Madras High Court
R.Ranganathan … vs Baskaran In on 28 February, 2024
Author: P.T. Asha
Bench: P.T. Asha
A.S.No.468 of 2023
IN THE HIGH COURT OF JUDICATURE AT MADRAS
RESERVED ON : 28.11.2023
PRONOUNCED ON : 28 .02.2024
THE HONOURABLE Ms. JUSTICE P.T. ASHA
A.S.No.468 of 2023
and
C.M.P.Nos.16489 & 24948 of 2023
R.Ranganathan … Appellant
V.s
M.Habebullah ... Respondent
Prayer: First Appeal is filed under Section 96 of C.P.C to set aside the
Judgement and Decree passed by in O.S.No.22 of 2022 by the III
Additional District Court, Kallakurichi dated 27.06.2022.
For Appellant : M/s.Chitra Sampath, Senior
Counsel,
for Mr.C.Ravichandran
For Respondent : Mr.Bharath Kumar
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https://www.mhc.tn.gov.in/judis
A.S.No.468 of 2023
JUDGEMENT
The plaintiff has filed the First Appeal challenging the dismissal of his suit for recovery of money. The facts in brief are set out herein below and the parties are referred to as the plaintiff and the defendant as before the Trial Court.
Plaintiff’s Case:-
2. The plaintiff had filed the suit O.S.No.22 of 2022 on the file of the III Additional District Court, Kallakurichi for recovery of a sum of Rs.16,50,000/- together with interest at the rate of Rs.2/- per hundred per month on the sum of Rs.15,00,000/-.
3. The plaintiff would contend that the defendant had borrowed the aforesaid sum from the plaintiff on 13.09.2021 at his residence to meet his business needs as well as family expenses. He had promised to repay the said amount within a period of 3 months. The defendant had 2/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 also executed a promissory note in favour of the plaintiff agreeing to repay the aforesaid amount with interest at the rate of Rs.2/- per hundred per month. The plaintiff would submit that the defendant despite promising to repay the aforesaid sum within 3 months had failed to do so and he had neither paid the interest nor repaid the principal. Therefore, the plaintiff had issued a legal notice dated 20.01.2022 calling upon the defendant to pay the amount due under the promissory note. This notice was also received by the defendant on the very next day, however, the defendant had neither responded to the notice nor repaid the amount. Therefore, the plaintiff had come forward with the aforesaid suit in question.
Written statement of the defendant:
4. The defendant had denied the execution of the promissory note and also the receipt of the sum of Rs.15,00,000/-. The defendant would submit that he is not doing any business and there was no necessity for borrowing the aforesaid sum. The fact of the matter is that the 3/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 defendant owned an extent of 0.08.00 ares (0.20 cents) in Survey No.158/1A3, Kaniyamur Village and patta was standing in the name of the defendant in patta no.1242. The defendant had wanted to sell the aforesaid property at which point in time one P.Natarajan, son of Palaniandi, residing at No.174, Salem Main Road Kaniyamur Village, Kallakurichi and one S.M.Suresh Kumar son of K.S.Manian, residing at No.494 Kachirayapalayam Road of Kaniyamur Village had come forward to purchase the same.
5. An agreement of sale dated 25.03.2015 was therefore entered into between the defendant and the aforesaid persons. The total sale consideration was a sum of Rs.10,75,000/-. On the very same day, the said Suresh Kumar had paid a sum of Rs.10,00,000/-. The remaining Rs.75,000/- was to be paid within a period of 5 months. However, the said Natarajan and Suresh Kumar had not come forward to pay the balance sale consideration within the stipulated time of 5 months.
When the defendant who was living abroad had returned, the aforesaid 4/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 persons had informed him that they were not in a position to go-ahead with the transactions and therefore they had requested him to return the advance amount. On 18.04.2018, the defendant had repaid a sum of Rs.5,00,000/- to the said Suresh Kumar from out of the advance of Rs.10,00,000/-.
