Andhra HC (Pre-Telangana)
Jakkula Madhava Rao vs Andhra Jateeya Vidya Parishat ... on 25 September, 2002
Equivalent citations: I(2003)BC624
ORDER P.S. Narayana, J.
1. The unsuccessful defendant in O.S, No. 101 of 1982 on the file of the Additional Subordinate Judge, Kakinada is the appellant and the plaintiff in the said suit is the respondent. For the purpose of convenience the parties are referred to as plaintiff and defendant. The plaintiff instituted the suit for recovery of a sum of Rs. 42,336.66 on the strength of a promissory note dated 4.5.1979 for subsequent interest and for costs of the suit. The averments made in the plaint are as follows :
The plain tiff institution owns an extent of about Ac. 160.00 of land covered by R.S. 77 which is popularly called Peddampa in Thallarevu village, Kakinada Taluk the defendant was a tenant of the plaintiff for the said land up to the end of Fasli 1387. His son Jakkula Venkatarao was a tenant of the above said land from 1978-79 to 1980-81 and the rent was payable by 31st March, of succeeding year i.e. by 31.3.1979, 31.3.1980 and 31.3.1981. The said Venkatarao became liable to pay Rs. 15,750.00 for the year 1978-79 and it was attorned by the defendant and the defendant undertook and agreed to pay the same. Thus thedefendant became liable to pay the two amounts i.e. Rs. 20,382.41 ps and Rs. 15,750/-, total Rs. 36,132.41 ps to the plaintiff institution. The defendant executed the pronote dated 4.5.1979 for the said sum of Rs. 36,132.41 ps in favour of the plaintiff promising to pay the plaintiff or his order on demand with interest at 12%p.a. Subsequently on 27.6.1979, the defendant paid Rs. 5,000/- and took a receipt from the plaintiff. The plaintiff demanded the defendant to pay the amount due under the pronote to the plaintiff. The defendant wrote letters dated 29.12.1979 and 29.5.1980 stating that he would pay the money but he did not pay. The plaintiff issued a registered notice dated 25.8.1981 through their advocate demanding payment of the money due under the pronote immediately falling which a suit will be filed against him to recover the same with costs. The defendant received the notice and sent a reply requesting four months time for payment of the amount. He did not pay any amount till then. Hence the plaintiff is entitled to recover the suit amount from the defendant with costs with subsequent interest at 12% p.a. Act 7 of 1977 and Act 4 of 1938 are not applicable to the defendants. Hence the suit.
2. The defendant filed a written statement denying the allegations and pleading that the plaintiff institution owns only Ac. 106.00 but not Ac. 160.00 of land as alleged in the plaint. It was stipulated that representing the extent of the land as Ac. 160.00 and that the defendant represented the said fact to the plaintiff's representative. They are always promising that they would adjust at the final settlement of accounts. So it is clear that the defendant is not liable to Rs. 20,381.41 ps for Fasli 1387 and the amount is to be correspondingly reduced. The amount payable is Rs. 16,712.50 ps. The amount payable for three years is Rs. 49,712.50 ps whereas the amount paid is Rs. 48.617,59 ps. So the decree is to be passed for Rs. 1,094.71 ps only. It Is true that the defendant executed the pronote. But it is not true to say that the defendant's son Jakkula Venkatarao was the tenant under the plaintiff at any time. The defendant did not undertake to pay the makta alleged to be due from the said Venkatarao. The defendant Is always signing the papers at the request of the plaintiffs authorities and now the defendant finds that the clause relating to the alleged liability of Jakkula Venkatarao and the defendant undertaking are introduced in the pronote without the knowledge of the defendant. The alleged letters dated 29.12.1979 and 29.9.1980 are written to the dictation of the plaintiffs representative and as such thay cannot be relied on. The reply notice referred is also sent at the request of the plaintiff. So in view of the submission the plaintiff is entitled to only a decree of Rs. 10944.91 ps.
3. Subsequent thereto the plaint was amended as per orders made in LA. 6262 of 1988 dated 5.4.1988 and thus the plaintiff is being represented by the Executive Officer. The defendant also amended the written statement by an order in LA. 4480 of 1987 dated 24.11.1987 wherein it was pleaded that the plaintiff is a society registered under the Societies Registration Act and the Secretary alone can represent the plaintiff and the bye-laws provide a Trust Board consisting of minimum two trustees jointly can lay the suit. Inasmuch as there is only one trustee as is not co-opted in spite of the fact the bye laws provided for the same. There is no validly constituted Trust Board and so the person who signed the plaint has no right to represent the plaintiff. The plaintiff had filed rejoinder denying the allegations. The specific stand was taken that the governing body of the Council of the plaintiff institution validly passed a resolution authorizing the trustee Chelamalasetti Subrahmanyeswararo to file the suit and the trustee is a proper and authorized person to represent the plaintiff institution and to sign and verify the pleadings.
