Kausalya and Others v. T.N. Parameswaran

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE SATHISH NINAN** **MONDAY, THE 6[TH] DAY OF NOVEMBER 2023 / 15TH KARTHIKA, 1945** **RFA NO. 492 OF 2017** **AGAINST THE JUDGMENT DT. 10.04.2015 IN OS 182/2010 OF SUB COURT,KOCHI** **-----** ## **APPELLANTS/DEFENDANTS:** 1 KAUSALYA, AGED 90, W/O.LATE RAGHAVAN, KALATHIPARAMBIL HOUSE, NEAR GOVERNMENT SCHOOL, PALLURUTHY P.O, KOCHI - 682 006. 2 SANTHOSH, AGED 60, S/O. LATE RAGHAVAN, KALATHIPARAMBIL HOUSE, NEAR GOVERNMENT SCHOOL, PALLURUTHY P.O, KOCHI - 682 006. 3 BINOD, AGED 55, S/O. LATE RAGHAVAN, KALATHIPARAMBIL HOUSE,NEAR GOVERNMENT SCHOOL, PALLURUTHY P.O, KOCHI - 682 006. 4 ANU, AGED 45, W/O. JAYAGOPAN, KALATHIPARAMBIL HOUSE, NEAR GOVERNMENT SCHOOL, PALLURUTHY P.O, KOCHI - 682 006. 5 DR. KANAKAM DILEEPAN, AGED 58, D/O LATE RAGHAVAN, KALATHIPARAMBIL HOUSE,NEAR GOVERNMENT SCHOOL, PALLURUTHY P.O, KOCHI - 682 006. REP. BY P.A. HOLDER SANTHOSH K. RAGHAVAN, S/O LATE RAGHAVAN, KALATHIPARAMBIL HOUSE, NEAR GOVERNMENT SCHOOL, PALLURUTHY P.O., KOCHI-682006. BY ADVS. SRI.G.KRISHNAKUMAR SRI.B.S.SURAJ KRISHNA ## **RESPONDENT/PLAINTIFF:** ## T.N.PARAMESWARAN, **[*DIED – LRs IMPLEADED]** 1 T.N.PARAMESWARAN, **[*DIED – LRs IMPLEADED]** S/O. NARAYANAN, AGED 97, THOTTUNGAL HOUSE,PALLURUTHY, KOCHI - 682 006. **RFA NO. 492 OF 2017 -2-** ## *** ADDL. RESPONDENT NO.2** ADDL. R2 KALA RAMABHADRAN, W/O K RAMABHADRAN, AGED 65 YEARS, NO. 14, PALM GREEN VILLAS, VYTTILA, KOCHI- 682019. ## *** [LEGAL REPRESENTATIVE OF THE DECEASED SOLE RESPONDENT IS IMPLEADED AS ADDL. R2 IN THE APPEAL VIDE ORDER DATED 19.06.2023 IN IA 1/2022]** BY ADVS. SRI.JOLLY JOHN LIZA MEGHAN CYRIAC IRENE BABU THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 06.11.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: **SATHISH NINAN, J. = = = = = = = = = = = = = = = = = = RFA No.492 of 2017** **= = = = = = = = = = = = = = = = = = Dated this the 6[th] day of November, 2023** ## **J U D G M E N T** The decree for specific performance of an agreement for sale is under challenge by the defendants. 2. According to the plaintiff, on 14.05.2010, Raghavan, the late father of the defendants entered into Ext.A2 agreement for sale with the plaintiff in respect of 2.400 cents of property. The sale consideration was fixed at ` 7 lakhs per cent. An amount of ` 2 lakh was paid as advance sale consideration. The period fixed for performance was three months. Raghavan died on 05.08.2010. The defendants refused to honour the agreement. It is accordingly that the suit is filed. 3. The defendants denied the execution of Ext.A2 agreement by their predecessor Raghavan. According to the defendants late Raghavan was aged 93 years at the time of Ext.A2 agreement and was suffering from dementia. He was not competent to enter into Ext.A2, is RFA No.492 of 2017 -: 2 :- the contention. It was also contended that the consideration fixed under Ext.A2 is very low when compared to the market value of the property. 4. The trial court negatived the contention of the defendants regarding the mental capacity of late Raghavan. It was noticed that there is no evidence to prove the allegation of incompetency of Raghavan to enter into the contract (Ext.A2). The trial court also noticed that, in March and April, 2010, Raghavan had carried out transactions in his bank account. It is also held that, inadequacy of consideration is not a sufficient reason to hold against Ext.A2 agreement. 5. I have heard learned counsel Sri.G.Krishna Kumar on behalf of the appellants-defendants and Sri.Jolly John, the learned counsel for the respondent-plaintiff. The points that arise for determination are:- _(i) Is the finding of the trial court with regard to competency of late Raghavan to enter into Ext.A2 agreement, sustainable on evidence?_ RFA No.492 of 2017 -: 3 :- _(ii) Has there been failure by the trial court to exercise the discretionary jurisdiction vested in it under Section 20 of the Specific Relief Act to consider whether a decree for specific performance is liable to be granted ?_ _(iii) Do the materials on record justify exercise of discretion under Section 20 of the Specific Relief Act to grant a decree for specific performance ?