TMI Blog1979 (2) TMI 200X X X X Extracts X X X X X X X X Extracts X X X X ..... nsideration, ₹ 50,000/- would be paid by the plaintiff at the time of the registration and for the remaining ₹ 35,000/-, the plaintiff was to execute a mortgage of the suit property to be redeemed on or before May 31, 1951. It was further agreed that on payment of ₹ 50,000/- at the time of registration, the plaintiff would be put in possession of the suit property. The plaintiff pleaded that he was ready and willing to perform his part of the agreement, but came to know that defendant 1 was trying to evade his obligation under the agreement. Accordingly, the plaintiff sent a registered notice, dated July 7, 1950, through his lawyer to defendant 1, to which the latter replied the same day, that the factory was in possession of one Neelakanta Iyer as lessee, who had refused to give up possession and therefore, it had become impossible to give effect to the agreement to sell the factory, as giving possession to the plaintiff was a condition precedent to the execution of the sale deed. The plaintiff further pleaded that the suit property was really in possession of defendant 1 and the alleged lease in favour of Neelakanta Iyer was a sham transaction and a device to ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the plaintiff's suit by a judgment dated March 31, 1953. 9. Aggrieved, the plaintiff filed C.A. 129/56 in this Court. The plaintiff's appeal was allowed by this Court as per its judgment and decree, dated April 22, 1958. 10. Since a good deal of argument centers round the construction of this Court's decree, dated April 22, 1958, it will be pertinent to extract here the material part of that decree. (a) That the appellant herein do deposit within thirty days of the receipt in the decree of this Court the sum of ₹ 85,000/- in the District Court of Trichur and that on the aforesaid amount being deposited the said District Court of Trichur do forthwith give notice thereof to the respondents above named and that on the aforesaid amount of ₹ 85,000/-being deposited respondents Nos. 2 and 3 herein, namely S.M.R. Solaiyappa Chettiar and George Thatil do within 30 days from the date of receipt of the notice of the said deposit execute and register a sale deed in favour of the plaintiff (Appellant) in respect of the suit property. (b)... (c)) That the respondents above-named do pay to the appellant the cost incurred by him in the Court of the District ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contended that he was not liable for mesne profits as he had never been in possession and management of the suit property, and that the entire liability, if at all any, for mesne profits was that of defendant 3, who had been in exclusive possession of the property. 13. On December 22, 1962, the court of first instance passed orders in respect of mesne profits, costs etc. It found that defendants 1, 2 and 3 were jointly and severally liable to the plaintiff for a sum of ₹ 10,162.67 on account of costs of the Trial Court and the Supreme Court. The Court further found that defendant 2 was separately liable to pay to the plaintiff, a sum of ₹ 11,941.63 consisting of three items, namely, ₹ 1,239.02 on account of costs recovered by defendant 2 from decree-holder and payable by former with interest by way of restitution, ₹ 2,577.01 on account of costs in the High Court, and ₹ 8125/-on account of mesne profits from the factory from the date of suit till date of Ex. D-3. The aggregate amount under these two heads came to ₹ 23,103.70, which was allowed to be set off against ₹ 85,000/-deposited in Court by the plaintiff and the balance was directed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d mesne profits to the plaintiff, and that the aggregate of ₹ 21,200/- be set off against the sum of ₹ 85,000/- deposited by the plaintiff and the balance be paid to the mother of defendant 2. 16. Aggrieved by the judgment, dated August 8, 1968, of the High Court, Lucy Kochivareed, wife of the deceased defendant 3, has filed Civil Appeal 466 of 1969; while the plaintiff has preferred Civil Appeal No. 2375 of 1969. 17. Both the appeals will be disposed of by this common judgment. 18. We will first take up Civil Appeal 466 of 1969 filed by the widow of defendant 3. 19. The main contention of Mr. K.S. Ramamurthy, learned Counsel for the appellant (Luci Kochivareed), is that if the decree, dated April 22, 1958, passed by this Court in C.A. 129/56 is properly construed in the light of the material on record and the law on the subject, then three consequences inevitably follow: (i) Both defendant 2 and defendant 3 would be deemed to be in possession of the suit property during the period in question. The possession of defendant 2 was juridical or legal possession of an owner, he being the purchaser of the property from defendant 1; while that of defendant 3 was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion did not accrue within three years of the date of the decree of the Trial Court. Such a right, according to the counsel, accrued to the plaintiff only on April 22, 1958 when his amended suit for specific performance and possession and future mesne profits was decreed. In the alternative, as already noticed, counsel submits that mesne profits could not be awarded for any period prior to the date (September 12, 1958) on which the plaintiff deposited the price, because his right to possession accrued on that date and not earlier. 22. In support of his contentions, Shri Ramamurthy has cited a decision of this Court in Chitturi Subbanna v. Kudapa Subbanna and Ors. . He has also referred to some other rulings, wherein some general principles have been enunciated as to who can be made liable for mesne profits. 23. On the other hand, Mr. Govindan Nair, under Counsel for the plaintiff, submits that the decree, dated April 22, 1958 of this Court is crystal-clear. There is no ambiguity in it. Read in the light of this Court's judgment, it unmistakably shows that whosoever, out of the defendants was/were in actual possession, would be liable for the mesne profits from the date of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mbined to keep the plaintiff out of possession; it is open to the Court to adopt either of the two courses. It may by its decree hold all such trespassers jointly and severally liable for mesne profits, leaving them to have their respective rights adjusted in a separate suit for contribution; or, it may, if there is proper material before it, ascertain and apportion the liability of each of them on a proper application made by the defendant during the same proceedings. 