Section 22 of the Specific Relief Act allows for the refund of earnest money or deposit paid when the claim for specific performance is refused, with discretion for the court to allow the plaintiff to amend the plaint for refund of the advance amount at any stage.

JUDGMENT :

(Prayer: This Second Appeal is filed under Section 100 of the Civil Procedure Code, against the judgment and decree passed in A.S.No.58 of 2008 dated 10.10.2011 on the file of the Principal District Judge, Dindigul modifying the judgment and decree passed in O.S.No.339 of 2002 dated 22.10.2008 on the file of the Principal Sub-Ordinate Court, Dindigul.)

1. Aggrieved over the finding of the first appellate Court directing the defendant to refund a sum of Rs.2,35,000/- along with interest, this second appeal is filed.

2. For the sake of convenience, the parties are referred to herein, as per their rank before the Trial Court.

3. The brief facts, leading to the filing of this Appeal Suit, are as follows:-

The defendant has agreed to sell the property to the plaintiff for a total consideration of Rs.2,37,000/- on 14.05.2001 and executed a registered sale agreement on the same day and also received a sum of Rs.2,35,000/- as an advance and to pay the remaining amount of Rs.2,000/-, 15 months time from the date of agreement was stipulated. The plaintiff was always ready and willing to perform his part of contract and issued a legal notice on 03.02.2002. However, the defendant evaded to execute the sale. Hence, the suit has been filed for specific performance.

4. It is the case of the defendant that he has received a sum of Rs.1,50,000/- as loan and agreed to pay the said sum with interest at the rate of 1% and towards the above said loan, the plaintiff insisted an agreement. Accordingly, he has executed an agreement on 21.05.1999. However, the agreement was not intended for sale of the property as per the above agreement dated 21.05.1999 and as per the directions of the plaintiff an another agreement dated 14.05.2001 was also executed for a sum of Rs.2,35,000/-. However, it is the contention that he has never received such amount and he is liable to pay only a sum of Rs.96,000/- with interest at the rate of 1%.

5. Based on the pleadings, the following issues were framed by the trial Court:-

(1) Whether the plaintiff and the defendant have entered into a sale agreement on 14.05.2001?

(2) Whether the agreement was executed only towards the loan transaction?

(3) Whether the plaintiff was entitled for the relief of specific performance?

(4) To what other reliefs?

6. Based on the above pleadings, on the side of the plaintiff P.Ws.1 to 3 were examined and Exs.A1 to A3 were marked and on the side of the defendant P.W1 was examined and Exs.B1 to B8 were marked.

7. On the basis of the evidence and materials, the trial Court dismissed the suit filed for specific performance.

8. It is to be noted that during trial, no alternative relief has been sought. However, when the appeal was pending in A.S.No.58 of 2008, an application to amend the prayer claiming alternative relief appears to have been filed and the same was allowed. Challenging the same, a Civil Revision Petition in C.R.P.(MD)No.5 of 2011 was filed and the same was dismissed confirming the order of the First Appellate Court allowing the petition seeking amendment to claim alternative relief. The First Appellate Court after considering the entire evidence found that the contentions of the appellant that the agreement, dated 14.05.2001 was forcibly executed could not be accepted. On re-appreciation of the entire evidence, the alleged theory of force and coercion was disbelieved by the First Appellate Court and it was also found that the registered agreement was executed by the defendant. The defendant himself has admitted in his written statement that he has executed the agreement. Though it is stated that the agreement is not intended for sale, the execution of the agreement is not disputed. Taking note of the above facts, the First Appellate Court granted a decree for refund of amount received by the appellant i.e., Rs.2,35,000/- as per the agreement with interest. Challenging the same, the present Second Appeal is filed.

9. While admitting the Second Appeal, the following questions of law