6. Once again, when the defendant had returned to India towards the end of the 2018, the said Natarajan and Suresh Kumar had lodged a police complaint against the defendant at Chinnasalem Police Station and one Inspector Sudhakararan had conducted the investigation. Ultimately, a compromise was arrived at amongst the parties wherein it was decided that the balance payment of Rs.5,00,000/- to Suresh Kumar and Natarajan would be paid as follows; Rs.1,00,000/- was to be adjusted towards damages since it was the said Natrajan and Suresh Kumar who had breached the agreement and the balance sum of Rs.4,00,000/- was payable by the defendant in small installments. It is the contention of the defendant that as a security, he was asked to sign 5/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 a blank bond paper and white papers before the police station. Thereafter, in view of the corona pandemic he was unable to keep up with the repayment schedule. According to the defendant, it is this blank bond paper and white papers that have been misused to create the present demand promissory note by Suresh and Natarajan to extract more money and interest from the defendant by filing the suit. Therefore, the defendant had lodged a complaint dated 27.01.2022 with the Superintendent of Police, Kallakurichi to recover the blank bond papers and white papers signed by him and the said complaint is pending. The defendant would submit that the plaintiff is not a man of means and he could not have extended a huge loan of Rs.15,00,000/-. The defendant would therefore submit that he does not owe any amount to the plaintiff and the suit should therefore be dismissed. Trial Court:-
7. The Trial Court had framed an issue as to whether the plaintiff was entitled to recovery a sum of Rs.6,50,000/- as claimed 6/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 and to what other reliefs the plaintiff was entitled to?
8. The plaintiff had examined himself as P.W.1 and one Natarajan, Pachaiappan and Sakthi as P.W.2 to P.W.4 and marked Ex.A.1 to A.11. The defendant had examined himself as D.W.1 and one Jinna as D.W.2 and Ex.B.1 to B.4 were marked.
9. The learned Trial Judge on perusing the records and evidence ultimately dismissed the suit. Aggrieved by the same, the plaintiff is before this Court.
10. Before setting out the submissions on either side, it would make useful reading to set out the documents filed on either side to prove their respective contentions:-
a. Ex.A.1 - is the promissory note alleged to have been executed by the defendant in favour of the plaintiff on 13.09.2021. The said promissory note is a printed document that would contain the following particulars 7/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 in writing: the amount, the date, the details of the promisor and promisee and the signature of the witnesses and the scribe along with the signature of the defendant one over the revenue stamp and one below it.
b. Ex.A.2 - is the legal notice issued by the plaintiff dated 20.01.2022.
c. Ex.A.3 - is the acknowledgment card showing that the notice has been delivered to the defendant.
d. Ex.A.4 - is the sale deed dated 06.10.1993 in the name of the defendant.
e. Ex.A.5 - is the tracking consignment for the reply notice sent by the defendant's counsel to the plaintiff’s counsel.
f. Ex.A.6 - is the reply notice dated 03.02.2022 issued by the plaintiff to the defendant.
g. Ex.A.7 and A.8 - are the applications made under the Right to Information Act by the plaintiff. 8/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 h. Ex.A.9 - is the reply issued to the plaintiff’s RTI application.
i. Ex.A.10 - is the complaint lodged by the defendant before the Inspector of Police Chinnasalam Police Station on 03.02.2022 and;
j. Ex.A.11 - is the CSR receipt.
k. Ex.B.1 - is the sale agreement entered into between the defendant, Natrajan and Suresh Kumar l. Ex.B2 - is the legal notice issued by the plaintiff to the defendant.
m. Ex.B.3 and B.4 - are the reply notice sent by the defendant.
11. The appellant/plaintiff has taken out an application for receiving additional documents and the documents that are sought to be filed are:-
i. Certified letter of request dated 13.10.2023 given to the 9/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 Panchayat Union Primary School Chinnasalem East.
ii. Certified extract of the attendance register maintained by the Panchayat Union Primary School Chinnasalem East.
iii. Certified copy of the movement registered maintained by the above school.
iv. Certified copies of the letter of handing over charge given by P.W.2 to his assistant from the records of the school.
v. Certified copy of the letter of request dated 13.10.2023 given by the Panchayat Union Primary School Kaniyamoor Kattukottai.
vi. Certified extract of the attendance register maintained by the Panchayat Union Primary School Kaniyamoor Kattukottai.
vii. Certified extract of the movement register maintained by the said school.
viii. Certified statement of account of the plaintiff maintained with the State Bank of India Kallakurichi Bank 10/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 Branch for the period 01.04.2020 to 31.07.2020. Submissions:-
12. The learned Senior counsel appearing on behalf of the plaintiff/appellant would submit that the signature in the promissory note has been admitted by the defendant. She would contend that the defendant has clearly stated that he had signed a blank bond paper and white papers and the signature having been admitted, the onus is on the defendant to prove otherwise.
13. The defense to this claim is that the defendant had some dealings with one Suresh Kumar and Natrajan regarding the sale of his property which later turned sour and therefore the said persons, in the presence of police authorities had obtained the signature of the defendant in blank bond papers and white papers. The defendant, during these negotiations, had promised to pay a sum of Rs.4,00,000/- towards repayment of remaining advance amount to P.W.2 and the said Suresh Kumar. However, this defense has not been proved by the 11/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 defendant. In fact, the defendant who claims to have filed a complaint in the year 2018 and on 27.01.2022 has not produced the copies of the said complaint.
