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Judgment
RFA No. 555/2013 is filed against the decree and judgment in O.S. No. 734/2011 and RFA No. 687/2013 is from the judgment and decree in O.S. No. 919/2009.
We have heard Sri. Leo George, the learned counsel appearing for the appellant in RFA No. 555/2013 and the respondent in R.F.A. No. 687/2013 and Sri. S. Santhosh Kumar also for the appellant in RFA No. 687/2013 and for the respondent in RFA No. 555/2013.
The facts in a nutshell are the following :-
The appellant in RFA No. 555/2013 owns a cashew factory, which is plaint A schedule property. Plaint B schedule is the movables in plaint A schedule property. Between the appellant/plaintiff and the respondent/defendant, Ext. A1 licence deed was executed on 17.6.2009 whereby the respondent/defendant was permitted to run the factory for a period of 5 years on an annual licence fee of Rs. 1,00,000/-. There was a condition that if the plaintiff desires to sell the factory, the defendant shall surrender the factory to her. It is averred in the plaint that even though the defendant was called upon by the plaintiff to surrender the factory when there was a proposal to sell the factory, the defendant refused to surrender the same and accordingly, the suit was filed.
Various contentions were raised by the respondent/defendant including one that the licence is irrevocable. It was further contended that there was an oral agreement between the parties to renew the licence for a further period of five years from 2014 and that the plaintiff had collected a sum of Rs. 5,50,000/- from the defendant on the date of execution of Ext. A1 agreement towards the rent payable for the period after 2014. Accordingly a counter claim has also been raised by the respondent for the declaration that he is entitled to get the licence arrangement renewed for a further period of five years from 17.6.2014 and for a mandatory injunction directing the plaintiff to execute necessary document to enable him to occupy the factory for the extended period also.
O.S. No. 919/2009 is filed by the appellant in RFA No. 687/2013 seeking a decree of prohibitory injunction restraining the respondent herein, who is the plaintiff in O.S. No. 734/2011 from dispossessing him from the factory forcibly and for recovery of certain amounts.
Both the suits were tried together, considering O.S. No. 919/2009 as the leading case.
Before the court below, the plaintiff in O.S. No. 919/09 was examined as PW1 and another two witnesses were examined as PW2 and PW3 and Exts. A1 to A13 were marked from the side of the plaintiff. The husband of the defendant in the said suit was examined as DW1 and another witness was examined as DW2 and Exts. B1 to B11 documents were produced.
By the impugned judgment it was held that the plaintiff in O.S. No. 919/2009 is entitled to partly succeed in his case as well as in the counter claim filed in O.S. No. 734/2011 and plaintiff in O.S. No. 734/2011 is also found to be partly entitled to the relief prayed for.
Accordingly in O.S. No. 734/2011, the defendant is directed by an order of mandatory injunction to surrender vacant possession of the plaint properties after receiving back the advance rent paid for the unused portion of the remaining period. The plaintiff in O.S. No. 919/2009 is allowed to recover Rs. 2,27,246/- paid as bonus with interest at the rate of 6% per annum from 26.8.2009, namely, the date of payment of bonus till realisation from the defendant. The counter claimant in O.S. No. 734/2011, the plaintiff in O.S. No. 919/2009 is also allowed to recover Rs. 5,50,000/-, the advance rent paid for the period 2014-2019 with interest at the rate of 6% from 17.6.2009 till realisation from the defendant and her assets.
Parties are referred to as arrayed in RFA 555/13. As far as R.F.A. No. 555/13 is concerned, learned counsel for the appellant attacked the finding that the respondent had paid an advance rent for Rs. 5,50,000/- for the period from 17.6.2014 to 16.6.2019. It is submitted by placing reliance on Ext. B10, that the payment was received for the value of the stock at the time of execution of Ext. A1. It is further pointed out that after Ext. A7 was served on the respondent, directing the respondent to vacate the premises within thirty days, by Ext. A8 reply was given, wherein, no such plea was taken. Therefore, it is submitted that the case pleaded in the written statement is a new one. It is also submitted that the court below went wrong in relying upon Exts. A10, A12 and A13.
