so called adjustment raised by him. The entries in Ext.B1 regarding the transaction with Smt.Lisa Kalapurayil cannot have any bearing on the transaction with the plaintiff as she was not a party to Ext.A1. 11. Dismissal of the suit on mere technicalities especially by highlighting one or two sentences of the RFA 121/2007 11 plaintiff before the court that he did not authorize anybody to file the suit and that he had no acquaintance with Joshy K.Paul who presented the plaint, is not justifiable. Pertinently, it is to be noted that after the examination of the plaintiff as PW1, the evidence was closed but later it was reopened and the power of attorney holder who presented the suit on behalf of the plaintiff was examined as PW2 and he deposed that he verified the plaint and filed the suit, on behalf of the plaintiff on the strength of Ext.A4 power of attorney executed by the plaintiff in his favour as he was residing abroad. On a re-appreciation of the evidence it could be seen that the transaction between the plaintiff and the defendant had been proved by the plaintiff and entries in Ext.B1 with respect to the transaction of the defendant with Smt.Lissie Kalapurayil had nothing to do with the issue involved and the amount if any due from her cannot be adjusted with the transaction in question and therefore the plaintiff is entitled to get a decree for the amount claimed by RFA 121/2007 12 him .The learned trial judge failed to consider the above aspects. Hence, the judgment and decree under challenge are liable to be set aside and the plaintiff deserves a decree for realization of the amount claimed by him. In the result, the appeal is allowed setting aside the judgment and decree under challenge. The suit is decreed for a sum of Rs.10,00,000/- with interest at the rate of 6% per annum from the date of the suit till realization from the defendant and his assets. The parties shall bear their respective costs. Sd/- 19.03.2019 **SHIRCY V., JUDGE** ks