IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 24TH DAY OF JULY 2019 BEFORE THE HON’BLE Dr. JUSTICE H.B.PRABHAKARA SASTRY R.F.A.No.1662 OF 2006 C/W R.F.A.No.984 OF 2006 IN R.F.A.No.1662 OF 2006 BETWEEN:
K. Venkataramana Rao S/o. Ramakrishnaiah @ Venkatakrishnaiah, Aged about 48 years, R/o. Kamalashile Village, Kundapur Taluk, Udupi District-576 101. .. Appellant (By Sri Ramesh P. Kulkarni, Advocate ) AND:
1. H. Halappa Gowda, S/o. Veerappa Gowda, Aged about 48 years, Occ: Agriculturist, R/o. Jabagodu, Dumma village, Hosanagara Taluk-577 418.
2. K.P.Madhyastha S/o. Srinivas Madhyatha, Aged about 47 years, Carpenter, R/o. Koteshwar, Kundapur Taluk, Udupi District-576 101. ... Respondents (By.Smt. Vijaya M.N.Adv. for Sri. Rajendra S Ankolkoti Adv for R1, Sri. Narayan Mayyar, Adv For Sri. S.R.Hegde Hudlamane, Adv for R2) IN R.F.A.No.984 OF 2006 BETWEEN:
K.P.Madhyastha S/o. Srinivas Madhyatha, Aged about 47 years, Carpenter, R/o. Koteshwar, Kundapur Taluk, Udupi District-576 101. .. Appellant (By Sri Narayan Mayyar, Advocate for Sri S.R. Hegde Hudlamane, Advocate) AND:
1. H. Halappa Gowda, S/o. Veerappa Gowda, Aged about 48 years, Occ: Agriculturist, R/o. Jabagodu village, Hosanagara Shimoga District -577 201.
2. K. Venkataraman Rao S/o. Ramakrishna @ Venkatakrishna, Aged about 48 years, R/o. Kamalashile Village, Kundapur Taluk, Udupi District-576 101. .. Respondents (By Smt. Vijaya M.N., Advocate for Sri Rajendra S. Ankalkoti, Advocate for R-1 Sri H.H. Kaladgi, Advocate for R-2) These Regular First Appeals are filed under Section 96 of CPC against the judgment and decree dated 21.02.2006, passed in O.S.No.44/1996, on the file of the Civil Judge (Sr.Dn.), Sagar, partly decreeing the suit for recovery of money.
These Regular First Appeals having been heard and reserved for judgment on 03.07.2019, coming on for pronouncement this day, the Court delivered the following:
COMMON JUDGMENT Both these appeals have arisen from the judgment and decree dated 21.02.2006, passed by the learned Civil Judge (Sr.Dn.) Sagar (hereinafter for brevity referred to as ‘trial Court’), in O.S.No.44/1996, wherein the trial Court decreed the suit of the plaintiff, who is the 1st respondent in both these appeals. The trial Court has held that the plaintiff is entitled for a sum of `1,31,995/-, with interest at the rate of 10% per annum from the date of suit till the date of realisation from the present appellants in RFA No.1662/2006 and RFA.No.984/2006 respectively who were the defendants in the trial Court.
2. The summary of the case of the plaintiff in the trial Court is that on 5.11.1992, the plaintiff had agreed to purchase a motor vehicle, which is a Mahindra Jeep bearing Reg.No.AEV-7849 from the defendant No.1 (appellant in RFA No.1662/2006) for a consideration of `1,56,995/- which seller in turn had purchased the said vehicle from the 2nd defendant ( the appellant in RFA No.984/2006). On the same day, the plaintiff had paid a sum of `46,995/- to the 1st defendant and the plaintiff was given delivery of the possession of the said vehicle. Thereafter, the plaintiff paid a sum of `14,000/- to the 1st defendant on 28.01.1993. Again on 14.07.1993 at the instruction of the 1st defendant, the plaintiff purchased Demand Draft in favour of B.D. Credit Corporation Finance, No.4, Madras, and sent to the addressee. The remaining sum of `50,000/-was paid in cash by the plaintiff on 14.07.1993. Thus, the entire consideration of money for the sale of the said Jeep stood passed from the plaintiff to the 1st defendant and agreement of sale also reduced into writing on 14.07.1993 incorporating all the terms of oral agreement and also payment made in respect of the sale of vehicle. It was agreed that 1st defendant had to obtain Hire Purchase Clearance Certificate from B.D. Credit Corporation Finance, Madras and `No Objection Certificate’ from jurisdictional Regional Transport Authority. The 1st defendant failed to furnish the Registration Certificate and No Objection Certificate from the Regional Transport Authority. However, he requested the plaintiff to come to Udupi on 17.11.1993 stating that he would arrange for transfer of the vehicle. Accordingly, the plaintiff went to Udupi on 17.11.1993 taking the vehicle with him. When the vehicle was taken to Udupi, it was seized by the Udupi police on the ground that the vehicle related registration certificate is not the certificate of the vehicle bearing registration No.AEV-7849, Mahindra Jeep, and that the registration certificate pertains to a TVS Moped registered at Vishakhapattana in Andra Pradesh. The vehicle was seized on the complaint made by the RTO. The vehicle was produced before the jurisdictional Magistrate, Udupi in Cr.No.136/1993. Since, the plaintiff did not possess any document of the vehicle, he did not approach the Court for the release of the vehicle. On the other hand, he asked the 1st defendant to arrange for refund of the money paid by him towards sale consideration of the vehicle. The 1st defendant by approaching the Magistrate Court at Udupi, got the said vehicle released in his favour since he was in possession and control of the said vehicle.