4. On the strength of the respective pleadings of the parties the following issues and additional issues were settled :
(a) Whether the suit pronote dated 4.5.1979 is not supported by consideration as pleaded by the defendant in the suit?
(b) To what relief?
Additional issues :
(a) Whether the plaintiff's association is registered under the Endowments Act?
(b) Whether the person who signed the plaint has no authority to sign the plaint?
5. Before the Trial Court the ex-trustee for the plaintiff institution was examined as PW-1 and Exs. A-1 to A-17 were marked. The defendant was examined DW-1 and Exs. B-1 and B-2 were marked. The Trial Court after appreciating the oral and documentary evidence had decreed the suit as prayed for with subsequent interest at 12% p.a. and with costs aggrieved by the same the present appeal is filed.
6. Mr. Subhash Chandra Bose, learned Counsel representing Mr. C. Poornaiah, Counsel for the appellant/defendant had made the following submissions. The learned Counsel had contended that the respondent/plaintiff institution was a Society registered under Societies Registration Act governed by bye-laws and the Articles of Association. The learned Counsel further pointed out that in view of Articles 23, 24 and 26 of Articles of Memorandum of Association, there shall be two trustees and whenever there is a vacancy the vacancy shall be filled up and all the legal proceedings by or against the plaintiff institution shall be conducted in the names of those trustees. The learned Counsel further contended that one of the trustees Mr. M. Laxminarayana was no more and hence the other trustees, a single trustee could not have validly instituted the suit and thus the very signing and verification of the plaint and the presentation of the suit is defective and in this view of the matter the suit is not maintainable. The learned Counsel also submitted that the mere fact that the plaintiff institution was taken over by the Endowments Department at a subsequent point of time and the Executive Officer of the department came on record will not in any way alter the situation or cure the defect. It cannot be said to be a mere irregularity but it is an illegality in the way of institution of the suit. The learned Counsel further while elaborating the submissions had pointed out that the evidence of DW-1 is clear and categorical about the extent of land and this aspect is amply established by Exs. B-1 and B-2 also and hence in this view of the matter it can be definitely said that the plaintiff institution is not entitled to the decree as prayed for. The learned Counsel had taken me through the evidence of PW-1 and also DW-1 and Exs. A-1 to A-17 and Exs. B-l and B-2 also.
7. On the contrary Mr. C.S.K.V. Ramana Murthy, learned Counsel for the respondent/ plaintiff while making methodical and systematic submissions had contended that the plea that suit is not maintainable for want of presentation of plaint by two trustees, is totally an unsustainable plea for the reason that as per the objects of the society, the plaintiff institution is undoubtedly a charitable trust. The learned Counsel further submitted that the regulation of the affairs and management of such institutions even otherwise would have been governed by the provisions of Andhra Pradesh Charitable and Hindu Religious Institutions and Endowments Act, 1966 hereinafter referred Act for the purpose of convenience. The learned Counsel also had submitted that even otherwise in view of the resolution it cannot be said that the trustee was not competent to institute the suit. At any rate, it cannot be an illegality but only an irregularity since such provisions were made in Article 26 of the Articles of Association, which would govern the internal affairs, and the management of the plaintiff institution. The learned Counsel, further submitted that even otherwise after the institution was taken over, the competent person Executive Officer came on record and hence it can be taken that the proceedings are being prosecuted by the competent person. The learned Counsel also had drawn my attention to Sections 21, 25 and also Section 27 of the Act in this regard. The learned Counsel further submitted that as far as the facts are concerned it is a suit based on promissory note and the defence taken by the appellant/plaintiff is a peculiar defence to the effect that the extent of land is of a lesser extent, having executed a promissory note. The appellant/defendant is bound to pay the amount and in case of taking any defence that there is either partial failure of consideration or he is liable only to some extent the burden is on him and except the evidence of DW-1 there is no other evidence and in view of the presumption under Section 118 of the Negotiable Instruments Act, automatically the respondent/plaintiff is entitled to a decree as prayed for. Hence in any view of the matter it cannot be said that the passing of consideration under Ex. A-4 was not proved and hence the findings recorded by the Trial Court cannot be disturbed in any way.
