An agreement that is contrary to public policy is void and unenforceable, and a party to such an agreement cannot maintain an action to recover money paid or property transferred under the agreement.

JUDGEMENT :- The Defendant in O. S. No 1675 of 1974 on the file of the City Civil Court at Madras is the appellant. The respondent-plaintiff filed the suit for the recovery of a sum of Rs. 15,975/- with future interest and costs in the following circumstances.

2. According to the respondent the appellant is a building contractor and was at the relevant time constructing house No. 35, Muthu Gramani Street, Mylapore, Madras-4. He used to apply for loans to the respondent for his construction work. In 1968, the respondent was making attempts to get a seat for her son in the Madras Medical College. The appellant promised to obtain a seat for the respondent's son in the Medical College if the respondent would lend him some money. Accordingly, the respondent paid Rs. 15,000/- in all to the appellant. However. her son could not get a seat in the Medical College. Since the appellant had obtained the money from the respondent on false representation he was bound to repay the same. On 8-1-1971 he also executed Ex. A-1 agreement. undertaking to repay the money on or before 31-3-1971. Since he failed to make the payment, the suit had to be filed by her for the refund of the money.

3. The appellant in his written statement totally denied the averments in the plaint. He never received any money from the respondent as loan. He did not make any promise to the respondent that he would secure a seat for her son in the Medical College. He denied having executed any agreement as alleged in the plaint. He further stated that the respondent was introduced to him by one Dr. Susai, Dr. Susai and the respondent had told him that one Subramaniam of Chintadripet had undertaken to procure a seat for the respondent's son in the Medical College and had received a large sum of money. However, he could not be traced end hence they wanted the help of the appellant in tracing the whereabouts of the said Subramaniam. They could not trace Subramaniam. They therefore began to falsely implicate the appellant and finally took a promissory note executed by him by force with the help of a police officer just on the eve of his son's wedding. Within a few days of the execution of the promissory note the appellant sent a notice to Dr. Susai and the respondent to return the promissory note. The appellant then issued a lawyer's notice on 17-1-1971 and the respondent sent a notice on 3-12-72 claiming the refund of Rs. 15,000/-. He further pleaded that in any event the object of contract being against public policy, the respondent would not be entitled to any relief.

4. The trial court raised the necessary issues for adjudication. The trial court gave the following findings : (1) The appellant received Rs. 15,000/- and executed Ex. A. 1 document; (2) only for aiding and accelerating the effort of obtaining a seat in the Madras Medical College for her son the respondent had paid Rs. 15,000/- to the appellant and in acknowledgment of that payment, the appellant had executed Ex. A.1 and (3) even though the agreement was invalid inasmuch as the respondent was a less guilty party, the parties should be restored to the position in which they occupied prior to the coming into existence of the contract and therefore the appellant should refund the amount he received under the illegal contract. In the result, the trial court decreed the suit. The defeated appellant has appealed to this Court against the Judgement and decree of the trial court.

5. The fact that it has been proved that the respondent had paid a sum of Rs. 15,000/- to the appellant admits of no doubt As per averment in the plaint Rs. 2,000/- was paid in two instalments of Rs. 1,500/- and Rs 500/- in July, 1968 a sum of Rs. 3,000/- in Aug, 1968, a sum of Rs. 5,000/- on 24th March, 1969, and a sum of Rs. 5,000/- on 7th Aug. 1969. Exs. A-2 to A-5 are copies of the bank statements of account in the name of the respondent. They would show that the respondent had withdrawn various amounts on the days mentioned in the p