The main legal point established in the judgment is that an agreement can be valid and enforceable, even if it arises in the context of a criminal complaint, as long as it is not opposed to public policy.

M.CHOCKALINGAM, J.

The plaintiff is the appellant herein.

2. This appeal has been preferred by the plaintiff against the judgment and decree passed by the learned Subordinate Judge, Madurai dismissing the suit filed by the plaintiff in O.S.No.452 of 1982 for recovery of a sum of Rs.93,840/- with subsequent interest at 12% per annum on Rs.90,000/- from the date of plaint till realisation.

3. The plaintiff has presented the plaint with the following averments:

The plaintiff and the defendant were working as teachers in Thiagarajar Model Higher Secondary School. The other teachers, the plaintiff and the defendant were conducting a chit and also a welfare fund. Since the defendant, who was in sole management of the chit and welfare fund, left the management on 30.9.1980, the management was entrusted to the plaintiff from 1.10.1980. On assuming the management, the plaintiff scrutinised the accounts and found that a sum of Rs.90,000/- was taken by the defendant for his personal use, and thereby the defendant flouted the trust and confidence reposed on him by the teachers in general. When the plaintiff and other members approached the defendant to reimburse the said amount, he took an hostile attitude and refused to pay the same. The plaintiff has been paying the moneys from out of own funds till the matter was settled with the defendant. The other teachers also were negotiating with the defendant for settlement of the dues. Since the defendant was dragging on the matter, the plaintiff gave a criminal complaint to the police. While the said complaint was pending, the relatives of the defendant and the teachers on verification of the accounts, came to know that an amount of Rs.90,000/- was taken away by the defendant and used for his personal benefit. The defendant wanted two years' time to return the said amount, and he voluntarily executed an agreement on 5.8.1982 undertaking to pay the amount with interest at 12% per annum. The said agreement was executed without any coercion or threat. The withdrawal of the said complaint was was never intended to be a consideration for the said agreement, but was out of pity and leniency shown by the plaintiff towards the defendant so that he may not be deceived. Thus, the agreement was valid and binding on the defendant. The defendant also orally agreed to pay interest every month, and on his failure, the plaintiff has every right to recover the entire amount with interest. The defendant was trying to dispose of the property so that the plaintiff may not be in a position to realise the dues. A notice was sent to the defendant on 10.11.1982, and the same was received by him on 13.11.82. But, the defendant did not care to send any reply. The defendant is liable to pay Rs.93,840/- along with interest at 12% per annum on Rs.90,000/- till realisation.

4. The defendant filed a written statement with the following averments:

The plaintiff, the defendant, P.Jagannathan, P.N.Jothikrishnan, T.M.Mohanram and K.K.Chandrasekar as partners have started a chit fund in the name "Welfare Fund", wherein except K.K.Chandrasekar other partners have invested amounts equally. The said K.K.Chandrasekar, who was a working partner had not invested any amount. Loans were sanctioned to various persons from the fund. Its capital has grown up to Rs.30,000/- within two years. At the time when some of the borrowers did not repay the loan amounts with interest, the plaintiff undertook to collect the amounts and took the accounts in his custody. The said five partners took a loan of Rs.200/- every month from the chit fund conducted by the teachers of Thyagarajar Model Higher Secondary School and handed over the sum to the plaintiff for investment in the welfare fund. The plaintiff had kept the interest amount on the loans taken from the welfare fund. The defendant so far took loans up to Rs.30,000/- from the welfare fund. The welfare fund grew up to Rs.1,25,000/-. Court proceedings were initiated against Kannabiran, Kup