Learned counsel for the respondent submitted that as far as the value of the stock is concerned, for more reasons than one, the case of the appellant cannot be accepted. It is submitted that in Ext. A1, there is no such clause for payment of value of stock. Secondly, it is submitted that Ext. B10 cannot be accepted as a correct and true document. The reasons stated by the court below, to reject the same are supportable. At any rate, the plaintiff/appellant has no case that the tax component has been met which itself is sufficient to reject the contentions of the appellant. Apart from the same, since, the payment of Rs. 5.50 lakh is admitted, on the strength of Exts. A10, A11, A12 and A13, the only finding that can be made is the one now arrived at by the court below.
We have perused relevant documents including Exts. A1, A7, A8, A10 & Ext. B10. Ext. A1 is the licence agreement executed between the parties. In clause (2), it is provided that the licence would be for a period of five years from 17.6.2009 and ending on 16.6.2014. However, this licence is extendable on mutually agreed terms and conditions. According to the learned counsel for the respondent, the appellant was hard pressed for money for meeting various demands at the point of time and there were recoveries from financial institutions.
First we will come to the Stock Register-Ext. B10. Learned counsel for the appellant invited our attention to various entries therein including the last entry showing the quantity of different types of materials and the value put against each items at a total amount of Rs. 5,50,000/-. The court below has found that even the signature shown under the seal of the respondent does not inspire confidence. According to us, we need not go into such a controversy, especially, in the light of the fact that Ext. A10 voucher shows the payment as rent advance for the period from 17.6.2014 to 16.6.2019 which is having the signature of the appellant/plaintiff. Even though, learned counsel for the appellant submitted that the voucher does not contain the serial number, in the light of the entries in Ext. A11, the Ledger Account and especially at page 86 and Ext. A12, the Cash book of the plaintiff in page No. 35, we do not agree with the said contention. Even though, learned counsel for the appellant submitted that the above documents could not have been acted upon, we are of the view that, Ext. A11 being the Ledger Account of the Unit and Ext. A12 being the Cash Book which contains various entries for a long period and against which no other adverse circumstances are pointed out for not accepting the same and since the burden of proof is really on the appellant to prove that the amount represents the value of the stock, we do not accept the plea of the appellant. It is clear that Exts. A11 to A13 have been maintained as true and correct accounting as common course of events. In paragraph 10 of the judgment, the lower court has attributed various reasons for rejecting Ext. B10 which cannot said to be unacceptable. Apart from the same, if the amount was mentioned as really for the value of the stock, it would have reflected in the agreement Ext. A1 itself, since such an amount could have been arrived at only by consensus between the two parties regarding the quantity of the stock and its value. One of the other reasons which persuade us to reject the appellant's case is that Ext. B10 do not show the tax liability for effecting the sale. As rightly pointed by the learned counsel for the respondent, the same will also fly up to the face of the appellant. For all these reasons we are unable to agree with the contentions of the appellant.
In the Cross Objection No. 106/2013 filed in RFA 555/13, two items of grounds have been raised therein. One regarding the rejection of the claim for value of improvements for Rs. 1,50,000/- and the other regarding refund of a decree for realisation of an amount of Rs. 2 lakh towards damages for breach of agreement. We will consider it along with points raised in R.F.A. 687/2013 also. The appeal is confined to the refusal to grant permanent prohibitory injunction in favour of the appellant.
Learned counsel for the appellant Sri. S. Santhosh Kumar argued that the plaint schedule item C is a construction made by the appellant/defendant in the suit (Cross Objector) and what is claimed is the amount spend for the construction of the same. That is dealt with in paragraphs 14 to 18 of the judgment. The finding is on the issue No. 5 & 6. Even though, the appellant relied upon clause (b) of Section 60 of the Easements Act, the said contention was not accepted by the court below. Mainly, it is a case where the court was of the view that none of the ingredients of section 60 are attracted. First one is that licensee should have executed a work of a permanent character. Second one is that he did so upon the licence. Third one is that he incurred expenditure in execution. It was found that 3rd condition alone has been satisfied in this case. We have also perused the reports Exts. C1 and C2. According to the learned counsel for the plaintiff in O.S. 734/2011, it is only a temporary construction which is attached to the main factory building and it cannot, at any cost be imagined it as a work of a permanent character. According to the learned counsel even if the entire description in the Commission report is accepted what is discernible is only that the shed has been given a roofing with using naga sheets which cannot come into the ambit of Section 60(b) of the Easements Act.