It is further the case of the plaintiff that on 18.11.1993 both defendant Nos.1 and 2 approached him in Hosanagar, representing him that the vehicle was belonging to the 2nd defendant before its sale in favour of 1st defendant and since the vehicle was seized, the repayment of the amount to be made, if any, would be made by the 2nd defendant. With such a representation, both the defendants persuaded the plaintiff to accept a sum of `25,000/- from 1st defendant and also two cheques that is Cheque bearing No.44337, for a sum of `1,15,000/- and another cheque bearing No.443372 for `15,000/-, both drawn on Karnataka Bank issued by the 2nd defendant. The plaintiff was also requested not to take any action for recovery of money in respect of transaction and that they would see that the commitment made by the defendants is honoured with such an understanding, a tripartite oral agreement was arrived at Hosanagar.
It is also the further case of the plaintiff that he presented those two cheques given to him by the 2nd defendant for their realisation with his banker. However, both of them returned for want of funds. The plaintiff initiated proceedings under Section 138 of Negotiable Instruments Act, 1881, (hereinafter for brevity referred to as `N.I. Act’) in C.C.No.594/1994 and C.C.No.595/1994, before the learned JMFC & Munsiff, Hosanagar, against the 2nd defendant. Since, the defendants misrepresented and failed to repay the consideration amount paid by him for the purchase of Jeep, the plaintiff was constrained to institute a suit for recovery of the balance amount of `1,15,000/- with interest at 18% there on, which is a sum of `46,995/-, thus in total `1,56,995/- from both the defendants jointly and severally.
3. In response to the service of the summons, the defendants appeared through their counsels and filed their separate written statements. The 1st defendant in his written statement denied the plaint averments that he entered into an agreement to sell the Mahindra Jeep vehicle to the plaintiff and received any amount as consideration. He expressed his ignorance that plaintiff sent Demand Draft to B.D.Credit Corporation Finance, Madras, and contended that the alleged sale deed dated 14.07.1993 is a forged and fraudulent document. He denied that he has executed said document. However, he admitted that the vehicle was seized by the police. He further denied that he approached the plaintiff at Hosanagar on 18.11.1993 and paid him a sum of `25,000/- and two cheques were given by the 2nd defendant. He specifically stated that he has never entered into a tripartite agreement as alleged in the plaint. However, he again stated that defendant No.2 delivered two cheques to the plaintiff. He also admitted that the plaintiff had initiated criminal action against the defendants after dishonour of two cheques issued by the said defendants.
On the other hand, the 1st defendant contended that the 2nd defendant represented to be absolute owner of the vehicle had sold the same to him for a consideration of `1,25,000/-. The 2nd defendant himself had arranged for a loan of `65,000/- from B.D. Credit Corporation, Madras. After purchasing the vehicle, the 1st defendant came to know that title of the 2nd defendant was shrouded with mystery. Thereafter he repudiated the sale transaction and returned the vehicle to the 2nd defendant. The 2nd defendant promised to discharge the loan granted by the B.D.Credit Corporation and to return the money paid by 1st defendant within a short time. Thereafter the 2nd defendant sold the said vehicle to the plaintiff and obtained money from him. As such, the 1st defendant has nothing to do with the said sale transaction. He also contended that there is no privity of contract between him and the plaintiff. The 1st defendant also contended that after vehicle was seized by the police, the 2nd defendant arranged for its release in the name of the 1st defendant as the R.C.book was still continued in the name of 1st defendant. After the vehicle was released, 1st defendant retained the possession of the vehicle as the amounts returnable to him is still due and R.C. was still standing in his name. As such, in order to avoid any such risks or dangers, he retained the possession of the said vehicle until his claims are settled and the R.C. is changed. He further states that suit was wholly misconceived and prays for dismissal of the suit.
4. The 2nd defendant in his written statement apart from contending that the suit was barred by limitation, has stated that he had never claimed ownership over the jeep in question. He is not aware of the seizure of the jeep by the Udupi police and its subsequent release. He further stated that the alleged sale transaction of the said jeep was between the plaintiff and the 1st defendant.
He denied all the averments made in the plaint which were against him. He denied that he had given `25,000/- to the plaintiff as part of refund of the sale consideration, though he has admitted that he has given two cheques to the plaintiff, however, he contended that he had not mentioned the amount in those two cheques and they were not given with respect to alleged transaction of Jeep vehicle, but, given in connection with the timber transaction which he had with the plaintiff. He denied that there was any tripartite agreement. He admitted that the plaintiff had initiated criminal proceedings under Section 138 of N.I. Act against him. He denied that he had ever agreed to pay money to the plaintiff on behalf of 1st defendant whom he never knew earlier. He also denied that he had sold the said Jeep to the 1st defendant for a value of `1,25,000/- and also arranged for a loan of `65,000/- in favour of 1st defendant. Denying all other averments made in the plaint, the 2nd defendant prayed for dismissal of the suit filed against him.
5. Based on the pleadings of the parties, the trial Court framed the following issues :
1) Whether the plaintiff proves that, the first defendant was entered into an oral agreement for sale of the Jeep bearing Reg.No. AEV-7849 for a sum of `1,56,995/- and put the plaintiff in possession of the said vehicle?
2) Whether the plaintiff proves that the first defendant was received a sum of `46,995/- on 05.11.1992 and a sum of `14,000/- on 28.01.1993, a sum of `50,000/- on 14.07.1993 and executed an agreement of sale in his favour?
3) Whether the plaintiff is entitled the interest at the rate of 18% per annum from 18.11.1993 to 15.07.1996?
