IN THE HIGH COURT OF KERALA AT ERNAKULAM
AS No. 809 of 1997(E)
1. MUSLIARAKATH ABDULLA
... Petitioner
Vs
1. K.ABDUL AZEEZ NAHA
... Respondent
For Petitioner :SRI.M.A.MANHU
For Respondent :SRI.T.KRISHNAN UNNI
The Hon'ble MR. Justice R.BHASKARAN
The Hon'ble MR. Justice K.T.SANKARAN
Dated :03/03/2006
O R D E R
R.Bhaskaran & K.T.Sankaran, JJ
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.A.S.Nos.809 of 1997 & 845 of 1998
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Judgment
Bhaskaran, J.
A.S.No.809 of 1997
This appeal is filed by by the defendant in O.S.No.27 of 1994 on the file of
the Subordinate Judge’s Court, Tirur. The suit was filed for realisation of
Rs.4,25,622.55 with interest at 15% per annum. According to the plaintiff, the
defendant was the driver of the plaintiff. He got employment at Jiddah. His
services were terminated in 1986. While returning to India, he had purchased a
foreign car for the plaintiff. 10,000 Riyals was paid by the plaintiff through his
son-in-law, who was working there. After the car was brought to India, the
delivery was delayed on account of customs clearance problems. The plaintiffs
spent an amount of Rs.13,000/- for demurrage charges. Rs.1,82,227.55 was paid
as customs duty. Various other amounts had also to be incurred for getting
clearance of the car including warehouse charges, battery service charges,
charges for registration number etc. The plaintiff spent a total amount of
Rs.3,18,223.55 for the car. The defendant intimated the plaintiff that he had paid
530 Riyals at the time of purchase of the vehicle. The balance amount due to the
defendant was also paid by the plaintiff. In the meanwhile, a complaint was
received in the Regional Transport Office. According to the plaintiff, it was
A.S.Nos.809/97 & 845/98 2
manipulated by the defendant to take the vehicle from the custody of the plaintiff.
On the request of the defendant, it was given to him for producing before the
R.T.A. The defendant also agreed to transfer the vehicle in the name of the
plaintiff after the ‘no sale’ period was over failing which he undertook to pay the
plaintiff the amount of damages. The defendant however applied for duplicate
R.C.Book. Knowing about it, the plaintiff filed objections. The defendant did not
return the vehicle to the plaintiff and he transferred the vehicle in the name of
another person within the ‘no sale’ period. Hence the suit was filed for realisation
of Rs.4,25,662.55 with interest at 15% per annum.
2. The defendant in the written statement admitted the purchase of the car
and payment of 10,000 Riyals by the son-in-law of the plaintiff. According to
him, he had spent huge amounts for the purchase of the car and the plaintiff did
not mention the amount spent by him in the plaint. It was the defendant who spent
all the amounts in connection with the delivery of the vehicle. All other
allegations in the plaint regarding payment of the amount by the plaintiff were
denied in the written statement. The defendant due to want of money sold the
vehicle after the ‘no sale’ period. According to him, ‘no sale’ period was more
than 5 years and the bank guarantee given to the Government was forfeited and
the bank instituted O.S.No.8 of 1991 for realisation of the amount. Since the
defendant was working as driver of the plaintiff, he had permitted the plaintiff to
A.S.Nos.809/97 & 845/98 3
use the vehicle for some time and at that time the plaintiff took R.C.Book and
other relevant documents from the car and the same was not returned when
requested by the defendant. Therefore, he applied for duplicate R.C. Book and
sold the car.
3. The trial court raised the following issues
i) Whether the plaintiff is entitled to the
amount claimed in the plaint.
ii) Reliefs and costs.
4. On behalf of the plaintiff, Exts.A1 to A44 were marked and Pws.1 to 5
were examined. On the side of the defendant, Exts.B1 to B18 were marked and
defendant was examined as Dw.1. After trial, the trial court found that the case
set up by the plaintiff was true and that the defendant was liable to pay the
amount incurred by the plaintiff to the plaintiff. Thought a plea of limitation was
not specifically raised and no issue framed, that question also was considered by
the trial court and it was found against.
