Bhagavat Singh G S/o Late Gangadharan v. Syam A, Rakhi L.R and Lalithambika G

RSA 625 & 628 of 2022 1 **IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT** **THE HONOURABLE MRS. JUSTICE M.R.ANITHA TUESDAY, THE 23[RD] DAY OF MAY 2023 / 2ND JYAISHTA, 1945 RSA NO. 625 OF 2022** **AGAINST THE JUDGMENT IN A.S. NO.1/2020 DATED 27.08.2022 OF III ADDITIONAL DISTRICT COURT, KOLLAM AGAINST THE JUDGMENT IN O.S. NO.44/2015 DATED 28.11.2019 OF PRINCIPAL SUB COURT, KOLLAM** ## **APPELLANT/1ST RESPONDENT/PLAINTIFF:** BHAGAVAT SINGH G S/O LATE K.GANGADHARAN, AGED 61 YEARS NOW RESIDING AT "SAROJ GANGA", FIROZ GANDHI LANE, JETTY ROAD, CHERANELLOOR VILLAGE, KANAYANNOOR TALUK, VADUTHALA.P.O, ERNAKULAM-682023. FROM ISWARYA, NEDUNGOLAM, MEENADU CHERRY, PARAVOOR VILLAGE, PIN -691 334 BY ADV BHAGAVAT SINGH G(PARTY-IN-PERSON) ## **RESPONDENTS/2ND RESPONDENT & APPELLANTS/DEFENDANTS:** 1 SYAM A S/O.LATE ASOKAN, AGED 43 YEARS, R.L.SADANAM, NEDUNGOLAM.P.O, MEENADU CHERRY, PARAVOOR VILLAGE, KOLLAM TALUK, PIN-691334. 2 RAKHI.L.R, W/O.SYAM.A AGED 38 YEARS R.L.SADANAM, NEDUNGOLAM.P.O, MEENADU CHERRY, PARAVOOR VILLAGE, KOLLAM TALUK, PIN-691334. 3 LALITHAMBIKA.G, D/O.LATE SAROJINI, AGED 65 YEARS R.L.SADANAM, NEDUNGOLAM.P.O, MEENADU CHERRY, PARAVOOR VILLAGE, KOLLAM TALUK, PIN-691334. BY ADVS. RSA 625 & 628 of 2022 2 V.PREMCHAND SURYA MOHAN P.(K/001967/2019) FATHIMA SHALU S.(K/2636/2021) THIS REGULAR SECOND APPEAL HAVING COME UP FOR HEARING ON 05.04.2023, ALONG WITH RSA.628/2022, THE COURT ON 23.05.2023 DELIVERED THE FOLLOWING: RSA 625 & 628 of 2022 3 # **IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT** **THE HONOURABLE MRS. JUSTICE M.R.ANITHA TUESDAY, THE 23[RD] DAY OF MAY 2023 / 2ND JYAISHTA, 1945 RSA NO. 628 OF 2022** **AGAINST THE JUDGMENT IN A.S. NO.19/2020 DATED 27.08.2022 OF III ADDITIONAL DISTRICT COURT, KOLLAM AGAINST THE JUDGMENT IN O.S. NO.44/2015 DATED 28.11.2019 OF PRINCIPAL SUB COURT, KOLLAM** ## **APPELLANT/APPELLANT/PLAINTIFF:** BHAGAVAT SINGH G S/O LATE K.GANGADHARAN, AGED 61 YEARS NOW RESIDING AT "SAROJ GANGA", FIROZ GANDHI LANE, JETTY ROAD, CHERANELLOOR VILLAGE, KANAYANNOOR TALUK, VADUTHALA.P.O, ERNAKULAM-682023. FROM ISWARYA, NEDUNGOLAM, MEENADU CHERRY, PARAVOOR VILLAGE, PIN -691 334 BY ADV BHAGAVAT SINGH G(PARTY-IN-PERSON) ## **RESPONDENTS/RESPONDENTS/DEFENDANTS:** 1 SYAM A., S/O. LATE ASOKAN, AGED 43 YEARS R.L.SADANAM, NEDUNGOLAM P.O., MEENADU CHERRY, PARAVOOR VILLAGE, KOLLAM TALUK, PIN-691334. 2 RAKHI L.R., W/O.SYAM A., AGED 38 YEARS R.L. SADANAM, NEDUNGOLAM P.O., MEENADU CHERRY, PARAVOOR VILLAGE, KOLLAM TALUK, PIN-691334. 3 LALITHAMBIKA G., D/O. LATE SAROJINI, AGED 65 YEARS R.L.SADANAM, NEDUNGOLAM P.O., MEENADU CHERRY, PARAVOOR VILLAGE, KOLLAM TALUK, PIN-691334. RSA 625 & 628 of 2022 4 BY ADVS. V.PREMCHAND SURYA MOHAN P.(K/001967/2019) FATHIMA SHALU S.(K/2636/2021) THIS REGULAR SECOND APPEAL HAVING COME UP FOR ADMISSION ON 05.04.2023, ALONG WITH RSA.625/2022, THE COURT ON 23.05.2023 DELIVERED THE FOLLOWING: RSA 625 & 628 of 2022 5 ## **JUDGMENT** Dated this the 23[rd] day of May, 2023 RSA No.625/2022 has been filed against the judgment and decree in A.S. No.1/2020 on the file of III Additional District Court, Kollam which was filed against the judgment in O.S. No.44/2015 on the file of Principal Sub Court, Kollam. 2. RSA No.628/2022 has been filed against the judgment and decree in A.S. No.19/2020 which was filed by the plaintiff/appellant against the partial dismissal of O.S. No.44/2015. A.S. No.1/2020 was filed by the defendants against the decree passed partly in favour of the plaintiff. 3. The plaintiff is the appellant. The 3[rd] defendant is the eldest sister and 2[nd] defendant is the daughter of 3[rd] defendant and 1[st] defendant is the husband of the 2[nd] defendant. The defendants on getting information about the proposed sale of properties of the plaintiff at Nedungolam approached the plaintiff and demanded a loan of Rs.10 lakhs RSA 625 & 628 of 2022 6 for constructing a building in the property of 1[st] defendant at Thattamala for letting out to Mayyanad Co-Operative Bank Limited. Though the plan of the plaintiff was to avail a loan of Rs.6 lakhs for the purpose of constructing the house, the defendants requested to avail loan of Rs.16 lakhs in order to advance Rs.10 lakhs to the defendants for a period of two years. The defendants in turn agreed to repay the EMI for the loan regularly without default from monthly rent to be received from the tenant. 