4) Whether suit is bad for mis-joinder of parties and cause of action?
5) Whether the suit is barred by limitation?
6) Is plaintiff entitled the relief sought for?
7) To what decree or order?
Additional Issue:
Whether the 2nd defendant proves that he has issued two blank cheques signed by him in favour of the plaintiff in connection with some timber transaction with him and the plaintiff has mis-utilised those cheques without his knowledge?
6. In his support, the plaintiff got himself examined as PW-1 and got examined two witnesses namely, one Sri.Kalyanappa as PW-2 and one Sri. Shekharappa as PW-3 and got marked the documents from Exs.P-1 to P-31. The defendant Nos.1 and 2 got themselves examined as DWs-1 and 2 respectively and also got marked documents from Exs.D-1 to D-6.
7. After hearing both side, the trial Court by its impugned judgment and decree dated 21.02.2006, partly decreed the suit of the plaintiff, holding both the defendants jointly and severally liable to pay `1,31,995/- together with interest at the rate of 10% per annum from the date of suit till realisation from the defendants. It is against the said judgment and decree, both the defendants have preferred these two appeals.
8. The lower Court records were called for and the same are placed before this Court.
9. After hearing the arguments from both side and perusing the materials on record, the points that arise for my consideration are:
1. Whether the finding of the trial Court holding that plaintiff has proved that the 1st defendant had agreed to sell the Jeep bearing Reg.No. AEV-7849 to the plaintiff for a sum of `1,56,995/- and received entire consideration in installments is an erroneous finding?
2. Whether the finding of the trial Court that defendant No.2 had also joined the 1st defendant and had issued two cheques in favour of plaintiff towards repayment of sale consideration of the Jeep is erroneous?
3. Whether the judgment and decree passed by the trial Court deserves interference at the hands of this Court?
10. The plaintiff in his evidence as PW1 has reiterated the contents of his plaint in his Examination–in-chief also. He has stated that on 05.11.1992, he had purchased Mahindra Jeep bearing Registration No.AEV-7849 for a sum of `1,56,995/- from the 1st defendant. He had given `46,995/- as advance amount to the said defendant and on the same day the possession of the Jeep was delivered to him. On 28.01.1993, he had paid another sum of `14,000/-. On 14.07.1993, after he gave the entire sale consideration to the 1st defendant, he executed an agreement in his favour. The witness has got marked counter-foil of bank challan to show that he had purchased Demand Draft for a sum of `46,000/- at Ex.P-1 and a Sale Agreement dated 14.07.1993 at Ex.P-2 and has identified the alleged signature of 1st defendant in Ex.P2 at Ex.P2(a) and Ex.P2(b) and has also stated that Kalyannappa Gowda and Shekarappa were also present at the time of agreement and they have subscribed their signatures as witnesses to the said document. He has identified their signatures at Ex.P2(c) and Ex.P2(d) and the signature of the scribe Sridhara Udupa at Ex.P2(e).
The witness has further stated that since the vehicle was under hypothecation, the transfer of its ownership could not be done immediately. As such, the responsibility of clearing the loan was left upon the 1st defendant. The said defendant had also executed Form Nos.29 and 30 at Exs.P-10 and P-11.
The witness has further stated that he was repeatedly requesting the 1st defendant to transfer RC Book entry in his favour. However, it was getting delayed. On 17.11.1993 along with 2nd defendant, he went to RTO at Udupi where the police came and seized the jeep stating that the said vehicle does not bear the valid documentation. Since, there was no proper documentation of the said vehicle, he did not attempt to go to the Court, however, defendant No.1 got released the vehicle from the Court.
The witness has further stated that on 18.11.1993 the defendants after coming to Hosanagar agreed to return the amount of `1,50,000/- to him out of which 1st defendant paid `25,000/- in cash and with respect to the remaining sum of `1,25,000/-, 2nd defendant gave two cheques. When presented for realisation, both the cheques were dishonoured for insufficiency of funds in which connection, he lodged two criminal cases of cheque bouncing against 2nd defendant which were pending as on the date of his evidence in the Court. The witness has stated that 1st defendant had given him an impression that he is the owner of the vehicle.
The witness in his further examination-in-chief has stated that the RTO of Udupi had lodged a complaint before the Udupi Police for improper documents in respect of the subject matter of Jeep, a copy of the complaint is marked at Ex.P-3. For getting the vehicle released, the 1st defendant had executed some documents including Indemnity Bond, copy of the which was marked at Ex.P-4. The Udupi police had registered a criminal case against the 1st defendant. The copies of FIR in connection with the said case and charge sheet were marked at Exs.P-5 and P-6. A copy of the Jeep seizure panchanama drawn by the police was marked at Ex.P-7.
The witness has further stated that, at his insistence for refund of money, the 1st defendant had paid a cash of `25,000/- to him as a part amount and 2nd defendant had given him two cheques, one for `1,15,000/- and another for `10,000/-. Stating that he had documents executed by 1st defendant pertaining to the vehicle and other related documents, the witness has produced and got them marked at Exs.P-1 to P-14 and also stated that defendant has executed two receipts in his favour as per Exs.P15 and P16. He has identified the signature of witness Kalyanappa on those receipts. He has also produced the letter of correspondence made by him in this connection at Exs.P-17 to P-22. Further he has also stated that though the 2nd defendant has stated that he has written a letter as per Ex.P7 and P23, but, said letter did not have cheque as a enclosure.
