Case title:
Ahammedkutty Bran v. Sukumaran & Anr.
Date of Order:
27th February 2024
Bench:
Hon’ble Mr. Justice Sathish Ninan
Parties:
Appellant/Plaintiff: Ahammedkutty Bran
Respondent(s)/Defendant(s): 1. Sukumaran
2. Swapna Subhash
SUBJECT:
The Hon’ble High Court of Kerala (hereinafter referred to as ‘the High Court; or ‘the Court’) adjudicated a case revolving around an agreement for the sale of property, which could not be executed due to various factors. The High Cout opined that both parties were equally at fault for the ultimate non-execution of the agreement. Subsequently, the Trial Court’s order was overturned and the appellant was granted a decree for realization of the sale consideration with interest.
IMPORTANT PROVISIONS:
The Limitation Act, (Limitation Act):
- Article 62
The Transfer of Property Act, (TPA):
- Section 55(6)(b)
OVERVIEW:
- The Plaintiff and the defendant’s predecessors entered into an agreement on 11.11.2013.
- The agreement entailed conveyance of an extent of 25 cents, including a residential building by the defendants to the plaintiff for a consideration of Rs. 62.5 Lakhs.
- A sum of Rs. 12.5 lakhs was paid in advance on the day of the agreement. The balance was supposed to be paid before 11th May 2014.
- The plaintiffs filed a suit for return of the advance consideration alleging a breach of agreement by the defendants.
- The defendants acknowledged the agreement entered into by their predecessor but contested it, stating that the agreement was to gather funds for the medical treatment of their mother.
- The failure of the plaintiff to pay the balance constituted a breach of agreement.
- The predecessor, however, had entered into an agreement with a 3rd party, and an amount of Rs. 13 Lakhs was paid as consideration by them.
- The plaintiff filed a suit against the defendant for return of consideration amount which was dismissed due to the predecessor’s inability to pay the court fee.
- The defendants filed a counterclaim suit for damages worth Rs. 13 Lakhs.
- The trial court dismissed the suit ruling that it was barred by limitation.
- The plaintiff has challenged the trial court’s order in the instant appeal.
ISSUES RAISED:
- Whether relief having been claimed for money charged on immovable property is not Article 62 of the Limitation Act applicable?
- Whether the plaintiff is entitled for charged decree in terms of section 55(6)(b) of the Transfer of property Act?
ARGUMENTS ADVANCED BY THE APPELLANT/PLAINTIFF:
- The respondants had breached the agreement by failing to fulfill their end of the agreement.
- The appellant is entitled to a refund of the advance consideration amount paid by him in light of the same.
- Reliance was placed on the case of Kannan Menon v. Kuttikrishna Menon and Ors to claim the refund.
ARGUMENTS ADVANCED BY THE RESPONDENT/DEFENDANT:
- The purpose of the sale was to arrange funds for the treatment of their mother (predecessor).
- The appellant had breached the agreement by failing to pay the balance of the agreed consideration.
- Concurring with the Trial Court’s judgment, respondent stated that the appellant’s suit was barred by limitation.
JUDGEMENT ANALYSIS:
- The High Court stated that the relief sought by the appellant falls under section 54 of the Limitation Act, but the provision stipulates a limitation period of 3 years from the date of accrual of the cause of action, the claim is barred by limitation.
- Moving to the 2nd issue, the Court opined that as the appellant’s claim involving a decree charged on the plaint schedule property, is provided under section 55(6)(b) of TPA.
- Reliance was placed on the Supreme Court judgment in the case Videocon Properties Ltd. v. Dr. Balachandra Laboratories & Ors wherein the principle underlying Section 55(6)(b) of TPA was discussed.
- As per Article 62 of the Limitation Act, the appellant is entitled to a limitation period of 12 years to file a suit.
- Therefore, the suit is well within the period of limitation.
- The Court interpreted the term “accept delivery” within the section, under which the appellant is entitled to the charge over property.
- The distinction between proper and improper declining to accept delivery.
- In cases where there is no improper declining by the buyer, they are entitled to a charge over the property for purchase of the paid price, regardless of the reasons for the failure of the agreement.
- It was held that the respondents had provided no evidence to show that the appellant had failed to fulfill his agreement due to insufficiency of funds. Therefore, both the appellants and the respondents, including their predecessor, had contributed to the non-performance of the agreement.
- In light of the above findings, the Court granted the appellant the decree.
- As far as the issue of grant of interest goes, the Court noted the delay in filing the suit and held that the interest would be declined until the end of the suit.
- However, the appellant would be granted 6% interest per annum from the date of suit till the date of realization.
CONCLUSION
The High Court allowed the appeal and set aside the judgment of the Trial Court. It granted the plaintiff a decree of Rs. 12.5 Lakhs as realization with 6% interest per annum charged on the plaint schedule property. No order was given as to costs. The Court emphasized on the significance of fairness and equity in awarding the plaintiff a charge over the property, considering shared responsibility.
