Raj Kumar v. Darshan Chawla

1. The present Regular Second Appeal has been filed under Section 100 of CPC challenging the order and judgment dated 25.10.2017 passed by learned Additional District Judge-02, North, Rohini Courts, Delhi in Regular Civil Appeal No. 5/17 titled Sh. Raj Kumar vs. Sh. Darshan Chawla, vide which judgment dated 26.07.2016 passed by learned JSCC-Cum-ASCJ- Cum- GDN Judge, North, Rohini Courts, Delhi in Civil Suit No. 534433/16 titled Darshan Chawla vs. Raj Kumar was upheld.

2. Briefly stated, the facts of the case are that the respondent (hereinafter referred to as „Plaintiff‟) filed a suit for the recovery of Rs. 2,66,220/along with pendent lite and future interest. It has been alleged in the plaint that the appellant (hereinafter referred to as „Defendant‟) had approached the Plaintiff for financial assistance in purchasing a flat from the DDA and persuaded the Plaintiff to extend monetary help. Consequently, a sum of Rs. 2,40,000/- was paid by the Plaintiff at the request of the Defendant for the purchase of Flat No. GH-4/365, LIG, First Floor, Sector-28, Rohini, Delhi. It was further stated in the plaint that the Defendant and his wife executed a receipt dated 02.11.2012, acknowledging receipt of Rs. 2,40,000/- and the Defendant represented that the amount was deposited with the DDA and assured the Plaintiff that it would be returned as and when released by the authority. However, the Defendant failed to return the amount. It later transpired to the Plaintiff that the funds had already been released to the Defendant‟s account. A legal notice was duly served on the Defendant, which was refused and the Plaintiff filed the Civil Suit bearing NO. 534433/16

3. In the written statement, the Defendant objected to the suit stating that the suit was based on a false and fabricated story. The Defendant objected to the claim that any loan had been taken from the Plaintiff and the execution of the receipt acknowledging the payment was vehemently denied. It was stated that the Plaintiff had purchased a flat from the Defendant, which had been allotted to them by the DDA. And after the terms and conditions between the parties were finalized a sale deed was executed in the name of Mrs. Raj Chawla, the Plaintiff‟s wife. The Defendant asserted that they were under the impression that the Plaintiff would make the full payment as committed. However, instead of fulfilling this commitment, the Plaintiff filed the present suit for recovery. Defendant in the written statement stated that there was no privity of contract between the parties, and therefore, the suit was liable to be dismissed.

4. After the completion of the pleadings, learned Trial Court framed the following issues: “Whether the plaintiff is entitled to the money decree along with interest as prayed for ? OPP Whether the suit filed by the plaintiff is liable to be dismissed for want of cause of action ? OPD”

5. Learned Trial Court after appreciating the evidence advanced by the parties and after perusing the record inter alia decreed the suit in favour of the Plaintiff. Aggrieved of this, the Defendant filed a Regular Civil Appeal No. 5/17 titled Sh. Raj Kumar vs. Sh. Darshan Chawla, on the ground that the judgment and decree of the learned Trial Court dated 26.07.2016 are perverse, contrary to natural justice and without appreciation of evidence. The learned First Appellate Court did not find any infirmity in the observations given by the learned Trial court while deciding the issue no. 1in favour of the Plaintiff and with respect to Issue No. 2, which concerned the want of cause of action, the learned First Appellate Court observed that the cause of action was inherently linked to the Plaintiff‟s entitlement to recover the suit amount and that the Defendant had failed to present any cogent material to establish that no cause of action existed for filing the suit. Thus, the first Appellate Court vide impugned order and judgment dated 25.10.2017 upheld the judgment and decree of the learned Trial Court dated 26.07.2016.

6. Aggrieved thereto, the Defendant preferred the instant second appeal on the ground that impugned judgment and decree dated 25.10.2017 are contrary to the evidence and material placed on record, thus, is liable to be set aside. Learned Counsel for the Appellant/Defendant has submitted that, in the present appeal, the following substantial questions of law arise for consideration: i. Whether the decision of the appellate court is vitiated for nonconsideration of the entire oral and documentary evidence in upholding the judgment of the Ld. Trial Court? ii. Whether the decision of the appellate court in concurring with the judgment and decree regarding the entitlement of plaintiff to decree of Rs 2,66,220/- alongwith interest @ 9% p.a. from the date of filing suit till its realization is correct ? iii. Whether an Application u/o 41 Rule 27 C.P.C. is filed by an appellant in order to fill up the lacunas before Ld. Trial Court ?

