Vinod v. Chellappan Pillai Ramachandran Nair and Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** # **PRESENT** **THE HONOURABLE MR. JUSTICE SATHISH NINAN** **FRIDAY, THE 11[TH] DAY OF NOVEMBER 2022 / 20TH KARTHIKA, 1944** **RSA NO. 207 OF 2010** **AGAINST THE JUDGMENT IN AS 12/2005 OF III ADDITIONAL DISTRICT COURT,** ## **TRIVANDRUM** **OS 75/2003 OF SUB COURT,NEYYATTINKARA** ## **-----** ## **APPELLANT IN RSA/APPELLANT IN AS/DEFENDANT NO.6 IN SUIT:** VINOD, S/O KARUNAKARAN NADAR, RESIDING AT PAYATTUVILA LEKSHMANA VILASOM, KOOTTUKAL DESOM, KOTTUKAL VILLAGE, NEYYATTINKARA TALUK, THIRUVANANTHAPURAM. BY ADVS. SRI.K.JAYAKUMAR (SR.) SRI.N.AJITH SMT.GEETHA P.MENON SRI.P.B.KRISHNAN SRI.P.M.NEELAKANDAN SRI.R.SURAJ KUMAR ## **RESPONDENTS IN RSA/RESPONDENTS IN AS/PLAINTIFF & DEFENDANTS 1 TO 5 & 7 IN** ## **SUIT:** 1 CHELLAPPAN PILLAI RAMACHANDRAN NAIR, RESIDING AT RENJINI, KOLLAKKONAM, KOTTUKAL DESOM, KOTTUKAL VILLAGE, NEYYATTINKARA. 2 SUNDAR FINANCE, A PARTNERSHIP FIRM, REPRESENTED BY MANAGING PARTNER, K.S.SANAL, FUNCTIONING AT UCHAKKADA, KOTTUKAL VILLAGE, NEYYATTINKARA. 3 K.S.SANAL (WRONGLY SHOWN IN THE JUDGMENT AS S.S.SANAL), MANAGING PARTNER OF SUNDHAR FINANCE, A PARTNERSHIP FIRM, RESIDING AT SUNDAR BHAVAN, VENGANOOR, VIZHINJAM VILLAGE, THIRUVANANTHAPURAM. 4 K.R.JAYA, D/O.KARTHIYANI, PARTNER OF RESPONDENT NO.2, RESIDING AT MOHANA SADANAM, KIDARAKKUZHY, VENGANOOR DESOM, VIZHINJAM VILLAGE, THIRUVANANTHAPURAM. **RSA NO. 207 OF 2010 -2-** 5 T.R.JAYAKUMAR, S/O.THANKAYYAN NADAR, PARTNER OF RESPONDENT NO.2, RESIDING AT THENGUNATTA VILA VEEDU, KATTACHAKKUZHI, VENGANOOR VILLAGE, THIRUVANANTHAPURAM. - 6 KUMARAN NADAR RAJAYYAN NAIR, **[STRUCK OFF FROM THE PARTY ARRAY]** PARTNER OF RESPONDENT NO.2, RESIDING AT IN DO. DO. ***** 7 NARAYANA PILLAI SUKUMARAN NAIR, RESIDING AT ATTUKADAVU KIZHAKKATHIL VEEDU, FORT WARD, KADAVATTARAM DESOM, NEYYATTINKARA VILLAGE, THIRUVANANTHAPURAM. **[STRUCK OFF FROM THE PARTY ARRAY]** ## *** [THE NAME OF RESPONDENTS 6 & 7 ARE STRUCK OFF FROM THE PARTY ARRAY AS PER ORDER DATED 13.01.2011 IN RSA 207/2010]** BY ADVS. SRI.MANU V. for R1 SRI.G.P.SHINOD THIS REGULAR SECOND APPEAL HAVING BEEN FINALLY HEARD ON 11.11.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ## **SATHISH NINAN, J.** **= = = = = = = = = = = = = = = = = = R. S. A. No.207 of 2010** **= = = = = = = = = = = = = = = = = = Dated this the 11[th] day of November, 2022** ## **J U D G M E N T** The sixth defendant in a suit for setting aside a Sale Deed and for specific performance of an oral agreement for re-conveyance, is the appellant. The suit was concurrently decreed by the courts. 2. Defendants 2 to 5 are the partners of the first defendant firm. The firm is engaged in finance business. The plaintiff availed a loan of ` 2 lakhs from the firm. For the grant of loan, the plaintiff was required to furnish security in the form of a sale deed of immovable property executed in favour of a person to be suggested by the firm. This was on the agreement that, on repayment of the loan amount with interest, the property will be re-conveyed to the plaintiff. Pursuant to such agreement, on 02.06.1997, the plaintiff executed Ext.A9 Sale Deed in favour of the third defendant. As per the **R. S. A. No.207 of 2010** **==> picture [34 x 9] intentionally omitted <==** agreement the plaintiff was to repay an amount of ` 4,16,000/- in 36 monthly instalments. In terms thereof, three instalments were paid. Then it was learnt that the business of the first defendant firm was closed. It was also understood that the third defendant had executed Ext.A1 Sale Deed in favour of the sixth defendant based on Ext.A9 purporting to convey the property. The said conveyance is vitiated by fraud. The property is liable to be re-conveyed in terms of the agreement for re-conveyance. It is accordingly that the suit is filed. 3. The sixth defendant-appellant herein asserted the genuineness of Exts.A9 and A1 Sale Deeds and contended that the plaintiff is not entitled for the relief of specific performance. It was contended that the present suit is barred by res judicata in the light of the judgment in OS 471/1999, which was a suit filed by the 6[th] defendant against the plaintiff for injunction. **R. S. A. No.207 of 2010** -: 3 :- 4. The trial court, noticing that OS 471/1999 was only for a prohibitory injunction against trespass, negatived the plea of res judicata. The oral agreement for re-conveyance as pleaded by the plaintiff was found, and the suit was decreed. The appellate court concurred with the findings of the trial court. 