Madras High Court
E. Kandhan vs M/S.Assured Capital Services on 15 December, 2021
C.S. No.155 of 2021
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED :15.12.2021
CORAM:
THE HONOURABLE MR.JUSTICE ABDUL QUDDHOSE
C.S. No.155 of 2021
1. E. Kandhan
2. K.Santhanalakshmi
3. K. Yamini
4. E. Ramadoss
5. R. Vasantha
6. S. Udayarekha
7. E. Srinivasan
8. S. Jothilakshmi ... Plaintiffs
vs
1. M/s.Assured Capital Services,
Represented by its Managing Partner,
Balachandar
2. R. Balachandar
3. Shahul Hameed
4. Selvakumar ... Defendants
Prayer: Civil Suit filed under Order VII Rule 1 of the Code of Civil
Procedure and Order IV Rule 1 of the Original Side Rules, 1994 to pass a
judgment and decree for the following reliefs:-
1/13
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C.S. No.155 of 2021
a) Directing the defendants to jointly and severally
pay a sum of Rs.77,71,644.50 (Rupees seventy Seven lakh
seventy one thousand six hundred forty four and fifty one paise)
together with interest at 18% per annum from the date of plaint
till the date of realisation.
b) Directing the defendants, jointly and severally, to
pay a sum of Rs.25,00,000/- (Twenty five lakhs only) as
damages to the plaintiffs for mental pain and suffering caused
on account of the misappropriation and fraud perpetrated by the
defendants :
c) To pay the costs of this suit :
d) To grant such other reliefs
For Plaintiffs : Mr.Sharath Chandran
JUDGMENT
The suit has been filed for recovery of a sum of
Rs.77,71,644.51 against the defendants jointly and severally together
with interest and costs. The plaintiffs have also sought for a recovery of
a sum of Rs.25,00,000/- as damages for the mental pain and suffering
caused on account of the misappropriation and fraud perpetrated by the
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C.S. No.155 of 2021
defendants.
2. The plaintiffs are members of one family. The second and
third plaintiff are the wife and daughter of the first plaintiff. The fifth
plaintiff is the sister of the first plaintiff. The fourth plaintiff is her
husband. The seventh plaintiff is the brother of the first plaintiff. The
eighth plaintiff is the wife of the seventh plaintiff. The sixth plaintiff is
the sister-in-law of the first plaintiff. The plaintiffs have collectively, as
one family, invested sums in the 1st defendant firm. The first defendant
firm is run by defendants 2-4. The defendants 2 to 4 used the first
defendant firm as a front to lure innocent citizens to invest their hard
earned savings with a promise to return double the value in a short span
of 134 days.
3. According to the plaintiffs lured by the representations of the
defendants, the first plaintiff invested a sum of Rs.14,00,000/- with the
first defendant which was transferred to the account of the first defendant
by the first plaintiff through RTGS transactions, i.e., on 13.12.2018
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C.S. No.155 of 2021
(Rs.2,00,000/-); on 07.01.2019 (Rs.6,00,000/-) and on 10.01.2019
(Rs.6,00,000/-). According to the first plaintiff, his bank statements
prove that the aforementioned transfers were made by the first plaintiff to
the account of the first defendant. According to the first plaintiff, the
first defendant issued a welcome letter dated Nil informing the first
plaintiff that his money has been invested in seven different package
plans with different daily pay outs. Under the seven payout plans, the
first plaintiff has to be paid daily pay outs of Rs.21,000/- for a period of
134 days. According to the first plaintiff, pay outs were made by the first
defendant only for the first few days and thereafter no pay outs were
made by the first defendant.
4. According to the first plaintiff, the second and third and
fourth defendants visited the first plaintiff from time and time and
requested him to invest more money through his family and well wishers.
According to the first plaintiff, he did not suspect the sinister motives of
the defendants and he did not suspect that the entire operation of the first
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C.S. No.155 of 2021
defendant was a scam luring innocent investors to part with their hard
earned money. It is the case of the first plaintiff that several investors
who have fallen prey to the fraud perpetrated by the defendants and they
have been cheated to the extent of crores of rupees on the promise that
their investment will be doubled in return.
5. According to the first plaintiff on the strength of the
fraudulent representations, he also invested another sum of
Rs.14,00,000/- in the name of his wife, the second plaintiff herein and the
said amount was also transferred through RTGS to the account of the first
defendant. As in the case of the investment made by the first plaintiff,
same assurances were given by the first defendant for the investment
made in the name of the second plaintiff also as the first defendant
promised the very same return as was promised to the first plaintiff for
his investment.
6. The third plaintiff is the daughter of the first plaintiff and the
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C.S. No.155 of 2021
first plaintiff has similarly invested another sum of Rs.14,00,000/- in her
name with the first defendant and the same returns were promised.
7. As in the case of the plaintiffs Nos.1, 2 and 3, the other
family members of the first plaintiff viz., 4th, 5th, 6th, 7th 8th plaintiffs have
also invested a sum of Rs.6,00,000/- each, totally amounting to
Rs.30,00,000/- with the first defendant company and similar returns were
also promised to them as was promised to the plaintiffs 1 to 3 for their
investments. Even for them also excepting for making pay outs for few
days, the first defendant stopped making any pay outs thereafter. On
28.02.2019, a video is released by the second defendant tendering
unconditional apology for the delay and promising the repayments to the
investors from 12.03.2019. According to the plaintiffs the said promise
was also not kept. The first plaintiff has lodged a criminal complaint
against the defendants on 27.03.2019 with regard to the non return of the
investments and an FIR in Crime No.156 of 2019 came to be registered
against the defendants by the Crime Branch on 06.05.2019 for offences
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C.S. No.155 of 2021
under Sections 409, 420 and 34 of the IPC. It is the case of the
plaintiffs, that the 2nd defendant was arrested and later released on bail.