7. The Learned Counsel for the Defendant/Appellant submits that the findings of both the learned First Appellate Court and the learned Trial Court suffer from non-application of judicial mind. It is submitted that the Plaintiff/Respondent‟s suit is based solely on a forged document, as the alleged acknowledgment dated 02.11.2012, purportedly bearing the signatures of the Defendant/Appellant and his wife, is demonstrably forged. It is submitted that even from naked eye it is visible that there are significant differences between the disputed signatures on the acknowledgement dated 02.11.2012 and their admitted signatures on the sale deed, written statement, affidavit of evidence, and signatures recorded during cross-examination. Additionally, it is submitted that an application under Section 73 of the Indian Evidence Act was filed before the learned Trial Court, seeking a comparison of the Defendant/Appellant‟s signatures with those on the disputed acknowledgment. However, learned counsel submitted that without obtaining expert opinion, the learned Trial Court undertook the task of comparing the signatures itself and erroneously concluded their genuineness. Furthermore, learned counsel submitted that the Defendant/Appellant filed an application under Order 41 Rule 27 CPC before the learned First Appellate Court, seeking permission to present additional evidence, including expert opinion on the authenticity of the signatures. However, the learned first Appellate Court wrongly dismissed the application, holding that the Defendant/Appellant could not be permitted to fill up lacunas. It is submitted that the learned First Appellate Court failed to appreciate that the application was necessitated due to the erroneous approach of the learned Trial Court in not deciding the application under Section 73 of the Indian Evidence Act

8. The Learned Counsel for the Defendant/Appellant submits that both the learned First Appellate Court and the learned Trial Court erred in holding that the Plaintiff/Respondent proved the loan transaction merely on the basis of his assertion that the sum of Rs. 2.40 lakhs was reflected in his Income Tax Return. It is submitted that the learned Trial Court incorrectly treated a mere entry in the ITR as conclusive proof of the loan transaction and assessed the evidence in a piece meal manner, ignoring that a declaration of an amount as a loan in an ITR does not, in itself, establish that the loan was actually advanced. The learned Counsel for the Defendant/Appellant has categorically denied that any loan was received by the Defendant/Appellant from the Plaintiff/Respondent and has challenged the authenticity of the alleged acknowledgment.

9. The Learned Counsel for the Defendant/Appellant submits that the Plaintiff/Respondent‟s case is inconsistent and lacks material particulars. The Plaintiff/Respondent alleges that the Defendant/Appellant sought financial assistance for purchasing a flat from the DDA and that Rs. 2.40 lakhs were given six months before 02.11.2012. However, the sale deed of the flat in favor of the Plaintiff/Respondent‟s wife establishes that the Defendant/Appellant purchased the flat from DDA on 31.10.2012. This directly contradicts the Plaintiff/Respondent‟s claim that financial assistance was sought six months earlier. Moreover, it is submitted that the Plaintiff/Respondent has failed to specify the exact date on which the alleged loan was extended. Learned Counsel for the Defendant/Appellant also submits that if any amount had indeed been given to the Defendant/Appellant, it would have been adjusted in the sale consideration paid by the Plaintiff/Respondent‟s wife at the time of executing the sale deed on 02.11.2012 and the absence of any such adjustment further discredits the Plaintiff/Respondent‟s claim.

10. Learned Counsel for the Defendant/Appellant submits that both the learned Trial Court and the learned First Appellate Court failed to consider the absence of any valid reason for executing an acknowledgment of the alleged loan amount six months after its purported disbursal. It is also submitted that the learned Appellate Court has failed to independently assess the evidence and has merely reiterated the findings of the learned Trial Court without assigning any cogent reasons.

11. Per contra, learned counsel appearing for Plaintiff/Respondent submitted that the instant appeal raises no substantial question of law. It is submitted that the learned Trial Court and the First Appellant Courts have rightly decided the matter and have arrived at concurrent findings. It is submitted that the said findings cannot be interfered with and thus, the suit is liable to be dismissed.

12. The Defendant/Appellant has preferred the instant appeal under Section 100 of Civil Procedure Code, 1908 which reads as under:

(3) In an appeal under this section, the memorandum of appeal shall precisely state the substantial question of law involved in the appeal. (4) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question. (5) The appeal shall be heard on the question so formulated and the respondent shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question: Provided that nothing in this sub-section shall be deemed to take away or abridge the power of the court to hear, for reasons to be recorded, the appeal on any other substantial question of law, not formulated by it, if it is satisfied that the case involves such question.”

13. It is a settled proposition of law that the jurisdiction of the High Court in second appeals is limited to cases where a substantial question of law arises. The First Appellate Court is the final Court on facts and as a Court of the second appeal, the High Court in exercise of its jurisdiction under Section 100 CPC would not interfere in the impugned judgment on the ground of erroneousness of the findings of fact, however gross or inexcusable the error may seem to be unless there is a substantial question of law. Reliance can be placed on Bholaram v. Ameerchand (1981) 2 SCC 414 wherein the Second Appellate Court set aside the impugned judgment on the ground that the findings of the learned Trial Court and First Appellate Court were perverse and in disregard of the material available on record. However, Supreme Court, while setting aside the concerned High Court judgment, held that even if it was to accept the rationale of the concerned High Court, at best, it could be termed as an error in findings of fact but that itself would not entitle the High Court to interfere in the absence of a clear error of law.