Full Judgment
O-50 ORDER
SHEET GA2329of 2016 With CS277of 2013 GA1741of 2016 IN THE HIGH COURT AT CALCUTTA Ordinary Original Civil Jurisdiction PARBATI GANGULI AND ORS.Versus M/S.BHASDEEP INFRASTRUCTURE DEVELOPMENT LTD.AND ORS.BEFORE: The Hon'ble JUSTICE SANJIB BANERJEE Date : 28th November, 2016.
Appearance: Mr.Joydip Kar, Sr.Adv.Mr.Aniruddha Mitra, Adv.Mr.Pratip Mukherjee, Adv.Mr.Tapen Sen, Adv.Mr.Ratnanko Banerji, Sr.Adv.Mr.Reetobroto Mitra, Adv.Mr.Biswanath Chatterjee, Adv.The Court: The claim is for a larger amount in the suit and even in the petition for judgment upon admission.
However, the extent of the immediate claim on admission is restricted to the four cheques last mentioned under clause 5 of an agreement of October 9, 2007 executed by the parties.
The family of Gangulis and their relatives substantially owned and controlled the third defendant company.
The fiRs.defendant, through its promoter, the second defendant, wanted to develop the land of the third defendant and entered into agreements with the third defendant or some of the plaintiffs for such purpose.
Disputes and differences arose in respect of such development agreements which resulted in a petition under Section 9 of the Arbitration and Conciliation Act, 1996 being carried to this Court in 2006.
Such petition, AP No.365 of 2006, was disposed of by terms of settlement said to have been executed on October 9, 2007, though the joint petition of all the parties to such proceedings was filed in Court for accepting the terms of settlement on September 20, 2007.
On October 9, 2007 the plaintiffs entered into an agreement with the fiRs.and second defendants, to which the third defendant company was also a party, for the sale of the plaintiffs’ controlling shareholding interest in the third defendant company to the fiRs.defendant herein.
It is evident from the agreement of October 9, 2007 that the plaintiffs and their immediate relatives held or controlled all but 703 of the 2505 shares issued in the third defendant company.
There was a clause in the agreement of October 9, 2007 that the holders of the balance 703 shares apparently did not have any heiRs.The fiRs.recital to the agreement on October 9, 2007 recorded that the third defendant herein was a lessee in respect of premises no.174, Jessore Road in Dumdum under two registered deeds in respect of an aggregate area of about 5.6 acre for a period of 50 years commencing June 3, 1966 with an option for renewal for a further period of 50 yeaRs.Some of the clauses of the deeds of 1966 were also noticed in the recital.
The agreement of October 9, 2007 envisaged the payment of a total sum in the range of Rs.17.75 crore by the fiRs.defendant herein to the plaintiffs or their immediate relatives who held shares in the third defendant herein and which shares were proposed to be transferred in favour of the fiRs.defendant herein.
A substantial part of such payment has already been received by the plaintiffs or their relatives.
Some payments still remain due.
The suit is for such balance payment.
Out of the money claim made by the plaintiffs herein, they seek a judgment on admission upon the following four cheques being dishonoured on presentation for insufficiency of funds: Beneficiary Amount Cheque No.Date of cheque October 5, 2011 Smt.Parbati Ganguli 1,04,03,717.46 285422 Mr.Tara Shankar Ganguli 1,04,03,717.46 285423 October 5, 2011 Smt.Sharmila Chakraborty 97,14,205.84 285424 October 5, 2011 Smt.Sudeshna Ganguly 95,17,202.52 285426 October 5, 2011 The plaintiffs claim that clause 5 of the said agreement of October 9, 2007 recorded an initial payment of Rs.25 lakh and the payment of the balance amount of Rs.17.50 crore in the manner indicated in a chart which formed a part of the relevant clause.
The immediate claim herein is on account of the said four cheques, all dated October 5, 2011, that were dishonoured upon presentation.
The plaintiffs refer to identical or similar notices of dishonour dated June 19, 2012 issued by Advocates on behalf of the beneficiaries of the said cheques to the fiRs.and second defendants.
Each of the relevant letters asserted that the concerned beneficiary of the cheque had duly endorsed her signature on the documents of transfer of the shares in the third defendant company herein in favour of the fiRs.defendant.
In short, the case made out in the relevant notices was that the beneficiaries of the cheques had discharged their part of the obligation to be entitled to receive the payment, but the cheques were not honoured upon presentation as the fiRs.defendant had not deposited sufficient funds or otherwise made arrangements for the cheques to be passed.
The fiRs.and second defendants refer to Section 118 of the Negotiable Instruments Act, 1881 and the principle enunciated therein.
The defence under the proviso to the Section has not been pleaded or asserted and, thus, the defence hinges on the fiRs.clause of the Section which lays down the rules of evidence in such regard : “118.
Presumptions as to negotiable instruments - Until the contrary is proved, the following presumptions shall be made:(a) of consideration - that every negotiable instrument was made or drawn for consideration, and that ever such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration; (b) .
