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2020 Supreme(Mad) 1091
IN THE HIGH COURT OF MADRAS AT MADURAI BENCH
N. Sathish Kumar, J.
S. Lokeshwaran and Ors. – Appellants
Versus
S. Veluchamy and Ors. – Respondents
A.S.(MD) No. 132 of 2019 and C.M.P. (MD) No. 6140 of 2019
Decided On : 20-02-2020
Advocate Appeared:
For the Appellant :M. Vallinayagam, Senior Counsel for K. Appadurai, Advocate
For the Respondent:S. Meenakshi Sundaram for S. Srinivasa Raghavan, Advocate
Headnote:
Transfer of Property Act, 1882 - Section 55(6)(b) - Suit for Specific Performance - Possession and enjoyment of Suit property - Sale Agreement - Suit property belong to people and First Defendant is one of members - He was also Representative - First Defendant was in possession and enjoyment of Suit property - His possession was recognized - First Defendant representing said entered/an Agreement with Plaintiff to sell Suit property for a Total Sale consideration - A sum of Lakh was paid by Plaintiff by way of Demand Draft - Subsequently another five lakh rupees paid - In pursuant to same Sale Agreement was executed in favor of Plaintiff agreeing to sell Suit property - On date of Agreement another sum was paid – Hence Plaintiff has paid towards Sale consideration - Time was not an essence of Contract - As time was not made essence of Contract Plaintiff was patiently waiting for Defendant to complete Sale Deed – Though Power of Attorney was executed in favor of wife of Plaintiff was desiring to purchase property based on Sale Agreement – Held, Admittedly Plaintiff has paid which is also established by records – Though prayer for refund of Advance amount is belatedly asked and allowed by this Court it is to be noted that such relief could be granted at any stage of proceedings to amend Plaint - As Advance amount was originally paid there will be a charge on interest in property in respect of Sale Agreement insofar as the purchase money is concerned. Of course, the charge is dependent upon the performance of conditions stipulated under Section 55(6)(b) of Transfer of Property Act, 1882 - Therefore it cannot be said that amendment is barred by limitation - In any event this Court is of view that Defendants particularly Defendants 1 to 3 themselves having not disputed payment they are bound to return amount received towards Sale consideration though it is stated that as remaining Sale consideration has not been paid within certain period of Auction amount has been fortified - It is further to be noted that Ex. A1 to 3 makes it clear that a sum has been paid only towards Sale consideration not as an Earnest Deposit to carry out certain obligation on part of Plaintiff - When money has been paid as a Sale consideration and when Plaintiff has filed a Suit for Specific Performance Court can very well order return of amount to Plaintiff even when Suit for Specific Performance is dismissed – Accordingly Defendants 1 to 3 being President Secretary and Member of Society who dealt property on behalf of are bound to return their amount - First Defendant being and amount also being received by under Ex. A1 & B3 Defendants 1 to 3 are liable to return above amount with Interest at rate from date of amount till date of realization - Appeal is partly allowed
JUDGMENT :
N. Sathish Kumar, J.
1. Aggrieved over the Decree and Judgment of the Trial Court, decreeing the Suit for Specific Performance, the present Appeal came to be filed.
2. The brief facts leading to the filing of this Appeal are as follows:
2.1. The Suit property belong to Karaikudi Nattar Samudhayam people and the First Defendant is one of the members of the Karaikudi Nattar Samudhayam. He was also Representative of the Karaikudi Nattar Nala Urimai Sangam. The First Defendant was in possession and enjoyment of the Suit property. His possession was recognised by the Karaikudi Nattar Sangam. The First Defendant representing the said Sangam entered/an Agreement with the Plaintiff to sell the Suit property for a Total Sale consideration of Rs. 16 Lakhs. A sum of Rs. 1 Lakh was paid by the Plaintiff on 21.3.2005, by way of Demand Draft. Subsequently, another five lakh rupees paid to the Sangam on 3.10.2005.
2.2. In pursuant to the same, the Sale Agreement was executed in favour of the Plaintiff on 10.3.2006, agreeing to sell the Suit property. On the date of Agreement, another sum of Rs. 1 Lakh was paid. Hence, the Plaintiff has paid Rs. 7 Lakhs towards the Sale consideration. The time was not an essence of Contract. As the time was not made essence of Contract, the Plaintiff was patiently waiting for the Defendant to complete the Sale Deed. Though, the Power of Attorney was executed in favour of the wife of the Plaintiff on 6.6.2006, the Plaintiff was desiring to purchase the property based on the Sale Agreement. The Plaintiff was always ready and willing to perform his part of the Contract, but the Defendant was evading. When the Plaintiff being the proposed party applied for encumbrance, he came to know that the property was sold on 16.5.2006. Hence, his contention is that execution of Power of Attorney by Second and Third Defendants in favour of the Fifth & Sixth Defendants is legally unlawful. The Sale Deed executed in favour of the Fifth & Sixth Defendants is also not binding on them. The Plaintiff was always ready and willing to perform his part of the Contract.
2.3. Originally, relief of Specific Performance was sought. Thereafter, the relief was amended in the Appeal stage seeking alternative remedy for return of Advance amount with Interest at the rate of 12%. The First Defendant filed a Statement, denying all the allegations that one PR. Subramaniyan @ Subbu was representing the Sangam. It is his contention that only the Second Defendant RM. Somasundaram is the representative of the First Defendant Sangam and has been the President of the Sangam for 10 years. The First Defendant has no right to represent the Sangam. The Second Defendant being the President of the Sangam, had no individual right in the Suit property. The First Defendant PR. Subramaniyan @ Subbu is not the necessary party.
2.4. The value of the Suit property is Rs. 1. Crore. The property belong to. Karaikudi Nattar. Sangam. Originally, in the Auction conducted by the Sangam, the Plaintiff agreed to purchase a property for Rs. 17 Lakhs and agreed to pay the remaining Sale consideration within a week. However, he has not paid the amount. Thereafter, he paid Rs. 5 Lakhs on 3.10.2005 and agreed to pay the remaining Sale consideration the next day. The Cheque issued by the Plaintiff was also dishonoured. As the remaining Sale consideration is not paid, the Advance amount also forfeited. The Plaintiff has no capacity to mobilise the remaining funds. On expressing his inability to mobilise funds, the Second & Third Defendants took the property in Auction. Thereafter, the property had been sold to the Fifth & Sixth Defendants by the Fourth Defendant, who is the Power of Attorney of the Defendants 2 & 3.
2.5. The Defendants 5 & 6 filed a Written Statement stating that the Plaintiff was a successful bidder in the Auction conducted by the Sangam and agreed to purchase the property for Rs. 17 Lakhs. Thereafter, he has not paid the amount within the time. Only thereaft