_ 6. Firstly I proceed to consider the contention regarding the mental competency of Raghavan to enter into Ext.A2 agreement. The signature of late Raghavan in Ext.A2 agreement is not in dispute. It is the contention that late Raghavan was suffering from dementia and was not competent to enter into Ext.A2 agreement. The documentary evidence relied on by the defendants to prove the contention are Ext.B2 series emails and Ext.B4 medical prescription. It is claimed that in May 2007 Raghavan went to the United States of America in connection with the marriage in his daughter's (D5) family. His daughter, the 5[th] defendant, is a RFA No.492 of 2017 -: 4 :- Psychiatrist. She diagnosed that Raghavan was suffering from dementia. The said fact was communicated to the other children of Raghavan through Ext.B2 series e- mails. The said e-mails were at a point of time when there were no disputes between the parties. After Raghavan returned home, he was prescribed medicines by the wife of the second defendant, who is a Doctor, in consultation with the Psychiatrist, Dr.Venugopal. The medical condition and the treatment of Raghavan has been narrated in detail by DW3-the 4[th] defendant in the proof affidavit. There is absolutely no challenge with regard to the same in cross-examination. In the circumstances, the evidence amply proves that Raghavan was suffering from dementia and was incompetent to enter into Ext.A2 agreement has been established, it is contended. 7. The fact that Raghavan went to USA in May 2007 as contended by the defendants, is evidenced by Ext.B3 passport of late Raghavan. So also, as argued by the learned counsel for the defendants, the medical RFA No.492 of 2017 -: 5 :- condition and treatment of late Raghavan, though elaborated in the chief affidavit of DW1 and DW2 viz. the 4[th] and 5[th] defendants, there is absolutely no challenge in the cross examination. However, a reading of Ext.B2 series e-mails indicate only that late Raghavan was a “Paranoid” and was not suffering from dementia as alleged. There is no material on record to suggest that a paranoid is incompetent to enter into contract. Even the medical literature produced by the defendants along with Ext.B2 series does not suggest so. There is no material to find that late Raghavan was incompetent to enter into Ext.A2 agreement. The finding of the trial court in the said regard is justified on the available materials. Point No.1 is answered accordingly. 8. Section 20 of the Specific Relief Act as it stood prior to 2018 Amendment reads thus:- RFA No.492 of 2017 -: 6 :- _“_ _**20. Discretion as to decreeing specific performance** .⸻(1) The jurisdiction to decree specific performance is discretionary, and the court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal._ _(2) The following are cases in which the court may properly exercise discretion not to decree specific performance:⸻_ _(a) where the terms of the contract or the conduct of the parties at the time of entering into the contract or the other circumstances under which the contract was entered into are such that the contract, though not voidable, gives the plaintiff an unfair advantage over the defendant; or_ _(b) where the performance of the contract would involve some hardship on the defendant which he did not foresee, whereas its non-performance would involve no such hardship on the plaintiff; or_ _(c) where the defendant entered into the contract under circumstances which though not rendering the contract voidable, makes it inequitable to enforce specific performance.”_ RFA No.492 of 2017 -: 7 :- Section 20 vests jurisdiction on the court to consider whether a decree for specific performance is to be granted or refused in a given case, based on the circumstances. The discretion is to be exercised on judicial principles considering whether it will be fair, just and equitable to grant a decree. A decree for specific performance is not necessarily to be granted merely because it is lawful to do so _[See_ _**Parakunnan Veetill Joseph's Son Mathew v. Nedumbara Kuruvila's Son (1987 Supp SCC 340), Gobind Ram v. Gian Chand (2000) 7 SCC 548, Sardar Singh v. Krishna Devi (1994) 4 SCC 18** ]_ . A reading of the judgment of the trial court shows that the court has, after finding the execution of the agreement and the readiness and willingness of the plaintiff to proceed with the agreement, straight away granted a decree for specific performance. The jurisdiction vested in the court under Section 20 of the Specific Relief Act has not been exercised by the court. Thus there has been failure on the part of the court to exercise jurisdiction vested in RFA No.492 of 2017 it by statute. Point No.2 is answered accordingly. 