Madras High Court
S.Niramal Devi vs M.Venislas ... 1St on 7 April, 2022
A.S(MD)No.81 of 2020
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 07.04.2022
CORAM:
THE HONOURABLE MR.JUSTICE R.SUBRAMANIAN
AND
THE HONOURABLE MR.JUSTICE N.SATHISH KUMAR
A.S(MD)No.81 of 2020
and
C.M.P(MD)No.2808 of 2020
S.Niramal Devi ... Appellant/1st defendant
.vs.
1.M.Venislas ... 1st Respondent/Plaintiff
2.A.Gamaliel Jebakumar ... 2nd respondent/2nd defendant
PRAYER: Appeal filed under Section 96 of C.P.C., against the judgment
and decree passed in O.S.No.127 of 2009 on the file of the Additional
District and Sessions Judge(Fast Track Court), kanniyakumari at
Nagercoil, dated 10.01.2019.
For Appellant :C.Sankar Prakash
For R-1 :Mr.T.Selvakumaran
For R-2 :No Appearance
JUDGMENT
*********
R.SUBRAMANIAN,J.
AND
N.SATHISH KUMAR , J.
Since the scope of the appeal is limited, with the consent of the
parties, the appeal itself is taken up for final hearing.
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A.S(MD)No.81 of 2020
2. This appeal is at the instance of the first defendant in
O.S.No.127 of 2009 on the file of the Additional District and Sessions
Judge(Fast Track Court), Kanniyakumari at Nagercoi, a suit for specific
performance launched by the first respondent herein seeking specific
performance of an agreement of sale, dated 07.03.2007. According to
the plaintiff, the defendants agreed to sell the property measuring about 7
cents for a total consideration of Rs.15,90,000/- and the same was
witnessed by agreement in writing dated 07.03.2007. Apart from paying a
sum of Rs.3,05,000/- as advance on the date of the agreement, the
plaintiff had paid further amounts on various dates amounting to
Rs.13,55,000/-. Offering to pay the balance of sale consideration, the
plaintiff launched the suit on 27.07.2009. It is the case of the plaintiff
that despite offers made to pay the balance of sale consideration, the
defendants did not come forward to execute the sale deed.
3. The suit was resisted by the defendants contending that the suit
agreement was not intended to be a sale agreement. It was only a loan
transaction which was camouflaged for an agreement of sale.
4. The learned trial Judge on consideration of the evidence on
record, rejected the defence to the effect that it is the loan transaction.
He however concluded that the plaintiff was not ready and willing to
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A.S(MD)No.81 of 2020
perform his part of the contract. Therefore, he is not entitled to the
discretionery relief of specific performance. The learned trial Judge
however granted a decree of refund of fund with interest at the rate of
24% per annum from the date of agreement till the date of decree. The
learned trial Judge also awarded mandatory costs under Section 74-A of
Tamil Nadu Court-Fees and Suits Valuation Act.
5. The plaintiff has not chosen to appeal against the decree. The
first defendant has come up on appeal questioning the interest awarded
by the learned trial Judge.
6. We have heard Mr.C.Sankar Prakash, learned counsel appearing
for the appellant and Mr.T.Selvakumaran, learned counsel appearing for
the first respondent.
7. Mr.C.Sankar Prakash, learned counsel appearing for the
appellant, would vehemently contend that the trial Court was not justified
in awarding exorbitant interest from the date of agreement till the date of
decree. He would also fault the learned trial Judge for having awarded
mandatory costs on the conclusion that the defence is frivolous.
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A.S(MD)No.81 of 2020
8. Contending contra, Mr.T.Selvakumaran, learned counsel
appearing for the first respondent, would submit that the trial Court was
justified in awarding 24% interest since the plaintiff has parted with
almost the entire sale consideration.
9. On the contentions of the learned counsel appearing for the
parties, the following points emerge for consideration in this appeal:
“(i)Whether the trial Court was justified in
granting interest at the rate of 24% per
annum from the date of agreement till the
date of decree? ;and
(ii)Whether the trial Court was justified in
granting mandatory costs under Section 74-A
of the Tamil Nadu Court-Fees and Suits
Valuation Act?