14. The learned Senior counsel for the appellant would further submit that only a complaint dated 03.02.2022 has been filed which is evidenced by Ex.A.10 and A.11 which has been enclosed alongwith Ex.A.9, reply to the plaintiff's RTI query. This complaint does not make any mention about the 2018 complaint or the complaint dated 27.01.2022. She would submit that this complaint has been filed after Ex.A.2, legal notice had been issued by the plaintiff to the defendant and served upon the defendant on 21.01.2022. Thereafter, the defendant has rushed to file the complaint with an intent to create evidence. This is all more clear from the fact that the reply notice is given on the very same day i.e; on the day on which the complaint has been lodged under Ex.A.10. In this reply notice also the defendant has not made any mention about the earlier complaints. She would submit 12/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 that the contents of Ex.A.2, reply statement is totally contradictory to the contents of the complaint in Ex.A.10. That apart, in the written statement the defendant has only referred to a police complaint dated 27.01.2022 which apparently has not been filed and which is evident from Ex.A.9. Ex.A.9 is in response to the RTI application made by the plaintiff under Ex.A.7 and Ex.A.9.
15. The learned Senior Counsel would further submit that the plaintiff's witnesses in unison with insignificant discrepancies have deposed about the execution of the promissory note and the passing of consideration. She would submit that even going by the defense, the defendant has nowhere proved that he has repaid the entire amount as agreed. She would submit that the plaintiff has proved the execution and therefore the presumption to prove otherwise shifts on the defendant. Further, the Court below has proceeded on the basis that P.W.2 and P.W.4 who are teachers and who are the scribe and the witness have not produced their movement register, attendance register 13/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 etc; to prove their presence at the place of execution of the promissory note Ex.A.1 on the given date. Since no pleading to this effect had been taken, the plaintiff has not taken steps to produce these documents. It is for this reason that the present application for receiving additional documents have been filed. The same cannot be termed as an attempt to fill up the lacunae.
16. The learned Senior counsel would rely upon the judgement reported in 2019 (2) LW 748 - Veeraiya & another Vs. Baskaran in support of her argument that the minor discrepancies in the evidence of the witness should be overlooked more particularly when the signature has been admitted. The Trial Court has taken note of the following factors to arrive at a conclusion that suspicious circumstances exits and a mere perusal of the same would prove as to how insignificant they are:-
i. The plaintiff at one point in time would say that he has not seen the defendant. Whereas, in another place he would state that he had met 14/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 the defendant 10 days prior to the execution of the Promissory note.
ii. The witnesses are Government employees and the promissory note had been executed on a working day and no document has been filed to prove how they were present at the place of execution of the promissory note on a working day.
17. She would submit that the documents that are now sought to be produced would clearly show that the witnesses had taken necessary permission and at the relevant point in time had taken a leave of absence/permission from their respective schools. She would further argue that in the additional evidence, the plaintiff has also produce the letter of handing over charge by P.W.2 to his next command as also the bank statement which would prove the wherewithal of the plaintiff. She would submit that the additional documents therefore have to be received and these documents had not been filed earlier since no doubt regarding the presence of the witnesses (P.W.2 and P.W.4) at the time of execution of the promissory note had been raised during the oral 15/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 evidence. She would therefore pray that this Hon’ble Court may receive the document and pass a judgment after considering the same or in the alternative to remand the matter for letting in oral evidence in respect of the documents that are now sought to be marked.
18. Per contra, Mr.Bharath Kumar, learned counsel appearing on behalf of the defendant would submit that despite the defendant taking a categoric stand that he has only signed a blank bond paper and white paper, the plaintiff has not proved that the suit promissory note had been executed by the defendant as the security for the loan of Rs.15,00,000/-. He would submit that there are material contradictions in the evidence of P.W. 1 to P.W.4. That apart, the best evidence in the form of the movement register of P.W.2 and P.W.4 had been kept away. The plaintiff's side witness have contradicted each other with reference to the manner in which the alleged execution of the promissory note had taken place. The plaintiff as P.W.1 has contradicted his own statement where in one breath he would say that 16/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 he had seen the defendant prior to the execution of the promissory note and later in point of time would submit that he had seen the defendant only on the date when the execution of the promissory note had taken place.