According to the plaintiffs, it was learnt that the defendants had colluded
with the Assistant Commissioner of Police, Thanavel and had attempted
to escape the clutches of the law. According to the first plaintiff, he
filed Crl. O.P. No.7622 of 2020 before this Court and by order dated
15.05.2020, this Court was pleased to direct the investigation to be
monitored by the Deputy Commissioner of Police CCB, Vepery, Chennai.
8. Since the amounts have not been refunded till date with the
promised return, the plaintiffs have filed the suit and they have given the
particulars of the dues payable to them in paragraph No.12 of the plaint,
which is extracted hereunder :
Name Balance outstanding as
on 28.10.2020 (Except
Mrs.Udayarekha)
E. Kandhan 13,50,624.66
K.Santhanalakshmi 14,37,091.18
K. Yamini 14,21,705.68
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C.S. No.155 of 2021
E. Ramadoss 6,76,567.5
R. Vasantha 6,76,567.5
Udayarekha (from 7,88,493.49
30.01.2019)
E. Srinivasan 7,10,297.25
Jothilakshmi 7,10,297.25
Total 77,71,644.51
9. The plaintiffs have also sought damages for the mental
agony and pain caused to them for a sum of Rs.25,00,000/-. This Court
by its order dated 26.08.2021 passed in A. No.1658 of 2021 permitted the
plaintiffs to combine their cause of action against the respondents /
defendants since all the plaintiffs are family members and all of them
have been deceived by the defendants with regard to the investments
made by them with the first defendant Company.
10. Substituted Service was ordered by this Court for service of
suit summons on the defendants as the suit summons sent earlier by the
plaintiffs were evaded by the defendants. The defendants were set
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C.S. No.155 of 2021
exparte by this Court on 02.12.2021.
11. Mr.E. Kandan, the first plaintiff was examined as a witness
(PW1) before the learned Master and he has deposed on behalf of the
remaining plaintiffs also. In his deposition in the form of proof affidavit,
he has reiterated the contents of the plaint filed in support of C.S. No.155
of 2021. Through PW1, the following documents have been marked as
Exhibits :
Exhibits Nature of the document
Ex.P1 Online copy of investment details along with certified copy of
bank statement of 1st plaintiff (65B certificate)
Ex.P2 Online copy of investment details along with certified copy of
bank statement and money transfers of K.Santhanalakshmi
(65B certificate)
Ex.P3 Online copy of investment details and along with certified
copy of bank statement money transfers of Miss. Yamini(65B
certificate)
Ex.P4 Online copy of investment details along with certified copy of
bank statement and money transfers of Ramadoss (65B
certificate)
Ex.P5 Online copy of investment details along with certified copy of
bank statement and money transfers of E. Vasantha (65B
certificate)
Ex.P6 Online copy of investment details along with certified copy of
bank statement and money transfers of S. Udayarekha (65B
certificate)
Ex.P7 Online copy of investment details along with certified copy of
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C.S. No.155 of 2021
Exhibits Nature of the document
bank statement and money transfers of E. Srinivasan (65B
certificate)
Ex.P8 Online copy of investment details along with certified copy of
bank statement and money transfers of S. Jothilakshmi (65B
certificate)
Ex.P9 (Series Email sent by the 1st defendant (65B certificate)
No.6
documents)
Ex.P10 Certified copy of the complaint given by the 1st plaintiff dated
27.03.2019
Ex.P11 Certified copy of FIR 156 of 2019 dated 08.05.2019
Ex.P12 Certified order passed in Cr. OP No.7622 of 2020
12. As seen from the pleadings and the evidence available on
record, it is clear that all the plaintiffs have invested a total sum of
Rs.72,00,000/- with the first defendant in which, the second, third and
fourth defendants are its Directors and who have deceived the plaintiffs
in investing huge sums of money on the promise of providing substantial
returns for their investments.
13. The first plaintiff has also lodged a criminal complaint
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C.S. No.155 of 2021
against the defendants and an FIR has been registered which is under
investigation by the police and the proof of the same has also been filed
which has been marked as Ex.P11 and Ex.P12. The details of the
investments made by the respective plaintiffs have also been marked as
Exhibits Viz., Ex.P1 to P8.
14. The details of the outstanding amount due and payable by
the defendants to the plaintiffs have also been disclosed in paragraph
No.12 of the plaint, which is in accordance with the agreement between
the plaintiffs and the defendants. However, apart from seeking for
recovery of the investments made by the respective plaintiffs together
with their returns and interest, the plaintiffs have also claimed
compensation towards mental agony on account of the fraud committed
by the defendants to the extent of Rs.25,00,000/-. No evidence has been
placed by the plaintiffs with regard to the said claim. The learned
counsel for the plaintiffs on instructions would also submit that he is not
pressing the claim for damages. The said statement is recorded by this
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C.S. No.155 of 2021
Court.
15. After perusing and examining the pleadings as well as
evidence available on record, this Court is inclined to decree the suit
insofar as the prayer No.(a) found in the paragraph No.17 of the plaint is
concerned and insofar as prayer No.(b) in paragraph No.17, it is
disallowed. The suit is therefore decreed for a sum of Rs.77,71,644.51,
together with interest at 18% p.a. from the date of plaint till the date of
realisation and the plaintiffs are also entitled for the costs of the suit.
15.12.2021
Index:Yes/No
Internet : Yes / No
Speaking Order: Yes/No
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C.S. No.155 of 2021
ABDUL QUDDHOSE, J.
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C.S. No.155 of 2021
15.12.2021
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