5. Heard learned Senior Counsel Sri.K.Jayakumar on behalf of the appellant and Sri.Shinod G.P. on behalf of the first respondent on the following substantial question of law:- _“Is the finding of the courts below on the genuineness_ _of oral agreement for re-conveyance solely on the principle of non-traverse, or is the finding supported by materials ?_ 6. Defendants 1 to 5 viz. the financing firm and its partners failed to appear in the suit. They remained ex parte. The case of the plaintiff is that, Ext.A9 Sale Deed was executed as a security for the financial transaction with the firm, with an agreement for reconveyance on repayment of the debt. The persons who **R. S. A. No.207 of 2010** **==> picture [34 x 9] intentionally omitted <==** could deny the transaction and agreement, no doubt, are defendants 1 to 5. Their failure to appear and controvert the plaintiff's case is of significance. However, as submitted by the learned Senior Counsel, the mere non-filing of the written statement by itself need not entail a judgment against the defendants. The court needs to be satisfied about the genuineness of the plaint claim. _**(** See_ _**Shantilal Gulabchand Mutha v. Tata Engineering and Locomotive Company Ltd. and Ors. 2013 (4) SCC 396, Maya Devi v. Lalta Prasad AIR 2014 SC 1356).**_ Were there any materials based on which the courts have arrived at the findings, needs to be considered. 7. The plaintiff has given oral evidence as PW1. He has spoken about the nature of the transaction. Ext.A6 is the tax receipt relating to the property dated 31.01.1998 ie. after Ext.A9 Sale Deed. The fact that the plaintiff himself paid tax for the property after Ext.A9, points in favour of the plaintiff's case. That apart, the plaintiff himself has produced Exts.A3 and **R. S. A. No.207 of 2010** **==> picture [34 x 9] intentionally omitted <==** A5, the prior deeds relating to the property. Exts.A3, A5 and A6 goes a long way in proving the case of the plaintiff that Ext.A9 was intended only as a security. 8. The sixth defendant claims to have purchased the property from the third defendant. It is not in dispute that the sixth defendant is a close relative of the second defendant. It is also to be noticed that Ext.A9 sale deed dated 02.06.1997 and Ext.A1 sale deed dated 11.03.1998 are for the same value. Exts.A10 to A12 coupled with Exts.A13 to A17 prove that defendants 1 to 5 have been entering into similar transactions with persons who borrowed money from them, and culminated in suits and decrees by Courts, against them. This is to be understood along with the non-appearance of defendants 1 to 5 and their failure to controvert the plaint allegations. The findings of the Courts are not merely on the theory of non-traverse but, are on materials. Substantial question of law is answered accordingly. **R. S. A. No.207 of 2010** -: 6 :- 9. Order VI Rule 4 of the Code of Civil Procedure requires particulars to be pleaded when fraud is alleged; except for vague allegations of fraud, no particulars are stated, submits the learned senior counsel. The circumstances leading to execution of Ext.A9 document, the agreement of re-conveyance, and the alienation in spite of the same etc. have been pleaded in the plaint. It cannot be said that the reasons on which the plaintiff alleges fraud has not been provided. That apart, a plea of fraud may not be of much relevance if it is found that there was an oral agreement for reconveyance unless, it is found that the vendee was a bona fide purchaser for value and without notice of the agreement. 10. Pertinently, there is no plea for the sixth defendant that he is a bona fide purchaser for value and without notice of the agreement for sale. As noticed supra, he is a close relative of the third defendant; Exts.A9 and A10 conveyances are for the very same value. **R. S. A. No.207 of 2010** **==> picture [34 x 9] intentionally omitted <==** The prior title deeds relating to the property are still with the plaintiff; the purchaser-6[th] defendant has not even cared to obtain the prior deeds of the property. Hence in the background of the case as noticed above, even such a plea could only be negatived. 11. Both the courts have appreciated the entire evidence on record, evaluated the circumstances involved, and rightly concluded about the nature of transaction and the oral agreement for re-conveyance. The appreciation of evidence cannot be said to be perverse. There is no merit in the Second Appeal. Resultantly, the Regular Second Appeal fails and is dismissed. Sd/- **SATHISH NINAN JUDGE** kns/- //True Copy// P.S. to Judge