PW1 was subjected to a detailed cross-examination from both the defendants, wherein he adhered to his original version. He has given many more details about the alleged negotiation said to have been taken place in connection with the sale of jeep in his favour and details as to where negotiation took place and who were present at the time of negotiation.
11. When Kalyanappa was examined as PW2 on behalf of the plaintiff, he has stated that he knows both the plaintiff and defendants in this matter and he was present when the sale negotiation had taken place in respect of the jeep in question. At that time, PW3 Shekarappa was also present. The witness has stated that it was agreed that the said jeep was sold for a sum of `1,56,995/- of which amount the plaintiff paid a sum of `46,995/- as advance amount and took possession of the Jeep. The witness has identified the agreement entered into between the parties in Ex.P2 and signature therein at Ex.P2(b) and also receipt said to have been executed by the 1st defendant at Ex.P15 and his signature as witness therein at Ex.P15(b).
The witness has further stated that after two and half months thereafter, the 1st defendant collected some more advance amount of `14,000/- from the plaintiff in his presence, in which regard, one more receipt as per Ex.P16 was executed by 1st defendant in favour of the plaintiff. The witness has identified his signature as per Ex.P16 (b) also. The witness has also stated that in the second week of July, 1993 a Sale Agreement written in his presence in the house of Sridhara Udupa.
At that time the plaintiff had drawn demand draft in favour of B.D.Credit Corporation Finance, Madras for a sum of `46,000/- and cash of `50,000/- was paid to 1st defendant and 1st defendant gave duly signed Form Nos.29 and 30 to the plaintiff and undertook to get loan clearance certificate, No Objection Certificate and deliver it to the plaintiff. The witness has stated that he has put his signature as witness to the sale agreement, which he has identified at Ex.P2(C).
The witness has further stated that four months after the Sale Agreement when the plaintiff had taken Jeep to the RTO office at Udupi, the police seized the said Jeep stating that the documents of vehicle were tampered. At that time, even defendant Nos.1 and 2 were present. On the next day, both the defendants approached the plaintiff at Hosanagar and promised him to refund the sale amount of `1,50,000/- to the plaintiff.
However, immediately 1st defendant paid a cash of `25,000/- to the plaintiff as a part of the refund of the money to the plaintiff. This witness was subjected to detailed cross examination, wherein he adhered to his original version.
12. The plaintiff also got examined one Shekarappa as PW3 who also deposed on the lines similar to that of PW2. He also has stated that he too was present when sale transaction, agreement of sale and negotiation for refund of the money took place. He identified the signatures in all those documents, including Sale Agreement as per Ex.2. He stated that he was also present when 1st defendant refunded `25,000/- as a portion of agreed refundable amount and the 1st defendant gave two cheques for the balance amount.
This witness was also subjected to a detailed cross examination wherein he adhered to his original version.
13. On behalf of the defendants, 1st defendant got examined as DW1. In his examination-in-chief filed in the form of affidavit, he has reiterated the contention taken up by him in his written statement. Apart from denying that he had entered into an agreement of sale of his vehicle with the plaintiff, he has denied that there was any oral tripartite agreement between the plaintiff and the defendants. However, he has admitted that 2nd defendant had given two cheques to the plaintiff but stated that those two cheques were given in connection with the jeep transaction. He has also stated that he has not given any blank forms duly signed by him to the plaintiff.
He further stated that though he had purchased the subject matter jeep from 2nd defendant for a sum of `1,25,000/-, in which, a sum of `65,000/- was paid to the seller, after availing loan from B.D. Credit Corporation Finance, Madras, but, subsequently, he came to know that the vehicle was not carrying a good title. As such, he returned the jeep to the 2nd defendant and requested for refund of money. It is thereafter the 2nd defendant had sold the said Jeep to the plaintiff and collected money from him.
He further stated that after seizure of the jeep since the entries in the RC Book was standing in his name he got the said vehicle released and kept it with himself to enable him to produce the same as and when demanded. He got marked documents at Ex.D1 to D6.
14. The 2nd defendant who got examined himself as DW2 also in his examination-in-chief filed in the form of affidavit has reiterated the contentions taken up by him in his written statement. Though he has admitted issuance of two cheques to the plaintiff, but, stated that those two cheques were issued in connection with timber transaction which he had with the plaintiff. However, thereafter due to some difference of opinion that has arisen between them, the plaintiff has misused the said cheques given by the 1st defendant. He also stated that no transaction with respect to the sale of jeep was ever made by him with the plaintiff.
He was also subjected to detailed cross examination from the plaintiff’s side as well 1st defendant side, wherein he adhered to his original version.
15. In the light of the above, it was the argument of learned counsel for the appellant in RFA No.1662/2006 that the plaintiff has failed to prove that there was any transaction with respect to the sale. Ex.P2 was not signed by the 1st defendant. He also stated that the evidence of PWs-2 and 3 with respect to the said agreement is not believable. Learned counsel further submitted that when the 1st defendant had disputed his signature at Ex.P2, the trial Court was not justified in comparing the disputed signature of the 1st defendant with his admitted signatures by itself and without sending the documents for expert’s opinion.
16. In his support, he relied upon the judgment of Hon’ble Apex Court in the case of Ajay Kumar Parmar Vs State of Rajastan reported in 2012 AIR SCW 5492 and a judgment of Co-ordinate Bench of this Court in the case of B Nagarajappa Vs. Boramma reported in LAWS (KAR) 2010 4 41, these Judgments will be referred at the appropriate stage hereafterwards. The learned counsel further submitted that by virtue of 2nd defendant giving two cheques to the plaintiff, undertaking to refund the sale consideration of the jeep, the alleged first contract at Ex.P2 stands substituted with subsequent contract, as such, there is novation which discharges 1st defendant from his alleged liability towards plaintiff.