8. Heard both the Counsels on record. The points, which arise for consideration in this appeal, are as specified hereunder.
(a) Whether the person who signed the plaint has authority to sign the plaint?
(b) Whether the suit is not maintainable for the reasons specified in the additional written statement?
(c) Whether the suit promissory note is not supported by consideration as pleaded by the appellant/defendant?
(d) If so to what relief ?
Points a & b :
9. These points relate to presentation of the plaint and validity of the institution of the suit and hence these points can be discussed together.
10. As can be seen from the material available on record the ex-trustee of the plaintiff institution was examined as PW-1 and Ex. A-1 the resolution and Exs. A-2 and A-3 the letters written by the defendant to the plaintiff and Ex. A-4 the suit pronote executed by the defendant in favour of the plaintiff and Exs. A-5, A-6, A-7, A-8 and A-9 the letters and Exs. A-10 and A-11, the telegrams and Ex. A-12 the office copy of the letter by the plaintiff to the defendant and Ex. A-13 the office copy of the suit notice and Ex. A-14 the postal acknowledgement and Ex. A-15 the inland letter by the defendant to the plaintiff s Advocate and Ex. A-16 the Articles of Memorandum of Association of the plaintiff institution and Ex. A-17 the resolution book at page No. 21 had been marked. The plaintiff institution was originally a Society registered under the Societies Registration Act and as per the objects it cannot be in dispute that it is a charitable trust. The evidence available on record shows that this institution was taken over by the Endowments Department and no doubt the same was questioned by way of writ petition wherein the other parties were unsuccessful. It is also on record that subsequent thereto the Executive Officer was brought on record and the Executive Officer the competent person is continuing the litigation and the objection raised by the appellant/defendant relating to the maintainability of the suit is that the suit should have been presented by two trustees at least as per Article 26 only one trustee had signed and verified the pleading and hence there was no valid presentation of the plaint and in that view of the matter the very presentation of the plaint being defective, the suit should have been dismissed on that ground. It is no doubt true that Article 26 specifies so and it is also on record that the other trustee M. Laxminarayana died and there was vacancy. A finding was recorded by the Trial Court under what circumstances during that period the vacancy could not be filled up. In my considered opinion, it is not necessary to dwell into the said point any further for the reason that if the objects of the society are taken into consideration they are charitable objects and there cannot be any dispute that the provisions of the Act at the relevant point of time, Act 17 of 1966, were applicable but, however, the elected trustees were managing the affairs and these Articles of Memorandum of Association of the said society were for the purpose of regulating the internal affairs of the society. In the peculiar circumstances inasmuch as only one trustee was available at the relevant point of time, the said trustee had presented the plaint after signing and verifying the pleading. Such contravention or violation of the conditions specified in Article 26 at the best can be said to be an irregularity and at any rate it cannot be said to be an illegality or of such a mandatory nature which will go to the very root of the matter so as to touch the maintainability of the suit. Apart from this aspect of the matter, the initial defect if any had been cured by virtue of the Executive Officer being brought on record at a subsequent point of time during the pendency of the litigation. Section 21 of the Act which had been no doubt subsequently repealed by Act 30 of 1987, had dealt with the powers of the trustee. Likewise Sections 25 and 27 of the Act read:
Section 25. Act of trustees or Board of Trustees not to be invalidated by informality, vacancy, etc. :
No act or proceedings of the trustee or trustees appointed or deemed to be appointed or Board of Trustees constituted or deemed to be constituted under Section 15 shall be deemed to be invalid by reason only of a defect in the appointment of such trustee or trustees or constitution of such Board of Trustees or on the ground that the trustee, the Chairman or any member of the Board, as the case may be, was entitled to hold or continue in such office by reason of any disqualification or by reason of any irregularity or illegality in his appointment or by reason of such act or proceeding having been done or conducted during the period of any vacancy in the office of the trustee, Chairman, or member of the Board.
Section 27. Appointment and duties of Executive Officer-
(1) In the case of every charitable or religious institution or endowment, whose annual income exceeds rupees two lakhs, the Government shall appoint an Executive Officer for exercising the powers and discharging the duties conferred on him by or under this Act.
(2)(a) In the case of any charitable or religious institution or endowment, whose annual income is not less than rupees ten thousand but does not exceed rupees two lakhs, the Commissioner may appoint an Executive Officer for such institution or endowment for exercising the powers and discharging the duties conferred on him by or under this Act.
