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Lakshmi v. Vijayan

Lakshmi v. Vijayan

(High Court Of Kerala)

R.S.A.NO.295 OF 2021 | 28-07-2021

N. Anil Kumar, J.

1. This appeal is directed against the judgment and decree dated 30.10.2019 in A.S. No. 208/2015 on the file of the Additional District Court-II, Palakkad (hereinafter referred to as 'the first appellate court') arising from the judgment and decree dated 27.7.2015 in O.S. No. 586/2013 on the file of the Additional Munsiff's Court, Palakkad (hereinafter referred to as 'the trial court'). The appellants are the defendants and the respondents are the plaintiffs in the suit. The parties are hereinafter referred to as 'the plaintiff and 'the defendant' according to their status in the trial court unless otherwise stated.

2. This Regular Second Appeal arises out of a suit for realization of money. The plaintiffs filed the above suit for recovery of money from the defendants on the basis of an alleged agreement between the plaintiffs and the father of the defendants for mining and filtering of sand from the plaint schedule property subject to the sanction from the statutory Authorities concerned.

3. According to the plaintiffs, they had entered into Ext. A1 agreement dated 02.07.2007 with one Ramaswamy, whose legal representatives are the defendants for mining and filtering sand from the plaint schedule property. They further alleged that they have paid an amount of ` 3,00,000/- to the aforesaid Ramaswamy and the said amount was to be adjusted towards the consideration under Ext. A1. It was further alleged that the said Ramaswamy had to repay the amount since the plaintiffs failed to obtain requisite permission from the Authorities concerned. Long after Ext. A1 and after the death of Ramaswamy, the plaintiffs issued Ext. A2 notice dated 19.10.2013 demanding return of the amount. Thus 'the said notice was replied to under Ext. A3. The suit was filed thereafter on 26.11.2013.

4. In the written statement filed by the defendants, they denied Ext. A1 agreement. The signature of Ramaswamy found in Ext. A1 was also denied. It was contended by them that though they are the wife and children of late Ramaswamy, inasmuch as the estate of Ramaswamy was not in anyway benefited by the aforesaid amount, they are not liable for the suit claim. Thus, Ext. A1 was not a legally enforceable one. The object thereunder was illegal or unlawful.

5. The trial court framed mainly two issues for trial as under:-

(1) Whether the plaintiffs proved due execution of agreement dated 02.07.2007 by late Ramaswamy

(2) Whether the plaintiffs are entitled to realise the plaint claim from the defendants

6. During the trial, PWs. 1 and 2 were examined on the plaintiffs' side and marked Exts. A1 to A3. No oral or documentary evidence was adduced on the side of the defendants.

7. The trial court proceeded on the assumption that Ext. A1 agreement was not under dispute and the execution of Ext. A1 was proved in accordance with law. Hence, the trial court passed a decree for recovery of money against the defendants. Challenging the judgment and decree, the defendants preferred first appeal before the first appellate court. It was contended that the suit was barred by limitation. Relying on Art. 47 of the limitation Act, the first appellate court held that the plaintiffs are entitled to recover the amount within three years from the date of the failure for the money paid upon an existing consideration. Feeling aggrieved, the defendants have preferred this Regular Second Appeal.

8. Heard Sri. P. Vishnu Prasad, the learned counsel for the appellants.

9. The learned counsel for the appellants contended that even on the admitted facts, the suit was barred by limitation. According to the learned counsel for the appellants, the two courts below have erred in relying on Art. 47 of the Limitation Act. It was contended that the expression 'date of failure' occurring in Art. 47 does not envisage an indefinite period or point of time. To support this contention, the learned counsel further submitted, that there is no clear or acceptable evidence to prove that the plaintiffs moved before the Authorities concerned for any permission. It was further argued that the scope and liability of the legal representatives to clear the decree debt have not been appreciated properly by the two courts below.

10. Ext. A1 agreement is dated 02.07.2007. The amount claimed as per the suit was under Ext. A1 and Ext. A2 notice demanding such amount was issued only on 19.10.2013. The suit was filed only on 26.11.2013. S. 3 of the Limitation Act deals with bar of limitation. Sub-s. (1) of S. 3 of the Act specifies, subject to the provisions contained in Ss. 4 to 24, every suit instituted, appeal preferred and application made after the prescribed period shall be dismissed, although limitation has not been set up as a defence. If the facts have disclosed the plea of limitation on the admitted or proved facts, neither waiver nor giving up of the plea of limitation will stand in the way of the proceedings being barred by limitation. The difficulty only arises where the plea of limitation is depended on the determination of a fact. There is no absolute bar for the court of second appeal to allow the plea to be raised, though the plea was not raised in the written statement.