4. But ultimately Rs.10 lakhs was advanced from the sale consideration which the plaintiff received on sale of his property. Then 1[st] defendant entrusted two signed blank cheques as security. On 02.05.2011 the defendants 2 and 3 and plaintiff reached at SBT, Paravoor branch and accepted a cheque for Rs.10 lakhs from the plaintiff and encashed Rs.10 lakhs by presenting the cheque given by the plaintiff. Thereafter, the defendants did not pay the EMI as agreed. Defendants paid Rs.2,80,500/- through the account of the plaintiff. Though they constructed the building and let out the RSA 625 & 628 of 2022 7 same to Mayyanad Co-Operative Bank Limited, in spite of the demand by the plaintiff to repay the balance amount it was not repaid. Thereafter, plaintiff filed complaint before the Assistant Commissioner of Police, Chathannoor and City Police Commissioner, Kollam, but with no result. Thereafter, lawyer notice was issued for which a reply was sent raising untenable contentions. Hence the suit. 5. Defendants filed written statement admitting the relationship between the parties. The entire financial transaction alleged by the plaintiff with the defendants is denied. The 1[st] defendant is immensely rich and there is no occasion for him to avail a loan from the plaintiff. The plaintiff had continuous money transaction with the second defendant. Second defendant repaid substantial portion of loan amount together with interest at agreed rate. No receipt was received since the plaintiff is her uncle. The case of the plaintiff regarding the remittance of Rs.2,80,500/- is denied. The cash transaction between the plaintiff and the 2[nd] defendant though closed, there are some disputes with regard to the rate of RSA 625 & 628 of 2022 8 ## interest which resulted in filing the suit. 6. PW1 to PW3 examined and Ext.A1 to Ext.A15 marked from the side of the plaintiff. There was no evidence from the side of the defendants. 7. The trial court on evaluating the facts, circumstances and evidence found that an amount of Rs.4,60,000/- has been paid by the defendants and hence the defendants succeeded to prove partial discharge and the suit was decreed for Rs.5,40,000/- with interest @ 12% and the cost. 8. Against which the defendants 2 and 3 filed A.S. No.1/2020 and the plaintiff filed A.S. No.19/2020. The 1[st] Appellate Court heard the appeals together and a common judgment was passed. A.S. No.1/2020 was allowed and A.S. No.19/2020 was dismissed on the ground that the suit is barred by limitation as per Article 20 of the Limitation Act. 9. Against which the plaintiff approaches this Court in second appeal and this Court admitted the appeal on the following substantial questions of law: RSA 625 & 628 of 2022 9 _i) Whether the findings of the 1[st] Appellate Court that suit is barred by limitation is legally correct?_ _ii) Whether the judgment and decree passed by the_ _1[st] Appellate Court dismissing the suit and that of the trial court decreeing the suit partly is perverse due to mis-appreciation of evidence?_ 10. According to the learned counsel for the appellant, the dismissal of the suit by the trial court on the ground of partial discharge is without appreciating the evidence and the pleadings. Even in the plaint the plaintiff has alleged about the repayment of Rs.2,80,500/- by the defendants and the contention that Rs.2 lakhs was further paid by the defendants is proved to be false by examining PW3 and producing Ext.A5 the cancelled cheque issued in favour of Mini Gangadaran. He would also contend that the finding of the 1[st] Appellate Court that the suit is barred by limitation is also unsustainable, by finding that there is no evidence regarding the period of two years for repayment of loan amount. Article 20 of the Limitation Act is made applicable and the date on which RSA 625 & 628 of 2022 10 cheque issued ie. 02.05.2011 was taken as the starting point of limitation and it was found that the suit filed on 17.04.2015 is after the expiry of three years and hence the suit is barred by limitation which according to the learned counsel is perverse. 