.” The contesting defendants place clause 13 of the agreement of October 9, 2007 that provided for physical possession of the leased property at 174, Jessore Road to be “handed over to the fiRs.party” on the date of the execution of the agreement.
Indeed, to understand clause 13 of the said agreement, a reference is unavoidable to the opening limb of clause 12 thereof.
Clause 12 of the agreement began with the words “On the date of execution of this agreement .
.
”.
The rest of clause 12 spoke of resignation of the existing direct ORS.It is evident that the Ganguli directors or their relatives in the third defendant company were liable to resign as directors of the third defendant company on the date of execution of the agreement of October 9, 2007.
The following clause, clause 13, opened with the words “The same day, .
.” It is, therefore, evident that it was the obligation of the plaintiffs herein to hand over physical possession of the entirety of the leased property at 174, Jessore Road to the fiRs.defendant herein on the date of the execution of the said agreement.
It does not appear that the contesting defendants wrote any letter within any reasonable time of the execution of the said agreement of October 9, 2007 or even after receiving the notices of demand upon the relevant cheques being dishonoured, that the fiRs.defendant herein had not been put into physical possession of the entirety of the approximately 5.6 acre of land covered by the two deeds of 1966 pertaining to premises no.174, Jessore Road.
Indeed, the affidavit-in-opposition used by the contesting defendants in the present proceedings may not have clearly spelt out such defence.
The clear assertion in such regard is evident from paragraph 18(ii) of the supplementary affidavit filed by the contesting defendants.
There is a categorical statement therein that physical possession of the entirety of the land was not made over by the plaintiffs herein to the fiRs.defendant.
Such allegation has been dealt with in the rejoinder to the supplementary affidavit.
The plaintiffs have merely denied that possession of the relevant land, or the entirety thereof, was not made over to the fiRs.defendant herein.
The plaintiffs speak of a suit filed before the Barasat Court by the third defendant herein against the plaintiffs herein and otheRs.In such Title Suit No.173 of 2009, the averments made give an impression that the third defendant was in possession of the land and that such possession was being sought to be interfered with or denied by the defendants to the suit.
Paragraphs 26 and 37 of the Barasat plaint have been specifically referred to.
The plaintiffs say that if the third defendant was in possession of the entirety of the land as evident from the relevant plaint, it is inconceivable that possession of the entirety of 174, Jessore Road had not been made over by the plaintiffs to the fiRs.defendant who came to be in control of the third defendant upon the execution of the agreement of October 9, 2007.
The issue has to be answered conclusively against the contesting defendants if a decree were to be passed in favour of the plaintiffs.
That there is an admission of the contesting defendants’ liability in respect of the four cheques relied upon for the present purpose is obvious.
The question is whether the presumption as to the consideration has been successfully rebutted by the contesting defendants within the meaning of Section 118 of the said Act.
What is evident from the said agreement of October 9, 2007 is that the cheques detailed at clause 5 thereof, whether post-dated or not, were made over by the contesting defendants to the plaintiffs and their relatives in consideration for the control of the third defendant company being made over to the contesting defendants and the possession of the leasehold land measuring about 5.6 acre being also handed over to the contesting defendants.
Clause 13 of the relevant agreement envisaged physical possession of the land being made over almost simultaneously with the execution of the agreement or, at any rate, on the same day itself.
It is true that ordinary human conduct would have demanded that the contesting defendants would call upon the plaintiffs herein to make over physical possession of the entirety of the land in question within reasonable time of the execution of the agreement or even a few months or years thereafter; and certainly before the post-dated cheques of October 5, 2011 were dishonoured upon presentation.
Ordinary prudence may also have demanded that upon physical possession of the land not being obtained by the contesting defendants despite the contesting defendants having control over the third defendant company, they would have stopped payments in respect of the post-dated cheques issued to the plaintiffs or their relatives upon notice to such persons that they were not entitled to any payment or further payment for the breach on their part to make over physical possession of the entirety of the land.
However, the reality must also not be lost sight of.
No one dispossessed from any immovable property or not given possession of any immovable property to which he is entitled readily accepts or asserts that he has been ousted from possession or has not been given possession to the extent that he is entitled.
The primary reason for this is it is easier to claim possession and obtain of an order to protect possession when title may be undisputed, rather than claim dispossession or not being put into possession and wait for the several years that it takes a suit to work itself out in the present system.
It is in such context that the averments in the plaint filed by the third defendant company in Barasat must be seen.
To begin with, it was the third defendant which was the plaintiff in Barasat and not the contesting defendants herein.
There was no change in the status of the third defendant or its rights qua the relevant property on October 9, 2007.
Only the persons in control of such company changed, but the rights of the third defendant company were not affected by anything contained in the agreement of October 9, 2007.
Further, there is no clear sentence in the Barasat plaint that the plaintiffs herein have been able to show which can imply that the plaintiffs herein had made over possession of the entirety of 174, Jessore Road to the contesting defendants herein.
As is evident from the fiRs.recital to the agreement of October 9, 2007, the third defendant company was entitled to the two leases of 1966 within a right of renewal for a further period of 50 years after the original tenures ran out in 2016.