17. Learned counsel for the appellant in RFA No.984/2006 in his argument submitted that the suit is barred by limitation. He also submitted that the 1st defendant in his written statement has stated that he had no knowledge of loan taken from B.D.Credit Corporation Finance, Madras. On the contrary, the same defendant as DW1 in his examination in chief has stated that 2nd defendant had promised to clear the said loan.
Thus, there is inconsistency in the case of 1st defendant. Learned counsel further submitted that admittedly RC book was not standing in the name of 2nd defendant as on the date of Sale Agreement at Ex.P2. Therefore, the question of either 2nd defendant agreeing to sell vehicle to the plaintiff or issuing two cheques for the refund of the alleged sale value of the jeep won’t arise. He further submitted that even though issuance of two cheques by the 2nd defendant to the plaintiff is not in dispute, however, those cheques were not issued as Indemnity to the 1st defendant in respect of transaction, but, it was given to the plaintiff in a timber business which has been established in the evidence led by the parties. He further submitted that merely because 2nd defendant was known to the plaintiff and the 1st defendant, the 2nd defendant has been falsely implicated by misusing the cheques issued by him to the plaintiff.
18. Learned counsel for the plaintiff in her argument submitted that from the date of oral agreement to sell the jeep till the delivery date admittedly he is in possession of the jeep. It is further admitted by the 1st defendant in his written statement itself that it was himself who got the said jeep released when it was seized by the police. Therefore it cannot be believed that he had not sold the jeep to the plaintiff but it was 2nd defendant.
Learned counsel further submitted that admittedly issuance of cheques in question was by the 2nd defendant and it is also established that defendants No.1 and 2 and plaintiff had tripartite agreement wherein 2nd defendant as indemnifier, issued cheque on behalf of 1st defendant. As such, both defendants No.1 and 2 were jointly and severally liable to the plaintiff and recognising the same, the trial Court has decreed the suit as against both the defendants.
19. PW1 apart from stating that 1st defendant was the person who agreed to sell the jeep in question to him for a consideration of `1,50,000/- has given more details about the acquaintance with the 1st defendant in his cross-examination. He has stated that prior to 05.11.1992, 1st defendant was not a known person to him and it was only on that day for the first time, he was introduced to him through one Sri. Venkatesh, a driver of office at Taluk Panchayath and it was he who had taken him to 1st defendant. The said statement has not been specifically denied from the 1st defendant side.
20. Secondly, it is not in dispute that even before 1st defendant came in contact with the plaintiff, defendants No.1 and 2 were known to each other. As such 1st defendant claims to have purchased the said jeep from 2nd defendant. Said 2nd defendant both in his written statement, as well in his evidence, has not denied the transaction with respect to the purchase of jeep by the plaintiff from the 1st defendant. Therefore, the contention of the 1st defendant that the plaintiff was stranger to him is not acceptable.
21. The contention of the plaintiff that, on 05.11.1992 he agreed to purchase jeep bearing registration No. AEV-7849 from the 1st defendant and in that regard, on the very same day, he had paid an advance amount of `46,995/- to the 1st defendant and another sum of `14,000/-paid to him on 28.01.1993 and that he also cleared the loan taken for said vehicle from B.D. Credit Corporation Finance, Madras are all corroborated by the evidence of PWs-2 and 3. Both the witnesses have uniformly stated that both of them were present when the sale transaction was discussed and agreed in the house of 1st defendant in the month of November 1992. In that regard both the witnesses were subjected to detailed cross-examination from the defendants’ side. However, they adhered to their original version even in their cross-examination also.
22. On the other hand, they have given more details as to how and when the negotiation took place and when transaction had taken place. Both of them have given details as to at what time they left the respective places, how the negotiation took place, what was the price demanded by the 1st defendant for the sale of jeep and ultimately, what amount was agreed to be paid by the plaintiff. These details are uniformly stated by both the witnesses. Further, both these witnesses have also stated as to how much advance amount was paid in cash on the very same day from the plaintiff to the 1st defendant and how the remaining amounts were paid. All the details given by them tallies with what PW1 in his evidence has stated.
Further, the plaintiff both in his pleadings, as well in his evidence as PW1, has stated about the presence of PWs-2 and 3 at the relevant point of time, when the transaction with respect to sale of Jeep and payment of money were said to have been taken place. Therefore, merely because PW3 stated that it is shown that has has not gone to Kamalashile which is the place of residence of 1st defendant, by that itself the entire evidence of PW3 cannot be treated as unbelievable. Both PW2 and PW3 in their evidence have clearly stated that 1st defendant executed the agreement at Ex.P2 in favour of plaintiff when the entire sale consideration was paid on 14.07.1993. They have identified the said document as well as their signatures in it, as such, the evidence of PW2 and PW3 fully corroborates the case of the plaintiff and gives no scope to disbelieve the same.
23. The 1st defendant has specifically denied that he had executed the sale agreement as per Ex.P2. The said document gives the detailed account of agreement for sale of suit subject jeep by 1st defendant to the plaintiff for a total consideration of `1,56,995/-. It also gives the details as to in how many installments and of what amount, the said sale amount was paid by the plaintiff to the 1st defendant. Those details tallies with what PW2 and PW3 have stated in their evidence.