27. Another principle, recognised by this Court in Chitturl Subbanna v. Kudapa Subbanna (ibid) is that a decree under Order XX Rule 12 of the Code, directing enquiry into mesne profits, howsoever expressed, must be construed to be a decree directing the enquiry in conformity with the requirements of Rule 12(1)(c), so that the decree-holder is not entitled to mesne profits for a period (commencing from the date of the institution of the suit) extending beyond three years from the date of the preliminary decree. 28. Again, possession through another, such as a tenant, may be sufficient to create liability for mesne profits if such possession is wrongful. 29. We will now deal with the contentions advanced by Mr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... han what is stipulated in the lease deed (Ex. I) in favour of Neelakantha Iyer . 33. There is not even a whisper in the pleadings that defendant 2 and defendant 3 were joint-tort-feasors and therefore, jointly and severally liable for mesne profits. 34. The plea now pressed into argument by Mr. Ramamurthy is thus a complete somersault of the position that had been taken in the courts below. 35. The Court of first instance after an exhaustive consideration of the overwhelming evidence, oral and documentary, on record reached the finding that ever since March 5, 1951, defendant 3 was, while defendant 2 was not, in actual control, management and possession of the suit property, and therefore, in terms of the decree dated April 22, 1958 of this Court, defendant 3 alone would be liable for mesne profits of the property. In appeal, the High Court found that the Court below was perfectly right in holding that the 3rd defendant was in sole and exclusive possession during the period in question and it is idle for him to pretend otherwise . Indeed, the third defendant himself had repeatedly admitted in various documents that he was in possession. In his application, Ex. D-77(a), ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the defendants was to be adjusted or apportioned, was a matter between the defendants only. The plaintiff was not bound to suffer a set off in favour of defendant 3, merely because defendant 2 or his assignee withdrew the price deposited by the plaintiff without furnishing any security for its refund or adjustment towards the liability of defendant 3, there being no evidence, whatever, on record to show that such withdrawal was the result of any collusion or conspiracy between the plaintiff and defendant 2 against defendant 3. 39. Assuming further, for the sake of argument, that defendant 2 and defendant 3 were both acting in concert to keep the plaintiff out of possession, it was not necessary for the courts below to decide the issue with regard to apportionment of liability and its adjustment between defendants 2 and 3. Indeed, the adoption of such a course would have militated against the finding that defendant 3 alone was in exclusive possession and control of the suit property ever since March 5, 1951. 40. We therefore, negative the first contention of the appellant. 41. This takes us to the second and third points pressed into argument by Mr. Ramamurthy. It is to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ;s decree, whereby mesne profits at the reduced rate of ₹ 15,000/- instead of ₹ 30,000/- per annum claimed by the plaintiff, were awarded. In that view of the matter, according to the counsel, the plaintiff was not entitled under the law to get a decree for mesne profits beyond August 27, 1955. It is pointed out that since the plaintiff had, as a result of the acceptance of the defendants' appeal and dismissal of his suit by the High Court, withdrawn the deposit of ₹ 50,000/- on August 19, 1953 and he had not redeposited the amount until February 9, 1959, he was dot then entitled to possession and, in consequence, to any mesne profits during this period. 44. The argument is certainly ingenious, but untenable, being founded on fallacious premises. The period of three years mentioned in Sub-Clause (iii) of Clause (c) of Rule 12(1) is to be computed from the date of the decree of this Court, i.e. from April 22, 1958 and it will expire on the date on which possession was delivered or relinquished by the defendant in favour of the decree-holder pursuant to that decree. In other words, the decree mentioned in Sub-Clause (iii) of the aforesaid Clause (c), would be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the period from August 19, 1953 to March 9, 1959', an at the High Court was in error in disallowing that interest; and (iv) that the Courts below were not justified in denying costs to the plaintiff in the inquiry as to mesne profits or in appeal arising therefrom. 49. We will deal with these contentions ad seriatim. Contention (i): 50. In this connection, Mr. Nair drew dm attention to Exhibits D-8 to D-15, which are Balance Sheets and Profit Loss Accounts of the Sivakami Tile Works, relating to the period from March 31, 1953 to November 5, 1958. These documents were prepared at the instance of the third defendant for the purposes of his Income-tax returns. The High Court found that these Balance Sheets and Profit Loss Accounts prepared for Income-tax purposes were suspicious documents and by themselves were not proof of the profits derived. Mr. Nair has no quarrel with this finding. He, however, contended that the High Court ought to have worked out the real profits by taking into account the quantity of clay purchased according to these documents. In this connection, it is submitted that according to the evidence produced on the side of the plaintiff about ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rate to 4 per cent, with the observation that having regard to all the circumstances of the case, including that the plaintiff had the use of the sum of ₹ 85,000/- which he was to pay towards the price of the property a rate of 4 per cent per annum would be reasonable and just. 56. Even Mr. Ramamurthy has not been able to support this reduction in the rate of interest. It was after a long drawn out litigation that the plaintiff got possession of the property. The Trial Court, therefore rightly awarded the interest at the rate of 6 per cent per annum. 57. We, therefore, accept this contention and direct that interest as part of the mesne profits assessed in this case, shall be payable at the rate of 6 per cent per annum upto March 29, 1959 when possession was delivered in pursuance of the decree of this Court, to the plaintiff and further interest at 6 per cent per annum on the outstanding amount shall be payable till the date of payment. Contention (iii): 58. A sum of ₹ 30,000/-, being the rent collected by the Receiver from the third defendant, was deposited in Court. This amount was withdrawn by the third defendant on August 19, 1953 following the dismissa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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