5. In this appeal, the main points raised are (1) that the contention of the
plaintiff that he spent the entire amount for import of the car was not proved, (2)
that such an agreement was unenforceable in law under S.23 of the Contract Act,
and (3) that the suit itself was barred by limitation as the plaintiff filed the suit
three years after the amount were alleged to have been paid by the plaintiff.
A.S.Nos.809/97 & 845/98 4
Point No.1
6. The learned counsel for the appellant contended that all the documents
produced in the case are in the name of the defendant and therefore the plaintiff
was not entitled to contend that it was he who spent for such payments. It can be
seen from the documents produced in the case that though all the documents were
produced by the plaintiff since the registration of the car was in the name of the
defendant documents could also be only in his name. But the fact remains that it
was the plaintiff who spent those amounts form his pocket as otherwise there was
no possibility of his coming into custody of those documents. The contention of
the defendant that for some time the vehicle was with the plaintiff as the
defendant was earlier the driver of the plaintiff and he had allowed the plaintiff to
use the car and at that time the plaintiff took away all the papers from the car
cannot be believed. There was no necessity for the defendant to keep all the
documents in connection with the purchase and import of the car in the car itself.
Pw.1 was the Joint Regional Transport Officer, Malappuram. He was examined
to prove that the defendant had applied for duplicate R.C. of the car. Ext.X-1
series were got produced to show that the defendant had applied for duplicate
R.C. and that the plaintiff filed objections. But duplicate R.C. was given to the
defendant. Exts.X-1 to X-19 were proved by Pw.2 the Manager of the Vijaya
Bank. The Bank had given guarantee for which the fixed deposit receipts in the
A.S.Nos.809/97 & 845/98 5
name of the plaintiff’s wife were given to the Bank. He has also given evidence
to the effect that the plaintiff’s wife had account in the Bank and on her
application loan was given to her. On her application, Bank guarantee was given
on behalf of the defendant He has also deposed that the plaintiff had withdrawn
an amount of Rs.1,50,000/- as per Ext.X-16 through the defendant. Ext.X-17 is
the copy of S.B.account book of the plaintiff. In cross-examination, he has stated
that a gold loan was taken by the defendant and the Bank had filed a suit against
the defendant for realisation of the loan amount. But he has also stated that the
amount covered by the fixed deposit receipts were adjusted for the loan amount.
Exts.A1 to A12 are the documents produced by the plaintiff to show that it was
he who spent the amount for getting the car cleared from the Customs Department
and the amount of 10,000 Riyal given by the son-in-law of the plaintiff was not
disputed by the defendant. Therefore, the contention of the defendant that the car
was purchased by his own earnings was not believed by the trial court and nothing
has been brought to our notice to hold that the oral and documentary evidence
produced by the plaintiff to substantiate his contention that the car was purchased
with his money and brought to India at his expense was not true. Therefore, we
find against the first point raised by the learned counsel for the appellant.
Point No.2
7. The learned counsel for the appellant contended that the agreement
A.S.Nos.809/97 & 845/98 6
itself is invalid in view of S.23 of the Contract Act and the same was
unenforceable in law. According to the learned counsel, the car brought to India
was a new car and only persons who own a car for their personal use can bring
that car to India whenever returning to India and since the plaintiff and defendant
were parties to the violation of the Foreign Exchange Rules, the plaintiff was not
entitled to enforce the agreement. There is no merit in this contention since as the
trial court has noticed, the only condition for importing the car was that it should
not be sold within two years of such import. It was known as ‘no sale’ period.
After the no sale period the defendant could sell the car to anybody. In this case,
the plaintiff therefore waited till the expiry of the period. We do not find any
such contention raised before the trial court. Though a ground is raised in the
memorandum of appeal that the defendant was bringing a new foreign car, we do
not find any such contention raised in the pleadings in the trial court and in the
absence of necessary materials, it may not be proper for the first appellate court to
consider such point for the first time in appeal as it is a mixed question of fact and
law. What exactly was the violation of the law in the agreement between the
parties and how it was unenforceable in law were all matters which had to be
pleaded and proved by the defendant if he wanted to show that the amount spent
by the plaintiff for the purpose of the car was not realisable by him from the
defendant when it is proved that the defendant did not repay the amount spent by
A.S.Nos.809/97 & 845/98 7
the plaintiff and has sold the car to third party after getting the benefit of the
entire amount spent by the plaintiff. Therefore, this point is also found against the
appellant.