24. The plaintiff has, apart from identifying and marking the said document at Ex.P2, has also identified and marked the signature of 1st defendant therein at Exs.P-2(a) and P2(b). However, the defendant has denied those signature as of his. The trial Court after comparing those signatures by itself, with the admitted signature of the 1st defendant on written statement, vakalath and signatures at Ex.Ps-15, 16, as well the specimen signature at Ex.P8(a) and Ex.P14a() has come to the conclusion that, as could be seen even with bare eyes, those signatures appear to be similar and the style and stroke of the signatures are also similar. In that regard it even considered Form No.29 and 30 marked as exhibits where the signature of the 1st defendant was shown to have been obtained.
25. Learned counsel for the 1st defendant in his argument seriously objected for the learned Judge of the trial Court comparing the signature by itself. He submitted that the learned trial Judge ought not to have done that exercise by himself. In that regard, he relied upon two judgments in his support. In the case of Ajay Kumar Parmar (Supra), Hon’ble Apex Court at paragraph 23 was pleased to observe as below:
The opinion of a handwriting expert is fallible/liable to error like that of any other witness, and yet, it cannot be brushed aside as useless. There is no legal bar to prevent the Court from comparing signatures or handwriting by using its own eyes to compare the disputed writing with the admitted writing and then from applying its own observation to prove the said handwritings to be the same or different, as the case may be, but in doing so, the Court cannot itself become an expert in this regard and must refrain from playing the role of an expert, for the simple reason that the opinion of the Court may also not be conclusive. Therefore, when the Court takes such a task upon itself, and findings are recorded solely on the basis of comparison of signatures or handwritings, the Court must keep in mind the risk involved, as the opinion formed by the Court may not be conclusive and is susceptible to error, especially when the exercise is conducted by one, not conversant with the subject. The Court, therefore, as a matter of prudence and caution should hesitate or be slow to base its findings solely upon the comparison made by it. However, where there is an opinion whether of an expert, or of any witness, the Court may then apply its own observation by comparing the signatures, or handwritings for providing a decisive weight or influence to its decision.
Relying upon the judgment of Boramma’s case (supra), the Apex Court, in the case of State (Delhi Administration VS. Paliram) AIR 1979 SC 14 and considering the fact that in the Second Appeal before it, wherein the trial Court had held that signature do tally, but, the First Appellate Court recorded that signatures do not tally, was proceeded to hold that the act of the First Appellate Court in remanding the matter to the trial Court was justified.
26. Section 73 of the Indian Evidence Act, 1872, empowers the Court to compare the disputed signature and handwriting with the admitted ones.
No doubt, as observed by the Hon’ble Apex Court in Ajay Kumar Parmar’s case (Supra), the Cout as a matter of prudence and caution should hesitate or to base its findings solely upon the comparison made by it, however, in the case on hand the trial Court has not based its findings solely upon the comparison made by it. As observed above, apart from the trial Court comparing the admitted signatures of 1st defendant, to that of disputed signatures at Ex.P2 and P2(b) has also considered the evidence led by the parties on the execution of Ex.P2 and more particularly, the evidence of PW2 and PW3, who were the witnesses to Ex.P2, under which the 1st defendant is shown to have executed the agreement of sale of the jeep in favour of the plaintiff.
As such, taking stock of the entire facts and circumstances of the case before it and not just confining its comparison of the signatures of defendant, the trial Court has arrived at the finding that 1st defendant has executed the document at Ex.P4. Therefore, when there is no prohibition for Court to compare the signature by itself, however, since the trial Court has taken all the precaution before arriving at a opinion regarding the execution of Ex.P1 and P2 by the 1st defendant by considering all materials before it, including appreciating the evidence of PW2 and PW3, who are the eye witnesses to the execution of the document by 1st defendant, I do not consider the said act of trial Court in comparing the signature of 1st defendant and arriving at a conclusion that the disputed signature tallies and that it is proved by the plaintiff that 1st defendant had executed Ex.P2 in favour of the plaintiff, can be found fault with. As such, the first point of argument of learned counsel for 1st defendant that trial Court has committed an error and that the 1st defendant had neither executed agreement at Ex.P.2 nor received any amount mentioned therein is not acceptable.
27. It is the case of the plaintiff that on 05.11.1992 i.e., on the very day of oral agreement for purchase of the Jeep from 1st defendant, he had paid an advance of a sum of `46,995/-. It is thereafter, a sum of `14,000/- was paid on 28.01.1993 and once again through Demand Draft, vehicle loan standing in his loan at M/s. B.D.Credit Corporation Finance, Madras, was also cleared. The remaining sum of `50,000/- was paid in cash by him to the 1st defendant on 14.07.1993. Thus, the entire consideration of money for sale of jeep has been passed from him to the 1st defendant. The 1st defendant has denied the same both in his written statement as well in his evidence as DW1. However as already observed above, since the execution of document at Ex.P2 which is on 14.07.1993 has stood proved against the 1st defendant and since all these payments made to the 1st defendant has been documented in the said agreement of sale, mere denial by the 1st defendant about the alleged transaction would not establish his defence.
On the other hand, the oral and documentary evidence of plaintiff as PW1 and through Ex.P2 and further corroboration of the plaintiff’s case by PW2 and PW3 who have stated that when the consideration was passed to the 1st defendant by the plaintiff they were also present, would go to establsh that sale consideration towards the purchase of the jeep by the plaintiff has been duly passed to the 1st defendant.