9. As has been discussed while answering the point number 1, there is no material to find that late Raghavan was suffering from dementia and was incompetent to enter into Ext.A2 agreement. However, the evidence indicates that Raghavan was suffering from some form of mental illness-Paranoid. Evidence of the defendants viz. the oral evidence of DW1 and DW2 and also the contents of Ext.B2 series and B4 medical prescription proves the same. As noticed earlier, the elaborate evidence of DWs.1 and 2 in the said regard have not been disputed/ challenged in cross-examination. The evidence, oral and documentary, indicates that Raghavan was suffering from the mental condition-Paranoid at the relevant time. From the medical literature annexed to Ext.B2 series e-mails it is seen that the state of paranoid includes “confusion” and “forgetfulness”. The contention of the defendants that the plaintiff and late Raghavan were very thick friends, is not disputed. According to the RFA No.492 of 2017 -: 9 :- defendants, on an earlier occasion, the plaintiff taking advantage of the medical condition of late Raghavan had attempted to enter into an agreement for sale in respect of the property. Ext.B1 is the agreement. Ext.B1 is signed only by the plaintiff. According to the defendants, the plaintiff came to the residence of Raghavan with Ext.B1 and the defendants on noticing the same and with their timely intervention could avoid the plaintiff from prevailing over late Raghavan from entering into the agreement. It is accordingly that the defendants got possession of Ext.B1 agreement. The fact that Ext.B1 agreement was proposed to be entered into between the plaintiff and late Raghavan, is admitted by the plaintiff. However, it is his case that late Raghavan stated that the agreement was misplaced. It is thereupon that Ext.A2 agreement was executed. 10. The advance sale consideration under Ext.A2 agreement was paid into the bank account of late Raghavan. If the amount was paid in cash, his family RFA No.492 of 2017 -: 10 :- would have come to know about the transaction. With regard to the payment of the advance sale consideration into the bank account of Raghavan, the reason suggested by PW4 at page 4 of his proof affidavit is that Raghavan was not on good terms with the family and that he cannot maintain the amount in safe custody at home. However, in paragraph 3 of the plaint, it is averred that the agreement has been executed by Raghavan with the full knowledge, information, and consent of defendants. It is possible that it was to prevent anybody else from knowing about the transaction that the amount was paid directly into the bank account of Raghavan. This is possible since admittedly Ext.B1 did not culminate in an agreement due to the intervention of the defendants. 11. It is pertinent to note that, in spite of the contention of the defendants with regard to the mental condition of late Raghavan at the relevant time, the plaintiff has abstained from the witness box. His sonin-law was examined as the power of attorney holder. No RFA No.492 of 2017 -: 11 :- reason was suggested in the proof affidavit of PW1 regarding the non-examination of the plaintiff. In his cross-examination it is stated that, the plaintiff was not examined due to inability to walk consequent on his old age. However, nothing prevented the plaintiff from being examined through a commission if his difficulty was with regard to movement. The non-examination of the plaintiff assumes significance in the background of the contention regarding the mental condition of late Raghavan and also the failure to go ahead with Ext.B1 agreement. The learned counsel appearing for the plaintiff would argue that, on the facts of the case at hand since the execution of Ext.A2 agreement and the readiness and willingness of the plaintiff to go forward with Ext.A2 agreement is not in dispute, there was nothing further required to be proved by examination of the plaintiff, to get a decree for specific performance. Therefore, the non-examination of the original plaintiff is inconsequential, it is urged. RFA No.492 of 2017 -: 12 :- 12. In the cross-examination of PW1, it has been deposed that he has no direct knowledge about the transaction and that he is aware of the same only as told by the original plaintiff. Therefore, PW1 is incompetent to depose about the matters relating to Ext.A2 agreement. The non-examination of the original plaintiff, in the circumstances stated above has much relevance and significance. 