Point No.3
8. The learned counsel for the appellant vehemently argued that at any rate
the suit is barred by limitation. According to the learned counsel, the entire
amounts were spent by the plaintiff prior to 30-3-1987 and the period of limitation
is only three years and it expired on 30-3-1990. The suit was filed only on 19-6-
1991 and since it was filed beyond three years the suit was liable to be dismissed.
As already noticed, though such specific contention was not raised in the written
statement, the trial court has considered this aspect and found that the plaintiff
was entitled to wait till the no sale period was over and it expired only on
20-3-1989. The suit was filed on 19-6-1991. According to the learned counsel
for the appellant in Ext.A31 which is a statement filed by the plaintiff before the
A.R.A.,Malappuram, in connection with the clearance of the car,the plaintiff had
detailed the amounts spent by him and it showed that the plaintiff was prepared
to give the vehicle in case he was paid the entire amount spent by him. Therefore
the claim was only for the amount spent by the plaintiff and Ext.A31 is dated
25-11-1987. According to the learned counsel for the appellant, the plaintiff was
not entitled for more than three years from the date of spending of the amount for
A.S.Nos.809/97 & 845/98 8
the release of the car from the customs as well as for bringing the car to India.
The trial court found that since the plaintiff was entitled to wait till the no sale
period was over and in case he was given the car after the no sale period was
over, there was no necessity for him to file the suit at all. According to the learned
counsel for the appellant, the suit is for realisation of money and the plaintiff was
bound to file the suit within time. The learned counsel for the appellants also
relied on the decision of this Court in State of Kerala v. Thalayar Tea
Company Ltd (1982 KLT 404). Whether Article 24 or Article 113 was the
relevant Article was the question for decision in that case. The facts of the case
are that the plaintiffs had sought for refund of the amount collected as seigniorage.
Earlier, there was a suit filed as O.S.No.70 of 1966 challenging the collection of
seigniorage. Though the trial court dismissed the suit, this Court in appeal
decreed the suit. Thereafter, O.S.No.83 of 1973 was filed for realisation of the
amounts already collected by the Government towards seigniorage, sales-tax and
interest. Therefore the question arose as to which was the starting point of
limitation – whether it was three years when the money was received or three
years after the right accrued. The two Judges of the Division Bench had
difference of opinion and the matter was referred to a third Judge. His Lordship
Justice P.Subramonian Poti, Acting Chief Justice, as His Lordship then was,
opined that the period of limitation started from the date when the money was
A.S.Nos.809/97 & 845/98 9
received and it was further held that when specific Article was applicable, the
residuary Article of the Limitation Act has no application. In this case, we do
not think that that judgment will help the learned counsel for the appellant. This
is not a mere suit for money received by the defendant from the plaintiff. The suit
is filed for all the amounts spent by the plaintiff for the purchase of the car as well
as for getting clearance from the Customs Department and for other incidental
matters. The entire amount was not received by the defendant from the plaintiff.
Therefore, Article 24 of the Limitation Act has no application. If Article 24 has
no application, it is not in dispute that Article 113 will apply in which case the suit
was filed within time as according to the plaintiff, the cause of action arose in the
suit when the defendant refused to transfer the car in favour of the plaitniff after
the no sale period was over.
9. In Thalayar Tea Company’s case, the learned Judge relied on the
decision of the Supreme Court reported in Venkata Subbarao v. State of A.P.
(AI R 1965 SC 1773). That decision itself made it clear that if the right to refund
does not arise immediately on receipt by the defendant but arises by reason of
facts transpiring subsequently Article 62 (Present Article 24) does not apply.