11. Learned counsel for the defendants/respondents on the other hand fully supports the findings made by the 1[st] Appellate Court and according to him there is no reason whatsoever to interfere with the judgment and decree passed by the 1[st] Appellate Court. So based on the above the following points arouse for consideration: _1. Whether there is any partial discharge of Rs.4,60,000/- as found by the trial court?_ _2. Whether Article 20 of the Limitation Act is_ _applicable to the facts in issue_ ? ## **Point No.1** 12. The trial court found that PW1 admitted the receipt of Rs.4,60,000/- in his account and plaintiff failed to probablise RSA 625 & 628 of 2022 11 his case that Rs.2 lakhs out of it was credited towards the unpaid purchase price due to PW3. So the learned Munsiff found partial discharge of Rs.4.60,000/-. But the 1[st] Appellate Court taken into account the explanation by PW1 that Rs.2 lakhs deposited by defendant No.2 in his account is the balance amount to be paid to Smt.Mini Gangadharan. PW1 explained that Rs.2,00,000/- which was due to his sister from Mini Gangadharan and in that transaction he stood as a mediator for the balance amount and on receipt of the same and handed over the blank cheque of 2[nd] defendant and he cancelled the same. Mini Gangadharan was also examined as PW3 and gave evidence in corroboration with PW1 with respect to the deposit of Rs.2 lakhs in his account. During cross examination a question was put to her as to whether there is any document to show that Rs.2 lakhs deposited in the account of PW1 was given to her. Then she categorically replied that the document is return of the cheque. The cheque is marked as Ext.A5. It is to be noted that PW3 is none other than sister of PW1 and 3[rd] defendant. Hence, there is nothing RSA 625 & 628 of 2022 12 to disbelieve her. Hence, credit Rs.2,00,000/- in the account of PW1 is properly explained by the plaintiff. So also Rs.2,80,500/- which was deposited in his account by the 2[nd] defendant is also taken into account by the learned Munsiff to find a partial discharge of Rs.4,60,000/- in total. It is to be noted that even in the plaint the plaintiff has given credit to Rs.2,80,500/- deposited by the defendants 1 and 2 and for balance amount that the suit has been filed. So the 1[st] Appellate Court rightly found that the partial discharge of Rs.4,60,000/- found by the trial court is wrong. ## **Point No.2** 13. The 1[st] Appellate Court found that there is no evidence with regard to the period of two years for repayment of the loan amount as alleged by the plaintiff which according to the plaintiff would save the period of limitation. The learned counsel for the appellant/plaintiff bring to my attention the copy of the lawyer notice sent by him to the defendants which is marked as Ext.A9 dated 27.06.2014 wherein he had specifically stated about the two years period of time fixed for RSA 625 & 628 of 2022 13 the re-payment of the amount after advance. In the plaint, in para No.1 also there is specific averment with regard to two years period fixed for re-payment of the amount. The suit has been filed on 07.04.2015 ie. within three years from the expiry of two years period agreed for repayment of the amount and hence limitation would start only after the expiry of the two years period and hence the suit filed is within the period of limitation, the learned counsel contends. 