13. Ext.A2 agreement recites that the advance sale consideration of ` 2 lakhs was paid on 14.05.2010. However, the specific plea at paragraph 4 of the plaint is that the amount was paid on 13.05.2010. The plea reads thus:- _“4. The terms of the agreement between the parties are thus reduced into writing. As per the agreement said Raghavan has received an amount of Rs. 2,00,000/-(Rupees Two Lakh only) from the Plaintiff as advance from the sale consideration. Said advance amount of Rs. 2,00,000/- (Rupees Two Lakh only) has been deposited in the account maintained by said Raghavan with the Dhanalakshmi Bank, Palluruthy Branch on 13-05-210_ RFA No.492 of 2017 -: 13 :- _as per his specific direction and the same is specifically mentioned and acknowledged in the agreement. …..”_ In tune with the same is the proof affidavit of PW1. The above is contradictory. 14. The learned counsel for the respondentplaintiff would argue that, the evidence on record, at best, could only indicate that the defendants were not ready to go ahead with the transaction. The evidence has to be construed in the light of the contention regarding the mental condition of late Raghavan. The fact that Raghavan had operated his bank account in March and April, 2000 could at best be relied on to contend that Raghavan was competent to enter into Ext.A2 agreement. It has already been concluded while answering point No.1 that there is no material to find that Raghavan was incompetent to enter into Ext.A2 agreement. 15. PW1 in his cross-examination has admitted that another item of property, which is situated behind the RFA No.492 of 2017 -: 14 :- plaint schedule property, which does not have any road frontage or access, was sold two years prior to Ext.A2 agreement for an amount of ` 6.75 lakhs per cent. PW1 admits that there was no road access to the said property. It is to be noticed that plaint schedule property has National Highway road frontage for the entire length. Therefore, definitely the plaint schedule property would fetch much higher value than the said property on the rear side which did not even have any road access. So also Ext.A2 agreement was executed after a lapse of two years from the transaction relating to the said property at the rear side. This also has significance while considering the contention of the defendants with regard to the mental condition of late Raghavan. 16. What is relevant is, appreciation of the circumstances involved to find whether the plaintiff is entitled for the exercise of discretion for grant of a decree for specific performance. The circumstances RFA No.492 of 2017 -: 15 :- noticed above would justify the exercise of discretion to deny the relief of specific performance. This is a fit case where specific performance is to be declined. The trial court has failed to consider the above circumstances and determine whether discretion for grant of specific performance is to be exercised in plaintiff's favour. I hold that the plaintiff is not entitled for the discretionary relief of specific performance. Point No.3 is answered accordingly. 17. The contention of the defendants that plaintiff and late Raghavan were intimate friends is not seen disputed. Here it is worthwhile to note that Raghavan died on 05.08.2010, and Ext.A4 notice was issued by the plaintiff on 09.08.2000, and the suit was filed on 24.09.2010. In spite of the fact that they were very thick friends, the undue haste in which the plaintiff has acted, also assumes relevance. 18. The plaintiff has claimed an alternate relief for return of the advance sale consideration with RFA No.492 of 2017 -: 16 :- interest. The payment of an amount of ` 2 lakhs on 14.05.2010 under Ext.A2 agreement is not in dispute. No circumstance is pointed out to decline refund of the said amount to the plaintiff. So also there is reason to deny interest on the said amount. Considering the prevailing rate of interest in banking transactions, grant of interest at the rate of 12% from the date of agreement till date of suit and thereafter at the rate of 9% till date of decree, and thereafter at the rate of 6% per annum till realisation is just and proper. The plaintiff is entitled to realise the amount, charged on the plaint schedule property. In the result, this appeal is allowed. The decree and judgment of the trial court are set aside. The plaintiff is granted a decree for realisation of an amount of ` 2 lakhs with interest at the rate of 12% per annum from 14.05.2010(the date of payment) till 25.09.2010(date of suit), and thereafter at the rate of 9% per annum till the date of decree (06.11.2023), and RFA No.492 of 2017 -: 17 :- thereafter at the rate of 6% per annum till realisation, charged on the plaint schedule property and from the defendants. Parties to bear their respective costs. Sd/- **SATHISH NINAN JUDGE** kns/- //True Copy// P.S. to Judge