Under Article 113 the starting point of the period of limitation is when the right to
sue accrues. On the facts of this case, it is clear that the plaintiff wanted the car to
be purchased after the no sale period was over. It is only when he found that the
A.S.Nos.809/97 & 845/98 10
car would not be sold to him that his right to sue accrued and the suit is filed
within three years as per the dates given earlier in this judgment. We are inclined
to hold that the suit is not barred by limitation also for the reason that no such
contention was raised and no issue was tried. The question of limitation is a
question of law only if it arises out of admitted facts. If on the averments in the
plaint the suit is not barred by limitation, the defendant will have to deny the
averments and plead that the suit is barred by limitation. In the absence of such
contentions, the averments in the plaint regarding cause of action will have to be
accepted. In that view of the matter also, we are of opinion that the suit is not
barred by limitation. Admittedly, the imported car could not be sold to the
plaintiff within the no sale period and without selling the car to the plaintiff, the
defendant has sold the car to a third party and obtained money from the third
party. When the documents produced proved that the plaintiff has spent the entire
amount and the defendant has received the consideration by sale of the car to a
third person, we do not find any reason to interfere with the judgment of the court
below. The plaintiff is entitled to get the amount from the defendant. The appeal
is liable to be dismissed.
S.A.No.845 of 1998
10. This appeal is filed by the defendant in O.S.No.114 of 1994 on othe
file of the Subordinate Judge’s Court, Tirur. The suit was for realisation of
A.S.Nos.809/97 & 845/98 11
Rs.38,319/- from the appellant with interest at 19.5% per annum.
11. The plaintiff was a guarantor to the defendant for obtaining a bank
guarantee of Rs.58,500/- from Vijaya Bank, Manjeri. The bank guarantee was
required for getting a clearance certificate for a foreign car brought to India by the
defendant. The plaintiff had deposited fixed deposit receipts for Rs.15,000/- with
the Bank as guarantee. She also mortgaged her immovable property for
Rs.58,500/-. For violating the terms of import the Bank guarantee was forfeited.
The bank encashed the fixed deposit receipts of the plaintiff which was given as
security. The maturity value of the fixed deposit receipts was Rs.28,764/-. The
suit was filed to get the amount with interest as well as other amounts spent by
the plaintiff in connection with the guarantee given to the defendant from the
defendant. She also claimed the expenses incurred by her for defending
O.S.No.8 of 1991 a suit filed by the Bank against the defendant whereas the
plaintiff was also made a party.
12. The defendant denied the liability though the transaction was not
disputed. According to him, he had paid the value of the fixed deposit to the
plaintiff when she had handed over the fixed deposit receipts to the Bank. He
also contended that he had discharged the entire amount due to the Bank. After
framing of necessary issues, the trial court granted a decree for Rs.22,537/- with
interest at 12% from 30-3-1990 till realisation.
A.S.Nos.809/97 & 845/98 12
13. In this appeal, the learned counsel for the appellant repeated the
contention of the defendant in the trial court. The point for consideration is
whether the decree of the trial court requires any modification.
14. Though the suit was filed for realisation of Rs.38,319/- with interest at
19.5%, the trial court has not granted the entire amount as claimed. Only the
value of the fixed deposit receitps on maturity was directed to be repaid by the
defendant. In fact there is no dispute before us that the plaintiff had handed over
the fixed deposit receitps to the Bank to enable the Bank to give guarantee to the
Government on behalf of the defendant. The contention that the defendant had
paid the amount covered by the fixed deposit receipts to the plaintiff is not proved
by any evidence whatsoever. Since there is no cross-objection by the plaintiff
for the amount disallowed by the trial court, there is no necessity to consider
that aspect in this appeal. Exts.X-1 to X-13 show that the plaintiff had deposited
the fixed deposit receipts and created equitable mortgage of immovable properties
in favour of the bank. The interest awarded is also reasonable having regard to
the facts of the case and no separate argument was advanced with regard to the
rate of interest. This appeal is also liable to be dismissed.
In the result, both the appeals are dismissed.
.March 3, 2006.
R.Bhaskaran, Judge
A.S.Nos.809/97 & 845/98 13
K.T.Sankaran, Judge.
“C.R”
R.Bhaskaran & K.T.Sankaran, JJ
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A.S.Nos.809/97 & 845/98 14
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A.S.Nos.809 of 1997 & 845 of 1998
Judgment
March 3, 2006.
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