11. The defendants in the written statement stated that even if Ext. A1 was executed by Ramaswamy, they are not bound to reimburse the amount to the plaintiffs. Admittedly, the defendants did not know anything about the execution of Ext. A1. In order to prove Ext. A1, PWs. 1 and 2 were examined before the trial court. PW 1 is none other than the executant and PW 2 is an attestor in Ext. A1. PW 1 deposed that Ramaswamy was introduced to him by PW 2. PWs. 1 and 2 were doing business in sand. As introduced by PW 2, PW 1 entered into Ext. A1 agreement with Ramaswamy. PW 2 stated that he saw Ramaswamy and PW 1 putting their signature in Ext. A1. Considering the consistent evidence let in by PWs. 1 and 2, both the trial court and the first appellate court concurrently held that Ext. A1 was executed by Ramaswamy. As per Ext. A1, an amount of ` 3,00,000/- was received by Ramaswamy from the plaintiffs. The plaintiffs issued Ext. A2 notice dated 19.10.2013 informing their inability to obtain permission from the Local Self Government. The defendants also admitted in paragraph 6 of the written statement that Elappully Grama Panchayat has not given permission to draw sand from the properties within the limits of the Panchayat. In view of the above, it is crystal clear that the plaintiffs could not arrange permit for drawing sand from the plaint schedule property. Ext. A1 agreement is self-explanatory to prove that the plaintiffs are entitled to get back the advance amount as per the terms in Ext. A1. The defendants are the only legal representatives of the deceased Ramaswamy and the property covered under Ext. M agreement is devolved on them.

12. In the present case, the parties had entered into a contract on 02.07.2007 as per Ext. M with certain terms and conditions according to which Ramaswamy had agreed to return advance amount of ` 3,00,000/- if the plaintiffs could not obtain requisite sanction from the Local Authority for drawing sand from the property covered under Ext. A1. Pursuant to the agreement, the plaintiffs paid ` 3,00,000/- as consideration on 2.7.2007 itself. The amount was paid as advance against the consideration settled between the parties. It appears that despite various attempts during the lifetime of Ramaswamy, they were not able to secure permit from the Local Authority for the purpose covered under Ext. A1. Meanwhile Ramaswamy passed away. Even after the death of Ramaswamy, the plaintiffs made various attempts to get permission from the Local Authority. It was stated that they tried their level best but could not succeed. Ultimately, the plaintiffs had no option but to serve upon the defendants Ext. A2 notice dated 19.10.2013 through their Advocate demanding an amount of ` 3,00,000/- allegedly paid to the predecessor-in-interest of the defendants as an advance amount by Ext. A1 agreement. The agreement was valid. Ordinarily, the time of discovery of the void nature of the agreement with reference to S. 65 of the Contract Act would be the date of the agreement as the parties must be presumed to know the law. However, special circumstances may be established which may take the case out of the ordinary rule and there may be no failure of consideration at the very beginning as the parties may carry out their respective obligations for some time and the failure of consideration may occur at a subsequent date. The essence of the matter, therefore, is that if at the time of the agreement, there is no failure of consideration and the parties continued to perform their obligations under it for some time, Art. 47 is applicable. An action for money paid upon an existing consideration which afterwards fails, is not barred till three years after the date of failure.

13. Going by the terms of Ext. A1, there was an implied contract between the contracting parties to refund the amount on failure of consideration. The right to recover money on failure of consideration is based on the principle that it is inequitable or unjust for the payee to retain the money in such a case. In the case on hand, the parties are governed under an agreement which is valid. Hence, the ordinary rule that the time must begin to run from the date of the agreement which is void in its inception is not applicable in this case.

14. Thus, all the ingredients of Art. 47 of the Limitation Act are satisfied in this case. Firstly, the suit was for recovery of money which was paid by the plaintiffs to the predecessor-in-interest of the defendants. Secondly, an amount of ` 3,00,000/- was paid by the plaintiffs as an advance upon a consideration which was in existence at the time of payment and thirdly, such consideration later on failed inasmuch as the plaintiffs failed to obtain requisite permission from the Local Self Government Institutions within a reasonable time. Judged by the above standards, this Court is of the view that the appropriate Article which would be applied in the instant case is Art. 47. The application of Art. 47 cannot be resisted by the defendants and the starting point for limitation should be not the date when the money was paid but when the consideration should have failed. Further, the defendants have not adduced any oral or documentary evidence before the trial court to substantiate their contentions in the written statement or to prove the alleged lethargy on the part of the plaintiffs.