The Barasat suit is founded on such entitlement of the third defendant, without any assertion being made by the third defendant of the contesting defendants herein having been put into physical possession of the entirety of 174, Jessore Road after the change-over of control in the third defendant on October 9, 2007.
A judgment is not passed merely on the admission of a party.
If that were to be the case, no affidavit would be called for when an admission is cited.
A judgment is passed on admission upon there being an admission, such admission being clear, unambiguous and unequivocal and there being no defence to the admission or nothing to detract therefrom.
That is the reason why a person against whom a judgment on admission is sought is allowed to use an affidavit to explain away the admission.
There could be myriad situations cited by the person making the admission that could dissuade a Court from passing a decree based only on the perceived admission.
The ground cited by the contesting defendants herein is that the physical possession of the entirety of the land was not made available to them by the plaintiffs and, as such, the contesting defendants are not liable to suffer a decree on the basis of the admission, whether or not they had urged any ground in defence either prior to the cheques falling due for payment or upon receipt of the notices of dishonour.
The assessment that has to be made is whether a decree ought to be passed against the contesting defendants merely on the strength of the four cheques that were issued by them and such cheques being dishonoured.
Once a defence of breach of the kind that is asserted at paragraph 18(ii) of the supplementary affidavit is taken, it is incumbent on the other side to demonstrate the mendacity of such assertion.
The assertion in this case is that physical possession of the entirety of the land was not made over by the plaintiffs to the contesting defendants.
A mere denial of such assertion would not suffice; the plaintiffs ought to demonstrate something more substantial by proving that physical possession of the land had been made over to the contesting defendants.
The plaintiffs have gone about trying to discharge their onus, in the present state of evidence, by referring to the Barasat suit instituted by the third defendant and the averments made therein.
Nothing in such averments amounts to any assertion even by the third defendant of the plaintiffs having made over possession of the entirety of 174, Jessore Road to the contesting defendants herein.
The greater part of the affidavits filed by the contesting defendants speak of the plaintiffs having misled the contesting defendants into agreeing to pay much more for the control of the third defendant than such company was worth.
Apparently, the lessor who granted the two leases in favour of the third defendant in 1966 subsequently executed a Will in respect of a part of the land in favour of a relative of the plaintiffs herein.
The contesting defendants cry foul and suggest that such fact was actively concealed by the plaintiffs herein from the contesting defendants and it was only several years after the execution of the agreement of October 9, 2007 that the contesting defendants were made aware of a rival claim in respect of a substantial part of the land by the alleged legatee.
Such ground of the defence does not appeal.
The fiRs.recital to the agreement of October 9, 2007 is not recorded as a representation made by the plaintiffs herein to the contesting defendants; but as a statement of facts.
It would, thus, follow that the contesting defendants had acquainted themselves with the relevant papers and accepted that the two leases of 1966 were alive in 2007 and enjoyed by the third defendant herein; and that the third defendant herein had a right to seek and obtain renewal thereof for a further period of 50 years after the expiry of the original tenure of 50 yeaRs.A subsequent recital to the said agreement of October 9, 2007 set out the essence of the rights of the third defendant herein qua the parcels of land covered by the two leases.
It is elementary that during the subsistence of the rights conferred by the lessor under the two deeds of 1966, such lessor could not have altered the same to the prejudice of the lessee, unless the lessee accepted the same.
It is not the case of the contesting defendants that the third defendant lessee compromised its rights under the said two deeds of 1966 upon being made aware of rights in respect of any part of the land covered by the two deeds being altered to its detriment.
However, what is evident from such allegation is that the plaintiffs herein may not have been in a position to make over physical possession of the entirety of the land at 174, Jessore Road covered by the two deeds of 1966 to the contesting defendants on the date of the execution of the agreement of October 9, 2007 or at any time thereafter.
In such state of the evidence, it was for the plaintiffs herein to demonstrate that physical possession of the entirety of the land was made over to the contesting defendants herein, who came to be in control of the third defendant company upon the execution of the said agreement.
That the contesting defendants were obliged to pay the plaintiffs herein under the relevant agreement and that they had issued the four cheques relevant for the present purpose, are undeniable.
But, upon the plaintiffs failing to demonstrate that they have lived up to their side of the bargain in making over physical possession of the entirety of the 5.6 acre land to the contesting defendants on the date of the execution of the agreement or at any time thereafter, the plaintiffs herein are not entitled to a judgment on admission founded on the four cheques that have been relied upon herein.
GA No.1741 of 2016 is dismissed.
There will be no order as to costs.
Written statements, if not already filed, should be filed within six weeks from date; whereupon documents should be discovered and inspection completed within four weeks thereafter for the suit to be placed before the relevant Bench by the month of March, 2017.
In view of this order, GA No.2329 of 2016 is disposed of without any further order and without costs.
Urgent certified website copies of this order, if applied for, be supplied to the parties upon compliance with all requisite formalities.
(SANJIB BANERJEE, J.) dg2/SG