[(b) In the case of any other charitable or religious institution or endowment whose annual income is not less than rupees five thousand, the Commissioner may in accordance with such rules as may be made by the Government in this behalf-
(i) appoint the Executive Officer who has already been appointed under Subsection (1) or Clause (a) of this sub-section as Executive Officer for any such institution or endowment; or
(ii) group any such institution of endowment with such other institution or endowment, and appoint a manager for the group of institutions or endowments, whose total annual income is not less than rupees fifteen thousand."] (3) In the case of religious institution or endowment, the Executive Officer so appointed shall be a Hindu.
(4) (a) The Executive Officer appointed under this section shall be under the administrative control of the trustee of the institution or endowment and shall be responsible for carrying out all lawful directions issued by such trustee, from time-to-time.
The Executive Officer shall, subject to such restrictions as may be imposed by the Government-
(i) be responsible for the proper maintenance and custody of all the records, accounts and other documents and of all the jewels, valuables, moneys, funds and other properties of the institution or endowment;
(ii) arrange for the proper collection of income and for the incurring of expenditure;
(iii) sue or be used by the name of the Institution or endowment in all legal proceedings :
Provided that any legal proceeding pending immediately before the commencement of this Act by or against an institution or endowment in which any person other than an Executive Officer is suing or being sued shall not be affected;
(iv) lodge all moneys received by the institution or endowment in any scheduled Bank and be entitled to sign all orders or cheques against such moneys;
(v) have power in cases of emergency, to direct the execution of any work or the doing of any act which is provided for in the budget for the year of the immediate execution or the doing of which is, in his opinion, necessary for the preservation of the properties of the institution or endowment or for the service or safety of the pilgrims resorting thereto and to direct that the expenses of executing such work or the doing of such act shall be paid from the funds of the institution or endowment:
Provided that the Executive Officer shall report forth with to the trustee any action taken by him under this item and the reasons therefor.
C. The Executive Officer shall, with the prior approval of the trustee, institute any legal proceedings in the name of the institution or endowment, or defend any such legal proceedings, D. Where there is no Executive Officer in respect of any charitable or religious institution or endowment, the trustee or the Chairman of the Board of Trustees, as the case may be, of the institution or endowment shall exercise the powers, perform the functions and discharge the duties of an Executive Officer.
(5) The Executive Officer appointed under this section shall be the employee of the Government and the conditions of his service shall be such as may be determined by the Government. The salary, allowances, pension and other remuneration of the Executive Officer shall be paid in the first instance out of the Consolidated Fund of the State and later recovered from the institution or endowment concerned in accordance with the procedure laid down in this Act for the recovery of contribution from the institution or endowment.
11. In view of these provisions, I have no hesitation in arriving at the conclusion that the suit as presented and subsequently as being continued by the competent person, Executive Officer, is perfectly, maintainable and hence I am not inclined to accept with the contentions of the Counsel for the appellant in this regard.
Point c.
12. This point relates to factual aspects. The facts in nutshell had already been dealt with. The stand taken by the appellant/defendant is that the promissory note is not supported by consideration inasmuch as the extent of the leasehold land is not Ac.160.00, but it is only Ac. 106.00 and hence proportionately the rent has to be reduced. The Trial Court had discussed the oral and documentary evidence in detail at paras 14-17 and had arrived at a conclusion that the suit has to be decreed as prayed for. The documentary evidence also had been discussed at length, apart from the oral evidence. It is a peculiar case where the appellant/ defendant having executed Ex. A-4 now intends to go back on the recitals of the said document by raising a contention that the lease is covered by a lesser extent, proportionately the amount has to be reduced. No doubt apart from the evidence of DW-1, Exs.B-1 and B-2 were also relied upon for this purpose. It is needless to say that when failure of consideration or partial consideration in the case of promissory note is taken as defence the burden is on such parties to establish the same and except the evidence of DW-1 there is no other evidence on record. Ex. A-4 is the pronote and also the other correspondence between the parties and also the letters, etc., point out in favour of the respondent/plaintiff institution. In the light of the clear documentary evidence and the oral evidence, which had been dealt with in detail by the Trial Court, the same again need not be repeated in detail even at this appellate stage. I do not see any legal infirmity in the findings recorded on appreciation of facts at paras 14 to 17 of the judgment of the Trial Court. Hence viewed from any angle the appeal is devoid of merits.
13. In view of the findings recorded by my above, the appeal is devoid of merits. Accordingly, the same is dismissed with costs.