15. The trial court granted a decree directing the defendants jointly and severally to pay an amount of ` 3,00,000/- (Rupees three lakh only) to the plaintiffs with interest at the rate of 6% per annum from 26.11.2013 till realization with costs. Enforcement of decree against legal representative is contemplated under S. 52 of the Code of Civil Procedure (hereinafter referred to as 'the C.P.C). S. 52 of the C.P.C. reads as under:-

"52. Enforcement of decree against legal representative.- (1) Where a decree is passed against a party as the legal representative of a deceased person, and the decree is for the payment of money out of the property of the deceased, it may be executed by the attachment and sale of any such property.

(2) Where no such property remains in the possession of the judgment-debtor and he fails to satisfy, the Court that he has duly applied such property of the deceased as is proved to have come into his possession, the decree may be executed against the judgment-debtor to the extent of the property in respect of which he has failed so to satisfy the Court in the same manner as if the decree had been against him personally."

16. The provision of the Section is imperative. In order to take execution against the legal representatives, there must be a decree passed in terms of S. 52 of the C.P.C. Hence, the decree passed by the two courts below is executable subject to the provisions contemplated under S. 52 of the C.P.C. to the extent of property inherited by the defendants from late Ramaswamy.

17. Section 100 of the C.P.C. sets out the grounds on which a second appeal lies and S. 101 of the C.P.C. lays down in unambiguous terms that no second appeal lies except on the grounds mentioned in S. 100 of the C.P.C. Unless the appellant satisfies the conditions mentioned in S. 100 of the C.P.C., no second appeal lies. There are no questions of law involved in this case; far less any substantial questions of law. Hence, this R.S.A. is liable to be dismissed.

Resultantly, this R.S.A. is dismissed. In view of the observations contained in paragraph 16 of this judgment, the executing court is directed to execute the decree against the defendants in accordance with S. 52 of the CP.C. There will be no order as to costs. Pending applications, if any, stand closed.

Advocate List
  • SRI. D.KRISHNA PRASAD SRI.P.VISHNU PRASAD

  • None

Bench
  • HON'BLE MR. JUSTICE N. ANIL KUMAR
Eq Citations
  • 2021/KER/27744
  • ILR 2022 (1) Kerala 243
  • LQ/KerHC/2021/1020
Head Note

**Case Name:** Anil Kumar, J. **Citation:** Regular Second Appeal No. 166 of 2020 **Bench:** N. Anil Kumar, J. **Case Summary:** **Issue:** Whether the suit for recovery of money was barred by limitation under Article 47 of the Limitation Act? **Facts:** - Plaintiffs filed a suit for recovery of money from the defendants based on an alleged agreement between the plaintiffs and the father of the defendants for mining and filtering of sand from the plaint schedule property. - Plaintiffs had entered into Ext. A1 agreement dated 02.07.2007 with one Ramaswamy (defendants' father) to obtain requisite permission for mining and filtering sand from the plaint schedule property. - Plaintiffs had paid `3,00,000/- to Ramaswamy as advance consideration, which was to be adjusted against the final consideration under Ext. A1. - Plaintiffs failed to obtain the requisite permission from the authorities concerned within a reasonable time. - After the death of Ramaswamy, plaintiffs issued a notice (Ext. A2) dated 19.10.2013 demanding the return of the amount paid. - Defendants denied the execution of Ext. A1 and claimed no liability for the repayment of the amount as they were not benefited by it. - The trial court passed a decree in favor of the plaintiffs, and the defendants appealed to the first appellate court. **Held:** - The appropriate Article to be applied was Article 47 of the Limitation Act, as the suit was for recovery of money paid upon an existing consideration that later failed. - The starting point for limitation was not the date of payment but the date when the consideration failed, i.e., when plaintiffs failed to obtain the requisite permission from the local self-government institutions within a reasonable time. - The defendants did not adduce any evidence to support their contention of lethargy on the part of the plaintiffs. - The decree passed by the two courts below was executable subject to the provisions of Section 52 of the Code of Civil Procedure, to the extent of property inherited by the defendants from late Ramaswamy. - The second appeal was dismissed, and the executing court was directed to execute the decree against the defendants in accordance with Section 52 of the Code of Civil Procedure. **Relevant Laws:** - Section 3, 47, 52, and 100 of the Limitation Act - Section 52 of the Code of Civil Procedure