There is no provision in Ext. A1 permitting the appellant to put up such a construction. Therefore it is not supported by any of the clauses in Ext. A1. Apart from the same, it cannot be termed as a work of a permanent character. Ext. C1 and C2 shows that it was only an extension attached to the factory building. Even a close reading of relevant clauses in Ext. A1 will show that what is permitted is only effecting repairs and maintenance and not other constructions. In That view of the matter, we do not find any reason to interfere with the said finding.
Regarding the damages claimed also, we agree with the view taken by the trial court. The agreement as rightly pointed out by the learned counsel for the plaintiff in O.S. No. 734/2011 allowed the plaintiff therein to recall the agreement in case a buyer approaches the plaintiff for sale and the plaintiff ultimately decided to sell the property and the said clause is one mutually agreed to by the parties. Hence, it cannot be said that it will result in a breach of the agreement itself enabling the appellant in RFA 687/2013 to claim damages. Sri. S. Santhosh Kumar submitted that the demand was made within four months of the date of execution of the agreement and without any bonafides. But as the plaintiff in O.S. No. 734/2011 was armed with said clause and was only invoking the same, we cannot agree with the contention that there is a total breach of the contract enabling the appellant in RFA 687/2013 to claim damages and the court below has rightly rejected the claim. We find also that the appellant in RFA 687/2013 was in possession of the property and the five year period that expired only on 16.6.2014.
Therefore, we do not find any reason to allow the Cross Objection No. 106/2013 in RFA No. 555/2013. As regards the refund to grant decree for prohibitory injunction also, the same do not call for interference as the licence is revocable. Accordingly, the appeals and the cross objections are liable to be dismissed.
Normally, the same would have disposed of the appeals, but in the light of the fact that certain disputes have been raised with regard to the valuation of the counter claims filed before the court below which may have reflected on the valuation and payment of court fee in RFA 687/2013 and Cross Objection 106/2013, we think it proper to advert the contentions there. Learned counsel Sri. Leo George submitted that in the counter claim filed by the defendant in O.S. No. 734/2011, a reading of the relevant portion shows that independent reliefs have been claimed. Our attention was invited to the first relief where a declaration is sought that the counterclaim plaintiff is entitled to get extended the licence for a further period of fie years with effect from 17.6.2014 to 16.6.2019 and to continue in the premise for such period as licensee of the counterclaim defendant. The relief No. (b) is one by way of a mandatory injunction directing the counterclaim defendant to execute necessary deed of license in favour of the counterclaim plaintiff for extending the licence for a further period of five years with effect from 17.6.2014 to 16.6.2019 in consideration of the licence fee of Rs. 5,50,000/- already collected by the counterclaim defendant from the counterclaim plaintiff. By relief No. (c), a mandatory injunction is sought directing the counterclaim defendant to return to the counterclaim plaintiff a sum of Rs. 5,50,000/- collected by her in advance on 17.6.2009 together with its interest accrued at the rate of 18% per annum from 17.6.2009 till date of payment etc. Relief No. (d) is to allow the counterclaim plaintiff to recover the sum of Rs. 1,50,000/- being the value of improvements made by the counterclaim plaintiff in the A scheduled land by erecting the C schedule working shed together with its interest at the rate of 18% per annum charged on the A & B schedule properties. Relief No. (e) is to allow the counterclaim plaintiff to recover and realise Rs. 2,00,000/- towards damages for breach of the agreement for extending the licence.