14. The learned counsel for the respondents/defendants on the other hand would contend that the original transaction between the parties is the advance of amount by cheque and encashment of the same by the defendants which is on 02.05.2011. Hence, Article 20 of the Limitation Act would apply and the three years period will start when the amount is paid by cheque ie. on 02.05.2011 and hence the suit filed in the year 2015 is hopelessly barred by limitation. He would also contend that the period of two years agreed for repayment even as per the averment in the plaint is with regard to the advance of amount by availing Rs.16 lakhs by the plaintiff as RSA 625 & 628 of 2022 14 loan from the bank and to provide Rs.10 lakhs out of the loan amount to the defendants. The learned counsel would contend that but the amount advanced by the plaintiff is out of the sale consideration he received and there was no agreement to repay the same within two years when that amount was advanced. 15. It is true that in the plaint in para No.1 there is averment with regard to the plan of advancement of amount to the defendants by availing Rs.16 lakhs from the bank and further to repay that amount within a period of two years. But it is to be noted that in the very next paragraph No.2 there is averment with regard to the request made by the defendants to advance amount from the sale consideration plaintiff received in order to complete the construction of their building in advance. Though there is no specific averment in that paragraph regarding the agreement to repay the amount within two years as in paragraph No.1 of the plaint, it has to be noted that the amount was advanced by the plaintiff from the consideration at the request of the defendants in order to RSA 625 & 628 of 2022 15 complete their construction of the building in advance. It does not mean that the earlier agreement to repay the amount within two years is forgone by the parties while the amount was advanced by the plaintiff out of the sale consideration instead of availing as loan from the bank as agreed earlier. 16. The plaintiff as well as PW2 the witness to the transaction deposed about the two years period fixed for repayment at the time of advancement of amount. The evidence of PW2 who is none other than the sister of the plaintiff as well as the 3[rd] defendant with regard to two years period fixed for repayment is not even challenged during cross examination. The plaintiff also deposed about the period of two years fixed for repayment. In Ext.A9 suit notice send by the plaintiff itself there is specific averment about the demand of the defendants for availing a loan of Rs.10 lakhs for a period of two years. In Ext.A13 reply notice, there is no specific denial of the averment in Ext.A9, notice about the availment of the amount of Rs.10 lakhs for a period of two years, though it is admitted that Rs.10 lakhs was borrowed and two blank RSA 625 & 628 of 2022 16 cheque leaves were issued as security and further raised a contention of discharge of Rs.10 lakhs. In the written statement also there is no specific denial regarding the period of two years fixed for repayment of the amount in between the plaintiff and defendants. Admittedly, the 3[rd] defendant is the eldest sister of the plaintiff and 2[nd] defendant is her daughter and 1[st] defendant is her husband. So, it is quite natural in view of the close relationship of parties that two years period might have been granted for repayment of the loan amount. The evidence of PW1 and PW2 in that regard is only to be accepted. If that two years period is excluded the suit filed is well within the period of three years. So the finding of the 1[st] Appellate Court that apart from the oral evidence of PW1 there is no evidence regarding the period of two years to remit the loan amount is perverse. The 1[st] Appellate Court omitted to appreciate the evidence of PW2 who is none other than the mother's sister of the 2[nd] defendant and sister of the 3[rd] defendant to the effect that as per the understanding the defendants agreed