10. The trial Judge has recorded a finding that the plaintiff was
not ready and willing to perform his part of the contract. The suit being
one for specific performance, the very essential requirement has not been
satisfied. Therefore, the trial Court was justified in dismissing the suit.
However, while granting a decree for return of advance amount, the trial
Court went astray and granted interest at the rate of 24% per annum,
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A.S(MD)No.81 of 2020
even though in the plaint the plaintiff has sought for refund of advance
amount with interest at 12% and even in the pre-suit notice, the
defendants had offered to repay the advance amount with 12% interest.
11. Section 34 of the Civil Procedure Code, enables the Court
to grant pendente lite interest in a decree for payment of money, but the
said interest must be reasonable. The Court must also take into account
the interest prevailing in the finance market. It cannot direct payment of
interest at higher rate than what is prevailing in the market. Today, the
bank rates are as low as 5% or 6%. Therefore, we are unable to sustain
the grant of interest by the trial Court at the rate of 24% per annum.
However, in view of the admission made by the defendants in Ex.A5-reply
notice, to the effect that they are prepared to repay the advance amount
with interest at 12%, we deem it fit to reduce the interest from 24% to
12%.
12. Adverting to the award of mandatory costs, the trial Court
had relied upon Section 74-A of the Tamil Nadu Court Fees and Suits
Valuation Act, to grant additional costs of Rs.1,04,662.50/- being the
actual court fee paid apart from awarding the suit cost of
Rs.1,40,969.50/-.
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A.S(MD)No.81 of 2020
13. Section 74-A of the Tamil Nadu Court Fees and Suits
Valuation Act, reads as follows:-
“74-A. Mandatory costs.— In frivolous or speculative
litigation, the court shall award cost to the winning party,
which shall be the actual cost or equal to the value of court-
fee paid by the winning party whichever is less.”.
14. A reading of the above provision shows that the Court is
compelled to award the actual cost to the winning party if it comes to the
conclusion that the litigation is frivolous or speculative. The Section in our
considered opinion does not empower the Court to award double cost.
The effect of the Section is only to take away the discretion vested in the
Court to award costs in certain contingencies.
15. We are unable to sustain the decree of the trial Court
awarding costs of Rs.1,40,969.50/- and awarding another set of cost at
Rs.1,04,662.50/-. The plaintiff has succeeded in obtaining the relief of
refund of advance and therefore, he would be entitled to the costs to that
extent. We are, therefore, unable to sustain the decree for payment of
Rs.1,44,662.50/- as additional costs under Section 74-A of the Tamil
Nadu Court Fees and Suits Valuation Act.
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A.S(MD)No.81 of 2020
16. This appeal is therefore allowed. The decree of the trial
Court dated 10.01.2019 in O.S.No.127 of 2009 on the file of the
Additional District and Sessions Judge(Fast Track Court), kanniyakumari
at Nagercoil, is modified to the effect that the pendente lite interest
awarded at the rate of 24% per annum from the date of agreement till
the date of decree, is reduced to 12% per annum from the date of
agreement till the date of decree and Clause – 4 of the decree relating to
mandatory costs, is set aside. In all other aspects, the decree of the trial
Court shall remain unaltered. There will be no order as to costs in this
appeal. Consequently, connected Miscellaneous Petition is closed.
[R.S.M.,J.] [N.S.K.,J.]
07.04.2022
Index:Yes
Internet:Yes
pm
To:
1.The Additional District and Sessions Judge
(Fast Track Court), kanniyakumari at Nagercoil.
2.The Section Officer,
Vernacular Section,
Madurai Bench of Madras High Court,
Madurai.
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A.S(MD)No.81 of 2020
R.SUBRAMANIAN, J.
AND
N.SATHISH KUMAR, J.
pm
JUDGMENT MADE IN
A.S(MD)No.81 of 2020
07.04.2022
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