Arguments have been heard on either side on the sufficiency of the valuation and payment of court fee. We have gone through paragraph 10 of the counter claim. It reads as follows:
"For the purpose of court fee and jurisdiction, the suit is valued at Rs. 1000 in respect of relief (a) declaration and Rs. 500/- for the relief (b) mandatory injunction and the other relief being ancillary and consequential to the main relief, need not be separately valued and no separate court fee need be paid in view of the proviso to Section 6(1) of the Kerala Court fees and Suits Valuation Act. The Counterclaim plaintiff is herewith remitting a court fee of Rs. 60/- under S. 25(b) and S. 27(c) of the Kerala Court Fees and Suits Valuation Act."
As far as relief No. (a) is concerned, it will be a case where Section 25(b) will apply and as far as relief No. (b) is concerned, Section 27(c) of the Court Fee and Suit Valuation Act will apply. Section 22 of the Act will apply in the case of relief No. (c), (d) & (e).
Then the question is how and in what manner the court fee will have paid. Learned counsel Sri. Leo George submitted that Section 7(3) will apply as far as relief No. (a). Learned counsel Sri. S. Santhosh Kumar submitted that under Section 7(4) alone will apply. After reading through Section 7(3) and 7(4) of the Court Fee and Suit Valuation Act, we are of the view that, Section 7(4) alone will apply since the claim by plaintiff in O.S. No. 919/2009 is a fractional interest.
Coming to the provision under which the relief can be valued and the court fee is chargeable, what is important will be Section 6(2) of the Court Fees and Valuation Act, which will show that where more reliefs than one based on the same cause of action are sought in the alternative in any suit, the plaint shall be chargeable with the highest of the fees leviable in respect of any one of the reliefs. If any of the course are also adopted what we find is that valuation for relief No. (c) under Section 6(2) will be higher. But as rightly pointed out by learned counsel Sri. Leo George the appellant in RFA 687/2013 (respondent in RFA 555/2013) will have to add the interest also and pay court fee accordingly.
In the light of Section 12(4) of the Court Fees and Suit Valuation Act, the appellate court has power to consider the correctness of the court fee paid on the plaint before the court below and determine the proper fee payable thereon.
At this stage, learned counsel for the appellant in RFA No. 687/2013 Sri. S. Santhosh Kumar submitted that, as far as the prayer Nos. (d) and (e) is concerned, he is relinquishing the claims in the appeal and Cross Objection No. 106/2013. Therefore, we will restrict the direction regarding the payment of court fee in the suit O.S. No. 919/2009 as well as in the counter claim in O.S. No. 734/2011. Accordingly, we direct the plaintiff in RFA 687/2013 who is the counterclaim petitioner to remit the court fee payable in tune with the findings rendered above within a period of one month.
As far as the obligation of the appellant in RFA 687/2013 to vacate the premises concerned, learned counsel submitted that he may be allowed to continue till 31.10.2014. It is also stated that the appellant will have to bear the burden for payment of bonus which will have to be shared by the appellant in RFA 555/2013 from 1st November 2014 to 31st December 2014. Learned counsel for the plaintiff in O.S. No. 734/2011 submitted that the liability for payment of bonus for that period will be shared.
We permit the appellant in RFA 687/2013 to continue occupation of the factory and he will vacate the premises by 31.10.2014. He will file an undertaking to the above effect in the court below within a period of one month. Continuance will be on the same terms, viz. payment of Rs. 1,10,000/- yearly rent as occupational charges and the plaintiff in O.S. No. 734/2011 will be free to adjust the said amount on the amount payable to the plaintiff in O.S. No. 919/2009 (from the amount Rs. 5,50,000/- decreed by the court below).
It is submitted by the learned counsel for the appellant in RFA 555/2013 that his client has deposited Rs. 1,08,000/- before the execution court in tune with the directions in the impugned judgment on 22.10.2013 as rent for the unused portion till 16.6.2014. Now as we have permitted the plaintiff in O.S. No. 919/2009 to continue in occupation till 31.10.2014, we permit the plaintiff in O.S. No. 734/2011 to withdraw the said amount from the court below and the court below will pass appropriate orders for refund of the same. Parties will suffer their costs in the appeal. Accordingly, the appeals are dismissed subject to the directions made regarding the payment of court fee.