to repay the amount within two years and RSA 625 & 628 of 2022 17 pay the EMI regularly but they cheated without repaying the amount and completed the construction of three storied building and let out the same. 17. **Subanamma Nainan and Others v. George Veeran [2019 (4) KLT 677]** relied on by the learned counsel for the defendants has no application to the case in hand because, that arouse out of a suit for recovery of money and cheque was issued for repayment of debt and in that context it is held that the period of three years of limitation applying to a suit on a dishonored cheque commences from the date of cheque and not from the date on which loan is made. In the present case it has already been found that there was an understanding between the parties to repay the amount within two years from the date of advancement of amount. So the contention of the learned counsel for the defendants that Article 20 would apply and the date of encashment of cheque ie. 02.05.2011 to be taken as the starting point of limitation and hence the suit is barred by limitation since it has been filed on 17.04.2015 is not sustainable either in law or on facts. RSA 625 & 628 of 2022 18 The period of limitation will start only after the expiry of two years of time fixed for repayment of the amount as per Article 113 ie. three years from the date when the right sue accrues. In this case, the right to sue accrues only on the expiry of two years within which the amount was agreed to be paid. 18. So, the suit filed by the plaintiff in the year 2015 is well within the period of limitation and the finding of the 1[st] Appellate Court that the suit is barred by limitation is unsustainable and illegal and hence set aside. 19. Hence, on evaluation of the entire facts, circumstances and evidence adduced it can safely be concluded that plaintiff established the availment of Rs.10 lakhs as loan by the defendants on 02.05.2011 agreeing to repay the same within a period of two years out of which Rs.2,80,500/- has been repaid. Ext.A4(b) would show that the last payment made by 2[nd] defendant is on 21.03.2013 ie. Rs.17,000/-. The balance amount would be Rs.7,19,500/-. Plaintiff is entitled to get interest on the said amount @ 12% from 21.03.2013 till the date of suit and thereafter plaintiff is RSA 625 & 628 of 2022 19 entitled to get future interest @ 6% till relization on the said amount of Rs.7,19,500/- (Rupees seven lakh nineteen thousand five hundred only). Amount already deposited by the defendants shall be adjusted towards the decree amount. In the result, regular second appeals are allowed and the suit decreed in part appellant/plaintiff is entitled to get proportionate cost throughout. Sd/- **M.R.ANITHA JUDGE** SMF RSA 625 & 628 of 2022 20 ## RSA 625/2022 and RSA 628/2022 Paragraph 19 and the next paragraph in the common judgment dated 23.05.2023 in RSA 625/2022 and RSA 628/2022 are recalled and substituted with the following paragraph as per order dated 10.07.2023 in RP 574 of 2023 in 628/2022. “19. On the evaluation of the entire facts, circumstances and evidence, I find that the plaintiff has established the loan transaction of an amount of Rs.10 lakhs. The defendant had agreed to pay the same within two years from 02.05.2011 with interest at the rate of 12%. An amount of Rs.2,80,500/-has been paid by 21.03.2013, by which date, an interest of Rs.2,26,246/- had accrued. The amount paid shall be appropriated towards the sum of Rs.2,26,246/- representing the interest and the balance towards the principal. An amount of Rs.9,45,746/- will be the amount due as on 21.03.2013. It is declared that the appellant/plaintiff is entitled to get interest at the rate of 12% on the amount of Rs.9,45,746/from 21.03.2013 till the date of the suit and thereafter the plaintiff is entitled to get future interest at the rate of 6% till the realization, on the amount of Rs.9,45,746/-. The second appeals are allowed. The suit is decreed with cost throughout”. Sd/- ## **DEPUTY REGISTRAR**