19. He would further submit that the plaintiff who has paid such a huge amount of Rs.15,00,000/- by cash has not proved his wherewithal. The plaintiff who is a retired Government Officer has not produced his bank statement to show as to whether he had the requisite amount to his credit on the date of execution of demand promissory note. The learned counsel would further submit that there are contradictions regarding the time when promissory note is said to have been executed. P.W.4 would state that it has been executed at 9 a.m, whereas, P.W.2 would state that the execution was done at 10.45 a.m and P.W.3 would state that it was between 11 a.m and 11.15 a.m. He would further submit that the application for receiving additional documents is highly belated. The defense to the above application is 17/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 that the promissory note had come into existence only on account of the collusion between P.W.2, P.W4, the plaintiff and the said Suresh Kumar. The defendant had categorically disputed the promissory note and had stated that he had never borrowed money from the plaintiff nor executed a promissory note. In view of the above, the plaintiff ought to have taken steps to prove the same. He would rely upon a judgment of this Court reported in 2007 (1) LW 806 - Thilagavathy Vs. Mohammed Rabeek.
20. The present application to accept the additional documents is only an attempt to fill up this lacunae. The Judgment was pronounced 6 months after it was reserved. Even during this time steps had not been taken to file these documents. The plaintiff has not taken steps to file these documents though arguments had been advanced on the above lines. He would submit that even a perusal of the documents would indicate that the same has been applied for only 3 months after the judgment was pronounced and therefore these documents are not 18/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 document which have come to the knowledge of the plaintiff subsequently or ones which the plaintiff has not been able to obtain copies of despite his best efforts. He would rely upon the judgment of the Hon'ble Supreme Court reported in (2015) 17 SCC 713 - A.Andisamy Chettiar Vs. A.Subburaj Chettiar. Therefore, he would submit that the well considered judgment and decree of the Trial Court has to be confirmed.
21. The points that arise for consideration in the above First Appeal are:-
i) Whether the plaintiff has proved the execution of the promissory note as set out in the plaint?
ii) Whether the plaintiff has proved the passing of consideration?
iii) Whether the promissory note has come into existence on account of the collusion between the plaintiff, P.W.2, P.W.4 and one Suresh Kumar? 19/30
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iv) To what other relief the plaintiff is entitled to?
22. Heard the submissions on either side.
Discussion:-
23. The plaintiff has filed the suit for recovering money on a promissory note which has been marked as Ex.A.1. The signature and thumb impression on this document has been admitted by the defendant. However, his defence is that this promissory note has been fabricated making use of blank promissory notes executed by the defendant towards another transaction.
24. The defendant’s contention is that he had entered into an agreement of sale with one Suresh Kumar and Natrajan in respect of properties belonging to him in Kaniyamur Village on 25.03.2015. The sale consideration had been fixed at a sum of Rs.10,75,000/- and an advance of Rs.10,00,000/- had been paid. The remaining sum of 20/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 Rs.75,000/- was to be paid within 5 months. The defendant would go on to state that the said Natarajan and Suresh Kumar had later expressed their inability to proceed further with the transaction and on 18.04.2018, a sum of Rs.5,00,000/- from out of the advance amount had been refunded by the defendant to the aforesaid persons. There is no clarity as to the date on which these persons had expressed their inability to proceed with the sale.
25. Thereafter, it is the case of the defendant that when he had returned to India towards the end of the year 2018, the aforesaid persons had lodged a complaint against him before the Chinnasalem Police Station and he was called for an enquiry. At which point in time negotiations had taken place and it was agreed that out of the sum of Rs.5,00,000/- only a sum of Rs.4,00,000/- was payable by the defendant to Suresh Kumar and Natarajan that too in small installments and the balance of Rs.1,00,000/- was to be adjusted towards damages. Once again there is no detail about the date on which such a settlement 21/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 had taken place. In the reply notice Ex.A.6= Ex.B.3 there is no mention that the sum of Rs.4,00,000/- was to be paid in small installments. The reply notice would indicate that this sum of Rs.4,00,000/- was payable in one go. However, the details as to the time when the amount was repayable has not been provided. This assumes significance since P.W.2 Natarajan who is one of the agreement holders depose that the entire sum of Rs.10,00,000/- has been repaid by the defendant. D.W.2 would state that Rs.5,00,000/- was paid by cash to him and Rs.5,00,000/- was paid to Suresh Kumar through bank transfer. The negotiations alleged to have been done at the Police Station has been categorically denied by P.W.1.
26. In his written statement, the defendant had contended that he had lodged a complaint against the said Natarajan and Suresh Kumar for misusing the blank documents signed and given by him on 27.01.2022. However, this complaint has also not been produced before the Court. Therefore, the defendant has not proved his defence. 22/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 Except for marking the agreement of sale which is of the year 2015, no other documents to support the contentions raised in the reply notice as well as in the written statement have been produced by the defendant.
