2014 (11) TMI 1180 - HC - Indian Laws

Sale of undivided share of Land by the Sister unit - dishonor of Cheque for want of sufficient funds - Section 55(4)(b) of the Transfer of Property Act, 1882 - Held that - Initially the defendant misled the District Consumer Forum by false complaint and obtained an order. When the plaintiff filed a civil suit for recovery, the defendant again made a serious attempt before the civil Court by producing Ex. B3/forged receipt to show as if she had paid ₹ 3,19,970/- to the plaintiff. Clear findings have been given by the trial Court that the defendant had marked the forged receipt under Ex. B3 to disprove and defeat the plaintiff s case and claim. When a party approaches the High Court, he/she must place all the facts before the Court without any reservation and if there is a false statement or a twisted fact placed before Court, then the Court should not hesitate to curb such practice by imposing exemplary costs, in the present case, when the defendant made a false story before the District Consumer Forum against the plaintiff that she had paid a huge amount of ₹ 3,19,970/- under Ex. B3 a forged document and attempted to deceive the abovesaid amount, this Court is of the considered view that she should be made to pay the same amount to the plaintiff, accordingly, the defendant is directed to pay a sum of ₹ 3,19,970/- under Ex. B3 to the plaintiff within a period of four weeks from the date of receipt of a copy of this order. Appeal allowed.

Summary

Issues Involved:
1. Misreading and misinterpretation of documents and evidence by the Lower Appellate Court.
2. Non-appreciation of evidence and documents by the Lower Appellate Court.
3. Payment of sale consideration and cost of construction.
4. Applicability of Section 55(4)(b) of the Transfer of Property Act.
5. Entitlement to interest over the alleged balance of sale consideration and construction cost.
6. Validity of the receipt for Rs. 3,19,970/-.

Detailed Analysis:

1. Misreading and Misinterpretation of Documents and Evidence by the Lower Appellate Court:
The plaintiff argued that the Lower Appellate Court misread and misinterpreted the documents and evidence, specifically the unpaid cheque (Ex. A3) for Rs. 75,860/-. The court noted that the cheque was dishonored, and the defendant did not pay the amount. The plaintiff also claimed that the defendant paid only Rs. 5,75,000/- towards the construction cost, leaving a balance of Rs. 1,94,140/-. The Lower Appellate Court's adverse inference against the plaintiff regarding the dishonored cheque was deemed unwarranted.

2. Non-appreciation of Evidence and Documents by the Lower Appellate Court:
The plaintiff contended that the Lower Appellate Court failed to appreciate the evidence and documents, including the construction agreement and sale deed. The trial court had found that the defendant did not pay Rs. 3,19,970/- as claimed. The plaintiff produced relevant bank account statements to show that such payment was not made. The Lower Appellate Court's conclusion that the plaintiff failed to prove the non-payment was found to be incorrect.

3. Payment of Sale Consideration and Cost of Construction:
The plaintiff argued that the defendant did not pay the full sale consideration and construction cost. The trial court found that the defendant paid Rs. 5,75,000/- and was liable to pay the balance amount. The defendant's claim of paying Rs. 3,19,970/- through Ex. B3 was found to be unsubstantiated. The trial court held that the defendant's contradictory statements regarding the payment method (cheques vs. cash) made her claim unreliable.

4. Applicability of Section 55(4)(b) of the Transfer of Property Act:
The plaintiff claimed a charge over the property under Section 55(4)(b) of the Transfer of Property Act due to unpaid sale consideration. The trial court upheld this claim, granting the plaintiff a charge over the suit flat. The Lower Appellate Court's failure to appreciate this aspect was criticized.

5. Entitlement to Interest Over the Alleged Balance of Sale Consideration and Construction Cost:
The plaintiff was entitled to interest at 25% per annum on the unpaid amount as per the construction agreement. The trial court awarded interest from the date of the suit till realization. The Lower Appellate Court's decision to deny interest was found to be incorrect.

6. Validity of the Receipt for Rs. 3,19,970/-:
The trial court found the receipt (Ex. B3) for Rs. 3,19,970/- to be forged. The defendant's contradictory statements and lack of evidence to support the payment claim led to this conclusion. The Lower Appellate Court's acceptance of Ex. B3 without proper scrutiny was criticized.

Conclusion:
The High Court concluded that the Lower Appellate Court misread and misinterpreted the evidence, failed to appreciate the documents, and wrongly denied the plaintiff's claims. The trial court's judgment and decree were restored, awarding the plaintiff Rs. 3,76,990/- with interest and a charge over the suit flat. The defendant was directed to pay Rs. 3,19,970/- as exemplary costs for misleading the court.