Sunil Thomas, J. - (1.) THIS appeal is directed against the judgment and decree in O.S. No. 54 of 2004 of the Sub Court, Kottayam in a suit for recovery of money. Defeated defendants are the appellants.
(2.) THE case set up by the plaintiff before the court below was based on an agreement for sale. According to the plaintiff, the plaint schedule property belonged to the first defendant and on receipt of a consideration of Rs. 7,50,000/ - by the first defendant, both the defendants executed an agreement for sale on 29.10.1997 in favour of the plaintiff for a total consideration of Rs. 8,00,000/ -. The original settlement deed executed by the second defendant in favour of the first defendant was handed over. The plaintiff was ready and willing to perform his part of the contract. However, in February 1998, the defendants requested to withdraw from the agreement which was accepted by the plaintiff. On 28.02.1998, first defendant delivered a cheque for a sum of Rs. 4,00,000/ - and promised to repay the balance sale consideration of Rs. 3,50,000/ - with interest before 15.04.1998. This was endorsed on the agreement for sale. The cheque was collected. However, the defendants failed to pay the money as agreed. Hence, on discussion between the parties, the period for repayment was extended up to 30.01.2001, which was also endorsed on the agreement. However, in spite of repeated demands, the defendants failed to pay the money. Hence, the suit was filed for recovery of money of Rs. 3,50,000/ - with future interest @18%. The defendants appeared and filed a written statement denying the execution of the agreement for sale. It was contended that the agreement dated 29.10.1997 was a sham document and was not intended to be treated as an agreement for sale. It was contended that the first defendant and his family were conducting a partnership business under the name and style 'Ambat Enterprises'. The plaintiff and his family were conducting a partnership financial institution under the name 'Standard Financiers'. Both the firms had cheque discounting business since 1995. Towards the above, cheques to third parties were delivered by the defendants to the plaintiff and to facilitate the above transaction, an agreement styled as an agreement for sale dated 29.10.1997 was executed. Cheques issued by Ambat Enterprises were obtained by Standard Financiers as per the cheque discounting business and encashed by sending it to bank. There were several financial transactions between both the firms. Subsequently, the agreement deed was extended up to 31.01.2001, though there were no financial transactions after 04.03.1998. The allegation that the defendants had accepted Rs. 7,50,000/ - of rupees from the plaintiff was false. The agreement was given only as a security for the financial transaction. The duration of the agreement was extended to 30.01.2001 in anticipation of future business. On 04.03.1998, plaintiff obtained an amount of Rs. 4,00,000/ - on encashing the cheque. Thereafter, he did not demand any amount and no money is due to the plaintiff from the defendants.
(3.) ON the basis of the rival contentions, appropriate issues were framed by the court below and both the parties adduced evidence. On the side of the plaintiff, P.W. 1 was examined. Exts. A1 to A6 were marked. First defendant was examined as D.W. 1 and D.W. 2 was also examined. Exts. B1 to B4 were marked on their side. Exts. X1 to X5(a) were marked as court exhibits.;