28. Even though, the 1st defendant has contended that the alleged loan from M/s B.D.Credit Corporation Finance, Madras, though was standing in his name, but, it was the 2nd defendant who without his knowledge has raised it, but, he has not denied the said loan stands in his name. The 2nd defendant both in his pleadings, as well in his evidence stated that, it was the 1st defendant who had availed the loan from said B.D. Credit Corporation Finance, Madras. Further the contention of the 1st defendant that the said loan was not availed by him though it stands in his name, does not inspire confidence to believe. One more reason for it is that without the lonee appearing before it in person, a banker or a financier would not generally release the loan in his favour. As such, when necessary application is filed by the applicant/lonee for sanction of loan without being himself present before banker or through his attorney, the banker would not have disbursed the loan. For this reason also the contention that 1st defendant is in no way related to the said transaction is not acceptable.
29. Therefore, it is clear that 1st defendant in his capacity as owner of the jeep and RC owner of the jeep had sold the said jeep to the plaintiff under Ex.P.2 and received consideration towards the same. ExsP.10, P11, P13 and P14,which are the blank executed form for transfer of ownership of vehicle executed by the 1st defendant, also go to show that he had sold the vehicle to the plaintiff.
30. The contention of the 1st defendant is that though he had purchased the said vehicle from 2nd defendant, but, after coming to know that there was defect in the title and documentation of the vehicle, had returned the said vehicle to the 2nd defendant. But the said contention of the defendant has not been established. There is no reason to believe that 1st defendant had delivered back the Jeep to the 2nd defendant. Even 2nd defendant had categorically denied that at any point of time, the 1st defendant delivered the said Jeep to him. The contention of the 1st defendant that he being the R.C. owner got the said vehicle released after its seizure by the police and retained the same for his safety and for its production before the Court as and when summoned is also not acceptable for the reasons that had really he was not happy with the title of the said vehicle, he would have taken immediate steps for removal or cancellation of RC book or transferring the said vehicle back to the name of 2nd defendant.
Admittedly, 1st defendant has not acted in that direction rather he claims that he has only retained the vehicle without taking any appropriate action against the 2nd defendant in that regard. As such, getting the vehicle released after seizure and retaining the said vehicle with himself by 1st defendant cannot be considered as for any safety measure. As such, the very conduct of the 1st defendant also contribute in disbelieving his contention.
31. The second stage in the transaction is the refund of sale consideration said to have been made to the plaintiff by defendant Nos.1 and 2 jointly. According to the plaintiff, both defendant Nos.1 and 2 approached him and defendant No.1 gave cash of `25,000/- as a part amount of refund of the sale consideration and defendant No.2 issued two cheques one for `1,15,000/- and another for a sum of `10,000/- towards repayment of the sale consideration of the Jeep. Both defendant Nos.1 and 2 have denied the same. However, while 1st defendant contended that said `1,15,000/- must have been given by 2nd defendant but the 2nd defendant contended that it was with respect to other transaction.
32. PW1 in his evidence has given the details as to where the said refund of amount was made to him. He has stated that on the next day of seizure of the Jeep i.e., 18th day of the month, it was in an establishment by name Shrusti Consultant at Hosanagar, the negotiation took place and both defendant Nos. 1 and 2 were there among whom the defendant Nos. 1 and 2 entered into an agreement and it was decided that 1st defendant had to refund a sum of `1,50,000/- to the plaintiff. As per the said agreement, 1st defendant paid him a cash of `25,000/- and obtained receipt in that regard. For the remaining amount, 1st defendant got issued two cheques from 2nd defendant to the plaintiff one for a sum of `1,15,000/- another cheque for a sum of `10,000/-. Thus, even according to PW.1, the issuance of two cheques by 2nd defendant was not directly by 2nd defendant in his independent capacity as a seller of the vehicle but it was only at the request and on behalf of the 1st defendant. PW.s 2 and 3 have stated that they were also present when the transaction took place and it was in their presence, 1st defendant gave a sum of `25000 to the plaintiff in cash and got issued two cheques in total for a sum of `1,25,000/-.
33. All these three witnesses were subjected to a detailed and searching cross examination from defendant side in which cross examination they could successfully withstand without any scope for any doubt creeping in their evidence. However, the 2nd defendant both in his pleadings as well as in his evidence has categorically contended that issuance of cheque by him was not towards refund of sale consideration towards Jeep, but it was in connection with timber business which he had with the plaintiff and as a precaution the plaintiff before participating in timber auction used to collect money and in that direction two cheques were given to him in blank however the amount was paid by himself. The plaintiff has denied the same so also 1st defendant.
In that direction, learned counsel for 1st defendant in his argument, while relying upon the document at Ex.D2 to D5, has stated that in the criminal cases filed by the plaintiff in connection with bouncing of cheque issued by the 2nd defendant, the complainant himself has stated that those two cheques were issued in connection with refund of sale consideration of the Jeep in favour of the plaintiff. As such it is established that two cheques were given by the 2nd defendant not towards any timber business, but it is towards refund of sale consideration towards the sale of Jeep.
No doubt in Ex.D2, D3, D4 and D5, it is shown that complainant has taken the contention even before the criminal Court about issuance of those cheques by the 2nd defendant/accused, that the issuance of cheque was towards refund of consideration towards Jeep sale transaction. However, it cannot be forgotten that said contention has not been admitted by 2nd defendant/accused. Ex.D2 to D5 are the documents of the complainant(plaintiff) in the form of complaint and his evidence which is not an admission on the part of 2nd defendant (accused) in the criminal case. On the other hand, 2nd defendant apart from reiterating his contention that was taken in written statement even in his evidence as DW2, also has subjected 1st defendant (DW1) for cross examination on the said point. In the said cross examination 1st defendant has clearly stated that he does not know that the two cheques given by 2nd defendant to the plaintiff were with respect to timber transaction. 1st defendant has not denied that those cheques were given by 2nd defendant to the plaintiff towards timber business. Therefore in the absence of any admission to show that two cheques inquestion which were given by 2nd defendant to the plaintiff was a return of sale consideration with respect to the Jeep and also since even according to the plaintiff , he has established the sale transaction and the contract with respect to the Jeep was only between plaintiff and 1st defendant, mere issuance of two cheques by 2nd defendant to the plaintiff cannot be considered as a part of very same transaction and there was any tripartite agreement between the plaintiff and defendant Nos. 1 and 2 in that regard.