27. Further, the only complaint that has been lodged by the defendant is dated 03.02.2022 (the very same day on which Ex.B.3 has been issued). This complaint has been marked as Ex.A.10 and the CSR receipt as Ex.A.11. In this complaint which has been lodged with the Inspector of Police, Chinnasalem Police Station the defendant would contend that on 07.01.2022, the said Suresh Kumar and Natarajan along with others had come to his residence and abused him using unparliamentary words and bundled him in their car and taken him to Chinnasalem Police Station where the false documents had been procured by them with a malafide intent. It is his contention that they had threatened him and at knife point had obtained the signatures in a blank bond paper and blank sheets. These statements have not been stated either in the reply notice or in the written statement. Therefore, 23/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 going by this complaint the blank promissory note appears to have been obtained on 07.01.2022 which is not the case in the written statement. Having admitted the signature, the onus shifts to the defendant.
28. The Hon’ble Supreme Court, in the Judgement reported in 1999 (3) LW 237 - Bharat Barrel and Drum Manufacturing Co. Vs. Amin Chand Payrelal, had observed as follows :-
"Once execution of the promissory note is admitted, the presumption under Section 118(a) would arise that it is supported by consideration. Such a presumption is rebuttable. The defendant can prove the non-existence of consideration by raising a probable defence. If the defendant is proved to have discharged the initial onus of proof showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would 24/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 shift to the plaintiff who will be obliged to prove it as a matter of fact and upon its failure to prove would dis-entitle him to the grant of relief on the basis of the negotiable instrument."
29. This judgement has been followed by a learned Single Judge of this Court in the Judgement reported in 2019 (2) LW 748 - Veeraiya & another Vs. Baskaran where the learned Judge had observed as follows:-
"The First Appellate Court is correct and justified in applying the presumption under Sections 20 and 118 of the N.I.Act as above discussed and the defendants having failed to discharge the initial burden resting upon them in establishing the plea of the non-passing of consideration under the suit promissory notes, it is found that the onus would never shift to the plaintiff and in such view of the matter, the inconsistencies and contradictions 25/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 pointed out by the defendants' counsel in the evidence of the plaintiff examined as P.W.1, that by itself, would not be sufficient to improbablize the plaintiff's case and as above seen, considering the principles of law outlined by the Apex Court, when the defendants had failed to discharge the burden resting upon them, the claim of the plaintiff cannot be disallowed."
30. Therefore, the 1st point for consideration is answered in favour of the plaintiff. Considering the fact that the defendant has not been able to prove the contentions regarding the alleged complaint against the said Suresh Kumar and Natarajan, the 3rd point for consideration is also answered against the defendant. The complaint dated 03.02.2022, which is the only complaint that has been filed on the side of the defendant has been lodged only after the legal notice had been issued by the plaintiff claiming refund of the amount due under the promissory note. Therefore, the very complaint appears to be an 26/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 afterthought and an attempt to create evidence.
31. With reference to the issue of passing of consideration, P.W.1 has stated that he was employed as a Retired Education Officer and that he had retired on 31.03.2020. He would also state that he had a sum of Rs.20,00,000/- on hand from out of which he had paid a sum of Rs.15,00,000/- to the defendant as a hand loan. The said loan had been given on 13.09.2021 within a year of the plaintiff having retired and therefore it can be presumed that the plaintiff had the necessary wherewithal to give a hand loan of a sum of Rs.15,00,000/-. No doubt, the bank statement has not been produced on the side of the plaintiff, however, it is seen that the defendant has not questioned the other witnesses with reference to the passing of consideration. P.W.2 and P.W.3 in their chief examination have deposed about the passing of consideration and they have not been cross examined in this regard. Therefore, the plaintiff has proved the passing of consideration and the 2nd point for consideration is also answered in favour of the plaintiff. 27/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023
32. Considering the fact that the judgement has been passed on the available evidence, the additional documents that are sought to be filed through C.M.P.No.24948 of 2023 is not required and the C.M.P. is dismissed.
33. Therefore, the First Appeal is allowed, the judgment and decree of the Trial Court, namely, The III Additional District Court, Kallakurichi is set aside. No costs. Consequently, the connected Miscellaneous Petition is closed.
28.02.2024 Index: Yes/No Speaking order/non-speaking order shr To,
1. The III Additional District Court, Kallakurichi.
2. The Section Officer, V.R.Section, 28/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 High Court, Madras.
29/30 https://www.mhc.tn.gov.in/judis A.S.No.468 of 2023 P.T.ASHA, J., shr A.S.No.468 of 2023 and C.M.P.Nos.16489 & 24948 of 2023 28.02.2024 30/30 https://www.mhc.tn.gov.in/judis