IMPORTANT POINT
The limitation period for filing a suit based on fraud begins when the plaintiff first becomes aware of the fraud, not at the time of execution of the disputed documents.

JUDGMENT :

U. Durga Prasad Rao, J.

1. Assailing the order dated 23.01.2023 in I.A. No.785/2021 in O.S. No.371/2018 passed by the learned II Additional District Judge, Guntur allowing the petition filed by the respondents/defendants 2 & 3 under Order VII Rule 11 and Section 151 CPC and consequently rejecting the plaint, the plaintiff filed the instant appeal.

2. The factual matrix of the case is thus:

(a) The plaintiff filed O.S. No.371/2018 against the defendants 1 to 4 of which D1 is her husband. Her case is that, both the plaintiff and D1 are the practicing Doctors and that apart, D1 is engaged in some business ventures including mining. D2 & D3 who are industrialists approached D1 through D4 and represented that they would make investments along with D1. After several negotiations, D1 agreed to make joint venture with D2 & D3 and with the hope and belief that D2 & D3 will infuse funds, D1 made certain commitments to third parties for expansion of his business. However, D2 & D3 did not keep up their promise. Hence, D1 was in dire straits as third parties were pressing him to fulfill his commitments. This fact was informed by D1 to plaintiff.

(b) While so, when D1 requested D2 & D3 to invest funds, to his shock and surprise D3 made it clear that they would not invest amounts but only advance loan to D1 on the security of a property. As such, D1 convinced the plaintiff to offer the plaint schedule property gifted by her father to her as security. Then D2 & D3 imposed a condition that, they won't accept any mortgage but the secured property should be ostensibly sold to them under registered sale deed for advancing loan, and as and when the loan was repaid, they would re-convey the property. Plaintiff submits that the D1 was in dire situation and though plaintiff did not accept for this proposal, he became fury and made her to agree for this course under influence of D2 & D3 and the plaintiff reluctantly accepted to the dictate of D1.

(c) In those circumstances, the 2nd defendant obtained two registered sale deeds dated 28.11.2014 and 04.12.2014 for Rs.10,65,000/- and Rs.2,75,45,000/- in respect of plaint A & B schedule properties in his favour wherein Sub-Registrar's value was only mentioned though the property is located in the prime area near NRI Medical College at Mangalagiri and its value was 35 crores. The sale deeds were not intended to be acted upon by both the parties and physical possession was also not given to the defendants. Sometime after, the defendants 2 to 4 got mutated revenue records in their favour with the connivance of D1 which fact the plaintiff came to know only before filing the suit. D1 also unwillingly became a party to the fraud and fictitious transactions at the instance of D2 to D4.

(d) It is further averred in the plaint that D2 & D3 advanced a total loan of Rs.14 crores out of which a sum of Rs.2,86,10,000/- was shown as sale transaction for the two sale deeds as per the basic value register and remaining amount was shown as loan and for that D3 obtained pro-notes and cheques from the plaintiff. The plaintiff strongly pleaded that the sale transaction was intended to serve purely as a security for the Rs.14 crores advanced by D3 but not intended to be acted upon and the plaintiff also had no necessity of selling or otherwise parting with the schedule property. Out of Rs.14 crores, D1 returned nearly Rs.2 1/2 crores to D2 & D3 as Rs.12 crores was sufficient to them. The D3 though admitted the amount returned through bank, but did not admit the cash portion and claimed that he adjusted the amount returned towards interest. Due to the said conduct of D2, the plaintiff confirmed that there was a deep rooted fraud played on her by D2 & D3 by making her husband as a tool in that game.

(e) While so, further case of plaintiff is that plaintiff and her husband made arrangements for repayment of the loan and expressed their willingness to D2 & D3 in the last week of September, 2017. Initially, D2 & D3 expressed the