34. Further, even according to the plaintiff, the cheque dishonour, for the offences punishable under Section 138 of Negotiable Instruments Act instituted by him also, did not reach its logical end and came to be dismissed for default of the complainant. Against the same, he has not taken any appropriate steps. As such also, the contention of the plaintiff that 2nd defendant was jointly and severally liable along with the 1st defendant, is not acceptable.
On the other hand, the arguments of learned counsel for 2nd defendant that plaintiff has failed to establish that there was any tripartite agreement between the plaintiff, 1st defendant and 2nd defendant and that 2nd defendant had issued those two cheques in favour of the plaintiff not towards the refund of sale consideration in connection with the Jeep has stood established, and is acceptable. The trial Court without appreciating the evidence on this behalf in a proper perspective has erroneously held that along with 1st defendant, even 2nd defendant is also jointly and severally liable to the plaintiff.
35. The other argument of the learned counsel for the appellant that there was a substitution of agreement in the place of Ex.P2 is concerned, it has to be considered that, even according to the plaintiff they entered into a tripartite agreement and 2nd defendant has issued two cheques in favour of the plaintiff towards repayment of the amount, as such the first agreement dated 14.07.1993 at Ex.P2 stands substituted when the subsequent alleged oral agreement came into existence. However the same was not proved by them. On the contrary, 2nd defendant (appellant in RFA No.984/2006) could able to prove that two cheques issued by him for a sum of `1,15,000 and `10,000/- respectively were not towards repayment of the sale consideration of the Jeep but, the same was towards the timber transaction business.
Thus the question of substitution of non existing contract in the place of Ex.P2 or the novation does not arise. As such arguments of learned counsel for the appellant on the said aspect is not acceptable.
36. Lastly, learned counsel for the 2nd defendant in his argument submitted that the suit filed by the plaintiff was barred by limitation. The said issue was decided in favour of the plaintiff holding that suit was not barred by limitation by the trial court.
According to the 2nd defendant the oral agreement as contended by the plaintiff was on 05.11.1992 whereas the suit is filed on 15.07.1996, therefore it is barred by limitation.
37. In the analysis made above, it is noticed that the plaintiff has proved that there existed an agreement dated 14.07.1993 (Ex.P2) for the sale of suit subject Jeep by defendant No. 1 to the plaintiff, as such, the said date is giving cause of action to the plaintiff to institute the suit. It is further established by the plaintiff that 1st defendant towards refund of Jeep sale consideration to the plaintiff, out of the amount of `1,50,000/-, had paid a sum of `25,000/- in cash on 18.11.1993. The plaintiff stated that 13.07.1996 and 14.07.1996 were holidays, as such, suit was filed on the next day i.e.,15.07.1996. The same is not disputed by the defendants. As such, from the first day of cause of action which has arisen on 14.07.1993 and subsequent days including 18.11.1993 since falls within three years as on the date of filing of the suit, the contention of 2nd defendant that suit was barred by limitation, is not acceptable.
38. Barring the above no other points of arguments worth to be considered were addressed from the defendants. As analysed above. 2nd defendant could able to establish that the two cheques one for `1,15,000/- and another `10,000/- were not given by him to the plaintiff towards the alleged repayment of sale consideration of Jeep. Further the suit is not based on those two cheques issued by 2nd defendant to the plaintiff. More over, the plaintiff could not able to establish that 2nd defendant in any manner has stood as indemnifier for the acts of the 1st defendant against the plaintiff. However, the trial court without appreciating these facts appears to have been carried away by the fact that 2nd defendant had issued two cheques in favour of the plaintiff and concluded that those two cheques were issued as a part of refund sale consideration of the Jeep to the plaintiff. Since the said finding of the court below now has proved to be erroneous finding, the appeal of the 2nd defendant in RFA No.984/2006 deserves to be allowed.
39. The impugned judgment and decree deserves to be set aside and suit of the plaintiff deserves to be dismissed as against 2nd defendant only. However, since the findings of the Court below holding the 1st defendant liable to the plaintiff to pay the decreed amount and awarded interest there upon is a properly reasoned order passed by the Court and appellant in RFA No.1662/2006 could not able to establish that the judgment and decree passed in the said suit suffers with some error in holding him liable to the plaintiff, I am of the view that RFA No.1662/2006 filed by the 1st defendant in the original suit does not deserves to be allowed.
Accordingly, I proceed to pass the following order:
ORDER The Appeal in RFA No.1662/2006 is dismissed.
The appeal in RFA No.984/2006 is allowed.
The judgment and decree dated 21.02.2006, passed by the learned Civil Judge (Sr.Dn.), Sagar in O.S.No.44/1996, is set aside as against 2nd defendant therein. The suit in O.S.No.44/1996 against the 2nd defendant Sri. K.P.Madhyastha is dismissed. However, the said judgment and decree is confirmed as against 1st defendant Sri.K.Venkataramana Rao.
There is no order as to costs.
The Registry is directed to transmit a copy of this judgment along with lower Court records to the lower Court without delay.
In view of the disposal of the main appeals, IAs pending does not survive for consideration.
Sd/- JUDGE JS/-