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Appeal dismissed, plaintiff deemed fictitious, agreement unenforceable. Defendants awarded costs. Refund and costs ordered. The appeal was dismissed, affirming the trial court's findings. The plaintiff was deemed fictitious, the agreement to sell was vague and unenforceable, ...
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The appeal was dismissed, affirming the trial court's findings. The plaintiff was deemed fictitious, the agreement to sell was vague and unenforceable, considered a benami transaction, and the plaintiff failed to fulfill payment obligations. Defendants No.4 and 5 were awarded costs due to unjustifiable involvement. The court directed the plaintiff to refund Rs. 66.00 lakhs to defendants No.1 and 2 and pay costs of Rs. 50,000/- to defendants No.4 and 5 within four weeks.
Issues Involved: 1. Whether the plaintiff is a fictitious person. 2. Whether the agreement to sell dated 27/04/2005 is vague, uncertain, and not capable of execution. 3. Whether the agreement to sell is hit by the prohibition under section 3 of the Benami Transactions (Prohibition) Act, 1988, and therefore not enforceable under law. 4. Whether the plaintiff was ready and willing to perform his part of the agreement. 5. Whether defendants No.4 and 5 are entitled to costs.
Detailed Analysis:
1. Whether the plaintiff is a fictitious person: The plaintiff, Satish Kumar Khandelwal, was described differently in the agreement and the plaint. The address in the agreement was a commercial place, while the address in the plaint was residential. The plaintiff admitted to using different names and addresses in various documents, leading to the conclusion that he acted as a front man for A.R. Infrastructure. The court found no plausible explanation for these discrepancies, thus affirming the trial court's finding that the plaintiff was a fictitious person.
2. Whether the agreement to sell dated 27/04/2005 is vague, uncertain, and not capable of execution: The agreement lacked specific details such as the exact dimensions, location, and boundaries of the land. Moreover, the agreement did not include a map or detailed description of the land to be sold. The trial court found the agreement to be ambiguous and not enforceable. The court cited several judgments, including Vimlesh Kumari Kulshrestha vs. Sambhajirao and Laxman Singh vs. Jagannath, to support the finding that the agreement was uncertain and not capable of execution.
3. Whether the agreement to sell is hit by the prohibition under section 3 of the Benami Transactions (Prohibition) Act, 1988, and therefore not enforceable under law: The plaintiff failed to prove the source of funds for the transaction, with the consideration being provided by third parties like A.R. Infrastructure and Ansal Housing and Construction Ltd. The court concluded that the transaction was a benami transaction, as defined under section 2(a) of the Benami Transactions (Prohibition) Act, 1988, and therefore prohibited under section 3(1) of the said Act. The court cited Pawan Kumar Gupta vs. Rochiram Nagdeo to emphasize that the source of consideration is crucial in determining a benami transaction.
4. Whether the plaintiff was ready and willing to perform his part of the agreement: The plaintiff failed to adhere to the payment schedule outlined in the agreement. The court found that the plaintiff did not make the required payments on time and provided false statements regarding cash availability. The court cited N.P. Thirugnanam vs. Dr. R. Jagan to highlight the necessity of continuous readiness and willingness to perform contractual obligations. The court concluded that the plaintiff was not ready and willing to perform his part of the agreement.
5. Whether defendants No.4 and 5 are entitled to costs: Defendants No.4 and 5 were unjustifiably dragged into the litigation, as they were not originally parties to the agreement. The court found that the plaintiff did not fulfill the condition precedent of paying Rs. 35.00 lakhs to defendants No.1 and 2 for purchasing land from defendants No.4 and 5. Therefore, the court awarded costs of Rs. 50,000/- to defendants No.4 and 5, payable by the plaintiff within four weeks.
Conclusion: The appeal was dismissed, affirming the trial court's findings on all issues. The court directed the plaintiff to refund Rs. 66.00 lakhs to defendants No.1 and 2 and awarded costs of Rs. 50,000/- to defendants No.4 and 5.
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